Beijing summons top Wall Street bankers for tariff talks; Life lessons from Lehman

Sep 10, 2018

Beijing summons top Wall Street bankers for tariff talks; Life lessons from Lehman

Sep 10, 2018

First Read

Hits & Takes
JLN Staff

The 85th Annual Market Structure Conference from the Securities Traders Association, titled “Shaping the Future” will be on October 3 to 5 at the JW Marriott in Washington, DC. Charlie Cook, Political Analyst and Editor of The Cook Political Report will be Friday’s featured speaker.

FIS is holding a webinar SPOTLIGHT: Margin in 2018” on September 13.~JJL

The CTA Expo this week is presenting Leo Melamed with the seventh CTA Expo Lifetime Achievement Award for his contributions to the managed futures industry.~JJL

CME Group’s Tim McCourt gave a terrific MarketsWiki Education World of Opportunity presentation. Don’t miss it.~JJL

MarketsMedia reported James Leman, FIX Pioneer, died at 72.~jJJL

A 20-point lead is not enough against Aaron Rodgers, so learned the Chicago Bears.~JJL

Former Treasury Secretary Larry Summers called the results of the Fed’s latest stress tests
“comically absurd.” ~SD

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IFM

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Understanding the Market for U.S. Equity Market Data
Charles M. Jones is the Robert W. Lear Professor of Finance and Economics, Columbia Business School
A stock exchange facilitates share trading, in large part by developing computer systems, rules, and processes that allow buyers and sellers to submit orders, trade with each other, and determine a market price for shares listed on those exchanges. In the current market environment, this results in a vast amount of data, which market participants of all types rely on to make investment and trading decisions. Exchanges provide some of this market data to market participants at prices that vary depending on the type of data as well as how the data is
used.
/jlne.ws/2oV6GCk

***** Interesting whitepaper worth a read.~JJL

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The Spread – The Colo Down-low – 9/7
JohnLothianNews.com

“The Spread” hasn’t covered Aurora, Ill. during its time on the web. We tick that box in this week’s recap.

Watch the video and see the stories referenced here »

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Bridging the Week: Quantitative Models; Cross-Border Swaps Guidance; The Meanings of “Or” and “Actual Delivery”
Gary DeWaal
Four related Securities and Exchange Commission-registered investment advisers and/or broker-dealers agreed to pay a collective penalty close to US $100 million to resolve charges related to their purported implementation and use of quantitative trading models for funds and individual managed accounts that, prior to launch, were never formally validated and never fully worked as intended. Moreover, the SEC claimed that the companies did not uniformly alert investors after they discovered the models’ errors and discontinued their use. Separately, the Chairman of the Commodity Futures Trading Commission promised to soon issue a white paper as guidance to staff to propose rules to substantially modify the Commission’s 2013 Cross-Border Swaps Regulation Guidance.
/goo.gl/F74QpE

***** Try to imagine Gary DeWaal speaking this information. Can you do it without an image of him wearing his fishing vest?~JJL

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NFA Board UpdateóAugust 2018 Meeting
NFA
NFA Vice-Chairman Maureen Downs and President Tom Sexton discuss highlights and other notable information from NFA’s August Board meeting, including Chairman Giancarlo’s visit to NFA’s Chicago offices, NFA’s Fiscal Year 2018 accomplishments, and NFA’s progress toward developing and implementing proficiency requirements for swap associated persons. This video is intended to keep NFA Members and the investing public apprised of the important topics discussed by NFA’s Board.
/jlne.ws/2NSKZ0x

***** The NFA never sits still, except when shooting this video.~JJL

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Friday’s Top Three
Our top read story on Friday was the Imperial College of London’s map of potential returns and adoption of various crypto assets in the Financial Times’ The crypto periodic table (sigh). Second was the new website for Cumberland, DRW’s crypto asset subsidiary. Holding in the top three was the JLN column from Jim Kharouf on TT, and what’s next for the firm in X_TRADER Transformed The Industry: Now It’s Time To Do It Again

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MarketsWiki Stats
132,186,388 pages viewed; 23,271 pages; 214,863 edits
MarketsWiki Statistics

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CryptoMarketsWiki Website»
CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.

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Lead Stories

Beijing summons top Wall Street bankers for tariff talks; Hastily-arranged meeting by Chinese government comes amid Trump trade stalemate
Tom Mitchell – FT
The Chinese government is inviting Wall Street’s top bankers to a hastily arranged meeting in Beijing as President Donald Trump threatens to impose punitive tariffs on all Chinese exports to the US.
/jlne.ws/2oUoei3

Life lessons from the people who worked at Lehman Brothers; Junior staff at the time of the bank’s collapse talk about how it has affected them
Emma Jacobs in London – FT
On the morning of September 15 2008, Nadia-Elisabeth Seemuth, an analyst in Lehman Brothers’ fixed income division, heard that her employer had filed for bankruptcy. She remembers looking at the office walls, thinking: “It doesn’t exist any more. The whole thing. It’s a sham.”
/jlne.ws/2oSOOIm

Bitcoin Tracker One and Ether Tracker One Suspended by U.S. SEC
Jesse Westbrook – Bloomberg
Agency cites investor confusion in halting trading of assets; Brokers who allow trading could be subject to sanctions: SEC
The U.S. Securities and Exchange Commission temporarily suspended trading in two securities linked to cryptocurrencies on Sunday, citing investor confusion regarding the assets.
/jlne.ws/2oW2nXK

The Financial Crisis Made Us Afraid of RiskóFor a While; Risk-taking never disappears, it just changes shape, often to slip past the institutional and psychological defenses erected after the last crisis.
Greg Ip – WSJ
Ten years ago this month, the failure of Lehman Brothers exposed how cavalier the world had been towards risk. Households had bought homes they thought could never go down in price, banks had made loans they thought would never default and repackaged them into securities to make them seem riskless and governments, convinced depressions were a thing of the past, had stood by.
/jlne.ws/2N485F8

D.E. Shaw Partner Fights Back After Firing; Daniel Michalow, partner at $51 billion hedge fund, claims defamation and seeks hundreds of millions of dollars
Rachael Levy – WSJ
A former partner at D.E. Shaw Group, one of the world’s largest hedge funds, has filed a complaint against the firm accusing it of defaming him in communicating his firing. The complaint highlights a new challenge for employers, who in the age of #MeToo must decide what to say, if anything, upon terminating an employee alleged to have engaged in misconduct.
/jlne.ws/2N2oeLh

EU seeks new powers for money laundering crackdown; Commission plans would give European Banking Authority more investigative resources
Mehreen Khan and Jim Brunsden – FT
Brussels will seek to toughen the powers of EU agencies to crack down on money laundering and terrorist financing in the wake of high profile scandals that have shone a light on Europe’s deficiencies in tackling criminal cross-border money flows.
/jlne.ws/2MYZkfy

BlackRock to expand its private investment activities; Asset manager concerned that US stock market is being shrunk by jump in buybacks
Robin Wigglesworth – FT
BlackRock plans to ramp up its private investment activities, concerned that the US stock market is being shrunk by the surge in buybacks and a dearth of new listings but also enticed by the growing opportunities in the private debt market.
/jlne.ws/2N1VpPm

Virtu Seeks to Reprice KCG Deal’s Outstanding Loan, Prepays Additional $74M
Aziz Abdel-Wader – Finance Magnates
U.S. electronic market maker Virtu Financial Inc., which acquired KCG Holdings in a landmark deal last year, is seeking to reprice its existing senior secured term loan.
/jlne.ws/2oQoezK

Crypto Wipeout Deepens to $640 Billion as Ether Leads Declines
Adam Haigh and Eric Lam – Bloomberg
Ethereum co-founder says blockchain growth is near a ‘ceiling’; Bitcoin slips as SEC suspends two securities linked to crypto
The cryptocurrency bear market plumbed a fresh 10-month low on Monday as Bitcoin’s biggest rival tumbled and U.S. regulators suspended trading in two securities linked to digital assets.
/jlne.ws/2oXokoZ

Can We Survive the Next Financial Crisis?
Yalman Onaran – Bloomberg
Ten years ago this week, Lehman Brothers Holdings Inc. collapsed, triggering the worst financial crisis in almost a century, a seismic event that still reverberates today.
/jlne.ws/2N2neH1

In a crisis, sometimes you don’t tell the whole story; How after the fall of Lehman Brothers we came close to a full-scale bank run
John Authers – FT
It is time to admit that I once deliberately withheld important information from readers. It was 10 years ago, the financial crisis was at its worst, and I think I did the right thing. But a decade on from the 2008 crisis (our front pages from the period are at ft.com/financialcrisis), I need to discuss it.
/jlne.ws/2oTChV9

Number of SEC-registered advisers grows as assets managed swell; The largest advisory firms are winning market share from their smaller competitors
Chris Flood – FT
The US wealth management industry is booming with both the number of federally registered investment advisers and the assets they manage reaching record highs this year.
/jlne.ws/2oWNjJm

Exchanges, OTC and Clearing

Connect helps drive inclusion of Chinese assets into international indices
Charles Li – HKEX
Stock Connect and Bond Connect have both been given big stamps of approval over the past few weeks as global index compilers add Chinese assets into their major international benchmark indices for the first time.
/jlne.ws/2N4zffl

Aquis makes Brexit play with new Paris venue application; Pan-European cash equities trading MTF files applications with French regulators from new trading venue.
Jonathan Watkins – The Trade
Aquis Exchange is planning to set up a new venue in Paris in order to provide services to its European members following Brexit.
/jlne.ws/2oSflpf

Deutsche Boerse and 360T launch new FX market data service; German exchange group continues FX growth with new market data service from 360T.
Jonathan Watkins – The Trade
Deutsche Boerse and 360T have announced the launch of a market data product covering FX spot and swap markets.
/jlne.ws/2oXwZYx

Deutsche Boerse Group expands its engagement in Asia
Eurex
To further strengthen its activities in China, Deutsche Boerse Group teams up with Zhengzhou Commodity Exchange. The strategic partnership will focus on the futures market and is intended to create a strong bond between Zhengzhou Commodity Exchange and Eurex, Europe’s largest derivatives exchange that is part of Deutsche Boerse Group.
/jlne.ws/2oWjyIB

SGX reports market statistics for August 2018
SGX
Securities – Total Securities market turnover value was at S$23.5 billion, down 4% month-on-month (m-o-m) and down 9% year-on-year
Derivatives – Total Derivatives volume was 18.79 million, up 11% month-on-month (m-o-m) and up 18% year-on-year (y-o-y).
/jlne.ws/2N1Ny4l

Fintech

IPC Expands GreenKey Partnership, Striking Financial Markets Software Co-Development Agreement
IPC- GreenKey
IPC, a leading global provider of secure, compliant communications and networking solutions for the financial markets community, and GreenKey Technologies, creator of voice-automated workflows for the financial markets, today announced they have expanded their partnership, entering into a new co-development agreement to bring to market a new, comprehensive set of tools and capabilities to enhance voice-to-text user workflows.
/jlne.ws/2CFBUY5

Why the focus is shifting to boards on cyber security; Investors are growing concerned that directors are ill-prepared for technological challenges
Attracta Mooney and Jennifer Thompson – FT
Facebook has been hit with a fine, a slowdown in user growth and a fall in its share price since news of the Cambridge Analytica data scandal broke in March.
/jlne.ws/2MYb6Hf

Fintech start-up TransferWise reports second year of profit, revenue almost doubles; TransferWise reported an annual post-tax net profit of $8 million for the fiscal year ending March 2018.
Ryan Browne – CNBC
TransferWise, one of Europe’s largest financial technology (fintech) start-ups, said Monday it was profitable for the second year in a row.
/jlne.ws/2oUkUU7

INTL FCStone Acquires SWIFT Service Bureau from PayCommerce
INTL FCStone Inc. INTL FCStone Inc. (NASDAQ : INTL ) today announced that to expand the capabilities of its Global Payments Division, it has acquired the fully accredited SWIFT Service Bureau from PayCommerce. This acquisition will now enable INTL FCStone to act as a SWIFT Service Bureau for its 350-plus correspondent banking network, thus providing another important service for delivering local currency, cross-border payments to the developing world.
/jlne.ws/2MYC55s

Broadridge launches MiFID II ex-post reporting solution for investment managers; New service set to help investment managers meet reporting obligations for the end of April 2019.
Jonathan Watkins – The Trade
Broadridge has launched a new MiFID II ex-post reporting solution for investment managers under its new FundAssist business, which it acquired in May this year.
/jlne.ws/2oUuVAH

Cryptocurrencies

Citigroup Planning Crypto Trading by Issuing Receipts
Sridhar Natarajan – Bloomberg
Citigroup Inc. has developed a new mechanism for investing in cryptocurrencies such as Bitcoin, according to a person with knowledge of the plans.
/jlne.ws/2oWHCLu

****Business Insider

‘Crypto Assets Are Here to Stay,’ Says EU Commission Vice President
Wolfie Zhao – Coindesk
The European Commission, the executive body that proposes legislation for the EU, will this year conclude a regulatory assessment for the governance of crypto assets, because they are “here to stay,” a high-level has official said.
Speaking at a press conference after a meeting of the Economic and Financial Affairs Council last Friday, Valdis Dombrovskis, vice president of the European Commission, said member states are supportive of moves to chart regulations governing the cryptocurrency industry in the economic region.
/jlne.ws/2wXvxtA

Ignorance of Crypto-Asset Prices Is Not Bliss
Dave Weisberger, CoinRoutes and ViableMkts – TABB Forum
In the financial market for crypto assets, there is a strong need for interconnections and common standards. Such interconnectedness is required for the evolution of a true ‘Open Financial System,’ which will require cooperation between key nodes in that system. Ironically, the equities market – which features centralized clearing and a bureaucratic regulatory regime – is actually a better example of decentralized trading than crypto markets.
/jlne.ws/2oLLsqG

****SD: Dave gave a great talk at our MWE event in NY.

Canadian Executive Accused of Stealing over US$5 Million in Cryptocurrency
CCN
A senior executive at a Vancouver, British Columbia-based marketing firm allegedly preyed on the ignorance of his employer regarding cryptocurrencies to take off with digital assets worth millions of dollars.
/jlne.ws/2Qgkrs3

Ethereum 2.0 Roadmap Unveiled as ETH Price Hits Yearly Low
Wilma Woo – Bitcoinist
Ethereum continues its highly mixed fortunes this week as talk of development milestones contrasts with Ether (ETH) hitting its lowest price in a year.
/jlne.ws/2QdG4cm

Fool’s Gold? Bitcoin Fork Faces Cryptocurrency Exchange Delisting after 51% Attack
CCN
Three months after Bitcoin Gold fell prey to a high-profile 51 percent attack, one of the cryptocurrency exchanges affected by that exploit is threatening to delist BTG unless the coin’s developers help cover its losses.
/jlne.ws/2Q9R8Hz

How a 81-Year-Old Billionaire’s Deals With Bitcoin Bulls Riled the SEC
Matt Robinson – Bloomberg
Opko’s Frost and Riot Blockchain CEO are among 10 sued by SEC; Agency says they made $27 million pumping up penny stocks
It’s the curious case of an 81-year-old biotech billionaire hooking up with Bitcoin bulls, and the partnership leading to all of them getting sued by the U.S. Securities and Exchange Commission.
/jlne.ws/2MZTWZU

Politics

Trump warns he could cause the ‘ruination’ of Canada
Daniel Dale – The Star
Returning to his bellicose trade rhetoric, U.S. President Donald Trump warned Friday that he would cause the “ruination” of Canada if he imposed tariffs on Canadian-made cars.
/jlne.ws/2oW5tuR

Trump’s border wall threatens to end Texas family’s 250 years of ranching on Rio Grande
Eli Saslow – Washington Post
The most recent government letter arrived in an envelope marked “Urgent: Action Required,” so Fred Cavazos asked his family to meet at their usual gathering spot on the Rio Grande. He and three of his relatives crowded around an outdoor table as Fred, 69, opened the envelope and unfolded a large map in front of them. It showed a satellite image of the family’s land, 77 rural acres on the U.S. border where Fred had lived and worked all his life, but he had never seen the property rendered like this.
/jlne.ws/2oW2sL2

Germany’s rightwing news sites pose challenge to traditional media; Alternative news outlets cater to readers disillusioned by consensus-driven journalism
Guy Chazan in Berlin – FT
“Murder in Chemnitz: sadly no isolated case.” “Left-wing extremist kept on as pre-school teacher.” “Greece celebrates while German investors are depressed.” “How Germany finances Arab terror.”
/jlne.ws/2N48ibo

When freedom takes some strange forms in Hong Kong; Hong Kong is a hyper-capitalist society, but the conditions imposed upon its people may cause them to be interested in a little socialism before long
Tim Collard – South China Morning Post
This year, for the 24th year running, Hong Kong was named the “freest economy in the world” in the US Heritage Foundation’s Index of Economic Freedom. This is an impressive tribute to the governance of Hong Kong during a potentially difficult period for the city, following the handover of sovereignty and the pioneering “one country, two systems” concept.
/jlne.ws/2oV8c7u

Bob Woodward: “People better wake up to what’s going on” in the Oval Office
CBS News
Watergate journalist Bob Woodward made headlines once again this past week, with his new book about the Trump White House, entitled “Fear.” This morning, in his first TV interview, Woodward paints a picture for our David Martin of an administration in disarray:
“You look at the operation of this White House and you have to say, ‘Let’s hope to God we don’t have a crisis,'” said Bob Woodward.
/jlne.ws/2oWs3De

The Urgent Question of Trump and Money Laundering; How Bruce Ohr, President Trump’s latest Twitter target, fits a suspicious pattern of behavior on Russia.
David Leonhardt – NY Times
Donald Trump has a long history of doing what he thinks is best for Donald Trump. If he needs to discard friends, allies or wives along the way, so be it. “I’m a greedy person,” he has explained.
/jlne.ws/2oWIK1A

Regulation

World Federation of Exchanges responds to Esma tick size consultation
Finextra.com
The World Federation of Exchanges (“WFE”), the global industry group for exchanges and CCPs, has published its response to the European Securities and Markets Authority’s (ESMA) consultation paper proposing amendments to the tick size regime in the EU with reference to third country (or, non-EU) instruments.
/jlne.ws/2CFZxzy

Larry Summers Calls Fed Bank Stress Test Results ‘Absurd’
Craig Torres and Christopher Condon – Bloomberg
Ex-Treasury secretary calls for higher capital requirements; Summers comments come at Boston Fed conference on low rates
Former Treasury Secretary Lawrence Summers called the results of the most recent Federal Reserve stress test of the largest banks “comically absurd,” and called on regulators to boost capital at financial institutions.
/jlne.ws/2N5qphu

SEC halts trading in two cryptocurrency products, citing market confusion
Trevor Hunnicutt – Reuters
The U.S. Securities and Exchange Commission said on Sunday it was immediately suspending trading in two investment products that track cryptocurrencies, citing confusion in the markets over whether the products are exchange-traded funds (ETFs).
/jlne.ws/2MY9IV3

SEC Charges Microcap Fraudsters for Roles in Lucrative Market Manipulation Schemes
SEC.gov
The Securities and Exchange Commission today charged a group of 10 individuals and 10 associated entities for their participation in long-running fraudulent schemes that generated over $27 million from unlawful stock sales and caused significant harm to retail investors who were left holding virtually worthless stock.
/jlne.ws/2wQjcYs

FCA closing more investigations than ever
Michael Griffiths – Global Investigations Review
The UK Financial Conduct Authority is dropping more investigations than ever before, but has failed to cut down its record-breaking caseload.
/jlne.ws/2N49kUO

Investing and Trading

Summers Says Zero-Rate Boundary a Larger Problem Than Recognized
Christopher Condon and Craig Torres – Bloomberg
Former Treasury chief says fiscal policies propping up rates; Neutral rate has declined even more than others have estimated
Former U.S. Treasury Secretary Lawrence Summers said interest rates in developed countries are more likely to crash back to zero in future downturns than economists have warned, which would make it difficult for monetary policy to dig economies out of recession.
/jlne.ws/2oWdj7I

Global catastrophe bond market size climbs to a record $30bn; Natural catastrophes have dented returns for investors in the sector
Oliver Ralph – FT
The catastrophe bond market has grown to a record sized $30bn, driven by investors piling into the sector, despite losses caused by last year’s run of natural disasters.
/jlne.ws/2N5pPQQ

How to pick a successful stockpicker; Analysis of a manager’s trades, rather than historic record, is key to telling if they outperform
Chris Flood – FT
Serious horseracing fans make a careful study of runners and riders’ form before placing a bet. Recent form, sadly, provides little guide to finding a successful fund manager as yesterday’s winners turn all too frequently into today’s also-rans.
/jlne.ws/2N4UjT3

Special Report; Exchange Traded Funds
FT
Passive funds gain momentum amid slow growth in challenging markets. Plus: Fidelity escalates price war; asset managers’ foray into ETF market fuels M&A; Mifid II delivers mixed results; and why second-guessing market volatility can be costly for investors
/jlne.ws/2N4dBaO

The Fiduciary Rule Is Dead. What’s an Investor to Do Now?; With regulations in flux, it’s a confusing time for those who work with investment professionals. Here’s what investors need to know.
Lisa Beilfuss – WSJ
It is a tricky time to be working with an investment professional. Regulation is in flux, and different types of professionals are held to different standards when it comes to giving advice and recommending products. So, it can be hard to know exactly what you’re paying for.
/jlne.ws/2N1bCEk

The U.S. Stock Market Towers Over the Others. But at What Cost?
Jeff Sommer – NY Times
Much of the world has recovered from the global financial crisis of a decade ago, but one market has prospered above virtually all others: the United States stock market.
/jlne.ws/2N4f2Gj

Institutions

China Invites Top Wall Street Executives to Beijing, FT Reports
Karen Leigh – Bloomberg
Meeting Sept. 16 in Beijing to discuss Sino-U.S. relations; Goldman, Citigroup, JPMorgan, Morgan Stanley chiefs invited
China has invited the U.S.’s top bankers to a quickly arranged gathering in Beijing to discuss relations between the two countries, as President Donald Trump threatens punitive tariffs on all Chinese exports to America, the Financial Times reported.
/jlne.ws/2oV3whW

Gary Shteyngart’s View From Hedge Fund Land
Mary Childs – Barron’s
The first thing you notice about Gary Shteyngart, author of novels like Super Sad True Love Story, is that he will make space for you. Whatever you just said is OK, because he has room even for that unforgivable deficiency. The second thing is that you may be providing material.
I met him at an ugly sweater party, Christmas 2013. The next day, I followed him on Twitter. When he followed me back, I was delighted, but felt bad, as if I had tricked him: I, too, am a “writer,” but about finance, and then really just credit default swaps. I messaged him, apologizing for my feed’s CDS-ness. “You know about money?” he wrote back. His next novel was going to be about hedge funds!
/jlne.ws/2oQDoVI

Trade war fears spook mutual fund investors; Investment industry heads for one of its worst years since the financial crisis
Attracta Mooney – FT
The global investment industry is on course for one of its worst years for new sales since the financial crisis as investors shun mutual funds over fears of overpriced markets, the reversal of quantitative easing and the risks of a global trade war.
/jlne.ws/2N1In4f

Deutsche Bank Won’t Be Sad to Lose This Big Shareholder; HNA, one of the German bank’s largest shareholders, was always an unstable owner
Paul J. Davies – WSJ
Clouds do have silver liningsóeven at Deutsche Bank . The German lender’s depressed stock price is likely to remain under pressure as one of its biggest shareholders, Chinese conglomerate HNA, prepares to sell its 7.6% stake, according to The Wall Street Journal.
/jlne.ws/2MYwtIi

Goldman adds bilateral derivatives as rivals cut back
Abdool Bhollah – Risk.net
Goldman Sachs grew its outstanding bilateral derivatives positions 4% to $26 trillion in the second quarter from the first, overtaking JP Morgan and Citigroup to become the bank with the largest bilateral portfolio by notional amount.
/jlne.ws/2MYwhJ4

Hedge fund Citadel replaces head of crude trading: sources
Devika Krishna Kumar, Ron Bousso – Reuters
Citadel, one of the world’s largest hedge fund managers, is replacing its head of crude oil trading, according to two sources familiar with the matter, after what one of the sources said were disappointing returns under his leadership.
/jlne.ws/2MZSd6S

BlackRock, Fidelity Launches Hit By Chinese Share Decline; The giant asset managers started stock funds in China, but early returns have been negative
Stella Yifan Xie – WSJ
Some of the world’s largest asset managers have gotten a rough welcome in China.No sooner did fund managers like BlackRock Inc. BLK -0.11% and Fidelity International roll out their inaugural Chinese stock funds for wealthy domestic investors than the country’s markets started slidingóthe Shanghai Composite index has fallen 19% this year. The declines have coincided with escalating trade tensions between China and the U.S., China’s weakening currency and a slowdown in economic growth.
/jlne.ws/2MZ2zUg

Lloyd’s of London Heading for WeWork Style Makeover, CEO Says
Gavin Finch – Bloomberg
Lloyd’s may dispense with fixed market booths for insurers; Insurance market will look nothing like it does today: Beale
Lloyd’s of London’s historic base on Lime Street is heading for a radical makeover, with more focus on shared, collaborative spaces along the lines of a WeWork Cos. office, according to its outgoing chief.
/jlne.ws/2oWgtZ3

Citigroup late in the game to merge key investment bank units; Wall Street’s other banks have long run their advisory and capital markets businesses as one unit
Robert Armstrong and Laura Noonan – FT
The question about the new organisational structure unveiled last week by Citigroup’s investment bank is not so much why changes were made, but what took the bank so long to make them.
/jlne.ws/2N4BZt9

UBS launches World Bank sustainable debt product
Katie Martin – FT
UBS has launched a new debt product backed by the World Bank and linked to sustainability goals in the latest effort to satisfy demand among rich clients for ethical investment.
/jlne.ws/2N4eyjC

Banks’ Sharing of Financial Crime Data Raises Questions on Ethics; HSBC is part of voluntary partnerships because it believes sharing is key to preserving the integrity of the financial system.
Mara Lemos Stein – WSJ
Banks, regulators and law-enforcement agencies are sharing more intelligence through voluntary networks to deter money laundering and terrorism financing. As the practice spreads, so do the risks of data mishandling, observers said.
/jlne.ws/2oWwn5q

Regions

Riksbank, not politics, is bigger drag for Sweden’s currency; Krona is the worst performing major currency versus the dollar and euro this year
Roger Blitz – FT
A cautious outlook from Sweden’s central bank this week ensured the volatile krona kept its status as this year’s worst performing major currency against the dollar and the euro ahead of weekend elections that have been dominated by the rise of a populist, far-right party.
/jlne.ws/2oUxvXj

Private equity: inside the fall of Abraaj; Once a trailblazer for emerging market investment, the group is now being picked over by liquidators
Simeon Kerr and Henny Sender – FT
It was a deal that should have provided Abraaj Group with one of its biggest ever paydays. Instead the failure to sell a majority stake in Pakistan’s K-Electric to a Chinese group has all but crippled the Dubai-based private equity group.
/jlne.ws/2MZSVB4

EU plans 10,000-strong border force to tackle migration; Cadre would have powers to bear arms and operate outside bloc
Michael Peel, Alex Barker and Mehreen Khan – FT
A 10,000-strong EU border guard force with extensive powers to bear arms and deploy inside and beyond the bloc is to be set up by 2020, according to draft plans that highlight Europe’s toughening approach to migration.
/jlne.ws/2oWbDLs

India Asks RBI to Ramp Up Efforts to Soften Rupee Drop
Anto Antony – Bloomberg
Rupee is worst Asian currency this year, sliding 11.6% so far; Decline may impact economy by increasing India’s import bill
The Indian government has asked the central bank to bolster efforts to support the rupee, Asia’s worst-performing currency of the past month, people familiar with the matter said.
/jlne.ws/2oWbkjH

They Want Their Money Back: Investors Push Back on EU Bailout; Slovenia’s 2013 bank rescue is being challenged by those forced to take losses on their holdings
Jasmina Kuzmanovic, Gordana Filipovic and Jana Randow – Bloomberg
In 2013, Slovenia rescued its failing banks by wiping out stock investors and holders of about 600 million euros ($700 million) of debt.
/jlne.ws/2oXtGk5

Brexit

EU ready to give Barnier mandate to close Brexit deal; Relief for embattled May as Salzburg summit set to tackle sticking points
Alex Barker in Brussels and George Parker in London – FT
The EU is preparing to give its Brexit negotiator new instructions to help close a deal with Britain, in a conciliatory move that will bolster Theresa May as she suffers savage attacks from Brexiters at home.
/jlne.ws/2N1FSPp

Miscellaneous

How Faking Videos Became Easy and Why That’s So Scary
Elizabeth Howcroft – Bloomberg
A minute-long video of Barack Obama has been seen more than 4.8 million times since April. It shows the former U.S. president seated, with the American flag in the background, speaking directly to the viewer and using an obscenity to refer to his successor, Donald Trump. Or rather, his lips move as the words are spoken. The video is actually a so-called deep fake made by actor-director Jordan Peele, who impersonated Obama’s voice. Peele created the video to illustrate the dangers of fabricated audio and video content depicting people saying or doing things they never actually said or did. Researchers at New York University describe deep fakes as a “menace on the horizon.”
/jlne.ws/2oVC3g7

Scotland’s Next Wave of Whisky Distilleries; With more than 50 on the horizon, here are six to keep tabs on now.

Cator Sparks – Bloomberg
It’s no secret that Scotch whisky is booming. The industry posted record-breaking exports in 2017, according to a report by the Scotch Whisky Association, growing in both volume and value (by 1.6 percent and 8.9 percent, respectively) to a total of £4.37 billion ($6.65 billion)óthe equivalent of 1.23 billion bottles exported globally. Single-malt Scotch saw 14 percent year-over-year growth to £1.17 billion, the second year in a row to break the billion-pound threshold, reflecting a trend toward premium products in global markets.
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