Biden’s Wall Street Watchdogs Signal New Era of Tough Oversight; Euronext shuffles Paris business leadership ahead of Borsa Italiana takeover

Jan 18, 2021

First Read

$25,451/$300,000 (8.5%)

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Hits & Takes
JLN Staff

The markets press is in a bit of a Gary Gensler fever moment with stories in the WSJ, Bloomberg and Financial Times about how this fearsome Wall Street cop is going to start to walk the beat again. He has a billy club and is not afraid to use it.

There are actually bigger things to worry about right now than Gary Gensler at the SEC.

The New York Times reports that “about 3,300 people are dying from the coronavirus every day in the United States. The country is fast approaching 400,000 total deaths and New York City is averaging more than 6,000 new cases a day. On a per capita basis, the situation on Long Island is even worse.”

“As of Monday morning, more than 23,983,600 people in the United States have been infected with the coronavirus according to a New York Times database.”

Also, there is some concern about risk to President-Elect Biden from inside the 25,000 National Guard troops expected to be present for the inauguration, the Associated Press reports. The FBi is vetting the National Guard troops.

This week we have sponsored content in JLN from JPX Group. Sponsored content is a week long advertisement in the top box of the newsletter. Contact me if you are interested in using this resource to advertise, or you are a sponsor already and you want to schedule your sponsored content in our editorial calendar.

If you are looking for a good Martin Luther King, Jr. Day movie, I would recommend you check out “One Night in Miami” on Amazon Prime. It tells the fictional story of an evening with Cassius Clay (who becomes Muhammed Ali), musician Sam Cooke, football great Jim Brown and Nation of Islam leader Malcom X. The evening was after Clay defeated Sonny Liston to win the heavy-weight boxing championship. Here is a trailer for the movie.

We had no new donations to the JLN MarketsWiki Education GoFundMe campaign. To date, we have had 112 donations. Support our efforts to preserve industry history by donating to our GoFundMe campaign.

The johnlothiannews.com website was moved to a new hosting provider over the weekend. Thank you to Jeff Bergstrom, our CIO, for all of his hard work in moving the site.

We would like to secure some additional responses to our demographic survey so we are adding to the benefits for filling it out. We had offered three $100 donations to a charity of your choice. We are now adding a $250 Amazon gift card to one person who fills out the survey and shares their contact information. So now we will draw for one person to get the $250 Amazon gift card and then pull three more names for the $100 donations to a charity of their choice.

Please fill out our survey by clicking HERE or on the image above.

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

*****

Things continue to look bleak for XRP, the digital asset created by Ripple, as exchanges all over the world announce their plans to de-list or halt trading for it due to the SEC’s lawsuit against Ripple. Cryptocurrency exchange Kraken is set to halt trading for XRP for U.S. customers, according to an announcement published January 15.~MR

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Cannabis Shares Pick Up Pace As 2021 Regulatory Momentum Eyed
JohnLothianNews.com

Saleem Daya, an analyst with Nasdaq IR Intelligence in Toronto, sees U.S. cannabis regulation poised for a rehaul in 2021 given Democrats’ U.S. Senate win. While he acknowledges some uncertainty, he told JLN that U.S. reform and the implications of Mexico’s legalization efforts are expected to provide new opportunities for sector growth.

Listen to the podcast »

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Sponsored Content
【Special Report】 First year anniversary workshop of TOCOM/JPX Electricity Futures

Asia’s Most Successful Electricity Futures at Tokyo Commodity Exchange (TOCOM)/Japan Exchange Group (JPX) celebrated its first year of listing in a co-hosted webinar with Quick Corp. on December 15, 2020. The event was attended by over 250 people from 152 companies.

At the workshop, Mr. Hatakeyama, Director-General for Commerce and Service Industry Policy of METI gave an opening remarks and Mr. Ishibashi of Astmax Trading, Inc. gave a keynote speech on Electricity trading and Risk management. In the panel discussion, traders from different power companies shared their experiences in using TOCOM Electricity Futures and their internal risk control systems. They pointed out that there is still a huge opportunity in Electricity Futures market in Japan and requested the exchange to list new products such as those covering the Hokkaido and Kyushu areas and change the product design to extend contract months.

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Historians having to tape together records that Trump tore up
The Guardian
The public will not see Donald Trump’s White House records for years, but there is growing concern the collection will never be complete – leaving a hole in the history of one of America’s most tumultuous presidencies.
Trump has been cavalier about the law requiring that records be preserved. He has a habit of ripping up documents before tossing them out, forcing White House workers to spend hours taping them back together.
/bit.ly/35OkvbJ

*****Nancy Pelosi was not the only one ripping up documents.~JJL

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Social-Media Algorithms Rule How We See the World. Good Luck Trying to Stop Them; What you see in your feeds isn’t up to you. What’s at stake is no longer just missing a birthday. It’s your sanity—and world peace.
Joanna Stern – WSJ
It’s hard to pinpoint exactly when we lost control of what we see, read—and even think—to the biggest social-media companies. I put it right around 2016. That was the year Twitter and Instagram joined Facebook and YouTube in the algorithmic future. Ruled by robots programmed to keep our attention as long as possible, they promoted stuff we’d most likely tap, share or heart—and buried everything else.
/on.wsj.com/2NfNHC7

*****These algorithms control what you see and react…Squirrel!!!!!

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Online Extremism Expert Says Far Right Has Adapted ISIS Playbook; SITE Intelligence’s Rita Katz on the growing threat of a “more radicalized and dangerous” underground in America.
Joshua Brustein – Bloomberg
Rita Katz, the founder of SITE Intelligence, which tracks extremism online, says the growth in right-wing radicalization in the U.S. stems from President Trump’s behavior and the dynamics of social media. What are the parallels between the right-wing radicalization efforts online and those of other extremist groups like ISIS?
/bloom.bg/3nOj8QA

*****The capitol sacking was just a battle; the war is still on.~JJL

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Vaccines won’t get us back in the office any time soon; Employers wanting mandatory staff Covid shots need to think again
Pilita Clark – FT
What would you do if your boss announced the latest perk at work was free breakfast at the Waffle House? How about the chance to win a TV in a raffle? Or an Airbnb gift card or a bicycle? In the annals of staff benefits, this is relatively meagre stuff, especially considering the strings attached. These are just some of the incentives US employers have launched to tempt reluctant staff to get a Covid vaccine.
/on.ft.com/3oUIayR

******Not everyone agrees on vaccines, some for good reasons, others for not so good reasons.~JJL

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Friday’s Top Three
Our top story Friday was John Lothian’s commentary, NFA Bars Futures Broker Gary Fullett From Membership For Five Years; Surprising It Took This Long. Second was Yahoo!News’ Exclusive: Large bitcoin payments to right-wing activists a month before Capitol riot linked to foreign account. Third was Arrested Capitol rioters had guns and bombs, everyday careers and Olympic medals, from Reuters.

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Lead Stories

Biden’s Wall Street Watchdogs Signal New Era of Tough Oversight
Benjamin Bain, Jennifer Epstein, and Robert Schmidt – Bloomberg
Picks for SEC and CFPB are favorites among progressives; Gensler and Chopra are expected to have aggressive agendas
President-elect Joe Biden’s team of financial regulators is taking shape, with progressive favorites being chosen for the top jobs at the Securities and Exchange Commission and the Consumer Financial Protection Bureau — moves that mean Wall Street should prepare itself for a new era of tougher oversight and stricter rules.
/bloom.bg/2XN8xuu

Euronext shuffles Paris business leadership ahead of Borsa Italiana takeover; Delphine d’Amarzit joins Euronext Paris as chief executive, replacing Anthony Attia who will become global head of primary markets and post-trade at a group level at Euronext.
Annabel Smith – Euronext
Pan-European exchange operator Euronext has appointed a new chief executive of its business in Paris as the former CEO assumes a new senior role to oversee the integration of Borsa Italiana. Delphine d’Amarzit will join Euronext Paris as chief executive officer in March from Orange Bank where she has been deputy chief executive for nearly five years.
/bit.ly/35Tf2QT

*****Here is the press release from Euronext about this appointment.~JJL

France, Once a Vaccine Pioneer, Is Top Skeptic in Covid-19 Pandemic; Covid-19 vaccination campaign off to a glacial start, as it meets some of the world’s highest skepticism rates. ‘I can’t be the guinea pig.’
Matthew Dalton – WSj
Audrey Courreges’s mistrust of new coronavirus vaccines runs so deep that she’s told the nursing home where she works, in the southern French town of Beziers, that she won’t take the vaccinations or administer them. “I have a brain. I’m capable of forming my own ideas,” the 33-year-old nurse says. “There is some mistrust of the authorities on my part, when you see how the crisis has been managed in France from the start.”
/on.wsj.com/3qwtp5z

One Year, 400,000 Coronavirus Deaths: How the U.S. Guaranteed Its Own Failure; After the White House declined to pursue a unified national strategy, governors faced off against lobbyists, health experts and a restless public consumed by misinformation.
Sarah Mervosh, Mike Baker, Patricia Mazzei and Mark Walker – NY Times
The path to beating the coronavirus was clear, but Kelley Vollmar had never felt so helpless. As the top health official in Missouri’s Jefferson County, Ms. Vollmar knew a mandate requiring people to wear masks could help save lives. She pressed the governor’s office to issue a statewide order, and hospital leaders were making a similar push. Even the White House, at a time when President Trump was sometimes mocking people who wore masks, was privately urging the Republican governor to impose a mandate.
/nyti.ms/2XTpYcO

Wall Street’s new sheriff is on a mission; Joe Biden’s likely choice for Securities and Exchange Commission chair will shake things up
Rana Foroohar – FT
Financial markets may soon have a new regulatory sheriff. President-elect Joe Biden, who will be inaugurated on Wednesday, is expected to pick the former head of the US Commodity Futures Trading Commission, Gary Gensler, to run the Securities and Exchange Commission. Given that US capital markets are the broadest and deepest in the world, the chair of the SEC is not only the most important market regulator for America but also, arguably, for the wider world. The good news is that Mr Gensler is exactly the right man for the job.
/on.ft.com/3oWb4P4

An Old Foe of Banks Could Be Wall Street’s New Top Cop; Gary Gensler is expected to be Joe Biden’s pick to take over the Securities and Exchange Commission. ‘He will do things that are controversial.’
Paul Kiernan and Scott Patterson – WSJ
President-elect Joe Biden’s expected pick of Gary Gensler to lead the Securities and Exchange Commission could give Wall Street its most aggressive regulator in two decades. The finance industry has thrived under the Trump administration’s light regulatory touch. Mr. Gensler, who sources familiar with the transition say is likely to be tapped by Mr. Biden for SEC chairman, has a history of shaking up the status quo. If he gets the assignment, he would be tasked with toughening regulation and enforcement of public companies and the finance industry.
/on.wsj.com/39zpBcM

Cryptocurrencies Face Greater Oversight Under Gensler-Led SEC
Olga Kharif – Bloomberg
Former CFTC head has long advocated federal regulation; Gensler has said oversight could boost mainstream adoption
Gary Gensler’s expected nomination to lead the U.S. Securities and Exchange Commission is seen ushering in an era of greater federal oversight of the $1 trillion cryptocurrency market. Gensler, who most recently taught about cryptocurrencies and their underlying technologies at the Massachusetts Institute of Technology, previously chaired the Commodity Futures Trading Commission and was a partner at Goldman Sachs Group Inc. He is known for pushing back at banks and corporations in search of greater investor protections.
/bloom.bg/2LI2ftB

Will Covid-19 Shake Up Capitalism? The pandemic sped up demands for changes in the economic system. Shareholders might want to brace for change.
James Mackintosh – WSJ
The Covid crisis both accelerated demands for changes to the economic system and demonstrated that governments can spend freely to help those in trouble when they wish. Will capitalism be changed as a result? To answer the question, it is worth looking back a decade to the aftermath of the global financial crisis. Occupy Wall Street was the protest group du jour, and governments had just allocated trillions of dollars to rescue the financial system. Aside from bank reforms, capitalism (though not global trade) survived pretty much unscathed. This time might be different, because the past decade has prepared the ground for a shift to more interventionist government. The stunning shareholder returns of the past decade hang in the balance.
/on.wsj.com/3sAH5yf

Biden Taps Gensler as SEC Chairman, FTC’s Chopra as CFPB Chief
Jennifer Epstein and Benjamin Bain – Bloomberg
Moves signal incoming administration will be tougher on banks; Gensler battled with banks over derivatives rules as CFTC head
President-elect Joe Biden has picked a pair of veteran regulators strongly backed by progressive Democrats to lead two key Wall Street watchdogs, signaling that his administration is planning tough oversight after four years of light-touch policies under appointees of President Donald Trump.
/bloom.bg/2XRFC8I

FBI probing if foreign governments, groups funded extremists who helped execute Capitol attack
Ken Dilanian – NBC News
The FBI is investigating whether foreign governments, organizations or individuals provided financial support to extremists who helped plan and execute the Jan. 6 attack on the Capitol, one current and one former FBI official told NBC News. As part of the investigation, the bureau is examining payments of $500,000 in bitcoin, apparently by a French national, to key figures and groups in the alt-right before the riot, the sources said. Those payments were documented and posted on the web this week by a company that analyzes cryptocurrency transfers. Payments of bitcoin, a cryptocurrency, can be traced because they are documented on a public ledger.
/yhoo.it/3bOwjP6

After Stock Surge, Investors Ask Companies What’s Ahead; Rise of major indexes despite the worsening toll of the pandemic underscores the pressure on big companies
Karen Langley – WSJ
An epic stock rally faces a key test in coming weeks as investors learn what executives expect for profits and revenues in coming periods. Fourth-quarter earnings season kicked off in earnest Friday with better-than-expected profits from some of the nation’s largest banks. Despite a record quarterly profit at JPMorgan Chase & Co. and some bright spots at Citigroup Inc. and Wells Fargo WFC -7.80% & Co., shares of all three declined, with Wells and Citi each dropping more than 6%.
/on.wsj.com/2XQEGBy

HSBC Chairman Gives Hints of Looming Strategy Revamp
Harry Wilson – Bloomberg
Tucker says ‘world has changed’ since last year’s overhaul; Bank expected to update strategy alongside earnings next month
HSBC Holdings Plc plans to accelerate its expansion across Asia in its imminent strategy refresh, according to Chairman Mark Tucker. Tucker said “the world had changed” in the 11 months since Europe’s biggest bank announced a long-awaited overhaul, forcing the lender to make its plans more radical.
/bloom.bg/3nPqmDO

Norway Finds No Direct Link Between Elderly Deaths and Vaccine
Lars Erik Taraldsen – Bloomberg
Health authorities in Norway say there’s no evidence of a direct link between the recent string of deaths among elderly people inoculated against Covid-19, and the vaccine they received. The Norwegian Medicines Agency is seeking to address fears that taking the vaccine might be too risky, after 33 people in the country aged 75 and over died following immunization, according to the agency’s latest figures. All were already seriously ill, it said.
/bloom.bg/35TMvdU

FBI vetting 25,000 National Guard troops in DC amid fears of insider attack
Lolita C. Balddor – Associated Press
U.S. defense officials say they are worried about an insider attack or other threat from service members involved in securing President-elect Joe Biden’s inauguration, prompting the FBI to vet all of the 25,000 National Guard troops coming into Washington for the event.
/bit.ly/35SB5qR

Coronavirus

U.S. Deaths Near 400,000; Brazil Approves Vaccines: Virus Update
Bloomberg News
We’re tracking the latest on the coronavirus outbreak and the global response. Sign up here for our daily newsletter on what you need to know. Another 3,830 people in the U.S. died of causes related to Covid-19, keeping the country on track to reach 400,000 deaths before President-elect Joe Biden’s inauguration on Wednesday. Biden’s promise of delivering 100 million doses of the vaccine in 100 days is “absolutely a doable thing,” Dr. Anthony Fauci said.
/bloom.bg/39DZjpW

Covid-19 Vaccines Are Getting Stuck at the Last Step; Local governments, hospitals and clinics have the doses, but not the resources to organize getting them to the right people
Elizabeth Findell, Jared S. Hopkins and Dan Frosch – WSJ
In South Texas, a man slept in his car for two nights straight so he wouldn’t lose his place in a line of hundreds of people at a mass-vaccination event. In Western Kentucky, residents registered for vaccination slots online, only to find when they arrived that their doses had been taken by walk-ins. In New Mexico, state officials scrambled to hire more people to staff a vaccination hotline after it was overwhelmed with callers.
/on.wsj.com/3qxFx6a

Covid-19’s Blow to Business Travel Is Expected to Last for Years; Local jobs and economies take the brunt from the decline in corporate trips and conferences
Doug Cameron and Eric Morath – WSJ
The coronavirus pandemic delivered a lingering, and possibly permanent, hit to business travel that is likely to weigh on employment and economic growth in some communities for years. Beyond the blows to airlines, hotels, travel agents and rental-car companies, the drop in business travel is rippling through whole ecosystems of related commerce, including airport shops, downtown bars and restaurants, construction companies building convention stages, entertainers, taxi drivers and aircraft-parts manufacturers.
/on.wsj.com/3sw0KiS

Latest Covid-19 Lockdown Slams U.K. Business Owners; Shifting pandemic rules make it hard to plan on inventory and staffing. And then there is Brexit.
Alistair MacDonald and Saabira Chaudhuri – WSJ
Ed Mason has 91,000 pints of beer at risk in the U.K.’s third pandemic lockdown, the latest in a series of strict restrictions on business that has sapped morale and made even simple planning a nightmare.
/on.wsj.com/3sB8Pmk

How to Get the Coronavirus Vaccine in New York City; There are multiple websites, disappearing slots and even attempts to game the system. Here’s our guide to what you have to do to get a dose in your arm.
Ron Lieber – NY Times
It isn’t easy, and it’s probably going to be that way for a while. Right now, there are more eligible people than doses of vaccine. You need diligence and luck. People are swapping tips in text chains and social media groups to try to gain an edge, and there is a dizzying array of websites and phone numbers to keep track of.
/nyti.ms/38QGe4z

Covid-19 Vaccine Leaders Waited Months to Approve Distribution Plans; Holdup left states with little time to develop mass-vaccination plan; U.S. says it needed time for interagency clearance
Betsy McKay, Rebecca Ballhaus and Stephanie Armour – WSJ
Operation Warp Speed leaders waited more than two months to approve a plan to distribute and administer Covid-19 vaccines proposed by U.S. health officials, administration officials said, leaving states with little time to implement a mass-vaccination campaign amid a coronavirus surge.
/on.wsj.com/3sBqfzt

Why the New Covid-19 Variants Could Be More Infectious; Mutations in the virus’s appendage have created potentially more infectious versions of the pathogen, including one currently circulating around the world
Daniela Hernandez and Alberto Cervantes – WSJ
As viruses replicate, they change, or mutate. Some mutations give these viral variants an edge, such as being better able to latch on to and infect human cells. That’s what scientists think happened with the coronavirus variant that swept through the U.K. recently and which is now showing up in states across the U.S.
/on.wsj.com/2KoHAdv

Japan’s suicides jump 16% in COVID-19 second wave after fall in first wave: study
Reuters Staff
Suicide rates in Japan have jumped in the second wave of the COVID-19 pandemic, particularly among women and children, even though they fell in the first wave when the government offered generous handouts to people, a survey found.
/reut.rs/38Qjfa2

Trump administration accused of deception in pledging release of vaccine stockpile
Peter Szekely, Steve Gorman – Reuters
The governors of several states accused the Trump administration on Friday of deception in pledging to immediately distribute millions of COVID-19 vaccine doses from a stockpile that the U.S. health secretary has since acknowledged does not exist.
/reut.rs/35PRzjB

Vaccine Disparities Raise Alarm as Covid Variants Multiply
James Paton – Bloomberg
Pockets without access may breed dangerous viral strains; Economic stakes are huge as nations race to slow coronavirus
Global gaps in access to Covid-19 vaccines are raising concerns that the continued spread of the coronavirus will breed more dangerous versions of the pathogen, weakening medical weapons and further crippling economies.
/bloom.bg/3imzD54

Germany to Extend Lockdown Until Mid-February, Mulls Curfew
Iain Rogers and Arne Delfs – Bloomberg
Finance Minister expects curbs to last until at least Feb. 14; Scholz sees signs measures are starting to have an effect
Germany will likely extend lockdown measures until at least mid-February and may impose a nighttime curfew in coronavirus hot spots. Chancellor Angela Merkel and state premiers are due to decide on the latest strategy to stem the spread of the disease during a video call on Tuesday. The talks, originally planned for Jan. 25, were brought forward after the German leader warned of the risks posed by variants that can spread more quickly.
/bloom.bg/2XS2Nj6

England Aims for Early March Lockdown Easing Under Vaccine Plan
Emily Ashton and Alex Morales – Bloomberg
Zahawi sees ‘gradual lifting’ of curbs in early or mid-March; U.K. government rolls out mass vaccination program to over-70s
The U.K. government will aim to start lifting the pandemic lockdown in the first half of March, after stepping up its mass vaccination program this week. Vaccines Minister Nadhim Zahawi said a gradual easing of restrictions could begin in the “first, second week of March.” He said it needed to be two to three weeks after the mid-February target to vaccinate the four most vulnerable groups so that the shots could take effect.
/bloom.bg/2XP7M4j

England extends Covid vaccines to over-70s; Relaxation of curbs by March depends on programme staying on track, says foreign secretary
Jim Pickard – FT
People aged over 70 will start receiving invitations for their first Covid-19 vaccination from Monday, along with the clinically extremely vulnerable, as the programme enters a new phase.
/on.ft.com/2XQlZ0K

Chinese and Russian vaccines in high demand as world scrambles for doses; Sales represent coup for Beijing and Moscow, even as concerns over pharma standards linger
Christian Shepherd and Max Seddon – FT
Chinese and Russian manufacturers are seeing growing appetite from foreign buyers for their Covid-19 vaccines as the international scramble for jabs intensifies, despite lingering concerns over incomplete trial data and the rigour of domestic approval processes.
/on.ft.com/3oTJD8o

Exchanges, OTC and Clearing

Stellantis lists on Euronext Paris; MARKET CAPITALISATION OF EUR39.2bn
Euronext
Euronext today welcomes Stellantis, one of the world leaders in the automobile industry, to Compartment A of Euronext’s regulated market in Paris (ticker code: STLA). The Stellantis shares will also begin trading today on Borsa Italiana in Milan and on 19 January on the New York Stock Exchange (NYSE).
/bit.ly/3sCB2sY

New appointments at Euronext
Euronext
Euronext today announced that Delphine d’Amarzit has been appointed by the Supervisory Board of Euronext N.V. as CEO of Euronext Paris and member of the Managing Board of Euronext N.V., subject to regulatory and shareholder approvals, starting from 15 March 2021. Delphine d’Amarzit joins from Orange Bank where, as Deputy CEO, she was responsible for the oversight of the Operations, Credit, Finance, Risk and Compliance functions. Delphine d’Amarzit holds an extensive knowledge of European and French capital markets, notably having held senior positions within the French Treasury Department for several years with responsibilities for capital markets development, European financial regulation, and corporate financing. From 2007 to 2009, she was also in charge of financial and economic affairs at the office of the Prime Minister where she participated in the definition of the public response to the financial crisis, rescue package and recovery plans and coordinated the action on all matters related to economic reform and financial services.
/bit.ly/39FRakQ

UPDATE: Regulatory Relief Concerning COVID-19 Pandemic
CME Group
The Exchanges have been apprised that CFTC Market Participants Division and Division of Market Oversight staff no-action relief extending certain temporary no-action relief granted in response to the COVID-19 pandemic is under review currently and is expected to be issued early next week. Information regarding CFTC staff no-action relief is posted on the CFTC’s website here.
/bit.ly/3sz8xfV

Product Modification Summary: Expansion of the 6.25 Basis Point Strike Price Listing Schedule of the Options on Three-Month Eurodollar and Three-Month SOFR Futures Contracts – Effective January 25, 2021
CME Group
Expansion of the 6.25 Basis Point Strike Price Listing Schedule of the Options on Three-Month Eurodollar and Three-Month SOFR Futures Contracts
/bit.ly/39DqhxY

New Product Summary: Initial Listing of the Ether Futures Contract – Effective February 8, 2021
CME Group
/bit.ly/3qvxXt4

Withdrawal of Application for Gold (Enhanced Delivery) Regularity
CME Group
Notice is hereby given that The Commodity Exchange, Inc. (“COMEX” or “Exchange”) has been notified that Malca-Amit (U.K.) Limited has voluntarily withdrawn their application for Gold (Enhanced Delivery) regularity in the London, United Kingdom region.
/bit.ly/3sAahp9

CPMI-IOSCO Public Quantitative Disclosure Standards for Central Counterparties
CME Group
As a reminder, CME Clearing publishes quantitative disclosure (“PQDs”) reports in line with CPMI-IOSCO public quantitative standards for central counterparties. Reports and presentations are available in the following webpage: https://www.cmegroup.com/clearing/cpmi-iosco-reporting.html.
/bit.ly/3sCW4Ib

Updated Live Date: File Format Change – CST550IM New Column – Effective February 22, 2021
CME Group
Starting at Intraday (ITD) on February 22, 2021 (previously planned for December 14, 2020), a new column will be added immediately following the ‘AssetPBAmountApplied’ column.
/bit.ly/39LGlO2

JPX Monthly Headlines – December 2020
JPX
JPX group companies undertake various initiatives and disseminate information with the aim of providing the most attractive markets to all users.
December 2020
IPO Update for 2020
Dec. 14: Publication of Report on Pilot Test of DLT Information Sharing Platform in the Field of Securities Post-Trade
Dec. 22: Scheduled Go-Live Date of J-GATE3.0
Dec. 25: Publication of Development of Listing Rules for Cash Equity Market Restructuring (Second Set of Revisions)
Dec. 25: Index Consultation on Revisions of TOPIX and Other Indices
Dec.30: Ceremony on Last Trading Day of 2020
/bit.ly/3oMpam5

LCH SA’s RepoClear Expands Settlement Connections; Demonstrates LCH’s continued commitment to customer choice and open access
Mondovisione
From today, Monday 18 January 2021, RepoClear has extended its settlement connections to investor CSDs so that members are now able to settle:Belgian and French Government bonds at Clearstream Banking Frankfurt; Spanish Government bonds at Euroclear France; French and German Government bonds at Iberclear (BME); A full list of settlement venues connecting to RepoClear SA can be found on the LCH website: https://www.lch.com/services/repoclear/repoclear-sa
/bit.ly/35Nk0i4

Iberclear incorporates settlement of German and French fixed income securities cleared in LCH
FXNewsGroup
Iberclear, the Spanish Central Securities Depository and a BME company, is incorporating from today the settlement of German and French government debt securities and certain bonds cleared in LCH SA, following the agreement signed with this clearing house.
/bit.ly/38TP7dE

Fintech

Atos Is Said to Lobby Its Top Shareholders to Back DXC Bid
Dinesh Nair and Helene Fouquet – Bloomberg
Approach driven by French tech services group’s need for scale; IT outsourcers struggling to hold their own in shift to cloud
Atos SE’s management is talking with some of the French IT outsourcing company’s biggest investors to try to win their support for a takeover of U.S. competitor DXC Technology Co., according to people familiar with the matter.
/bloom.bg/3nQzcBg

Digital Transformation Trends in Financial Services: What to Look for in 2021
Andrew Dunmore – Maven Wave
Time will tell how the year 2020 is seen in the rearview, but one thing is certain: it wasn’t dull. The global COVID-19 pandemic altered everyone’s playbook for the year, and the impacts of remote work, online meetings, and social distancing will be felt for years to come. While it’s too early to tell what all of the long term impacts will be, topics that we covered in our blogs and white papers this past year give a good indication of topics and ideas that are likely to occupy our time in the year ahead.
/bit.ly/3bRaPkK

Fitch invests in AI start-up to improve bank misconduct detection; Credit rating agency seeks to expand how it evaluates lenders’ riskiness amid raft of scandals
Stephen Morris – FT
Fitch Ratings has struck a partnership with a French artificial intelligence start-up as it seeks to improve its early detection of misconduct after a spate of high-profile banking scandals around the world.
/on.ft.com/3bTB5e3

BlackRock expands sustainable insights on Aladdin with stake in data science firm; Sustainable investing analytics will be added to Aladdin after BlackRock took minority stake in data science firm Clarity AI.
Hayley McDowell – The Trade
Asset management heavyweight BlackRock has taken a minority stake in data science and sustainable investing analytics firm, Clarity AI, which will be integrated with its Aladdin platform.
/bit.ly/2XGy9ci

Broadridge Names APAC COO To Help Drive Industry Solutions Across The Region
Mondovisione
To meet growing demand for delivering technology solutions to financial institutions in Asia Pacific (APAC), Broadridge Financial Solutions, Inc. (NYSE:BR), a global Fintech leader, today announced the appointment of David Ingleson as Chief Operating Officer (COO) for APAC, effective immediately. Based in Singapore, Ingleson will report to Samir Pandiri, President of Broadridge International. In this role, he will oversee regional implementation strategies for Broadridge, direct operations and support of Capital Markets clients in the region, and focus on further investing in Broadridge’s local market expertise and capabilities.
/bit.ly/2NgDsNS

Fintech and solar startups kept funding up in Africa’s ecosystem in 2020 despite the pandemic
Abubakar Idris – Quartz Africa
Despite a downturn in Africa’s economy for the first time in 25 years in the wake of the global pandemic, investor interest in the continent’s tech ecosystem remained strong in 2020 as startup funding crossed the $1 billion-mark again as it did for the first time in 2019. Investors poured at least $1.3 billion of venture capital, including undisclosed rounds, into African startups with around $1.07 billion of these deals publicly disclosed, a 14.4% decrease from the $1.25 billion deals announced in 2019, says a new report from Briter Bridges.
bit.ly/3qCaJS9

Jamie Dimon says JPMorgan Chase should absolutely be ‘scared s—less’ about fintech threat
Hugh Son – CNBC
Jamie Dimon’s message to the management team of $3.4 trillion banking goliath JPMorgan Chase: Be frightened of fintech rivals. “Absolutely we should be scared s—less about that,” Dimon told analysts. Dimon said he sent his deputies a list of global competitors, and that PayPal, Square, Stripe, Ant Financial as well as Amazon, Apple and Google were names the bank needs to keep an eye on.
cnb.cx/3sL2uVI

Cryptocurrencies

Coinbase Redoing Infrastructure to Prevent Outages During Peak Times
William Foxley – Yahoo Finance
Coinbase will break apart certain parts of its Coinbase.com and app infrastructure in a bid to keep the cryptocurrency exchange from going down during periods of high volume. During the recent bitcoin bull run, Coinbase has struggled to keep itself up during stretches of heavy volume, leading to snarky comments on Twitter and Reddit that it’s only news when the exchange doesn’t go down during peak periods. Given the exchange has filed preliminary documents for a public listing of the company’s shares, fixing its infrastructure undoubtedly has undoubtedly taken on an even greater urgency.
/yhoo.it/3sBoimD

Bitcoin Swings Undermine CFO Case for Converting Cash to Crypto
Olivia Raimonde – Bloomberg
Corporate buys would be a ‘red flag’ for investors: O’Rourke; MicroStrategy and Square have both moved reserves into tokens
Wall Street finance executives who were thinking of plunging some of their company’s cash reserves into Bitcoin got a heat check this week. Chief financial officers, not generally known as a risk-loving bunch, watched Bitcoin sink more than 25% in a 24-hour period starting Sunday. Burning a hole of that size in the corporate rainy day fund would amount to a career-ending wipeout at virtually any S&P 500 firm.
/bloom.bg/3infFYa

Bitcoin Fee Wars Erupt as Upstart Targets Grayscale’s Billions
Katherine Greifeld and Vildana Hajric – Bloomberg
OBTC’s fee is a fourth of what Grayscale’s trust charges; Demand for crypto-focused products has surged amid bull run
The fledging world of cryptocurrency funds is set to welcome a bold new entrant. The Osprey Bitcoin Trust (ticker OBTC) will launch in the over-the-counter markets with a 0.49% management fee, according to the Osprey Funds website. Fidelity Digital Assets will provide custody services.
/bloom.bg/3szrq2h

CoinLab Cuts Deal With Mt. Gox Trustee Over Bitcoin Claims
Matthew Leising – Bloomberg
Offer is for 90% of remaining Bitcoin tied up in bankruptcy; Mt. Gox creditors must approve the settlement by a vote
Creditors seeking to regain Bitcoin lost on the Japanese exchange Mt. Gox in 2014 have a chance to get their digital assets back before legal claims are settled. CoinLab Inc. said an agreement with Nobuaki Kobayashi, the trustee to the Mt. Gox bankruptcy, and MGIFLP, a unit of Fortress Investment Group LLC, will allow creditors to consider an offer of as much as 90% of the remaining Bitcoin tied up in the bankruptcy.
/bloom.bg/35ScC4W

Iran Reportedly Seizes 45K Bitcoin Mining Machines After Closure of Illegal Operations
Sebastian Sinclair – Coindesk
Authorities in Iran have seized tens of thousands of bitcoin mining machines claimed to have been using illegally subsidized electricity from state-run energy provider Tavanir.
/yhoo.it/3oWVVwK

Coinbase, MEVP Invest in Crypto-Asset Startup Rain
Nour Al Ali – Bloomberg
Rain Financial Inc., which operates a crypto-asset platform used mainly in the Middle East and North Africa, raised $6 million, securing backing from Coinbase Inc., the biggest cryptocurrency exchange in the U.S.
/bloom.bg/2XNJkQE

Bitcoin securities trading surges as investors seek crypto exposure; German exchange traded product garners volumes matching those of popular European funds
Steve Johnson – FT
Investors have raced to buy and sell bitcoin-linked securities on both sides of the Atlantic, with one German exchange traded product garnering trading volumes matching Europe’s most popular funds.
/on.ft.com/3ihKXj1

Galaxy Digital is launching a new bitcoin mining business unit
MK Manoylov – The Block
Crypto investment company Galaxy Digital announced Friday that it is launching a new suite of financial services and tools for the bitcoin mining sector. What’s more, the Toronto-listed firm is also mining bitcoin for itself via a third-party, U.S.-based data center, which is hosting hardware owned by Galaxy. Galaxy’s new business unit, dubbed Galaxy Digital Mining, aims to offer “one-stop financial services” for miners, according to a statement published Friday. Amanda Fabiano, who previously served as Fidelity Digital Assets’s Director of Bitcoin Mining, will lead the unit.
bit.ly/3oZlbCD

Crypto Long & Short: No, Bitcoin Is Not in a Bubble
Noelle Acheson, Damanick Dantes – Coindesk
To think that such a festive concept, one that evokes both sophistication and childlike wonder, could become so financially charged … Last week, Bank of America Securities chief investment strategist Michael Hartnett said in a note that bitcoin looks like “the mother of all bubbles.” Harnett seems to be using the strength and speed of bitcoin’s price rise as the base for his diagnosis, as if that is the main feature of a financial bubble. It isn’t.
bit.ly/38Scjcg

Ripple Is Hiring Director of Engineering for RippleX Platform
Tanzeel Akhtar – Coindesk
Blockchain firm Ripple is hiring a new director of engineering to lead the team building its open-source developer services for its payments platform RippleX. In a blog post, the blockchain firm said it is looking for an engineer to expand its infrastructure that supports Ripple technologies such as XRPL as well as other developer tools and services. The role involves shipping products that make it easier for its developers to actualize the future of the “Internet of Value” which is a concept proposed by Ripple where value is transferred as easily as data.
bit.ly/2XRVojW

Politics

Gary Gensler Is Picked to Lead S.E.C.; The Biden administration also named Rohit Chopra as the head of the Consumer Financial Protection Bureau, in moves that would bring Obama-era regulators to oversee key financial agencies.
Matthew Goldstein, Lauren Hirsch and Andrew Ross Sorkin – NY Times
The Biden administration said on Monday that it is tapping two financial regulators from the Obama administration to oversee key departments that had loosened their grip of the industry under President Trump.
/nyti.ms/3qzKHi3

Corporate America Flexes Its Political Muscle; Big business breaks with Republicans.
The New York Times
It was a long week in the fraught relationship between Washington and corporate America. Dozens of companies announced that they will end political donations to the Republicans who challenged the Electoral College count, or pause giving to all politicians.
/nyti.ms/35PhEiM

Trump Is on the Verge of Losing Everything
Jonathan Chait – NY Magazine
President Trump’s second impeachment, like the other repudiations he has suffered, feels provisional. He is never quite banished. He is impeached, but Senate Republicans refuse to convict or even allow evidence into his trial. He loses the election, but won’t concede, and may just run again. He is impeached again, but his trial is delayed until after his departure date. It feels as if we have spent four years watching the wheels come off, yet the vehicle somehow still keeps rolling forward.
/nym.ag/3sBoRwL

Manchin: Removing Hawley, Cruz with 14th Amendment ‘should be a consideration’
Tal Axelrod – The Hill
Sen. Joe Manchin (D-W.Va.) said the Senate should consider removing Sens. Josh Hawley (R-Mo.) and Ted Cruz (R-Texas) via the 14th Amendment over their objections last week to the Electoral College results.
/bit.ly/2N5oRVg

Misinformation dropped dramatically the week after Twitter banned Trump and some allies;Zignal Labs charts 73 percent decline on Twitter and beyond following historic action against the president
Elizabeth Dwoskin and Craig Timberg – Washington Post
Online misinformation about election fraud plunged 73 percent after several social media sites suspended President Trump and key allies last week, research firm Zignal Labs has found, underscoring the power of tech companies to limit the falsehoods poisoning public debate when they act aggressively.
/wapo.st/2LI0RqT

Inside Twitter’s Decision to Cut Off Trump; Jack Dorsey, the chief executive, had reservations about locking the president’s account. But the calls for violence that his tweets provoked were too overwhelming.
Kate Conger and Mike Isaac – NY Times
Jack Dorsey, Twitter’s chief executive, was working remotely on a private island in French Polynesia frequented by celebrities escaping the paparazzi when a phone call interrupted him on Jan. 6.
/nyti.ms/3qsC355

Germany’s CDU Elects Merkel Loyalist Laschet as Party Leader
Arne Delfs and Raymond Colitt – Bloomberg
Germany’s dominant party voted for continuity on Saturday by electing Armin Laschet as leader, opting for the candidate who most resembles outgoing chancellor, Angela Merkel, in policy and style.
/bloom.bg/2LXor2U

U.S. state capitals, Washington on alert for possible pro-Trump armed protests
Nathan Layne, Patricia Zengerle – Reuters
Ten days after rioters breached the U.S. Capitol in a deadly attack that stunned the world, cities nationwide were girding for a potential new wave of violent protests over the weekend, erecting barriers and deploying thousands of National Guard troops.
/reut.rs/3qvl2r6

Trump Aims to End Ethanol Warnings in Biofuel Policy Blitz
Jennifer A Dlouhy and Kim Chipman – Bloomberg
EPA seeks changes on storage tanks that could spur E15 sales; EPA also wants input on governors’ bid to pare biofuel quotas
The Trump administration advanced a flurry of biofuel policy proposals Friday, including plans that could help ethanol producers sell more of the corn-based fuel.
/bloom.bg/3qyKonZ

It’s Trump’s Money, Not His Brand, That Should Worry Him; Brother, can you spare a dime? Now even Deutsche Bank says no.
Timothy L. O’Brien – Bloomber
The Trump Organization and its namesake are going to be financially squeezed after the current president of the United States leaves office next week. But I suspect most of the company’s challenges won’t involve the Trump “brand” that has drawn so much speculation.
/bloom.bg/35M16bd

The Mooch on The Mooch: Anthony Scaramucci Has a Few Thoughts
Hema Parmar – Bloomberg
He lasted just 11 days in Donald Trump’s White House; Looking back, the fund manager reflects on what it all means
The Mooch, a.k.a., Anthony Scaramucci, wants to get a few things straight about those 11 days in the White House. Yes, he has regrets. He was, he says, seduced by it all — by the presidency, the Oval Office, Air Force One, the lot of it. He’s a “flawed” person, a bit of a “romantic.” He’s tried to atone for his “mistake” — his word — of serving Donald John Trump.
/bloom.bg/35PxSZc

China Slams U.S. Covid Lab Claims as ‘Conspiracy Theories’
Bloomberg News
Beijing denounces speculation virus linked to Wuhan facility; U.S. State Department says researchers at lab got sick in 2019
China accused the U.S. of spreading “lies” and “conspiracy theories” after the Trump administration said it had new information suggesting the coronavirus might have emerged from a Chinese laboratory.
/bloom.bg/38Rp6fd

Regulation

FSA to assist foreign financial firms entering Japan in English
Kyodo News
The Financial Services Agency has launched an office to help foreign financial firms with all the regulatory processes needed to enter Japan — from pre-application consultation to supervision and inspection after registration — with all communication available in English.
/bit.ly/3ikpTbL

Swiss Find $10 Billion in Suspicious Venezuelan Funds: Report
Jeff Black – Bloomberg
Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.nSwiss prosecutors have identified bank accounts containing some 9 billion francs ($10.1 billion) that may have come from embezzled public funds in Venezuela, newspaper Le Matin Dimanche reported.
/bloom.bg/3quNJnM

Member obligations under NFA Bylaw 1101 and Compliance Rule 2-36(d) with respect to CPOs/CTAs exempt from registration
NFA
The CFTC requires any person that claims an exemption from CPO registration under CFTC Regulation 4.13(a)(1), 4.13(a)(2), 4.13(a)(3), 4.13(a)(5), an exclusion from CPO registration under CFTC Regulation 4.5 or an exemption from CTA registration under 4.14(a)(8) (collectively, exemption) to annually affirm the applicable notice of exemption within 60 days of the calendar year end. Persons that fail to file the affirmation notice by March 1, 2021, will be deemed to have requested a withdrawal of the exemption and, therefore, may be required to be registered and NFA Members.
/bit.ly/3oXOllM

Biden Is Expected to Pick Rohit Chopra to Lead Consumer-Finance Agency
Chopra is the former student-loan watchdog at the Consumer Financial Protection Bureau
Andrew Ackerman, Andrew Restuccia, and Ken Thomas – WSJ
President-elect Joe Biden is expected to nominate Rohit Chopra, the former student-loan watchdog at the Consumer Financial Protection Bureau, to lead the agency, according to people familiar with the matter.
/on.wsj.com/3qvyUBr

ESAs publish final draft ITS on reporting templates for intra-group transactions and risk concentration under FICOD
ESMA
The European Supervisory Authorities – ESAs (the European Banking Authority, the European Insurance and Occupational Pensions Authority and the European Securities and Markets Authority) submitted today to the European Commission the final Report on the draft Implementing Technical Standards (ITS) under the Financial Conglomerates Directive (FICOD) on reporting templates for intra-group transactions (IGT) and risk concentration (RC). The draft ITS aim at further increasing comparability amongst conglomerates of different EU Member States thereby improving supervisory consistency.
/bit.ly/39KyccH

2020 FINRA Small Firm Virtual Conference On-Demand Sessions
FINRA
This one-day conference was held online on October 28, 2020, and focused on effective practices and tips for complying with FINRA rules — from the unique perspective of small firms.
/bit.ly/39FA1I5

What’s Happening from Start-Up to Small Cap: SEC’s Small Business Advocate to Host Capital Call Feb. 4
SEC
The Securities and Exchange Commission’s Office of the Advocate for Small Business Capital Formation will host its second annual Capital Call on Feb. 4, 2020, at 1 p.m. ET, where the office will talk about what’s happening with capital raising from startup to small cap. The Capital Call is styled after public companies’ earnings release calls and will include discussion and an opportunity to ask questions about the office’s recent Annual Report to Congress and the Commission. During the virtual event, office staff members will discuss what has been happening with capital raising across the country, including a spotlight on the impacts of the COVID-19 pandemic, the unique challenges faced by underrepresented businesses, the office’s work in supporting small businesses and their investors, and the policy recommendations the office has developed in response.
/bit.ly/2LBIJPI

Statement on FINRA’s Corporate Bond New Issue Reference Data Proposal, by Acting Chairman Elad L. Roisman
SEC
A foundational aspect of a fair, orderly, and efficient market is that all market participants have access to the basic reference data necessary to identify, value, and trade available securities and settle effectuated transactions. In many securities markets, the ability to obtain reference data is taken for granted. But, in the corporate bond market, where thousands of new issues come to market each year, many market participants do not have access to such information at the time a new issue begins secondary trading. Market participants that lack access to this data are hindered from timely participation, not only placing them at a competitive disadvantage but also adversely impacting liquidity in the particular bond issue on the first day the bond trades. Clearly, there is a need for basic reference data on new corporate bond issues to be impartially available to all market participants in a timely manner.
/bit.ly/35RLe7k

Concurrence in the Matter of Wireline, Inc.
Commissioner Hester Peirce – SEC
I support most of the Commission’s settled enforcement action against Wireline, Inc., but write to highlight a concern about the settlement. Wireline offered and sold digital assets using a Simple Agreement for Future Tokens (“SAFT”), pursuant to which purchasers invested money in exchange for the receipt of the tokens to be issued when the Wireline microservices platform went live in the future. These tokens, which never were issued because the platform is not yet operational, were to be the platform’s currency. The SAFTs were explicitly sold as part of a securities transaction. Wireline did not, however, register the offers and sales or qualify for an exemption from registration. Moreover, in the course of selling these investment contracts, Wireline materially misrepresented key facts about the state of the platform’s development. These violations form the basis for the enforcement action, which I support. However, by including a provision whereby Wireline will not distribute the tokens pursuant to the SAFTs, this settlement perpetuates an approach that suggests that tokens themselves are securities and thus complicates the development of crypto networks.
/bit.ly/3bR2MV4

Statement on Chief Economist S.P. Kothari Concluding His Tenure at SEC
Commissioner Elad L. Roisman – SEC
My sincere thanks go to Dr. S.P. Kothari for his incredible work as Chief Economist of the SEC. Under Dr. Kothari’s leadership, the agency’s Division of Economic and Risk Analysis provided invaluable economic analysis to the Commission and its staff on rulemakings, examinations, and enforcement matters. Dr. Kothari also played a key role in the Commission’s efforts to monitor the markets for the unfolding effects of Covid-19 and related government responses. I will truly miss Dr. Kothari’s uncommonly broad perspective on global economic issues, his deep expertise in so many aspects of our markets, and his talent for thoughtfully and candidly explaining all this practical insight to the rest of us.
/bit.ly/35OXSDY

Statement on SEC General Counsel Bob Stebbins Concluding His Tenure
Commissioner Elad L. Roisman – SEC
Since I arrived at the SEC, Bob Stebbins has made himself available to discuss any question I might have relating to the agency’s mission, rulemaking agenda, or operational structure. He has led our Office of the General Counsel in advising on almost everything this agency does. He and the dedicated and expert lawyers in the General Counsel’s office have been instrumental in our rulemaking and policy decisions and have ensured that we have followed the law and furthered our mission. Bob has brought not only sound legal advice to the issues we confront, but also a healthy dose of common sense. My sincere thanks go to him, and his talent, dedication, good nature, and wise counsel will be missed.
/bit.ly/3bQvVzG

FCA clamps down on consumer investment harm
UK FCA
In a report issued today the Financial Conduct Authority (FCA) highlights the many ways in which it works to protect consumers from investment harm by stopping and disrupting potentially harmful firms and activities. The report focuses on action taken by the FCA during the first ten months of 2020, when many consumers found their finances under pressure as a result of coronavirus lockdowns and restrictions.
/bit.ly/39LU5IG

FCA reminds firms to regularly review regulatory permissions
UK FCA
We are reminding firms of their obligation to regularly review regulatory permissions to ensure they are up to date and removed where they are not needed. We expect firms to notify us of material changes and apply to make any necessary changes in a timely way. Please note that we have the power to cancel a firm’s Part 4A permission if it has not carried on a regulated activity for at least 12 months.
/bit.ly/3qvINz3

Jumbo Goldman 1MDB fine upends 2020 trend to lower losses; Financial fraud and fat fingers loom large, but annual top 10 op risk losses still show fewer fails. Data by ORX News
ORX News
Ask any op risk manager to imagine the perfect storm for fomenting loss and they might well describe the scene for 2020. Many feared the pandemic, which forced employees to up sticks overnight and work from home indefinitely, would stir up a squall of problems, such as money laundering, fraud and cyber attacks for their op risk profiles.
/bit.ly/2Nhl4ED

Investing and Trading

There’s a Global Wall of Cash Primed to Snap Up U.S. Treasuries
Liz McCormick, Chikako Mogi, and John Ainger – Bloomberg
Yields seen near a peak amid doubts about economic outlook; Japanese buyers not seen lured until 10-year notes get to 1.3%
The Treasury market’s bears had better take notice: There’s a wall of global cash poised to swoop in and buy, likely limiting the upside in yields. The prospect of a unified Democratic government has jump-started inflation expectations, catapulting long-term Treasury yields back to heights last seen in March 2020 — and approaching levels where many international investors say they’d look to buy.
/bloom.bg/35MrvWI

The Rich Are Minting Money in the Pandemic Like Never Before
Davide Scigliuzzo – Bloomberg
Country’s most well-off benefit from Federal Reserve policies; Access to financial markets shape nation’s unequal recovery
Americans have become, by some measures, richer during the pandemic than ever before. It’s a difficult thing to fathom, what with the economic collapse and the surge in the ranks of the jobless, the homeless and the hungry. But there’s a whole class of people — at least the top 20% or so of earners — who’ve had to worry little about such matters.
/bloom.bg/39FlfAX

Don’t Think About Pink Elephants or Tighter Monetary Policy; Federal Reserve Chief Jerome Powell says it’s too soon to raise rates or reduce bond-buying
Peter Coy – Bloomberg
“There really aren’t any hawks left on the FOMC,” only doves of different degrees, JPMorgan Chase & Co. Chief U.S. Economist Michael Feroli wrote to clients on Jan. 14, referring to the Federal Reserve’s Federal Open Market Committee. “Monetary accommodation” today is “far greater” than in past decades when the unemployment rate was as low as it is now—6.7% in December—Jim Paulsen, chief investment strategist of the Leuthold Group, wrote Jan. 14.
/bloom.bg/3nMbN41

How Joe Biden’s stimulus plan shook up global financial markets; Democratic party’s Senate wins boost everything from small-caps to copper while Treasuries sink
Eric Platt and Colby Smith – FT
The “blue wave” hit later than expected, but with enough strength to force a reordering of global financial markets. Victories in US Senate run-off elections in Georgia held on January 5, which handed the Democratic party control of Congress to add to the presidency, jolted investors into overhauling their portfolios in anticipation of the beefed-up fiscal stimulus promised by US president-elect Joe Biden — who detailed his $1.9tn plan on Thursday.
/on.ft.com/35RAbuS

Jenga-like structure builds in credit markets; Investor optimism priced into bonds contingent on central bank support
Joe Rennison – FT
For one influential watcher of the credit world, conditions in the corporate bond market are starting to look unnerving. Matt Mish, who heads up UBS’s credit strategy team, likens the current state of the market to a tower of Jenga blocks. At the moment, crucial support is being provided by central bank buying across the globe, holding borrowing costs low and providing a backstop if investor demand falls. As that support is removed, piece by piece, the tower could begin to wobble.
/on.ft.com/39JNHlg

Environmental, Social and Corporate Governance

Global Methane Emissions Equaled Europe’s Carbon Footprint in 2020; Methane leaks from oil and gas operations fell 10% from 2019 as production dropped
Laura Millan Lombrana – Bloomberg
Emissions of planet-warming methane fell last year as oil and gas production declined, but they were still equivalent to the European Union’s total carbon dioxide emissions.
/bloom.bg/38YMRCh

Sustainable ETF assets jump but most funds fall short on UN goals; New tool developed with Unctad aims to counter practice of ‘green washing’
Emma Boyde – FT
Assets in exchange traded funds that claim to invest according to environmental, social and governance principles recorded exponential growth in 2020, but only a fraction of those ETFs were aligned with sustainable development goals developed by the UN, research shows.
/on.ft.com/3bPY89F

EU rules promise to reshape opaque world of sustainable investment; Landmark regulations will force asset managers to up their game on ESG but data gaps may hinder progress
Siobhan Riding – FT
Anders Bertramsen likes to know what he is eating so when he does his weekly shop he checks food labels for nutrients and provenance before choosing products. But in his professional role selecting sustainable investment funds for wealthy investors, he finds it much harder to make such judgment calls.
/on.ft.com/39JOVNo

ESG accounting needs to cut through the greenwash
Karthik Ramanna – FT
For investors seeking more focus on environmental, social, and governance issues, 2020 might have felt like a good year as numerous CEOs embraced ‘ESG-speak’. But much of this, I suspect, was to dress up the disappointment of Covid-19-induced losses. And their posturing only seemed real because accountants and standard setters got in on the act. Before investors take any ESG claims seriously, though, the accounting has to become a lot more serious. That means incorporating the features of high-quality accounting rules — and here are three that I believe could make a difference.
on.ft.com/2XRY0yg

Institutions

Citi’s Bond Trading Misses Estimates as 2020’s Surge Weakens
Jennifer Surane – Bloomberg
Bank releases $1.5 billion from its reserves for loan losses; Revenue jumped 57% in recently revamped stock trading unit
Citigroup Inc.’s fixed-income traders — who propped up the bank’s earnings through much of the pandemic — missed analysts’ estimates for the final months of 2020, a sign that a wave of investor activity might not last as long as expected. Revenue from trading bonds, currencies and commodities rose 7% in the fourth quarter compared with a year earlier, the smallest jump since the Covid-19 virus began rattling markets. The $3.09 billion generated by the business was shy of the $3.2 billion analysts projected.
/bloom.bg/2XIUeXQ

Edmond de Rothschild Holding’s Chairman Dies at 57
Blaise Robinson and Jeff Black – Bloomberg
Benjamin De Rothschild had been head of the group since 1997; The Rothschilds were once one of the world’s richest families
Benjamin de Rothschild, chairman of Edmond de Rothschild Holding SA, who helped take the bank private in 2019, has died at 57. “It is with deep regret and great sadness that Edmond de Rothschild Group announces the passing of Benjamin de Rothschild following a heart attack at his home in Pregny, Switzerland,” the company said Saturday in a statement.
/bloom.bg/3iiyiMA

Blankfein Called It, Now the Whole World Is Watching Commodities
Isis Almeida, Michael Tobin, Andres Guerra Luz, and Michael Roschnotti – Bloomberg
In September, ex-Goldman CEO suggested investing in materials; Over $30 billion have been added to bullish wagers since then
It was mid-September when Lloyd Blankfein, the former chief executive officer of Goldman Sachs Group Inc., suggested investing in commodities was “not a bad thing.” Prices for most materials were just off pandemic lows and the asset class was still very much the ugly duckling.
/bloom.bg/2KlLOCF

Credit Suisse Hires for New Stock Underwriting Team in Japan
Takashi Nakamichi and Takako Taniguchi – Bloomberg
Tatsuya Watanabe joined from UBS to help lead the team; Swiss bank has also been recruiting equity analysts in Tokyo
Credit Suisse Group AG hired Tatsuya Watanabe from UBS Group AG to help lead a new stock-underwriting team in Japan, the latest sign of its renewed interest in the nation’s share market.
/bloom.bg/2Kq17dz

Franklin Templeton Is Betting on Europe’s High-Yield Bank Bonds
Priscila Azevedo Rocha – Bloomberg
$1.5 trillion investor sees double-B debt a ‘good place to be’; Plans to take advantage of likely market volatility this year
Franklin Templeton is betting on a rally in financial and industrial bonds in Europe, as it seeks out returns amid ever-tightening credit spreads. The $1.5 trillion asset manager is overweight in both sectors amid confidence that the European Central Bank will keep supporting lenders and that the economy will bounce back from a coronavirus slump, said David Zahn, its head of European fixed income. Double-B and other high-yield bonds are a particular focus.
/bloom.bg/3oQSpnE

Rethinking equities at Cantor Fitzgerald Europe; Following growth in US operations over the past few years, head of European equities at Cantor Fitzgerald, Talat Khan, tells Hayley McDowell that adding new talent in 2020 has helped bolster the bank’s position in the market.
Hayley McDowell – The Trade
When former Goldman Sachs managing director Talat Khan joined Cantor Fitzgerald in April 2019, the boutique investment bank had major plans to expand its equities and investment banking businesses across Europe.
/bit.ly/3sASRJ3

Regions

Russia Prepares Earliest-Ever Arctic LNG Shipment to Asia
Irina Reznik, Anna Shiryaevskaya, and Dina Khrennikova – Bloomberg
LNG cargo from Yamal to use normally frozen Northern Sea Route; Longer shipping Arctic seasons show impact of climate change
Russia is preparing to make the earliest-ever shipment of liquefied natural gas to Asia, taking advantage of thinning ice in the Arctic Ocean and paving the way for a record-long navigation season this year.
/bloom.bg/3oWLUj9

More Traders Likely Face Charges in Danish Tax Investigations
Frances Schwartzkopff – Bloomberg
Danish prosecutor comments days after first charges filed; Prosecutor calls Cum-Ex most complicated tax case in history
Danish prosecutors who charged hedge-fund manager Sanjay Shah with running a $1.6 billion tax fraud say they’re looking at a “number of other suspects” in the case. Prosecutors said they’ll be in a position by March to decide whether to press charges against more members of a network that they say was set up to defraud the government in the biggest and most complex tax case in history.
/bloom.bg/2LYB3a3

ECB threatens banks with capital ‘add-ons’ over leveraged loan risks; Policymakers frustrated by some lenders’ lack of action to tighten controls
Stephen Morris and Robert Smith and Martin Arnold – FT
The European Central Bank is threatening to impose additional capital requirements on banks that continue to ignore requests to rein in risk in the booming leveraged loan market.
/on.ft.com/2KoAuFR

Why banks should not bear all the burden of Britain’s scam culture; The cost of soaring online fraud should be shared by other companies
Patrick Jenkins – FT
“NHS: We have identified that you are eligible to apply for your vaccine: for more information, and to apply, follow here: uk-application-form.com.”
/on.ft.com/2LWFceu

Brexit

Brexit Finance Talks Get Technical With Broader Progress Elusive
Harry Wilson – Bloomberg
Talks around regulatory cooperation started last week; Separate breakthrough on market access remains remote prospect
As with many meetings these days, the U.K. and EU’s latest negotiations on financial services began with a video conference call Friday. Unlike the high-profile gatherings that kicked off the earlier trade deal, the opening discussions on how to regulate the trillions of dollars of cross-border financial flows were a low-key affair.
/bloom.bg/38RCK1Y

City of London bosses warn against post-Brexit deregulation; Business chiefs say there is little need for wholesale rule changes in the UK
Daniel Thomas – FT
City of London bosses have urged the UK government to tread carefully after it promised sweeping post-Brexit deregulation, arguing that the focus instead should be on creating new flexible rules to support growing areas of the economy.
/on.ft.com/2LVA8XL

Sadiq Khan: Financial services have been badly let down by Brexit; The needs of a sector central to the UK’s competitiveness have been overlooked by the government
Sadiq Khan – FT
People who work in the UK’s financial services once believed that they could bank on a Conservative government. But they have been well and truly abandoned by the current one at the worst possible time.
/on.ft.com/3nVkhG7

London Finance Vacancies Fell 49% in 2020 on Brexit, Covid Angst
Viren Vaghela – Bloomberg
Job openings in London’s finance industry almost halved in 2020 as the uncertainties of coronavirus and Brexit discouraged hiring. City firms advertised 16,335 new roles last year, a drop of 49% on the prior year and the lowest since at least 2015, according to data from recruitment firm Morgan McKinley published Monday. “Brexit on its own would have been hard enough,” said Hakan Enver, managing director at Morgan McKinley’s U.K. business. “However, the City had to deal with the disruption of the global pandemic and the potential upheaval of the change of leadership in the U.S.”
bloom.bg/3qvCgVg

Miscellaneous

Penn Station’s Revival Gets a $1.6 Billion Down Payment; The new Moynihan Train Hall is a light-drenched effort to recapture the glory of a lost architectural masterpiece. It doesn’t fully succeed — but it’s a good start.
James S. Russell – Bloomberg
The newly opened Moynihan Train Hall at New York Penn Station, America’s busiest rail hub, is the culmination of a vision that New York Senator Daniel Patrick Moynihan first promoted in the early 1990s. Moynihan, a champion of civic-minded federal architecture, proposed converting a portion of the Farley Post Office building to expand the crowded and much-unloved Penn Station facilities underneath Madison Square Garden. That scheme was repeatedly delayed, but on January 1, 2021, the result of those efforts – a $1.6 billion train hall designed by architectural firm Skidmore, Owings & Merrill (SOM) – welcomed its first passengers.
/bloom.bg/3qAyCcN

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