Beware AI euphoria

Mar 25, 2024

First Read

Hits & Takes
John Lothian & JLN Staff

Back when I took the train into Chicago every work day, as I neared downtown the rich, deep smell of burning cocoa would permeate the air as we approached the Blommer Chocolate factory. The production facility, which debuted in 1939 and is the largest cocoa processing plant in North America with more than 900 employees, will shut down its Chicago factory, according to a statement from the company reported by Crain’s Chicago Business. The company is relocating its headquarters and local research and development operation to the Merchandise Mart, it said.

Meanwhile, cocoa has been one of the hottest commodities of the last year, meaning your chocolate Easter egg prices are going to be higher this year, Bloomberg reported.

The Financial Times has a Special Report – FTfm: Exchange Traded Funds it describes as “Our latest report on the low-cost fund investments assesses the suitability of new US products holding bitcoin directly; ways to gain crypto exposure from Europe; the backlash against sustainability themes; and the rise of women in the industry.” The stories include:

Financial advisers seek guidance on recommending bitcoin ETFs; Now that ‘spot’ funds have regulatory approval, due diligence experts will help decide if they can be offered to clients

How European investors can ride the bitcoin ETF wave; US-style ‘spot’ funds are not available to retail customers on the continent – but similar products are

‘War on woke’ fails to damage the appeal of sustainable ETFs; Political rows may have slowed fund launches in US, but European investors are still investing in line with principles

Meet the fastest growing ETF firms in the US; Actively managed fund offerings are helping managers outside the Big Three to gain assets rapidly

China steps in to stem outflow from domestically focused ETFs; After a plunging stock market sent ETF pricing into turmoil, Beijing has attempted to shore up the sector

Women continue to lead the way in the ETF industry; Networking group celebrates 10 years of supporting female executives in fund management

CFTC commissioners Rostin Behnam and Kristin Johnson are headed in different directions in the coming weeks, with Chairman Behnam headed to Kansas for the 3rd Agricultural Commodity Futures Conference on April 11 and Commissioner Johnson headed to South Africa for a speech on March 25. Chairman Behnam will also host the CFTC Agricultural Advisory Committee in Overland, Kansas on April 11 in a public meeting from 9:30 a.m. to 11:00 a.m. (CDT) at the Sheraton Overland Park Hotel.

Today Commissioner Johnson delivered a keynote address focusing on the regulation of the crypto sector at the Fintech Summit hosted by the South African Reserve Bank. The event was held in Johannesburg, South Africa, and details are HERE.

Hong Kong’s observatory reported its highest March temperature in 140 years, with a maximum of 31.5°C (88.7°F), exceeding records dating back to 1884. Northern areas near Shenzhen saw temperatures surpass 32°C. The observatory anticipates above-normal temperatures this year, potentially ranking among the warmest on record. Last year, Hong Kong recorded its hottest summer with an average temperature of 29.7°C between June and August, marking all 12 months of 2023 as warmer than usual, reflecting the impact of climate change, Bloomberg reported.

Because I was on the committee that chose the FIA Hall of Fame members, I knew that my fellow committee members had voted me into the class of 2024 long before the announcement was made. When I hired a former Scout of mine, who had asked to do a one-week internship in January, one of the assignments I gave her was to interview me and create a podcast and a written piece from the interview. The written piece was published in The Patch in Elmhurst previously. On Friday, JLN published the podcast, which you can find HERE. Joanna Clohessy is a senior at Timothy Christian in Elmhurst, IL, and she is headed to Indiana University next fall to study journalism. We wanted to give her a taste of the different kinds of journalism she could do, at least in one week.

Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL

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Our most read stories from our previous edition of JLN Options were:
SGX Group seeks to refine cap on clearing members’ liability for multiple defaults from SGX.
‘Fear gauge’ within expectations, some say from Risk.net.
Is Options Selling by ETFs Distorting the VIX? Some Market Strategists Think So. from Barron’s. ~JB

Subscribe to the JLN Options Newsletter HERE (it’s free).

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Trading Technologies Unveils Growth Strategy at FIA Boca: Innovations, Acquisitions, and Expansions Set New Course in Capital Markets
JohnLothianNews.com

At the FIA International Futures Industry Conference in Boca Raton, Florida, John Lothian News interviewed Trading Technologies executives Keith Todd and Justin Llewellyn-Jones. Todd and Llewellyn-Jones shared their vision for the company’s growth, centered around innovation and evolution in the capital markets.

Watch the video »

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De’Ana Dow Reflects on Trailblazing Regulatory Career and FIA Hall of Fame Induction: From Audit Trails to Advocacy
JohnLothianNews.com

At the FIA International Futures Industry Conference in Boca Raton, FL, De’Ana Dow, partner at Capitol Counsel LLC and inductee into the FIA Hall of Fame Class of 2024, was interviewed by John Lothian News. Dow expressed surprise at her Hall of Fame nomination, saying, “I was completely shocked… never in a million years did I think I’d be considered, let alone selected.”

Watch the video »

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There Can (Probably) Be Only One Bitcoin
Paul Brody – CoinDesk
One of my key questions about the next era in crypto and blockchain is this: How will all the capital likely be deployed into digital assets and cryptocurrencies as they become better regulated? More than 90% of the world’s financial and business assets are considered “on-shore” – that is, they are owned and managed by entities and people residing in the countries where they are bought and sold.
/jlne.ws/43xlfi7

****** Interesting commentary about the differences between bitcoin and ethereum.~JJL

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Why Did a Billionaire Snap Up Homes on a Sandbar in Duluth? Kathy Cargill kept mum about her plans for Park Point, but after a letter from the mayor she is talking
Joe Barrett – The Wall Street Journal
When the wife of a billionaire heir to the Cargill food company fortune paid $2.5 million for a home in a funky neighborhood of beach bungalows in this Lake Superior port, it didn’t draw much notice. But after Kathy Cargill, wife of James R. Cargill II, started buying up multiple additional homes unconnected to the original parcel on Park Point, alarms went off for many residents of the 7-mile strip of sand near Duluth’s main tourist area, with popular beaches and a city park.
/jlne.ws/3TzbPOm

***** Small town inhabitants can get a little touchy when someone buys up a bunch of properties for above going prices and is silent about their plans.~JJL

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Friday’s Top Three
Our top story Friday, by several lengths, was US warns hackers are carrying out attacks on water systems, from Reuters. Second was Record rise in concentration at top CCPs leads to all-time high, from Risk.net. Third was Three Takeaways from FIA Boca 2024 – The Challenges of Growth and Need for Resilience are Top Concerns, from BornTec, which was our top story Thursday.

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Lead Stories

Beware AI euphoria; Like all great bubble stories, the latest tech narrative conveys a sense of inevitability
Rana Foroohar – Financial Times
Another week, another record high in US equity markets. Last week’s jump was triggered by the Federal Reserve’s signal that investors can look forward to more interest rate cuts this year. But deeper market bullishness is built on two things: the cash reserves of the tech giants that now dominate the markets, and belief in their ability to monetise artificial intelligence. AI will “change the world”, we are told. It will radically increase productivity (albeit by disrupting millions of jobs). It will create a huge new wealth pie for the world to share. And, according to a breathless ARK Invest report that last week predicted a $40tn boost to global gross domestic product from AI by 2030, it will “transform every sector, impact every business, and catalyze every innovation platform”.
/jlne.ws/43BzWk7

Why ESG Investing Might Never Recover; The appeal of the moniker is waning, probably because it is trying to serve too many interests at once
Jon Sindreu – The Wall Street Journal
The ESG brand probably has its best days behind it. Following a three-year craze for investment products focused on environmental, social and corporate-governance concerns, the percentage of newly created funds in the U.S. and Europe with ESG in their name has fallen from a peak of 8.3% to just 3.3%, according to an analysis of quarterly data by Morningstar Direct. Likewise, online searches for “ESG investing” have plummeted back to mid-2019 levels, according to Google Trends. Mentions of the term in company analyst calls have dropped 59% from their quarterly peak in 2022, FactSet data suggest.
/jlne.ws/3Tvn1f8

The world is warming faster than scientists expected; Fossil fuel groups and investors cannot afford to ignore the warnings
The editorial board – Financial Times
Talk about unfortunate timing. At the start of last week, the head of the world’s largest oil company, Saudi Aramco, was applauded when he told the CERAWeek energy conference in Houston it was time to “abandon the fantasy of phasing out oil and gas”. Amin Nasser said the world needed instead to invest in fossil fuels to meet demand at a time when the clean energy transition was “visibly failing on most fronts”. One day later, the head of the UN’s World Meteorological Organization, Celeste Saulo, received no applause for issuing a report that showed climate records had been not just broken but smashed in 2023, the hottest year on record. More than 90 per cent of the world’s oceans suffered heatwave conditions, glaciers lost the most ice on record and the extent of Antarctic sea ice fell to by far the lowest levels ever measured.
/jlne.ws/4coRIv7

Oil executives talk down rapid shift to green energy as profits boom; Fossil fuel companies sound emboldened at Houston gathering despite new warnings over climate change
Myles McCormick, Jamie Smyth and Amanda Chu – Financial Times
Big Oil used an industry conference this week to argue against a rapid transition to green energy, as fossil fuel companies are emboldened by high demand and record profits despite rising alarm over climate change.
/jlne.ws/3PzUIea

U.S. SEC Asking for More Millions, Dozens of Lawyers to Beef Up Crypto Oversight
Jesse Hamilton, Nikhilesh De – CoinDesk
Gary Gensler wants 33 more people in the enforcement division of the U.S. Securities and Exchange Commission (SEC) to deal with “new and emerging issues,” according to the regulator’s annual budget pitch. Much of that office’s recent, emerging workload has come from the agency’s pursuit of cryptocurrency businesses, such as Coinbase Inc., Kraken and Binance.A number of U.S. financial regulators noted the rise of crypto as a justification for their latest budget requests – an annual exercise that tends to say more about agencies’ priorities than the actual funding they necessarily end up with. The SEC, for instance, has to justify its programs to Congress – including to highly critical Republican lawmakers – in the appropriations process.
/jlne.ws/3VBMQNj

SEC’s Gensler Says Crypto Firms Skip Public Disclosures by Dodging Registration
Jesse Hamilton – CoinDesk
U.S. Securities and Exchange Commission Chairman Gary Gensler used a speech on the “public good” of securities disclosures on Friday to point specifically at the crypto industry as a problem area. Gensler, whose tenure atop the agency has been marked by a legal crusade against what he argues is a largely noncompliant industry, suggested that digital assets businesses are among those seeking to “whittle away at the SEC’s disclosure regime,” which requires companies to register securities and provide information to investors about them.
/jlne.ws/3IRWHXA

As FCMs dwindle, regulators fear systemic risk; Panellists highlight dangers of clearing membership becoming more concentrated montage
Samuel Wilkes – Risk.net
Regulators and clearing experts fear the risks from a dwindling group of large banks providing access to central counterparties, a conference in Madrid has heard. Panellists warned that clearing members, referred to as futures commissions merchants (FCMs) in the US, may not take on the portfolios of those in default, and will make it harder for less lucrative clients to find access to clearing. “When we see the [number of] FCMs being reduced, there will be a concentration risk,” said Pui Hoon Loh
/jlne.ws/3TtC8po

SEC’s Expansive Take on Insider Trading Gets First Court Test; Exec traded in rival’s stock before his company was acquired; SEC charged him with insider trading, testing novel theory
Matthew Bultman – Bloomberg
The typical example of insider trading looks something like this: An employee finds out her company is about to be acquired and buys its stock before the deal is announced. But what if the employee buys a rival company’s stock on the theory it, too, will rise? That’s the question at stake in a trial that kicks off March 25 in San Francisco, where the US Securities and Exchange Commission is accusing a former biopharmaceutical executive of illegally trading a competitor’s stock.
/jlne.ws/43u8B3i

Robinhood Co-Founder to Step Down as Creative Chief; Baiju Bhatt will remain a member of the investing platform’s board
Ben Glickman – The Wall Street Journal
Robinhood Markets co-founder Baiju Bhatt will no longer serve as an executive at the company whose app helped facilitate a meme-stock craze. Bhatt has been at or near the helm of Robinhood, an online brokerage that offers everyday investors an easy-to-use interface, since its inception in 2013. The company said on Thursday that he would step down from his role as chief creative officer to pursue other entrepreneurial interests.
/jlne.ws/3voBHoc

Raymond James Names Paul Shoukry President and CEO Successor; Raymond James Financial names Paul Shoukry President and CEO successor, announces additional key leadership changes
Raymond James Financial – via Traders Magazine
The Raymond James Financial (NYSE: RJF) Board of Directors announced today that as part of its multi-year succession planning process, effective immediately, CFO Paul Shoukry is appointed president of Raymond James Financial. It’s expected that he will become the firm’s CEO sometime during fiscal 2025, following a transition period. Once the planned succession process is complete, Shoukry would become only the fourth chief executive in the company’s history, and current Chair and CEO Paul Reilly would remain on the board as executive chair. Shoukry will retain his current responsibilities until he transitions to the CEO role.
/jlne.ws/3xdYnIc

Have the inflows into bitcoin funds dried up? Market Questions is the FT’s guide to the week ahead
Scott Chipolina and Stephanie Stacey and Kate Duguid – Financial Times
The inflows into 11 new bitcoin exchange traded funds that received US regulatory approval in January went into reverse this week. Investors will be watching daily data to see if the $850mn that leaked out of the ETFs was a blip, or a harbinger of a bigger pullback for the world’s biggest cryptocurrency. The flows had helped propel the price of the cryptocurrency to a record high of $73,000 this year. But a pullback in its price in recent days has hit investor enthusiasm for the ETFs. At one point this week, bitcoin fell as low as $60,760.
/jlne.ws/3x9eF5j

The bank argument on the Basel III endgame is bunk; What regulator could be against safer lenders at the heart of our financial system?
William Cohan – Financial Times
How much capital big banks need, or should have, is one of the most hotly debated questions on Wall Street these days. In the wake of three of the largest bank failures in US history a year ago, the US Federal Reserve, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency are all pushing to increase the capital requirements for the 100 largest banks, which fall under the Basel III regulatory regime. If they succeed in getting their way, it would be regulators’ second success on the bank capital front since the Wall Street meltdown in 2008.
/jlne.ws/3vnXmwQ

BlackRock Seeing Only ‘A Little Bit’ Demand for Ethereum from Clients, Says Head of Digital Assets
Helene Braun – CoinDesk
The asset management giant BlackRock’s (BLK) clients have “a little bit” interest in Ethereum, compared to bitcoin {{BTC}}, head of digital assets Robert Mitchnick said. “I can say that for our client base, bitcoin is overwhelmingly the number one focus and a little bit Ethereum,” he said during a fireside chat at the Friday Bitcoin Investor Day conference in New York.
/jlne.ws/3TuyI5M

The rise and fall of Sam Bankman-Fried: an unrepentant ex-mogul faces down decades in prison
Victoria Bekiempis – The Guardian
In a downtown Manhattan courtroom on the morning of 28 March, tech wunderkind turned fraudster Sam Bankman-Fried, unrepentant even after trial and conviction, will finally learn his fate. Bankman-Fried, who founded the cryptocurrency exchange FTX, was found guilty on 2 November 2023 of seven counts of wire fraud and conspiracy to launder money.
/jlne.ws/4cnBp1H

Feds Seize Luxury Jet Meant for Bankman-Fried and FTX Associates
Jonathan Randles – Bloomberg
A luxury jet that was intended to ferry FTX co-founder Sam Bankman-Fried and other executives to-and-from the Bahamas before the crypto platform went bankrupt is being turned over to US authorities. The jet, an Embraer Legacy EMB-135BJ, is being flown from the Bahamas to Florida where it will be surrendered to law enforcement, according to papers filed Friday by federal prosecutors. US Marshals have already seized a second jet that also was meant to be used by FTX. Authorities are seeking court permission to sell both aircraft.
/jlne.ws/4a784ab

SEC Urges Supreme Court to Reject Musk’s ‘Twitter Sitter’ Appeal
Greg Stohr – Bloomberg
The Securities and Exchange Commission told the US Supreme Court it should to turn away an Elon Musk appeal and leave intact his agreement to have an in-house lawyer pre-approve his social media posts about Tesla Inc. Musk, the chief executive officer of Tesla and owner of the social media company X Corp., asked the Supreme Court to intervene in December, saying the accord he signed in 2018 now violates his constitutional free speech rights. A federal appeals court rejected his contentions last year just days after the panel heard arguments in the so-called “Twitter sitter” case.
/jlne.ws/3TQ6NyD

Ken Griffin, CEO of hedge fund Citadel, says his life was shaped by a woman who died tragically
Sarah Butcher – eFinancialcareers.com
Ken Griffin, CEO of hedge fund Citadel, may be a very successful hedge fund manager with a reputation for running a tight ship, but he is also a human being who likes to chat about his friends and who’s been influenced by at least two significant women in his life. One of those women was Griffin’s grandmother, Genevieve Huebsch Gratz, who died in 2010 aged 98. Gratz, whose husband died nearly 50 years earlier, took on the running of the family oil company and the family farm (which initially had no running water) herself. When “beautifully dressed” men arrived to persuade Gratz to sell the farm shortly after her husband’s death, Gratz said she told them: “Not one of you knows an oil can from a soup can. I will keep the business. If I fail, I will solve my own problems.'”
/jlne.ws/3TxTzVw

Putin Forgot Islamic State Thinks He’s Part of the West; His response to the terror attack in Russia shows paranoia that should worry us all.
Marc Champion – Bloomberg
Three facts stand out as clear after Russia’s arrest of the alleged perpetrators of Friday’s appalling terrorist attack on Russia, and all three shine a light on dangers inherent in the new multipolar world we now inhabit. The first is that, before the attack, Vladimir Putin dismissed a US warning that it was coming, both in public and to his top security officers. He called the American intelligence that Islamists were planning an assault on a large Russian venue blackmail, aimed at destabilizing his country – a vague goal he did nothing to explain. There was a time not so long ago when Putin understood that Washington considered Islamist radicalism a shared threat, taken so seriously that it was ring-fenced from other disputes. He would have used the warning, even if he couldn’t prevent the attack.
/jlne.ws/43vPdmy

Food prices will climb everywhere as temperatures rise due to climate change – new research
Jessica Boxall and Michael Head – The Conversation
Climate change, and specifically rising temperatures, may cause food prices to increase by 3.2% per year, according to a new study by researchers in Germany. As climate change continues to worsen, this price inflation will mean more and more people around the world don’t have a varied and healthy diet, or simply don’t have enough food. The new analysis shows that global warming could cause food price inflation to increase by between 0.9 and 3.2 percentage points per year by 2035. The same warming will cause a smaller rise in overall inflation (between 0.3 and 1.2 percentage points), so a greater proportion of household income would need to be spent on buying food. This effect will be felt worldwide, by high and low-income countries alike, but nowhere more so than in the global south.
/jlne.ws/3IR2H2J

UK government ceases to be NatWest’s controlling shareholder; State’s stake in the British high street bank bailed out in the financial crisis has now fallen below 30%
Owen Walker – Financial Times
The UK government is no longer a controlling shareholder in NatWest Group after its stake in the high street lender fell below 30 per cent, the bank said on Monday morning. The latest milestone in the government’s divestment from the lender – which it was forced to bail out during the global financial crisis – comes ahead of a much hyped and controversial share sale to retail investors over the summer.
/jlne.ws/4a8Vmrg

Progress still slow in affirmation rates improving ahead of T+1 in May; DTCC encourages market participants to “ramp up their preparations and testing” and encourages continued collaboration between investment managers and their custodians.
Jonathan Watkins – The Trade
Affirmations by 9:00pm ET on trade date only increased marginally in February to 74.5%, according to data from the DTCC, which is still aiming for an overall 90% rate before T+1 comes into force in the US on 28 May. In today’s T+2 environment, approximately 90% of all trades are affirmed by 11:30am ET on T+1 – the current affirmation cut-off point, and DTCC feels a similar target rate for a T+1 environment would be appropriate to ensure settlement efficiency remains high in the market.
/jlne.ws/43xy0cs

Market Structure Reforms Challenge Broker-Dealers
Anna Lyudvig – Traders Magazine
The SEC’s amendments to Rule 605, which are the first major overhaul of publicly disclosed execution quality statistics in over 20 years, are wide-ranging and will create real challenges for broker-dealers, according to Steve Bonanno, CEO of BXS. The rule now covers brokers who introduce or carry 100,000 or more customer accounts, meaning that a significant number of firms will need to comply for the first time, he said.
/jlne.ws/3TQeXH6

Ukraine Invasion

Putin must now realise he’s been fighting the wrong war
Con Coughlin – The Telegraph
Russian President Vladimir Putin may have convinced himself that Russia’s main enemy lies in the West. But the deadly attack on a Moscow concert hall carried out by an offshoot of Islamic State of Iraq and the Levant (Isil) demonstrates that Islamist terrorists pose a far more deadly threat to his country’s well-being. The Kremlin has a long and bloody history of fighting Islamist extremism, from Russia’s brutal military campaign in Chechnya – Putin’s first war after becoming president – to Moscow’s more recent military intervention in Syria, where Russian forces were involved in eliminating Isil’s self-declared caliphate in Raqqa.
/jlne.ws/4a3kRdy

Russian missiles that Patriots have beaten before are slipping through cracks in Ukraine’s defenses
Jake Epstein – Business Insider
Russia launched a massive and deadly aerial attack against Ukraine early on Friday, firing a barrage of more than 150 missiles and drones at targets across the country. The assault included a mix of 88 cruise, ballistic, and anti-aircraft missiles, the latter repurposed for surface strike, and 63 Shahed one-way attack drones, according to the Ukrainian defense ministry, which said its forces shot down 92 of the munitions, including dozens of drones and cruise missiles.

Russia launches sweeping attack on Ukraine’s power sector, a sign of possible escalation
Hanna Arhirova and Jim Heintz – Associated Press
KYIV, Ukraine (AP) – Russia unleashed one of its most devastating attacks against Ukraine’s electric sector on Friday, an aerial assault it said was retaliation for recent strikes inside Russia and which could signal an escalation of the war just days after President Vladimir Putin cemented his grip on power in a preordained election. Many Ukrainians were plunged into darkness across several cities, at least five people were killed, and damage to the country’s largest hydroelectric plant briefly cut off power to a nuclear plant that has been a safety risk throughout the war.
/jlne.ws/3x5fiN3

Russia’s Oil Is Finally Getting Snarled by Sanctions
Rakesh Sharma, Grant Smith and Julian Lee – Bloomberg
The Russian oil-export machine funding the Kremlin’s war in Ukraine is finally getting some grit in its gears. Indian oil refiners – Moscow’s second-biggest customers after China since the 2022 invasion – will no longer accept tankers owned by state-run Sovcomflot PJSC because of the risk posed by sanctions.
/jlne.ws/3TQndXq

Russia’s recruited so many inmates to fight in Ukraine that it’s shuttering some of its prisons
Kwan Wei Kevin Tan – Business Insider
Russia has tapped on so many inmates to fuel its war effort in Ukraine that it’s closing down some prisons, a local official said on Thursday. Mark Denisov, a human rights commissioner for Russia’s Krasnodar region, told lawmakers that the decision was prompted by “a one-time large reduction in the number of convicts,” per the Russian newspaper Kommersant.
/jlne.ws/4a2y2vi

Top Russia Grain Trader Says Exports Blocked by Agricultural Watchdog
Aine Quinn – Bloomberg
A top Russian grain trader said that its wheat exports have been disrupted after the country’s agricultural watchdog faulted its cargoes for not meeting safety and quality standards. The owner of TD Rif, Petr Khodykin, said that his ships laden with Russian wheat are being blocked, causing his company “huge losses,” according to online news service Lenta.ru.
/jlne.ws/3xaNK9i

US oilfield services group SLB says it has no plans to leave Russia; Company has resisted pressure to follow its two biggest rivals in pulling out in response to Ukraine war
Jamie Smyth and Myles McCormick – Financial Times
The world’s biggest oilfield services company has no plans to exit Russia two years after the Moscow’s full-scale invasion of Ukraine, despite western pressure to curb the flow of petrodollars to the Kremlin’s war machine. Olivier Le Peuch, chief executive of SLB, told the Financial Times the company had taken no decision on whether to follow its two biggest rivals Baker Hughes and Halliburton in selling its Russia operations and is honouring its contracts with customers.
/jlne.ws/3IQlkDR

Israel/Palestine Conflict

Russia and China veto US resolution calling for immediate cease-fire in Gaza
Edith M. Lederer – Associated Press
Russia and China on Friday vetoed a U.S.-sponsored United Nations resolution supporting “an immediate and sustained cease-fire” in the Israel-Hamas war in Gaza, calling the measure ambiguous and saying it was not the direct demand to end the fighting that much of the world seeks. The vote in the Security Council became another showdown involving world powers that are locked in tense disputes elsewhere, with the United States taking criticism for not being tough enough against its ally Israel, whose ongoing military offensive has created a dire humanitarian crisis for the 2.3 million Palestinians in Gaza.
/jlne.ws/3TNEOPX

Exchanges, OTC and Clearing

Phillip Nova offers trading of Istanbul-quoted futures via Trading Technologies link
The Edge Singapore
Phillip Nova is offering trading of index futures listed on the Borsa Ä°stanbul Derivatives Exchange via its link to the Trading Technologies International, Inc. (TT) global capital markets technology platform. According to Phillip Nova, which rebranded recently from Phillip Futures, its clients can now tap on TT’s full suite of tools in charting and analytics to trade the full suite of derivatives products listed on Borsa Ä°stanbul.
/jlne.ws/3x6CRFf

DTCC Comments on Industry’s Affirmation Progress, With T+1 Implementation Two Months Away
DTCC
Today, March 25, 2024, DTCC issued the following statement: The U.S. transition to a T+1 settlement cycle is two months away, and market participants are continuing preparations as the May 28, 2024, implementation date approaches. Many firms continue to focus on enhancing operational efficiencies, including the achievement of same-day affirmation. Our analysis shows that in January 2024, 73% of transactions were affirmed by the DTC cutoff time of 9:00PM ET on trade date. In February, the number increased to 74.5%. When considering specific market segments as of the end of February 2024:
/jlne.ws/4aqlf5z

Establishment of TSE Asia Startup Hub
Japan Exchange Group
Tokyo Stock Exchange, Inc. (hereinafter referred to as “TSE”) believes that IPOs of attractive companies, both domestic and international, play a vital role for the sustainable development of the financial market, and therefore has been actively promoting IPOs to overseas companies. To further attract cross-border listings, TSE announces to establish “TSE Asia Startup Hub”, an ecosystem where TSE and IPO stakeholders collaborate to encourage promising Asian companies to choose TSE for their IPOs.
/jlne.ws/4cyJmRt

LSEG expands business development division with former Citi execution sales specialist; Individual joins after five years with Citi having previously served as an analyst at Morgan Stanley and JP Morgan.
Annabel Smith – The Trade
The London Stock Exchange Group (LSEG) has moved to expand its business development division under Richard Worrell with the appointment of a former Citi individual, The TRADE can reveal. Reesha Radia is set to join the exchange in April as a senior manager in business development and sales. She joins after most recently spending almost five years at Citi in execution sales-focused roles, most recently as assistant vice president.
/jlne.ws/3Tytplz

MIAX Exchange Group – Options Markets – Market For Underlying Security Used For Openings On MIAX Options, MIAX Pearl Options And MIAX Emerald Options For Newly Listed Symbol RDDT Effective Monday, March 25, 2024
MIAX
Reddit, Inc. (RDDT) will start trading on MIAX Options, MIAX Pearl Options and MIAX Emerald Options beginning Monday, March 25, 2024. NYSE is the “market for the underlying security” for the purpose of Openings on the Exchange.
/jlne.ws/3IRUUSd

Announcement to Accept “Japan’s Stewardship Code” for JPX’s Corporate Pension Plan
Japan Exchange Group
Japan Exchange Group, Inc. announces today its acceptance of “Japan’s Stewardship Code.” Policy for Fulfilling Stewardship Responsibilities.
/jlne.ws/3vu83xV

Special Change in KRX Media&Telecom index
Korean Exchange
There will be special constituents change in KRX Media&Telecom Index as follows. Deletion : TY Holdings(363280). Addition : None. Effective Date : March 27th, 2024
/jlne.ws/43zrMZr

Changes in Nifty Fixed Income indices
National Stock Exchange of India
The Index Maintenance Sub-Committee (Debt) of NSE Indices Limited has decided to make changes as listed hereunder. These changes shall become effective from March 28, 2024.
/jlne.ws/4awEr1P

TMX Group CEO John McKenzie to Present at the 22nd Annual National Bank Financial Services Conference
TMX Group
TMX Group CEO John McKenzie will present at the 22nd annual National Bank Financial Services Conference on Wednesday, March 27, 2024 at 1:40 – 2:05 p.m. ET. A link to the webcast will be available and archived in TMX’s shareholder events section.
/jlne.ws/3PB63Lg

Fintech

High Court orders temporary suspension of Telegram’s services in Spain
Reuters
Spain’s High Court has ordered the suspension of messaging app Telegram’s services in the country after media companies complained it was allowing users to upload their content without permission, according to a court source. The use of Telegram in Spain will be temporarily suspended from Monday after a request by media firms including Atresmedia, EGEDA, Mediaset and Telefonica.
/jlne.ws/3IRk3ww

Apple, Meta, Alphabet Probed Under New EU Law Where Fines Can Top 10% of Revenue
Jack Denton – Barron’s
Apple, Meta Platforms, and Alphabet are being scrutinized by the European Union under a new law that can see anticompetitive behavior met with fines of 10% of global revenue. It’s the latest salvo against Big Tech as global regulatory pressures build.
/jlne.ws/4coPj3D

Delinquencies Topping 60% Spell Trouble for Brazil’s Fintechs; Open Co hit by losses on riskiest securitized loan tranche; Defaults rise to 9.5% in credit market used widely by fintechs
Giovanna Bellotti Azevedo and Cristiane Lucchesi – Bloomberg
Brazilian fintechs are getting hit by a wave of defaults on loans they made to customers that the nation’s bigger, legacy banks wouldn’t touch, causing risky layers of an asset-backed credit market to collapse. The companies, which include Goldman Sachs-backed Open Co, Nexoos and Gyra+, are seeing delinquencies on some of their portfolios for unsecured loans top 60%, forcing them to merge, pull back on expansion plans and sell assets to survive.
/jlne.ws/43z9ojJ

Digital transformation drives gains for IT and software groups; Financial services among biggest spenders as higher rates lead to bigger margins and surplus cash for tech
Nick Huber – Financial Times
As companies tackle digital overhauls of their businesses – from homeworking to customer relationship management – they are inc­reasingly relying on external providers for information technology services and advice. European companies and public sector organisations are set to spend $1.1tn on IT this year, up 9 per cent from 2023, according to research company Gartner. And it expects the biggest increase to be in spending on software and IT services. This uplift comes as the technology industry has been battling a global downturn. Venture capital investment in European tech companies almost halved, year on year, in 2023, but some analysts are now detecting the recovery.
/jlne.ws/3ISAQ2f

Charles River appointed to manage front-office operations for Perpetual; Charles River will manage Perpetual’s Australian asset management’s domestic and global portfolios, order and execution, compliance, post-trade processing and front-office data.
Claudia Preece – The Trade
State Street’s Charles River is set to manage the front-office operations for Perpetual Group’s Australian asset management business. Dennis Baillon, director of business development for APAC at Charles River, asserted: “To be successful in today’s market, managers need a platform that provides flexibility in their operating environment and enables them to scale as their business requires.”
/jlne.ws/3IQp8oD

Equinix commences investigation into short-seller Hindenburg’s report
Reuters
/jlne.ws/4cJlnzp

Microsoft Deal, Apple-Google Talks Show Tech Giants Need AI Help
Dina Bass and Jackie Davalos – Bloomberg
/jlne.ws/3VwUrMR

AI Will Mean Cheaper Food; It will allow farmers and distributors to make dramatic improvements in efficiency, putting downward pressure on prices.
Sultan Meghji – The Wall Street Journal
/jlne.ws/4cr0gkZ

Anthropic weighs slate of sovereign wealth funds to acquire FTX’s $1 billion stake, CNBC reports
Reuters
/jlne.ws/4crXuMu

Bankers Are Lining Up Buyers for FTX’s 8% Stake in AI Startup Anthropic: Report
Cheyenne Ligon – CoinDesk
/jlne.ws/43t3y3b

AI Accounting Startup FundGuard Raises $100 Million in New Funds; Hamilton Lane, State Street join round led by Key1 Capital; Company has raised $150 million so far; valuation undisclosed
Marissa Newman – Bloomberg
/jlne.ws/4as9Z8Z

Stability AI’s Emad Mostaque is out following an investor mutiny and staff exodus that left the one-time tech darling in turmoil
Rachelk Metz and Mark Bergen – Fortune
/jlne.ws/3PzXMae

***** Ironic headline of the day. ~SR

Cybersecurity

Russian Hackers Tried Duping German Politicians Before Elections
Ryan Gallagher – Bloomberg
Russian spies waged a hacking campaign targeting German political parties by attempting to trick them with fake dinner invitations, according to new research from Mandiant. The hackers, known as APT29 and linked by Mandiant to Russia’s SVR foreign intelligence service, have previously been known to target diplomatic entities, but have pivoted for the first time to focus on political parties, a Mandiant report warned. The shift indicates “a broad threat to European and other Western political parties” from across the political spectrum, the report said.
/jlne.ws/3TQ704T

U.K. to Blame China for Hacking Details of Millions of Voters; The British government is the latest in the West to warn about China’s increasingly aggressive cyber campaign
Max Colchester – The Trade
The U.K. government is set to publicly accuse the Chinese state of hacking Britain’s electoral register, containing the personal details of millions of voters, the latest move by a Western government to pressure Beijing by publicly calling out its cyberactivities. The U.K.’s Electoral Commission said last year that hackers had accessed the nation’s voter registration records-which included the names and addresses of around 40 million people-as well as the commission’s email system and information about political donors. The hackers accessed the system in 2021 but were only detected in late 2022, the commission said.
/jlne.ws/43wu0Ja

The 10 best (and worst) countries for cybersecurity
BBC Science Focus
A 2023 Harvard Business study has revealed that data breaches in the US are at an “all time high”, increasing by 20 per cent in the first three quarters of 2023 compared to 2022. The picture was similar around the globe where attacks were particularly focused on the UK, Australia and Canada. In the Middle East ransomware gang activity grew by 77 per cent during the same year. This small glimpse into the ever shifting landscape of global cybersecurity hints at the level of threat faced by global nations.
/jlne.ws/3VrZDlf

Russian hackers target German opposition with fake dinner party; Attempted attack was uncovered by US cyber security company Mandiant, owned by Google
Sam Jones – Financial Times
Hackers linked to Russia’s foreign intelligence service have targeted German opposition politicians with malware-laced invites to a bogus dinner party. The attempt to penetrate sensitive computer systems run by Germany’s Christian Democratic Union – the party of former chancellor Angela Merkel – occurred last month, but was revealed on Friday by party officials and cyber security analysts who warned of more Russian efforts to compromise political parties across Europe.
/jlne.ws/43ECIoY

Cryptocurrencies

Harvard Dropouts With Plan to Disrupt Nvidia Nab Peter Thiel Funding; Here’s what three winners of the billionaire’s fellowship, which controversially requires students to drop out of school, hope to get out of the experience.
Francesca Maglione – Bloomberg
Three ditched Harvard University to design specialized AI chips. Another two left New York University to develop a better crypto exchange and a photo sharing app. These are a few of the latest recruits for Peter Thiel’s fellowship program, which grants entrepreneurs age 22 and younger $100,000, under the condition they drop out of school, if they haven’t already. This year the fellowship received its largest ever pool of applicants. Bloomberg News spoke to three of the 20 incoming class of 2024 fellows about why they decided to quit college, apply to the fellowship and what they hope to get out of the two-year program.
/jlne.ws/3Tp2OY4

Bitcoin ‘Halving’ Spurs Exodus of Old US Mining Computers Abroad
David Pan – Bloomberg
About 6,000 older Bitcoin mining machines in the US will soon be idled and sent to a warehouse in Colorado Springs where they’ll be refreshed and resold to buyers overseas looking to profit from mining in lower-cost environs. Wholesaler SunnySide Digital operates the 35,000 square-foot facility taking in the equipment from a mining client. The outdated machines are among several hundred-thousand it expects to receive and refurbish around a major quadrennial update in the Bitcoin blockchain.
/jlne.ws/3voT0W7

Cathie Wood Calls Bitcoin a ‘Financial Super Highway,’ Reiterates $1.5M Price Target
Helene Braun – CoinDesk
Ark Invest CEO Cathie Wood called bitcoin {{BTC}} a “financial super highway,” emphasizing the important use cases for the cryptocurrency in emerging markets. Wood, whose Ark Invest recently became one of the issuers of a spot bitcoin exchange-traded fund (ETF), ARKB, said the asset manager is focused on emerging markets and the macro environment worldwide, which has been “shocked” by the U.S. Federal Reserve’s increase in interest rates, she said during a fireside chat at the Friday Bitcoin Investor Day conference in New York.
/jlne.ws/3Tx72Nn

Accused crypto laundering mastermind dreamt of being a Buddhist goddess; Zhimin Qian’s spectre loomed over the trial of her ‘carer and assistant’ Jian Wen for money laundering
Eri Sugiura, Eleanor Olcott and Wenjie Ding – Financial Times
Zhimin Qian dreamt that the Dalai Lama would anoint her a reincarnated goddess and that she go on to become the Queen of Liberland, an unrecognised micronation on the Danube, where she would build the biggest Buddhist temple in Europe. A fugitive from the Beijing authorities, Qian had the funds to believe such mad dreams could become reality: huge sums of bitcoin from a £5bn investment scam she allegedly ran in China, defrauding more than 128,000 people.
/jlne.ws/4aqhzkh

Politics

NY AG Letitia James seizing Trump’s 40 Wall Street would be a huge loss for the city – and our democracy
Steve Cuozzo – NY Post
If state Attorney General Letitia James seizes Donald Trump’s 40 Wall Street – his largest real estate asset by far – the worse damage would be to New York City. The troubled but functional landmark office building would become an empty white elephant in Lower Manhattan, which is already reeling from a hemorrhage of tenants to uptown.
/jlne.ws/4aqILiT

Once-lukewarm billionaires set to come back around to Trump at fundraiser hosted by John Paulson
Lydia Moynihan
Attendees at an April fundraiser for Donald Trump will shell out as much as $814,600 to join a guest list that includes sports team owners Woody Johnson and Todd Ricketts and casino mogul Steve Wynn, The Post has learned. Also on the list: hedge fund billionaire Robert Mercer and his daughter Rebekah Mercer, who helped bankroll the former president’s 2016 election but mostly sat out the 2020 campaign.
/jlne.ws/3x5BtTB

There Is a Twisted Logic to Trump’s Obsession With Al Capone
Samuel Earle – The New York Times
In recent months, Donald Trump has been trying out a new routine. At rallies and town halls across the country, he compares himself to Al Capone. “He was seriously tough, right?” Mr. Trump told a rally in Iowa in October, in an early rendition of the act. But “he was only indicted one time; I’ve been indicted four times.” (Capone was, in fact, indicted at least six times.) The implication is not just that Mr. Trump is being unfairly persecuted but also that he is four times as tough as Capone. “If you looked at him in the wrong way,” Mr. Trump explained, “he blew your brains out.”
/jlne.ws/3vy4Flt

US places bets on European companies in $6bn effort to clean up its heavy industry; Biden administration push to decarbonise draws in companies from Sweden, Denmark and Germany
Lee Harris – Financial Times
Swedish steelmaker SSAB is among the European winners of a series of US government investments in an $6bn effort to decarbonise manufacturing, across high polluting sectors such as steel, cement, chemicals and fuel refining. The $500mn in funding earmarked for an SSAB commercial-scale steel plant using hydrogen in Mississippi is one of 33 deals by a new agency set up under the Department of Energy, as part of the Biden administration’s efforts to steer industrial strategy and stimulate the manufacturing sector.
/jlne.ws/43zrbXU

China blocks use of Intel and AMD chips in government computers; Microsoft’s Windows and foreign database programs also sidelined as Beijing favours Chinese hardware and software
Ryan McMorrow and Nian Liu in Beijing and Qianer Liu – The Wall Street Journal
China has introduced new guidelines that will mean US microprocessors from Intel and AMD are phased out of government PCs and servers, as Beijing ramps up a campaign to replace foreign technology with homegrown solutions. The stricter government procurement guidance also seeks to sideline Microsoft’s Windows operating system and foreign-made database software in favour of domestic options. It runs alongside a parallel localisation drive under way in state-owned enterprises.
/jlne.ws/3TREX54

China and Russia challenge US claim to mineral-rich stretches of seabed; Critics say Biden administration risks losing race to mine resources in international waters
Kenza Bryan and Josh Gabert-Doyon and Demetri Sevastopulo – Financial Times
/jlne.ws/3PzUiEC

Regulation

Trial for Fallen Crypto Tycoon Do Kwon Begins, But He Won’t Be There; SEC to open civil case against the creator of TerraUSD and Luna on Monday
Dave Michaels – The Wall Street Journal
Fallen crypto tycoon Do Kwon faces trial Monday on claims that he defrauded people who bought a cryptocurrency that collapsed two years ago, setting off a chain reaction that led to trading-firm failures and losses for investors around the world. The Securities and Exchange Commission will open its civil case in Manhattan federal court against Kwon and his company, Terraform Labs, even though Kwon won’t be there.
/jlne.ws/43zYPwQ

Do Kwon – the crypto fugitive U.S. prosecutors want to try for $40B collapse of TerraUSD – released from Montenegro prison
Jasmina Kuzmanovic, Misha Savic and Bloomberg – Fortune
South Korean crypto fugitive Do Kwon was released from prison in Montenegro early Saturday as the Supreme Court deliberates on extradition requests from US and South Korea. “We released Do Kwon from prison as his regular prison term for traveling with fake papers ended,” prison director Darko Vukcevic said by phone. “Since he is a foreign citizen and his documents were withheld, he was taken for an interview to police directorate for foreigners, and they will deal with him further.”
/jlne.ws/3Vy8W35

Nigeria Announces Charges Against Binance as Executive Flees; Nadeem Anjarwalla escaped on Friday during prayers at a mosque; Two Binance execs had been charged to court for tax evasion
Nduka Orjinmo – Bloomberg
Nigeria filed charges of tax evasion against Binance and two executives of the cryptocurrency platform it has detained, as the government said that one of the men has fled the country. The Federal Inland Revenue Service accused Binance of non-payment of value-added-tax and company income tax, failure to file tax returns and complicity in aiding customers to evade taxes through its platform, it said in an emailed statement Monday.
/jlne.ws/4cyCzHt

Chair of LCF borrower reaches settlement in ‘Ponzi scheme’ lawsuit; Hume-Kendall had been accused by administrators to failed investment firm of using investors’ savings to fund lifestyle
Alistair Gray – Financial Times
A couple accused of receiving about £24mn from London Capital & Finance and using it to fund a lavish lifestyle – including luxury travel, jewellery and membership of a Mayfair member’s club – have reached a settlement with administrators of the failed UK investment firm. Simon and Helen Hume-Kendall had been accused in High Court proceedings of benefiting from a “Ponzi scheme” that extracted funds from 11,600 investors in one of the country’s biggest retail savings scandals of recent years.
/jlne.ws/3x69LWF

A woman lost $789K in a gold bar scam, police say. Then she turned the tables; Police say an undercover detective posed as a fraud victim in her 60s to catch the alleged scammer
Dan Morse – The Washington Post
Lisa Bromley has done a lot during her 30 years as a police officer in suburban Maryland. Undercover drug buys. Armed robbery investigations. Working car crashes. But it wasn’t until last week that she found herself disguised in a wig and a coronavirus mask, playing the role of a scam victim in her 60s who police say had already been bilked out of about $789,000 worth of gold bars. Her hope: Their target would soon pull into a parking lot in Montgomery County’s sprawling Leisure World community looking for more gold.
/jlne.ws/49bKZSv

Chairman Behnam Announces CFTC Agricultural Advisory Committee to Meet April 11 in Overland Park, KS
CFTC
Chairman Rostin Behnam, sponsor of the Agricultural Advisory Committee (AAC), today announced the AAC will hold a public meeting on April 11 from 9:30 a.m. to 11:00 a.m. (CDT) at the Sheraton Overland Park Hotel in Overland Park, KS. Members of the public will also have the option to attend virtually.
/jlne.ws/491SBH2

“I’m with Roosevelt and Jack: Benefits of Mandatory Disclosure” Prepared Remarks before Columbia Law School Conference in Honor of John C. Coffee, Jr.
Chair Gary Gensler – SEC
We’ve all taken tough positions: Beatles vs. Stones; Yankees vs. Mets; Coke vs. Pepsi. Jack was focused on mandatory vs. voluntary disclosure. He was on the side of the founding principles of the federal securities laws. The basic bargain that President Franklin Roosevelt and Congress laid out 90 years ago was that investors get to decide which risks to take so long as those companies raising money from the public make what Roosevelt called, “complete and truthful disclosure.” In 1933, the year the Securities Act was enacted, Roosevelt said, “It changes the ancient doctrine of caveat emptor to ‘let the seller beware,’ and puts the burden on the seller rather than on the buyer.”[2] Jack had three main points in that seminal 1984 paper about the benefits of mandatory disclosure, the first of which may have been the most important.
/jlne.ws/3VEjNs6

SEC Charges Former Chairman and CEO of Lordstown Motors Corp. for Misleading Investors
SEC
The Securities and Exchange Commission announced settled fraud charges against Stephen Scott Burns, former Chairman and CEO of bankrupt automaker Lordstown Motors Corp., for misleading investors about “pre-orders” for Lordstown’s flagship electric pickup truck called Endurance.
/jlne.ws/3vpf7vK

SEC Obtains Final Judgment Against Advisor Resource Council for Compliance Failures
SEC
On February 16, 2024, the Securities and Exchange Commission obtained a final judgment against Advisor Resource Council, a registered investment adviser the SEC previously charged with making false and misleading statements in its ADV brochures and failing to adopt policies and procedures to ensure fair and equitable trade allocations among Advisor Resource Council’s advisory clients.
/jlne.ws/497n2eR

Banned Trader Kept Working for Years Before Regulator Caught Him
Layan Odeh – Bloomberg
Mark Valentine, a former financial industry executive whose aggressive trading earned him a ban from Canadian regulators nearly 20 years ago, never really quit. Ontario’s Capital Markets Tribunal has found that Valentine – barred for life in 2004 from holding senior roles at corporate issuers in the Canadian province – flouted that prohibition repeatedly, taking on director or officer positions at dozens of small companies. Valentine also didn’t abide by a 15-year trading ban, the tribunal found in a written decision this week. Valentine participated in stock-lending deals that qualified as trades and was involved in the sale of millions of shares of Flyp Technologies Inc., it said.
/jlne.ws/3TyZcCT

Investing and Trading

The $27 Trillion Treasury Market Is Only Getting Bigger; More debt, different buyers and increased regulation pose challenges
Eric Wallerstein – The Wall Street Journal
The world’s largest, most-important financial market is growing by leaps and bounds. On Wall Street, that is making people nervous. Annual issuance of U.S. Treasurys has exploded, nearly doubling since the pandemic began. The government sold a record $23 trillion worth in 2023. And few think the spree is going to slow soon, given the widespread expectation that government spending will continue to rise regardless of who wins November’s elections.
/jlne.ws/3VxFIBf

The Wacky Negative Interest-Rate Experiment Ends With a Thud; A supposed central-bank innovation never gained traction economically but went on for more than a decade anyway. What was gained?
Spencer Jakab – The Wall Street Journal
The most generous thing you can say about pushing interest rates below zero is that it was an idea ahead of its time. The experiment that turned the world of finance upside down ended this past week in Japan without having accomplished much of anything. At times it felt like 12 years in a strange new world-sort of like going south of the South Pole. Outside of the central banks that pushed the idea as a solution to stagnant growth, few people were persuaded. Wall Street still doesn’t like it. Ordinary people certainly never got comfortable with the idea of being paid to borrow and charged to save money.
/jlne.ws/3IPan5s

The Short-Vol Trade Is Back: Why Some Investors Think It’s Driving Tranquility in Markets; Investors are pouring money into derivative-income funds that sell options contracts to juice income
Charley Grant – The Wall Street Journal
The stock market is calmer than it has been in years. Some worry that a popular strategy is contributing to the tranquility. Measures of market volatility have fallen to levels last seen in 2018, while major stock indexes have climbed to repeated all-time highs. The S&P 500 is up 9.7% in 2024 and has set 20 closing records.
/jlne.ws/3PD4zjr

Blowout Reddit debut raises hopes of revival in dormant IPO market; Other companies could be emboldened by the social media group’s successful listing, say bankers
Jennifer Hughes – Financial Times
A string of companies could follow Reddit into the US stock market in the coming months, bankers believe, after shares of the social media group leapt 48 per cent on their debut. A steady, sustained rise in activity would breathe life into the market for initial public offerings, which has been largely shut down since 2021.
/jlne.ws/3xh2Xp6

UK’s ‘staggeringly cheap’ stocks trade at record discount to US; After years of underperformance, some investors eye bargains on London market
Stephanie Stacey and Costas Mourselas – Financial Times
UK stocks are trading close to a record discount relative to their Wall Street counterparts, luring some bargain-hunting investors back to the country’s battered stock market. London-listed equities have lagged behind peers in recent years as heavyweight sectors like banking and energy have failed to keep pace with the rapid growth of technology stocks, and political uncertainty following the 2016 vote to leave the EU weighed on the market.
/jlne.ws/3IWJNr6

US investment funds pull $13.3bn from BlackRock in anti-ESG campaign; Latest loss of $8.5bn in Texas comes after asset manager tried to make inroads in the Republican state
Will Schmitt – Financial Times
/jlne.ws/3INrPaN

Environmental, Social and Corporate Governance

Investment Risks from Climate
Aynsley O’Neill and Jenni Doering – NPR Living on Earth
Climate disasters, adaptation costs and market shifts threaten the value of public companies that are inadequately prepared for climate change. So the Democratic majority US Securities and Exchange Commission recently approved a rule that will require public companies to inform investors about their greenhouse gas emissions and climate risks. Emeritus Professor Pat Parenteau of Vermont Law and Graduate School joins Living on Earth’s Steve Curwood to explain the rule and the pushback from industry and several Republican-led states.
/jlne.ws/3xbyBVd

Invesco’s $2.1 Billion Fund Offers Way to Invest in Water Risks; The fund is one of 11 US offerings that are drawing investors to a world where clean water is becoming scarcer.
Lily Meier – Bloomberg
That’s the opinion of analysts at Morningstar Inc. In a report marking World Water Day, analyst Mahi Roy spotlighted five US-based funds, as well as some companies, that focus on expanding access to water, improving water quality and providing solutions that address other water challenges. The $2.1 billion Invesco Water Resources exchange-traded fund (ticker: PHO) is by far the industry’s largest fund. Other offerings that make Morningstar’s list of highest-rated funds are Calvert Global Water (CFWAX), Invesco S&P Global Water ETF (CGW), Virtus Duff & Phelps Water (AWTPX) and Ecofin Global Water (EBLU).
/jlne.ws/3TtE0yd

World’s First Global CO2 Charge Inches Closer at London Meetings; Sector spews more than a billion tons of CO2 each year; Regulator wants to put emissions levy into force in 2027
Jack Wittels – Bloomberg
The shipping industry is being lined up as a guinea pig for a world-first: a global, mandatory charge on greenhouse gas emissions. The International Maritime Organization – which regulates shipping worldwide – inched closer toward such a levy at talks held in London this week. The United Nations agency plans to finalize the detail of the measure next year, and have it introduced in 2027. While the timeline is clear, there’s far less certainty about how it will actually work and whether there will be a significant impact on the emissions of an industry that carries 80% of world trade and spews more than a billion tons of carbon dioxide into the atmosphere each year.
/jlne.ws/3x8cAGV

Coal, the Dirtiest Fossil Fuel, Is Preparing for a Long Goodbye; Declining in the developed world, not in China or India; Supplies roughly a third of global electricity generation
Bloomberg News
More than two years after climate negotiators first attempted to consign coal to history, the dirtiest fossil fuel is having a moment. Thanks to a combination of China’s energy insecurity – pushing Beijing back to trusted power sources – plus rising Indian demand, the continued fallout from the war in Ukraine and faltering international programs to wean developing economies off fossil fuels, coal is proving remarkably resilient. Output hit a record last year, and producers are preparing for a future where they will be required for decades yet to balance renewable energy.
/jlne.ws/3VrVlu9

China and Russia challenge US claim to mineral-rich stretches of seabed; Critics say Biden administration risks losing race to mine resources in international waters
Kenza Bryan, Josh Gabert-Doyon and Demetri Sevastopulo – Financial Times
US claims to a swath of mineral-rich seabed are being challenged by China and Russia because Washington has failed to ratify a treaty that governs access to resources in international waters. Chinese and Russian diplomats said last week that a US claim to an extended area of seabed was unacceptable given its position on the 1982 United Nations Convention on the Law of the Sea (Unclos), according to three people who attended a meeting in Kingston, Jamaica of the International Seabed Authority, which was established under the treaty.
/jlne.ws/3PzUiEC

EU countries split over nature law in latest blow to green agenda
Kate Abnett – Reuters
/jlne.ws/4991zSS

Germany’s Solar Panel Industry, Once a Leader, Is Getting Squeezed; Domestic manufacturers are caught between China’s low prices and U.S. protectionist policies, even as demand increases.
Melissa Eddy – The New York Times
/jlne.ws/3vq2IHQ

America’s lithium laws fail to keep pace with rapid development
Ernest Scheyder – Reuters
/jlne.ws/3VqVUV4

Study: Demand for steel from offshore wind industry could outstrip dwindling UK production
Michael Holder – BusinessGreen
/jlne.ws/4cwK3eg

Real Estate Investors Turn to Lawyers After ‘Huge’ CO2 Shock; Some investors may be unable to afford the renovations needed; Greener buildings, meanwhile, are fast gaining in value
Frances Schwartzkopff and Gautam Naik – Bloomberg
/jlne.ws/4cx62lm

Oil executives talk down rapid shift to green energy as profits boom; Fossil fuel companies sound emboldened at Houston gathering despite new warnings over climate change
Myles McCormick, Jamie Smyth and Amanda Chu – Financial Times
/jlne.ws/3PzUIea

Climate graphic of the week: World’s worst hotspot for oil pollution by ships; Satellite detection shows Indonesia suffers the most slicks tracked in busy waterways
Alexandra Heal and Jana Tauschinski – Financial Times
/jlne.ws/3VqUMAO

Profits Not Prices Drive Renewable Development, New Book Says; Renewable energy’s long-term profitability needs government support, argues author Brett Christophers.
Aaron Clark – Bloomberg
/jlne.ws/3PD7l8l

Institutions

Morgan Stanley’s ETFs Break $1 Billion With Mutual Fund Flips; Firm is converting two active Eaton Vance bond funds into ETFs; Morgan Stanley now manages 14 ETFs after last year’s debut
Katie Greifeld – Bloomberg
Morgan Stanley’s exchange-traded lineup now holds more than $1 billion thanks to the firm’s first-ever mutual-fund conversions. The issuer is flipping two fixed-income mutual funds from Eaton Vance – one that follows a total return bond strategy and one focused on short-duration municipal debt – into ETFs, the company said in a statement Monday. That brings Morgan Stanley’s total ETF lineup to 14 funds.
/jlne.ws/3VPVPdV

Henry Maxey versus the ‘massive moral hazard machine’; And other financial market monsters
Robin Wigglesworth – Financial Times
Two years ago Ruffer’s investment chief Henry Maxey promised us a full-blown liquidity crisis as the Fed tightened monetary policy. All we got were a few gormless US banks embarrassing themselves. In the UK asset manager’s latest annual review (out last week but we only got around to reading it) co-CIO Maxey revisited his 2022 prediction, and mused on whether the danger has “been averted, or merely postponed”. You can probably guess the conclusion:
/jlne.ws/43vQV7s

Famously Obstinate, Bill Ackman Is Now Real-Life Famous. What Next?; The hedge-funder who loves a public crusade – and taking charge – is on to a new stage of his career: online warrior.
Maureen Farrell – The New York Times
In June 2017 – as he was reeling from the end of his marriage of more than two decades and some of the most disastrous investments of his career – Bill Ackman, the billionaire hedge-fund financier, joined Twitter. In his few posts that year and the next, Mr. Ackman, now 57, shared a picture of himself posing in line at the fast-food chain Chipotle, one of his largest investments; links to position papers on another investment, ADP; and a news release announcing the winners of his foundation’s awards. He offered his early Twitter followers little of the drama that was part of his investing style and would later become a hallmark of his round-the-clock social media posts.
/jlne.ws/4cuG4i6

Work & Management

The perils of speaking up at work too often deter staff from voicing concerns; Boeing is one employer where workers are still hesitant to come forward with problems
Michael Skapinker – Financial Times
Staff at Boeing are still reluctant to speak up about safety problems, even after a door panel on one of its jets recently blew out mid-flight and hundreds of lives were lost in two earlier planes crashes, according to an experts’ report commissioned by the US Federal Aviation Administration. The report, published last month, did not comment on these particular incidents. But it said that, while Boeing had taken steps to improve its safety culture, staff were still hesitant about voicing concerns because they feared retaliation. It noted that the jet maker’s “speak up” programme, which allows employees to report safety problems confidentially, suffers from workers not believing their anonymity will be protected.
/jlne.ws/49a9pLV

5 Work Boundaries Employees Often Have – That Many Bosses Don’t Like; “Even if the people around you don’t like your boundaries, that doesn’t invalidate them.”
Megan Quinn – Your Tango
While working for any company, it is always important to lay down some boundaries so they are aware of what they can expect from you as an employee. Whitney Living, an at-home career strategist, shared a list of her work boundaries in an Instagram post, and her bosses in the past were not particularly fond of them. “The work boundaries you need to be happy, fulfilled, and feel protected, are unique to you. Your boundaries don’t have to look like anyone else’s,” she wrote. Here are 5 work boundaries employees often have that many bosses don’t like: 1. ‘I don’t work weekends’ Weekends are a time to unwind and spend with loved ones, especially if you work eight hours for the other five days of the week.
/jlne.ws/3TyvQEJ

Beware the rise of the everything adviser; Offering complementary services can boost firms’ profits but can also erode client trust
Anjli Raval – Financial Times
Whatever the problem, it can be managed if not resolved. That is the pitch of businesses that increasingly tout themselves as one-stop shops for advice to major corporations. Welcome to the world of the everything adviser. These consultancies, some of which started in public relations, have seen their remit balloon over the past decade as reputation risk became just as big a boardroom priority as financial risk. For firms such as Brunswick, FGS Global and FTI Consulting, work consists of everything from crisis and financial communications to advising on sustainable business, corporate culture reviews and geopolitical risk analysis. Teneo is also involved in executive succession and has a restructuring business.
/jlne.ws/3IR7Ckd

They Chose to Take a Pay Cut-and Say They’re Happier; Switching to a job with a lower salary often means trimming your expenses, but it can come with a raise in free time and work-life balance
Joe Pinsker – The Wall Street Journal
When Daisy Almaguer took a $50,000 pay cut, she celebrated with martinis. The 33-year-old left a job in tech making $150,000 a year because she was burned out from working 12-hour days. Switching to a job that was less intense at a different tech company last year freed her up to do more cooking, exercising and relaxing with her fiancé and their dog.
/jlne.ws/3hLgOJD

Wellness Exchange

The Brutality of Sugar: Debt, Child Marriage and Hysterectomies
Megha Rajagopalan and Qadri Inzamam – The New York Times
Archana Ashok Chaure has given her life to sugar. She was married off to a sugar cane laborer in western India at about 14 – “too young,” she says, “to have any idea what marriage was.” Debt to her employer keeps her in the fields. Last winter, she did what thousands of women here are pressured to do when faced with painful periods or routine ailments: She got a hysterectomy, and got back to work. This keeps sugar flowing to companies like Coke and Pepsi. The two soft-drink makers have helped turn the state of Maharashtra into a sugar-producing powerhouse. But a New York Times and Fuller Project investigation has found that these brands have also profited from a brutal system of labor that exploits children and leads to the unnecessary sterilization of working-age women.
/jlne.ws/4cwkytj

Covid still warps our sense of time; Four years after lockdowns began we are still learning about pandemic hangovers
Pilita Clark – Financial Times
The other day I had a disturbing conversation with my doctor. I had gone to see him about a minor ailment when he suddenly started asking me about some sort of herbal pill. “What?” I said blankly. You know, he said, the ones I told you to buy from the health food store that you told me worked well. “I did?” I said, certain the poor man had mixed me up with a patient who believed in homeopathic guff. “You did,” he said, swivelling around to his computer screen to read out a gushing email I had sent to thank him for recommending a herbal tablet I had called a “blessedly welcome” success.
/jlne.ws/4a7djXo

Regions

Iceland to harvest more corn and less bitcoin, says PM; Katrín Jakobsdóttir tells the FT the island nation needs food security in a hostile world
Andy Bounds and Alice Hancock – Financial Times
Iceland plans to prioritise food security over financial gain, planting corn and curbing bitcoin miners as the island state strives for more self-sufficiency in a hostile world. Prime Minister Katrín Jakobsdóttir told the Financial Times that recent protests by farmers in Europe and disruptions to trade meant the Nordic nation needed to reduce its reliance on imports.
/jlne.ws/3Pz9p0Z

Britain agrees $100 mln trade finance to boost Africa food security
Simon Jessop – Reuters
Development lender British International Investment said on Monday it had agreed a $100 million finance facility with the Eastern and Southern African Trade and Development Bank (TDB) to boost trade finance, farming and food security in the region. The finance will help fund trade, including importing and exporting goods, on a continent where many debt burdened African economies face currency depreciation and rising debt and inflation compounded by issues such as climate change.
/jlne.ws/3TPs5vZ

India’s quid pro quo trade strategy; If companies or countries want freer access to India’s market, they must offer concessions
Financial Times Podcast
US and Japan’s security alliance gets a makeover, a record amount of money has flooded into US corporate bond markets this year, and India is using a ‘quid pro quo’ strategy for trade talks.
/jlne.ws/3TvDNKY

Ghana’s Low Cocoa Crop Hammers Trade Surplus in First Two Months; African nation’s currency has fallen 8% so far this year; Adverse weather and disease have driven down cocoa output
Moses Mozart Dzawu – Bloomberg
Ghana’s smaller cocoa harvest has hit the country’s external payments position as its trade surplus fell by more than half in the first two months, posing a risk to the cedi currency. The West African nation’s trade surplus narrowed by 54% from a year earlier to $392.8 million for Jan-Feb, the Bank of Ghana said in a summary of economic and financial data posted on Friday. Revenue from cocoa exports fell by almost a third to $508.4 million, the central bank said.
/jlne.ws/3TzHLm1

Securities Commission Malaysia Issues Cease And Desist Directive Against Quantum Metal Exchange Inc For Offering Shares To Public
Mondovisione
The Securities Commission Malaysia (SC) today has directed Dato’ Lim Khong Soon @ Lim Hock Seng, the Founder and Director of Quantum Metal Exchange Inc (QMEI), to immediately cease and desist the offering of QMEI shares to the Malaysian public. The QMEI share offering, which is currently ongoing, contravenes the relevant requirements under securities laws.
/jlne.ws/3VyfsGV

Miscellaneous

The State Had at Least $52,000 of Her Money. Why Couldn’t She Get It Back?; A financial firm told an account owner that it had turned over her money to the state. When she filed a claim, something strange happened.
Ron Lieber – The New York Times
Early in 2022, Sarah F. Cox got wind that someone named Connie was looking for her. The stranger wanted to reunite Ms. Cox with some lost money under her name that the State of New York was holding. It sounded like a scam, so she didn’t bother following up immediately. But months later, Ms. Cox called Connie back when she was visiting the United States while moving from China to Singapore, where she lives now. It turned out that Connie was a kind of bounty hunter, helping people and businesses navigate states’ unclaimed property databases.
/jlne.ws/4cz1UkP

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