Hits & Takes
John Lothian & JLN Staff
Ken Griffin has moved his family to Florida and now is taking his firm, Citadel, with him, according to a multitude of press reports. The stories cite crime in Chicago as the cause of the move to the sunshine state, but one reader pointed out to me that Miami actually has a crime index that is 185 above the national average compared to Chicago’s crime score of 137 above the national average, according to Nextburb. Both are bad, but Miami is no haven from criminal activity.
However, according to the Business Insider story, quoting Citadel’s Zia Ahmed, “Over the last few years there had been an attempted carjacking of Griffin’s car, a stabbing of a Citadel employee while walking to work, shoplifting in the neighborhoods where Citadel employees live, shootings near the homes of some employees, and mass shooting, riots, and looting near Griffin’s home in River North.”
Those are some important data points. Good luck to Griffin and the Citadel team as they move to Florida.
The coverage of this story comes from Business Insider, the Wall Street Journal, Bloomberg, the Chicago Tribune, the Chicago Sun-Times and the Financial Times. There is a second Bloomberg story, this one titled “Ken Griffin’s Citadel Move Is ‘Punch in the Gut’ for Chicago.” Chicago can take a punch in the gut. Heck, this city has been burned to the ground and came back bigger and better than ever.
Griffin has been a major commercial, civic and political asset to Chicago and the State of Illinois and it is a shame to lose him and Citadel. He has been a major benefactor of many causes, let alone he was single-handedly trying to sway the Illinois governor’s race to the Republican side before another billionaire on the Republican side disrupted his plans somewhat.
Griffin will have a new neighbor down in the Palm Beach area, as Oracle Co-Founder Larry Ellison paid a record $173 million for an oceanfront estate that belonged to another tech entrepreneur, Netscape Communications Corp. Co-Founder James Clark. This is the property that Clark bought for just $94.17 million in March of 2021. Clark did improve some of the mechanical systems, but no other changes to the estate were made, so Clark is walking away with a boatload of Oracle money.
The LME announced that Oliver Wyman (supported by its sister company, Nera) has “been appointed to conduct an independent review into events in the nickel market leading up to the nickel market suspension in March.”
DRW wants to help you wake up this morning by sharing their coffee, actually sharing their coffee trading strategy. Let’s just say this is the cream of the crop for coffee trading strategies.
MEMX CEO Jonathan Kellner is interviewed by Citadel’s Head of Business Development Jamil Nazarali in a YouTube video titled “Global Exchange Leaders.” This is a marketing video masquerading as journalism, but nicely done.
I always liked the people from the Boston Consulting Group, or BCG, though I sometimes get confused between BCG and BGC. But BCG posted to LinkedIn yesterday a piece titled “Building an Inclusive Work Culture for LGBTQ+ Employees from Day One” that caught my eye. It sounds like more than the corporate strategy, rather the right thing to do.
NFA is a sparkling example of an organization that does just this. Here are a couple of recent LinkedIn posts from them:
“In support of PRIDE Month, NFA’s Diversity & Inclusion Council hosted an informative discussion where participants shared their journey and discussed how to be a LGBTQ+ ally. Thank you to all of the panel speakers and Mike Otten for moderating.” (Via LinkedIn)
“NFA collected donations and participated in a hygiene kit packing party hosted by the United Way! The kits will be delivered to the Howard Brown Health Center (Chicago) and Ali Fortney Center (New York), which helps support the LGBTQ and the black and brown homeless youth.” (Via LinkedIn)
I was an early adopter of Alexa from Amazon. I signed up ahead of time to get the first generation as a gift for my wife for Mother’s Day many years ago. Now, Alexa is being programmed to use real people’s voices, not just Samuel Jackson swearing here and there. In fact, one feature of the new Alexa is using the voice of dead people, maybe your mother or mother-in-law, as the voice. The next feature I expect to see from Amazon’s Alexa is the hologram that comes with this, just like Obi-Wan Kenobi from Star Wars.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
TT announced a partnership with the digital asset technology provider Talos on June 7, and MarketsMedia has a story (below, in “Crypto”) about how the partnership is helping TT expand into offering its customers cryptocurrency trading “seamlessly alongside traditional securities.” TT had already started offering access to cryptocurrency spot and derivatives markets in 2018, and the Talos deal expands on that. And our second most clicked story yesterday was our interview with TT’s CEO, Keith Todd, talking about the Talos deal and what is next for crypto and TT. ~SR
Once Again, Twitter Is Roasting Matt Damon For His Crypto Ad; The backlash against cryptocurrencies deepens as the market continues to stumble.
Michael Tedder – The Street
January was a much simpler time. It was an era where an Oscar-winning movie star like Matt Damon could star in an expensive advertisement for Crypto.com (CRCW), and the internet would, in a rare moment of unity, decide that was good and cool. Except…(checks notes) that did not turn out to be the case. Damon’s commercial spot for Crypto.com, which debuted in early January in movie theaters and later played during the Super Bowl, was roundly mocked on Twitter (TWTR) – Get Twitter Inc. Report at the time. Half a year later, the value of cryptocurrency and related ephemera such as NFTs have plummeted from what now looks like a peak of $3 trillion dollars in November. The crypto market, in total, has lost more than $2 trillion as of this week, and there’s no sign that the bleeding will stop any time soon.
***** Matt Damon is best roasted slowly over time and low heat, but tastes best with a little mustard.~JJL
This 18-year-old just raked in $700,000 of revenue selling Bored Ape toys — and NFT holders say the physical replicas reinforce their attachment to digital identities.
Phil Rosen – Business Rosen
Even during a crypto bear market when non-fungible token sales are down, the price of one Bored Ape Yacht Club NFT still remains above six figures while Bored Ape holders party at Ape Fest and NFT.NYC this week. But for all the hype around the digital assets, 18-year-old Ricky da Luz discovered how to tap into the space with physical items. A passionate toy designer, he began messaging Bored Ape NFT holders on Twitter, offering to make them toy replicas of their Apes for free.
***** Action hero bored apes sounds like an oxymoron.~JJL
Update on NYSE Closing Auction Depth of Book
Glenda Castaneda-Dawkins and Kevin Tyrrell – NYSE
The NYSE closing auction remains the largest liquidity event in the equities market, with an average notional value traded of more than $20bn per day in the 2nd quarter of 2022. While the auction accounts for nearly 10% of daily trading volume in NYSE-listed S&P 500 securities, there is substantial additional volume that remains unexecuted in each auction. Often, this additional liquidity resides relatively close to the auction execution price. The below charts show the cumulative available liquidity at various price points near the closing auction price for large, mid, and small cap securities during March 2022. We further divided trading activity into distinct trading events: the quarterly rebalance, the quarter-end close, and all other standard trading days. The charts depict the cumulative volume that was available for execution in the closing auction from resting continuous market limit orders and orders directed to the closing auction, expressed as a percentage of each stock’s consolidated average daily volume.
***** Do you want to see some action? The closing auction is where it is at.~JJL
Ukraine Is Fighting the First War Funded by Crypto Philanthropy; Ukraine’s government is using digital assets like nonfungible tokens to help fund the war against Russia
Victoria Vergolina – Bloomberg
Prior to the Russian invasion of Ukraine in February, the Ukrainian government and the country’s crypto community would not have been described as allies. There was skepticism, distrust and even a few police raids on unlicensed crypto exchanges. That shifted with the war: Digital asset leaders in Ukraine are now hailed, by some, as heroes because of their work with the Ukrainian government to finance the war effort. Ukraine’s deputy minister for digital transformation said crypto donations have enabled the army to buy military equipment, and medicine. In this episode, Bloomberg reporter Alastair Marsh discusses his reporting on how Ukraine has been using crypto during the war to support its armies and its population.
****** The war would be so much better if it were being fought by bored apes rather than funded by them.~JJL
Thursday’s Top Three
Our top story Thursday was the OCC press release OCC Board of Directors Appoints Andrej Bolkovic as CEO-Elect. (Andrej Bolkovic was also our MarketsWiki Page of the Day yesterday.) Second was the JLN video interview TT’s Todd Talks Talos, Crypto, What Comes Next and Energizing a Motivated Team. Third was Crypto Is Not Too Big To Fail, Even With Help From FTX, a Bloomberg opinion piece by Lionel Laurent.
26,869 pages; 239,076 edits
Coinbase Rolls Out First Crypto Derivative Amid Slump in Tokens
Olga Kharif – Bloomberg
Coinbase Global Inc. will launch its first crypto derivative product on Monday in the midst of the current crypto winter. Each nano Bitcoin futures contracts (BIT) will represent 1/100th of the token, the biggest US cryptocurrency exchange said in a statement Thursday. The contracts will be accessible for trading only via multiple third-party retail brokers and clearing firms including ABN AMRO and Wedbush.
Ken Griffin’s Citadel ditches Chicago for Miami following crime complaints; Hedge fund is latest US company to depart Illinois in less than two months
Ortenca Aliaj Steff Chávez – FT
Billionaire hedge fund manager Ken Griffin is moving his firm Citadel to Miami from Chicago, following his threats to leave the city over rising crime rates. In an email to employees on Thursday seen by the Financial Times, Griffin described Miami as a “growing metropolis that embodies the American dream” and said he had recently moved there with his family. Citadel Securities, Griffin’s market-making firm, will also relocate in what is expected to be a multiyear process. Corporate relocations out of the Chicago area have been under an intense spotlight recently, with Citadel the third major company to move out of Illinois in less than two months. Boeing announced in May that it will move its headquarters to the Washington area and Caterpillar said this month it will relocate its base near Dallas.
Fintechs face reckoning as easy money dries up; Valuations have collapsed even faster than they climbed, making fresh funding hard to come by
Imani Moise and Siddharth Venkataramakrishnan and Joshua Oliver – FT
As a wave of fintechs rode successive funding rounds to ever-higher valuations over the past five years, Swedish buy now, pay later company Klarna declared its ambition to become the Ryanair, Tesla and Amazon of the sector. But now as central banks raise rates in a fight against surging inflation, Klarna is trying to raise fresh cash at less than half its peak $46bn valuation and fintechs are having to come to terms with a world where expansion can no longer be fuelled by cheap money and business models must be demonstrated by profits.
Cboe’s New Trading Floor Mixes Past & Present; Cboe bucked a few trends when it launched an open outcry trading floor on June 6.
Eugene Grygo – FTF News
With a lot of fanfare earlier this month, Cboe Global MArkets, Inc., a Chicago-based exchanges company that offers trading, clearing, and investment solutions, bucked more than a few trends when it launched a hybrid, open outcry trading floor in “the historic Chicago Board of Trade (CBOT) building” at 141 West Jackson Boulevard. “We are continuing to support open outcry with a new, state-of-the-art trading floor as our customers continue to find utility and value in the trading floor’s price discovery, execution quality, and the deep liquidity provided by our market makers and floor broker,” a Cboe spokesperson tells FTF News. The new trading floor took about a year to actually build.
Tradeweb Launches Spotlight Dealer Diversity Program to Promote Diverse Dealers; New program increases access to diverse dealers throughout the fixed income trading workflow from RFQ to execution and settlement
Tradeweb Markets Inc. (Nasdaq: TW), a leading, global operator of electronic marketplaces for rates, credit, equities and money markets, today announced the launch of its Spotlight Dealer Diversity Program (‘Spotlight Program’), designed to promote diverse dealers on the Tradeweb platform. Tradeweb made the announcement today at the 2022 Fixed Income Leaders Summit in Nashville, TN. Developed collaboratively over the past year with feedback from members of the buy-side and dealer communities, the Spotlight Program supports the advancement of Tradeweb’s diverse dealer community through a combination of individual dealer profiles, direct consultation and other promotion programs designed to bring more visibility to diverse dealers operating in electronic markets. In addition, Tradeweb enhanced its request-for-quote (RFQ) trading workflow to more prominently expose diverse dealer liquidity to Tradeweb’s participating buy-side clients, further strengthening engagement between diverse dealers and buy-side users on the platform.
Crypto’s Liquidity Troubles Are Spreading Across Platforms
Yueqi Yang and Muyao Shen – Bloomberg
A broad-based selloff in digital assets and the collapse of high-profile tokens TerraUSD and Luna have caused ripple effects across the crypto industry. A wave of liquidations triggered fear of contagion risks. Major lenders Celsius Network and Babel Finance have frozen withdrawals, and Three Arrows Capital, a major crypto hedge fund, is facing liquidity troubles that rattled investors.
Coinbase Launches First Crypto Derivatives Product Aimed at Retail Traders
Aoyon Ashraf – Bloomberg
Coinbase Derivatives Exchange, formerly known as FairX, is launching its first crypto derivatives product this month, hoping to attract more retail traders. The CFTC regulated futures exchange will launch its derivatives product, Nano Bitcoin futures (BIT), on June 27, according to a statement sent to CoinDesk. “The crypto derivatives market represents $3T in volume worldwide and we believe that additional product development and accessibility will unlock significant growth,” the statement said.
Coinbase Global Is Launching a Bitcoin Derivative. The Market Is Still Unsteady.
Brian Swint – Barron’s
Coinbase , the exchange for cryptocurrencies, is launching a derivatives product next week in the midst of a meltdown in the market for digital assets. Coinbase Derivatives Exchange, will launch Nano bitcoin futures, its first listed product, on June 27. It will allow investors to buy contracts tied to the future value of one hundredth of a bitcoin. It will be accessible through third-party retail brokers and clearing firms.
SEC chair urges ‘one rule book’ for crypto to avoid gaps in oversight; Gary Gensler seeks to share information with derivatives agency to better regulate digital assets
Stefania Palma and Patrick Jenkins – FT
The chair of the US Securities and Exchange Commission is looking to strike agreements with other financial agencies to prevent cryptocurrency operators from slipping through the cracks of the US’s fragmented regulatory structure. Gary Gensler told the Financial Times he was talking to his counterparts at the Commodity Futures Trading Commission about a formal deal to ensure that trading in digital tokens had adequate safeguards and transparency.
The EU Should Think Hard About Admitting Ukraine; Europe needs to support Ukraine’s future, not promise the impossible.
The Editors – Bloomberg
At a summit in Brussels yesterday, leaders of the European Union’s 27 member states approved Ukraine’s candidacy for membership in the EU. The decision will boost the morale of Ukrainians fighting to defend their democracy. For now, however, it’s less clear that enlargement to Ukraine is in the best interests of Europe as a whole.
China Asks Foreign Business Leaders How to Revive Hong Kong in Rare Move; Agency overseeing Hong Kong held meetings with business groups; City’s economy has been reeling from strict Covid policies
Kari Soo Lindberg, Bruce Einhorn, and Danny Lee – Bloomberg
China asked foreign business chambers in Hong Kong how to revive the isolated financial hub’s economy in unprecedented listening sessions weeks before new leader John Lee takes office, according to multiple people familiar with the matter.
The SPAC Era Comes to a Whimpering End; Newly public companies are getting bought out—for far less money—while blank-check promoters prepare for a more skeptical market.
Bailey Lipschultz and Katherine Burton – Bloomberg
SPACs were one of Wall Street’s hottest trades during the pandemic bull market that finally came to a crashing close in June. Special purpose acquisition companies, also known as blank-check firms, go public without having a business yet. Instead, they’re formed to raise money so that they can buy another, still-private company to be chosen later. SPACs captured the imagination of a lot of ordinary investors who saw them as a way to get in early on promising startups before they went public.
Wall Street Banks Quietly Test Cyber Defense With Treasury’s Aid; Banks, markets are seen being only as safe as weakest links; Wall Street embraces cooperative ethos in cyber fight
Christopher Condon and Craig Torres – Bloomberg
With global tensions rising over Ukraine, the cutthroat competitiveness of the US financial sector is yielding to partnership over the conviction that a cyberattack against even a group of minor banks — or a third-party service provider — could imperil everyone in a highly connected system.
Bill Gates’ purchase of North Dakota farmland has locals ‘livid’: official
Ariel Zilber – NY Post
An entity with ties to billionaire Bill Gates bought 2,100 acres of potato farmland in northern North Dakota — prompting the state’s top prosecutor to intervene after complaints from local residents. Public records cited by AgWeek show that the Gates-linked Red River Trust bought the farmland from the owners of Campbell Farms, a potato farming group that is headquartered in Grafton, North Dakota, which is about 50 miles from the Canadian border.
BNP Paribas industry veteran to join FCA in trading and wholesale conduct policy role; New addition brings 33 years’ experience in investment banking to the FCA, having served at BNP Paribas CIB, Deutsche Bank and NatWest Markets.
Wesley Bray – The Trade
The Financial Conduct Authority (FCA) has appointed Stephan McGoldrick to be responsible for trading and wholesale conduct policy at the firm; effective from 1 September this year. McGoldrick currently serves at BNP Paribas CIB in a GM regulatory affairs role and has been with the bank for just over a year.
Why billionaire Ken Griffin is moving Citadel’s HQ to Miami from Chicago: riots, an employee stabbed, and the attempted hijacking of his own car
Alyson Velati,Dakin Campbell – Business Insider
In a memo to employees on Thursday, Griffin said he was moving $51 billion hedge fund Citadel and market maker Citadel Securities headquarters to Miami, Florida, from its headquarters in Chicago, where it’s been based since 1990. “Many of our Chicago teams have asked to relocate to Miami, New York, and our other offices around the world” over the past year, Griffin said in a letter to employees. Griffin himself has moved to Miami with his family, he said.
Ken Griffin Moving Citadel From Chicago to Miami Following Crime Complaints; Hedge-fund founder has had long-running feud with Illinois Gov. J.B. Pritzker over crime, other issues
John McCormick and Juliet Chung – WSJ
Billionaire Ken Griffin is relocating his hedge-fund firm Citadel from Chicago to Miami, the third major employer to announce the move of a corporate headquarters from Illinois in the past two months. In a letter to employees Thursday, Mr. Griffin said he had personally moved to Florida—a state that doesn’t collect personal income tax—and that his market-making business, Citadel Securities, would also transfer. He wrote that he views Florida as a better corporate environment and though he didn’t specifically cite crime as a factor, company officials said it was a consideration.
Ken Griffin pulling Citadel out of Chicago; Making good on threats, the richest man in Illinois said he is taking his companies to Miami.
David Roeder – Chicago Sun Times
Ken Griffin, the richest Illinoisan, is taking his family, his billions of dollars and his companies and leaving Chicago. He made the announcement Thursday in a memo to employees. Griffin said the headquarters of his Citadel hedge fund and his trading firm, Citadel Securities, will move to Miami, what he called a “vibrant, growing metropolis that embodies the American Dream.” The move is expected to take several years. The firms have more than 1,000 employees in Chicago and while some are expected to remain, how many is unknown. Griffin’s announcement said he has moved his family to Miami. He offered no parting shots at Chicago or Illinois but has been unsparing in his comments about surging downtown-area crime and about local tax and regulatory policies. He has made threats to leave for months.
Ken Griffin Makes Wall Street South in Miami a Reality; Citadel’s arrival cements South Florida’s role in the investment management industry. But it could help price out the people who made the area great.
Jonathan Levin – Bloomberg
Ken Griffin is turning Wall Street South into a reality. After years of speculation, the billionaire supporter of Governor Ron DeSantis of Florida is moving his hedge fund and market-making businesses to Miami from Chicago, cementing the area’s status as an attractive destination for finance and investment jobs.
Ken Griffin’s Citadel Move Is ‘Punch in the Gut’ for Chicago
Shruti Date Singh
Chicago has suffered a series of corporate departures recently, but Ken Griffin leaving the city might sting the most. The hedge fund billionaire said Thursday that he’s moving the home base of Citadel, the financial behemoth he founded in Chicago more than three decades ago, to Miami. Griffin hinted for months that he might make the move, citing the crime rate and political frustrations with leadership in Illinois.
Ken Griffin moving hedge fund headquarters from Chicago to Miami
Robert Channick – Chicago Tribune
Billionaire hedge fund manager Ken Griffin is moving his company’s headquarters from Chicago to Miami. In a note to employees Thursday, Griffin said his investment firm, Citadel, will relocate to new headquarters in Miami’s financial district after more than 30 years in Chicago. Citadel, which has about 1,000 employees in Chicago, will maintain an office in the city, but many are expected to shift with the corporate locus to the Sunshine State, where Griffin, a Florida native, recently moved with his family. “Chicago will continue to be important to the future of Citadel, as many of our colleagues have deep ties to Illinois,” Griffin said in his note. “Over the past year, however, many of our Chicago teams have asked to relocate to Miami, New York and our other offices around the world.”
SocGen accuses Clifford Chance of negligence in £384m gold bullion dispute; SocGen demands compensation from Clifford Chance over gold bullion debacle
James Booth – FN London
Societe Generale has accused Clifford Chance of negligence over its work for the bank in a dispute over £384m-worth of gold bullion. SocGen engaged the Magic Circle law firm in 2008 to pursue Turkish jewellery maker Goldas. The bank claimed Goldas had failed to pay for 15.725 metric tonnes of gold bullion.
Can Crypto’s Richest Man Stand the Cold?; Changpeng Zhao built Binance into the world’s biggest digital currency exchange. Now he faces a looming regulatory crackdown in a brutal crypto winter.
Justina Lee and Max Chafkin – Bloomberg
During the first few months of this year—back when buying digital tokens named after dog memes was still seen, at least in some of the most forward-thinking circles, as a perfectly reasonable way to participate in finance’s bright new future—the cryptocurrency exchange Binance promoted a new, low-risk way to get in on the action. It urged its customers to invest in something called TerraUSD. The token was what’s known in the trade as a “stablecoin,” a type of cryptocurrency that functions a bit like a savings account and promises to always be worth $1. Binance told customers who used its service to buy, sell, and invest in various cryptocurrencies that this particular stablecoin offered something special: the promise of annual returns of almost 20%. TerraUSD, Binance suggested to customers, could be somehow both “safe” and “high yield.”
Big Crypto Rides to the Rescue, for Some
Yueqi Yang – Bloomberg
Crypto is known for celebrating decentralization, but select exchanges and trading houses have built up kingdoms with outsize influence. Current turbulence is providing an opportunity for them to expand their realms — and in some cases determine who survives. First there’s Sam Bankman-Fried, the 30 year-old billionaire who made his fortune through the crypto exchange FTX and the trading firm Alameda Research. In the past week, as a liquidity crunch from the fallout of crypto hedge fund Three Arrows Capital sent shock waves through the market, he doled out credit lines to lending platform BlockFi, which had an unnamed large client failing to meet obligations on a margin loan, as well as Voyager Digital, the crypto broker that disclosed a $660 million potential bad-debt exposure. Alameda is the largest holder of Voyager, and Bankman-Fried is now compared by some to “the new John Pierpont Morgan,” a potential lender of last resort for the industry.
Distressed Crypto Broker Voyager Sets Limits on Withdrawals; Customers are limited to $10,000 a day, 20 transactions; The crypto firm just received financial from Alameda Research
Muyao Shen – Bloomberg
Crypto brokerage firm Voyager Digital Ltd. is limiting customer withdrawals from its platform to $10,000 and to 20 transactions during a 24-hour period. The New York-based firm, which secured $485 million in loans in the past week from Alameda Research to shore up protection for customer assets, announced the limits on its website. The firm secured the funding after disclosing its exposure to the troubled crypto hedge fund Three Arrows Capital Ltd. Voyager is among the crypto platforms that have faced liquidity issues in the wake of this year’s collapse in the prices of cryptocurrencies. Celsius Network and Bable Finance both recently froze withdrawals.
Exchanges Could Be the Next Domino to Fall
Riyad Carey – KAIKO
There has been an endless cycle of bad news in the past couple weeks as the bear market takes hold. As covered in last week’s Deep Dive, Celsius appears to be on the brink of insolvency because of reckless risk management and illiquidity. Most recently, Voyager, a crypto broker which offers (or offered) 9% yield on USDC, revealed that it has $660 million of exposure to Three Arrows Capital, and a request for repayment has not been fulfilled. Thus, Voyager will be taking a $500 million loan from Alameda Ventures, the VC arm of Alameda Research, which was formerly run by FTX CEO Sam Bankman-Fried.
U.S. to send four more long-range rocket launchers to Ukraine in new aid package; The move will double the number of High Mobility Artillery Rocket Systems sent to Ukraine amid that nation’s battle with Russian forces for control of the eastern Donbas region.
Lara Seligman and Kelly Hooper – Politico
The White House will send four additional rocket launchers to Ukraine, as part of a new $450 million package of military assistance, the Department of Defense announced on Thursday. The move will double the number of High Mobility Artillery Rocket Systems sent to Ukraine amid that nation’s battle with Russian forces for control of the eastern Donbas region. “The United States continues to work with its Allies and partners to provide Ukraine with capabilities to meet its evolving battlefield requirements,” acting Pentagon press secretary Todd Breasseale said on Thursday in a news release.
U.S. long-range rocket systems arrive in Ukraine – minister
Ukraine said on Thursday it had received U.S. supplies of High Mobility Artillery Rocket Systems (HIMARS), a powerful long-range weapon system that Kyiv hopes can help turn the tide on Russia’s invasion. Moscow’s forces are advancing in Ukraine’s east in a bid to capture the industrial heartland known as the Donbas where Ukraine fears some of its troops could be encircled in a Russian pincer. “Thank you to my U.S. colleague and friend Defense Secretary Lloyd Austin for these powerful tools! Summer will be hot for Russian occupiers. And the last one for some of them,” Ukrainian Defence Minister Oleksii Reznikov tweeted of the HIMARS delivery.
Nato must show Putin it is serious about defence; We need a credible military capability that can be rapidly deployed to any alliance member in case of attack
Martin Herem – FT
By invading Ukraine, Vladimir Putin has demonstrated beyond all doubt that he is prepared to use military force — including the threat of nuclear weapons — to attain his geostrategic aims. The inevitable conclusion is that for the people of Ukraine, deterrence has not worked. Attacking them was clearly a crazy thing to do, but Putin still went ahead. From now on, only one thing matters: we need to be militarily prepared for any scenario. Strong defence is the only way to change the Russian calculus. In the days and weeks leading up to the invasion, the threat of economic sanctions and diplomatic efforts of Ukraine’s supporters failed to prevent Putin from sending his troops over the border. Russia’s threat to the European security order has led to a new political and military reality, where aggression against Nato allies cannot be ruled out.
Exclusive: Boris Johnson signals UK’s willingness to demine, help export grain from Ukraine
Andrew Macaskill – Reuters
Prime Minister Boris Johnson said on Thursday Britain was willing to assist with demining operations off Ukraine’s southern coast and was considering offering insurance to ships to move millions of tonnes of grain stuck in the country. Russia’s Feb. 24 invasion of Ukraine and blockade of its Black Sea ports has prevented the country, traditionally one of the world’s top food producers, from exporting much of the more than 20 million tonnes of grain stored in its silos. This has helped push food prices to record highs and left tens of millions of people struggling to eat, a crisis which Western officials say could last two years.
Putin is not yet ready to end the Ukraine war. When he is, we must be prepared; It’s vital to avoid a false choice between peace and justice: that only helps the Kremlin. We need terms both sides might accept
Jonathan Powell – The Guardian
We are setting up an entirely false choice over Ukraine that, if pursued, could unnecessarily undermine European unity. Last week a poll for the European Council on Foreign Relations showed two camps in European public opinion emerging: a larger peace camp (35%) that wants to cut and run now, and a smaller justice camp (22%) that wants to push ahead until victory. In fact, if you look at the detail, there are three groups, with the biggest single group (43%) choosing both peace and justice.
Why Ukraine’s Snake Island Is Key to Russia’s War Strategy; The island is key to controlling the Black Sea, where Ukrainian shipments of grain are blockaded.
Snake Island, in the Black Sea, is a key battleground in the Ukraine war. Satellite images show how Russian forces are using the island to strengthen their military capabilities and block ships carrying grain, as Moscow continues its push in eastern Ukraine.
Ukrainian Farmers Harvest Wheat Amid Russian Rockets, Crossfire; While some flee fighting on their land, others press ahead with harvesting. ‘If they start shooting, we’ll run.’
Thomas Grove – WSJ
The wheat on Pavlo Sergienko’s 7,400-acre farm is ready to harvest. He has rented the combine and gathered the extra help he will need. His next hurdle: collecting the crops while Russian rockets rain down on his fields nearly every day. “I don’t know how we’ll get everything done,” Mr. Sergienko said. “And how we’re going to transport the wheat from here—that’s another interesting question.” Russia’s invasion of Ukraine has hit some of the most productive agricultural land in one of the world’s breadbaskets, disrupting supplies and pushing up food prices. Ukraine’s Black Sea ports have been cut off, grain storage facilities have been targeted, and now as harvest season begins, farmers are feeling the heat of relentless fighting.
Russia heads towards default as payment deadline looms; Grace period for $100mn in interest payments ends on Sunday evening
Nikou Asgari and Tommy Stubbington – FT
Russia could default on its foreign debt for the first time this century as the clock ticks down on a pair of overdue interest payments blocked by western sanctions. About $100mn worth of interest on Russian government debt is due to bondholders by Sunday night, the end of a 30-day grace period during which the country must make the payments to avoid defaulting.
Exchanges, OTC and Clearing
OCC board appoints next CEO; Andrej Bolkovic, CEO of Akuna Capital, will join Options Clearing Corporation in October.
Trina MAnnino – Crain’s Chicago Business
The board of directors for Options Clearing Corporation, the world’s largest equity derivatives clearing organization, on Wednesday appointed Andrej Bolkovic, CEO of Chicago-based trading firm Akuna Capital, to be its next chief. The 50-year-old CEO-elect will succeed John P. Davidson who will retire early next year. The two executives will overlap in the fall to carry out a seamless transition.
Euronext helps brokers offer best execution to retail clients
Euronext is helping brokers to offer Best Execution to their retail clients with Best of Book, the Best Execution service dedicated to retail investors’ orders, to ensure a fair trading environment according to MIFID II best execution requirements. European financial markets have seen a strong rise in trading from retail investors since the start of the Covid-19 pandemic, resulting in the emergence of new investor profiles and investment strategies that have considerably and unexpectedly shaken up the trading landscape.
SoftBank’s Masayoshi Son backs Nasdaq listing for Arm despite UK pressure; Billionaire says US share offering for chipmaker still his ‘favourite’ but decision not final
Antoni Slodkowski – FT
SoftBank founder Masayoshi Son said the Nasdaq remained his “favourite” venue for the planned listing of Arm despite an intensive UK lobbying campaign for a London share offering of the British chip designer.
Global Exchange Leaders: Jonathan Kellner, CEO of US MEMX
Citadel Securities – YouTube
It’s less than two years old but already the fastest-growing stock exchange in the US. MEMX CEO Jonathan Kellner explains what makes his exchange so successful.
Record FX Link Volumes Traded on June 16; June ADV is up 193% year-on-year and in recent days, has consistently surpassed $5bn per day
CME Group, the world’s leading derivatives marketplace, today announced that FX Link volume has reached a new, single-day record of 82,900 contracts (representing over $7.2 billion in notional value) on June 16. The prior FX Link daily volume record was 77,146 contracts on March 10, 2020.
CME Group to Launch First-Ever TBA Futures for Mortgage Backed Securities Market on October 3
CME Group, the world’s leading derivatives marketplace, today announced it will expand its suite of long-term interest rate products to offer the first-ever 30-Year Uniform Mortgage-Backed Securities (UMBS) TBA futures contracts on October 3, pending regulatory review.
Enhancements to the Account Management Service UI
This Friday, June 24, the Account Management Service (AMS) user interface will be enhanced as follows for Clearport users:
Risk Management Arrangements in respect of the HKSAR Establishment Day
All markets operated by the Hong Kong Futures Exchange will be closed for business on 1 July
2022, except MSCI Futures and Options1. In order to assure that safeguards are in place against potential market risks that may arise during the aforesaid period when some of the major markets are open, Participants are kindly reminded to adopt the following risk management measures:
Rehearsal on the polling mechanism for cash market contingencies on 12 July 2022
Upon contingency situation(s) happens, it is important that the Exchange can receive direct
feedbacks from Exchange Participants (“EPs”) to facilitate assessment on overall impacts and
consider the appropriate actions. One of the communication channel is through electronic polling.
Publication of JPX Working Paper, Vol.37 “Investigation into effectiveness of maker-taker fees in stock markets using artificial market”
Japan Exchange Group, Inc. (JPX) today published JPX Working Paper, Vol.37 “Investigation into effectiveness of maker-taker fees in stock markets using artificial market”.
Independent Review Selection Oliver Wyman
Following the notification to the market of the LME and LME Clear’s (together the “LME Group”) intention to commission an Independent Review into events in the Nickel market leading up to the Nickel market suspension (LME Notice 22/099 and LME Clear Circular 22-022 dated 4 April 2022), the LME Group has been working to identify and select an experienced independent party. After a rigorous process, the LME Group confirms the appointment of independent management consultancy firm Oliver Wyman Limited (to be supported by its sister company, NERA UK Limited) (“Oliver Wyman”).
Moscow Exchange to hold MOEX Home Talks with Softline founder Igor Borovikov
On June 30, 2022, the Moscow Exchange will hold MOEX Home Talks with Softline founder Igor Borovikov. The meeting will be moderated by Natalia Loginova, Director of Issuer Relations at the Moscow Exchange.
Shanghai International Energy Exchange has released the Circular on Adjusting the Deliverable Crude Stream for Crude Oil Futures
In accordance with the Contract of Crude Oil Futures of Shanghai International Energy Exchange and the Delivery Rules of Shanghai International Energy Exchange (hereinafter referred to as INE), combined with the changes in the crude oil market, INE hereby decides:
Sell side ramps up outsourced trading desk services for still-skeptical buy side; A raft of new entrants are offering outsourced trading services to buy-side firms, anticipating a wave of takeup among larger asset managers, driven by cost and coverage needs. But are they aiming too high?
Max Bowie – Waters Technology
In the fall of 2020, right as the second wave of the Covid-19 pandemic was hitting, Frontier Road opened its doors (virtually) in London. As is true of any startup, the asset manager had to decide whether to buy or build. For Martin Bercetche, the choice was simple: He is running an investment firm that focuses on the niche sector of emerging markets credit; it’s not a tech company, so why not leverage the expertise of an outsourced trading provider?
The financial startups bubble is bursting and pink slips are being handed out. Here are the fintechs that have announced layoffs so far, from Coinbase to Robinhood.
Asia Martin, Kylie Robison, Bianca Chan, Carter Johnson, Alex Nicoll, Fortesa Latifi, Dakin Campbell, Rob Price – Business Insider
America’s tech industry enjoyed an unprecedented boom during the pandemic when Americans turned to their phones like never before to do everything from shopping to online banking. Financial technology startups that help consumers bank, trade or shop online were among the winners. But business is slowing as people increasingly return to their pre-pandemic lives.
The NSA Is Funding Summer Camps to Teach Kids to Be Cyber Pros; A program started in the wake of the Edward Snowden scandal has steadily expanded.
Katrina Manson – Bloomberg
On the second day of summer camp, Ashley Wilsondebriano made a kill switch. The 17-year-old high school student maneuvered a virtual blue button labeled “emergency stop” from a menu bar to nestle inside a gray tab in the middle of her screen. A tap on her laptop’s space bar, and her drone would drop from the air.
Welcome to the bankers’ panopticon; Paranoia over unapproved messaging will only create more problems for regulators.
Craig Coben and Howard Fischer – FT
A spectre is haunting the financial world. Bankers are huddling with lawyers, some careers have been left in tatters, and a flurry of subpoenas have reportedly been issued by the SEC, which might lead to substantial penalties. But this scandal doesn’t involve mis-selling, malfeasance or misappropriation. It arises from mundane messaging. The SEC believes that bankers are conducting business with unauthorized communication tools, such as iMessage or WhatsApp, from personal devices. And that’s a no-no.
Pair of Brand-New Cybersecurity Bills Become Law
The Biden White House continued its efforts to shore up US cyber defenses by signing two bills into law, both with the goal of helping cybersecurity expertise and resources flow freely between federal agencies and down to municipalities in need of resources.
The Cybersecurity Talent Shortage Is a Myth
Ricardo Villadiego – DarkReading
Over 47 million Americans voluntarily quit their jobs in 2021. This unprecedented mass workforce exit was dubbed the “Great Resignation.” Spurred by the COVID-19 pandemic and the long-term trend of workers rethinking their relationships with the labor market, those who quit cited low pay, a lack of advancement opportunities, and feeling disrespected as their top reasons for leaving, according to Pew Research.
NSA Summer Camp Programs Aim to Foster Cybersecurity Careers
Katrina Manson – Bloomberg
On the second day of summer camp, Ashley Wilsondebriano made a kill switch. The 17-year-old high school student maneuvered a virtual blue button labeled “emergency stop” from a menu bar to nestle inside a gray tab in the middle of her screen. A tap on her laptop’s space bar, and her drone would drop from the air.
Hackers Steal $100 Million by Exploiting Crypto’s Weak Link; Harmony has notified authorities and forensic experts; Hackers have stolen more than $1 billion from bridges
Olga Kharif, Sidhartha Shukla, and Emily Nicolle – Bloomberg
Hackers looted about $100 million from a so-called cryptocurrency bridge, again exposing a key vulnerability in the digital-asset ecosystem. Blockchain Harmony said in a tweet that the hack of its Horizon bridge, which lets people swap coins between different blockchains, took place Thursday morning. It has “begun working with national authorities and forensic specialists to identify the culprit and retrieve the stolen funds.”
TT Aims for Crypto, TradFi Integration
Shanny Basar – MarketsMedia
Trading Technologies International, the trading software provider, aims for its clients to eventually be able to trade crypto seamlessly alongside traditional securities through its partnership with Talos, which provides institutional digital asset trading technology.
TT and Talos announced a strategic partnership on 7 June 2022.
Crypto enthusiasts are betting the house on creative destruction; Despite the recent rout, private digital money seems more likely to mutate than die
Gillian Tett – FT
Earlier this year, an Irish company that organises an annual tech conference in Toronto called Collision decided to celebrate cryptocurrency’s “day in the sun”, as the blurb said, by inviting its luminaries to speak. Oops. By the time Collision finally happened this week, 35,000 attendees turned up, but eight of the dozen-odd top crypto speakers suddenly dropped out, citing “family” and “health” reasons. And instead of basking in the sun, crypto enthusiasts were confronting winter. The sector’s market capitalisation has shrunk by $2tn, or 70 per cent, since last November; the bitcoin price has tumbled below $20,000, the terra and luna stable coins have imploded; crypto lenders such as Babel and Celsius have halted withdrawals; and hedge funds like Three Arrows Capital face margin calls.
Are Parents Making a Big Mistake on College Savings?; Parents are increasingly using cryptocurrencies for their kids’ college savings. Is that a good idea?
Brian O’Connell – The Street
Cryptocurrencies have belly-flopped in recent weeks, with prices on Bitcoin and Ethereum — the two most widely-used cryptos — plummeting. Bitcoin has dropped about 50% of its value in the past two months and ethereum has fared worse of late, falling from $4,800 in November 2021 to $985 in June 2022. Simultaneously, a new study shows that U.S. parents continue to pour cryptocurrency assets into household college savings accounts.According to Intelligent, 87% of parents have invested in crypto to pay for kids’ college expenses, while 41% have $10,000 or more in crypto investments in their college funds.
Bitcoin miners sold their entire May harvest: report; Bitcoin miners are finding it extremely hard to continue their operation as the cost of production has exceeded the profit.
Prashant Jha – Cointelegraph
The cryptocurrency market entered a sell-off phase in the first week of June, seeing a market-wide route with the majority of cryptocurrencies falling to a 4-year low. The deteriorating market conditions have also affected Bitcoin (BTC) mining profitability adversely, forcing miners to liquidate their BTC holdings. New data from Arcane research shows that public Bitcoin mining firms sold 100% of their BTC production in May compared to the usual 20-40% earlier. In the first four months of 2022, public BTC mining firms sold 30% of their mined production, which increased 3X folds in May and is expected to rise even further in June.
Explainer-Can crypto holders recoup losses in court?
Jody Godoy – Reuters
A downturn in cryptocurrency prices and crash of one stablecoin has led some investors to try to recover their losses in U.S. court. Here is how cryptocurrency litigation has fared so far and the challenges investors may face. WHO IS BEING SUED? Companies that created cryptocurrencies, exchanges that facilitated their sale, and individuals who promoted them have all been sued.
Almost $4 Billion in Bitcoin Miner Loans Are Coming Under Stress; Loans backed by mining rigs increasingly underwater amid rout; Crypto lenders seen at risk as Bitcoin, machine prices fall
David Pan – Bloomberg
The prolonged slump in Bitcoin is making it more difficult for some miners to repay the up to $4 billion in loans they have backed by their equipment, posing a potential risk to major crypto lenders. A growing number of loans are now underwater, according to analysts, as many of the mining rigs lenders accepted as collateral have now halved in value along with the price of the world’s largest digital token.
Gucci’s first big venture into the DAO space is a $25,000 investment to join NFT marketplace SuperRare
Fran Velasquez, Doreen Wang, and CoinDesk – FORTUNE
The Florence-based company is buying into its first decentralized autonomous organization (DAO) via a new partnership with non-fungible token (NFT) marketplace, SuperRare. Gucci has acquired $25,000 worth of RARE tokens to join the SuperRareDAO. With its buy-in, Gucci is launching the “Vault Art Space,” an exhibition that will include a selection of NFT artworks by 29 artists. “We approached SuperRare for this knowing we could rely on our mutual effort to amplify the vision of this multifaceted group of artists,” Gucci Vault CEO Nicolas Oudinot told CoinDesk. “We were fascinated by SuperRare’s ability to provide [artists] with a platform to showcase their work in an innovative way, one that is built on a sense of community and that enhances interactions and decentralization as key tools to support both artists and collectors.”
Crypto Trading Platform Uphold Exits Venezuela, Cites US Sanctions
Andrés Engler – CoinDesk
Uphold, a platform offering cryptocurrency trading and digital asset debit cards, is closing its Venezuela operation due to “the increasing complexity of complying with U.S. sanctions,” the company said on Thursday. In a statement, the London-based company advised its customers in Venezuela to “remove funds from the platform as soon as possible.” Trading service in the country will be available until July 31, and accounts will be fully restricted as of Sept. 30.
Ebay bets on NFTs with marketplace KnownOrigin acquisition; The e-commerce giant is building its Web3 presence after enabling NFT buying and selling last year.
Maliha Shoaib – Vogue Business
Ebay has acquired NFT marketplace KnownOrigin for an undisclosed sum, marking another major move to capture demand for digital collectibles. UK-based KnownOrigin was set up in 2018 and allows artists and collectors to create, buy and resell NFTs on the Ethereum blockchain. In a statement, Ebay CEO Jamie Iannone said the acquisition would help it to “remain a leading site as our community is increasingly adding digital collectibles”. He said KnownOrigin has built up an “impressive, passionate and loyal group of artists and collectors, making them a perfect addition to our community of sellers and buyers”.
Doodles NFTs hit $500 million in sales and could still weather recession, says CEO who’s tapped Pharrell Williams and Reddit’s Alexis Ohanian to build a Web3 media giant
Phil Rosen – Markets Insider
Since launching last October, Doodles has erupted in popularity to become one of the top non-fungible token collections on the market. Doodles features 10,000 pastel-colored, squiggly drawings living on the ethereum blockchain, with the cheapest one trading at just under $17,000, or about 15 ETH. Newly appointed chief executive Julian Holguin — who just left his post as the president of Billboard — has plans to push the NFTs beyond the $500 million in trading volume they’ve already seen. “We want to create joyful experiences for people no matter what product we create, whether it’s a video game, a profile picture for Instagram, the music you listen to, [or] real-life attractions,” Holguin told Insider during an interview at the NFT.NYC conference Wednesday.
This is what’s standing in the way of DeFi’s ‘NFTification’; NFTs and DeFi have taken the world by storm in recent years, but both industries have downsides. Bringing them together could be a force for good.
Chris Jones – Cointelegraph
In some circles, nonfungible tokens have been dismissed as a vehicle for speculation, with critics lamenting that demand for such assets is fueled by greed. But this argument doesn’t give us the full picture. We’re barely scratching the surface of what these one-of-a-kind tokens can achieve — and new use cases are continually emerging. The music industry is tentatively exploring what NFTs have to offer. Live Nation, one of the world’s biggest entertainment companies, has started offering digital versions of ticket stubs — giving fans a virtual memento of the gigs they’ve attended. Other platforms are allowing consumers to invest in new music and receive a share of the royalties. TV shows and films are being funded through NFTs too — and despite a backlash from players, gaming brands are also dabbling in this technology.
Cristiano Ronaldo signs NFT deal with crypto exchange Binance
Joshua Oliver, Scott Chipolina and Samuel Agini – FT
Cristiano Ronaldo, one of football’s biggest stars, has inked a sponsorship deal with crypto exchange Binance, becoming the latest celebrity to strike a lucrative partnership with a digital asset firm despite the crisis gripping the sector. The legendary Portuguese footballer, whose career has spanned Manchester United, Juventus and Real Madrid, will work with Binance to create a collection of non-fungible tokens (NFTs) that will be sold exclusively by the exchange. Ronaldo’s crypto deal comes as the price of Bitcoin has fallen more than 70 per cent from its peak last autumn, wiping out five years of gains for investors. The sell-off has triggered a crisis for some of the digital asset industry’s largest traders and lenders, prompting warnings of a “Lehman moment” for the sector.
Liz Cheney Encourages Wyoming Democrats to Change Parties to Vote for Her; Ms. Cheney, who faces a Trump-backed challenger, has begun mailing Wyoming Democrats instructions on how to change their party affiliation.
Reid J. Epstein – NY Times
Representative Liz Cheney, a Republican of Wyoming whose polling remains far behind her Trump-endorsed primary challenger as her House committee’s Jan. 6 hearings continue, is urging Democrats in her home state to switch parties to support her in the Aug. 16 primary. In the last week, Wyoming Democrats have received mail from Ms. Cheney’s campaign with specific instructions on how to change their party affiliation to vote for her. Ms. Cheney’s campaign website now has a link to a form for changing parties. Joseph Barbuto, the chairman of the Wyoming Democratic Party, was among those who received Ms. Cheney’s instructions. Mr. Barbuto said that over the last week, his social media feeds have been flooded with Democrats — and only Democrats — posting about receiving mailers from the Cheney campaign.
Beware the Dangers of Sado-Monetarism
Paul Krugman – NY Times
Sado-monetarism is having a moment. And one of the biggest risks now facing the U.S. economy is that it will have too much influence over policy. This term, by the way, was coined by William Keegan to describe Margaret Thatcher’s economic policies. But sado-monetarist has come to mean a person who always seems to demand higher interest rates and fiscal austerity, regardless of the state of the economy.
Olaf Scholz says partnership with Putin’s Russia is ‘inconceivable’; German chancellor pledges new ‘Marshall plan’ for Ukraine after trip to Kyiv and adviser’s controversial comments
Guy Chazan – FT
Olaf Scholz, the German chancellor, has ruled out a return to any kind of normal relationship with Russia in the wake of its war of aggression against Ukraine, as he used a statement to the Bundestag to reiterate Berlin’s support for Kyiv. “Partnership . . . with Putin’s aggressive, imperialist Russia is inconceivable for the foreseeable future,” he told MPs. He was speaking just days after one of his closest advisers, Jens Plötner, made waves by suggesting the media should focus more on Germany’s future relationship with Russia than on supplying Ukraine with heavy weapons. Scholz did not comment on Plötner’s remarks, but he played down the prospects of ever returning to the kind of relationship Germany had with Russia before president Vladimir Putin sent his troops into Ukraine in February.
EU Leaders Brace for Tough Winter as Russia Tightens Gas Grip; Energy security, surge in prices rise to top of EU agenda; Governments to discuss preparedness for gas supply disruptions
Ewa Krukowska, Natalia Drozdiak, and Stephanie Bodoni – Bloomberg
European Union leaders are preparing for a further reduction in gas supplies from Russia, seeking ways to cushion the effects of the unprecedented crisis, as well as a surge in energy prices, on the region’s economy. The impact of Russia’s invasion of Ukraine and its use of energy as a weapon forced its way into a meeting of EU leaders on Friday, after cuts in shipments from Moscow affected 12 member states and pushed Germany to raise its gas-risk level to the second-highest “alarm” phase.
Europe Must Declare a War Economy; As Russia turns off the gas and Germany activates emergency plans, Europeans must become ants to avoid ending up grasshoppers.
Andreas Kluth – Bloomberg
The next step in the conflict between the West and Russian President Vladimir Putin was supposed to be a European boycott on Russian coal, oil and natural gas. It may instead be a gas embargo by Putin on Europe. It comes to much the same. The countries of the European Union must accept what some of them — notably Germany and Austria — spent years denying. It’s that in the eyes of an amoral despot such as Putin, everything is a weapon of war. That includes nuclear and chemical arms, but also wheat, disinformation and, not least, energy.
Russian gas crisis will test EU solidarity, warns German utility RWE; Power provider says rules governing priority supplies must be standardised between countries in case of rationing
Joe Miller, David Sheppard and Nathalie Thomas – FT
EU solidarity will come under severe strain this winter if Russian gas supplies are cut off, the head of German utility RWE has warned, saying there will be “chaos” across the continent unless the bloc acts now to establish rules on energy sharing.
US banks pass latest round of Fed stress tests in sign of financial health; Companies’ hypothetical losses widen but remain within bounds in test of their ability to withstand severe pressure
Joshua Franklin and Colby Smith – FT
The US Federal Reserve on Thursday gave passing grades to all 33 of the country’s biggest banks in annual stress tests, which gauged each lender’s ability to weather a severe economic downturn. In a series of doomsday hypothetical scenarios drafted by the Fed, the banks would collectively lose $612bn, and the group’s capital ratios would decline to 9.7 per cent, more than double the minimum requirement, the Fed said. The banks, which included JPMorgan Chase and Goldman Sachs as well as US subsidiaries of foreign banks such as Credit Suisse, had to show they maintained capital levels above the government-mandated minimums after enduring the scenarios outlined by the Fed in February.
Testimony by Vince McGonagle Director of the Division of Market Oversight before the Subcommittee on Commodity Exchanges, Energy, and Credit House Agriculture Committee, Washington, DC
Chairman Maloney, Ranking Member Fischbach, and Members of the Subcommittee, thank you for the opportunity to appear before you today to share my views on digital asset regulation as the Director of the Division of Market Oversight at the Commodity Futures Trading Commission (CFTC, Agency or Commission).
Diversity & Inclusion Report – 2020 Year in Review
Download the Diversity & Inclusion Report – 2020 Year in Review
FINRA Requests Comment on Proposed Trade Reporting Requirements for Over-The-Counter Options Transactions
FINRA is soliciting comment on a proposal to establish a new trade reporting requirement for transactions in over-the-counter options on securities with terms that are identical or substantially similar to listed options. FINRA is proposing to require firms to report this information to FINRA on a daily basis (end-of-day) for regulatory purposes only.
SEC Adopts Rules to Require Electronic Filing for Investment Advisers and Institutional Investment Managers; Rules and form amendments will enhance efficiency and make data more usable for the public.
The Securities and Exchange Commission today adopted amendments to require certain documents filed by investment advisers, institutional investment managers, and certain other entities to be filed or submitted electronically. The amendments also make technical amendments to modernize Form 13F and enhance the information provided. The amendments are intended to promote efficiency, transparency, and operational resiliency by modernizing how information is filed or submitted to the Commission and disclosed to the public. Electronic filings will be more readily accessible to the public and available on websites in easily searchable formats.
ASIC warns super trustees to be transparent in their underperformance communications to members
ASIC today released the findings from its review of superannuation trustees’ communications with their members following the first annual performance test for MySuper products.
ESAS refer stakeholders to commission statement on the application date of new PRIIPs rules
The European Supervisory Authorities (ESAs) would like to draw the attention of stakeholders to a Statement by the European Commission concerning the application date of new rules for the Key Information Document (KID) for packaged retail and insurance-based investment products (PRIIPs).
What’s New on the FSA Website
Week of June 10, 2022 – June 16, 2022
This page contains the latest in events, developments, and updates to the FSA website.
Annual update to the list of Financial Services Providers under the OTC derivatives regulatory regime
The Hong Kong Monetary Authority (HKMA) and Securities and Futures Commission (SFC) today issued the joint consultation conclusions on the annual update to the list of Financial Services Providers (FSP List) (Note 1) under the over-the-counter (OTC) derivatives clearing regime.
Investing and Trading
Online Day-Trading Guru Says She’s Preaching Caution Ahead of a Recession; Teri Ijeoma, whose “Trade and Travel” course has taught over 28,000 students, says inexperienced traders should stay on the sidelines.
Renita Young – Bloomberg
The recent slump in markets is testing the army of retail investors who started trading during the pandemic. It’s the first bear market many of them have experienced, and will require a different playbook from the “stocks only go up” mantra that worked so well for much of the past two years. Teri Ijeoma, whose popular online courses, including “Trade and Travel,” have taught over 28,000 students the basics of day trading, says she’s predicting a recession and advising students to stay on the sidelines if they haven’t learned advanced strategies like hedging and short-selling.
Our Coffee Trading Strategy
Coffee is a wonderful commodity that ties together very exciting parts of the world. While one of the most popularly traded, it can also be one of the most volatile. At DRW, we’re very fortunate to bring our research and trading experience together and plug into the best in class thought process, dialogue and approach to risk. In this article, we’ll delve into our strategy for trading this commodity.
Europe Is Now in Its Worst Corporate-Bond Selloff in Decades
Abhinav Ramnarayan – Bloomberg
By almost any metric, this is Europe’s worst corporate-bond selloff in decades, surpassing even the 2008 financial crisis. Whether you look at returns, the speed at which yields have risen, or the length of the selloff, investors face a historic pummeling. An index of investment-grade European debt has fallen seven months in a row, its longest losing streak since its inception in 1998. The 12.9% loss over the past 12 months is also the worst in its history.
Markets Are Losing the Anchor of a Generation; Inflation has undermined the credibility of central banks. That explains how bond yields can be rising even as recession fears mount.
John Authers – Bloomberg
I can’t be the only one looking forward to the summer doldrums. Markets have been agitated all of June as sentiment has swung violently toward positioning for stagflation, and then toward a recession that brings down inflation in its wake.
Fees increasingly on the agenda for wealth management clients; Market turmoil adds to clients’ concerns about charges
James Pickford – FT
When Christine Ross inherited a new client from a colleague heading off into retirement, the customer made clear he had only one concern when it came to the question of fees — and it was not about how the wealth manager’s charges stacked up against rivals. “He wanted to know that he did not have an inferior charging structure to any of our other clients with a similar amount invested,” says Ross, client director at Handelsbanken Wealth and Asset Management.
TORA selects former Cabrera Capital Markets block trader for outsourced role; New outsourced trader at TORA previously served at GFI Group, Mirae Asset Global Investment, Bloomberg’s Tradebook, UBS, Citi and Cabrera.
Annabel Smith – The Trade
TORA has selected a former EMEA equity trading specialist from Cabrera Capital Markets for a new outsourced trading role. William Faulkner has joined TORA as an outsourced trader after most recently serving as a equity block trader for EMEA and a sales trader for APAC and EMEA for the last year at Cabrera Capital Markets.
Bloomberg to launch new set of tradable trackers based on own indices; Tradeable Trackers, the new indices set to launch in Q4, are expected to deepen liquidity and improve intraday price transparency.
Wesley Bray – The Trade
Bloomberg has announced the imminent launch of Tradeable Trackers, a new set of tradeable indices based on its own fixed income indices. The new rules-based indices differ from traditional end-of-day ones in that they have intraday pricing available, which reduces tracking errors while also enhancing transparency and price discovery.
Environmental, Social and Corporate Governance
Financial Centers Are Far From Net Zero With Heavy Emitting Listings; Exchanges are helping facilitate ongoing carbon-intensive activities of fossil-fuel companies, according to a report.
Kevin Simauchi – Bloomberg
Stock markets in cities and countries that have pledged to achieve net-zero emissions are including carbon-intensive oil and gas companies capable of overheating the planet, according to a report from UK research nonprofit Carbon Tracker Initiative. Despite financial centers like New York or London setting goals to transition to a low carbon economy, the report’s authors say that stock exchanges “enable” the ongoing activities of fossil fuel companies by facilitating “primary equity raising and ongoing finance requirements.”
Yemen’s Ticking Oil Bomb Threatens the World Economy; A spill from a rusting tanker anchored in the Red Sea would make the 1989 Exxon Valdez disaster look like a beach party.
Bobby Ghosh – Bloomberg
Most of the limited international diplomatic energy devoted to ending the civil war in Yemen understandably goes to preventing the loss of lives, whether from bloodshed or famine. But now that a two-month truce between the belligerents has been extended, urgent action is required to forestall a different kind of calamity: an oil spill that could rank as one of the world’s worst environmental disasters and disrupt a vital global trade route.
Investors welcome HKEX’s support for ESG and digital assets
The regulator pledged to broaden its capabilities in digitalised infrastructure to provide more data and analytics services to issuers and investors.
Shusi He – Asian Investor
The Hong Kong Exchanges and Clearing’s (HKEX) support for sustainable investing and digital assets will help institutional investors in their push forward, but the city must open to maximise the potential of these moves, according to fund managers.
Nasdaq Expands Its ESG Offering With OMX Copenhagen 25 And OMX Helsinki 25 ESG Responsible Indexes
Nasdaq (Nasdaq:NDAQ) today announced the launch of ESG Responsible Indexes for its Danish (Nasdaq Copenhagen: OMXC25ESGTM) and Finnish markets (Nasdaq Helsinki: OMXH25ESGTM) which are based on the benchmark indexes OMX Copenhagen 25TM (OMXC25TM) and OMX Helsinki 25TM (OMXH25TM) and consist of the 25 most traded securities listed on Nasdaq Copenhagen and Helsinki, respectively. The OMX Copenhagen 25 and OMX Helsinki 25 ESG Responsible Indexes are designed to track the performance of a selection of the most traded securities whose issuers meet specific ESG criteria.
Investors ‘keep faith with ESG funds’; Wealth managers say most clients remain committed to greener assets
Harriet Cooke – FT
The recent surge in fossil fuel stocks on the back of the Ukraine war might suggest that investors’ long embrace of climate-friendly companies is starting to cool. But, as far as affluent UK private investors are concerned, that is not the case, say wealth managers. While some clients have reframed their approach to energy investments in the light of the crisis and the jump in oil, gas and coal prices, most remain committed to the net zero agenda and, more broadly, to companies that take account of environmental, social and governance (ESG) values.
Deutsche Bank’s Leadership Takes Financial Hit on Staff Use of WhatsApp; German lender has come under criticism from regulators; Deutsche Bank is rolling out new monitoring technology
Steven Arons – Bloomberg
Deutsche Bank AG’s management board agreed to take a pay cut after criticism from regulators of widespread use of private communication channels among staff via applications such as WhatsApp, according to people familiar with the matter. Top executives are set to see a 75,000 euro ($79,000) cut to bonuses given for last year’s performance that start getting delivered from next year, one of the people said, asking not to be identified discussing a private matter. The lender is among several financial firms under investigation by US authorities over the use of private messaging that can’t be archived. It recently introduced a new app that allows the retrieval of messages on company phones.
Covid vaccines prevented 20mn deaths globally, study finds; Mathematical modelling looked at deaths directly and indirectly linked to jabs
Donato Paolo Mancini – FT
Covid-19 vaccines have prevented an estimated 20mn deaths globally in the first year since their initial deployment, according to a new peer-reviewed study. Researchers at Imperial College London found the vaccines reduced the potential global death toll from Covid-19 by more than half in the same period, they said on Thursday, announcing the results of the study published in The Lancet medical journal. The mathematical modelling study looked at deaths directly and indirectly linked to Covid-19 vaccination, using death records and total excess deaths, or estimates where no official data was available.
Britain is being swamped by yet another Covid wave – how can we stop them coming?; Matt Hancock is wrong to say we are ‘past the pandemic’. And we won’t be until the world’s population is vaccinated
Kit Yates – The Guardian
We are at the beginning of another wave of Covid – the third in six months. Roughly one in 50 people in England are currently infected, while that figure is as high as one in 30 in Scotland. An estimated 1.4 million people in the UK – more than 2% of the population – would have tested positive last week according to the latest Office for National Statistics (ONS) infection survey. Chances are you know someone who’s got the disease. Covid hospitalisations have also been rising for the past couple of weeks. On Monday there were more than 1,000 admissions in England – the first time we’ve reached that level since April.
12 Americans Die of an Overdose Every Hour. We Have the Knowledge to Prevent That.
Jeneen Interlandi – NY Times
For most of his life, Harris Marquesano struggled to live inside his own skin. He was a sweet boy — affectionate with his parents, protective of his little sister and devoted to his friends. But he had more energy than he knew what to do with, and he worried almost constantly. In preschool, when his teacher had to have surgery, he was so distressed by her absence that he tried to take over his classroom, presiding over each playgroup like a tiny, anxious general. By junior high, he was acting out in earnest. Some of Harris’s teachers suggested to his mother, Stephanie Marquesano, that he was just testing limits. But she knew it was more than that. “He was crawling out of his own skin half the time,” she said. “Running around and acting out was the only way for him to manage that feeling.”
Covid infections rise 20% in England as new Omicron variants spread; Scotland hit hardest in the UK as cases climb 40% to leave one in 20 people suffering from the disease
Clive Cookson – FT
Covid-19 infections continue to surge across the UK, with the number of people in England estimated to have the virus jumping 20 per cent to 1.3mn in the past week, according to the latest official survey. The rapid spread of infections is driven by new Omicron subvariants and has raised the virus’s prevalence in the population to the highest level since April 2022, the weekly survey by the Office for National Statistics showed.
IMF Warns of Risks From China’s Slowing Covid Vaccination Rates; Vaccination with three doses to take “years” at current pace; Fiscal support still less than 2020, mission chief says
Tom Hancock – Bloomberg
The International Monetary Fund called on China to accelerate its coronavirus vaccination program, warning the sharply slowing pace of new doses administered could undermine a recovery in consumer spending in the economy. At the current pace, providing three doses of Covid vaccines to the population would take a “matter of years,” Helge Berger, head of the IMF’s China mission, said in an interview. With spending growth yet to recover to pre-pandemic rates, partly because households are cautious about Covid infections, “an acceleration of the vaccination campaign would support confidence and ultimately consumption,” he said.
BoJ Releases Report on JPY LIBOR Transition; In May 2022, the Bank of Japan published its “Review of JPY LIBOR Transition Response and Future Initiatives”.
This report is a review of the publication of Yen LIBOR, which was suspended at the end of December 2021, and a summary of future efforts, particularly with regard to the establishment of alternative benchmarks to replace LIBOR and the transition away from USD LIBOR, which is scheduled to be suspended in June 2023.
U.S. Gas Sales to China Dry Up as Ukraine War Disrupts Energy Trade; In a redirection of flows, America sells more to Europe, while Russia becomes more dependent on sales to Beijing
Brian Spegele and Sha Hua – WSJ
This time last year, China was racing to buy as much natural gas from the U.S. as it could get. After Russia invaded Ukraine, those purchases all but dried up, and China is now buying more from Russia. The U.S.-China energy trade had until recently been one area of deepening ties in an otherwise fractious relationship. Large energy sales were a central part of the Trump administration’s trade deal with China. China’s imports of liquefied natural gas, or LNG, in particular offered a concrete example for Beijing to show how the country’s growing economy helped create U.S. jobs. The invasion of Ukraine has halted that for now. After Russia attacked, Europe pledged to cut Russian gas imports in response. LNG from the U.S. was one of the few alternatives available to European countries as they scrambled to fill the gap, causing prices to surge to record highs.
China approves ICBC-Goldman JV to start offering wealth services
Industrial and Commercial Bank of China (ICBC) said on Friday its wealth management joint venture with Goldman Sachs Group Inc had received the country’s banking regulator’s approval to begin operations. The China Banking and Insurance Regulatory Commission’s (CBIRC) nod comes as the world’s second-largest economy opens up its giant financial sector to investments from foreign players, allowing them to collaborate with domestic banks.
Germany looking at repurposing unused Nord Stream 2 pipeline for LNG use -report
The German government is considering converting parts of the Nord Stream 2 gas pipeline into a connection for a liquefied natural gas terminal on the Baltic Sea coast. Magazine Der Spiegel reported on Friday that the German economy ministry is considering expropriating the part of the pipeline system located on German territory and cutting it off from the rest of the pipeline. The report did not cite any sources.
Billionaire Larry Ellison Buys $173 Million Estate, Setting Florida Record; The billionaire co-founder of Oracle was behind the biggest residential purchase in the Sunshine State.
Jennifer Epstein – Bloomberg
Larry Ellison added a $173 million oceanfront estate in Palm Beach County to his sprawling residential real estate portfolio, setting a record for the most expensive residential sale in Florida. The billionaire Oracle Corp. co-founder closed on the property, just south of Palm Beach in Manalapan, last week, according to public documents. The seller was another tech entrepreneur, Netscape Communications Corp. co-founder James Clark. The estate includes a Mediterranean-style main house of more than 62,000 square feet (5,760 square meters) and several other buildings, which together have more than 30 bedrooms.
Launching a Podcast for Your Business? 10 Essential Things You Need to Know First; A podcast can be an excellent opportunity to gain recognition for your brand if you do it right.
Rolling Stone Culture Council
It seems that there’s a podcast for every subject or interest nowadays, from true crime to financial advice to entrepreneurship. This medium has become a go-to source of entertainment and education for many, which is why business owners are clamoring to launch their own podcast ventures. While many podcasts have had unprecedented success and reach, many more have been made that have flown under the radar, so entrepreneurs considering starting a podcast for their company should do so cautiously and with a few considerations in mind. Below, 10 Rolling Stone Culture Council experts share what entrepreneurs should understand before they invest time, energy and resources into launching a podcast.
If You’re Too Old for an Internship, Try a Returnship Instead; More retirees are opting for short-term gigs that keep them engaged and earning money.
Arianne Cohen – Bloomberg
When he’s not hanging out in his Santa Monica home or exploring remote corners of California, Chris Emhardt can be found surveying voting sites and installing the hardware needed to ensure local elections take place smoothly. In 2019 he retired from a four-decade career in similar work at media companies and had planned to simply take it easy and travel. But he’s back on the job and loving it. Two years ago he got a three-week election project, then a two-month gig, then a half-year. “The difference is I’m not trying to build or advance my career,” the 65-year-old says. He loves that he can just do what’s asked of him and head home at the end of the day—though he says he finds so much purpose in bolstering public elections that he regularly logs more than 40 hours a week. “I don’t mind going 110% for a month,” Emhardt says. “But I wouldn’t want to do that as a full-time job.”
To Find the Wines of Summer, Just Say Quaffable; Terms like ‘refreshing,’ ‘easy drinking,’ ‘crisp’ and ‘light’ have all been offered as synonyms. Our wine columnist dove deep into the category and came up with 5 categorically quaffable wines (also great values) to drink right now.
Lettie Teague – WSJ
What does “quaffable” mean? When I went in search of a quaffable wine recently at Bogey’s Bottled Goods in Southold, N.Y., partner Zach Glassman met my request with a raised eyebrow. ” ‘Quaffing’ is such a fun word,” he said. “You don’t often hear such eloquence on Long Island!” As a one-time resident of Long Island, I took the tiniest umbrage at Mr. Glassman’s response, but I understood what he meant. I love the words quaffing and quaffable. They are fun and capture the character of summer; to me, a quaffer is a wine that does the same. But while I’ve always found these to be useful descriptors, not everyone seems to agree. Often, retailers will translate “quaffable” to terms like “easy drinking” and “refreshing.”