Former Deutsche Bank trader seeks to overturn ‘spoofing’ conviction

Nov 1, 2022

First Read

Hits & Takes
John Lothian & JLN Staff

ICE posted to LinkedIn that it is building its tenth house in Atlanta with Habitat For Humanity. Way to go! Another charity endeavor ICE is involved in creates even more buzz – its partnership with Bee Downtown, a startup that places hives on corporate campuses to build a sustainable honeybee ecosystem.

It was this week back in 1970 that Merrill Lynch acquired Goodbody & Company, the U.S.’s fifth largest brokerage firm, which had been overcome by trading volume. This came during the “back office crisis” after the “NYSE Special Trust Fund” had been depleted.

TMX CEO John McKenzie spoke to Bloomberg about the positive impact that changes to the U.S. cannabis laws would have for the Canadian market.

It turns out that “Chief Twit” is another name for chief executive officer, as an SEC filing revealed that Elon Musk is the new CEO of Twitter, the New York Post reported.

Melissa Blogg is starting a new position as marketing executive at AFME (Association for Financial Markets in Europe).

Iain Donald is starting a new position as director of business development, EMEA at Eventus.

Karel Vecera, CFA, is starting a new position as associate, Stoxx Index Review at Qontigo.

ICE is looking for a “director, operations and NYSE Institute.” Reporting to the vice chairman, NYSE Group and president, NYSE Institute, this role will support strategic and long-range efforts of the NYSE and NYSE Institute.

Baris Mestanogullari is starting a new position as chief technology officer at Gelber Group LLC.

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


PhillipCapital Inc. is holding a Trading Asia Symposium in Chicago on November 16, 2022, at the InterContinental Chicago Magnificent Mile. The symposium is from 9 a.m. to 1:30 p.m. Chicago time. Exchange representatives and industry veterans will discuss the Asian derivative markets, key developments and latest innovations. Speakers include Bluford Putnam, chief economist, CME Group, and Vineet Bhatnagar, CEO, PhillipCapital India. Those who should attend include corporates, proprietary trading groups, commodity trading firms, asset managers, brokers, financial institutions and physical hedgers. You can go here to register.~SR

Nasdaq used its proprietary Natural Language Processing (NLP) tools to analyze the earnings call transcripts of Russell 3000 and MSCI USA ESG Leaders constituents to track the development of the ESG discussion between companies and the capital markets. The exchange found a 12% and 13% respective quarter-over-quarter increase in ESG discussion on earnings calls in Q2’22, solidifying the earnings call as a key venue for issuers to communicate their ESG strategy and progress. You can download the Nasdaq Quarterly ESG Report: Differentiating Amongst the Crowd here. ~SAED


Listen to ICE’s Caterina Caramaschi, VP of Financial Derivatives, discuss the breadth of the FTSE equity derivatives complex and the upcoming launch of ICE FTSE 100 Index Total Return Futures – a more flexible way to trade equity repo.


MWE SHORT: Cathy Lyall – 30 Years of Change

Cathy Lyall’s first day in the markets was 1987’s Black Monday. She had planned on going into foreign affairs but snagged a job as a futures broker the Thursday before the crash from her boyfriend, a cash bond broker. She also signed her first mortgage in London the Friday before Lehman Brothers collapsed. Life events when synced with world events yield perspective.

Watch the video »


The Accountant Shortage Threatens Capitalism’s Future; Where did all the number-crunchers go, and what can be done to get them back?
Adrian Wooldridge – Bloomberg
Capitalism can’t function without a healthy system of accounting. The breakthrough from feudalism to capitalism in Renaissance and Reformation Europe was only made possible by the emergence of professional accountants. And a dearth of accountants – or a dearth of respect for accountants – has spelled trouble ever since. “Over and over again,” Jason Soll wrote in his fascinating history of accounting, “The Reckoning: Financial Accountability and the Making and Breaking of Nations,” “good accounting practices have produced the levels of trust necessary to fund stable governments and vital capitalist societies, and poor accounting and its attendant lack of accountability have led to financial chaos, economic crimes, civil unrest and worse.”

***** Do we want the number crunchers back? Can’t we just write an app or something?~JJL


Elon Musk Grabs Twitter Wheel, Aims for Cliff; His ownership of the social media giant is not off to a great start.
Mark Gongloff – Bloomberg
Alexis Leondis has a piece today encouraging Americans to book their capital losses by year-end, to take advantage of the tax breaks you get when you take a bath on your investments. Personal note to Elon Musk: This advice may not apply to trashing a multibillion-dollar company you bought on a lark. To be safe, run the idea by @catturd2.

****** Elon and Louise? I loved that movie.~JJL


Help me feed a few thousand families this Thanksgiving
Joshua M Brown – The Reformed Broker
Here’s the deal – during the pandemic I wanted to do a book signing for the fans when we released How I Invest My Money. Obviously, travel and meet and greets weren’t going to happen, so we had to improvise. Instead, we set up a virtual book signing where you guys mailed me the books along with a check for $20 to Long Island Cares and the Harry Chapin Food Bank. I signed and sent them all back to everyone at my own expense. I was happy to do it and you guys helped me a raise a lot of money.

****** Feed the poor. It is a good place to start.~JJL


Opinion: Wall Street CEOs confirm their allegiance to Beijing
Robby Stephany Saunders – MarketWatch
China has been in the news plenty this year. First there was the controversy surrounding Beijing’s hosting of the Winter Olympics. And then the United Nations issued a report confirming China’s “crimes against humanity.” Clearly, China is an egregious violator of human rights. But despite such global notoriety, America’s financial industry has remained curiously indifferent. In fact, America’s major investment firms continue to maintain a cozy relationship with Beijing. And nowhere is this more apparent than the upcoming Global Financial Leaders’ Investment Summit in Hong Kong.

****** How about keeping your friends close and your enemies closer? How about trying to have a positive impact on everyone, friend and foe alike. How about believing in people. ~JJL


Monday’s Top Three
Our top story Monday was Can Gary Gensler solve every problem in American finance? from The Economist via Yahoo! Finance. Second was the jobs page for the Federal Reserve Bank of Chicago, which is looking for applicants for its 2023 Summer Internship Program. Third was the LinkedIn job posting for a senior options market maker at Prime Trading in Chicago.


MarketsWiki Stats
27,053 pages; 241,441 edits
MarketsWiki Statistics


Lead Stories

Former Deutsche Bank trader seeks to overturn ‘spoofing’ conviction; Appeal to the US Supreme Court claims federal prosecutors are pushing the boundaries of what constitutes fraud
Kate Beioley and Joe Miller – Financial Times
A former Deutsche Bank commodities trader has appealed his conviction to the Supreme Court in a last-ditch attempt to avoid prison, arguing prosecutors misused the wire fraud statute in order to sentence him. James Vorley, who was a London-based trader of precious metals futures at the German lender, was convicted on wire fraud charges in federal court in Illinois in 2020, along with co-defendant Cedric Chanu. Both men were sentenced to 12 months and a day in prison last year for “spoofing” the futures market for gold and silver between 2008 and 2013.

ICE Bonds Receives Approval for Expansion in Canada
Intercontinental Exchange, Inc. (NYSE: ICE), a leading global provider of data, technology and market infrastructure, today announced it has received approval to operate its ICE TMC fixed income trading platform in all Canadian jurisdictions, paving the way for full access to ICE’s leading electronic municipal bond marketplace. ICE TMC, which is part of ICE Bonds, provides market participants with access to an all-to-all market for trading municipal, corporate, agency and government bonds, as well as Certificates of Deposit. ICE’s municipal bond offering brings together ICE’s industry-leading Continuous Evaluated Pricing for munis, pre-trade analytics and access to the full breadth of ICE’s municipal bond market liquidity, which includes depth of market from both ICE TMC and ICE BondPoint, which received approval to operate in Canada on June 19, 2020.

CFTC Staff Recommends Rejecting Kalshi’s US Election Contracts: Bloomberg; Commissioners would still need to vote on the advice.
Nick Baker – CoinDesk
Prediction market Kalshi’s request to create contracts linked to U.S. election outcomes should be rejected, according to staff of the regulator weighing the request, Bloomberg reported. Their recommendations are not binding. Commissioners at the U.S. Commodity Futures Trading Commission ultimately decide, though staff members’ advice carries weight.

Paltry Emerging Market Investment Flows Point to Climate Catastrophe; Unless emerging markets start drawing considerably more cash to put toward clean energy, the world has little chance of limiting temperatures to 1.5C
Alastair Marsh – Bloomberg
Investment in clean energy in emerging markets is less than a tenth of what’s required to keep the world on course to limit global warming to 1.5C, according to a new report from BloombergNEF. While developing economies account for almost half of global greenhouse gas emissions and over a third of energy-related emissions, the volume of capital invested in moving these countries to lower-carbon sources of energy “is insufficient given the size of the climate challenge,” BNEF said in a report published on Tuesday. The International Energy Agency estimates emerging economies will need an additional $1 trillion of investment per year to achieve net-zero energy systems, yet just $67 billion went to emerging economies last year, BNEF data show.

U.S. federal judge in New York criticizes SEC ‘gag orders’ policy
Jody Godoy – Reuters
A U.S. federal judge in New York on Friday called it “troubling” that a Securities and Exchange Commission (SEC) policy makes people who settle charges of fraud, insider trading or other allegations agree not to deny them later. Under the decades-old policy, defendants who settle without admitting to allegations must agree not to publicly deny them. The practice, a standard in SEC settlements, has been upheld in courts despite drawing ire from critics including former defendants, the libertarian Cato Institute and other groups that favor limiting government power.

ICE takes $1.1 billion write off for stake in crypto platform Bakkt; The exchange expects to reduce the carrying value of its investment in Bakkt to $400 million from $1.5 billion earlier this year.
Wesley Bray – The Trade
According to a Securities and Exchange Commission (SEC) filing last week, Intercontinental Exchange (ICE) is taking a $1.1 billion write off for its holdings of Atlanta-based crypto platform, Bakkt. The crypto and digital assets provider to institutional investors will record an impairment loss on goodwill amounting to approximately $1.3-1.4 billion, in addition to certain indefinite-lived intangible assets between $150-160 million. Originally formed in 2018 by ICE, Bakkt’s first use cases for its platform were bitcoin, other cryptocurrencies and bitcoin futures contracts.

Record E-Trading Brings More Liquidity to Corporate Bond Market; Average daily trading reached $15 billion in September; Investors say improved algos keep bid-ask spreads narrow
Jack Pitcher – Bloomberg
Electronic trading of corporate bonds has reached record levels, as credit-trading algorithms get smarter, grab market share, and make it easier for investors to buy and sell corporate bonds without affecting prices too much. Banks, money managers and others on average traded $15 billion of company bonds electronically daily in September, according to a report from Coalition Greenwich, looking at both investment-grade and high-yield debt. That record level compares with a $12.7 billion daily average in 2021. For junk bonds, about a third of trading volume was through online platforms last month, up from about a quarter in the same period last year.

U.S. Treasury Issues New Guidance on Russian Oil-Price Cap in Bid to Calm Markets; The department said it would exempt ships loaded with Russian oil before Dec. 5 from the price cap if they are unloaded by Jan. 19
Andrew Duehren – The Wall Street Journal
The Treasury Department said that ships loaded with Russian oil before Dec. 5 won’t be subjected to U.S.-led price cap on Russian oil, as Washington attempts to reassure anxious oil markets about its plan for new sanctions. Beginning on Dec. 5, the U.S. and its allies will ban companies in their countries from providing maritime services to shipments of Russian oil unless the oil is sold below a set price.

Wells Fargo says SEC is examining its hiring practices
Wells Fargo & Co said on Monday that the U.S. Securities and Exchange Commission has begun investigating its hiring practices, after the Department of Justice had opened a related probe. In its quarterly report filed with the SEC, the fourth-largest U.S. bank said both agencies “have undertaken formal or informal inquiries or investigations regarding the company’s hiring practices related to diversity.”

Bankman-Fried calls wealth-based barriers to crypto investment classist, racist
Dylan Butts – Forkast
The billionaire founder of crypto exchange FTX, Sam Bankman-Fried, criticized regulations in Hong Kong and elsewhere that limit crypto investment access to wealthy investors during a webinar at the city’s FinTech Week 2022 on Monday. Wealth-based suitability tests are “deeply classist and deeply racist,” said Bankman-Fried , asserting that the policy allows the rich to get richer while discriminating against otherwise qualified investors.

Rishi Sunak Must Detoxify Brexit to Save Himself; A thaw in UK-EU relations is the UK prime minister’s best hope of political survival.
Therese Raphael – Bloomberg
During his Sunday morning broadcast rounds, Michael Gove, the arch-Brexiteer and now UK cabinet secretary in charge of leveling up, repeated a claim he’d made countless times before: Brexit, he said, had been “a significant success for this country.” Even a veteran spinner like Gove struggled to sustain the assertion. “What planet has this lunatic been living on?” asked Australian vlogger Peter Stefanovic in a viral video detailing all the ways Brexit has exacerbated economic weaknesses.

Crypto use for child abuse images doubling every year, says watchdog; Websites accepting digital currencies for illegal content increasing as buyers seek anonymity
Scott Chipolina and Cristina Criddle – Financial Times
The number of websites accepting cryptocurrency as payment in exchange for child sexual abuse material (CSAM) has more than doubled every year since 2018, according to a charity that combats criminal content online. The Internet Watch Foundation (IWF) identified 250,000 websites that contained child sexual abuse content last year, more than 1,000 of which allowed users to purchase material using cryptocurrencies. This is up from 81 in 2018.

Ether miners repurpose tools following the ‘Merge’; Consumers plan to reuse energy-intensive equipment for alternative services
Martha Muir – Financial Times
Ether crypto miners are looking to repurpose technology made obsolete by last month’s “Merge” for other energy-intensive activity, potentially blunting the crypto project’s effort to slash its carbon footprint. Companies and small investors that lost out following the success of the Merge are turning to mining other cryptocurrencies, hosting services in the cloud and even heating their homes to make use of their equipment.

Leaders in Trading 2022: Meet the nominees for…. Outstanding Trading Technology Provider; Learn more about the five firms shortlisted for our Editors’ Choice Award for Outstanding Trading Technology Provider this year: including BTON Financial, Broadridge Trading and Connectivity Solutions, FlexTrade, Instinet, ION Markets and TS Imagine.
Wesley Bray – The Trade
The TRADE is delighted to introduce the shortlist for our Editors’ Choice Award for Outstanding Trading Technology Provider. These shortlisted trading technology providers have all experienced great years and achieved outstanding performance. Learn more about the candidates below, including BTON Financial, Broadridge Trading and Connectivity Solutions, FlexTrade, Instinet, ION Markets and TS Imagine.

Editors’ Choice Award for Best Challenger Exchange, a new category for this year: including Archax, FTX, IEX, MEMX and MIAX.
Laurie McAughtry – The Trade
Best Challenger Exchange is a new category for Leaders in Trading this year, in which we recognise not only the ever-changing facets of the marketplace but also the plethora of new venues springing up to accommodate them.

Eurex lures euro clearing volumes to Europe post-Brexit with new buy-side incentive scheme; The clearinghouse confirmed the move was to reduce reliance on CCPs outside of the EU in line with regulatory objectives.
Annabel Smith – The Trade
Eurex has launched a new incentive program aimed at encouraging more euro clearing volumes to the European Union post-Brexit. Designed for clients running active accounts in the EU, the scheme could qualify participants for an incentive reward of up to 50,000 euros when starting the clearing of OTC interest rate swaps (IRS), overnight index swaps (OIS), basis swaps and/or zero-coupon inflation swaps (ZCIS) at Eurex Clearing next year. Eligible clients may register for the incentive program until 31 March.

Ukraine Invasion

Ukraine ships grain despite collapse of Black Sea deal; Russia’s decision to suspend agreement expected to hit poorer nations
Roman Olearchyk, Emiko Terazono and Emiko Terazono – Financial Times
Ukraine has said that 12 ships carrying grain left its Black Sea ports on Monday, despite Russia’s withdrawal from a UN-backed deal that allowed the passage of million of tonnes of grain during Moscow’s full-scale invasion. The UN and Turkey, which co-brokered the so-called Black Sea Grain Initiative in July, approved the resumption of shipments, which had stopped on Sunday. Russia’s decision on Saturday shook global markets, pushing up wheat prices.

Swiss veto of weapons re-exports to Ukraine angers Germany; Bern politicians say transfer of ammunition to Kyiv would jeopardise nation’s neutrality
Sam Jones – Financial Times
German politicians have called for an end to arms deals with Switzerland as a political dispute deepens over Bern’s refusal to allow arms to be shipped to Ukraine. Swiss lawmakers responded on Monday with accusations – and thinly veiled references to the second world war – that Germany “no longer respects” Switzerland’s political neutrality. The issue has become more urgent since Russia escalated an aerial campaign targeting Ukraine’s infrastructure and as Kyiv’s weapon stocks have dwindled, German officials said.

Putin says power grid strikes were in response to Crimea drone attack
Pavel Polityuk – Reuters
President Vladimir Putin said Russian strikes on Ukrainian infrastructure and a decision to freeze participation in a Black Sea grain export programme were responses to a drone attack on Moscow’s fleet in Crimea that he blamed on Ukraine. Putin told a news conference on Monday that Ukrainian drones had used the same marine corridors that grain ships transited under the U.N.-brokered deal.

Appoint a Watchdog for Ukraine Aid; More transparency over how billions are being spent would protect US taxpayers and sustain political support for the war.
The Editors – Bloomberg
Since Russia’s invasion of Ukraine in February, the Kyiv government has received more than $60 billion in security and humanitarian assistance from the US, making it by far the world’s biggest annual recipient of such aid. Now some Republican leaders want to toughen oversight over how those funds are being spent. They’re right to do so. The scale of the aid effort is unprecedented. In just seven months, the US has provided Ukraine with nearly double what it gave all of western Europe on an annual basis during the Marshall Plan in real terms. Support for Ukraine’s military this year equals what the US provided Israel, Egypt and Afghanistan combined in 2020.

Exchanges, OTC and Clearing

LoopFX peer-to-peer FX spot trading venue to launch pilot phase; The pilot phase will come to market next month with a full launch expected in the second half of next year.
Annabel Smith – The Trade
A new venue for large spot FX trades has set out plans for its roll-out into the market, beginning with a pilot phase due to launch next month. Named LoopFX the venue has high hopes of becoming the new liquidity venue for large spot FX trades using a “revolutionising” centralised peer-to-peer-to-bank model which matches peers with each other and with bank interest.

Amendment to the Daily Settlement Procedure for All Options on Emini S&P 500 Futures and Options on Micro E-mini S&P 500 Futures Contracts
CME Group
Effective Sunday, December 4, 2022, for trade date Monday, December 5, 2022, and pending all relevant CFTC regulatory review periods, Chicago Mercantile Exchange Inc. (“CME” or “Exchange”) will amend the daily settlement procedure for all Options on E-mini S&P 500 Futures and all Options on Micro E-mini S&P 500 Futures contracts (the “Contracts”) for trading on the CME Globex electronic trading platform (“CME Globex”) and for submission of clearing via CME ClearPort. Specifically, the amendment to the daily settlement method for the Contracts will change from utilizing an interest rate curve input derived from the Secured Overnight Financing Rate (“SOFR”) market to instead utilizing an interest rate curve input derived from the Contracts’ market quotations directly. Note that the final settlement procedure for the referenced options will remain unchanged.

Eurex launches new incentive program for euro clearing in the EU
Deutsche Börse Group
To support buy-side clients starting clearing OTC interest rate derivatives positions in the EU, Eurex Clearing is now offering special incentives. This is a further step in support of the regulatory objectives to bring more Euro Clearing into the EU and in turn reduce reliance on CCPs outside the EU.

Review on Guarantee Fund
HKSCC has performed a review of the size of the Guarantee Fund and the contributions required from each Clearing Participant. The required size of the Guarantee Fund excluding the Dynamic Contribution Credit for all Clearing Participants after the re-calculation is HK$3,493 million. The amounts of Basic Contribution and Dynamic Contribution required from a Clearing Participant are re-calculated based on its share of the average Expected Uncollateralised Loss (EUL) of all Clearing Participants, for the period from 5 August 2022 to 31 October 2022 pursuant to Section 18.2.1 of the CCASS Operational Procedures.

Trading Overview in October 2022; Japan Exchange Group released Trading Overview in October 2022.
Cash Equity Market; In October 2022, the daily average trading value for the Prime Market (domestic common stocks) was JPY 3.5543 trillion. The daily average trading value for the ETF market was JPY 319.7 billion.

LME Non-Business Days For The Remainder Of 2022 And For 2023
This Notice reminds Members of the non-Business Days of The London Metal Exchange (the “LME”) for the remainder of 2022 and advises Members of the non-Business Days for 2023, when the LME will be closed. This Notice includes the operating times for 23 December 2022 and 30 December 2022.

Eurex Exchange Readiness Newsflash | Updates November 2022
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.

Shanghai International Energy Exchange has released its Circular on Approving PT. HOK TONG to Change TSR 20 Product Belt Design as follows:
Recently, the Shanghai International Energy Exchange (hereinafter referred to as “INE”) has received the application materials of PT. HOK TONG.


Elon Musk Is Forming Circle of Advisers as He Reimagines Twitter; Group is working on a range of initiatives to bolster the social-media platform
Alexa Corse and Sarah E. Needleman – The Wall Street Journal
Elon Musk is quickly setting to work a group of advisers, investors and employees from elsewhere in his business empire to help him reimagine Twitter Inc. in his first days as its new owner. The group is working on a range of initiatives to try to bolster the platform’s user experience and revenue, according to people involved in the effort, while Mr. Musk continued to publicly float potential changes in a series of tweets.

Musk Consolidates Power at Twitter After Board Is Dismissed; Elon Musk is Twitter’s sole director after dismissal of board; Company will buy back any and all 2027, 2030 senior notes
Jack Pitcher – Bloomberg
Elon Musk consolidated his control of Twitter Inc. on Monday after the entire board was dismissed. Musk, 51, completed his purchase of Twitter last week for $44 billion and immediately started molding the company to his liking. One of the first steps he took was to fire four of the most senior executives of the company, including Parag Agrawal, the chief executive officer. Calling himself Chief Twit, Musk plans to effectively run the company himself in the immediate term, people familiar with his plans have said.

Musk-Driven Dogecoin Surge Is a Warning to Twitter; The social media platform needs to be more than an echo chamber for crypto hustles.
Lionel Laurent – Bloomberg
The bursting of social media’s ad-funded bubble is creating big market waves. Meta Platforms Inc. is less valuable than Home Depot Inc., Snap Inc. is worth less than Deutsche Bank AG (which underwrote its IPO), and Twitter is now privately owned by Elon Musk after almost a decade of cumulative stock-market underperformance.

Brazilian Fintech Nubank Opens New Building in Sao Paulo; Brazil CEO says the firm is ‘experimenting with spaces’; The new location will be used for parties, team work, training
Cristiane Lucchesi and Felipe Marques – Bloomberg
Nu Holdings Ltd., a Brazilian fintech backed by Warren Buffett, opened a building in Sao Paulo to be used for big events, training and parties. “We’re going to be piloting a new type of setup to maximize the benefit that teams can get from working at the office,” Brazil Chief Executive Officer Cristina Junqueira said in an interview. “We’re going to be experimenting with spaces.”

Microsoft Wants AI To Change Your Job-If It Can Work Out the Kinks; Microsoft believes its artificial intelligence tools are poised to reshape ‘thousands’ of professions. There are just a few legal and ethical hazards
Dina Bass – Bloomberg
The most hyped words in tech today may be “generative AI.” The term describes artificially intelligent technology that can generate art, or text or code, directed by prompts from a user. The concept was made famous this year by Dall-E, a program capable of creating a fantastic range of artistic images on command. Now a new program from Microsoft Corp., GitHub Copilot, seeks to transform the technology from internet sensation into something broadly useful.


Don’t Go Chasing Cyber Tools: Overlooking Cybersecurity Talent And Strategy Can Cost You
Mike Lefebvre – Forbes
One of the biggest cyber blunders companies make is overinvesting in cyber tools and underinvesting in strategy and talent. How can organizations know what security controls they need without an overall cybersecurity program and game plan?

Here’s the Pitch Deck for Healthcare Cybersecurity Startup MedCrypt
Samantha Stokes – Business Insider
As hospitals adopt more complex technologies, one startup just sold investors on its cybersecurity software that keeps medical devices compliant with federal guidelines – and safe from online attacks. Healthcare cybersecurity startup MedCrypt just raised a $25 million Series B, Insider has learned. Intuitive Ventures and Johnson & Johnson Innovation led the round, while Section 32, Erica Ventures, Anzu Partners, and Dolby Family Ventures also participated.

White House convenes dozens of countries to fight ransomware
David Jones – Cybersecurity Dive
The White House is hosting three dozen nations and the European Union over the next two days at the 2nd International Counter Ransomware Initiative. The summit follows a series of high-profile attacks in recent weeks against the Los Angeles Unified School District and CommonSpirit Health.

Why culture is the foundation of your cybersecurity strategy – Microsoft News Center Canada
Chris Barry – Microsoft
The evolving sophistication of the global threat landscape, along with our almost overnight adoption of the hybrid work model has caused a paradigm shift in the world of cybersecurity. Our own 2022 Work Trend Index shows that people are collaborating, chatting, emailing and sharing information in new ways and in greater volumes than ever before. This digital transformation represents an opportunity for customers to achieve ongoing innovation that benefits their businesses and the industries in which they operate but this comes with challenges to consider.

CISA releases cybersecurity performance goals to reduce risk and impact of adversarial threats
Cynthia Brumfield – CSO Online
Last week, the US Cybersecurity and Infrastructure Security Agency (CISA) released voluntary cross-sector Cybersecurity Performance Goals (CPGs). CISA was required to produce the CPGs under a national security memo on improving cybersecurity for critical infrastructure control systems issued by President Biden in July 2021. Working in coordination with the National Institute of Standards and Technology (NIST) and the interagency community, CISA developed “baseline cybersecurity performance goals that are consistent across all critical infrastructure sectors.”


Dogecoin’s Rally Reminds Crypto Bulls of Simpler Times; Token gained 100% this week, outpacing Bitcoin’s 6% advance; Surge fueled by hope that Musk will integrate token on Twitter
Carly Wanna – Bloomberg
The hottest cryptocurrency is a token bearing the face of a Shiba Inu meme that is currently trading near 13 cents. Dogecoin, a long-time favorite of billionaire Elon Musk, has gained 100% this past week, far exceeding the advances of the world’s two largest tokens, Bitcoin and Ethereum, up around 6% and 17%, respectively. That surge makes Dogecoin a top performer among the 10 largest coins by market capitalization, according to Monday morning.

Indian Finance Minister Says Crypto Regulation Is a ‘Working Priority’ for Its G20 Presidency Next Month
Amitoj Singh – CoinDesk
Indian Finance Minister Nirmala Sitharaman has said framing crypto assets would be one of eight priorities that are still in the works for the nation’s year-long G20 Presidency which begins next month during a speech at an event of a think tank on Tuesday.

Coinbase-Backed Anti-Money Laundering Group Expands Into Europe
Ian Allison – CoinDesk
The Coinbase-backed cryptocurrency anti-money laundering (AML) group, the Travel Rule Universal Solution Technology (TRUST), has expanded into Europe. TRUST, which was originally kick-started in the U.S. by the Coinbase (COIN) crypto exchange with help from BitGo, Gemini, Kraken and Fidelity, said earlier this year it had established a footing in Canada and Singapore. As part of its European advancement, the TRUST membership has grown to 67 firms, according to a press release.

Binance CEO says charging Twitter users ‘can be done very easily globally using cryptocurrencies’
Anushree Dave – MarketWatch
“We want to help solve immediate problems,” Zhao said on CNBC’s SquawkBox Monday morning, days after Binance helped to finance Elon Musk’s takeover of Twitter, which is being taken private and de-listed. Zhao’s comment comes after buzz about possible monthly charges for Twitter blue subscriptions, as well as a charge for verified users, who would lose the blue verification checkmark within 90 days if they didn’t pay. Elon Musk might force you to pay up.

End of the Monopoly: How Bitcoin Will Usher in a New Era of Governance in Crypto
Edan Yago – CoinDesk
Across the world, people are losing trust in the institutions that underpin society. Any thinking person can see the institutions of governance, finance and money are corrupt, incompetent and yet unavoidable. As a result, the world is in a continued state of crisis, gyrating from one emergency to another with ever increasing speed and volatility. Progress and growth are stagnant. Hate, nihilism and pessimism are culturally dominant.

The Myth of ‘Regulatory Clarity’
Noelle Acheson – CoinDesk
Go around the room at any highbrow crypto gathering and ask what the suited participants are most excited about. The answer you’ll most likely hear is “regulatory clarity.” They’re not wrong – it would indeed be a boon to the industry as it would give builders and investors a certain amount of protection and usher in even more institutional funds. But it’s not the “make or break” for crypto that it’s sometimes painted to be. And those who insist that “all of crypto must be regulated” display a lack of understanding of what crypto is and how it got to where it is today.

Hong Kong seeks to allow crypto futures ETFs
Ningwei Qin – Forkast
An official at Hong Kong’s financial sector regulator, the Securities and Futures Commission, said on Monday the institution is actively seeking to build a regime to allow digital asset-based exchange-traded funds (ETFs) to be publicly listed and traded in the city. A circular will be issued later on Monday to reveal more details about the plan, said the SFC’s deputy chief executive officer, Julia Leung.

How Elon Musk Could Put More Crypto Into Twitter; Takeover opens up possibilities for blockchain, other features; Tesla CEO Musk has sent mixed signals concerning crypto
Hannah Miller – Bloomberg
After months of dramatic back-and-forth, Elon Musk has taken control of Twitter Inc., igniting emotions ranging from hope to anxiety among users who are bracing themselves for how the billionaire will put his stamp on the social-media platform. Crypto Twitter is no exception. Digital-asset enthusiasts have long congregated on Twitter, where they’ve changed their profile pictures to images of themselves with “laser eyes” as a signal of their crypto support, posted irreverent memes about rising (and then falling) coin prices and re-tweeted threads from their favorite founders.

Coinbase Files to Support Ripple Against SEC Case
Nikhilesh De – CoinDesk
Crypto exchange Coinbase has petitioned a federal court for permission to file a friend-of-the-court (amicus) brief in the ongoing lawsuit between the U.S. Securities and Exchange Commission (SEC) and Ripple Labs. Coinbase joins the Blockchain Association, an industry lobbyist group, SpendTheBits, a crypto payments app that uses XRP and John Deaton, a lawyer, in hoping to shore up Ripple’s case against the SEC, which sued Ripple at the end of 2020 on allegations it sold XRP as an unregistered security.

Steph Curry Files ‘Curryverse’ Metaverse Trademark
Eli Tan – CoinDesk
National Basketball League (NBA) star and non-fungible token (NFT) enthusiast Steph Curry has filed a trademark for the “Curryverse,” indicating plans to create interactive “virtual environments” to sell metaverse and NFTs. The full trademark filing includes rights for “entertainment services, namely, personal and virtual and metaversal appearances” by Curry as well as “online gaming services in the nature of virtual worlds.”


Biden to Urge Congress to Consider Tax Penalties on Big Oil; Shares of refiners, oil producers drop after news report; AP reported windfall tax is being considered by White House
Akayla Gardner and Kevin Crowley – Bloomberg
President Joe Biden will call on Congress to consider tax penalties for oil and gas companies accruing record profits, according to a White House official, amid stubbornly high gasoline prices that are dragging on Democrats’ midterm prospects. This could include a so-called windfall profit tax — which Democrats have been proposing for more than a decade without success. The idea has renewed attention among progressives in Congress after gasoline prices spiked to more than $5 a gallon this summer.

Biden Accuses Oil Companies of ‘War Profiteering’ and Threatens Windfall Tax
Peter Baker and Clifford Krauss – The New York Times
President Biden threatened on Monday to seek a new windfall profits tax on major oil and gas companies unless they ramp up production to curb the price of gasoline at the pump, an escalation of his battle with the energy industry just a week before the midterm elections. The president lashed out against the giant firms as several of them reported the latest surge in profits, which he called an “outrageous” bonanza stemming from Russia’s war on Ukraine. He warned them to use the money to expand oil supplies or return it to consumers in the form of price reductions.

Sunak, Hunt Say ‘Inevitable’ All Britons Will Pay More Tax; UK Treasury describes fiscal black hole as ‘eye-watering’; Two research groups say spending cuts alone are insufficient
Joe Mayes and Philip Aldrick – Bloomberg
Rishi Sunak’s government said it’s inevitable that all Britons, especially the richest, will have to pay more tax to restore stability to the public finances. Sunak met with Chancellor of the Exchequer Jeremy Hunt on Monday to discuss tax and spending plans ahead of an economic statement planned for Nov. 17. They discussed the “eye-watering” gap in Britain’s public finances, and agreed “tough decisions” are needed on tax rises and on spending, according to a Treasury readout.

George Soros: Issuing perpetual bonds would show that Sunak is serious; The new UK premier needs to reassure financial markets after the chaos caused by Truss and Kwarteng
George Soros – Financial Times
After Liz Truss’s disastrous financial performance as UK prime minister, the first task of her successor, Rishi Sunak, is to reassure markets that he is a professional. He must acknowledge the market worries about deficit spending, which were on full display in the turmoil that followed former chancellor Kwasi Kwarteng’s “mini” Budget. But Sunak must be careful not to impose too much austerity, which could trigger a full-blown financial crisis in a country that is facing many headwinds, including a shortage of affordable housing and a looming pension crisis.

Sunak signals he could attend UN climate summit; Prime minister may U-turn on decision not to go to COP27 following criticism by Tory MPs
George Parker, Sebastian Payne and Camilla Hodgson – Financial Times
Rishi Sunak has opened the door to a possible U-turn over his decision not to attend next month’s UN COP27 climate change summit after growing criticism from Tory MPs. Sunak’s allies said on Sunday that the prime minister’s priority “first and foremost has to be focusing on domestic issues” but they left open the possibility that he might fit in the summit in Egypt that starts on November 6. “Going depends on progress,” said one, adding that Sunak’s diary was currently focused on dealing with the economic crisis and the government’s autumn statement due on November 17.

Task to build new EU gas benchmark will be ‘demanding’, admits regulator; Search for more ‘representative’ way to track prices to reflect replaced Russian gas proves tricky
Nikou Asgari, David Sheppard and Alice Hancock – Financial Times
The regulator charged with building a planned new EU benchmark for imported gas has admitted the ambitious project will be difficult to put into practice. Acer, the EU’s energy regulator, has joined traders and analysts casting doubt on a plan from Brussels for a new regional standard that would more accurately track the price of liquefied natural gas being shipped into the bloc.

Germany’s Scholz Pledges Speedy Start for Natural Gas Subsidies; Cabinet to start implementing energy proposals this week; EU has given green light for the bailout worth €100 billion
Petra Sorge – Bloomberg
German Chancellor Olaf Scholz promised the swift implementation of natural gas price subsidies recommended by a government-appointed panel to ease the impact of soaring energy costs. “The cabinet will start implementing the proposals this Wednesday,” Scholz said at a press conference in Berlin. “We don’t want to let anyone alone in this difficult situation.”

Japan cannot survive without Russian oil, warns trading house chief; Head of Itochu says there are ‘all kinds of ways’ Moscow can continue to export energy despite sanctions
Roula Khalaf, Kana Inagaki and Leo Lewis – Financial Times
Japan’s near total dependence on imported energy means it cannot “survive” without continuing to buy oil and gas from Russia, said the head of one of the country’s big five trading houses. In an interview with the Financial Times, Masahiro Okafuji, chief executive of Itochu, whose largest shareholder is Warren Buffett, said the country’s continuing use of Russian energy after the invasion of Ukraine would hinge on support from the US and Europe for Japan’s position.


DOJ Gets Conviction in First Criminal Monopoly Case in Decades; Montana executive pleaded guilty in highway repairs case; Case reflects Biden administration’s broad antitrust agenda
Leah Nylen – Bloomberg
The Justice Department on Monday won its first criminal monopolization case in more than 40 years when a construction company executive pleaded guilty to monopolizing the market for highway crack-sealing services in Montana and Wyoming. A Montana federal judge accepted the plea of Nathan Zito, president of of Z&Z Asphalt Inc., a paving and asphalt company in Billings, Montana, for attempted monopoly by allegedly offering a competitor a “strategic partnership” to split-up regional markets for highway repairs.

Firms Elect Edward Jones’ Penny Pennington to FINRA Board of Governors; Pennington Elected to One of Three Large-Firm Seats on FINRA Board
FINRA announced today that Penny Pennington, Managing Partner of Edward Jones, was elected as a large-firm governor of the FINRA Board of Governors at a special meeting of large-firm members. “Penny’s leadership experience and knowledge of the industry will make her a valuable contributor to the Board of Governors’ oversight of FINRA’s efforts to protect investors and ensure market integrity. We look forward to working with her,” said FINRA Chair Eric Noll.

SEC Charges Incarcerated Felon and Five Friends in $2 Million Fraud Scheme
The Securities and Exchange Commission today charged six individuals, including a federal inmate, for conducting a freeriding scheme that defrauded multiple broker-dealers. The SEC’s complaint alleges that from May 2019 to early January 2021, Syed Arham Arbab, 25, and five others made more than $2 million in bogus deposits from empty or underfunded bank accounts into various brokerage accounts to deceive broker-dealers into providing instant deposit credit for online securities trading.

SEC Awards More Than $10 Million to Whistleblower
The Securities and Exchange Commission today announced an award of more than $10 million to a whistleblower who provided information and assistance that significantly contributed to a successful SEC enforcement action. The whistleblower provided important documents and met twice with Enforcement staff. The charges in the covered action had a close nexus with the whistleblower’s allegations, which were critical to the underlying investigation.

Charges withdrawn against former Legacy Iron Ore company accountant
Charges laid against former Legacy Iron Ore Ltd (Legacy) company accountant Karen Kwan have been withdrawn.
The prosecution had alleged that Ms Kwan, in co-operation with former Legacy managing director Sharon Kia Le Heng, stole approximately $725,000 from Legacy, an ASX-listed mining exploration company (20-311MR).

ESMA To Withdraw The Recognition Decisions Of Six Indian CCPs
The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, today announces that six central counterparties (CCPs) established in India will have their recognition decisions withdrawn in accordance with the European Market Infrastructure Regulation (EMIR).

FCA prosecutes five individuals for role in ‘all-or-nothing’ investment scheme
Following an application at Southwark Crown Court on 31 October 2022, two prosecutions for alleged investment fraud will be heard as a single trial of four defendants. This is listed to start on 6 February 2023 with a 6-8 week time estimate.

The Financial Market Entry Office
Japan Financial Services Agency
In order to expand Japan’s role as an international financial center, the Japanese Government is committed to making its capital markets more attractive with strategic initiatives and to creating an environment that attracts foreign businesses and highly-skilled foreign professionals. As a part of the initiatives, the Financial Services Agency (“FSA”) and Local Finance Bureaus (“LFBs”) established the “Financial Market Entry Office” (the “Office”) on January 12, 2021 to handle all the regulatory process from pre-application consultation, registration, to supervision after the registration for newly entering asset management firms as a single point of contact with all the communications available in English.

Investing and Trading

Twitter’s Credit Grade Cut by Moody’s Following Leveraged Buyout; The credit company lowered its rating two notches to B1; Social media giant’s ratings remain on review for downgrade
Olivia Raimonde – Bloomberg
Moody’s Investors Service lowered its credit rating for Twitter Inc. following the close of the social-media giant’s leveraged buyout by Elon Musk. The credit rating company cut Twitter two notches to B1, or four steps into junk territory, according to a statement Monday.

Twitter Is the Apple of Elon Musk’s Eye
Brad Stone – Bloomberg
Elon Musk’s now-completed acquisition of Twitter reminds me of the long-ago story of Steve Jobs’s return to a failing Apple. This week marks the beginning of a new chapter in the already long and twisty Elon Musk-Twitter saga. On Thursday, the Tesla Inc. chief visited Twitter’s San Francisco headquarters carrying a sink and then signaled he was ready to metaphorically throw it at the company itself. In the span of two eventful days, he completed the acquisition, sacked Twitter’s top brass and took over as “Chief Twit.”

Silicon Valley’s Share of Startup Deals Drops Below 20% for First Time; The decline comes as entrepreneurs and investors increasingly set up shop outside the tech mecca
Marc Vartabedian – Bloomberg
Silicon Valley accounted for less than 20% of deal making nationally in the third quarter, marking the steady erosion of the region’s grip on startups and venture capital as companies increasingly spring up throughout the country. As recently as the mid-2000s, Silicon Valley, long considered the startup capital of the world, was accounting for nearly a third of U.S. deal making, according to data from analytics provider PitchBook Data Inc. and the trade group National Venture Capital Association.

Nearly $1 Billion Swamps Junk-Bond ETF in Record Haul Before Fed; Billions have been poured into credit ETFs as risk assets rise; Risk-on rally may become a Fed-driven ‘head-fake’: Zaccarelli
Katherine Greifeld – Bloomberg
Exchange-traded fund investors are diving headfirst into high-yield debt just days before the Federal Reserve’s interest-rate decision. Risk assets of all stripes have been climbing as optimism builds around the Fed dialing back the pace of rate hikes after it delivers an expected fourth-straight, 75-basis-point rate increase Wednesday. The renewed appetite for risk has boosted equities and sent billions into credit ETFs despite lackluster corporate earnings.

Mortgage Giant Rocket Plunges Back to Earth, Hit by Rising Rates; America’s largest home lender harnessed a generation of low rates to refinance millions of mortgages. Its effort to switch focus is a challenge.
Ben Eisen – The Wall Street Journal
The mortgage industry turned from feast to famine faster than America’s largest home lender anticipated. Rocket Mortgage harnessed a generation of low rates to refinance millions of homeowners. Last year, it racked up more than double the refi volume of any other lender, accounting for more than $1 of every $10 lent out during a boom for the mortgage industry. Now the Federal Reserve’s efforts to fight inflation have sent mortgage rates soaring. And refinancing, the driver of Rocket’s business, no longer makes sense for many homeowners.

Grain Markets on Edge for Escalation After Russia Warns on Ships; Wheat spiked on Monday after Russia suspended deal involvement; Three more ships departed from Ukraine on Tuesday, UN says
Aine Quinn – Bloomberg
Grain markets steadied on Tuesday, with farmers and traders on alert for Russia’s next moves as ships continue to move through Ukraine’s safe-passage corridor despite repeated warnings from Moscow. Three more crop vessels departed Ukraine on Tuesday, the United Nations said, and the 12 ships that left yesterday have cleared the corridor safely. No new ships headed for Ukraine through the corridor. Wheat futures fell 0.9% in Chicago after surging 6.4% on Monday, and corn was little changed.

BP to buy back more shares after profit doubles to $8bn; Third-quarter earnings exceed estimates as calls grow for more aggressive taxation
Tom Wilson – Financial Times
BP announced further share buybacks after third-quarter earnings more than doubled to $8bn, leaving the energy group on course for one of the most profitable years in its history. Underlying profits for the three-month period were $8.2bn, up from $3.3bn a year earlier and far exceeding analysts’ average estimates of $6.1bn.

Saudi Aramco reports $42bn quarterly profit; State-run oil exporter benefits from high energy prices with second-highest net income since listing in 2019
Samer al-Atrush and Tom Wilson – Financial Times
Saudi Aramco reported its second-highest quarterly profits since listing its shares in 2019, as the world’s biggest oil exporter reaps a windfall from high energy prices. Net income at the state-controlled group was $42.4bn in the three months to September, up 39 per cent from the same quarter a year ago. Although the earnings were down from the record $48.4bn reported in the second quarter, Saudi Aramco has now reported profits of more than $130bn in the first nine months of the year.

Environmental, Social and Corporate Governance

Sustainable Switch
Sharon Kimathi – Reuters
“It’s the final countdown!” And yes, you should be hearing the legendary song by Swedish rock band Europe when reading that. The final countdown to the climate event of the year – COP27 – is here as the UN climate conference kicks off in Egypt on Sunday. So far, it’s all about who’s attending – or rather who isn’t. On the list of non-attendees are: British Prime Minister Rishi Sunak, King Charles and climate activist Greta Thunberg. At least Brazilian President-elect Luiz Inacio Lula da Silva will send representatives.

Waterlogged wheat, rotting oranges: five crops devastated by a year of extreme weather; Crops are struggling to grow – and produce the same yields – as they would under normal weather conditions
Cecilia Nowell – The Guardian
From Hurricanes Fiona and Ian, to flooding in eastern Kentucky and a record dry summer as the western US entered its 22nd year of a once-in-a-millennium megadrought, the US has already seen more than two dozen major climate disasters with losses exceeding $1bn (£864m). On top of this economic toll, extreme weather is also upending the food system in the US and much of the world. As the climate crisis causes temperatures to rise, precipitation patterns to shift and drought conditions to lengthen, many crops are struggling to grow – and produce the same yields – as they would under normal weather conditions. In some parts of the country, crops that require dry conditions are getting too much rain, while in others, they’re not getting enough.

Battling heat waves: The silent killer; Hurricanes get the headlines, but extreme heat causes more deaths than all other weather disasters combined. The right strategies can help save lives.
James Arnott and Greg Alvarez – Yale Climate Connections
Millions of TV viewers watched minute-by-minute coverage of Hurricane Ian blasting its path of destruction in Florida, Georgia and South Carolina. But while hurricanes are scary and deadly, extreme heat is a stealthy killer that causes more deaths than all other weather disasters combined. This summer, a record-breaking heat wave baked the western United States, with temperatures soaring past 110°F in some places.

Two-thirds of US money for fossil fuel pours into Africa despite climate goals; Joe Biden will fly to Africa to attend the Cop27 talks in Egypt but the US funnels billions to dirty projects in the continent
Oliver Milman – The Guardian
Joe Biden will head to Egypt next week to tout America’s re-emergence as a leader on the climate crisis at the Cop27 talks. But he will be landing in a continent that the US continues to pour billions of dollars into for fossil fuel projects, with seemingly no end in sight despite the president’s promises. The US government has funneled more than $9bn (£7.7bn) into oil and gas projects in Africa since it signed up to restrain global heating in the 2015 Paris climate agreement, a tally of official data shows, committing just $682m (£587m) to clean energy developments such as wind and solar over the same period.

Volkswagen brand will only produce electric cars in Europe from 2033 -brand chief
Victoria Waldersee – Reuters
The Volkswagen brand (VOWG_p.DE) will only produce electric cars in Europe from 2033, its boss Thomas Schaefer said on Wednesday, committing to an earlier date than its previous 2033-2035 target. Schaefer said in the coming decade the VW brand would narrow down the number of models on offer and raise the profit margin for all volume brands – Volkswagen, SEAT and Skoda, and commercial vehicles – to 8% by 2025.

US Carmakers Passing Up Lithium From Australia’s First Refinery; CEO says plant should comply with law despite China ownership; Asian and EU battery makers first in line for crucial material
James Fernyhough – Bloomberg
The head of Australia’s first lithium hydroxide refinery says it’s attracted little attention from US carmakers seeking to buy the metal that’s crucial to the world’s renewable energy revolution. That’s despite Tianqi Lithium Energy Australia’s plant being one of the few in the world producing lithium expected to be compliant with President Joe Biden’s new laws designed to break China’s stranglehold on the global battery supply chain.

Tesla Talked to Glencore About Buying Stake in the Miner; Discussions between the electric vehicle maker and the big cobalt producer were preliminary and didn’t result in any deal
Alistair MacDonald – The Wall Street Journal
Tesla Inc. decrease; red down pointing triangle held early-stage talks with Glencore PLC decrease; red down pointing triangle last year about buying a stake in the commodities giant, according to a person familiar with the matter. The electric vehicle maker’s interest came as manufacturers across the West look to secure supplies of so-called future-facing metals that are used in batteries and the renewable energy industry. A deal didn’t materialize from the talks, and those discussions are no longer active, the person familiar with them said. The Financial Times reported the talks earlier Monday.

What Really Happens When Emissions Vanish
Ben Elgin and Sinduja Rangarajan – Bloomberg
Many of the world’s largest companies are declaring breakneck progress in the fight against climate change. While their environmental handiwork shows up on paper, these gains often fail to materialize in the atmosphere. Procter & Gamble Co. vowed to cut its heat-trapping emissions in half by 2030, before announcing it had surpassed its target a decade early. Cisco Systems Inc. recently said it had exceeded a goal to reduce its climate pollution by 60% over 15 years. Continental AG, the German tire and auto parts juggernaut, claimed it had slashed greenhouse gases by an astounding 70% in 2020.

ESG Fund Labels Disappear in Japan as Clampdown Spooks Industry; No new fund has used the ESG label in last five months; Weak performance has also led to fund outflows in Japan
Satoshi Shizume and Sheryl Tian Tong Lee – Bloomberg
ESG is becoming a bit of a dirty acronym in Japan. In the last five months, no new fund has put “ESG” in its name, a sharp drop from roughly one a month for the past few years. Products still identify themselves as “green” or “impact” or “sustainable,” but since the Financial Services Agency signaled new regulations on ESG-labeled funds, asset managers have stopped using the shorthand for environmental, social and governance.


The world’s top quants might be in a distant desert
Zeno Toulon – Reuters
The Abu Dhabi Investment Authority announced yesterday that it had a bumper 2021, and it’s investing in tech to celebrate. ADIA’s quantitative research and development is headed up by Marcos Lopez de Prado, a superquant with career highlights at Citadel, the hedge fund Tudor Investment, and UBS. He’s also a university professor at Cornell. And a researcher at Lawrence Berkley national laboratory. De Prado’s ADIA team was estimated to be 50 strong in February this year. The secrecy of the fund makes it impossible to get frequent or reliable headcount figures, but at least three new people were recently added.

Credit Suisse Investors’ Choice: a Big Loss or a Bigger Loss; Buying into the Swiss lender’s share sale is a bet it’s reached rock bottom.
Paul J. Davies – Bloomberg
Credit Suisse’s $4 billion fundraising was always going to be painful for shareholders, but with a deep discount on the new stock, their choice is only about how much of their ownership they want to lose. The capital-raising plan was unveiled last week alongside a high-risk strategic overhaul, which still only promised a weak target for a 6% return on tangible equity in three years’ time, if things go according to plan. That is far below the 10% cost of capital assumed for big banks. It means Credit Suisse expects to be destroying value when its restructuring is done.

Credit Suisse Is Not For Sale, Chairman Says; Swiss lender is not open to takeover discussions: Lehmann; Lehmann speaks with Bloomberg Television in Hong Kong
Ambereen Choudhury, Yvonne Man and Marion Halftermeyer – Bloomberg
Any bargain hunters hoping to snap up Credit Suisse Group AG now that the lender’s revamp has pushed its stock down yet again may find themselves getting short shrift in Zurich. “We are going to thrive again, so we don’t have any takeover discussions,” Credit Suisse Chairman Axel Lehmann said in an interview with Bloomberg Television in Hong Kong on Monday. “We want to stay independent.”

Wells Fargo Is in Talks With US Watchdog to Settle a Number of Inquiries
Hannah Levitt – Bloomberg
Wells Fargo & Co., which set aside $2 billion last quarter to deal with legal matters, said it’s in talks with the Consumer Financial Protection Bureau to resolve investigations. The negotiations cover “a number of CFPB investigations, inquiries and other matters,” including cases involving automobile lending, consumer-deposit accounts and mortgage lending, the San Francisco-based firm said Monday in a regulatory filing.

Bond Rout Forces Japan Regional Bank Into Alternative Assets; Yamaguchi Financial’s challenges highlight yield hunt in Japan; Foreign bond holdings may be big issue for regional banks
Taiga Uranaka and Takako Taniguchi – Bloomberg
The spike in interest rates globally is rocking the investment portfolio of a century-old regional bank in Japan and forcing it to overhaul its strategy. Yamaguchi Financial Group Inc., with a $7.3 billion portfolio that far eclipses its market capitalization, has slashed its bond holdings after getting stung by the pace of market moves. Now, it’s looking to invest in less liquid but higher-yielding assets like private REITs and corporate bonds issued by Japanese and foreign companies. The lender is also on the hunt for private equity opportunities and stocks that pay high dividends.

Bank of America’s Trading Staff Can Work Remotely Only Two Days a Month
Katherine Doherty – Bloomberg
Bank of America Corp. has told its global markets employees that they’re required to be in the office almost every day as the Wall Street firm seeks to restore some of the culture that prevailed before the pandemic. Equities and fixed-income traders were informed they can work remotely two days a month, the people said, asking not to be identified discussing a private matter. The team is predominately based in New York, while some work on international desks.

Bank of America Names Cady Head of Americas Financial Sponsors
Gillian Tan – Bloomberg
Bank of America Corp. named Adam Cady head of its Americas financial sponsors group, and Filip Rensky as vice chair of global financial sponsors, according to a memo seen by Bloomberg News. The Charlotte, North Carolina-based bank is seeking to drive market share, Kevin Sherlock and Saba Nazar, co-heads of global financial sponsors, wrote in the memo, the contents of which were confirmed by a BofA spokesman.

What Saudi Arabia’s Biggest Bank Wants With Credit Suisse
Stephen Kalin and Margot Patrick – The Wall Street Journal
Saudi Arabia’s largest bank will soon be the biggest investor in Credit Suisse AG increase; green up pointing triangle and wants to bring the Swiss lender deeper into the kingdom’s booming financial markets while expanding ties to rich Middle Easterners. “We think it would be synergistic to both sides if we could get them more involved in the Saudi market,” Saudi National Bank Chairman Ammar al-Khudairy said.

Banks don’t love the FDIC’s ombudsman proposal for appeals process
Claire Williams – American Banker
The Federal Deposit Insurance Corp. didn’t assuage banks’ concerns when it suggested that an ombudsman oversee the agency’s appeals process for banks. Bank groups were irate earlier this year when acting FDIC Chairman Martin Gruenberg disbanded an internal court for banks to challenge supervisory findings, and instead reinstated a board-controlled committee. The board-controlled committee, or the Supervision Appeals Review Committee, is less transparent than the industry would like, and more importantly, would still ultimately answer to the FDIC’s board.

Credit Suisse plans to push ahead with China expansion after overhaul
Selena Li – Reuters
Credit Suisse (CSGN.S) is forging ahead with expansion in China, with the country and Hong Kong set to see strongest pace of headcount growth in Asia, its regional head said, even as the Swiss bank’s turnaround strategy leads to job losses elsewhere. Battered by years of scandals and losses, Credit Suisse is raising new capital for an overhaul, which will see thousands of job cuts and shift its focus away from investment banking and towards the less volatile wealth management.

Credit Suisse unveils details of $4 billion capital raising plan
John Revill – Reuters
Credit Suisse on Monday unveiled details of its plan to raise 4 billion Swiss francs ($4.01 billion) from investors to support the embattled bank’s bid to tackle the biggest crisis in its 166-year history. Switzerland’s second-biggest lender is raising new capital to fund an overhaul, which will see it cut thousands of jobs and shift its focus away from investment banking and towards the less turbulent area of wealth management.

Want to Invest in Crispin Odey’s Main Hedge Fund? Too Bad, It’s Closed to New Clients; European fund gained 193% so far this year after gilt turmoil; Existing investors can still add money, fund says in statement
Loukia Gyftopoulou and Nishant Kumar – Bloomberg
Crispin Odey has closed his flagship hedge fund and two others to new clients, hoping to keep assets at a manageable level following a record year. The main Odey European hedge fund, as well as the OEI MAC and Odey Swan funds, are no longer accepting new investors, his firm said in an announcement on its website dated Oct. 26. Existing clients can continue to add money.

TP ICAP Gets Boost From Frenzied Rates Market, Strong US Dollar
ByJoe Easton and Leonard Kehnscherper – Bloomberg
TP ICAP Group Plc said its broking business has benefited from higher volatility in rates trading and the continued strengthening of the US dollar. Global Broking revenue was up 12% in the third quarter, the London-based company said in a trading update Tuesday. The surge was driven by “favorable market conditions” in rates trading, the broker’s largest and most profitable asset class. TP ICAP said it also got a fillip from the strong US dollar with about 60% of the group’s revenue denominated in dollars.

Wellness Exchange

Poultry Lockdown Looms in England to Thwart Spread of Bird Flu; Farmers given mandatory order to keep their birds indoors; Number of bird flu cases reached record over the past year
Agnieszka de Sousa – Bloomberg
Poultry farmers in England have been ordered to keep their birds indoors as the country battles the worst-ever outbreak of avian influenza. New mandatory measures will require all poultry and captive birds to be kept indoors, the Department for Environment, Food and Rural Affairs said Monday. The order will become effective on Nov. 7.

Regular exercise may improve the effectiveness of coronavirus vaccines; Exercisers who were vaccinated were about 25 percent less likely to be hospitalized with covid than sedentary people who received the same vaccine, a new study found
Gretchen Reynolds – The Washington Post
Regular exercise could amplify the benefits of your next coronavirus vaccination or booster, even if you schedule your shot weeks or months from now, according to a new study of the effects of regular physical activity and vaccines.

RSV Vaccine Protected Infants From Severe Cases, Pfizer Study Finds; Pfizer says results are sufficient to seek approval for the shot, which could be the first deployed against the common respiratory virus
Joseph Walker – The Wall Street Journal
An experimental vaccine from Pfizer Inc. significantly reduced the risk of infants developing severe cases of a respiratory virus that kills hundreds of children each year, according to the company. Among mothers who received the vaccine for the respiratory syncytial virus, their infants had an 81.8% lower risk of developing severe lower respiratory tract infections requiring medical attention within three months of birth than infants whose mothers received a placebo, Pfizer said Tuesday.

JPMorgan Launches Life-Sciences Venture Group; New investment team to back early- to growth-stage companies
Brian Gormley – The Wall Street Journal
JPMorgan Chase & Co. has launched a healthcare venture-capital practice, entering the market at a time when innovation in the life sciences remains high but investment has pulled back from last year’s record pace. The largest U.S. bank by assets has created a venture team targeting the life sciences through J.P. Morgan Private Capital, a growth-equity and private-credit investment group within J.P. Morgan Asset Management.


Japan Asks If It’s Better to Flip Burgers Than Work at a Megabank; The weak yen makes the wages of Japan’s long-suffering workers seem absurdly low.
Gearoid Reidy – Bloomberg
In the 1840s, tens of thousands of immigrants descended upon California seeking gold to make their fortune. Might Japanese youths looking to flip burgers be next? It’s a facetious thought, but Japanese media is nonetheless all agog to learn that, thanks to new legislation, workers in fast-food restaurants in the Golden State may soon earn $22 an hour. At current yen levels, that amounts to nearly 3,300 yen – or close to four times Japan’s average minimum wage.

Japan Looks 6,000 Meters Under the Sea for Rare Earths to Counter China, Report Says; Government plans to counter China’s dominance of the minerals; Japan to start study mining methods near Ogasawara islands
Annie Lee – Bloomberg
Japan is looking 6,000 meters under the sea for rare earths to counter China’s dominance of the critical minerals that are used in everything from smartphones to weapons, according to the Yomiuri newspaper. The government intends to start developing the methods necessary to extract the elements near the Ogasawara islands in the fiscal year beginning in April, and aims to begin prospecting within five years, the newspaper reported, citing unidentified officials.

Super-Rich Get Rare Chance to Join Singapore’s Billionaire Row; Nassim Road has the most sought-after homes in the city-state, and a rare sale of three mansions is expected to fetch record prices.
Yoojung Lee and Pei Yi Mak – Bloomberg
It’s a rare moment for Singapore’s luxury property market. Three of the city-state’s most prestigious homes, known as good class bungalows, are on sale in a quiet central neighborhood where only five such mansions have changed hands over the past five years. The coveted residences are expected to fetch a record price of almost S$240 million ($168 million) combined after prospective buyers submit bids by Nov. 3.

Chinese cities clamp down on COVID as cases rise before winter season
Officials in Chinese cities and provinces across the country are pulling no punches in stamping out sporadic COVID-19 outbreaks as winter nears, quickly closing venues and enforcing longer temporary lockdowns on millions of people. Cases in mainland China hit 2,898 on Sunday, topping 2,000 for a second straight day and pressuring the country’s controversial zero-COVID policy, which has hamstrung the economy and exasperated its citizens.

India uses e-rupee to settle 2.75 billion rupees of govt bonds
Dharamraj Dhutia – Reuters
The Reserve Bank of India’s central bank-backed digital rupee was used to settle secondary market transactions in Indian government bonds worth 2.75 billion Indian rupees ($33.29 million) as part of a pilot, data on Tuesday showed.

Europe Faces ‘Big Hit’ From Loss of Russia Oil, Says Italy’s Eni; continent will have to rely on extra supply from US: Descalzi; Lack of new projects means oil market remains ‘very tight’
Anthony Di Paola and Manus Cranny – Bloomberg
Europe will have to rely on extra oil from the US next year to make up for a loss of supplies from Russia, according to Eni SpA. The European Union is set to ban seaborne imports of Russian crude from Dec. 5 and refined products in February, as it seeks to punish Moscow for the invasion of Ukraine. Flows to the bloc will probably decrease by 2 million barrels a day, Claudio Descalzi, chief executive officer of the Italian energy company, said in an interview with Bloomberg in Abu Dhabi.

Mexico, US Plan Clean-Energy Hub Along Border, AMLO Says; ‘Sonora Plan’ to involve five solar plants, lithium production; Looking to rehabilitate car plants for electric vehicles
Max de Haldevang – Bloomberg
Mexico and the US are working on ambitious plans to turn parts of the border region into a clean energy hub, replete with solar and wind plants, lithium mining and electric vehicle factories, President Andres Manuel Lopez Obrador said Monday. Mexico is looking to build five large solar plants, to help remodel car factories for electric vehicles and produce batteries and semiconductors in the state of Sonora, which shares nearly 600 kilometers (370 miles) of border with the US, Lopez Obrador, known as AMLO, said at a daily press conference.

Mississippi River Drought Is Pushing Soybean Shippers to Texas; Shallow water makes it difficult to float barges in some areas; River-shipping crisis hits as farmers seek to transport crops
Michael Hirtzer – Bloomberg
The shrinking Mississippi River has hobbled the most efficient channel for moving US soybeans onto world markets, prompting a pivot to alternatives from Puget Sound to Texas to the Great Lakes. Typically, more than half of all US soybean exports traverse the Mississippi River but after weeks of scant rainfall, water depths have dwindled, raising barge costs to an all-time high. As a result, ports in places like southeast Texas that normally handle less than 5% of the nations soybean exports are being thrust into action.

Rising Interest Rates Threaten to Expose Office Buildings’ Inflated Values; Building prices fall and defaults rise amid Fed efforts to fight inflation
Konrad Putzier – The Wall Street Journal
Cheap debt fueled a decadelong boom in U.S. office values, offsetting the impact of years of rent increases that didn’t keep pace with inflation. Now that the long period of easy credit is over, office-building owners are bracing to see how much less their properties are actually worth. The prices of some aging office towers in places such as New York and Chicago have already fallen by about a quarter as potential buyers struggle to land financing with interest rates rising fast, brokers and lenders say. Defaults are starting to move up from low levels.


Work-From-Home Trend May Have Peaked, LinkedIn Survey Finds; The social network also found a growing disconnect between what employees want and what their employer demands.
Helen Chandler-Wilde – Bloomberg
Remote working may have peaked in the UK as a loosening labor market hands power back to employers, according to research by LinkedIn. In September, 12% of UK jobs advertised on the site were remote, compared with 16% in January, as “paranoid” employers worry about the productivity of working from home, said Josh Graff, the managing director of LinkedIn for EMEA and Latin America.

CFA Final Exam Pass Rate Slips to 48% While Remaining Above Pandemic Lows
Katherine Doherty – Bloomberg
The pass rate for the final level of the chartered financial analyst exam declined while remaining above the historic lows from last year, when the pandemic disrupted testing. In August, 48% of candidates successfully finished the series, down from 49% for those who sat for the exam in May but still higher than the historic low of 42% for passing Level III that was set last year. The 10-year average success rate for the final exam is 52%, according to the CFA Institute.

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The Spread

Meme-Stock Mania Is Hitting the Options Market, Too

Observations & Insight Derek Haworth of BornTec Emphasizes Data Integrity and Operational Resilience at FIA Conference In an interview with John Lothian News at the FIA International Futures Industry Conference in Boca Raton, FL, Derek Haworth,...

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The Thrill Factor Is Back for Retail Investors

The Thrill Factor Is Back for Retail Investors

First Read Hits & Takes John Lothian & JLN Staff The ebb and flow of exchanges continues. Yesterday we heard more about FMX's plans to take on the big bad CME Group, using a plan similar to one that has failed during assaults on the Chicago powerhouse in the...