Hits & Takes
By JLN Staff
Paul Tudor Jones told CNBC that this ‘crazy’ stock market run reminds him a lot of ‘early’ ’99~JJL
One of the political issues of the day is voter registration. People across the U.S. are being knocked off the voting rolls for various reasons. There is a website where you can check your registration status to make sure you are still registered, www.vote.org. If you are a U.S. voter, I encourage you to check it out.~JJL
Correction: ICE’s options on its January Bakkt bitcoin futures expired trading on January 13. 24 calls and 25 puts, described as phantom in yesterday’s newsletter, in fact expired out of the money on the 13th. There were no trades in bitcoin futures options as well as no open interest the next day, January 14. ICE does not publish reports for days without volume or open interest. I apologize for the errors in my comment yesterday.~Thom Thompson
We apologize for the errors yesterday. As to the correction, no wood, or person, was hurt behind the woodshed. OK, it is a virtual woodshed.~JJL
Coindesk is reporting that the open interest in bitcoin futures at the CME Group are up 100% since the start of 2020.~JJL
CME Group Achieves Record International Average Daily Volume of 4.8 Million Contracts in 2019, Up 10 Percent from 2018
CME Group, the world’s leading and most diverse derivatives marketplace, today announced that it achieved record international average daily volume (ADV) of 4.8 million contracts in 2019, up 10 percent from 2018. This record, reflecting all trading done outside North America, was driven largely by growth in Equity and Interest Rate products, up 17 percent and 15 percent respectively.
*****This is a truly impressive achievement.~JJL
How a herd of cows trampled on human stockpickers; Norwegian TV show highlighted just how hard it can be for investors to beat the market
Robin Wigglesworth – FT
Investing is hard. So hard, in fact, that even highly-trained professionals who have dedicated their lives to mastering markets often fail. An unusual experiment in Norway, pitting pros against livestock, underscored just how tricky it can be.
*****Evidently the bovine know a cash cow when they see one.~JJL
Companies face trouble from their older staff; Employers may want them gone but most workers would prefer to stay
Michael Skapinker – FT
Paul Ewart, a distinguished member of Oxford’s physics department, had no desire to leave when he reached the university’s then mandatory retirement age of 67 (it has since been raised to 68). He applied for a two-year extension, which he received. At the end of that he applied for a further extension and was refused. So he sued Oxford for age discrimination and won.
***** I value experience. I value age. I value youth. I value people.~JJL
Davos 2020: The American Dream is easier to achieve in Canada
Hanna Ziady – CNN
If you’re born in the United States, having wealthy parents matters a great deal to your chances of success, according to a new report. Individuals born into poorer families have a better chance of owning a home, getting a good education and experiencing a better life than their parents if they are born in Canada than if they are born in the United States. In other words, Canadians have a better shot at the American Dream than Americans do. That’s according to the World Economic Forum’s Global Social Mobility Index, which ranks 82 countries on their citizens’ ability to fulfill their potential regardless of their socio-economic background.
*****Achieve the American Dream and be incredibly polite. That is a dream come true.~JJL
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Monday’s Top Three
Our most read story Monday was the Financial Times’ The index providers are quietly building up enormous powers, about the MSCI’s 2018 decision to include some Chinese stocks in its benchmarks – in particular the MSCI Emerging Markets index. Second was The Wall Street Journal’s The Dog That Didn’t Bark: What Soybean Prices Say About Trade Deal about the effect (or lack thereof) of the recent U.S. – China trade deal on soybean prices. In third was Gary DeWaal’s Bridging the Week column, Spoofing; Compliance Officer Fined and Banned; Security or Virtual Currency?
171,188,908 pages viewed; 24,031 pages; 223,141 edits
|CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.Recently Updated Pages
1,334 pages; 11,779 edits
Hedge Funds Not Led by White Men Outperform Peers Nearly 2 to 1
Jeff Green – Bloomberg
Minority and female managers’ returns were 72% better; Bloomberg review shows pattern continues in times of crisis
Hedge funds not controlled by white men had returns almost double their peers the last three years, and the advantage continued even in times of crisis, according to a Bloomberg analysis of hedge fund data.
China Seeks to Stop Virus Scare From Becoming Political Crisis
Xi makes personal call for action as virus concerns deepen; Leadership faces test with echos of SARS outbreak 17 years ago
A deadly new virus reminiscent of one of China’s biggest public health debacles has the country’s leaders rushing to keep another outbreak from becoming a political crisis.
EU Financial Tax Faces New Trouble as Austria Threatens to Quit
Alexander Weber – Bloomberg
Latest proposal doesn’t achieve original goal, Bluemel says; Ministers have talked about a transaction tax since 2011
Austria’s new finance minister dismissed a proposal by his German counterpart on how to tax financial trades in the European Union, throwing the years-long effort into disarray.
Private Equity Is Eating the U.K. Stock Market; Since the Brexit referendum, the total value of companies quoted in London has been falling.
John Authers – Bloomberg
The Incredible Shrinking British Stock Market
A blog post by LearnBonds of the U.K. reveals something very interesting about the world economy and the state of capital markets. The politics of Brexit has inflicted all kinds of thrills and spills over the last four years. But the underlying trend is clear: The size of the British market is shrinking.
“No-Deal” Brexit Is Back as a Real Possibility; Sajid Javid’s comments on Britain diverging from EU rules make a skimpy trade deal more likely. In that case, would it be worth having one at all?
Therese Raphael – Bloomberg
The U.K.-European Union trade talks haven’t started officially, but both sides are testing out negotiating lines. Britain is already coloring some of them red, setting up a fight later this year that will encompass the three Fs: fish, financial services and the freedom to diverge from EU rules.
Why India is seeking to lure rupee trading onshore; Authorities have grown concerned over rising offshore volumes in the currency
Eva Szalay – FT
Indian authorities have launched a major push to bring rupee trading back home, alarmed by the rapid growth of an offshore market that limits their influence over exchange rates and can become disconnected from domestic trading.
Calpers and the ‘illiquidity premium’
Jamie Powell – FT
In 2019 we took a quick look at some comments by Calpers, the $401bn Californian pension megafund, regarding its private equity book. Chief investment officer Ben Meng was bullish on the asset class, telling the fund’s investment committee that Calpers needed more exposure to PE “and we need it now”.
Moral Money Davos special: Climate change threatens quant funds; Your guide to the investment and business revolution you can’t afford to ignore
Gillian Tett, Andrew Edgecliffe-Johnson, Billy Nauman and Patrick Temple-West – FT
Quant funds could be latest climate victims: UBS
This week in Davos, there will be chatter about the winners and losers from climate change. So here is another potential loser to ponder that has not received much attention (yet): the so-called “quant” funds.
On a mission to close Silicon Valley’s gender equity gap; High-flyer and investor April Underwood is determined to close the chasm in ownership
Jonathan Moules – FT
After 20 years at the heart of San Francisco’s tech scene, April Underwood is on a mission to challenge male domination of the start-up community in Silicon Valley and the Bay Area.
UBS misses targets after profit falls in 2019; Solid fourth quarter failed to recoup a steep fall in profits at investment bank
Sam Jones – FT
A solid fourth quarter performance at UBS failed to recoup a steep fall in profits at the group’s investment bank over the last twelve months, with ultra-low interest rates and choppy markets leading to the Swiss lender missing its targets for 2019.
India Now Has World’s Largest Derivatives Exchange by Volume
Abhishek Vishnoi and Ashutosh Joshi – Bloomberg
India’s National Stock Exchange has surpassed America’s CME Group Inc. to become the world’s largest derivatives bourse by volume.
Wall Street Wants to Conquer China. Here’s What May Go Wrong
China opens its $45 trillion financial market to foreign firms; Banks face tight competition and a fierce hunt for talent
China’s financial opening could be a classic case of be careful what you wish for. The opportunity of making inroads in the world’s second-largest economy is prompting the likes of Goldman Sachs Group Inc. and JPMorgan Chase & Co. to detail expansions that some estimate will see $1 trillion plowed into China. Plans to throw open the $45 trillion market were expedited last week after China said it will hasten the entry for securities firms, rating companies and credit-card providers as part of a trade deal with the U.S.
Exchanges, OTC and Clearing
SGX included in 2020 Bloomberg Gender-Equality Index
Recognised for its high level of gender-related disclosure and efforts to advance gender equality; 27% of SGX’s Board is represented by female directors, highest in the financial sector among the top 100 Singapore-listed companies
Singapore Exchange (SGX) has been included in the 2020 Bloomberg Gender-Equality Index (GEI), one of 325 companies across 50 industries in 42 countries and regions. SGX was added in this year’s index for scoring above a global threshold established by Bloomberg to reflect a high level of disclosure of gender-related metrics and overall performance across the GEI framework.
Clearstream and UBS agree long-term partnership in the fund sector
Clearstream acquires majority stake in Fondcenter AG, the fund distribution platform of UBS / UBS remains in the future joint venture / The combination of Fondcenter with Clearstreams Fund Desk creates a leading provider of fund services – with significant benefits for UBS and Clearstream clients
Euroclear to Roll Out Fixed Income Data Services; The post-trade firm and custodian will launch new data services for fixed income liquidity and APIs for its reference data offerings.
Josephine Gallagher – Waters Technology
Euroclear is planning to launch a data product that will provide liquidity analytics for fixed income. The Belgium-based clearing house will derive liquidity insights from millions of executed and settled trades that flow through its systems each year into its data lake, and deliver the analytics to clients via API. Although settlement typically occurs two days after a trade, Euroclear can begin collecting and gleaning the data throughout the post-trade lifecycle.
Citadel Securities joins BGC’s Fenics GO derivatives platform as liquidity provider; Citadel Securities joins market makers IMC, Maven Securities and Optiver, already committed to providing liquidity to Fenics GO.
Hayley McDowell – The Trade
Citadel Securities has expanded its listed derivatives market making capabilities by joining BGC Partners’ Fenics Global Options (Fenics GO) as a liquidity provider.
Red Deer and Cappitech combine MiFID II and MAR services for the buy-side; Compliance technology providers Red Deer and Cappitech will offer each other’s services to their respective clients for a more integrated solution.
Hayley McDowell – The Trade
Technology providers Red Deer and Cappitech have teamed up to combine their services to provide investment firms with a holistic regulatory compliance solution.
AI compliance tech start-up FeedStock raises £2.5 million in funding; Founded by a former fund manager and corporate broker, FeedStock provides AI and NLP technologies to help firms meet regulatory requirements.
Hayley McDowell – The Trade
An artificial intelligence-driven compliance technology company founded by a former fund manager and corporate broker has raised £2.5 million in a recent funding round.
IBM Proposes Artificial Intelligence Rules to Ease Bias Concerns
Ben Brody and Olivia Carville – Bloomberg
Computer giant urges industry, governments to draft standards; CEO Ginni Rometty to make proposals during Davos conference
IBM called for rules aimed at eliminating bias in artificial intelligence to ease concerns that the technology relies on data that bakes in past discriminatory practices and could harm women, minorities, the disabled, older Americans and others.
Proliferation of Fake Information: Deepfakes & the Capital Markets; As the spread of false information online threatens our view of the world, Josephine Gallagher examines how this phenomenon has evolved with technology.
Josephine Gallagher – Waters Technology
Can you trust what you read or see online? Notice the irony as you read this story from—more than likely—a web browser on your laptop or mobile device. The truth is that this question is very relevant in the world we live today.
Central Banks Team Up to Study Case for Digital Currencies
David Goodman – Bloomberg
Institutions across the world are teaming up to assess the case for central bank digital currencies. The group has been formed in order to “share experience as they assess the potential cases for central bank digital currency in their home jurisdictions,” according to a statement from the Bank of England on Tuesday. It will be made up of the Bank of Canada, BOE, the Bank of Japan, the European Central Bank, the Riksbank and the Swiss National Bank, along with the Bank for International Settlements.
New Bill In Congress Could Have Massive Impact On Bitcoin, Ethereum, And Other Cryptocurrencies
Kyle Torpey – Forbes
Last Thursday, the Virtual Currency Tax Fairness Act of 2020 was introduced in Congress. The bill has the potential to solve a major issue with payments made via Bitcoin, Ethereum, and other major cryptocurrency networks in that an exception would be created for the potential capital gains taxes that often occur when these digital assets are used in everyday commerce.
UK’s central bank to explore digital currency
Yogita Khatri – The Block
The Bank of England has officially announced that it will explore potential use cases for central bank digital currencies. The BoE has formed a group with five other central banks and the Bank for International Settlements. The group will “assess CBDC use cases; economic, functional and technical design choices, including cross-border interoperability.”
Australia could regulate Facebook-led Libra project
Yogita Khatri – The Block
The Australian Prudential Regulation Authority (APRA), one of the country’s top financial regulators, has said that it could “potentially” regulate the Facebook-led Libra stablecoin project. In an official submission to a Senate inquiry on fintech, published Monday, APRA said it has proposed a new regulatory framework that would allow it to oversee wallets that are “widely used as a means of payment,” for example, “potentially Facebook’s Calibra proposal.”
UK offers $130K for software that can trace Bitcoin, Ethereum, and (hopefully) Monero
David Canellis – TNW
The UK has opened a contract worth £100,000 ($130,000) to procure software to identify when cryptocurrency is used to avoid paying taxes. In particular, HMRC is seeking the ability to cluster cryptocurrency transactions, identifying those linked to service providers such as mixing, gambling, and dark market services.
On Crypto Lending & The Downside of Defi: BlockFi CEO Speaks
Rachel McIntosh – Finance Magnates
The last several years in the cryptocurrency industry have certainly seen a lot of ups and downs – the massive swell at the end of 2017, the doldrums of 2018, and the recovery of 2019.
However, despite the volatility in most of the cryptocurrency industry, a few corners of the industry have managed to continuously grow. One of these is the crypto lending sector. In early 2019 – after one of the crypto markets’ lowest points in months – NY-based crypto lending company BlockFi reported that both its revenues and customer base had increased to the tune of 100 percent since June of 2018, when Galaxy Digital Founder Mike Novogratz invested $52.5 million in the company.
Bitcoin’s ‘Twitter sentiment’ data gets rolled out by a blockchain data firm
Yogita Khatri – The Block
New Zealand-based blockchain data and research firm Brave New Coin (BNC) has launched a new metric for bitcoin. Dubbed “Twitter Sentiment,” the metric analyzes over 34 million bitcoin-related tweets every week, BNC announced Monday. The firm uses Artificial Intelligence (AI) algorithms that search for tweets containing words such as bitcoin, $BTC and BTC, among others.
Do Custodians Wield Undue Influence on Crypto Market Prices?
Noelle Acheson – Coindesk
Let’s talk about containers – not the massive cargo ships that cross oceans, but vessels such as bottles, boxes and bins. Things that hold stuff. A reliable container does just that, it holds. It doesn’t transform its contents. In finance, the vessel is the custody service that stores a fund’s assets. A good custody service reliably “holds” securities and bonds in its client’s name, often providing additional services but never influencing the value of the asset. Cryptocurrency markets are different. Good crypto custody services can have a material impact on an asset’s market price, even going as far as affecting its fundamental value.
Monerium to issue e-money on Alogrand’s proof-of-stake blockchain protocol
Yilun Cheng – The Block
Blockchain startup Algorand is linking up with e-money services company Monerium, the two companies announced Monday. Monerium – which obtained an e-license money from regulators in Iceland last summer – will support Algorand’s proof-of-stake blockchain through its e-money initiatives. Monerium’s e-money projects are focused on EU member states, Iceland, Norway and Liechtenstein with digital cash denominated in U.S. dollars, euros, British pounds and the Icelandic krona, according to a press statement.
UK’s tax authority wants to deploy a blockchain analytics tool to catch crypto cybercriminals
Yogita Khatri – The Block
HM Revenue and Customs (HMRC), the U.K.’s tax authority, is looking to deploy a blockchain analytics tool that could help it identify cybercriminals trading in cryptocurrencies. The tax agency wants to analyze cryptocurrency transactions, such as for bitcoin and ether, which are being used for “tax evasion and money-laundering,” news outlet PublicTechnology reported Monday, citing HMRC’s request for proposal document.
Fidelity is hiring bitcoin mining engineer to scale its operations
Yogita Khatri – The Block
Asset management giant Fidelity, with over $7 trillion in client assets, is seeking a bitcoin mining engineer to scale its operations. According to a job posting on its website, Fidelity is hiring for the role to help design, build, and maintain the infrastructure to run and scale its bitcoin mining operations.
Canadian Teen Charged for $50 Million Cryptocurrency Theft
Andrey Shevchenko – Cointelegraph
An eighteen-year-old from Montreal is facing four criminal charges connected to a $50 million SIM-swapping scam targeting cryptocurrency holders, Infosecurity Magazine reported on Jan. 17. The hacker, Samy Bensaci, is accused by Canadian authorities of being part of a ring that stole millions of dollars in cryptocurrency from American and Canadian holders. The theft is said to have occurred in spring of 2018, with Québec police representative Hugo Fournier saying that the hackers were responsible for the theft of “$50 million from our neighbors to the south and $300,000 in Canada.”
Crain’s Daily Gist podcast: What’s in store for cryptocurrency; As CME Group launches bitcoin options, why should business leaders take it seriously? Plus: The state Senate has a new leader, Rosebud plans a restaurant near Millennium Park, and workers expect businesses to act on social and environmental issues.
Crain’s Chicago Business
On the heels of CME Groups’ recent launch of bitcoin options, Bloq Chairman Matthew Roszak joins the podcast today to talk with host Amy Guth about the future of cryptocurrency and blockchain technology for businesses, how other countries are adapting to digital assets and why business leaders should take it seriously.
Investor concerns over US election surpass trade war fears; Key survey shows election outcome now top ‘tail risk’ cited by fund managers
Adam Samson – FT
Investors have grown more concerned over the potential “tail risks” posed by this year’s US presidential election than the global trade war, underscoring the importance of America’s public policy with global markets sitting at record peaks.
Tech groups dominate Davos but focus shifts from giants to unicorns; Antitrust, privacy issues and ‘technology for good’ feature on World Economic Forum agenda
Rana Foroohar – FT
The technology sector is set to maintain its dominance at the World Economic Forum this year. But while the Big Tech consumer giants have been the main focus in the past, this may be the year of the unicorn.
Trump Legacy at Risk as Senate Impeachment Trial Opens Today
Justin Sink – Bloomberg
Trial could shape U.S. public opinion as elections approach; McConnell’s proposed trial rules may lead to quick acquittal
President Donald Trump’s impeachment trial formally opens in the Senate on Tuesday, promising to shape his legacy, deepen the country’s political divisions and influence control of power in the nation’s capital for years to come.
Macron, Trump May Have Tariff Truce in 2020 Digital Tax Spat
Ania Nussbaum and William Horobin – Bloomberg
‘Great discussion’ with Trump on digital taxes, Macron tweets; U.S. says leaders agreed completing tax negotiations important
Presidents Emmanuel Macron and Donald Trump agreed to a truce in their dispute over digital taxes that will mean neither France nor the U.S. will impose punitive tariffs this year.
France’s Macron Pauses Tech Tax After U.S. Pressure; France suspends levy and U.S. holds off on tariffs while both sides seek international tax agreement
Bojan Pancevski and Sam Schechner – WSJ
France and the U.S. have struck a truce on the divisive issue of taxing digital giants like Google parent Alphabet Inc., averting a trade war on the matter—at least for now.
The Davos Bubble Swallows Anyone Who Tries to Pop It; The Swiss junket is co-opting the populists, greenwashing the globalists, and doing whatever it takes to defend its brand.
Lionel Laurent – Bloomberg
“Davos is not one thing. There are many Davoses at Davos.” This haiku-like meditation on the annual Swiss junket — which is known for preaching the gospel of touchy-feely stakeholder capitalism against a backdrop of $43 hot dogs, $10,000 hotel rooms, and several hundred trips by private plane — could have come from any number of its rich, powerful and blissfully un-self-aware attendees.
Beijing and Taipei headed for collision over democracy; Shift in diplomatic language shows Beijing refuses to acknowledge Taiwan’s democratic DNA
Kathrin Hille – FT
Taiwan’s identity as an independent democracy crystallised with the landslide re-election of President Tsai Ing-wen on a platform to defend the country’s institutions against China.
Germany to force closures of hard coal power plants by 2027 – draft
Germany will force the closure of power plants fired by hard coal starting in 2027 if utilities do not take up compensation tenders, a draft law seen by Reuters showed on Tuesday.
Ex-Barclays Banker Boath Won’t Testify in Qatar Fraud Trial
Ellen Milligan and Franz Wild – Bloomberg
Former Barclays Plc executive Richard Boath won’t testify in his U.K. trial, where he’s accused with two colleagues of hiding payments to Qatar linked to a bailout during the 2008 financial crisis.
FCA statement on Assessing Suitability Review 2
In our business plan, we outlined our intention to review the market for pensions and investment advice for a second time – the Assessing Suitability Review 2.
Warning on being careful where you get your data from; We have become aware that the Raid Forum website is offering what purports to be FCA information for sale.
We believe that this information has been improperly obtained from third parties. Based on our detailed assessment, we believe that there has been no compromise of our systems or of data held by the FCA.
CFTC urged to cement relief from a non-cleared margin rule; Isda seeks permanent right for firms to specify two separate minimum transfer amounts as initial margin rules approach full implementation
Noah Zuss – Risk.net
The derivatives industry is calling on US regulators to permanently allow a common application of a rule on margin for uncleared swaps, a change that would be welcomed by large funds and banks.
City regulator’s new broom has a full to-do list as Bailey goes to the Bank
Adam Williams – Telegraph
Andrew Bailey’s controversial tenure as head of the City watchdog will come to an end within weeks, but he leaves behind an inbox groaning with problems for his successor to deal with.
Investing and Trading
Tyson Scion to Lead Sustainability Push; Meat company aims to form world-wide coalition to address resource conservation, food waste
Jacob Bunge – WSJ
A member of Tyson Foods Inc.’s TSN -0.18% founding family is calling on the meat industry to address issues like resource conservation and food waste.
Glencore weighs 665 job losses at South African smelter; Rustenburg facility under pressure from rising electricity tariffs and power cuts
Harry Dempsey – FT
Glencore and its joint venture partner Merafe Resources could cut up to 665 jobs at their Rustenburg ferrochrome smelter as it battles rising electricity tariffs and power cuts.
Green loans catch on in push for companies to clean up; Unlike green bonds, money from sustainability-linked loans can be used for any purpose
Billy Nauman – FT
Green finance is growing rapidly, with an increasing number of lenders scrambling to offer better loan terms to borrowers that can show they are lessening their environmental impact.
US gas exporters fight to survive supply glut; Prices fall around the world and planned capacity exceeds what will be needed
Gregory Meyer – FT
Multibillion dollar gas export projects that are central to the Trump administration’s push for “energy dominance” are locked in a battle for survival as prices fall and the market faces a supply glut.
Goldman Says Palladium May Surge to Test $3,000, Then Slide
Stephen Engle and Ranjeetha Pakiam – Bloomberg
Precious metal has jumped 26% this year amid worldwide deficit; Commodity veteran Currie forecasts price to ‘fall back again’
Palladium’s extraordinary rally has the potential for prices to go on and test $3,000 an ounce, according to Goldman Sachs Group Inc.’s Jeffrey Currie, who twinned that outlook with a clear warning that such peaks wouldn’t last for long as the record levels would cut into demand.
A Winemaker’s 50-Year Bet on Surviving Climate Change; It starts right now, with sheep in Patagonia.
Laura Millan Lombrana – Bloomberg
Sunrise comes early high up on the Patagonian steppe, bathing the cloud-covered shrublands and plateaus in a stunning hue of golden yellow. It is only later, when the fog releases its grip on the land, that Los Condores, a sprawling ranch just on the Chilean side of the border with Argentina, comes into full view.
The Investor Clash Behind Tesla’s Surge Toward $100 Billion in Market Value; Warring camps step up disagreement over what the shares are worth
Gunjan Banerji and Julia-Ambra Verlaine – WSJ
When Tesla Inc. TSLA -0.58% stock tumbled to a three-year low of around $178 a share last June, Brian White pounced. The online producer sold holdings in tech stalwarts like Microsoft Corp. and says he put about three-quarters of his retirement account into the electric-car maker’s stock.
Somebody Big Has Called This Year’s Oil Market Completely Wrong; OPEC sees output cuts draining inventories, others disagree
Julian Lee – Bloomberg
The world’s three biggest oil-market forecasters are split on what’s going to happen with supply and demand this year — and at least one of them is going to be proved flat wrong.
The Limits of Environmental Activism From BlackRock’s Larry Fink; The world’s largest active manager has taken a meaningful step, but corporate finance is relatively powerless to curb carbon emission as coal assets move into state hands
Nathaniel Taplin – WSJ
Saving the planet needs coordination from Washington and Beijing, not New York and Hong Kong. Larry Fink, chief executive of BlackRock, made waves last week with his pledge to push environmental concerns up the corporate agenda. The world’s largest asset manager will drop major power-coal producers from its actively managed funds by mid-2020, among other plans.
Top hedge funds post biggest gains in at least a decade; Performance is led by equities managers in annual survey of dollars returned to investors
Laurence Fletcher – FT
The top 20 best-performing hedge fund managers of all time made $59.3bn for their investors last year, their biggest annual gains in at least a decade, as hedge funds took advantage of a strong tailwind in stock and bond markets.
UBS Misses Key Targets in Challenge to Iqbal Khan Overhaul
Marion Halftermeyer and Patrick Winters – Bloomberg
Swiss bank cuts financial goals, sees outflow of wealth assets; UBS joins Credit Suisse, Deutsche Bank in paring expectations
UBS Group AG missed key targets for 2019 as investors pulled money late in the year, underscoring the challenge for new wealth management co-head Iqbal Khan as he seeks to turn around its most important business.
Lloyds Banking Group to halve carbon emissions of investments by 2030; Lloyd’s Banking Group has pledged to halve the carbon emissions generated by projects it finances by 2030, in support of the UK’s 2050 net-zero target.
Set against a 2019 baseline, the new ambition aims to help businesses served by Lloyds to invest in green projects and technologies. Under the target, Lloyds will launch new “green” finance products for businesses and individuals in 2020. Details of all of the products are yet to be announced, but Lloyds claims they will help businesses to improve building energy efficiency and increase their investment in low-carbon technologies. Mortgages and loans could be on the cards.
BMO launching new suite of ESG ETFS, and some big-name companies didn’t make the cut; Royal Bank of Canada, BCE Inc., Manulife Financial Corp. and Air Canada failed to make it into the BMO MSCI Canada ESG Leaders Index ETF
Victor Ferreira – Financial Post
BMO is launching a new suite of ETFs that are focused on giving investors exposure to the companies that are best incorporating ESG principles into their businesses — and they’re willing to exclude some of the best-known stocks in Canada and the U.S. to do so.
Africa’s Richest Woman Is Barred From Her Bank and Under Investigation
Michael Forsythe – WSJ
Isabel dos Santos, Africa’s richest woman and the daughter of Angola’s former president, is under scrutiny by her bank and the Angolan government after a leak of more than 700,000 documents showed how she exploited the country’s wealth to enrich herself.
Vulture Investors Swoop Into China to Feast on Soured Loans; Global money managers including Bain Capital, Lone Star and Oaktree are piling in; largely a real-estate play
Near a murky river in this eastern Chinese city, a freshly renovated apartment building touts dozens of furnished rooms in move-in condition.
Sanjeev Gupta attempts to increase transparency of family empire; Consolidation of aluminium businesses follows questions over opaque financing
Nikou Asgari – FT
Sanjeev Gupta is consolidating his aluminium businesses into one group in a fresh bid by the British businessman to increase transparency across his industrial conglomerate.
Lekoil fake loan probe puts spotlight on Bahamas broker; Scam by people pretending to be from the QIA leaves oil explorer’s future in balance
Harry Dempsey, Neil Hume and Archie Hall – FT
Inside a glass-and-marble office close to London’s Victoria station sits the headquarters of a small west African oil producer embroiled in one of the most bizarre scandals to hit the lightly regulated Aim market in more than a decade.
‘Massive Amounts of Money’ Headed for Nordic Real Estate
Frances Schwartzkopff and Hanna Hoikkala – Bloomberg
The Nordic real estate market attracted more investor cash than ever before last year, and it’s now getting even hotter. Linus Ericsson, chief executive of the Swedish unit of Fortune 500 real estate adviser Jones Lang LaSalle Inc., says much of the demand comes from outside the region, where buyers are looking for scale.
Cadwalader Expands Transatlantic White Collar Practice with Addition of Leading City Partners Mark Beardsworth and Kevin Roberts; Arrival of New Partners Reinforces Cadwalader’s Aggressive Growth Strategy in London
Cadwalader, Wickersham & Taft LLP has expanded its transatlantic white collar defense and investigations practice with the addition of two market-leading London partners, Mark Beardsworth and Kevin Roberts. The new partners bolster the firm’s global litigation group, adding depth to its London disputes group and providing a specific focus on UK- and EU-based regulatory and criminal investigations and defense, as well as compliance matters, particularly in cross-border cases.
China Virus Outbreak Thwarts Most Bullish Stock Market in Years
Travel, liquor stocks lead losses before Lunar New Year break; Leverage had risen to the highest level in nearly two years
A virus outbreak in China is sending shockwaves through the country’s stock market, denting what had been growing enthusiasm toward shares.
City of London Braces for a Post-Brexit Squeeze; U.K.’s financial sector worries trade negotiations with EU might curtail access to bloc
Anna Isaac and Max Colchester – WSJ
Britain’s hulking financial sector presents a serious dilemma for both sides in the U.K.’s coming trade negotiations with the European Union. Whatever the outcome, British-based financial institutions are preparing to see their access to the trade bloc heavily curtailed after Brexit.
Battle lines drawn on post-Brexit trade talks; UK chancellor insists ‘there will not be alignment’ with EU regulation
Jim Brunsden and George Parker – FT
Sajid Javid, UK chancellor of the exchequer, has laid down one of the battle lines of the post-Brexit trade talks with Brussels, warning that Britain will never be a supplicant that accepts EU rules.
EU Wants Fines to Enforce Post-Brexit Deal With U.K.
Jonathan Stearns – Bloomberg
Bloc discusses planned pact on future relations with Britain; Brussels preparations heat up for negotiations after Jan. 31
The European Union wants any agreement with the U.K. on post-Brexit relations to include possible fines for violations of the pact, a new document shows.
U.K. to Ensure No Brexit Cliff-Edge for Carmakers, Minister Says
Alex Morales – Bloomberg
Compatible standards will keep supply chains running: Zahawi; Chancellor Javid says U.K. seeks a ‘deep’ trade deal with EU
U.K. carmakers including Nissan and Jaguar Land Rover won’t face a regulatory cliff-edge that damages their competitiveness in European markets at the end of 2020, according to Prime Minister Boris Johnson’s government.
Majority of those in global survey view capitalism as doing ‘more harm than good’
Nicolas Vega – NY Post
A majority of people around the world believe that capitalism is a negative force, according to a new study. Researchers contacted 34,000 individuals in 28 countries, including the US, France, China and Russia, and asked them if they were having doubts about Western-style capitalist-based democracies.