Hits & Takes
The boys are back in town, or in the City at least, I should say. The JLN team arrived safely in London via 3 different airlines on Sunday. We are here for IDX this week and staying a 15 minute walk away from The Brewery, where the conference is to be held.~JJL
Mark Ibbotson, non-executive chairman at GH Financial, is up to 51% of his goal of £14,000 in the kilt challenge for Futures for Kids. So far he has raised £7,279.49. Please help him make his goal.~JJL
Here’s a different wrinkle in the trade wars. Canadians horrified to learn some maple syrup is from … the US.~JB
Don’t hold back, Jeff. Tell us what you really think. Renowned Economist Jeffrey Sachs Rips Trump As A Gibbering, ‘Delusional’ Threat.~JB
There was in issue on Friday with the link for the New York sessions for MarketsWiki Education World of Opportunity in the initial email sent out. The issue has been fixed on the www.marketswikieducation.com website. Hats off to Fidessa, who was the first firm to sign up in both Chicago and New York. ~JJL
I know there are a lot of crypto conferences, it seems one every day or at least week. But the Crypto Evolved conference on June 27 in New York at the New York Athletic Club is not to be missed. There is a great line up of speaker to address this question, “As Wall Street Meets Silicon Valley, Who Will Dominate the New Crypto Currency Frontier?” There is a special link for readers of this newsletter with a 15 percent discount. Sign up and I will see you there.~JJL
How to Fix a Holy Banking Mess? Boot the Priests, Bring in the Bankers; The transformation of CajaSur is testament to the slow-motion banking recovery in much of the eurozone
Jeannette Neumann and Max Colchester – WSJ
Catholic priest Fernando Cruz Conde carries a rare distinction: He is among the few bankers who paid a price for his role in the financial crisis. Eight years ago, Spanish taxpayers bailed out a small bank controlled by the Spanish Catholic church after a real-estate binge came to a crashing halt. Regulators ousted Father Cruz Conde and Córdoba’s other banker-priests and slapped them with fines for their financial mismanagement.
***** Are the banker-priests money lenders?~JJL
Pope summons oil execs to Vatican to talk climate change
Nicole Winfield And Seth Borenstein – AP News
Pope Francis will meet with some of the world’s oil executives next week, likely to give them another moral nudge to clean up their act on global warming.
Climate change policy and science experts are cautiously hopeful but aren’t expecting any miracles or even noticeable changes.
***** It would be interesting to be a fly on the wall in that room. ~JB
Being the boss is not always good: power taints how we interact with others; Abusive leaders cause suffering not only for their employees, but also for themselves
Trevor Foulk – London School of Economics and Political Science
Lord Acton’s quote that “power corrupts, and absolute power corrupts absolutely” probably conforms to most of our experiences with powerful people. People who feel powerful tend to be self-focused, less empathetic, a little more rude or pushy, and just generally difficult to deal with. While most people generally understand that power makes others more difficult to deal with, one thing that’s not clear is how does feeling powerful affect power holders themselves?
***** “Once you start down the dark path, forever will it dominate your destiny, consume you it will.” ~ Yoda
Self-Certifications; Virtual Currencies; Summary Suspensions; Spoofing
Gary DeWaal – Bridging the Week
The Commodity Futures Trading Commission issued guidance to registered trading facilities and clearinghouses related to the listing of new derivatives contracts based on virtual currencies that contained a cryptic warning, while two ongoing federal court litigations – one of which on its face has nothing to do with crypto assets and is now headed to an appellate court – potentially will conclude with important statements about the Commission’s authority to bring anti-fraud actions against purported miscreants involved with spot cryptocurrencies. Separately, CME Group summarily suspended an apparent foreign broker from accessing any of its markets for at least 60 days for purportedly not fully cooperating with ongoing investigations and reporting positions incorrectly to carrying member futures commission merchants – potentially causing the FCMs themselves to report positions incorrectly.
Friday’s Top Three
Our top story on Friday was also our MarketsWiki Page of the Day – Los Angeles Times’ Ed Wedbush, fixture of L.A. finance, steps down from his troubled firm. Second was from Jim Kharouf for JLN, Can tZERO and BOX Digital Markets change the face of capital markets?. In third was Bloomberg’s Investors in Their Pajamas on Other Side of the Trade in China
127,158,681 pages viewed; 23,133 pages; 213,232 edits
G-7 Members Condemn U.S. Trade Actions; Ministers of developed nations express ‘unanimous concern and disappointment’ with U.S. tariffs
Joshua Zumbrun – WSJ
Six finance ministers, representing some of the closest allies of the U.S., issued a stern rebuke of the protectionist policies of the administration of President Donald Trump, signaling a deep rift in the relations underpinning the post-World War II trading system.
Banks and brokers suffer ‘dramatic’ fall in commissions; Asset managers cut fees for share trading after introduction of Europe’s Mifid II rules
Attracta Mooney and Hannah Murphy – FT
Investment banks and brokers across Europe have suffered a “dramatic” fall in the fees asset managers pay them to buy and sell shares in a sign of how the recently introduced Mifid II rules have shaken up markets.
Trump Taps GOP Senate Aide for SEC Seat; Elad Roisman is the chief counsel to the Senate Banking Committee
Andrew Ackerman – WSJ
President Donald Trump plans to nominate a top aide to the Senate Banking Committee chairman for a GOP opening on the Securities and Exchange Commission, the White House announced late Friday.
The Next Threat to Oil Prices: China
Nathaniel Taplin – WSJ
Oil prices have had a spectacular run, rising by nearly 50% since last July, thanks to a potent mix of OPEC discipline, geopolitical risk and strong demand. The rally has moderated in the past couple of weeks, thanks to concerns OPEC’s resolve on supply cuts is weakening just as U.S. oil production is showing renewed signs of vigor. What investors may not appreciate is that demand growth is also poised to slow in the world’s largest net oil importer last year, China.
Major bank CEOs say blockchain will underpin the financial industry ‘in five years’
Sam Meredith – CNBC
Blockchain technology could soon revolutionize the global banking industry, according to the chief executives of two major European lenders.
Banks have invested millions in developing blockchain applications in recent years, as part of a broader industry effort to try to cut costs and simplify their back-office processes. The technology, which is perhaps better known as the software powering cryptocurrencies such as bitcoin, was initially treated with skepticism by international lenders.
Cayman court finds Saudi companies complicit in $126bn fraud; Ahab and Saad groups involved in one of the ‘largest Ponzi schemes in history’
Simeon Kerr — Dubai – FT
A Cayman Islands court has found that two Saudi businesses were complicit in a $126bn fraud that it described as one of the “largest Ponzi schemes in history” when it ruled on a multibillion dollar dispute that sent shockwaves through the kingdom.
U.S. Steel And Aluminum Tariffs Are ‘Illegal,’ EU Trade Commissioner Says
Bill Chappell – NPR
After U.S. tariffs on imports of European steel and aluminum took effect Friday morning, the EU’s top trade commissioner called them “illegal” and a classic case of protectionism. The EU plans to make its case to the World Trade Organization.
Central Bankers Versus the Market: Who Would Lend Better?; A radical idea from the 1930s about controlling credit growth is being put to a vote in Switzerland
Paul J. Davies – WSJ
Imagine giving a committee of central bankers direct control of how much lending happens in an economy.
They’re Richer Than Ever, But Danes Are Sitting on Their Wealth
Frances Schwartzkopff – Bloomberg
In the world-record holder of negative rates, there’s been another eye-catching development. Danes are richer than ever before, according to central bank data on savings and home equity. But they’re spending less, in relative terms. The gap between private consumption and household wealth is the biggest it’s been in three decades.
Jacob Wallenberg says Trump trade stance undermines investments; Leading European industrialist warns US action puts global supply chains at risk
Richard Milne, Nordic Correspondent- FT
One of Europe’s leading industrialists has warned that the US decision to slap tariffs on steel and aluminium and the growing prospect of a trade war will force businesses to question their investment plans.
Commodities trading booms as new strategy emerges; Risk premia investing is attracting tens of billions of dollars, a boon for banks
Gregory Meyer in New York – FT
A class of investors who have put tens of billions of dollars into commodities over the past few years does not care whether the prices of oil, wheat, cattle and the rest go up or down.
Wall Street, Hedge Funds Add Social Media to Research Menu; Alternative data provider M Science buys social-media miner TickerTags
Telis Demos – WSJ
Wall Street is taking another step toward making social media as core to investment research as quarterly sales reports.
Scandals Shake Confidence in Australia’s Once-Calm Banking Industry; Country’s financial intelligence agency levels $530 million fine against Commonwealth Bank of Australia
Robb M. Stewart – WSJ
The thousands of dollars that had moved in and out of an account at Australia’s biggest bank was unusual. The account’s holder had not only left the country in 1999 and not returned since, but had also been charged in Lebanon in 2004 with belonging to a terrorist organization and planning terror attacks.
Exchanges, OTC and Clearing
DGCX Reports Record Monthly Volumes As Shari’ah Spot Gold Continues To Shine
The Dubai Gold and Commodities Exchange (DGCX) witnessed its best month ever, recording volume of 2,163,598 lots valued at over USD 46.11 billion. Throughout May an average of 94,069 contracts traded per day showing year-on-year (YOY) growth of 51%. The world’s only exchange-traded Shari’ah Compliant Spot Gold contract (DGSG) also continued to shine, with over 488 kilograms of gold worth USD 20.72 million executed since its listing on DGCX on March 29th.
OCC Cleared Contract Volume Increased Eight Percent in May; Equity options volume up 12 percent in May and average daily volume up 26 percent year-to-date; ETF options volume up 12 percent in May and average daily volume up 29 percent year-to-date; Securities lending activity up 14 percent in May and 23 percent year-to-date
OCC, the world’s largest equity derivatives clearing organization, announced today that total cleared contract volume in May reached 411,264,931 contracts, an eight percent increase from May 2017 volume of 380,010,098. OCC’s year-to-date average daily cleared contract volume is up 25 percent from 2017 with 21,321,765 contracts compared to 17,079,884 contracts in 2017.
EEX trading results for May 2018
EEX achieves monthly record in Phelix-DE Futures and EUA
In May 2018, the European Energy Exchange (EEX) increased volumes on its power derivatives markets by 23% to 306.9 TWh (May 2017: 248.7 TWh) which is the highest volume since March 2017.
DTCC ADDS TWO NEW MEMBERS TO BOARD OF DIRECTORS
New York/London/Hong Kong/Singapore/Sydney, June 4, 2018
Press Release via email – no link
The Depository Trust & Clearing Corporation (DTCC), the premier post-trade infrastructure for the global financial services industry, today announced the election of two new members to its Board of Directors during the firm’s Annual Shareholders Meeting.
The new directors are Claudine Gallagher, Americas Regional Head for the Securities Services business of BNP Paribas, and Joseph Molluso, Executive Vice President and Chief Financial Officer of Virtu Financial.
Boerse Stuttgart generates turnover of around EUR 6 billion in May
Trading volume in all asset classes up on previous month
According to its order book statistics, Boerse Stuttgart generated turnover of around EUR 6 billion in May 2018.
Securitised derivatives accounted for the largest share of the turnover. The trading volume in this asset class was around EUR 2.7 billion. This represents an increase of 18 percent in comparison with the previous month. Leverage products generated turnover of more than EUR 1.5 billion – an upsurge of around 9 percent on the same period of the previous year. https://goo.gl/eyB98k
Citigroup: Big Bank, Big Spender on Tech
Telis Demos – WSJ
Citigroup spent $8 billion on technology in 2017, easily more than was invested by venture capital across all U.S. financial technology startups last year.
Growing Demand for Data Storage Sends Taiwan Stock Up 204%
Yu-Huay Sun – Bloomberg
A Taiwanese maker of compact discs and portable hard drives has captured the attention of investors on plans to expand into data storage for cloud computing. Ritek Corp. has surged 204 percent since announcing on May 7 an agreement to manufacture discs that can hold as much as 300 gigabytes of data for Panasonic Corp. That’s the best performance among the almost 900 members of Taiwan’s benchmark Taiex.
Google to disclose ethical framework on use of AI; Industry leader faces tough questions over how it already applies technology
Richard Waters in San Francisco – FT
An attempt by Google to put ethical guardrails around its future use of artificial intelligence is set to raise uncomfortable questions about how it already applies the technology, according to AI experts.
Stanford to step-up teaching of ethics in technology; University that helped spawn Silicon Valley responds to criticism of tech industry
Andrew Jack and Hannah Kuchler – FT
The university at the heart of Silicon Valley is to inject ethics into its technology teaching and research amid growing criticism of the excesses of the industry it helped spawn.
A future society driven by tech must have freedom at its heart
Michael Hayman – City AM
Spotify knows your own taste in music better than you do. It’s the promise made by predictive technologies and artificial intelligence (AI) – and it was the claim made to a recent gathering of Europe’s leading investors in technology.
China ‘insurtech’ pioneer ZhongAn loses lustre on bubble worries; Former high flyer backed by Tencent and Ant Financial now 12% below IPO price
Gabriel Wildau in Shanghai – FT
Eight months after its much-heralded initial public offering in Hong Kong, ZhongAn Online Property & Casualty, the fintech insurer backed by China’s two biggest internet tycoons, is struggling to meet lofty expectations, highlighting concerns about a China tech bubble.
ARQA Technologies Expands Its OMS Solutions Into European Markets, Powered By QuantHouse Data And Hosting Services
ARQA Technologies, one of the major players in technologies for financial markets, continues developing solutions for the European markets for complex trading infrastructures, powered by QuantHouse data and hosting services. The new opportunities are the result of high demand for ARQA OMS – a classic OMS for sell-side companies which use Sales&Trading approach in servicing clients.
BNP Paribas and Fidessa partner to provide buy-side clients
with derivatives workstation
Fidessa group plc (LSE: FDSA) and BNP Paribas have entered into a partnership through which the bank will provide its buy-side clients with access to Fidessa’s award-winning futures and options workstation.
ICAP Information and Thomson Reuters extend their 19901 Partnership
New York, June 4 2018: ICAP Information, the leading global supplier of over-the-counter financial data, has announced a five-year extension to its long-standing relationship with Thomson Reuters to provide USD Interest Rate Swap (IRS) data on the Reuters Capital Markets 19901 service.
China’s Internet Giant Baidu Reveals Energy-Efficient and Highly-Scalable ‘Super Chain’ Blockchain Protocol
Amrit Mirchandani – Toshi Times
Baidu is seen to be using Blockchain in many of its services. The latest was a solution to the high energy consumed by cryptocurrency mining. Speaking at an event in China, Xiao Wei the chief scientist at Baidu’s Blockchain division has announced a protocol that will resolve issues related to the energy consumed while mining cryptocurrencies.
Hyperchain Blockchain Creator Completes $234 Million Funding Round
Wolfie Zhao – CoinDesk
Qulian Technology, a China-based blockchain platform developer, has announced the completion of a 1.5 billion Chinese yuan ($234 million) Series B funding round.
According to an announcement from Qulian on Sunday, the news comes just a week after the deal’s lead investor Xinhu Zhongbao, a Shanghai-listed real estate and finance firm, first disclosed its plan to invest in the project in a filing with the Shanghai Stock Exchange on May 27.
eToro approaches investment banks over IPO; Any deal could serve as a bellwether of investor sentiment towards companies with exposure to the crypto market
Samuel Agini and Paul Clarke – Financial News
Social trading platform eToro has been holding talks with investment banks about a potential initial public offering — a deal that could serve as a test of institutional investor appetite for companies with exposure to the growing cryptocurrency market.
Blockchain start-up raises more than $4bn; Auction shows strength of investor demand for cryptocurrencies
Nicole Bullock in New York – FT
A blockchain start-up has raised more than $4bn in a year-long auction, topping nearly all initial public offerings this year in the latest testament to demand for ways to participate in cryptocurrency.
A top crypto hedge fund lawyer explains the 4 main trading strategies that funds use to make money
Oscar Williams-Grut – Business Insider
Cryptocurrency hedge funds favour four main strategies and we are unlikely to see many above $150 million in assets, according to a leading industry lawyer.
Chinese Firm Reportedly Nets $18 Million in ‘Questionable’ Token Sale
Wolfie Zhao – CoinDesk
A Chinese healthcare firm has reportedly raised 120 million yuan ($18 million) by issuing a custom cryptocurrency, despite China’s 2017 ban on initial coin offerings (ICOs).
According to an Investor China report on Monday, the company involved – called Zhaoyun Group and apparently based in Hangzhou – focuses on the healthcare and scientific research industry.
Investment Bankers Wait on Sidelines for Crypto Regulatory Clarity
Matt Whittaker – ThirtyK
As the nascent cryptocurrency industry gains in popularity and size, will more investment bankers be willing to work in this risky space? Perhaps, if the current regulatory picture becomes less murky.
Typically, investment bankers, long the pillars of Wall Street, advise companies on mergers, acquisitions or going public in an initial public offering, or IPO, all of which have clear rules and regulations.
But then there are initial coin offerings (ICOs), which could provide bankers with another, riskier, revenue stream. That’s why most are watching from the sidelines.
How cryptocurrencies became common currency in Southeast Asia; Cryptocurrencies are no longer the sole domain of hedge fund managers and high-stakes traders – in Southeast Asia they are being used to solve the financial problems of working men and women
Coco Liu – South China Morning Post
It is hard to say if Sachaknisay Sov is rich or poor. He lives in a rented room in rural Cambodia without a kitchen, but he does have something in common with many millionaires.
Trump Leaking Confidential Data Isn’t a ‘So What?’; It’s not surprising that Trump decided to play fast-and-loose with jobs data. It’s still wrong.
Timothy L. O’Brien
The federal jobs data that the Bureau of Labor Statistics releases on the first Friday of each month at 8:30 a.m. Eastern time moves markets. Anyone with inside information on the results — did the economy add or lose jobs? — could easily profit off it.
Trump’s ‘America First’ Disrupts Yet Another European Project
Richard Bravo and Bryce Baschuk – Bloomberg
France’s Macron is seeking a joint effort to update the WTO; EU trade commissioner warns ‘the system may collapse’
Efforts by European leaders including French President Emmanuel Macron to reform global trade rules are hitting a snag as the U.S. rattles trans-Atlantic relations with its “America First” approach to foreign policy.
G7 countries condemn US in rebuke over tariffs; Bitter rift in democratic alliance after escalating tensions over Trump trade policies
Sam Fleming and Kadhim Shubber in Washington – FT
Donald Trump will receive a cool reception from the G7 this week after US allies condemned his tariffs on steel and aluminium in a remarkable public rebuke of the group’s most powerful member.
China Opens Europe Charm Offensive as Trump Stokes Trade Dispute
Keith Zhai and Peter Martin – Bloomberg
China ‘always ready to listen to EU suggestions,’ says envoy; Officials preparing EU-China summit set for Beijing in July
China is reaching out to Europe with pledges to improve market access for companies in a charm offensive that contrasts with President Donald Trump’s escalation of trade disputes worldwide.
As Trump Riles Europe on Trade, Putin Offers More Natural Gas
William Wilkes and Ewa Krukowska – Bloomberg
Pipeline to Germany moves ahead despite U.S. sanctions threat; Gazprom on track for record gas sales to Europe this year
As Donald Trump’s trade policy risk worsening economic conflict with Europe Union, Russia’s Vladimir Putin is strengthening ties with the region.
Donald Trump picks the wrong trade fight; America should focus on digital innovation rather than squabble over peanut butter
Rana Foroohar – FT
If you want to understand Donald Trump and his recent trade sanctions on Europe, Canada and Mexico, you could do worse than to study professional wrestling. Unlike rules-based boxing, pro wrestling purports to be a no-holds-barred morality play.
Fed Makes a Risky Bet on Banks
The Editorial Board – NY Times
That banks can’t be completely trusted to judge the risks they take was a painful lesson regulators learned from the Great Recession. Or so it seemed.
ASIC temporarily extends relief for managed investment and superannuation schemes for certain disclosure obligations
ASIC has extended two ASIC instruments to allow additional time to consider the policy position in relation to certain disclosure obligations of managed investment schemes and superannuation trustees.
SEC Charges 13 Private Fund Advisers for Repeated Filing Failures
The Securities and Exchange Commission today announced settlements with 13 registered investment advisers who repeatedly failed to provide required information that the agency uses to monitor risk.
China Launches Probe of Foreign Chip Makers
Yoko Kubota – WSJ
Chinese regulators are investigating memory-chip makers Micron Technology Inc., MU 2.00% Samsung Electronics Co. and SK Hynix Inc., 000660 -1.75% all three of which said State Administration for Market Regulation officials have visited their China offices recently.
The regulator didn’t immediately respond to a request for comment.
SocGen reaches deal to resolve Libya and IBOR rates probes
French bank Societe Generale (SOGN.PA) said on Monday it had reached agreements in principle with U.S. and French authorities to resolve probes on its transactions in Libya and on its handling of the ‘IBOR’ money market rates.
Big equity funds accused of breaching EU disclosure rules; Fidelity, Standard Life Aberdeen and Janus Henderson targeted by campaign group
Owen Walker – FT
Up to a third of large equity funds offered to European investors have been accused of breaching EU market rules over providing comparable performance data.
Japan’s finance minister to forego one year’s pay over scandal
Japanese Finance Minister Taro Aso will take a year’s pay cut to take responsibility for officials under him who altered documents on a cut-price land sale to a school with links to Prime Minister Shinzo Abe and his wife Akie.
Investing and Trading
LNG and the Importance of the Henry Hub Benchmark
CME Group OpenMarkets
Unlike solid forms of energy coaxed from the earth — such as crude oil and coal — the odorless vapor known as natural gas is positively invisible.
How leaving the Paris climate deal will cost the U.S. trillions of dollars
Agnes Walton – Vice
When President Trump announced the U.S. was leaving the Paris Climate Agreement, he promised to save trillions of dollars in climate spending. But a year after his historic decision, Trump’s promise could become a costs nightmare.
What I Did at Summer Camp: Stocks and Personal Finance!; Investing-focused camps continue to expand, as young adults still struggle with money issues
Jane Hodges – WSJ
At some summer camps, the boys and girls will be skipping the campfire songs and three-legged races. Instead, they’ll be learning how to invest in stocks or launch startups.
Steel Tariffs Are Taxing Some American Companies; U.S. firms say some customers are opting to import finished goods rather than absorb price increases; ‘a nightmare for steel consumers’
Andrew Tangel and Ruth Simon – WSJ
New tariffs intended to bolster the American steel and aluminum industries are starting to have the opposite effect in a key part of the U.S. supply chain.
Bacon doubles commitment to new Coffey hedge fund; Macro fund with focus on emerging markets shows solid early returns
Lindsay Fortado in New York – FT
Hedge fund founder Louis Bacon will double his investment in the new fund set up by former colleague Greg Coffey after it showed a return of 4.6 per cent in the seven weeks since it began trading, according to people familiar with the investment.
S&P downgrades Deutsche Bank on restructuring plans; Rating agency says lender is set for ‘sustained underperformance’
Edward White, Katie Martin and Olaf Storbeck – FT
Deutsche Bank suffered a fresh blow on Friday after Standard & Poor’s downgraded its view of the lender, blaming a bigger and riskier than expected restructuring at the German group.
Deutsche Bank’s Slow Bleed Continues as a Pivotal Month Begins
Sridhar Natarajan , Yalman Onaran , and Sonali Basak – Bloomberg
Tumultuous week ends with company trading near a record low; Weeks ahead will feature Fed stress tests and major job cuts
Deutsche Bank AG just ended a roller-coaster week. June doesn’t look any less harrowing.
UniCredit Pushes for Merger With SocGen, FT Reports
Tim Loh – Bloomberg
Talks are reportedly in early stages and face big hurdles; Consolidation among Europe’s big banks has been a hot topic
Italian bank UniCredit SpA is considering a merger with France’s Societe Generale SA, a move that would combine two of Europe’s largest financial institutions, the Financial Times reported Sunday.
Financial services firm FinTrU eyes all-Ireland expansion
Peter Hamilton – Irish Times
Growing up as the son of a cattle dealer in west Cork in the 1970s and 1980s, Darragh McCarthy thought there had to be an easier way to make money. Drawn to financial markets, he started in Morgan Stanley in 1994 where he remained until late 2012.
Italian Treasury bought back bonds as prices slumped; Attempt to cut future refinancing costs may have eased liquidity drought
Kate Allen in London – FT
The Italian Treasury Department intervened in the market and bought back bonds earlier this week in an apparent effort to defuse volatile trading conditions.
Singapore breaks with region in adopting NDAs; Move shows contrasting Asia attitudes to intellectual property
Louise Lucas in Singapore – FT
Shenzhen may be Asia’s Silicon Valley, but when it comes to protecting company secrets it is Singapore that it taking a page from the US technology hub’s playbook.
China Banks’ Waning Demand Hints at More Bond Defaults Ahead
More corporate bond defaults are likely as pressure mounts; Banks are reducing loans for other firms’ bond purchases
China’s banks, scrambling to adjust to the government’s deleveraging campaign, are likely to add to pressures on the corporate bond market as they shed more of their massive note holdings and de-risk their balance sheets.
China Bondholders Set to Learn How Much a Promise Is Worth
Narae Kim and Lianting Tu – Bloomberg
CEFC, China Energy defaulted on bonds sold with keepwell deed; China leads global sales of dollar notes with this feature
China’s fast-growing dollar-bond market is facing a fresh test as investors that counted on a type of credit-protection pledge seldom seen elsewhere find out just what those promises actually mean.
Hong Kong Banks, Meet the 21st Century; Virtual lenders are coming to a fintech laggard. About time.
Andy Mukherjee – Bloomberg
Ironically, the city that should have been first to be swept up by China’s fintech revolution is still a picture of old-world conservatism. Not for long, though. Hong Kong, whose last big innovation in retail payments is as old as the former British colony’s 1997 handover to China, is on the cusp of big change.
Japan’s Institutional Investors Seek Reliable Returns in Hedge Funds; Hedge funds such as Two Sigma Investments in New York and French-based CFM are staffing up in Tokyo to court new business
Kosaku Narioka – WSJ
Some of Japan’s biggest investors are stepping up investments in hedge funds in their struggle against low rates and market turmoil triggered by political uncertainty.
Fears debt crisis could spread through emerging economies
Anna Isaac – Telegraph
A crisis that has hit some emerging markets risks spreading through the world economy, according to a global investment trade body.
CBA agrees largest civil settlement in Australian history; Shares rise as country’s biggest bank pays A$700m to settle money laundering scandal
Jamie Smyth in Sydney – FT
Commonwealth Bank of Australia has agreed to pay A$700m (US$532m) and admit liability to settle claims by Australia’s financial crime agency that it broke anti-money laundering and counter-terrorism laws.
Revealed: plans for Doomsday Brexit; Food, petrol and medicines would run out in a no-deal scenario
Tim Shipman, Political Editor – The Times
Britain would be hit with shortages of medicine, fuel and food within a fortnight if the UK tries to leave the European Union without a deal, according to a Doomsday Brexit scenario drawn up by senior civil servants for David Davis.
Brexit Britain Wants to Be a World Leader in Driverless Vehicles
Anna Hirtenstein – Bloomberg
Focus is on remote-control parking, AVs on highways in 2018; U.K. may have regulatory advantage after Brexit: Allen & Overy
Britain is stepping up its plans to be a leader in self-driving cars. The government is awarding 25 million pounds ($33 million) this week to as many as six projects that will research and test autonomous vehicles on highways and on trials of remote-control parking. It’s the second competition in a program that Richard Harrington, the U.K.’s automotive minister, predicts will lead to driverless cars in production within the next decade.
Britain hints at staying in European VAT area after Brexit; London taking ‘active role’ in shaping tax rules for 2020s despite leaving the EU
Chris Giles, Economics Editor – FT
Britain is taking what a minister has described as an “active role” in shaping new EU value added tax regulations for the 2020s, suggesting the Treasury is planning for the UK to remain inside the bloc’s VAT area after the Brexit transition period.
Wells Fargo eyes Paris and Dublin as post-Brexit hubs; Latest sign of financial fragmentation across EU after UK leaves bloc
Alistair Gray in London, David Keohane in Paris and Laura Noonan in Dublin – FT
Wells Fargo is eyeing a plan to use both Paris and Dublin as its post-Brexit hubs in Europe, becoming the latest global bank to prepare to shift some operations from London.
Call for tech start-ups to be supported to offset Brexit; British Business Bank should be used to soften impact of EU departure, IPPR says
Aliya Ram in London – FT
The UK government should encourage the publicly owned British Business Bank to invest in start-ups to offset the impact that Brexit will have on funding for the tech sector, according to a think-tank.
How psychological effects impact cognitive performance in competitive environments
London School of Economics and Political Science
Understanding cognition is important. Several studies establish that cognitive ability is a strong predictor of occupational attainment, wages, and a range of social behaviours in adults. It is also important for predicting the schooling performance of children, adolescents and university students. Further, numerous settings represent competitive situations that involve cognitive performance, ranging from test taking and student competition in schools to competitions for promotion in firms and organisations.
Why Studying The Classics Is Crucial To Understanding The Human Spirit And Western Civilization
Bre Payton – The Federalist
In the first lecture of Hillsdale College’s course on the histories of Athens and Sparta, which you can follow along with me here, college President Larry Arnn explains why studying the classics is necessary to understand Western civilization.
Controversial historian Niall Ferguson resigns from Stanford role amid leaked emails
Annie Vainshtein – SF Gate
Niall Ferguson, a controversial British historian who has been criticized for his support of British imperialism, announced he was resigning from his position with Cardinal Conversations, a speaker series at Stanford University, after leaked emails revealed he asked Republican students to conduct “opposition research” on a left-wing student activist.