Sean O’Toole, Ellen Resnick, David Silverman and Michael E. Unetich
The Mega-Macro Event That Upsets Everything Everywhere
By John J. Lothian
When Julie Ros of Profit & Loss announced the closing of the publication, she listed all of the macroeconomic events that P&L had overcome over the years, including 9/11 and the financial crisis. This one they were not able to overcome, and so Ros decided to close up. After a discussion with Ros late on Friday, I decided it was not a macroeconomic event that caused P&L’s closing, but a mega-macroeconomic event.
A macroeconomic event caused me to lose my first job after graduating from college; the Farm Crisis of 1984. There was another macro event in the futures industry that coincided with the Farm Crisis; the reorganization of the regulatory structure of the industry as the National Futures Association came online and implemented the new FCM/IB framework.
My first job was as a news reporter in 1984-85 for Commodity News Service (“CNS”), which was owned by Knight Ridder. CNS was one of two major wire services covering the markets at the Chicago Board of Trade, the other was Reuters.
The CNS wire service had a competitive advantage over Reuters because of the width of the thermal paper on its printers. Commodity News Service’s printers had thermal paper the width of a roll of paper towels and Reuters was the width of toilet paper. CNS could print weather maps and Reuters could not, which was important for futures markets dominated by agricultural trading.
To read the rest of this commentary, go here.
Hemp Production Normalizes (not NORMLizes)
Thom Thompson – John Lothian News
Hemp farming is experiencing normal growing pains. We can see the industry’s maturation in the evolution of the legal, commercial and business issues hemp farmers and processors are grappling with. Instead of struggling with regulatory restrictions, hemp producers are confronting issues that could beset any infant industry.
South Carolina newspapers are reporting that a former Clemson University national champion football (1981) coach who returned to farming after retiring from coaching is now embroiled in a lawsuit with a local hemp processor. Coach Danny Ford joined four other South Carolina hemp-growing licensees in a suit against Charleston Hemp Company and Carolina Botanicals. It seems the processing of the five farmers’ raw hemp into CBD oil did not go smoothly.
In a practice that is not uncommon in agriculture, the farmers obtained their seeds from the processor. In a sign that this hemp lawsuit is agricultural business-as-usual, the plaintiff’s attorney told local news service The State, “We believe that accountability is important, particularly in relatively new industries like the South Carolina hemp industry, and we will look forward to pursuing accountability at a jury trial when the time comes.”
To read the rest of this story, go here.
Hits & Takes
John J. Lothian & JLN Staff
Sean O’Toole, David Silverman, Michael Unetich, Ellen Resnick and Anonymous are the latest to make a donation to the JLN MarketsWiki Education GoFundMe campaign. Sean O’Toole is a CBOT member, David Silverman is a former CME board member and now proprietary trading executive. Michael Unetich is a Trading Technologies executive and former trader whose story was told recently in The Path to Electronic Trading. Ellen Resnick is the brilliant public relations professional behind Crystal Clear Communications. She is also a former head of corporate communications for the Chicago Mercantile Exchange. And Anonymous is just another supporter who wishes to stay behind the scenes. Thank you to all of them, to all who have given and all who have yet to give to our GoFundMe campaign. Help support our efforts to preserve industry history by contributing to our GoFundMe campaign.
Betty Liu is leaving ICE and NYSE today after two years as chief experience officer of ICE and executive vice chairman of NYSE. She is off to investing and acquiring media companies, and hopes ICE will be an investor. She announced this on LInkedIn.
Global Trading Editor Terry Flanagan recently interviewed Cboe’s Jerry Hanweck, VP Software Engineering, Information Solutions, about the Cboe Theoretical Value, or “Cboe Theo,” a new options pricing model.
The FIA has announced the fintech startups chosen for its sixth annual Innovators Pavilion at FIA EXPO-V. The companies chosen are: Blue Water Financial Technologies, Capitalise.ai, Disent, OilX, Options AI, Riskfuel Analytics, Sylvera, TradeX and WeMatch.
Kristin Boggiano of CrossTower has an article in Cointelegraph titled “Central bank digital currencies have the power to upend global finance.”
The NFA has a notice on their website: If you engaged in business with Gregory L. Gramalegui or Emini Trading School between October 2010 and 2015, you may be eligible for restitution. Visit the NFA’s restitution page to learn if you qualify.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
The Spread: The Final Countdown
This week on The Spread – the VIX hits a 5-month high one week before the U.S. election, FIA Expo goes virtual, and more.
The pope has had it with people around the world complaining about coronavirus restrictions
Shawn Langlois – MarketWatch
‘We don’t come out of the crisis the same, we can become better or worse, but never the same.’
That’s Pope Francis calling for a united front in the battle against the coronavirus pandemic in a translation of an interview cited by Bloomberg News on Sunday. “We have an increase in numbers of those who mercilessly profited from the misfortune of others, those who think only about themselves, who protested or complained about certain restrictive measures, unable to accept that not everyone has the same abilities and resources to face the pandemic,” he said, according to the Serbia-based Politika newspaper.
*****Blessed are those who don’t complain.~JJL
Scholars warn of collapse of democracy as Trump v Biden election looms; Dozens of experts on fascism warn of global danger, calling for action from ordinary people: ‘It is not too late’
Lois Beckett – The Guardian
Dozens of historians of fascism and authoritarianism have signed a letter warning that democracy “is either withering or in full-scale collapse globally”, and urging ordinary people to take action. “Democracy is extremely fragile and potentially temporary, requiring vigilance and protection,” the scholars wrote in the letter released on Sunday. “It is not too late to turn the tide.”
*****It is either the end of the world as we know it, or the end of hyperbole as we know it. Pick your poison.~JJL
What’s Ken Griffin’s endgame in his push against Pritzker’s ‘fair tax’? Always look at self-interest when money is involved.
Rich Miller – Crain’s Chicago Business
Chicago billionaire Ken Griffin has spent $53.75 million to convince Illinoisans to reject a proposed graduated income tax this year. Illinois currently has a flat income tax. Everyone pays the same rate, rich or poor. Gov. J.B. Pritzker campaigned heavily on increasing taxes on upper-income voters and followed through by convincing the General Assembly to put a constitutional amendment on the ballot. The billionaire Democrat has since spent $56.5 million of his own money to promote the change.
*****Who is the boss of Illinois?~JJL
I’m Here To Remind You That Trump Can Still Win
Nate Silver – FiveThirtyEight
It’s tempting to write this story in the form of narrative fiction: “On a frigid early December morning in Washington, the Supreme Court ruled 5-4 that disputed mail ballots in Pennsylvania—” You know, that kind of thing. But given the stakes in this election, I think it’s important to be prosaic and sober-minded instead.
*****While this article focuses on polling in politics this is not JLN trying to be political. The article is neutral and is not rooting for one side or another. I include it because, with the election in the US tomorrow, it is timely and interesting but, also, it does a great job at explaining what polling does and does not tell us. It applies well beyond politics.~JB
Friday’s Top Three
Our top story Friday was Profit & Loss’s A Message from Julie Ros, Founder of Profit & Loss, in which Ros announces the shutdown of P&L after 21+ years. Second was Bloomberg Businessweek’s Susquehanna Will Take Your Election Bets, Up to $100 Million. Third was Yahoo News’s GOP Sen. Kelly Loeffler: ‘Not familiar’ with Trump’s infamous 2005 ‘Access Hollywood’ tape.
191,661,203 pages viewed; 24,482 pages; 226,515 edits
|CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.Recently Updated Pages
1,466 pages; 13,007 edits
China boosts foreign access to huge onshore capital markets; Opening up futures trading is latest sign of how Beijing is forging ties with Wall Street
Thomas Hale and Hudson Lockett – FT
New rules making it easier for international investors to trade in China’s booming capital markets have come into force, adding momentum to Beijing’s sweeping liberalisation of its financial system. The measures, which went into effect on Sunday, update the official schemes that govern foreign access to the country’s enormous capital markets. They allow much greater access to China’s onshore futures markets, an important tool in hedging stock market positions as well as for speculating on price movements. Foreign investors will also be able to lend out their holdings of shares that trade in Shanghai and Shenzhen, allowing others to use them to take bearish positions.
What we can learn from 1918’s deadly second wave
Kristen Rogers, CNN
In the deadly fall wave of the 1918 flu pandemic, millions of people were doomed because they didn’t know what we know now about how viruses and respiratory illnesses spread. We might face a similar fate if some people continue to ignore what a century of scientific progress and hindsight have taught us about ending pandemics.
Euro Stoxx Benchmark Index Fails to Calculate Prices at Open; For about an hour, the widely followed Stoxx Europe 600 and the Euro Stoxx 50 didn’t budge even as underlying shares continued to trade
Caitlin Ostroff – WSJ
Two widely followed European benchmark stock indexes failed to show prices for about an hour after markets opened Monday because of issues with index calculation, according to the operator. The Stoxx Europe 600 and the Euro Stoxx 50 failed to show changes in their levels at open due to “input data problems,” according to Andreas von Brevern, a spokesman for index operator Deutsche Börse Group. Mr. Von Brevern declined to elaborate on what caused the issues but said the operator was working to resolve them.
Dark Web Hackers Claim to Hold Keys to 10K Robinhood Accounts: Report
Kevin Reynolds – Coindesk
Access to more than 10,000 login keys allegedly linked to Robinhood trading accounts were on the market last week on the dark web, according to a report by Bloomberg, which surveyed dark web marketplaces.
Goldman, Deutsche Ask U.K. Staff to Work at Home on Lockdown
Viren Vaghela – Bloomberg
U.K. units bring in measures that will empty London offices; Deutsche Bank has 8,000 U.K. staff, Goldman more than 5,000
Goldman Sachs Group Inc. and Deutsche Bank AG have informed staff that only essential employees can work from their U.K. offices after Boris Johnson announced a new nationwide lockdown to arrest a second wave of the coronavirus. “We will substantially reduce the numbers of colleagues working from the office,” said Tiina Lee, Deutsche Bank’s U.K. chief executive officer, in a memo Sunday. “We must ensure only those that cannot carry out their role from home are in the office.”
The stock market has made its prediction about who will win the election
David Goldman, CNN Business
New York (CNN Business)The presidential election is just two days away and the stock market has locked-in its prediction, according to one indicator. The S&P 500 (SPX) fell 0.04% between July 31 and October 31. That means the market forecasts — by a hair — that Joe Biden will win, according to CFRA Research’s Presidential Predictor.
Should the world fear a post-pandemic debt crisis? The short-term economic outlook remains worrying worldwide, particularly for small and medium-sized companies fighting to survive. But a large-scale debt crisis may not be nearly as likely as many fear
Terry Chan and Alexandra Dimitrijevic – South China Morning Post
As countries, companies, and households confront the Covid-19 pandemic’s economic fallout, many market watchers are sounding the alarm about rapidly rising leverage worldwide. And for good reason: in an acceleration of a years-long trend, the debt-to-GDP ratio among these three sets of borrowers is set to swell by 14 per cent this year, to a record 265 per cent.
Trump Promotes Political Violence In Defense Of Supporters Who Swarmed Biden Bus; Days before the election, the president tweeted that his supporters “did nothing wrong” when they nearly drove a Biden campaign bus off a Texas highway.
Sanjana Karanth – MarketWatch
President Donald Trump openly promoted people carrying out political violence on his behalf Sunday ? two days before the election ? in comments defending his supporters in Texas who dangerously swarmed a campaign bus for Democratic opponent Joe Biden. The president tweeted Sunday evening in response to reports that the FBI has launched an investigation into an incident Friday where a caravan of Trump supporters surrounded a Biden campaign bus in Texas, nearly driving it off the stretch of highway between Austin and San Antonio.
How Stock Traders Are Racing to Protect Gains Against Market Threats; We spoke with individual investors about the best strategies to cope with uncertainty around Covid, the health of the economy, and U.S. elections.
Edward Robinson – Bloomberg
Bitcoin, the fear index, and cold cash. Those are just a few of the assets retail investors are piling into as they confront the triple threat of the Covid-19 pandemic, global recession, and a rumbustious presidential election in the U.S. After a gravity-defying period that saw major indexes hit all-time highs, jitters are setting in — last week global equities posted the worst weekly decline since March.
Honeywell Takes Tiny Steps Toward a Quantum Leap in Computing; Overshadowed by IBM and Google, it’s trying a different approach to reach the industry’s holy grail.
Thomas Black – Bloomberg
A decade ago, two scientists at Honeywell International Inc. pitched their bosses a most improbable idea: The century-old industrial company should build a quantum computer. The idea was met with some skepticism. For one thing, International Business Machines Corp. and Google were already moving ahead on quantum computing, which promises to be much faster, for certain tasks, than even the speediest transistor-based chips. And Honeywell was better known for making cockpit controls, security systems, and even work boots.
These Are the Airlines Teetering on the Brink of Covid Ruin
Anurag Kotoky and Angus Whitley – Bloomberg
List populated by carriers in Africa, Latin America and Asia; Airlines with scant government support more likely to flail
Having a home government with deep — and open — pockets is emerging as key in terms of whether an airline will make it through the coronavirus pandemic. Carriers in jurisdictions where there is scant support from up high are most likely to go bust, according to an analysis by Bloomberg News. Using the Z-score method developed by Edward Altman in the 1960s to predict bankruptcies, Bloomberg sifted through available data on listed commercial airlines to identify the ones most prone to financial strife.
An automated trading firm turns its machine learning expertise to venture capital investing
John Detrixhe – Quartz
XTX is well known in the financial industry as an automated trading firm—it buys and sells some $250 billion of assets, from foreign-exchange to stocks and US Treasuries, each day. It’s the only company in the top ranks of currency trading that isn’t a global investment bank, according to annual polls of institutional investors by Euromoney.
Guidelines for COVID-19 tests for airline passengers could set global bar for reliability, sources say
Allison Lampert, David Shepardson – Reuters
A global aviation manual now under review by a UN body suggests global guidelines calling for the use of highly reliable tests when screening passengers to detect the novel coronavirus ahead of flights, three sources familiar with the matter said.
Who is the world’s best banker? It may be someone few outside Asia have heard of: Aditya Puri, of India’s HDFC Bank
impressive banker on the planet? Judged by their swagger and $20m-40m paypackets, the bosses of Wall Street’s big firms are contenders; yet several run firms that have delivered weak returns, been bailed out and left a toxic trail of scandals. Measured by sheer clout, the heads of China’s state lenders are in the running. The boss of Agricultural Bank of China keeps an eye on a mere 23,000 branches and half a million staff. But he is an instrument of the Communist Party.
Tech Workers Take to the Mountains, Bringing Silicon Valley With Them; The diaspora of tech talent is apparent in towns around the Rockies, where wealth and business activity are rising, along with property prices
Katherine Bindley – WSJ
Tech staffers from the Bay Area are relocating across the country, bringing to their new locales the woes and upsides that go with some of America’s highest-paying jobs. Employers including Facebook Inc., FB -6.31% Twitter Inc. TWTR -21.11% and Stripe Inc. have liberated their staffers, allowing them to work from wherever they want. As a result, some are leaving the Bay Area to live in Western mountain communities that they had already been drawn to, like Boise, Idaho, and Park City, Utah. The transplants are adding more wealth and business to their new hometowns but also widening wage gaps and raising real-estate prices.
LIBOR reform: full steam ahead
Steven Swann – AloudEconomics
As the shift away from reliance on the London Interbank Offered Rate (LIBOR) enters its final stages, the financial industry faces a crucial challenge. The long-standing benchmark is to be discontinued from December 2021, leaving financial institutions only a matter of months to complete their preparations. The transition away from LIBOR follows the wave of benchmark regulation that followed the financial crisis of 2008. In response to this regulation and in the wake of successive scandals, the Financial Conduct Authority (FCA) determined that LIBOR was no longer fit for purpose, thus setting the course for market participants to establish a more robust alternative to the discredited reference rate.
How the Wealthy World Has Failed Poor Countries During the Pandemic; Despite pledges for debt relief and expanded programs, the World Bank and International Monetary Fund have delivered meager aid, say economists.
Peter S. Goodman – NY Times
Like much of the developing world, Pakistan was alarmingly short of doctors and medical facilities long before anyone had heard of Covid-19. Then the pandemic overwhelmed hospitals, forcing some to turn away patients. As fear upended daily life, families lost livelihoods and struggled to feed themselves.
The future of fiscal policy without traditional constraints; Covid response has shown inflation and interest rates no longer dictate limits on debt
Gavyn Davies – FT
The surge in public debt in the major advanced economies caused by the pandemic continues apace. Even on the very optimistic assumption that there will be no need for further major economic lockdowns, Fulcrum economists calculate that the ratio of gross government debt to gross domestic product in the major advanced economies will reach about 141 per cent next year, a rise of around 26 percentage points from 2019. More than half of this extra debt has been absorbed by the central banks.
Tech Startups Say New Pay Rules for H-1B Visas Are Unaffordable; New restrictions intended to protect U.S. workers curb access to pool of highly skilled foreign labor
Heather Somerville and Michelle Hackman – WSJ
New rules from the Trump administration restricting skilled foreign workers are unnerving U.S. startup hubs, as founders and investors say the limitations will hamstring their ability to recruit top-tier talent to grow their businesses.
At least 31 states set their one-day coronavirus case records in October
Madeline Holcombe – CNN
October was a month of grim records in the Covid-19 pandemic, and as November begins, experts say the United States hasn’t seen the worst of it. From Alaska to Maine, at least 31 states across the US reported at least one record-high day of new coronavirus cases in the past month, according to data from Johns Hopkins University. Fifteen reported their highest one-day tallies of Covid-19 deaths.
Jerome Kemp on the skewed economics of clearing; Only Fed intervention prevented “a really big market disaster” during Covid, says derivatives veteran
Costas Mourselas – Risk.net
Jerome Kemp leaves his job at the helm of Citi’s clearing business with many battles won, but plenty of unfinished business. After a year in which he managed – from his kitchen table – Citi’s response to coronavirus-induced market turmoil, he leaves the front lines of one of the biggest jobs in derivatives with deep pride at Citi’s blistering growth in derivatives clearing from a standing start in the near-decade he spent with the firm. According to disclosures to the Commodity Futures Trading.
Skadden, Kirkland & Ellis Top Legal Advisers By Value, Volume In Financial Services Sector During Q1-Q3 2020, Finds GlobalData
Skadden, Arps, Slate, Meagher & Flom and Kirkland & Ellis were the top legal advisers for mergers and acquisitions (M&A) in the financial services sector by value and volume, respectively, during Q1-Q3 2020. A total of 2,250 M&A deals were announced in the financial services sector during the period, according to GlobalData, a leading data and analytics company.
Coronavirus tally: Global cases of COVID-19 46.6 million, 1.2 million deaths and Trump hints at firing Fauci
Ciara Linnane – MarketWatch
The global tally for confirmed cases of the coronavirus that causes COVID-19 climbed to 46.6 million on Monday, according to data aggregated by Johns Hopkins University, while the death toll rose to 1.2 million. The U.S. has the highest case total at 9.2 million and deaths at 231,003. Dr. Anthony Fauci, America’s foremost infectious-disease expert and the director of the National Institute of Allergy and Infectious Diseases, told the Washington Post that the U.S. is “in for a whole lot of hurt,” during the winter months with cases spiking across the nation. Fauci added that the U.S. needs to make an “abrupt change” in public health practices and behaviors as the holiday season approaches, and praised Democratic candidate Joe Biden’s campaign for “taking it seriously from a public health perspective,” rather than Trump’s focus of reopening the country.
States Hire Consultants for Covid-19 Help, With Mixed—and Expensive—Results; Struggles over unemployment claims and medical supplies opened the door to big consulting firms to reap millions of dollars
Jean Eaglesham and Kirsten Grind – WSJ
State governments struggling with the coronavirus pandemic have paid tens of millions of dollars to big consulting firms for help. The consultants promised to help the states tackle a range of problems, including delivering medical equipment and staffing call centers that handle worker benefits. In some cases, states have seen only modest benefits, if any at all, for the extra cost, The Wall Street Journal found through interviews and public-records requests.
The East-West Gap on Pandemic Control May Be Finding Its Way Into Markets; In March, the panic and turmoil was too dominant for investors to pick between successful and unsuccessful control policies, but now those factors may come to the fore
Mike Bird – WSJ
A sharp new economic gap is likely to open between countries where the virus has either been reduced to imperceptible levels or is under relative control, and those where it isn’t. That will also become increasingly visible in financial markets. Purchasing managers index data for October, released Monday, was encouraging: Taiwan and China’s surveys remain in solid growth territory, and South Korea reported an expansion for the first time since January. Japan’s figure is still narrowly below recovery territory, but not by much.
England Virus Lockdown May Be Extended Beyond December
Lucy Meakin and David Goodman – Bloomberg
Gove notes risk to economy, confidence if hospitals swamped; Non-essential stores, restaurants set to close from Nov. 5
Less than a day after Prime Minister Boris Johnson announced a month-long lockdown for England, one of his top ministers and closest allies signaled the measures might have to be extended if they fail to contain the spread of the coronavirus.
Surrender Is Not a Valid Coronavirus Plan; Other countries have figured out how to manage it without vaccines.
Mark Gongloff – Bloomberg
First of all, it’s time to look into relocating to Vermont or Maine. Second, even this map doesn’t do the ugliness of the numbers justice. For that, you must go to the original source and mouse over each state to see the underlying data. North Dakota’s cases per million are actually seven times higher than New Jersey’s, for example. Wisconsin’s are five times higher. As President Donald Trump makes clear daily, his plan for the coronavirus is merely a white flag, waved vigorously. It doesn’t have to be this way, writes Bloomberg’s editorial board. It can’t be, really, without once again swamping hospitals and inflating an already staggering death toll. Vaccines won’t come nearly soon enough to prevent that.
U.K. Increased Covid’s Spread by Subsidizing Diners, Study Finds
Jason Gale – Bloomberg
Eat-Out-to-Help-Out program linked to surge in virus clusters; Program may have caused up to 17% of U.K. cases during summer
The U.K.’s Eat-Out-to-Help-Out program, hailed as an economic cure for its ailing restaurant industry, may have substantially worsened the pandemic, research showed. The government spent 500 million pounds ($647 million) subsidizing the cost of restaurant meals and non-alcoholic drinks by as much as 50% in August, even after evidence had emerged that Covid-19 could easily spread in hospitality settings, a study from the University of Warwick found.
Gottlieb says Thanksgiving could be ‘inflection point’ for winter coronavirus surge
Mike Murphy – MarketWatch
Former FDA commissioner Dr. Scott Gottlieb warned Sunday that Thanksgiving will be an “inflection point” for the coronavirus pandemic, and that things will only get worse in December. Speaking Sunday on CBS News’s “Face the Nation,” Gottlieb, President Donald Trump’s former head of the Food and Drug Administration, said “things are getting worse around the country. I think Thanksgiving is really going to be an inflection point. I think December is probably going to be our toughest month.”
‘We’re in for a whole lot of hurt.’ Fauci’s comments infuriate the White House.
Daniel Victor – NY Times
He has been dragged into both campaign debates, where President Trump misrepresented his positions on the pandemic. He has been featured prominently — and out of context — in a Trump re-election ad. And he has been openly derided by his own boss as a “disaster.” Now, it seems, Dr. Anthony S. Fauci, the nation’s top infectious expert, may have had enough.
Doctors Begin to Crack Covid’s Mysterious Long-Term Effects; Severe fatigue, memory lapses, heart problems affect patients who weren’t that badly hit initially; ‘It’s been so long’
Sarah Toy, Sumathi Reddy and Daniela Hernandez – WSJ
Nearly a year into the global coronavirus pandemic, scientists, doctors and patients are beginning to unlock a puzzling phenomenon: For many patients, including young ones who never required hospitalization, Covid-19 has a devastating second act.
France grapples with lockdown backlash from small shops
The French government promised on Sunday to support the nation’s beloved independent shops that fear losing their business to international giants, such as Amazon.com Inc AMZN.O, as it sought to quell opposition to a new coronavirus lockdown.
This AI can identify the coughs of asymptomatic people with Covid-19
Rachel Kraus – Mashable
Sometimes, artificial intelligence knows more about us than we know about ourselves. And when it comes to diagnosing Covid-19, that could be a pandemic-fighting boon. Researchers from MIT have developed an algorithm they say can differentiate the forced coughs of asymptomatic people who have Covid from those of healthy people. They are currently working on a free app that would enable anyone to cough into their smartphone, and essentially get a pre-screening of whether they might have Covid, even if they don’t have symptoms.
Covid-19 Burden Falls Heavily on Middle-Aged Men; Men’s underlying health problems, weaker immune systems might be fueling higher mortality
Jon Kamp and Jason Douglas – WSJ
When Brian Peters and his 80-year-old mother both fell ill with Covid-19 last May, she seemed to face the greater risk. Lilah Peters’s age and her diabetes were two factors that can amplify the disease. Mr. Peters, who lived with her in Sergeantsville, N.J., was three decades younger, slightly overweight but otherwise in good health, according to his girlfriend, Diana Robertson. Both mother and son were hospitalized at the same time, went on ventilators and died 11 days apart.
Exchanges, OTC and Clearing
NYSE wins back listing crown from Nasdaq after luring Spacs; Boom in blank-cheque company launches adds new twist to age-old rivalry between exchanges
Richard Henderson – FT
The New York Stock Exchange is on track to steal back the crown for US stock market listings from its rival Nasdaq this year after tapping into the booming market for blank cheque companies.
Wiener Börse Welcomes XTX MARKETS As New Trading Member
(Vienna) The Vienna Stock Exchange welcomes a new trading member. London based XTX MARKETS will participate in the cash market trading of the Vienna Stock Exchange starting today, 2 November 2020. In its function as market maker for Austrian companies included in the national index ATX, they will provide additional liquidity with permanent buy and sell orders. According to the company, XTX MARKETS is a leading algorithmic trading company that provides liquidity in equity, foreign exchange, bond and commodity markets worldwide.
DGCX Registers Strong Interest In G6 Currencies And Silver Futures In October
The Dubai Gold and Commodities Exchange (DGCX) continued its strong growth trajectory during the month of October, with its G6 currencies portfolio a standout performer during the month. The portfolio recorded an impressive year-to-date (Y-T-D) volume growth of 378%, compared to the same period last year. Among the G6 currency pairs, the Euro and British Pound Futures Contracts registered the strongest performances, recording an impressive year-on-year (Y-O-Y) ADV growth of 67%, and 392% respectively.
Boerse Stuttgart records October turnover of over EUR 8,1 billion
Based on the order book statistics, Boerse Stuttgart generated turnover of over EUR 8,1 billion in October 2020 – an increase of over 34 per cent compared to the same month of the previous year.
Eurex Exchange Readiness Newsflash | Updates November 2020
Dear Eurex Participant, With this Newsflash, we would like to draw your attention to the upcoming publications, events and necessary actions for the ongoing initiatives:
HKEX Enhances Product Offering with Ant Debut
Ant Futures and Options to be introduced on 5 November; HKEX informed issuers they can list derivative warrants on Ant shares when the shares debut on HKEX’s securities market; Ant shares to be included in Designated Securities Eligible for Short Selling on 5 November
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to announce today (Monday) that it will offer investors more options on Ant Group Co Ltd (Ant, stock code: 6688) shares on the debut date (5 November 2020).
Trading Overview in October 2020; Japan Exchange Group released Trading Overview in October 2020.
Cash Equity Market – In October 2020, the daily average trading value for the TSE 1st Section (domestic common stocks) was JPY 2.2166 trillion; The daily average trading value for the ETF market was JPY 180.0 billion.
Derivatives Market – In October 2020, total derivatives trading volume was 25,508,974 contracts.
LME’s ‘green aluminium’ plan faces producer opposition; Norsk Hydro and Hindalco Industries against separate trading for metal with lower carbon footprint
Henry Sanderson – FT
The London Metal Exchange is facing pushback against its plans to launch a “green aluminium” platform to trade the metal from some of the world’s largest producers.
XTX Markets goes live with Vienna Stock Exchange for cash market trading; As a market maker for Austrian companies included in the national index ATX, XTX Markets will provide additional liquidity with permanent buy and sell orders.
Annabel Smith – The Trade
London-based market maker XTX Markets has gone live as a trading member in the cash market for the Vienna Stock Exchange.
Cash market sales statistics for October
Deutsche Börse Group
A trading volume of EUR 146.0 billion was achieved on Deutsche Börse’s cash markets in October (previous year: EUR 135.4 billion). Of this, Xetra accounted for 119.4 billion euros (previous year: 122.7 billion euros), bringing the average daily Xetra turnover to 5.4 billion euros. Turnover on the Frankfurt Stock Exchange was EUR 4.3 billion (previous year: EUR 2.6 billion) and on the Tradegate Exchange EUR 22.3 billion (previous year: EUR 10.2 billion).
Product Modification Summary: Decrease of the Minimum Price Fluctuation for Calendar Spreads and Basis Trade at Index Close (“BTIC”) Transactions in the E-mini FTSE Emerging Index Futures Contract
Decrease of the Minimum Price Fluctuation for Calendar Spreads and Basis Trade at Index Close (“BTIC”) Transactions in the E-mini FTSE Emerging Index Futures Contract.
New Product Summary: Initial Listing of the Nasdaq Veles California Water Index Futures Contract – Effective: December 7, 2020
Product Modification Summary: Amendments to the E-mini FTSE China 50 Index Futures Contract and Temporary Suspension of Trading and Clearing – Effective: November 23, 2020
Effective Sunday, November 22, 2020 for trade date Monday, November 23, 2020, and pending all relevant Commodity Futures Trading Commission (“CFTC”) regulatory review periods, Chicago Mercantile Exchange Inc. (“CME” or “Exchange”) will amend the E-mini FTSE China 50 Index Futures contract (the “Contract”) as more specifically described.
Application for Spot Call Butter Regularity
Pursuant to Regulation 1203.C. notice hereby is given that United States Cold Storage has applied to the Exchange for a declaration of regularity in Spot Call Butter at the following location:
Refinitiv’s API Rebrand Rankles Users; Because of its acquisition and subsequent rebrand, Refinitiv is being forced to change instances of its old branding that remain embedded in many of its APIs. This might sound like a simple change, but end-users are worried that it could be a costly fix.
Anthony Malakian, Max Bowie – Waters Technology
In 2018, Thomson Reuters agreed a deal to spin off its Financial & Risk business—the division that includes its financial content and technologies—to a consortium led by private-equity giant Blackstone Group. Soon thereafter, they renamed the unit Refinitiv—and it’s that name change that could potentially cost a lot of time and money for clients of the data and tech company.
Hong Kong’s fintech development could push city’s position as global financial center, official says
Saheli Roy Choudhury – CNBC
For Hong Kong’s financial technology ecosystem to grow further, the city needs more measures in the areas of funding, talent and regulation, according to a top official from the Chinese city.
Is fintech’s Series A market hot, or just overhyped?
Ryan Falvey and Theo Katsoulis – TechCrunch
According to industry reports, venture capital deal-making has notably rebounded since dropping off briefly in March as shelter-in-place orders gripped much of the country.
As seed-stage fintech investors, this has certainly been our experience: “Hot” deals are getting funded faster than ever, and we increasingly see the large multistage global funds competing for the earliest access to companies. However, in our experience and anecdotal conversations with other early-stage investors, that excitement has not been translating to the Series A stage.
Gresham Technologies expands in APAC with sales director appointment; Joel Jerome joins Gresham Technologies after working in senior sale roles at Finastra, OpenLink, and ITC Infotech.
Annabel Smith – The Trade
Data integrity and reconciliation specialist Gresham Technologies has hired a FinTech sales veteran in Singapore as it looks to expand its footprint in Asia Pacific.
FX algos contribute to thinning of order book, BIS report suggests; Research from BIS outlined that the thinning of the order book due to automation and FX algo trading could impact market functioning in times of volatility.
Annabel Smith – The Trade
Execution algorithms for FX trading are contributing to the thinning of order books which could impact the ability to absorb market shocks, a report published by the Bank for International Settlements (BIS) has suggested.
PBOC Governor Says 4 Million Transactions so Far in Digital Yuan
Yi Gang, governor of the People’s Bank of China, said a pilot program on the rollout of a digital currency in four cities has been smooth. There have been more than 4 million transactions, totaling over 2 billion yuan ($299 million) in the digital currency so far, Yi said at the Hong Kong Fintech Week conference on Monday.
Why Bitcoin Holdings Should Be Disclosed By U.S. Election Candidates
Jason Brett – Forbes
Opinion: Jared Kushner, currently the Senior Advisor to the President of the United States, was a victim during the 2016 election cycle of an extortion attempt where Bitcoin was requested as the cryptocurrency of choice for payment. On October 30, 2016, Kushner received a random email that threatened to reveal the tax returns of candidate Trump unless he paid 52 Bitcoin in exchange for not releasing the information.
China Should Take Part in Creating Global Regulatory Framework for Digital Currency, Xi Says
David Pan – Coindesk
Chinese President Jinping Xi said China should proactively participate in creating the international regulatory framework on digital currency.
Suit Alleges BitMEX Chiefs ‘Looted’ More Than $440M From Exchange After Finding Out About Probes
Kevin Reynolds – Coindesk
The top officers of HDR, the parent company of crypto trading platform BitMEX, which has been charged with facilitating unregistered trading and other violations, systematically looted $440,308,400 from HDR accounts, a civil lawsuit claims. A spokesperson for HDR called the claims “spurious.”
‘Cash Is Trash,’ So Let’s Bet $425 Million on Bitcoin
Jason Zweig – WSJ
In volatile markets, you can use cash as offense or defense. MicroStrategy Inc., MSTR 3.16% which recently had half-a-billion dollars in cash sitting around, thinks it can do both. The company could have gotten rid of its excess cash by paying a big dividend or by buying back much of its stock. Instead, MicroStrategy bet half its total assets on bitcoin. So is this a publicly traded company or is it a hedge fund?
Ripple paid $9.3 million in XRP incentives to MoneyGram in Q3 2020
Yogita Khatri – The Block
Ripple paid remittances firm MoneyGram $9.3 million in XRP incentives during the third quarter of 2020. MoneyGram revealed the figure in its earnings report released on Thursday. The Nasdaq-listed firm said Ripple paid $9.3 million, but $400,000 was offset by related transaction and trading expenses, leaving $8.9 million as a net benefit.
Uniswap Proposal to Airdrop More UNI Falls Short in Governance Vote
Zack Seward – Coindesk
The votes were staggeringly in favor, but a quorum was not reached, and Uniswap’s second-ever governance proposal has been defeated. The proposal, submitted by decentralized finance (DeFi) portal Dharma, was to distribute 400 UNI tokens each to 12,619 addresses that interacted with Uniswap through third-party apps. In a surprise airdrop on Sept. 17, over 250,000 addresses that had directly used the token-swap platform were able to claim 400 free UNI, valued at well over $1,000 at the time.
Square Funds Designer to Make Crypto Wallets Usable by Anyone
Kevin Reynolds – Coindesk
Square Crypto, the cryptocurrency arm of the payments company, said in a tweet Friday it has awarded a grant to a designer who’s trying to make bitcoin wallets usable by anyone, regardless of technical proficiency. The work Square Crypto will be funding will seek to answer a question the grant recipient, Maggie Valentine, put forward in a proposal, namely: “How can we provide an intuitive experience for non-crypto users while preserving the security of a user’s funds?”
Lagarde Seeks Public Comments About a Digital Euro, Implying a Broad Retail Offering Is Now on the Table
Kevin Reynolds – Coindesk
European Central Bank President Christine Lagarde Sunday announced an ECB survey of public opinion regarding the issuance of a digital euro, implying the central bank is considering a retail central bank digital currency (CBDC), not just one intended for use between banks, which would represent a much more profound change in the way finance works, according to Noelle Acheson, CoinDesk’s director of research.
FTX Raises ‘TRUMP’ Futures Margins as Price Suggests Lower Expectations of Election Win
Sebastian Sinclair – Coindesk
Cryptocurrency derivatives exchange FTX is increasing the margin requirements on its TRUMP and other President 2020 futures contracts.
Deribit Sees Record Bitcoin Options Volume as Activity in $36K Calls Surge
Omkar Godbole – Coindesk
Daily volumes for bitcoin options have hit lifetime highs on crypto derivatives exchange Deribit due to increased activity in deep “out-of-the-money” (OTM) call options, or bullish bets.
Why Satoshi Chose Halloween to Release the Bitcoin White Paper
Nathaniel Whittemore – Coindesk
Was it an allusion to the Reformation or something to do with the ancient pagan tradition of Samhain?
Bitcoin Developers Still Divided on Specifics of Taproot Activation
Colin Harper – Coindesk
The code for Taproot, Bitcoin’s biggest upgrade in years, is finalized and has been packaged into a forthcoming update. Only, it’s not ready to be deployed yet because Bitcoin developers have differing opinions on the best route to activation.
The Quiet Architect of Biden’s Plan to Rescue the Economy; Ben Harris is not a household name, even in economics. But he helped develop a package of tax and spending increases that have not spooked Wall Street.
Jim Tankersley – NYTimes
In recent months Joseph R. Biden Jr.’s campaign developed a virtual road show to reassure executives, investment fund managers and financiers who were nervous that the Democratic candidate’s plans to increase taxes could hurt the American economic recovery.
U.S. Employers Are Giving More Workers Paid Time Off to Vote; Some are putting their support for democracy into action in this election.
Maria Eloisa Capurro – Bloomberg
More U.S. employers recognize how important voting is and are making it less onerous — and costly — for workers to get to the polls. More than 80 million Americans already have cast ballots during early voting ahead of the Nov. 3 election, and many people have to wait for hours in line to vote. A Bloomberg roundup showed that some companies in banking, tech, autos and retail are providing anything from one hour to a whole day off on Election Day. Others said they encourage employees to vote but don’t have specific policies. That can mean workers have to vote on their own time or not vote at all.
Fund Manager Nightmare Is Biden Without Blue Wave Congress
Michael P. Regan, Claire Ballentine, and Vildana Hajric – Bloomberg
Market may ‘revolt’ if stimulus stalls in 2021: QMA’s Campbell; Senate control looks like ‘jump ball’ to one fund manager
Wall Street has been warming to the idea that a Joe Biden presidency would be bullish for stocks. However, there are strings attached: His victory needs to be accompanied by a “blue wave” that sweeps Democrats into the majority of both the Senate and House of Representatives.
The Many Unintended Consequences of the Electoral College; For 230 years, lawmakers have been trying to improve our flawed system for picking presidents. Will they ever succeed?
Justin Fox – Bloomberg
When it came time in 1787 to set the rules for choosing a president of the U.S., three of the principal authors of the Constitution — James Madison, Gouverneur Morris and James Wilson — argued that the best approach, the one most likely to inspire public confidence and national feeling, would be a nationwide popular vote.
China Is Getting Ready for a World Without Trump; By removing two key crutches for the yuan, the central bank is preparing for a less volatile world.
Shuli Ren – Bloomberg
In less than a month, two unusual things happened at the People’s Bank of China. First, it no longer required banks to set aside cash if clients wanted to short the yuan. This makes betting against the currency cheaper, and allows room for the yuan to weaken. Second, the PBOC removed the so-called counter-cyclical factor, one of the three elements used to determine its daily currency fix, which guides trading. These significant tools were set up in 2015 and 2017 to stem the yuan’s free fall.
Boris Johnson Needs a Major Lesson in Empathy; The prime minister seems to have a tin ear when it comes to combining strength with empathy.
Martin Ivens – Bloomberg
In “The Godfather,” the book that inspired a generation of corporate boardroom warriors, Michael Corleone dismisses his trusted friend Tom Hagen as an adviser to his mafia family. “Mike, why am I out?” the mystified Hagen asks. “You’re not a wartime consigliere,” Corleone responds. U.K. Prime Minister Boris Johnson has the opposite problem. In Dominic Cummings, his chief of staff, he has the ideal “wartime” strategist for elections and campaigns. But what he needs now is a peacetime consigliere who understands how to be a conciliator — or at least someone who can speak softly while carrying a big stick. To achieve that balance, however, Johnson himself needs to understand what is at stake. The corona pandemic is undermining confidence in his ability to lead.
Biden, Iran, and Oil Prices: How the Puzzle Pieces Might Fit Together; If Biden wins and eases sanctions, Iranian oil could swamp the world market.
Peter Coy – Bloomberg
Oil prices have sunk back to their lowest levels since the novel coronavirus lockdown in the spring (when, bizarrely, the price of West Texas Intermediate crude briefly touched negative $37.63 a barrel). The pandemic is still weighing on the oil market, but now there seems to be an additional factor: the increasing likelihood that former Vice President Joe Biden will be elected U.S. president and ease sanctions on Iran.
Trump’s Dismissal of Covid Risk Paved Way to White House Outbreak; Virus infections among White House staff escalated as the president looked past the dangers.
Jennifer Jacobs – Bloomberg
In public he was dismissive and belittling of the virus, and those who feared it. In private, for all his bravado, he acted like a man who dreaded catching it. He told his then-chief of staff, Mick Mulvaney, to “stay the hell home” from a trip to India in February because he didn’t want to be around Mulvaney and his lingering cough, according to people familiar with the trip. Even before the virus, Trump was known to dart to the other side of the room if someone sneezed. He used medical wipes labeled “not for use on skin” to scrub his hands, along with the ever-present Purell.
‘Fire Fauci’ Chant Erupts at Trump Rally as Tensions Simmer
Mario Parker and Josh Wingrove – Bloomberg
Trump tells crowd that he appreciated the advice after chant; Trump has repeatedly criticized, marginalized NIAID director
A “Fire Fauci” chant erupted at one of President Donald Trump’s campaign rallies, with the president quipping that he’d wait until after the election if he were to do anything. The chant, which started shortly after midnight Monday morning, was the latest development in Trump’s ongoing critique of Anthony Fauci, the director of the National Institute of Allergy and Infectious Diseases, who was once a prominent figure in Trump’s coronavirus response but who has since been marginalized.
Trump suggests he might try to fire Fauci post-election
U.S. President Donald Trump suggested early on Monday that he might seek to fire a highly respected member of his coronavirus task force, Anthony Fauci, after Fauci further criticized Trump’s handling of the virus.
Nigel Farage tries to harness COVID lockdown anger to take on PM Johnson
Nigel Farage, the British politician who helped force a Brexit referendum and successfully campaigned to leave the European Union, will fight Prime Minister Boris Johnson’s COVID-19 lockdown by recasting his small Brexit Party as Reform UK.
With Biden bets and Trump hedges, investors prepare for U.S. Election Day
Lewis Krauskopf, Maiya Keidan – Reuters
Four years after Donald Trump’s surprise presidential victory roiled markets, investors are prepared for short-term trading turmoil and major long-term policy shifts, on the eve of Tuesday’s U.S. election. Investors could confront dramatically different paths for the country on taxes, government spending, trade and regulation depending on who wins the White House, the Republican Trump or Democratic former Vice President Joe Biden.
Scott Atlas apologizes for interview with Kremlin-backed RT; The White House coronavirus adviser said he didn’t know the outlet is a registered foreign agent.
Nolan D. McCaskill – Politico
Scott Atlas, a White House policy adviser on the coronavirus, apologized on Sunday for “allowing myself to be taken advantage of” by a Russian media outlet backed by the Kremlin.
The Story of Our Mad King Will Live on Well Past the Election; Donald Trump is now an intrinsic part of the narrative of America.
Thomas Wright – The Atlantic
Donald Trump will never really go away, even if he is resoundingly defeated on Tuesday. Not on November 4, not on January 20, not when he dies, not in a hundred years. He may well be what future generations remember most about our era. Not because of what he accomplished, but because the story of a mad king is an immortal tale.
Big Business and Wall Street aren’t afraid of Joe Biden
Julia Horowitz, CNN Business
Corporate America has reaped the benefits of a Trump presidency that produced lower taxes and regulations. But Wall Street and business leaders are just fine with former Vice President Joe Biden, with some prioritizing a steady set of hands after the turmoil of the Trump era.
The Apple-Google Deal Is an Elephant in Both Rooms; Companies avoid discussing search arrangement that is now in regulators’ crosshairs
Dan Gallagher – WSJ
Apple Inc. AAPL -5.60% and Google have never been wild about discussing their arrangement over web search. At some point, they may have no choice. The Justice Department formally unveiled its long-brewing case against Google on Oct. 20. A key focus is the deals the internet giant strikes with device makers such as Apple to ensure prominent placement of its search engine. Those deals account for a large portion of the traffic-acquisition costs paid out by parent company Alphabet Inc., GOOG 3.43% which now total more than $30 billion a year and have grown at a rate of 18% annually during the past five years.
Monetary Authority Of Singapore Bans Two Individuals For Fraud And Dishonest Conduct
The Monetary Authority of Singapore (MAS) has issued prohibition orders (POs) against two former bank employees for fraud and dishonest conduct. The individuals are:
FCA to announce further proposals to support consumer credit borrowers impacted by coronavirus
We said we would keep our support for consumer credit borrowers under review as the coronavirus (Covid-19) pandemic evolved. Following the announcement of the latest Government restrictions in response to the coronavirus outbreak, we will propose updates to our temporary guidance on personal loans, credit cards, motor finance, rent to own, buy-now pay-later, pawnbroking and high-cost short-term credit to support consumer credit customers financially affected by coronavirus.
Deference and Comity: CFTC Approves Cross-Border Swaps Final Rule
Stephen M. Humenik, Yuki Sako, Melissa Tuarez Herr, Kimmi H. Pham, Edgar Mkrtchian – K&L Gates
The Commodity Futures Trading Commission (CFTC or Commission) recently voted 3 – 2 to approve a final rule (Final Rule) on the cross-border application of certain swap provisions under the Commodity Exchange Act (CEA).1 The Final Rule adopts a risk-based approach to the cross-border application of the CEA’s swap provisions while also deferring substantially to foreign regulators. The Final Rule was published in the Federal Register on 14 September 2020 and will become effective on 13 November 2020.2 When publishing the Final Rule, the CFTC noted that “[t]he Final Rule supports a cross-border framework that promotes the integrity, resilience, and vibrancy of the swap market while furthering the important policy goals of the Dodd-Frank Act.”3 The CFTC also expressed its intent that the Final Rule provide a “critical measure of regulatory certainty for the global swaps markets” and represent a “sensible and principled approach to addressing when foreign transactions should fall within the CFTC’s swap entity registration and related requirements.”
Convicted Libor Trader Hayes to Be Released From Jail in January
Ellen Milligan – Bloomberg
Ex-trader Tom Hayes will be released Jan. 29 after conviction
Hayes was first to be convicted of rigging Libor in 2015;Tom Hayes was found guilty of rigging Libor in 2015.
Tom Hayes, the former UBS Group AG and Citigroup Inc. trader convicted of rigging Libor, will be released from prison in January after more than five years. Hayes was the highest-profile conviction in the Libor-fixing scandal. He was found guilty by a London jury in 2015, and is being released after serving about half of his 11-year sentence. U.K. law requires most convicted criminals to serve only about half of their sentence.
Broker-Dealer, Investment Adviser Firm, Agent and Investment Adviser Representative, and Branch Renewals for 2021; Payment Deadline: December 14, 2020
The 2021 Renewal Program begins on November 16, 2020, when FINRA makes the Preliminary Statements available to all firms in E-Bill. Preliminary Statements are not mailed to firms.
Investing and Trading
Mortgage IPO Boom Faces Market Turbulence; Nonbank lenders have had a strong year, but October’s market shakeout could stall the fundraising train
Orla McCaffrey – WSJ
Mortgage lenders hoping to take advantage of a surprisingly prosperous year are facing a big challenge: rising market turbulence.
October Selloff Leaves Few Places to Hide; The formula that had been working so well to sustain investment gains is breaking down as threats to the global economy grow and policies become less effective.
Mohamed A. El-Erian – Bloomberg
That October proved tough for stocks won’t come as a surprise to seasoned investors who still remember some quite challenging months in the past. What is notable this time around, however, is that investments meant to mitigate risks and offset some of the declines from equities also lost money. Understanding why illustrates some of the difficult challenges facing investors in a market greatly distorted by prolonged central bank intervention, and now dealing with weakening economic fundamentals and delayed fiscal policy support.
The Bond Market Is Turning, Blue Wave or Not; The U.S. election isn’t the only drama that should concern the financial world this week.
John Authers – Bloomberg
How was the play, Mrs. Lincoln?
This newsletter may well read like a long attempt to console Mrs. Lincoln and take her mind off the horrors of American politics by asking her about the play she’s just seen. But at the beginning of a week that will be dominated by U.S. political drama like none in decades, it is necessary to remember that many other momentous trends are playing out around the world.
Iconic Restaurant Chain Friendly’s Files for Bankruptcy
Andrew Monahan and Eduard Gismatullin – Bloomberg
Ice cream eatery estimated liabilities of up to $100 million; Chain operator had previously entered bankruptcy in 2011
Friendly’s Restaurants LLC, an iconic chain on the East Coast of the U.S. known for its sundaes, became the latest dining institution to go bankrupt amid the pandemic. The company filed for Chapter 11 protection in Delaware on Sunday, according to a filing. It listed estimated liabilities of $50 million to $100 million, and estimated assets of $1 million to $10 million.
Fed Turns Attention to Asset Purchases After Spelling Out Low-Rate Pledges; Officials prefer more direct spending but see room to provide more stimulus by shifting Treasury purchases
Nick Timiraos – WSJ
Federal Reserve officials at their meeting in September reinforced Chairman Jerome Powell’s statement that they weren’t even “thinking about thinking about raising interest rates.” By contrast, they offered little to guide expectations around their monthly purchases of $120 billion in Treasury and mortgage securities.
Opinion: What should a smart investor do now?
Paul A. Merriman – MarketWatch
I’ve been getting some questions lately that make me think investors are unusually nervous and don’t know what to do. There’s a sense that we are on the brink of some monumental change — obviously related to the presidential election — that will have huge implications.
EY wins more blue-chip audits despite Wirecard fiasco; Big Four firm was sharply criticised for failing to spot a EUR1.9bn fraud at German payments group
Olaf Storbeck and Joe Miller – FT
EY has increased its number of multinational audit clients in Germany despite the high-profile collapse of Wirecard that saw the firm sharply criticised for failing to spot a EUR1.9bn fraud.
People are spending over three times more money ‘gambling’ on hot stocks than at casinos and on lottery tickets and sports betting
Mark Hulbert – Yahoo Finance
Like Claude Rains’ character in the classic film “Casablanca,” would you be shocked to discover that a lot of gambling goes on in the stock market? According to just-completed research, gambling in the stock market is far more prevalent than previously imagined. The study’s authors — all finance academics — calculate that the dollar value of the gambling is at least three-and-one-half times the combined global total of activities at casinos, online gambling, gaming machines, bingo/keno, lotteries, horse tracks and sports betting.
Speculators’ Bullish U.S. Stock Bets Are Near Two-Year High
Gregor Stuart Hunter – Bloomberg
More optimistic positioning followed a slide in the S&P 500; U.S. election and aftermath are set to test fast-money bets
Speculative investors boosted bullish wagers on the U.S. stock market to the highest level in almost two years, a sign that some saw the potential for the S&P 500 index to bounce back from a two-month slump. Net long positions in S&P 500 e-mini futures in the week to Oct. 27 were the most since January 2019, Commodity Futures Trading Commission data show.
Environmental, Social and Corporate Governance
Law-Firm Clients Demand More Black Attorneys; Microsoft, Uber and U.S. Bancorp are among the companies urging law firms to enlist diverse legal teams
Sara Randazzo – WSJ
Law firms have spent years promising to hire and promote more Black lawyers. Their corporate clients are now pressuring them to show results. Companies including Microsoft Corp. , U.S. Bancorp, Uber Technologies Inc. and Intel Corp. are asking the law firms they hire to detail how many diverse lawyers they employ and whether those lawyers are assigned meaningful work. Firms that don’t have good answers might lose out on bonuses or not get hired.
Australia Risks Economic Hit on Climate Inaction, Deloitte Says
James Thornhill – Bloomberg
Country seen at risk of A$3.4 trillion climate hit out to 2070; Embracing low-carbon future would boost growth, report says
Australia’s economy could contract by 6% over the next five decades if climate change goes unchecked, according to Deloitte Access Economics.
The World’s Courtrooms Could Unleash the Next Wave of Green Investing; Pension-fund trial highlights new legal fights over climate change
Matthew Burgess – Bloomberg
The legal risk for pension funds that fail to account for climate change in portfolio investments is about to become a little clearer. While activists and investors around the world are using courts to push government officials and company executives to cut emissions, a trial set to start Monday in Australia offers an early test of whether money managers have a fiduciary duty to help combat the ravages of a warmer planet.
$41 Billion Pension Fund Settles Australian Climate Change Lawsuit
Matthew Burgess – Bloomberg
Sydney-based Rest commits to net zero emissions by 2050; Case may spur similar litigation globally on climate risk
A $41 billion pension fund sued in Australia over its disclosure of climate change risks settled the lawsuit on Monday with a commitment to net zero emissions in its portfolio by 2050 — a case that may spur more litigation around the world.
China Proposes Max $4,500 Fine for Carbon Market Violations
China’s top environmental regulator is proposing a maximum fine of 30,000 yuan ($4,500) for participants in the country’s new national carbon market that don’t buy enough allowances to cover their greenhouse gas emissions.
Europe’s Biggest Fund Managers Ride the Passive Wave; Exchange-traded funds continue to attract inflows in a difficult market environment for money management firms.
Mark Gilbert – Bloomberg
The failure of active fund managers to beat their benchmarks during this year’s fervid markets reinforces the argument that many investors would be better off buying low-cost index tracking funds. That backdrop is providing a handy boost to asset management firms that have built a stable of passive products, with DWS Group GmbH and Amundi SA reaping the benefits of having healthy exchange-traded funds businesses.
World’s Top Hedge Fund Soars 275% With Bets on China Schools
David Ramli – Bloomberg
Singapore’s QQQ Capital’s wagers on Tal Education, GSX pay off; Recent slump by school stocks shows risk of concentrated bets
Long before he ran the world’s best-performing hedge fund, Qian Yongqiang chaired China’s biggest online dating service. The Yale graduate would spend hours tracking down attractive users with suspicious profiles, sifting through accounts and deleting thousands of scammers to improve the site’s authenticity and ensure its success.
He’s outperformed all other hedge funds so far this year, but now he’s got most of his portfolio in cash
Shawn Langlois – Bloomberg
Just a few years ago, Qian Yongqiang was running his own money. Now, after riding a wave of big wins in the stock market, his explosive hedge-fund finds itself on the top of the world and sitting on a wad of cash ahead of next week’s U.S. election. No doubt, it’s been a stellar year for Qian’s QQQ Capital Management hedge fund , which has navigated all the coronavirus volatility to post a 275% return for investors through September.
The next bear market will be the worst in at least 78 years, warns co-founder of Soros’s legendary Quantum Fund
Shawn Langlois – MarketWatch
‘It’s good to be old. Young people have a very bleak future ahead of them.’ That’s Jim Rogers, the 78-year-old co-founder of George Soros’s Quantum Fund, once again hammering home the idea that the flood of money flowing from central banks are artificially keeping markets around the world afloat and will ultimately lead to disaster.
The Only Consensus on Wall Street Is Tuesday’s Election Will Be Felt for Years to Come; Many money managers and strategists are reluctant to project confidence after being caught off guard by a number of market-jolting shocks
Akane Otani – WSJ
Jim Baird remembers sitting on his couch four years ago watching election results stream in. At first, all was calm. Then Donald Trump unexpectedly seized the lead—sending Dow futures and overseas markets careening overnight. Mr. Baird grabbed his laptop to draft a memo to his clients. He didn’t go to sleep until 5 a.m. By 8 a.m., he was back in the office.
Investors find a novel way to hedge their portfolios: hedge funds; High bond prices mean fixed income has lost its lustre as a ballast against stock falls
Laurence Fletcher and Katie Martin – FT
Investors looking for alternatives to highly priced bonds as a way of hedging falls in their equity portfolios have alighted on a novel option — macro hedge funds.
The virus has crushed the challenger bank dream; The idea that the likes of Monzo and Revolut can do anything banks can do but better is crumbling.
Jemima Kelly – FT
There comes a time in your life that you realise that some of the friends you used to consider good friends aren’t actually your true friends. These are your party friends. They’re great in the good times, but they lose their charm, or function, when something bad or life-altering happens to you (like losing a loved one or getting seriously ill, for instance).
Stanford endowment chief applies ballet discipline to investment; Former professional dancer says too much diversification hinders performance
Aziza Kasumov – FT
Robert Wallace decided to pursue ballet after he saw the legendary Mikhail Baryshnikov perform at Washington’s Kennedy Center. “I was 13 and the only boy surrounded by teenage girls,” Mr Wallace recalls of his early days in the dance studio. “I later told this story to David Swensen (endowment chief) at Yale, and he said, ‘That was your most important lesson in supply and demand.'”
A Young Beauty in China Could Turn Investors’ Heads; Chinese cosmetics haven’t been on investors’ radar, but some young challengers are starting to shake things up
Jacky Wong – WSJ
China is well known as a buyer of cosmetics but not so much as a seller. That is changing, however, faster than most investors probably realize.
China says will safeguard Chinese journalists’ rights after U.S. visa rule
China’s foreign ministry said on Monday it will take all necessary measures to protect Chinese journalists in response to the United States delaying visa renewals for Chinese reporters.
Wealthy New Yorkers regret leaving the city? What a surprise
Erum Salam – The Guardian
The pandemic has been hard on everyone, but it has been particularly difficult for wealthy New Yorkers. Like when they had to leave the city in droves, after the pandemic hit and they shortly realized the catastrophic setbacks in quality of life they would have to endure (like when Whole Foods started closing two hours early).
Container shortage exposes India’s struggle to recover from virus; Rebound in exports but a dramatic fall in imports results in ‘considerable imbalance’
Stephanie Findlay – FT
India’s coronavirus lockdown has led to a crippling shortage of containers that is hurting exporters, who are battling to take advantage of economic recoveries in other countries. Prices of shipping containers to destinations such as the US and Africa have more than doubled and there is a three-week backlog to secure a booking at some Indian ports, said exporters.
Japan rethinks its opposition to hostile takeovers; Looming Nitori bid for Shimachu could reshape the landscape for M&A
Leo Lewis – FT
In a crowded field, the discount furnishings group Nitori can make a fair claim to having Japan’s catchiest advertising jingle: eight lilting notes and a cheeky assurance that you get something more than the price you pay.
China Plans to Import More Oil as Glut Pressures Prices
Alfred Cang – Bloomberg
China increases 2021 private firms import quota by 823k b/d; Zhejiang Petrochemical started up one of its new 200k b/d CDUs
A sharp drop in oil prices may be about to get some relief from China. Against a backdrop of sagging demand and signs of growing supply, the world’s biggest oil buyer raised the quota for use of overseas oil by non-state entities next year by more than 20% versus 2020, according to an announcement from the Ministry of Commerce earlier Monday.
A Goldman Sachs Partner’s Odyssey From Karachi to Wooing America
Sridhar Natarajan -Bloomberg
Bank is pinning growth of its Marcus business on a new boss; His mission: Persuade consumers to embrace Goldman Sachs
Omer Ismail knows some people can’t believe he was chosen to sell America on Goldman Sachs. He talks of his first years in the U.S. as a Muslim man from Pakistan after the Sept. 11 attacks — learning firsthand about strangers who look askance at people who look or sound like him. He keeps reminders in his desk, like a news clipping raising alarm about a link between his hometown and a plot to bomb Times Square. The headline blares: “THE KARACHI CONNECTION.”
How to Prepare Your Post-Brexit Finances; Financial advisers say Britons can do more than simply diversify their investments before the transition period ends on Dec. 31.
Charlie Wells – Bloomberg
The posters cut right to the chase. Plastered across the U.K. this autumn, their four words offer passersby a stark warning: time is running out. The new campaign is aimed at getting businesses to prepare for the end of Britain’s transition period with the European Union on Dec. 31. But time is also running short for Britons themselves — already burdened by the economic impacts of Covid-19 — seeking to prepare their own balance sheets for a potentially turbulent departure.
Brexit talks go into another week as EU, UK push to salvage trade deal
Gabriela Baczynska – Reuters
EU and British Brexit negotiators will continue talks in Brussels on Monday and until around mid-week, sources on both sides said on Sunday, in a sign both sides are still pushing to avoid a damaging breakdown in trade in less than nine weeks.
Chips are down: Brexit uncertainty causing Scottish potato crisis
Lisa O’Carroll – The Guardian
Scottish potato farmers have said that uncertainty surrounding their ability to sell to Northern Ireland post-Brexit is causing millions of pounds in losses, prompting Scotland’s environment minister to accuse the government of treating the industry as “expendable” in trade talks.
While fisheries in Scotland have been treated as a priority in Brexit talks, Scottish seed potato farmers – one of the biggest exporters for the production of chips and crisps in the world – have been told they will be unlikely to be able to export to Northern Ireland from 1 January as things stand.
Brexit Negotiators Move Close to Breaking Impasse Over Fish
Ian Wishart – Bloomberg
U.K. and European Union officials are zeroing in on a solution to break the eight-month deadlock over one of the biggest obstacles to their planned trade deal. In a sign that an agreement could be struck by the mid-November deadline set by both sides, a compromise is emerging on the issue of what access EU boats will have to U.K. fishing waters, according to two people with knowledge of the EU side of the discussions.
Brexit talks go into another week as EU, UK push to salvage trade deal
Gabriela Baczynska – Reuters
EU and British Brexit negotiators will continue talks in Brussels on Monday and until around mid-week, sources on both sides said on Sunday, in a sign both sides are still pushing to avoid a damaging breakdown in trade in less than nine weeks. Intensive and secretive, the talks are a final bid to seal a new partnership agreement for when Britain’s transition out of the European Union runs its course at the end of this year.
UK’s Farage tries to harness COVID lockdown anger to take on PM Johnson
Guy Faulconbridge – Reuters
Nigel Farage, the British politician who helped force a Brexit referendum and successfully campaigned to leave the European Union, will fight Prime Minister Boris Johnson’s COVID-19 lockdown by recasting his small Brexit Party as Reform UK.
Cast by his supporters as the godfather of Brexit, Farage said Johnson had terrified the United Kingdom into submission over COVID-19 and squandered vast amounts of taxpayers’ money while holding out hopes of a “miraculous” vaccine.
Why Business Associates May Trust You—or Not—Based on Your Looks; New study finds a bias toward people with traditionally trustworthy facial features in business
Alina Dizik – WSJ
Earning the trust of your business associates may be easier if you look the part—whether you deserve their confidence or not. That’s the finding of a recent study published in the Journal of Accounting and Economics earlier this year that looked at how facial features affect business judgment. It found that traditionally trustworthy features can win over people in new professional relationships—but those positive assessments often turn out to be misleading.
How to Keep Climbing the Ladder While You Work From Home; Plenty of offices will be empty until well into 2021, so there’s no time like the present to seek feedback from the boss and brush up on your skills.
Julie Wee – NY Times
You’re stuck working from home, but does your career need to be stuck, too? Worried about keeping employees safe, many companies are pushing return-to-office dates deep into next year, so workers face more months toiling from spare bedrooms and kitchen tables.
The New Rules for Networking in the Pandemic; With connections more important than ever in uncertain economic times, here is advice from experts on virtual tactics to advance your career when you can’t schmooze in person
Ray A. Smith – WSJ
Maraya Camazine, a third-year medical student at the University of Missouri, had long anticipated schmoozing with others in her field at the big conference of the American Association for the Surgery of Trauma held every September. “Your third year is essentially your last chance to make good impressions on people,” says the 28-year-old. “All of these trauma surgeons go to the same conferences every year, and so as a med student your goal is to find a research mentor, go with them and then meet all of these doctors and be able to sit and discuss next steps in the field.”