CBOE delays reopening of trading floor after widespread disruption in the Loop

Jun 4, 2020

First Read

Vendors, the Virus and Volatility
By Sarah Rudolph – JLN

How are software vendors managing their businesses in the current pandemic environment? A group of some of the top vendors answered that question Wednesday in a webinar called “Vendors vs. Virus” hosted by Imagineer Technology Group.

Their clients are investment managers – hedge funds, mutual funds, and prop trading firms – and without the vendors’ platforms and services they can’t do what they do, said Jeremie Bacon, the CEO of Imagineer and the moderator of the webinar.

Because these vendors were already primarily digital companies, they mostly found the transition to communicating electronically to be a smooth one. Rick Lane, CEO of Trading Technologies, said feedback from staff was “overwhelmingly positive” two to three weeks into the pandemic; employees said meetings had become more efficient.

“Generationally,” he said, “more and more of the workforce is comfortable with virtual and technological tools. TT has so far allowed anyone who wants to to work from home – they plan to evaluate how that is going in two or three months.

“People are really enjoying working from home,” he said. “But they would like the ability to show up at the office from time to time.”

To read the rest of this story, go here.


Hits & Takes
By John Lothian

The FIA has announced a virtual IDX program for later in June. Here is the program. There were no intermissions mentioned for trips to the pub “The Jugged Hare,” for some reason.

The FIA is holding a survey to gauge industry sentiment on the impact of the pandemic on the global derivatives markets. The survey consists of 15 questions; however it is only for FIA members, so look in your inboxes for the link.

Anna Watson, former head of communications at the World Federation of Exchanges, has gone all entrepreneur on us and opened Watson Wordsmith, her one stop shop to help agencies and corporates in three key areas: copy, content, and consulting.

Taraneh Derayati has been named chief executive officer at Vermiculus Financial Technology. Derayati is the former head of sales at Cinnober. Vermiculus is a new sponsor of JLN and the latest enterprise of Nils-Robert Persson

Graeme Neilly has left Trading Technologies and joined Phillip Capital UK as head of DMA sales.

Stephanie Dobbs Brown has been promoted to vice president of marketing at Intercontinental Exchange.

Wedbush’s Bob Fitzsimmons went all Larry King with the Small Exchange’s Donnie Roberts in a video interview about the new exchange and its prospects.

CFTC Chairman Heath Tarbert has used his time at home to grow one awesome beard as seen here in this interview with CNBC’s Bob Pisani.

Have you paid for your 2020 JLN subscription? Today would be a good day to do so if you have not. You can pay online right here.

Did you know that if your firm is an Enterprise Subscriber to the John Lothian Newsletter, which means you have paid for five or more subscribers, you get one free Special Report to the readership of the John Lothian Newsletter that year?

Stay Safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL


FIA Announces Virtual IDX; International Derivatives Expo; Virtual programming on key issues impacting the cleared derivatives industry
23 June 2020 – 25 June 2020 • 2:00 PM – 4:00 PM BST Daily
As we deal with the current uncertainties shaping the cleared derivatives markets, FIA is bringing you virtual programming over 3 days to examine these changing landscapes and identify opportunities for moving forward. Join from anywhere in the world to hear industry experts and leaders debate the importance of markets during this critical time globally and share insight on lessons learned from the current environment. Space is limited – sign up now to guarantee your spot in IDX-V.

*****I will be making a virtual appearance at IDX. Really.~JJL


CTFC approval! Six more Eurex ESG futures now tradable in the U.S.
Six new Eurex equity index futures on ESG indices have received approval from the U.S. Commodities Futures Trading Commission (CFTC). This regulatory permission opens the U.S. market – both buy side and sell side – allowing the new ESG derivatives to be utilized by U.S.-based investors that apply ESG criteria to their portfolios.

***** Do well by doing good, the good Doc Sandor would always say. Trading ESG has good written all over it.~JJL


Goldman Sachs Establishes Fund for Racial Equity; $10 Million to Be Deployed to Help Address Racial and Economic Injustice
Goldman Sachs
Goldman Sachs today announced it has created the Goldman Sachs Fund for Racial Equity to support the vital work of leading organizations addressing racial injustice, structural inequity and economic disparity. The fund will be launched with $10 million from Goldman Sachs Gives, a donor-advised fund that allows the firm and its current and retired senior employees to direct grants to support underserved communities around the world.

*****A good step by Goldman. Who else is in?~JJL


NBA set to resume season with 22 teams — all games will be played at Disney World
Weston Blasi – MarketWatch
The NBA is back.
League owners and the National Basketball Players Association are expected to approve a season restart plan that would invite 22 teams to Orlando, Fla., according to ESPN’s Adrian Wojnarowski All 22 teams coming to the ESPN Wide World of Sports complex on the Disney campus near Orlando would play eight games to determine playoff seeding before the playoffs begins. Games will most likely resume on July 31, according to The Athletic’s Shams Charania.

*****The playoffs are officially a fantasy. But my question is what are they going to ask the MVP of the finals? He will already be at Disney World.~JJL


Florida offers drive-through Botox to quarantined residents
Zachary Fagenson – Reuters
Quarantined Florida residents worried about their laughter lines and crows’ feet need frown no longer – Botox is back, and it’s being offered at a drive-through.

**** Never change, America. ~JB



Wednesday’s Top Three
Our top story Wednesday was the Financial Times’ The women shaking up wealth management, profiling three female leaders in the field. Second was a top three repeat from Tuesday, George F. Will’s Washington Post column, Trump Must Be Removed. So Must His Congressional Enablers. Third was JLN’s Suzanne Cosgrove’s article, Exchange Leaders Take Stock Of Covid-19 Volatility.


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Lead Stories

CBOE delays reopening of trading floor after widespread disruption in the Loop
Robert Channick – Chicago Tribune
The CBOE, one of the world’s largest options exchanges, is pushing back the reopening of its Chicago trading floor by a week amid downtown disruption. The trading floor, which has been closed since mid-March because of the coronavirus pandemic, is scheduled to reopen June 15 as the city deals with fallout over the death of George Floyd at the hands of Minneapolis police.

The Small Exchange Secures $4 Million From Interactive Brokers and Phillip Capital; New Exchange Provides Futures Products and Will Offer Options to Global Brokerage Firms
Business Wire
The Small Exchange, a new futures exchange offering smaller, simpler products aimed toward retail customers, today announced securing $4 million in investment from Interactive Brokers (Nasdaq: IBKR) an automated global electronic broker, and Phillip Capital Group, a global financial services firm. As strategic partners, both firms will be key participants on the Small Exchange.

China’s Street Vendors Serve Up Stock Bubbles, Piping Hot; During a gold rush, sell shovels. During a street food binge, buy griddles
Jacky Wong – WSJ
China is turning to its street vendors to help reboot the economy after the coronavirus. This may or may not create many jobs—but it has already brought big bucks for punters. Premier Li Keqiang, in particular, has been flagging street vendors as part of the post-coronavirus economic plan. “The street-stall economy and small-shop economy are an important source of jobs, ” he said during a trip Monday, according to state media. “They are as vital to China as bigger and more high-end businesses.”

Wall Street Firm Will Pay Junior Bankers Not to Work; Evercore Partners is offering to pay incoming junior bankers up to $25,000 to delay starting their jobs during the coronavirus pandemic
Liz Hoffman – WSJ
Evercore Partners Inc. is offering to pay incoming junior bankers up to $25,000 to delay starting their jobs during the coronavirus pandemic, according to external recruiters, a move that hasn’t been seen on Wall Street since the last financial crisis. Recent college graduates who were due to start at Evercore later this summer will get $15,000 if they defer their start date until January and $25,000 if they wait until next summer to join, said recruiters who are in touch with incoming employees. A spokesman for Evercore declined to comment.

Trump Taps SEC’s Peirce for Second Term at Agency
Bloomberg Law
Republican SEC Commissioner Hester Peirce could have at least five more years at the agency, if the Senate backs her. President Donald Trump nominated Peirce for a second term at the Securities and Exchange Commission Tuesday, according to the White House. Her current term is scheduled to expire June 5, but can continue for about 18 more months while senators review her nomination.

Singapore Exchange Shares Drop Most Since 2003 On end Of MSCI Licence – FTSE Mondo Visione Exchanges Index Up By 6.7% In May
The stock price of the Singapore Exchange plunged on Wednesday 27th May after MSCI announced that it had signed a licensing agreement with Hong Kong Futures Exchange, a subsidiary of Hong Kong Exchanges and Clearing, to introduce 37 futures and options contracts. MSCI also announced that it intended to continue to license the MSCI Singapore Index to the Singapore Exchange for a listed futures contract, in addition to allowing HKEX to list a contract on the index. The license to SGX for all other MSCI indexes will expire in early 2021. Singapore Exchange shares fell 7% on 28th May, extending the previous day’s 11.6% slump – the biggest in over 16 years.

CFTC Chairman on the investing landscape in 2020 versus 2008 financial crisis
CNBC’s Bob Pisani chats with CFTC Chairman Heath Tarbert about investing during a global pandemic and how that compares to the 2008 financial crisis – what regulators learned and how they’re dealing with it.

Cboe Delays Trading Floor Reopening by a Week Amid Unrest
Tony Owusu – The Street
The CBOE Global Market (CBOE) in Chicago announced postponed reopening its options-exchange trading floor until June 15 in the wake of the civil unrest and curfews in the city. The trading floor had been scheduled to open on Monday, June 8. The delay is due to “closures across the city of Chicago and limited access to the area surrounding the CBOE building,” the company said in a statement. The owner of the exchange says that it is continuing to monitor the situation.

Jump Trading joins SIX Swiss Exchange as trading participant; SIX Swiss Exchange has onboarded Jump Trading Europe as its first new trading member this year.
Kiays Khalil – The Trade
SIX Group has confirmed that Jump Trading Europe has joined the Swiss Stock Exchange as its first new trading member in 2020. Jump Trading joins a pool of 94 participants currently trading on the exchange, including major institutions such as Goldman Sachs, JP Morgan, Citi and Credit Suisse. Following its onboarding, the high frequency trading firm will have access to SIX’s technological trading infrastructure, as well as its order book.

Chicken Industry Executives, Including Pilgrim’s Pride CEO, Indicted on Price-Fixing Charges; Indictment alleges current and former senior executives at Pilgrim’s and Claxton Poultry Farms fixed prices and rigged bids from 2012 to 2017
Brent Kendall and Jacob Bunge – WSJ
The chief executive of one of the country’s biggest chicken producers and three other industry executives were indicted Wednesday on charges they conspired to fix prices on chicken sold to restaurants and grocery stores, the Justice Department’s first charges in a continuing criminal antitrust probe.

If It’s Illegal, ‘Don’t Tell Me’: Chicken Probe Ensnares a CEO
Lydia Mulvany, Michael Hirtzer, David McLaughlin, and Isis Almeida – Bloomberg
Texts reveal price talk between Pilgrim’s Pride and rivals; Claxton Poultry Farms executives were also charged in case
Toward the end of every year, chicken producers compete for massive contracts with grocery stores and fast-food chains across America. At least, that’s how it’s supposed to work.

BGC Partners – Capitalab connects to LCH SwapAgent to Enhance Margin Optimisation Services
BGC Partners
Capitalab, a division of BGC Brokers LP, an entity within BGC Partners, Inc. (NASDAQ: BGCP), today announced the execution and subsequent compression of Capitalab’s first swaption margin optimisation trades leveraging LCH SwapAgent, a service for the non-cleared derivatives market. As part of Capitalab’s leading Rates Initial Margin Optimisation service, swaption notional was created between Nomura and Deutsche Bank and processed by LCH SwapAgent.

Exclusive: Ex-Enron CEO Skilling launching new digital marketplace for oil investors – sources
Liz Hampton – Reuters
Former Enron CEO Jeffrey Skilling, released last year after a 14-year prison term stemming from the energy firm’s collapse, is raising funds to launch a digital marketplace catering to professional oil and gas investors, according to four people familiar with the matter.


Rethinking Air Pollution After the Virus; Studies are starting to link dirty air to Covid deaths.
Bloomberg News
Some of the most powerful images that circulated around the world as a result of Covid-19 lockdowns were of the unsullied blue skies.

Coronavirus Pandemic Drives Unemployment Up Across U.S. Metro Areas; Business shutdowns triggered by Covid-19 in April hit hardest tourist destinations and factory towns
Eric Morath – WSJ
The coronavirus pandemic caused unemployment to rise in every metropolitan area in the U.S. in April, the first full month of widespread stay-at-home orders and business shutdowns, hitting hardest tourist destinations and factory towns.

PwC to reopen six offices to employees next week; The chair of PwC Kevin Ellis said the firm can safely accommodate 15% of its 22,000 employees in the office
Emily Horton – Financial News
PwC will reopen its offices in London, Birmingham, Manchester, Leeds, Reading and Bristol on Monday, as Covid-19 lockdown measures relax. The Big Four accounting firm said in a statement on 3 June that it would reopen these six UK offices with “reduced occupancy” from 8 June. Kevin Ellis, PwC’s UK chair, said the group can safely accommodate 15% of its employees in its offices. In theory, this would amount to around 3,300 of its 22,000 staff in the UK.

Citi defies coronavirus with Western European corporate lending push
Sinead Cruise, Lawrence White – Reuters
Citigroup (C.N) is looking to ramp up its commercial banking operations across Europe, Middle East and Africa, plugging gaps left by rivals facing fallout from a coronavirus-induced recession.

World food price index hits 17-month low in May: U.N.
World food prices fell for a fourth consecutive month in May, hit by the economic fallout of the coronavirus pandemic which has stymied demand, the United Nations food agency said on Thursday.

America’s Safety Net Is Failing Its Workers; Stories from a country that was wildly unprepared for a pandemic.
Claire Suddath – Bloomberg
Chrissy Ormond De Swardt was having a cookout when she learned she’d lost her job. She and her husband, Bennie De Swardt, had spent the first week of March in Indian Wells, Calif., setting up for the BNP Paribas Open, a two-week tennis tournament expected to draw half a million spectators. Chrissy works in event production, overseeing players’ walk-out routines, award presentations, and other minutiae. Bennie, a camera operator and supervisor, makes sure the matches look good on TV.

Malaysia Coronavirus Cases Rise by Most Since Pandemic Began
Yudith Ho – Bloomberg
Malaysia added 277 new cases, mostly from immigration depots; Government is set to lift its lockdown measures on June 9
Malaysia saw the biggest daily increase in new coronavirus cases since the pandemic started. The country added 277 new cases on Thursday, of which 270 were found in immigration detention centers, according to the health ministry. That brings the total to 8,247 with 115 deaths.

Exchanges, OTC and Clearing

Nasdaq Ventures Invests in Automated Financial Crime Investigations Firm Caspian – Investment bolsters Nasdaq Ventures portfolio of tech innovators; Caspian to expand AML offerings in partnership with Nasdaq
Nasdaq (Nasdaq: NDAQ) announced today that its investment arm, Nasdaq Ventures, has taken a minority stake in the UK-based financial crime investigation automation company Caspian. In addition, Nasdaq’s Market Technology business has forged a partnership with Caspian to support the growth of the business within the Financial Crime business verticals.

CME Group Chairman and Chief Executive Officer and Chief Financial Officer to Present at Piper Sandler Global Exchange & FinTech Virtual Conference
CME Group
CME Group announced today that Terry Duffy, Chairman and Chief Executive Officer, and John Pietrowicz, Chief Financial Officer, will present at the Piper Sandler Global Exchange & FinTech Virtual Conference on Thursday, June 4, at 11:00 a.m. (Eastern Time).

FTSE Straits Times Index (STI) quarterly review – June 2020; One change to the constituents of the STI
FTSE Russell announces that there will be one change to the constituents of the Straits Times Index (STI), following the June 2020 quarterly review. Mapletree Industrial Trust has been added to the STI. As a result, Singapore Press Holdings has been removed from the index.

TMX Group Consolidated Trading Statistics – May 2020
TMX Group Limited today announced May 2020 trading statistics for its marketplaces – Toronto Stock Exchange, TSX Venture Exchange, TSX Alpha Exchange and Montréal Exchange.

ASX Monthly Activity Report – May 2020

MSCI Mexico and MSCI South Africa index futures: Withdrawal of availability for trading for U.S. Participants
With effect from 22 June 2020, tradability of MSCI Mexico Index Futures (Eurex product code: FMMX) and MSCI South Africa Index Futures (Eurex product code: FMZA) will be withdrawn for U.S. Eurex Participants and U.S. investors. Background of this measure is that both indices will transition from a non-narrow-based security index to a narrow-based security index.

Taiwan Futures Exchange To Launch FTSE4Good TIP Taiwan ESG Index Futures Contract, The First ESG Futures In Asia
Taiwan Futures Exchange (TAIFEX) has partnered with FTSE Russell and Taiwan Index Plus (TIP) Corporation to list the first futures contract linked to FTSE4Good TIP Taiwan ESG (“F4G TIP TW ESG”) Index on 8 June 2020, catering to the continuously growing market need for ESG (environmental, social and governance) investment in Taiwan.

Shenzhen Stock Exchange Party Committee Faithfully Conveys And Studies The Guiding Principles Of The Two Sessions: Going All Out To Promote Steady Implementation Of Reforms In Key Areas
On June 1, the CPC SZSE Committee held the (enlarged) meeting of the CPC SZSE Committee, which faithfully conveyed and studied the guiding principles of General Secretary Xi Jinping’s speeches during the Two Sessions and of the Two Sessions and laid down arrangements for implementing relevant work. SZSE leadership members and persons in charge of SZSE departments and subordinate companies attended the meeting.

Shenzhen Stock Exchange And The Ministry Of Natural Resources Hold The Online Roadshows And Training Activities For Investment In And Financing For Maritime SMEs
SZSE and the Ministry of Natural Resources of the People’s Republic of China held the “Online Roadshows and Training Activities for Investment in and Financing for Maritime SMEs” recently. As a specific measure to earnestly implement the decisions and arrangements of the CPC Central Committee and the State Council on developing maritime economy and facilitate the performance of the Strategic Cooperation Framework Agreement on Promoting High-quality Development of Maritime Economy signed by the two sides, the campaign aims to further assist maritime small and medium-sized enterprises (SMEs) in resuming production and reaching production capacity and expand financing channels for maritime industry.

SIX Extends DocHub Platform Reach Through Finnova
SIX, the Swiss financial data expert, announces that DocHub, the Regulatory Document Hub from SIX, is available as of today to the wider Swiss financial market through Finnova, a leading Swiss provider of software and services.

Vienna Stock Exchange: Equity Turnover In May 2020
The Vienna Stock Exchange records equity trading volumes of EUR 5.15 billion in May 2020. Year-to-date the equity turnover amounts to EUR 32.03 billion. This is a gain of 21.4% over the same period last year (Jan-May 2019: EUR 26.38 billion).

Cboe Global Markets Reports May 2020 Trading Volume
Cboe Global Markets
Options ADV up 18 percent over May 2019; U.S. Equities ADV up 66 percent over May 2019; Cboe EDGX Options Exchange monthly ADV of more than one million contracts a new all-time high
Cboe Global Markets, Inc. (Cboe: CBOE), one of the world’s largest exchange holding companies, today reported May monthly trading volume.


ChartIQ Tightens Charting & Finsemble Integration, Readies Rebrand; Having developed two separate product lines to showcase its charting and smart desktop integration offerings, ChartIQ is now bringing them closer together to solve client needs.
Max Bowie – Waters Technology
ChartIQ, a provider of HTML charting libraries and the Finsemble desktop integration platform, is embarking on an initiative to further align its two business lines, which will also involve rebranding the company with new name, as yet undisclosed. ChartIQ co-founder and CEO Dan Schleifer says the move is necessary to unite the previously separate areas under a single strategy.

New York, France Sign Fintech Market Entry Agreement
New York’s top financial regulator and its national counterpart in France have signed an agreement to help fintech companies more quickly enter their markets.
The memorandum of understanding allows the two regulators to refer companies to one another for potential market entry and exchange information about regulatory and policy issues, according to a Wednesday announcement. It doesn’t create any binding legal obligations on either regulator.

Yandex, Sberbank Look at Splitting E-Commerce, Fintech Projects
Leading Russian technology company Yandex NV and the country’s largest lender Sberbank PJSC are in talks about restructuring the ownership of their e-commerce and fintech joint ventures, signaling the possible end to their strained relationship.

Fintech in Brief: OCC Issues Final ‘Valid When Made’ Rule on Permissible Interest on Transferred Loan
Nutter McClennen & Fish LLP – JDSupra
On May 29, 2020, the Office of the Comptroller of the Currency (the “OCC”) issued a final rule (the “Rule”) confirming the validity of interest rates on bank loans transferred to third parties, including fintech affiliates.


Amended lawsuit filed against Bitfinex and Tether for allegedly manipulating crypto market, Bittrex and Poloniex added as new defendants
Yogita Khatri – The Block
An amended class-action lawsuit has been filed against Bitfinex, Tether, and affiliated entities for allegedly manipulating the cryptocurrency market. Crypto exchanges Bittrex and Poloniex have been added as new defendants in the updated lawsuit, filed on June 3 in the Southern District Court of New York. The initial lawsuit was filed in October 2019.

Latest Bitcoin Core Code Release Protects Against Nation-State Attacks
William Foxley – Coindesk
The 20th iteration of Bitcoin Core, the open source software powering the Bitcoin blockchain, was released Wednesday. Experimental software called “Asmap” was included to protect against a theoretical “Erebus” attack. An Erebus attack allows nation-states and/or large internet providers such as Amazon Web Services to spy, double-spend or censor bitcoin transactions. The patch would help thwart an attack but is not a conclusive fix.

Japanese Cryptocurrency Exchange Leads National Digital Payments Study
Marie Huillet – Cointelegraph
Crypto exchange DeCurret is leading Japan’s three megabanks in a study group to look into developing a national digital settlement infrastructure. Digital asset exchange DeCurret is leading Japan’s three megabanks in a new study group to look into developing a national digital settlement infrastructure. Convening with the oversight of the central bank and the country’s financial watchdog — the Financial Services Agency (FSA) — Decurret said on June 3 that the group would seek to define a “direction for the realization of valuable digital currencies in Japan.”

Coinsquare hacker reveals cruel plan to now steal Bitcoin
Liam Frost – Decrypt
The individual who stole users’ personal information from Coinsquare plans to use it for SIM swapping attacks. The crypto exchange claimed it knew about the leak a year ago. The hacker stated that he wants to “embarrass” the platform. The individual—or group—who obtained personal information of Canadian crypto exchange Coinsquare’s users intends to use the stolen data to conduct a wave of SIM swapping attacks, according to Vice.

Crypto.com Appoints Antonio Alvarez as Chief Compliance Officer
Crypto.com announced today the appointment of Antonio Alvarez as Chief Compliance Officer. Antonio will be responsible for leading worldwide regulatory compliance across Crypto.com’s entire product ecosystem. Antonio joins the team with over a decade of experience leading compliance programs at various finance companies.

Lack of legal clarity poses investor risks if crypto custodians go bankrupt: study
Saniya More – The Block
There remains a lack of clarity surrounding the legal proceedings and rights of investors if crypto custodians enter a state of insolvency, according to a group of researchers from the Leiden Law School. The researchers — Matthias Haentjens, Tycho de Graaf and Ilya Kokorin — published a study last month entitled “The Failed Hopes of Disintermediation: Crypto-custodian Insolvency, Legal Risks and How to Avoid Them,” where they discussed which rights investors have if a crypto custodian falls insolvent.

Ex-Yang Aide Is Running for Congress with Bitcoin and UBI on His Mind
Benjamin Powers – Coindesk
For would-be U.S. lawmaker Jonathan Herzog, financial exclusion isn’t just a talking point, it’s lived experience. When launching his congressional run, he said, Herzog went to Bank of America and Citibank and tried to open a campaign checking account, but was denied. Herzog saw it as an example of the ways centralized institutions can hold power over people, even someone like him who is privileged. That’s in part why he’s stumping for open, permissionless financial systems as part of his campaign.

‘Careless’ Users Are Ruining Ethereum’s Privacy: Paper
Paddy Baker – Coindesk
Ethereum is losing its privacy, warns a new paper, as “careless” users make linking their addresses to real-world identities easy. With the disquieting title, “Blockchain is Watching You,” the paper – a joint-publication from researchers at the Institute for Computer Science and Control in Hungary, Eötvös Loránd University, Széchenyi István University and HashCloak – argues governments and private-entities are quickly learning how to strip away anonymity from Ethereum. And that’s in part because users are making it easy for them.

Hester Peirce nominated for second term as SEC commissioner: report
Saniya More – The Block
Hester Peirce, a U.S. Securities and Exchange Commission commissioner, has been nominated for another term, according to a Bloomberg report. The outlet said that Peirce had been nominated by a second term by President Donald Trump, citing the White House. Her current term expires on June 5.

Bittrex, Poloniex Named in Bitcoin Price Manipulation Lawsuit
Arnab Shome – Finance Magnates
Another two major cryptocurrency exchanges – Bittrex and Poloniex – have been summoned to the court in connection to their involvement in the Bitcoin price manipulation in the 2017 bull run. The June 3 filings were made by the same plaintiffs who dragged Bitfinex and Tether to court last October for artificially inflating the price of Bitcoin.

Argo’s Mining Revenue Dips After Bitcoin’s Halving
Paddy Baker – Coindesk
London-listed Argo reported a dip in May revenue, possibly as a result of the bitcoin halving event. Per the mining firm’s monthly operational update, monthly mining margins – revenue minus operating costs – was roughly 34% in May, down from 39% in April. Overall, the company mined 252 bitcoin (~$2.4 million at press time), down from 319 bitcoin (~$3 million) the month before. This slight dip in revenue comes straight after the bitcoin halving – which took block rewards down from 12.5 to 6.25 BTC last month. Argo says it was able to mitigate potential disruptions from the halving by investing in “state-of-the-art” mining rigs.


Former Defense Secretary Jim Mattis Says Trump ‘Tries to Divide Us’; ‘Donald Trump is the first president in my lifetime who does not try to unite the American people’
Michael R. Gordon – WSJ
Former Defense Secretary Jim Mattis on Wednesday denounced President Trump for exacerbating the divisions in American society and said that he has fueled the current disorder plaguing U.S. cities.

Mattis says Trump ‘tries to divide us’ in stinging rebuke; Former defence secretary accuses president of making ‘a mockery’ of US constitution
Demetri Sevastopulo and Katrina Manson- FT
Jim Mattis, a retired general and former defence secretary, castigated Donald Trump as an immature president making “a mockery” of the constitution, as he joined a chorus of retired military officers who have slammed the president for his response to the George Floyd protests.

Trump blames ‘Antifa’ for protests despite lack of evidence; Experts say far-left political movement is ‘complete opposite’ of an organised group
Courtney Weaver – FT
As protests over the death of George Floyd turned violent in recent days, Donald Trump and his administration detected the hand of a political organisation that experts say is not really an organisation at all.

Racial Repression Is Built Into the U.S. Economy; One hundred fifty years after the Civil War, the color of money is still white.
Peter Coy
The economics profession has had a hard time getting a fix on racial discrimination. Quite apart from its cruelty, it seems?…?illogical. One of the first lessons in microeconomics is that workers are paid a sum equaling the marginal product of their labor—their value to the enterprise. Any employer who tried to pay them less would lose them to a competitor. Clearly that doesn’t always happen in the real world. For more than half a century, some of the biggest names in economics have wrestled with why, including Nobel laureates Gary Becker, Edmund Phelps, Kenneth Arrow, Joseph Stiglitz, George Akerlof, and Michael Spence. All white men, by the way.

The U.K. Is On a Collision Course With China
Alan Crawford – Bloomberg
Johnson government in talks with Huawei rivals on 5G network; Brexit means that the U.K. is cut loose from Europe on China
The U.K. is heading for a damaging showdown with China as it takes on Beijing over Hong Kong and Huawei Technologies Co.

Biden Widens His Lead Over Trump During Protests, Pandemic
Emma Kinery – Bloomberg
Joe Biden further widened his lead over President Donald Trump as unrest gripped much of the country, up 11 percentage points over the incumbent in the latest Monmouth University poll.

Trudeau’s 21-Second Pause Becomes the Story in Canada; Prime Minister Justin Trudeau struggled to find the words to answer a question about President Trump’s response to the protests roiling the United States.
Catherine Porter – NY Times
When asked what he thought of President Trump’s call for military action against American protesters and the tear gassing of peaceful demonstrators to make way for a photo-op, Prime Minister Justin Trudeau paused at his podium for 21 uncomfortable, televised seconds. He opened his mouth, then shut it — twice. He softly groaned.

Submission from David Solomon to U.S. House of Representatives Subcommittee on Consumer Protection and Financial Institutions Hearing
Goldman Sachs
Promoting Inclusive Lending During the Pandemic: Community Development Financial Institutions and Minority Depository Institutions — Goldman Sachs Chairman and Chief Executive Officer David Solomon’s submission to U.S. House of Representatives Committee on Financial Services Subcommittee on Consumer Protection and Financial Institutions Hearing

From Goldman to Apple, Companies Gauge New Calculus on Race; Corporate America offers policies, protests and cash even if detractors cry hypocrisy.
Jeff Green and Gerald Porter Jr. – Bloomberg
MTV went dark for 8 minutes and 46 seconds. Goldman Sachs pledged $10 million “to help address racial and economic injustice.” And Nike reworked its well-worn slogan for these troubled times: “For Once,” it said, “Don’t Do It.”


Recent changes to NFA’s Self-Examination Questionnaire
On an annual basis, NFA Member FCMs, RFEDs, IBs, CPOs and CTAs must review their operations using NFA’s Self-Examination Questionnaire (Questionnaire). The Questionnaire is designed to aid Members in recognizing potential problem areas and to alert them to procedures that need to be revised or strengthened.

Regulatory Reminder Regarding Obligations Guaranteed by FCMs, FDMs and IBs
On May 27, 2020, the Joint Audit Committee issued a Regulatory Alert to FCMs addressing the net capital treatment of guaranteed obligations and liabilities of subsidiaries or affiliates. Certain CFTC Regulations require the reporting of guaranteed obligations and liabilities of subsidiaries or affiliates in the computation of adjusted net capital. NFA is issuing this Notice to remind Members that these requirements also apply to RFEDs (i.e., FDMs) and IBs.

ESMA promotes convergence in the supervision of costs in UCITS and AIFs
The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, has published today a supervisory briefing on the supervision by National Competent Authorities (NCAs) of costs applicable to Undertakings for the Collective Investment in Transferable Securities (UCITS) and Alternative Investment Funds (AIFs). This briefing comes in response to the need to improve convergence across NCAs in the approach to undue costs.

ESMA fines Scope Ratings EUR640,000 for failings in covered bonds ratings
The European Securities and Markets Authority (ESMA), the EU’s securities markets regulators, has fined Scope Ratings GmbH (Scope) EUR640,000, and issued a public notice, for breaches of the Credit Rating Agencies Regulation (CRAR) in relation to the systematic application of its 2015 Covered Bonds Methodology (CBM) and its revision.

Former CEO and director of Sirtex Medical Limited sentenced for insider trading
Mr Gilman Edwin Wong, the former Chief Executive Officer and Director of Sirtex Medical Limited, has been sentenced in the District Court of New South Wales having pleaded guilty to an offence of insider trading (19-168MR).

Tech Company Cries Foul on Pandemic Trading Suspension; Regulators suspended Nano Magic’s stock over information they said could mislead investors about a patent
Dylan Tokar – WSJ
The U.S. Securities and Exchange Commission has been cracking down on companies that make dubious claims about how they can help fight the coronavirus pandemic. Now, one technology company says the regulator went too far. Nano Magic Inc., a maker of lens care, anti-fog and electronic device protection products, has mounted a novel challenge to an SEC decision on April 30 to temporarily freeze its stock over online claims that a disinfectant the company held a patent for could “kill” the novel coronavirus.

US chicken executives charged with price-rigging; Case against Pilgrim’s Pride and Claxton executives is first in long-running criminal investigation
Gregory Meyer – FT
Four US poultry executives have been indicted in the first criminal case to emerge from a years-long investigation into whether meat companies rigged the price of chicken sold to restaurants and grocers.

Four Warburg Bankers Indicted as German Tax Probe Escalates
Karin Matussek – Bloomberg
Four M.M. Warburg & Co. bankers were indicted in Germany over their role in the Cum-Ex scandal, paving the way for another trial that has roiled the financial industry.

SET, Thailand’s SEC Jointly Launch Prof. Link Digital System, Ready For Service July 2020
The Stock Exchange of Thailand (SET) has signed a Memorandum of Understanding (MOU) with the Securities and Exchange Commission (SEC) in connecting the database on the licenses granted to investment consultants (ICs), investment planners (IPs) and investment analysts (IAs), for over 80,000 professionals in total, through the Professional Link Digital Platform system, named Prof. Link. The mutual project aims to elevate and enhance efficiency in knowledge development for all professionals in the capital market and build quality personnel to benefit investors and facilitate the industry. SET has scheduled to launch the Prof. Link system services in July 2020.

Whistleblower Files Supplemental SEC Petition Exposing Facebook’s Assistance To White Supremacist Hate Groups
A confidential whistleblower assisted by the National Whistleblower Center (NWC) today filed a supplement to its 2019 petition to the U.S. Securities and Exchange Commission (SEC) calling for sanctions against Facebook for its deception of shareholders and the public.

Investing and Trading

Fund groups enter digital arms race to keep remote clients engaged; From Peloton rides to home schooling tips, asset managers are beefing up their offerings
Siobhan Riding – FT
From dinners at smart restaurants to golf on famous courses and meetings in elegant City boardrooms, asset managers have long placed an emphasis on the human touch in their interactions with clients.

Private equity eyes $400bn windfall from US retirement savers; Trump administration says asset class can be used in some funds within 401(k) plans
Billy Nauman – FT
The Trump administration on Wednesday cleared a path for ordinary savers to invest in private equity funds through their employer-sponsored retirement accounts, handing the alternative investment management industry a victory after a years-long push.

China’s Yuan Joins Ranks of World’s Most Influential Currencies
Ruth Carson, Livia Yap, and Simon Flint – Bloomberg
Currency punches above its weight in investors’ attention; Yuan seen pivotal as gauge of state of U.S.-China tensions
When the offshore yuan matched its record low last week, it served notice that China’s exchange-rate fixing had returned as a key variable to participants in the $6.5 trillion-a-day global foreign-exchange market.

This Is Bad, But It’s Not Looking Like the Depression
Peter Coy – Bloomberg
Unemployment in the U.S. is getting to the levels of the Great Depression of the 1930s, as predicted by a range of economists from the liberal Nobel laureate Paul Krugman to President Donald Trump’s chief economic adviser, Kevin Hassett. On Friday the Bureau of Labor Statistics will release the employment report for May. The median forecast of the report’s unemployment rate from economists surveyed by Bloomberg is 19.5%, worst since the 1930s. But as bad as it is, the unemployment rate is a bit of an outlier. Other measures of the health of the economy are considerably stronger than they were during the Depression, which was really two downturns separated by a brief recovery. Here’s a tour of the data.

World’s Least Favored Currencies Suddenly Became Global Leaders
George Lei and Justin Villamil – Bloomberg
Latin American currencies gain on liquidity, cheap valuation; No immediate technical barriers in place even as FX overbought
Latin American currencies have staged a rebound since mid-May on fledgling signs of renewed global growth and as central banks pour liquidity into the system. Technical barriers to further gains are few and far between.

Living Close to Oil Wells Leads to Lower Birth Weights; New research from the University of California at Berkeley is the first broad-based study to examine local health impacts of drilling in the state.
Leslie Kaufman – Bloomberg
Humans have lived side by side with oil development for over a century, but it’s only recently that scientists started tracking the health consequences of that proximity. A new paper published today in the journal Environmental Health Perspectives shows that pregnant women in rural areas who lived within one kilometer of high-producing wells were 40% more likely to have low birth weight babies compared to those who lived further away.

The Nearly Nihilistic Market Rally; Markets care about one set of policy developments to the exclusion of everything else
Mike Bird – WSJ
The world is in a state of nearly unparalleled turmoil—except for financial markets, which seem blithely unaware. The S&P 500 was up a further 0.8% Tuesday, following a 0.4% gain Monday. That makes for a 10-day gain of nearly 5%.

For African-Americans, a Painful Economic Reversal of Fortune; Fallout from pandemic and protests highlights income and wealth gaps that leave black Americans vulnerable
Greg Ip – WSJ
In the decade before Covid-19, African-Americans’ economic circumstances, crushed during the 2007-09 recession, had slowly but steadily improved. Then lockdowns crashed the economy, and last week the death of a black man, George Floyd, at the hands of police touched off a wave of angry and at times violent protests.

Making Money Is Good. Doing Good Is Even Better; It’s time for fund managers to take an active environmental stance on investments, even if there’s an initial financial cost.
Mark Gilbert – Bloomberg
Some of us are still clinging to the hope that the destruction the pandemic has wrought on lives and livelihoods will be offset by a kinder, simpler, more equitable aftermath for society.


Hedge funds brace for second stock market plunge; Managers say asset prices have become too detached from bleak fundamentals
Laurence Fletcher – FT
Hedge funds are getting ready for another slump in stock markets after growing uneasy that surging prices do not reflect the economic problems ahead.

Coatue’s $350 million quant hedge fund pulled money out of the market in a move that exposes the dangers of data-driven trades
Bradley Saacks and Alex Morrell – Business Insider
Coatue Management’s $350 million quant fund has significantly reduced its exposure to the markets since early April, when the coronavirus pandemic shut down the global economy, sources say.

BNP Paribas Fortis Has Chosen Worldline To Set Up And Operate Its Omni-Channel Contact Service Center
Worldline [Euronext: WLN], the European leader in the payments and transactional services industry, has sealed a multi-year contract with BNP Paribas Fortis, a leading financial institution in Belgium and across Europe. Under this agreement, Worldline will set up and operate BNP Paribas Fortis’ omni-channel Contact Service Center (CSC) using WL Contact. Operating in SaaS (Software-as-a-Service) mode, this proven contact center solution will handle all interactions with customers, through whichever access channel they choose to use.

Investment bank Perella Weinberg Partners cutting staff by 7%: source
Kanishka Singh – Reuters
Boutique investment bank Perella Weinberg Partners is cutting about 7% of its workforce amid the coronavirus outbreak, a person familiar with the matter told Reuters on Wednesday.

Citigroup chief compliance officer Mark Carawan retires
Citigroup Inc (C.N) said on Wednesday its chief compliance officer Mark Carawan is retiring after eight years at the firm, effective June 8.

Vanguard’s Eight-Year Quest to Crack $1 Trillion Market Drags On
Ksenia Galouchko – Bloomberg
Fund giant trails rivals with just 5.4% of Europe’s ETF assets; Retail-friendly approach faces resistance as institutions rule
Nearly a decade after arriving in Europe’s exchange-traded fund market, Vanguard Group doesn’t have to look far for reminders of just how tough it can be.


HSBC Throws Support Behind China on Hong Kong Security Law; A top bank executive signed a petition backing Beijing’s increased hand in the territory’s affairs
Jing Yang and Simon Clark – WSJ
A top HSBC HSBC 4.60% executive signed a petition supporting China’s move to impose security legislation on Hong Kong, putting the bank squarely on the side of Beijing in the fight over the future of the territory.

Standard Life Aberdeen staff to work from home until next year
Scottish Financial News
Standard Life Aberdeen has told the majority of its staff to work from home until the end of this year. Yesterday the company told 4,900 UK employees working from home during the UK’s lockdown not to expect to come back to the office this year.


Andrew Bailey presses bank chiefs on no-deal Brexit preparations; Warning from Bank of England governor comes as negotiations between the UK and EU stall
Chris Giles and Stephen Morris – FT
Andrew Bailey, the Bank of England governor, has pressed bank bosses to make sure they have adequate preparations in place in case the UK and EU fail to agree a free trade deal by the end of this year.

EU and U.K. Have Made No Progress in Brexit Talks, Germany Warns
Jonathan Stearns – Bloomberg
German ambassador to bloc urges Britain to be ‘more realistic’; Michael Clauss says an accord between both sides is possible
The European Union and U.K. have made “no real progress” in negotiations on a free-trade pact and the British government must show more flexibility for a breakthrough to be reached, Germany’s ambassador to the EU said.

Theresa May attacks Boris Johnson over Brexit and Covid quarantine plans
Peter Walker – The Guardian
Theresa May has launched a double attack on Boris Johnson’s government, speaking in the Commons to first warn about the security implications of a final no-deal Brexit, and then against the coronavirus quarantine plans. May, who has largely kept a low profile since returning to the backbenches, used prime minister’s questions to express worry at a lack of possible lack of intelligence and data sharing if the Brexit transition period ends without a formal agreement.

Covid crisis likely to mask economic fall out of no-deal Brexit
Chris Giles – FT
With talks between the EU and UK deadlocked, Britain is once again confronted by the prospect of a no-deal Brexit come the end of the year. Yet with the UK economy already ravaged by coronavirus, some economists and policymakers in Britain are wondering whether the effects of the UK failing to secure a trade deal with Brussels could be masked by the impact of the pandemic.

Brexit transition extension ‘essential’ to protect Scottish economy
BBC News
Billions of pounds could be wiped off Scotland’s economy without an extension to the Brexit transition period, according to the Scottish government. Economic modelling suggests GDP could be between £1.1bn and £1.8bn lower by 2022 (0.7% to 1.1%) without a delay. The transition period, due to end on 31 December, can be extended by up to two years if agreed by the end of June. The UK government has said it has no intention of doing so, and needs “flexibility” to deal with coronavirus.


Ways to Stay Motivated When Every Day Is the Same as Yesterday; You don’t have to be working on a cure for coronavirus to find value in your job.
Sarah Green Carmichael – Bloomberg
It can be tough to stay motivated when all the days blend into one. You might feel lucky to have a job, yet still struggle to concentrate on tasks or maintain enthusiasm for your work. Even responsibilities you once enjoyed can lose their sizzle.

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CME to permanently close most trading pits

CME to permanently close most trading pits

First Read $40,626/$300,000 (13.5%) Anonymous ++++ Hits & Takes John Lothian & JLN Staff Without fanfare or amplification from its executives, the CME Group shut the books on most -- but not all -- of its floor trading history Tuesday afternoon with the...

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