Hits & Takes
John Lothian & JLN Staff
Nearly 95% of the oil and gas production from the Gulf of Mexico has been shut down because of Hurricane Ida, according to S&P Global Platts, Barron’s reported. — Barron’s
The storm surge from Hurricane Ida was so strong, it caused the Mississippi River to reverse its flow, something called “extremely uncommon.” The river rose 7 feet at the “USGS gauge, located in Belle Chasse, about 20 miles south of New Orleans in southeastern Louisiana.” The deep part of the river may not have reversed flow. — CNN
Intercontinental Exchange, Inc. today reported a record 20,732 Micro NYSE FANG+™ Index futures traded on August 26. The average daily volume, or ADV, of the Micro Fangs has grown to a record 8,423 contracts in August. — ICE
The NYSE extended its deepest sympathies to the U.S. service members and Afghans killed in the Kabul airport attack. On Friday, NYSE held a moment of silence in remembrance of the lives lost and families impacted by the event. — NYSE
CQG today announced connectivity to the Brazilian Exchange B3 for trading and market data. This will open B3 to multitudes of brokerage firms and retail and professional traders that did not have access B4. — CQG
You can register for the LME Metals Seminar 2021 on Monday, October 11, held in Queen Elizabeth II Centre and online. — LME
Here is the statement from SEC Chairman Gary Gensler about the “request for information anc comments on broker-dealer and investment advisor digital engagement practices, related tools and methods, and regulatory considerations and potential approaches.” He said, “These apps use a host of features that have come to be familiar in our increasingly online world. Digital engagement practices (DEPs), including predictive data analytics, differential marketing, and behavioral prompts (such as gamification), are integrated not only into streaming platforms and fitness apps, but also in robo-advising, wealth management platforms, brokerage platforms, and other financial technologies.” — SEC
Kimberly Kolb has joined Sphera as the chief human resources officer. She was previously the head of human resources and recruiting for XR Trading for 10 years. I met Kimberly when she was the chief marketing officer and head of HR for U.S. Futures Exchange. — LinkedIn
Bruce Kovner, the retired Caxton Associates hedge fund founder, is selling his 22-acre California compound near Santa Barbara on a bluff overlooking the Pacific Ocean for $160 million. It is a beautiful property that might just be worth the money and if it sold for the asking price would nearly match the most expensive property sale in California history. — WSJ
Qontigo celebrated International Dog Day by giving a “shout-out to all Chief Barking Officers, Snack Supervisors, Tennis Ball Managers and Crumb Patrol Officers who are relentlessly supporting Qontigo during work-from-home!” Included in the post were some nice pooch pictures. —LinkedIn
Speaking of Qontigo, they reported that trading in STOXX Europe 600 ESG-X futures at Eurex topped 1 million contracts this year. Qontigo said, “A total of 1,002,646 futures contracts exchanged hands in 2021 as of Aug. 24, a record annual high for any ESG instrument traded on Eurex and a 56% jump from the same period last year.” — Qontigo
I have recommended my church, St. Peter’s United Church of Christ in Elmhurst, Illinois, to move its accounting system from Church Window, which runs locally on their network, to cloud-based REALM. I also recommended that the church adopt the REALM Connect system for communication within the congregation, which includes two apps. One app is for the congregation to use, the other for the professional staff. This is a giant leap forward for the church. I am the head of the communications ministry team at the church and on the board of deacons, which handles financial matters. I was also the chair of the Long Range Vision team that developed a plan for the growth and development of the church, including adding better technology for the sanctuary and interaction within the congregation. Sometimes I think running JLN is my sideline job.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
Fed’s Powell Takes Center Stage; New Company Offers Options Solutions; Explaining Volatility Skew – The Spread – August 27, 2021
— In this week’s options news, the Fed’s Jackson Hole pronouncements placate the markets; meme stocks take off on a lark; volatility skew rises as traders remain divided; bitcoin and ethereum options hunker down ahead of expiration and Eurex plans to launch a first.
— John’s Take looks at a new options business with seasoned players.
— And Jermal Chandler kicks off this week’s options “Term of the Week” with the important concept of volatility skew.
Meet Gary Gensler, a former MIT blockchain professor who now leads the SEC and could finally regulate the volatile crypto space
Katie Canales – Business Insider
SEC chairman Gary Gensler comes from MIT, where he taught a cryptocurrency course; Now, his agency might be in charge of regulating the volatile and often murky crypto market; Gensler is a rarity in Washington: he understands the technology he’s trying to rein in; 10 Things in Tech: Get the latest tech trends & innovations
Washington has historically been in short supply of lawmakers and enforcers who actually understand the technology they’re seeking to regulate. Gary Gensler is among those changing that. He’s the new chairman of the US Securities and Exchange Commission, an agency that might also be responsible for creating rules in the volatile and wildly popular crypto space.
***** Gary Gensler has an excellent communications staff and is much more media savvy during his tenure at the SEC than when he was at the CFTC. Not that the CFTC staff was not excellent, but Gensler is being much more proactive at the SEC, or so it seems to me.~JJL
49 Law Firms Unite and Push Back on Recent SPAC Litigation; The legal community signs statement declaring these suits are “without factual or legal basis”.
Kristi Marvin – SPACInsider
In response to the recent PR machine from former SEC commissioner and current NYU Law professor Robert Jackson and Yale Law School professor John Morley, which have put out multiple statements in the press noting they intend to litigate SPACs for Investment Company Act of 1940 issues, an astonishing 49 law firms have coalesced to release a response to these allegations.
***** These are 49 of the best law firms money can buy.~JJL
Insights on Cyber and Tech Risks in Finance
Ketan B. Patel – Chicago Federal Reserve Bank
For its latest episode, LaSalle Street welcomes cyber risk executives representing financial firms to discuss cyber and technology risk management. Ketan B. Patel, policy advisor and head of financial markets risk analysis in the Chicago Fed’s Financial Markets Group, hosts this episode. Alessandro Cocco, vice president of the Financial Markets Group at the Chicago Fed, provides an introduction.
*****The Chicago Federal Reserve Financial Markets Group is also very media savvy these days and proactive. ~JJL
As Wildfires Burn, ICE Shows How Sophisticated ESG Tools Have Become
Farrell Kramer. – NYSE
Wildfires are raging across the western United States, destroying homes, commercial buildings and entire towns. The biggest is the Dixie Fire, which has spread across more than 700,000 acres in Northern California and turned more than 1,200 buildings to ash. “My defiantly quirky, beautiful adopted hometown turned into a ghost town last night,” reporter Meg Upton wrote on Aug. 5 in the Plumas News. In an unstoppable march of heat and flame, the Dixie Fire erased the bulk of Upton’s hometown of Greenville from existence.
****** ICE’s Farrell Kramer columns are also a great example of a proactive media strategy.~JJL
Wall Street Rides FAR to Ring NYSE Closing Bell on August 30, 2021; Annual charity event to benefit the Autism Science Foundation celebrates its seventh year by ringing the NYSE Closing Bell®
Wall Street Rides FAR
Wall Street Rides FAR (For Autism Research), the annual charity cycling and walking event benefiting the Autism Science Foundation (ASF), today announced that it will ring the New York Stock Exchange (NYSE) Closing Bell® on August 30, 2021. The event, which was co-founded seven years ago by Bryan and Melissa Harkins, has raised over $2 million to date for ASF, each year attracting some of the most prominent firms on Wall Street and beyond to participate.
***** Have you donated yet?~JJL
Big Tech Wants You to Live in a Virtual World. Prepare for Real Problems; Facebook and other companies view the ‘metaverse’ as the next big thing, but user discretion is advised
Dan Gallagher and Laura Forman – WSJ
Heard of the “metaverse” lately? It has been hard not to. Facebook FB 2.26% Chief Executive Mark Zuckerberg mentioned tech’s latest buzzword 16 times on his company’s most recent earnings call last month. The future of Facebook, he said, is a metaverse—a virtual environment where you can be physically present to hang out, play games, work and create.
*****The metaverse we need is the open outcry metaverse where the market is represented virtually with different traders standing in a huge trading pit full of avatars for the traders representing the bids and offers.
Friday’s Top Three
Our top story Friday was Twelve-year-old boy makes £290,000 from whale NFTs, from BBC News. Second was the Wall Street Journal’s The Social-Media Stars Who Move Markets. Third was the YouTube video EXPLAINED: Money Laundering (Kelly Richmond Pope – Forensic Accountant).
26,588 pages; 235,652 edits
A SPAC Counterattack; A group of law firms lined up to condemn lawsuits filed against the contentious blank-check investment vehicles.
Andrew Ross Sorkin, Jason Karaian, Sarah Kessler, Stephen Gandel, Lauren Hirsch, Ephrat Livni and Anna Schaverien – NY Times
When 49 major national law firms banded together late last week to condemn lawsuits targeting special purpose acquisition companies, the deal-making world took notice. To get “firms who regularly litigate against each other to agree on something” is impressive, Joseph Grundfest, a Stanford Law professor and former S.E.C. commissioner, told DealBook.
SEC to review the spread of gamelike features on stock trading apps; US regulator will also examine marketing practices based on personal profiles of investors
Kiran Stacey and Madison Darbyshire – FT
The US stock market regulator has asked the public to weigh in on the “gamification” of share trading, in response to concerns that some online apps are prodding investors to take risks they do not fully understand. The US Securities and Exchange Commission on Friday issued a request for comment on the digital practices used by online platforms such as Robinhood to keep customers trading.
CQG Announces Connectivity to Brazilian Exchange B3 for Trading and Market Data
CQG, a leading global provider of high-performance technology solutions for traders, brokers, commercial hedgers, and exchanges, announced today that it has added to its global network of exchanges B3, one of the world’s largest financial market infrastructure companies.
Trading in STOXX Europe 600 ESG-X Futures at Eurex Tops 1 Mln Contracts This Year
Trading in STOXX® Europe 600 ESG-X Index (FSEG) futures, the world’s most popular sustainability-focused derivatives, has topped 1 million contracts this year, as more traders and investors turn to the products to manage responsible portfolios.
How US community banks became ‘irreplaceable’ in the pandemic; Local lenders played an outsized role in dispensing loans to small businesses but must continue to adapt as banking moves online
Brendan Greeley – FT
Darryl Jorgenson steps into his cherry-red Ford pick-up truck and apologises for the glitter in the back seat. It is left over from his son’s prom night. Jorgenson, the business banker at Gate City Bank in Grand Forks, a small city of 50,000 people in North Dakota, is on his way to Rumors, a hockey bar at the Grand Cities Mall. It is one of the many small businesses he helped keep alive with a pandemic loan last year.
Price discovery in markets not imperilled by index funds; Flows by active traders still set pricing levels despite relentless rise of passive vehicles
Amin Rajan – FT
Just before his death in 2019, index funds pioneer Jack Bogle worried that their relentless rise might not “serve the national interest”. His worries centred on both the excessive trading in exchange traded funds as well as the prospect of mega indexers — like BlackRock, State Street and Vanguard — controlling a big shareholder vote in leading US companies.
Direct Listings Have Paid Off for Investors So Far; Warby Parker and other tech companies show direct listings are here to stay as such stocks have been a solid bet
Maureen Farrell – WSJ
Eyewear maker Warby Parker Inc. last week became the latest company to file paperwork with the Securities and Exchange Commission for a direct listing, illustrating the staying power of the alternative path to public markets for companies that don’t need to raise money.
Lawyers fight back following attack on SPACs
Lydia Moynihan – NY Post
The nation’s top law firms are clapping back against an explosive lawsuit filed last week that argues so-called special-purpose acquisition companies, or SPACs, should be regulated as investment vehicles. In a letter released Friday, 49 of the most prestigious law firms in the US came to the defense of blank check companies, which sparked a craze last year for investors looking to take companies public quickly while sidestepping the hassles and regulations associated with the traditional IPO process.
Statement on Request for Information and Comments on Broker-Dealer and Investment Adviser Digital Engagement Practices, Related Tools and Methods, and Regulatory Considerations and Potential Approaches
Chair Gary Gensler – SEC
Today, the Commission published a request for public comment on the use of new and emerging technologies by financial industry firms. While these new technologies can bring us greater access and product choice, they also raise questions as to whether we as investors are appropriately protected when we trade and get financial advice. These apps use a host of features that have come to be familiar in our increasingly online world. Digital engagement practices (DEPs), including predictive data analytics, differential marketing, and behavioral prompts (such as gamification), are integrated not only into streaming platforms and fitness apps, but also in robo-advising, wealth management platforms, brokerage platforms, and other financial technologies.
George Soros: Investors in Xi’s China face a rude awakening; The leader’s crackdown on private enterprise shows he does not understand the market economy
George Soros – FT
Xi Jinping, China’s leader, has collided with economic reality. His crackdown on private enterprise has been a significant drag on the economy. The most vulnerable sector is real estate, particularly housing. China has enjoyed an extended property boom over the past two decades, but that is now coming to an end. Evergrande, the largest real estate company, is over-indebted and in danger of default. This could cause a crash.
Billionaire Paulson Who Shorted Subprime Calls Crypto ‘Worthless’ Bubble; The investor also explains why gold is poised to surge on “Bloomberg Wealth with David Rubenstein.”
Steven Crabill – Bloomberg
Ever since John Paulson bet against the U.S. housing market more than a decade ago, people keep asking him about his next big trade. The billionaire hasn’t found anything to rival his massive short, but it’s hard to top the $20 billion that Paulson made for himself and investors when subprime mortgage bonds collapsed and ignited the worst financial crisis since the Great Depression.
***** I am sure the crypto bros have some similar sentiments for Mr. Paulson. ~JJL
China tightens scrutiny on $9.3 trillion fund industry
China’s top securities regulator pledged on Monday to crack down on mismanaged private funds and weed out fake ones, as the government becomes more assertive in dealing with an industry worth 60 trillion yuan ($9.28 trillion).
BlackRock tests Chinese retail appetite with mutual fund launch
BlackRock, the world’s largest asset manager, started selling its own mutual fund in China through a local subsidiary on Monday, tapping the fast-growing $3.6 trillion retail fund market.
Hurricane Ida wipes out power in New Orleans and batters US Gulf Coast; Louisiana residents told to hunker down as ‘life-threatening’ storm makes landfall
Justin Jacobs, William Langley – FT
One of the biggest storms to pummel the US Gulf Coast in years wiped out power in New Orleans and killed at least one person, as Hurricane Ida brought widespread devastation to Louisiana and neighbouring states.
Hurricane Ida Shut Oil Production. Why Oil Prices Aren’t Rising.
Ben Levisohn – Barron’s
Hurricane Ida knocked nearly all of the oil production in the Gulf of Mexico region. Oil prices, however, are little changed and natural gas prices are falling. Here’s what’s going on. There’s no doubt Ida was bad for oil production. Nearly 95% of oil and gas production in the Gulf had been shut down because of the hurricane, according to S&P Global Platts.
The World Is Still Short of Everything. Get Used to It; Pandemic-related product shortages — from computer chips to construction materials — were supposed to be resolved by now. Instead, the world has gained a lesson in the ripple effects of disruption.
Peter S. Goodman and Keith Bradsher – NY Times
Like most people in the developed world, Kirsten Gjesdal had long taken for granted her ability to order whatever she needs and then watch the goods arrive, without any thought about the factories, container ships and trucks involved in delivery. Not anymore.
New Zealand reports first death linked to Pfizer COVID-19 vaccine
Praveen Menon – Reuters
New Zealand reported its first recorded death linked to U.S. drugmaker Pfizer’s COVID-19 vaccine, the health ministry said on Monday, after a woman suffered a rare side-effect leading to inflammation of the heart muscle.
‘Me, me, me my body’: LinkedIn users exchange heated comments over vaccine mandates
Sibile Marcellus – Yahoo Finance
LinkedIn posted a poll on Aug.19 asking workers if employers should mandate their employees be fully vaccinated before returning to the workplace. The poll promptly went viral and garnered tens of thousands of comments and likes before closing on Aug. 26. Emotions are still flaring up as additional comments were added on Friday.
Antibodies Waning? The Immune System Has a Backup Plan For That
Jason Gale – Bloomberg
Moderna and Pfizer vaccines spur immune memory response: study; Memory B cells can train antibodies to block virus variants
Antibodies against the coronavirus wane over time, but the immune system has a backup plan that doesn’t rely on boosters, according to a study by scientists at the University of Pennsylvania, where technology for mRNA vaccines was developed.
Japan Probing Deaths of Two People Who Had Moderna Shots
Yuko Takeo – Bloomberg
Health minister tells NHK that investigation is still ongoing; Okinawa suspends some shots after noticing debris in batches
Japan is investigating the deaths of two people who were administered Moderna Inc.’s Covid-19 shots from vaccine batches which have since been suspended.
Covid-19 Boosters Work at Curbing Severe Cases, Israel Data Show
Jason Gale – Bloomberg
Third jab linked to 11.4-fold reduction in infection risk; Risk of severe illness may be lowered at least 10-fold: study
A third Covid vaccination shot appeared to significantly curb a delta-led surge in cases and prevent severe illness, according to a study in Israel, the first country to offer boosters to seniors.
Delta-driven Covid surge puts renewed strain on US hospitals; Hospitalisations top 100,000 and seven-day tally of infections surpasses 1m for first time since January
Peter Wells – FT
US hospitals in some states are once again strained by the latest surge in Covid-19, illustrating the heavy toll taken in parts of the country as infections near levels last seen during the heights of the pandemic in January. More than 78 per cent of hospital beds are occupied currently, according to data from the US Department of Health and Human Services. Covid-19 patients occupy more than 100,000 beds for the first time since January 30, representing 13 per cent of available capacity.
U.S. Records a Daily Average of 100,000 Covid Hospitalizations
The influx of patients across the country has not been this high since the winter, before vaccines were widely available. In Australia, the state of New South Wales registered a record rise in cases.
New Covid Variant Found in South Africa Has Concerning Mutations
Antony Sguazzin – Bloomberg
C.1.2. variant identified in May, spread to seven countries; Mutation types associated with increased transmissibility
South African scientists said they identified a new coronavirus variant that has a concerning number of mutations. The so-called C.1.2. variant was first identified in May in the South African provinces of Mpumalanga and Gauteng, where Johannesburg and the capital, Pretoria, are situated, the scientists said in a research paper. It’s since been found in seven other countries in Africa, Oceania, Asia and Europe.
Exchanges, OTC and Clearing
HKEX and Guangzhou Futures Exchange to explore possibility of developing products to support China’s climate goal
Enoch Yiuenoch. – South China Morning Post
Bourse operator Hong Kong Exchanges and Clearing (HKEX) on Friday signed an initial agreement with Guangzhou Futures Exchange (GFEX) to explore the feasibility of developing products that support China’s aim of achieving its carbon neutrality goal.
NYSE US Exchanges To Close In Observance Of Labor Day
In observance of Labor Day, the New York Stock Exchange, NYSE American Equities, NYSE Arca Equities, NYSE Chicago, NYSE National, NYSE American Options, NYSE Arca Options, and NYSE Bonds markets will be closed on Monday, September 6, 2021.
ICE Announces That a Record 20,723 Micro NYSE FANG+™ Index Futures Traded on August 26
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of data, technology, and market infrastructure, today announced that a record 20,732 Micro NYSE FANG+™ Index futures traded on August 26, marking its highest volume day. Average daily volume has grown to a record 8,423 contracts in August.
Passive Liquidity Protection – ensuring a level playing field
Jonas Ullmann, Member of the Executive Board and Chief Operating Officer at Eurex, explains the major benefits and successes of Passive Liquidity Protection (PLP) and what is next in terms of functionality.
Toronto Stock Exchange, TSX Venture Exchange, TSX Alpha Exchange and Montréal Exchange Closed for Labour Day
Toronto Stock Exchange, TSX Venture Exchange, TSX Alpha Exchange and Montréal Exchange will be closed on Monday, September 6, 2021 for the Labour Day holiday.
Results of the Survey of Overseas Investors on English Disclosure by Japanese Companies
Recently, to gain information to use in research on how to enhance English disclosure by Japanese listed companies, Tokyo Stock Exchange, Inc. (TSE) conducted a survey of mostly overseas institutional investors on English disclosure. TSE has today published a summary of the survey results.
— Notice of Summary Action – MEMBER FIRM: TJM INSTITUTIONAL SERVICES, LLC, RULE VIOLATION: CBOT RULE 536.B GLOBEX ORDER ENTRY — CME
Andrea Pignataro’s Ion raises offer for Italy’s Cerved; Acquisitive fintech group increases bid for credit data and information provider by 7%
Owen Walker and Philip Stafford – FT
Ion, one of Europe’s most acquisitive fintech groups, has stepped up its pursuit of Cerved with a raised offer that values the Italian credit data and information provider at EUR2.54bn. Dublin-registered Ion, which is run from London by Italian entrepreneur Andrea Pignataro, was rebuffed by Cerved in March with an initial bid of EUR9.50 a share, which valued Cerved at EUR2.4bn including debt.
[PODCAST] Establishing the New Standard in Institutional Trading Communication
As the vast selection of collaboration tools available to institutional traders continues to grow, coupled with the accelerated adoption of emerging technologies, many firms are struggling to address the knock-on effect this is having on trader workflows. In the seventh episode of Cloud9’s podcast series examining developments in the voice trading landscape, Cloud9’s Chief Operating Officer Jim Miller and Symphony’s Chief Product Officer Michael Lynch examine how fragmented workflows can be solved by consolidating trading tools with voice capabilities and how Symphony’s recent acquisition of Cloud9 is playing a key part in alleviating challenges.
Fintech and digital banking searches have been on the rise
Spencer Tierney – MarketWatch
If internet searches can serve as a kind of popularity contest, the banking institutions that have seen the sharpest surge of attention in the past five years aren’t the biggest U.S. banks. They’re the financial technology — or “fintech” — companies that became particularly appealing during the pandemic. Searches for digital banking features, such as mobile check deposits, also grew as U.S. banking habits shifted further away from in-person transactions.
Cyber Security Today, Aug. 30, 2021 – A new ransomware strain with a trick, a warning for Azure Cosmos administrators and more on the T-Mobile hack
Howard Solomon – IT World Canada
A new strain of ransomware uses a trick to evade detection. According to cybersecurity company Sophos, instead of encrypting all the bytes of a file the LockFile strain only scrambles every 16 bytes of a file. That way the partly encrypted files look similar to the uncompromised original file. As a result, it evades the statistical file analysis some ransomware protection applications perform when comparing files.
Researchers, cybersecurity agency urge action by Microsoft cloud database users
Joseph Menn – Reuters
Researchers who discovered a massive flaw in the main databases stored in Microsoft Corp’s (MSFT.O) Azure cloud platform on Saturday urged all users to change their digital access keys, not just the 3,300 it notified this week. As first reported by Reuters, researchers at a cloud security company called Wiz discovered this month they could have gained access to the primary digital keys for most users of the Cosmos DB database system, allowing them to steal, change or delete millions of records.
Why You Suddenly Need To Delete Google Chrome
Zak Doffman – Forbes
A shocking new tracking admission from Google, one that hasn’t yet made headlines, should be a serious warning to Chrome’s 2.6 billion users. If you’re one of them, this nasty new surprise should be a genuine reason to quit. Behind the slick marketing and feature updates, the reality is that Chrome is in a mess when it comes to privacy and security. It has fallen behind rivals in protecting users from tracking and data harvesting, its plan to ditch nasty third-party cookies has been awkwardly postponed, and the replacement technology it said would prevent users being profiled and tracked turns out to have just made everything worse.
Anxinsec proposed a protection solution for advanced threats to defend against 0-day exploits and fileless attacks
Anxinsec (Beijing) Technology Co., Ltd – PR Newswire
In the Beijing Cyber Security Conference 2021 from August 26th to 28th, Anxinsec was invited to attend along with more than 200 top domestic and international cyber security experts. During the conference, Anxinsec, a pioneer and leader in memory protection, presented a novel solution to prevent advanced threats.
Another cyber executive order deadline looming for agencies
Jason Miller – Federal News Network
The Office of Management and Budget is giving agencies 60 days to assess how well they log cybersecurity incident data against a new maturity model released today. As part of that review, agencies must also identify gaps, develop plans to mitigate those problems and submit cost estimates to OMB’s Resource Management Office (RMO) and Office of the Federal Chief Information Officer (OFCIO).
Companies with the most bitcoin on their balance sheets
Ines Ferré – Yahoo Finance
MicroStrategy (MSTR) recently doubled down on bitcoin (BTC-US) by once more adding more of the cryptocurrency to its balance sheet. The analytics platform now owns the most bitcoin out of all publicly traded companies.
Dubai Poised to Benefit From Cryptocurrency Growth, Bittrex Says
Farah Elbahrawy – Bloomberg
Dubai is well-positioned to benefit from the growing cryptocurrency market in the Middle East as its regulators lead a push toward acceptance of blockchain-based technologies, according to Bittrex Global’s chief executive officer.
Hottest Crypto Coins Are the Bitcoin and Ether Alternatives
Vildana Hajric and Olga Kharif – Bloomberg
Tokens from Ethereum blockchain rivals lead the gains; Downloads for cryptocurrency trading apps are climbing again
FOMO remains alive and well in the cryptocurrency world, with lesser-known tokens outperforming again in the wake of recent rallies staged by industry leaders Bitcoin and Ether. Cardano has doubled this month, becoming the third-largest digital asset. Binance Coin is also up. A token named Avalanche has tripled in August. Meanwhile, prices for digital photos of rocks with laser eyes and cartoon depictions of cute animals are going gangbusters, sometimes quadrupling in a matter of days.
How Solana and Pyth Aim To Take DeFi to the Next Level; Understanding one of the hottest ETH-killers around
Tracy Alloway and Joe Weisenthal – Bloomberg
Joe Weisenthal and Tracy Alloway analyze the weird patterns, the complex issues and the newest market crazes. Join the conversation every Monday and Thursday for interviews with the most interesting minds in finance, economics and markets.
Most Used Blockchain Averts Crisis After Software Flaw Is Fixed
Kartikay Mehrotra – Bloomberg
Ethereum blockchain was divided by mistake in client software; Network patch swiftly stabilized the blockchain system
A flaw in the most popular software used to verify transactions on the Ethereum network nearly triggered a crisis for the world’s most widely used cryptocurrency blockchain. About half of the Ethereum ecosystem split into a separate chain after a bug in the Go Ethereum, or Geth, software effected users who hadn’t implemented an update meant to fix the mistake, said Maddie Kennedy, a spokesperson at the cryptocurrency research firm, Chainalysis.
Binance warning highlights crypto risks for savers; Regulator leaves exchange free to keep operating despite misgivings
Eva Szalay – FT
The lack of protection given to digital asset investors was highlighted this week by the UK financial regulator’s move to brand the world’s largest cryptocurrency exchange as “not capable of being effectively supervised”.
Mass Migrations Could Yet Bring Europe Down; Events in Afghanistan and Belarus are just the latest reminders that the European Union is weak, hypocritical and largely defenseless against the migrations to come.
Andreas Kluth – Bloomberg
There must be no repeat of 2015. That’s been the refrain from politicians across the European Union as they watch the unfolding humanitarian disaster in Afghanistan, which can be expected sooner or later to cause renewed mass migration.
Trudeau Pledges Tighter Rules for Oil Companies to Cut Emissions
Kait Bolongaro – Bloomberg
Prime Minister Justin Trudeau said his government would require Canada’s oil and gas sector to set benchmarks to reduce emissions if he is re-elected. In a platform published Sunday, the Liberals pledged to force oil and gas companies to set five-year targets to cut their emissions with the aim of reaching net zero emissions by 2050. The program would begin in 2025. Part of the plan includes a C$2 billion ($1.6 billion) fund to create green jobs in oil-producing regions.
EU Set to Recommend Halting Nonessential Travel From the U.S.; The European Union action is in response to the increase in U.S. coronavirus cases
Laurence Norman – WSJ
The European Union is set to recommend halting nonessential travel from the U.S. because of the spread of Covid-19, diplomats said on Sunday. European officials have been considering the move for much of the last month, with the average U.S. infection rate now above that of the EU.
We Need Clear Goals for Every Covid-19 Policy
Joseph G. Allen and Helen Jenkins – NY Times
While the availability of vaccines refocused the U.S. response to the pandemic, many policy questions remain. Should vaccinated people get boosters? Does everyone need to wear a mask? Are unvaccinated children safe in schools?
It’s Now or Never. Biden Must Stop Putin’s Beloved Pipeline.
Mark Temnycky – NY Times
For the first time in over four years, a Ukrainian president is coming to the White House. On Tuesday, President Volodymyr Zelensky of Ukraine will meet with his American counterpart. They’re likely to cover a variety of issues: the state of relations with Russia; Ukraine’s fight against corruption; and the challenges of the pandemic. After thanking President Biden for America’s continued support and assistance, the Ukrainian leader may gently inquire about NATO membership.
NFA Proposes to Amend the Branch Office Definition, Embraces the ‘New Normal’ of Remote Working for CPOs and CTAs
Akin Gump Strauss Hauer & Feld LLP
Beginning as early as September 2, 2021, a “branch office” for NFA purposes will exclude any remote working location not held out to the public as a CPO or CTA office where one or more APs from the same household work remotely, subject to certain conditions. Recognizing the lasting impact of COVID-19 on remote working, the National Futures Association submitted to the Commodity Futures Trading Commission proposed amendments to NFA Interpretive Notice 9002 entitled “Registration Requirements: Branch Offices.”1 The Proposal will become effective as early as September 2, 2021, unless the CFTC determines to engage in a formal review and approval process.
Federal Court Orders Ohio Resident and Multi-Million Dollar Ponzi Scheme Fraudster Permanently Banned from Trading and Registering with the CFTC
The Commodity Futures Trading Commission announced today that Judge Michael R. Barrett, of the U.S. District Court for the Southern District of Ohio entered a Consent Order for Permanent Injunction and Other Equitable Relief against Glen Galemmo finding, among other things, that Galemmo fraudulently solicited individuals to place funds in a commodity pool to trade commodity futures, commodities, stocks and bonds and misappropriated millions of dollars. The order imposes on Galemmo permanent trading and registration bans.
Beijing has a new legal architecture for sweeping control over user data
Jane Li – Quartz
For years, China, like other countries, has been exploring ways to harness and also secure the power of the vast troves of data held by companies and government agencies. In July, when it launched a cybersecurity probe into ride-hailing giant Didi Chuxing, many saw it as the start of a new era for state control over data in China.
Exclusive: China’s FX regulator surveyed banks, companies on yuan risk – sources
China’s currency regulator has been conducting a rare survey of banks and companies to ask about their risk management processes and ability to handle volatility in the yuan, three banking and policy sources told Reuters.
SEC Issues Whistleblower Awards Totaling $2.6 Million
The Securities and Exchange Commission today announced awards of approximately $2.6 million to five whistleblowers who provided information and assistance in three separate enforcement proceedings. In the first order, the SEC awarded approximately $1.2 million to a whistleblower who provided valuable independent analysis based upon a complex algorithm the whistleblower developed and applied to publicly available data. The whistleblower’s information saved Commission staff time and resources and assisted the staff during settlement negotiations of an enforcement action.
SEC Requests Information and Comment on Broker-Dealer and Investment Adviser Digital Engagement Practices, Related Tools and Methods, and Regulatory Considerations and Potential Approaches; Information and Comments on Investment Adviser Use of Technology
The Securities and Exchange Commission today announced that it is requesting information and public comment on matters related to the use of digital engagement practices by broker-dealers and investment advisers. These tools include behavioral prompts, differential marketing, game-like features (commonly referred to as gamification), and other design elements or features designed to engage with retail investors on digital platforms (e.g., websites, portals, and applications), as well as the analytical and technological tools and methods (collectively called digital engagement practices (DEPs)).
Investing and Trading
Five potential bubbles that may be about to burst
Tim Wallace – The Telegraph
If you own your home, you may have noticed that the roof above your head has been growing more valuable at a startling rate. Almost every part of the property market – some London flats excepted – is booming. Prices in June were up more than 13pc on the year, the fastest pace since 2004.
Dragons fly as Chinese millennials take a shine to gold
Emily Chow – Reuters
For many affluent young Chinese consumers, modern simplicity is out and tradition is back in when it comes to jewellery. Sales of gold bracelets, pendants, earrings and necklaces that draw on dragons, phoenixes, peonies and other traditional Chinese patterns and symbols are flying among consumers, especially those in their 20s and 30s, helping drive a rebound in gold demand in the country after a pandemic-induced slump.
Overlooked IPO Markets Are Suddenly Booming as China Deals Slow
Julia Fioretti and Ishika Mookerjee – Bloomberg
China’s crackdown on technology companies is prompting global investors to look for new opportunities across Asia, contributing to a record jump in initial public offerings from India to South Korea that shows few signs of slowing.
Options Turn Upheavals Into a Mid-Month Sure Thing for S&P 500
Yakob Peterseil – Bloomberg
What can you say about a stock market grown so predictable that even its bouts of chaos now occur at regular intervals? A lot, when options whizzes get involved. A mid-month storm of volatility has emerged as a semi-predictable occurrence recently, a presence once recognizable only to specialists but now drawing the attention of an ever-larger crowd on Wall Street.
Rich Friends Who Helped Evergrande Tycoon Count Their Losses
Blake Schmidt and Venus Feng – Bloomberg
Poker pals and other wealthy investors bought shares, bonds; Evergrande shares have plunged on concern over debt repayment
Wealthy investors who supported Chinese billionaire Hui Ka Yan’s empire are now paying a heavy price amid growing concern the group will struggle to repay its debts. Hui had long been able to count on his poker pals to back China Evergrande Group during times of trouble, whether it was by buying stakes in his company, loading up on its bonds or not calling in debts. He broadened that circle to raise funds for his property services business in December, as well as an electric-vehicle startup in January.
How Sports Trading Cards Became a Multibillion-Dollar Asset Class
The market for trading cards exploded during the pandemic. A once-innocent hobby has been transformed by seven-figure valuations and fractional investment. How did this American pastime go so Wall Street?
Debunking the Hemline Index
Is fashion and a fast recovery a miss or match? Bloomberg’s Irina Anghel visits a luxury department store to debunk the Hemline Index.
Yale’s low-key new fund chief embodies daring investment style; The 36-year-old Mendelsohn has been appointed at a time when private investments are growing in prominence
Robin Wigglesworth and Miles Kruppa – FT
To understand how a young, low-key and geeky Midwesterner this week landed the job of following the hugely respected David Swensen as head of Yale’s endowment, industry insiders point to how the fund has evolved over the years
Investor divisions over Israel risk conflict for companies;The fierce backlash from US state funds over Ben & Jerry’s boycott underscores diverging demands from shareholders
Attracta Mooney, Laurence Fletcher and Judith Evans – FT
Ben & Jerry’s decision to pull out of occupied Palestinian territories spurred one Israeli cabinet minister to upload a TikTok video of herself binning its ice cream in protest. Now, a series of US pension funds are looking at dumping the entire company.
The Full FX Podcast: Currency Matters
Colin Lambert. – The Full FX
In the latest edition of the podcast, Colin Lambert talks to Eric Huttman, CEO of MillTechFX, a business seeking to bring the benefits of multi-bank liquidity to lower tier asset managers and corporates.
Environmental, Social and Corporate Governance
Beyond human endurance ; How climate change is making parts of the world too hot and humid to survive
Ruby Mellen, William Neff – Washington Post
When it comes to heat, the human body is remarkably resilient — it’s the humidity that makes it harder to cool down. And humidity, driven in part by climate change, is increasing.
A Tale of Two Wildfires: Lessons From Europe’s Blazing Summer; As the planet warms, fires are only going to get worse. We need to be prepared.
Laura Millan Lombrana – Bloomberg
Growing up in Catalonia, along the shores of the Mediterranean Sea, meant bumpy bike rides, long siestas and many, many memories of fire. Some are good, like jumping over bonfires as we celebrated the summer solstice, or teasing fire-spewing beasts and demons at local festivals. Others are less so—the hideous breath of a wildfire closing in on a village on an August evening, my father volunteering to help firefighters put out the embers armed with just a pair of gloves and a carton of milk to clear his throat of smoke and ash.
Lake Tahoe Threatened By Massive Fire, More Ordered to Flee
Fire officials ordered more evacuations around the Tahoe Basin Sunday evening as crews dealt with a two-week old blaze they said was “more aggressive than anticipated,” and continued to edge toward the pristine waters of Lake Tahoe.
Saudi Arabia’s grandiose climate plans struggle to take off; Sceptics question whether kingdom’s pledge to lead ‘next green era’ will be matched with tangible action
Andrew England and Camilla Hodgson – FT
When Crown Prince Mohammed bin Salman announced Saudi Arabia’s “green initiative” this year he did so with the type of eye-catching pledge that has come to characterise the young royal’s grandiose plans to modernise the kingdom.
Corporate bonus culture impedes the push for net zero; Global investment community’s commitment to sustainability is more ambiguous than meets the eye
John Plender – FT
Governments across the world are urging big investors to galvanise the global corporate sector into meeting climate change goals. A growing number of asset owners and managers have taken their cue and are committing to secure an overall balance between greenhouse gas emissions produced and emissions taken out of the atmosphere — net zero.
European sunshine fuels solar power record; Solar panels produced almost a tenth of the EU’s electricity in June and July
Liz Faunce and Camilla Hodgson – FT
Solar panels produced nearly 10 per cent of the EU’s electricity during this year’s sunny summer months, a marked increase from just over 6 per cent three years ago, according to data from energy think-tank Ember. Eight countries in the 27-nation bloc, including Germany and Spain, set new solar records in the months of June and July.
Big Four accounting firms rush to join the ESG bandwagon; New investment plans and strategies aim to tap sustainability boom but fears of backlash persist
Michael O’Dwyer and Andrew Edgecliffe-Johnson – FT
The sustainability boom has moved trillions of dollars into environmental, social and governance funds and brought a new stakeholder-led agenda to corporate boardrooms.
Goldman, JPMorgan Among Banks Hired for India’s Blockbuster IPO
Baiju Kalesh and Suvashree Ghosh – Bloomberg
Goldman Sachs Group Inc., JPMorgan Chase & Co. and ICICI Securities Ltd. were among banks picked to work on Life Insurance Corp. of India’s initial public offering, in what’s set be the nation’s biggest listing.
Frictions arise between Wall Street and private equity clients; ‘Financial sponsors’ increasingly press their advantage against investment banks
Sujeet Indap – FT
In the legal mudslinging between Leon Black and a woman with whom he once had an extramarital relationship, a curious third party appears: Goldman Sachs. In legal papers, the Apollo Global Management co-founder and the woman, Guzel Ganieva, agree that the venerable investment bank interviewed her for an entry-level position in 2014 at Black’s behest.
ETF pioneer Grossman urges asset managers to adopt direct indexing; Former iShares chief says investment houses are often slow to consider new technology
Michael Mackenzie – FT
One of the pioneers of exchange traded funds said traditional asset managers must embrace innovations such as simple bespoke portfolios and give up on a “fantasy land” belief in a comeback for active fund management.
Chinese Bad-Debt Manager Huarong Confirms $16 Billion Annual Loss; Firm says it has learned a harsh lesson after taking huge writedowns
Xie Yu and Frances Yoon – WSJ
China’s top manager of distressed assets, China Huarong Asset Management Co., confirmed it made a net loss of roughly $16 billion last year, and warned investors that it fell short of regulatory requirements on financial strength. The publication of the 2020 results is a key step in the rehabilitation of Huarong. The company, a major borrower in international bond markets, had rattled global investors earlier this year after it delayed the release of its annual results.
Swiss Canton Gives 100 Bottles of Wine to 100-Year-Olds
Andy Hoffman – Bloomberg
If residents of the Swiss canton of Fribourg make it to the age of 100, the government gives them plenty of help celebrating. Centenarians are offered 100 bottles of local wine for reaching the milestone, Swiss newspaper Le Matin Dimanche reported.
Bitter brew for coffee roasters as Vietnam adds to Brazil woes; Prices jump after strict lockdown rules cause problems getting beans out of the country
Emiko Terazono and Judith Evans – FT
Leading coffee roasters have been dealt a blow as a strict lockdown in Vietnam, the world’s second-biggest grower, has led to higher bean prices on the back of worries about export supplies.
Fortescue unveils $8bn in dividends on booming China demand; Australian miner reports record profits of $10bn after iron ore price soars
William Langley – FT
Fortescue Metals Group said it would pay out $8bn in dividends as the Australian miner posted record annual iron ore shipments and net profits after tax on the back of the economic rebound in China.
Covid-19 Surge in Asia Threatens Manufacture of Ceramic Bits in iPhones and PlayStations; Top maker of tiny critical component shuts factory for week, highlighting role of the ‘rice’ of electronics
Jiyoung Sohn and Yang Jie – WSJ
Hidden inside the newest smartphones are more than a thousand tiny bits of ceramic to control the flow of electricity. Inside an electric vehicle, there are more than 10,000. They are called MLCCs, for multilayer ceramic capacitors, and the surge of Covid-19 infections across East Asia is raising the risk that factories won’t be able to make enough of them.
China Curbs Steel Output, but Familiar Economic Pressures Test Its Mettle; A sharp two-month drop in production has tanked global-iron ore prices and burnished China’s climate credentials
Chuin-Wei Yap – WSJ
A two-month fall in China’s steel output, ordered by economic officials, handed Beijing a global showcase for advancing climate goals and controlling commodity markets. A brewing economic slowdown is testing the government’s will to sustain the cuts.
Eight Exercises to Build Power and Improve Your Tennis Game; Training to develop power could give you an edge on and off the court
Jen Murphy – WSJ
Emerging U.S. tennis star Taylor Fritz is known for his big hits on the court. He clocked the fastest serve of the 2020 U.S. Open at 147 miles an hour and will be looking to top that when this year’s tournament kicks off in New York on Monday. The power needed to crush a ball at that speed is generated from strength in the lower body, says Gena Ball, an L.A.-based strength and conditioning coach with the U.S. Tennis Association who works with Mr. Fritz. “You want to use the biggest muscles in the body, the legs, to produce the initial power flow through the core, shoulders and hands,” she says.
A Retired Hedge Funder Wants $160 Million for His 22-Acre California Compound; If the sprawling property overlooking the Pacific Ocean sells for its asking price, it would be one of the most expensive to ever sell in the state
E.B. Solomont – WSJ
Retired hedge-fund manager Bruce Kovner spent 14 years developing, renovating and building a sprawling family compound on a bluff near Santa Barbara. “It started at 3½ acres and, with a great deal of fertilizer, it grew to 22,” he quipped. Now, he and his wife Suzie Kovner are looking to sell the California retreat for $160 million.