FIA Expo: U.S. Treasuries’ 2020 March Madness
Thom Thompson – John Lothian News
Wednesday morning Kevin McPartland, head of research at Greenwich Associates, and his U.S. Treasury Market: Key Takeaways From March 2020 panelists dug into what happened in the market during that remarkable month.
The Managed Funds Association’s Ben Allensworth said that his members faced various pressures especially from the transitory dislocations between cash and futures and on-the-run and off-the-run cash Treasuries. Some got out of positions and some stayed in, as one would expect given the variety of strategies deployed by hedge funds.
To read the rest, go here.
FIA Expo: Eurex CEO Michael Peters Weighs In On ESG, EU Equivalence
Suzanne Cosgrove – John Lothian News
Making his debut performance at an FIA conference Wednesday, Eurex CEO Michael Peters argued in favor of the drive toward environmental, social and corporate governance (ESG) products and weighed the pros and cons of the European Commission’s equivalence decision for UK CCPs.
To read the rest of this story, go here.
FIA Expo: 2020 Was a Very Good Year – for ICE
Sarah Rudolph – John Lothian News
Far from being felled by the COVID pandemic – or anything else that has happened in 2020 – the Intercontinental Exchange had its best year in history in revenue and earnings and made its largest acquisition deal ever – which is saying a lot – by buying Ellie Mae two months ago.
To read the rest of this story go here.
FIA Expo: Innovation on the Edges
Matt Raebel – John Lothian News
Jim Kharouf, communications director of IncubEx Inc., began “Innovation on the Edges” on Day 2 of FIA-V by saying “Happy Birthday” to the exchanges of each panelist present on the call. The Hong Kong Exchange (HKEX) is celebrating its twentieth year as a publicly-traded company; the Singapore Exchange (SGX) is twenty-one this year; and the Brazilian exchange Brasil Bolsa Balcao, or B3, is three years old. “But of course,” Kharouf said, “legacies for each go back way further.”
To read the rest of this report, go here.
FIA Expo: Good Fragmentation vs. Bad Fragmentation
Thom Thompson – John Lothian News
Deborah North, partner at the law firm Allen & Overy, moderated the Wednesday morning panel titled “Is Market Fragmentation the Future?” at FIA Expo 2020. She was joined by Trabue Bland from ICE Futures U.S., Robert Booij from ABN AMRO, Erik Mueller from Eurex Clearing, and Nathaniel Lalone from Katten Muchin.
To read the rest, go here.
FIA Expo: ESG Derivatives Evolve, But Growing Pains Remain
Suzanne Cosgrove – John Lothian News
Industry buzz about exchange-traded environmental, social and corporate governance (ESG) products has grown, but getting traction on ESG derivatives can be challenging, a panel of industry specialists said.
To read the rest, go here.
FIA Expo 2020: Overview of Innovator Pitches
Matt Raebel – John Lothian News
The Innovator’s Pavillion is one of the most intriguing parts of FIA – a small, curated collection of starry-eyed startups aspiring to make their mark. On the first day of FIA’s virtual Expo-V conference, each of nine companies had the opportunity to give pre-recorded “demo day” style presentations to FIA Expo attendees before their “virtual booths” opened on Day 2. These presentations included Q&A rounds from judges.
To read the rest, go here.
Hits & Takes
By John Lothian
Luke Jeffs of FOW has a story about advanced talks, confirmed by four people with knowledge of the deal, between Goldman Sachs and Trading Technologies for Goldman to acquire TT. This follows up on Barron’s story of a week ago and confirms that talks are taking place, though no deal has been struck yet.
The folks at the CrossTower exchange are celebrating record trading volumes in October as they reached $150 MM total volume in only five months after the platform’s launch.
The U.S. set yet another daily record of coronavirus cases with 145K yesterday. Whatever happened to “flatten the curve?”
The Wall Street Journal reports that “the number of hospitalized Covid-19 patients reached 65,368, according to the Covid Tracking Project, passing the record set Tuesday for the highest number of hospitalizations since April.”
Benzinga followed up on The Dallas Morning News story about Nasdaq and other exchanges exploring a move to Texas with a meeting set for November 20 with Texas Governor Greg Abbott.
Here are the list of finalists for the Benzinga 2020 Global Fintech Awards. Apex Clearing is a finalist in two categories.
This is the ultimate way to end it all or at least 2020. A new Japanese theme park attraction lets guests zipline into Godzilla’s mouth. Check it out.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
‘To Save Capitalism, We Must Help the Young’; Some surprising ideas from Deutsche Bank, a pillar of the German financial establishment.
Peter Coy – Bloomberg
Deutsche Bank AG may be the biggest bank in Germany, but that hasn’t kept its research arm from sounding a bit like Representative Alexandria Ocasio-Cortez, the lefty New York Democratic congresswoman, in the new issue of the bank’s magazine Konzept. The issue made headlines on Bloomberg and elsewhere for proposing a 5% tax on people who work from home, with the proceeds going to help low earners who aren’t able to work from home.
*****I can see it now, “Young Lives Matter!”~JJL
FTSE – The Inside Story By Mark Makepeace, Founder And Former CEO, FTSE Russell Group – Herbie Skeete
I have known Mark Makepeace for over 35 years. I was at Reuters and Mark was at the London Stock Exchange (LSE). The bit of Reuters that I was in – the market data bit – is now known as Refinitiv and it is ironic that Refinitiv is about to be acquired by the London Stock Exchange Group. Ironic, because back in the day Reuters and the LSE were deadly rivals. The LSE had a domestic equities information service, TOPIC, which was in competition with Reuter products. It took many years for Reuters to get close to TOPIC’s market share and Mark’s help in getting us to understand what the market wanted especially in information of the FTSE 100 constituents was a key part of our success. I must point out that the help Mark gave us was what he would give to any vendor carrying LSE data.
*****I love a good business book.~JJL
Nasdaq, Other Exchanges To Meet Texas Governor Next Week To Explore Relocation Out Of New Jersey
Shivdeep Dhaliwal – Benzinga
Representatives of Nasdaq Inc (NASDAQ: NDAQ) and other major exchanges will meet with the Texas Governor Greg Abbott on Nov. 20 in Austin as they consider relocation of their trading platforms from New Jersey to Dallas, NBC 5 Dallas-Fort Worth reported Tuesday.
*****Smart reporting by Benzinga to follow up on a story stuck behind a paywall.~JJL
New daily coronavirus cases in U.S. rise to 145,000, latest all-time high; Why experts say nationwide mask use is currently the ‘best strategy’ to combat coronavirus
Meryl Kornfield – Washington Post
In one week, new daily coronavirus cases in the United States went from 104,000 to more than 145,000 on Wednesday, the latest all-time high. Almost every metric is trending in the wrong direction as states add restrictions and health officials warn of a dangerous fall ahead.
****Wear a mask. Please.~JJL
Wednesday’s Top Three
Our top story Wednesday was John Lothian News’ FIA Expo: CME Group’s Duffy is Sailing Smoothly in Uncharted Waters. Second was another John Lothian News FIA Expo story, FIA Expo: Tarbert Misses Opportunities in Keynote Address. Third was Yahoo News’ Loeffler, Perdue call on Georgia’s Republican secretary of state to resign.
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How a Covid-19 Vaccine Could End Up Helping the Virus Spread; It may be possible to infect others even after getting a shot.
Peter Coy – Bloombereg
A vaccine that protects against symptoms of Covid-19 could contribute to the spread of the disease if—and this is still just an if—the people who get vaccinated remain capable of carrying and transmitting the virus. That’s a risk that’s gotten little attention amid the deserved jubilation over a Nov. 9 report from Pfizer Inc. and BioNTech SE that their vaccine candidate appears to be highly effective.
Goldman Sachs in talks to buy Trading Technologies – sources
Luke Jeffs – FOW
Goldman Sachs is in advanced talks with Trading Technologies International about acquiring the Chicago-based fintech firm for an estimated $500m (£370m), according to sources.
The US investment bank is said by four sources to be in late stage talks with TT about buying the trading and data analytics software firm but no agreement has been reached at this stage.
A spokeswoman for Trading Technologies said on Wednesday: “The TT platform is an industry-leading technology that unsurprisingly has captured the attention of a variety of industry players. Conversations with other firms about partnerships are nothing new, as we have always looked for ways to unlock additional value and share our vision for scaling the business.”
Britain to Brussels: Make your mind up over financial market access
Huw Jones – Reuters
Britain won’t consider offering further financial market access to EU firms from January until the bloc clarifies its own approach, a senior finance ministry official said on Thursday.
Most Wall Street workers to get lower 2020 bonuses: study
Year-end bonuses for most Wall Street workers are expected to decline this year compared with 2019 due to the impact of the COVID-19 impact on the U.S. economy, compensation firm Johnson Associates Inc said on Thursday.
U.S. prepares for worst four months of the pandemic as it stares down the ‘darkest’ days yet
Will Feuer – CNBC
Ohio has had an “unprecedented spike” in Covid-19 hospital admissions. ICU beds in Tulsa, Oklahoma, are full. North Dakota’s hospitals don’t have enough doctors and nurses. And hospital administrators in Iowa are warning that they are approaching their limits.
UK ‘sleep-walking’ into personal debt crisis, warns charity
Iain Withers – Reuters
Britain is ‘sleep-walking’ into a personal debt crisis with the number of people in severe problem debt topping a million due to the coronavirus pandemic, charity StepChange has warned.
Billionaire Louis-Dreyfus Finds a Costly Escape From Debt Drama
Andy Hoffman, Javier Blas, and Jack Farchy – Bloomberg
Louis-Dreyfus amassed $1 billion in debt to win trading house; She is selling 45% stake to ADQ to keep control of empire
Margarita Louis-Dreyfus suddenly became a key shareholder in one of the biggest commodity traders in 2009. She then spent most of the next decade locked in battles with her late husband’s family, fights that left her in sole control of Louis Dreyfus Co. but desperate for cash to repay the debt she accrued along the way.
‘The great 2020 money grab’: Muddy Waters unloads on Spacs; Short seller says it is betting against MultiPlan, which went public via a blank-cheque company
Ortenca Aliaj – FT
Muddy Waters, the US short seller run by Carson Block, has launched a scathing attack on 2020’s hottest investment phenomenon, the special purpose acquisition company, and revealed it is betting against a company brought to market by former Citigroup dealmaker Michael Klein.
Scandals rock South Korea’s booming hedge fund industry; Billions of dollars in losses undermine Seoul’s attempts to promote country as finance hub
Song Jung-a – FT
A sprawling probe into South Korean hedge funds whose investments lost billions of dollars has evolved into a political scandal that risks undermining efforts to position the Asian country as a financial hub.
New York’s hotel crisis puts pressure on $4bn mortgage bond sector; Industry body says potential Covid vaccine will provide no immediate relief to ‘comatose’ industry
Joe Rennison – FT
New York’s hotel industry is in crisis, with four out of five properties underpinning commercial mortgage bonds now showing strain under the weight of coronavirus and investors worrying whether hoteliers will be able to make good on their loans.
Former Kodak executives given millions in stock for options they did not own; Company blames internal ‘deficiencies’ for award and takes $5.1m expense
Andrew Edgecliffe-Johnson and Eric Platt – FT
Eastman Kodak handed five former executives stock worth millions of dollars this July in exchange for options they did not own, raising questions about the company’s controls just months after a proposed $765m loan from the Trump administration put it in the limelight.
SOFR trading tails off after ‘big bang’ boost; Volumes peak, then slow down on CCPs’ shift to new RFR, but remain above 2020 averages
Ben St. Clair – Risk.net
Swaps trading in the secured overnight financing rate (SOFR) hit new highs, then fell away in the two weeks after the so-called ‘big bang’ shift, when it became the discount rate of choice for cleared US dollar derivatives. These modest trading volumes have nonetheless remained above the lifetime average of the SOFR swaps market, which saw its first recorded trade in July 2018.
Global Food Supplies Weather Coronavirus Pandemic; Developing countries have stepped up to fill gaps created by disruptions, says United Nations Food and Agriculture Organization
Lucy Craymer – WSJ
Food supplies have held up during the coronavirus pandemic, defying warnings from economists that rising protectionist policies and disruptions at ports and to truck routes would lead to global shortages.
SoftBank racks up $3.7bn in losses at tech stock trading unit; First details emerge about ‘SB Northstar’, the division that bet billions on Nasdaq
Kana Inagaki in Tokyo and Robert Smith – FT
SoftBank has lifted the lid for the first time on “SB Northstar”, the new unit set up to play the market in tech stocks, and revealed that it has racked up trading losses of $3.7bn so far.
Masayoshi Son Again Pulled SoftBank From the Brink. This Time He Had Help; The world’s most unpredictable technology investor was coached out of the crisis by hedge fund Elliott Management, a major shareholder
Phred Dvorak, Corrie Driebusch and Juliet Chung – WSJ
Japanese tech billionaire Masayoshi Son late this spring said he had “peered over the cliff edge” of financial ruin. Now, the SoftBank Group Corp. 9984 1.49% founder and chief executive is sitting on one of the largest cash piles in the investing world.
Covid Hot Spots Show Signs Europe’s New Wave May Be Cresting
Thomas Mulier and Chris Reiter – Bloomberg
Covid’s latest wave continues to swell, with infections far surpassing official levels last winter and spring. Look beneath the surface, though, and there are glimmers of hope in some of the worst-hit European countries. With France, Spain, the U.K. and Italy — alongside Russia — all recording more than 1 million cases, the headlines remain grim. As the U.S. surpasses 10 million infections, Europe has been another epicenter of the pandemic’s autumn surge.
Merkel Warns Germany’s Curbs May Get Extended Through Christmas
Arne Delfs and Raymond Colitt – Bloomberg
No promise to lift lockdown with disease spreading too fast; ‘We all need to be completely reasonable now,’ chancellor says
Chancellor Angela Merkel opened the door to extending coronavirus restrictions into December as Germany struggles to regain control of the pandemic. While rapid increases in new cases have slowed, levels are still too high, Merkel said on Thursday. Germany is looking to reduce cases to 50 per 100,000 people over seven days from 138 currently.
Turkey Bans Public Smoking to Enforce Wearing Masks
Patrick Sykes – Bloomberg
Turkey announced a nationwide ban on smoking in some public places, warning that its fight against the coronavirus is being jeopardized by smokers removing their masks to light up. Mask-wearing is already compulsory outside the home in Turkey, but the Interior Ministry said it had observed people breaking this rule to smoke.
Japan Has Worst Day of Covid Cases Yet Amid Fears of Winter Wave
Lisa Du – Bloomberg
Hokkaido, Kanagawa among regions with record infections; Officials hint action may be needed to stem increase of cases
Japan hit a new daily record of coronavirus infections Thursday as authorities began hinting they may take stronger measures to arrest the increase. At least 1,634 cases were recorded nationwide, according to a tally by national broadcaster NHK, topping the previous high set during a surge in August. While numbers are low in absolute terms compared to many other countries, a spike in northern Japan is leading to concerns cases could spread as winter sets in.
Pfizer Success Shows China Must Unveil Data to Win Vaccine Race
None of China’s vaccine frontrunners have released key data; Difficult for China’s adversaries to trust its vaccine trials
Western politicians have faulted China for initial delays in providing information as the coronavirus spread around the world. Now as Beijing develops a vaccine, the need for transparency is proving essential to win back trust.
Hungary to become first EU state to trial Russian Covid vaccine; Procurement comes as global race for a vaccine heats up and is latest sign of Budapest’s cosiness with Moscow
Valerie Hopkins and Henry Foy – FT
Hungary has said it will receive a sample of the Russian-made Covid-19 vaccine within a week and a half, making it the first EU member state to announce plans to procure the Kremlin-backed jab.
New York limits social gatherings as virus surges across the US; New restrictions come as Anthony Fauci and other officials urge caution for Thanksgiving holiday
Matthew Rocco – FT
New York has moved to tighten restrictions on social gatherings as a surge in Covid-19 throughout the US has led to a record number of hospitalisations and stoked fears about a resurgent wave of infections heading into the Thanksgiving holiday.
Limiting Indoor Capacity Can Reduce Coronavirus Infections, Study Shows; Research using cellphone data in 10 U.S. cities last spring could help influence officials’ decisions on new restrictions as cases resurge around the country.
Benedict Carey – NY Times
Restaurants, gyms, cafes and other crowded indoor venues accounted for some 8 in 10 new infections in the early months of the U.S. coronavirus epidemic, according to a new analysis that could help officials around the world now considering curfews, partial lockdowns and other measures in response to renewed outbreaks.
Exchanges, OTC and Clearing
Evergrande Wins HKEX Approval for Unit’s IPO, a New Route for It to Raise Cash
Lulu Yilun Chen – Bloomberg
Evergrande Property Services passed hearing in Hong Kong; Parent among property firms facing new debt reporting rules
Evergrande Property Services Group Ltd. has received the green light from the Hong Kong stock exchange to go public, according to a person familiar with the matter, creating one more avenue for the indebted developer to raise cash.
First buy-side client inflation swap trades cleared at Eurex
Aegon Asset Management becomes the first buy-side client to clear Zero Coupon Inflation Swap transactions at Eurex; J.P. Morgan acted as executing and clearing broker; Eurex continues to see regular dealer-to-dealer volumes since the first transactions were cleared in June
Eurex Clearing has seen the first buy side Inflation Swap trades cleared on its platform, while dealer-to-dealer volumes continue to grow. The trade was completed by Aegon AM, while J.P. Morgan acted as executing broker and clearing broker. This trade shows both client demand and the support of dealers in providing liquidity for the clearing of these instruments at Eurex.
Euro Fixed Income Futures: Definition of reporting and position limits for December 2020; Eurex Circular 088/20 Euro Fixed Income Futures: Definition of reporting and position limits for December 2020
1. Introduction – Position limits apply only to long positions in the front month contracts of the products concerned. Reporting limits will be valid from 30 November 2020 after close of trading until
3 December 2020 after close of trading.
Eurex Exchange Readiness Newsflash | Outlook for 2021, readiness videos
Dear Eurex Participant,
We are delighted to provide you with a sneak peek on what we are planning for 2021. In our keynote, Wolfgang Eholzer, CTO of Eurex Frankfurt AG and Manfred Matusza, CTO of Eurex Clearing AG, talk about the highlights of 2020 and how the Trading and Clearing IT Roadmap 2021 looks like. See the keynote here: Highlights of 2020 and the Trading & Clearing IT Roadmap 2021.
Eurex KOSPI derivatives: Changed trading hours on 3 December 2020; Eurex Circular 087/20 Eurex KOSPI derivatives: Changed trading hours on 3 December 2020
1. Introduction – Due to the South Korean Exam Day on 3 December 2020, changed starting times for Pre-Trading and Continuous Trading will apply on that day for trading of the Eurex KOSPI derivatives (FMK2, OKS2).
Performance Bond Requirements: Interest Rate Margins – Effective November 12, 2020
As per the normal review of market volatility to ensure adequate collateral coverage, the Chicago Mercantile Exchange Inc., Clearing House Risk Management staff approved the performance bond requirements for the following products listed in the advisory at the link below. Please email any questions to Clearing.RiskManagement@cmegroup.com
NYMEX Dutch Natural Gas, UK Natural Gas, and Coal Early Exercise and Assignment Timeline Changes – Effective: CME Group
Please be advised we have updated the exercise and assignment timeline for the following products effective with the next scheduled option expiration.
Latest Charles Li Direct: Sowing The Seeds Of Future Growth – HKEX Chief Executive Charles Li
In his latest blog, HKEX Chief Executive Charles Li notes that a key factor to support the resilience of Hong Kong’s financial market is to plan ahead and sow the seeds for tomorrow.
FIA Expo – CCPs, clearing members debate margin floors, ‘ad hoc’ calls; Though differing on some issues, panelists at FIA Expo support global standards for intraday calls
Jeff Reeves – FIA
Derivatives clearinghouses and their members once again debated margin-related issues on 10 November at an FIA Expo panel on how the global clearing ecosystem functioned during market volatility in 2020. This time, however, the two primary areas discussed were around strengthening initial margin floors for certain products and creating consistency and predictability for intraday margin calls – and on the latter issue, CCPs and their members found some common ground.
Broadridge Financial Solutions, Inc.; R.J. O’Brien & Associates
R.J. O’Brien & Associates
Broadridge Financial Solutions, Inc. (NYSE:BR), a global Fintech leader, today announced that R.J. O’Brien & Associates (RJO), the oldest and largest independent futures brokerage and clearing firm in the United States, has selected Broadridge’s post-trade platform to deliver transformational levels of efficiency across its global exchange-traded derivatives operations.
Dell, FedEx, Switch Team Up to Build Nationwide Cloud Service
Nico Grant – Bloomberg
Partnership offers alternative to major public-cloud providers; Technology ‘hubs’ will be set up at existing FedEx facilities
Dell Technologies Inc., FedEx Corp. and Switch Inc. are building a U.S. network of data centers, offering businesses an alternative to maintaining their own server farms or using major cloud providers such as Amazon.com Inc. and Microsoft Corp.
How Hedge Funds Seek Covid Clues in Alternative Data: QuickTake
Jeff Kearns – Bloomberg
For investors, nothing has underscored the immediacy and utility of so-called alternative data as much as the coronavirus lockdowns that throttled economic activity overnight. Traditional sources of market-moving information such as monthly or even weekly government reports were outdated before publication. Those seeking a more real-time pulse turned to the torrents of terabytes produced every day by web searches, tweets, credit-card purchases and satellites for insights on such metrics as foot traffic at shopping malls or how many people were eating out at any given time.
BMLL drives forward with US expansion under new partnership with DIH; The BMLL Data Feed and Data Lab will be distributed by?Data In Harmony (DIH)’s?network of buy-side players and service providers.?
Annabel Smith – The Trade
Data engineering and analytics firm BMLL Technologies is continuing its expansion in the US after making its Data Lab and Data Feed available to market participants in the US via the Data In Harmony (DIH) network.
Nasdaq?Fixed Income EMEA sales head joins?TransFICC; Gary Vann joins?TransFICC?as head of sales after seven years as head of EMEA sales and account management at Nasdaq Fixed Income.?
Annabel Smith – The Trade
Fixed income and derivatives venue connectivity specialist?TransFICC?has appointed a former Nasdaq Fixed Income senior sales executive to head up its global sales operations.? Gary Vann joins?TransFICC?as head of sales from Nasdaq Fixed Income where he was head of sales and account management for the EMEA region for seven years.? ?
Charles River and Eze Software deals looking like shrewd moves two years on; State Street and SS&C announce milestones for their front-to-back offerings after integrating front-office providers into their end-to-end services.
Jon Watkins – The Trade
In 2018, two front-office investment software providers found new homes in the form of back- and middle-office behemoths, State Street and SS&C Technology.
Eventus Systems to provide trade surveillance, AML transaction monitoring for BitMEX; Cryptocurrency products platform to deploy Validus solution
Eventus Systems, Inc., an award-winning global provider of multi-asset class trade surveillance and market risk solutions, announced today that 100x Group, the holding structure for BitMEX, has selected Eventus to support BitMEX’s trade surveillance and Anti-Money Laundering (AML) transaction monitoring. BitMEX, a cryptocurrency products trading platform, will deploy the cloud-based version of the Eventus Validus platform within the next few weeks.
Ethereum’s ‘Unannounced Hard Fork’ Was Trying to Prevent the Very Disruption It Caused
Colin Harper – CoinDesk
At first, it was an apparent issue with Infura, the ConsenSys-run servers that keep a majority of decentralized finance (DeFi) applications synced to the Ethereum network.
Biden presidential win seen as a ‘good thing’ for cryptocurrency
Jen Wieczner – Fortune
With Joe Biden poised to become President of the United States in January, Bitcoin enthusiasts are also hoping the new White House will have a friendlier tone toward cryptocurrency than Donald Trump did. “I think we have opportunity in a Biden administration,” said Kristin Smith, executive director of the Blockchain Association, a trade group representing the cryptocurrency industry.
DeFi Mania Cools With Bitcoin Back in the Crypto Spotlight
Olga Kharif – Bloomberg
The biggest casualty of the current Bitcoin renaissance? Cryptocurrencies linked to decentralized finance applications, the favorite darling of the digital-money crowd this summer. While Bitcoin has climbed about 50% since early September, DeFi coins — used largely for speculation within apps that let investors lend to, trade with and borrow from one another — have tumbled after posting triple-digit returns just months earlier.
Bridgewater’s Ray Dalio says bitcoin isn’t poised for the success its adopters hope
Aislinn Keely – The Block
Bridgewater Associates founder and CIO Ray Dalio is expecting the growth of central bank digital currencies (CBDCs), but says he still sees problems with bitcoin as a currency. Dalio broke down his thoughts on bitcoin on Yahoo! Finance earlier this week. He said that, theoretically, bitcoin could be used as currency, but because it is too volatile to be a stable store of wealth and there are too few use cases for it to be used as a medium of exchange, it fails in practice. Additionally, Dalio said bitcoin’s lack of government control could stand in the way of its use as currency.
Bridgewater’s Dalio Sees Governments Banning Bitcoin Should It Become ‘Material’
Kevin Reynolds – Coindesk
Ray Dalio, the founder and co-chairman of Bridgewater Associates, the world’s largest hedge fund, said he sees three main problems with bitcoin and other cryptocurrencies that will limit their future, including that governments will “outlaw” them should they start to become “material.” In an interview with Yahoo Finance, Dalio said he expects more digitized versions of government-issued currencies in the future than bitcoin and other cryptocurrencies for three reasons:
Russian Ministry Moves to Soften Requirements for Crypto Tax Reporting
Anna Baydakova – Coindesk
Russia’s Ministry of Finance has proposed new amendments to the country’s coming law on crypto assets that could soften the requirements for cryptocurrency taxpayers, news agency RBK reported Thursday. According a package of draft bills, individuals must report their holdings if annual transactions exceed 600,000 Russian rubles (about $7,800). In a previous proposal, the ministry had sought disclosure when transactions pass 100,000 rubles (around $1,300) in one year.
Number of Bitcoin ATMs Up 85% This Year as Coronavirus Drives Adoption
Omkar Godbole – Coindesk
The number of bitcoin automated teller machines (ATMs) across the globe has surged this year amid the coronavirus-induced shift toward contactless payments. Bitcoin (BTC, +1.80%) ATM installations have increased by 85% to 11,798, outpacing the previous year’s near 50% rise by a significant margin, according to data source Coin ATM Radar.
Binance Gives $200K to Investigators Who Helped Identify Actors Behind 2018 Attack
Daniel Palmer – Coindesk
Cryptocurrency exchange Binance has followed through with its pledge to reward anyone helping bring about the arrest of the bad actors who attacked the exchange in March 2018 and stole from users in a phishing campaign.
BlockFi plots retail launches in Europe — but not the UK
Ryan Weeks – The Block
Crypto lending startup BlockFi is planning to roll out its retail products in Europe early next year. The initiative will debut in Switzerland, the Netherlands and Italy in the first quarter of 2021, according to David Olsson, the firm’s vice president for Europe and Asia. Olsson was hired in May to lead the company’s expansion in the region. “They’re large enough markets that it’s worth our while to go in and put the resources to work to get traction there, and there is also the regulatory certainty that they’re more pro-crypto and it’s a stable regulatory environment,” he said. BlockFi has already begun testing its retail products in Italy.
Chainalysis Wants to Help the Feds Sell Millions in Forfeited Bitcoin
Danny Nelson – Coindesk
Chainalysis is preparing to help its government clients sell the same trove of forfeited cryptocurrencies the blockchain tracing company often assists in tracking down. On Thursday, Chainalysis unveiled a program for storing and selling forfeited crypto in partnership with confiscated asset consultancy Asset Reality. The program will likely cater to many of the same government clients that already pay Chainalysis millions of dollars annually to help trace illicit crypto transactions.
MakerDAO’s DAI Stablecoin Breaks $1B Market Cap
Brady Dale – Coindesk
The stablecoin dai (DAI) broke a market capitalization of $1 billion on Wednesday, according to CoinGecko. “One billion Dai in circulation is a huge milestone and a powerful validation that people around the world want more access, more transparency and more opportunity to maximize their economic potential,” Rune Christensen, MakerDAO’s founder, told CoinDesk through a spokesperson. Supply actually increased by $30 million at one point today, the MakerDAO Foundation confirmed, though it provided no additional details.
How the Police Helped Get Biden Elected; Demonstrations against police violence seem to have mobilized Democrat voter turnout, rather than hurt it as some feared.
Brentin Mock – Bloomberg
Ever since the killing of George Floyd in May set off a wave or protests against police violence across the U.S., there have been grumblings that messages attached to those demonstrations would either derail Democrats hopes for Election Day, fire up President Donald Trump’s base, or both.
Why Trump Fears Leaving the White House; Losing the presidency leaves him vulnerable to financial and legal danger.
Timothy L. O’Brien – Bloomberg
Donald Trump is the luckiest man alive. Unlike almost, well, everyone, he’s been protected from the consequences of his own mistakes his entire life. Born into a wealthy family, he was insulated from lukewarm academic prospects and serial business crack-ups by his father’s money. (“I often say that I’m a member of the lucky sperm club,” is how he put it in one of his books.) Emerging as a reality-TV star in the early 2000s, Trump discovered that fame allowed him to be as predatory as he pleased without repercussions. (“When you’re a star, they let you do it.”) And his 2016 ascent to the White House opened his eyes to the presidency’s legal armor — which he interpreted broadly and often inaccurately. (“I have an Article II, where I have the right to do whatever I want as president.”)
Gambling Sites Are Holding Onto Millions in Payouts in Case Trump Wins; Recounts and litigation mean winners could be waiting for a while.
Donald Moore – Bloomberg
Gamblers who made big bets on the results of the U.S. presidential election are still waiting for their money. News networks on Saturday called the contest for former Vice President Joe Biden, but major betting companies are withholding payouts on hundreds of millions of wagers throughout the world. In the meantime, they’re continuing to take bets as the odds fluctuate and President Donald Trump continues to press his legal case.
EU Defends LGBTIQ Rights in Its First Ever Equality Strategy
Stephanie Bodoni – Bloomberg
EU plans to fight hate crime, discrimination, give same rights; European Commission plans targeted actions for coming years
The European Commission unveiled proposals to defend the rights of people who identify themselves as “lesbian, gay, bisexual, transgender, intersex, or questioning.” The LGBTIQ measures are part of the first-ever equality strategy from the European Union’s executive arm, laying out targeted actions for the coming five years, including a push for all EU nations to follow.
Donald Trump is not done with America yet; His unsubstantiated allegations of voter fraud are weakening the US political system
Edward Luce – FT
No, Donald Trump is unlikely to pull off what the Spanish call an autogolpe — a government self-coup. But that will not be for lack of trying. The US has never experienced a losing incumbent who insists the election was stolen. It is hard to think of a genuine democracy where that has happened.
Democracy or dictatorship? Trump’s post-election moves spark outcry; Refusal to accept result and defence secretary’s firing fan fears president will try to stay in office
Demetri Sevastopulo and Katrina Manson – FT
He fired his defence secretary, installed a conspiracy-minded loyalist as chief counsel at an intelligence agency, and tapped a retired army colonel who backed martial law on the Mexican border for a top Pentagon job.
President Trump’s Show Has Been Canceled; For years, we’ve been living inside a story defined by Donald Trump’s reality-TV worldview. America finally changed the channel.
James Poniewozik – NY Times
Many incumbent presidents have gone on the campaign trail to make their cases for a second term. Donald J. Trump was the first to campaign for a second season. At a 2019 campaign rally in Minnesota, he described his victory in 2016 as “one of the greatest nights in the history of television.” And he often seemed to cast his re-election argument less in terms of policies than as a TV producer’s pitch to keep the show going.
The Faithful Voters Who Helped Put Biden Over the Top; The president-elect’s approach to religion made a critical difference in key battleground states.
Michael Wear – NY Times
Joe Biden succeeded in his mission to end Donald Trump’s presidency, and he did so, in part, because of the wise, persistent and strategic way his campaign related to faith. This was not inevitable.
BNP Paribas Probed Over Middleman Payment for Deutsche Bank Deal
Jonathan Browning, Donal Griffin, and Harry Wilson – Bloomberg
Payment scrutinized by French anti-corruption agency AFA; French regulators preparing a report for coming weeks
BNP Paribas SA’s deal for Deutsche Bank AG’s business catering to hedge funds is being scrutinized by French regulators over a fee to a middleman. The bank paid hundreds of thousands of pounds to former Goldman Sachs Group Inc. banker Simon Lloyd months after the transaction was completed in September 2019, according to people familiar with the matter. The French anti-corruption agency, known as AFA, identified the incident during a routine audit and is due to issue a report in the next few weeks.
ESMA publishes first report on use of sanctions under the AIFMD
The European Securities and Markets Authority (ESMA), the EU securities markets regulator, today publishes its first annual report on the use by National Competent Authorities (NCAs) of sanctions under the Alternative Investment Fund Managers Directive (AIFMD).
ESMA publishes third annual report on use of sanctions for UCITS
The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, today publishes its 2019 report on the use of supervisory sanctions by National Competent Authorities (NCAs) under the Undertakings for Collective Investments in Transferrable Securities (UCITS) Directive.
TRAQS and API Testing
Currently, FINRA TRAQS and Reference Data API users are required to download a digital certificate and present verified user id and password credentials to access the website and the API. As part of its Transparency Services improvement initiatives, FINRA is introducing a new method for users to gain secure access to the TRAQS website and will be introducing a new system infrastructure.
Targeted Examination Letter on Rights of Reinstatement (RoR)
FINRA is conducting a review of firms’ systems and procedures for providing customers waivers and rebates available through Rights of Reinstatement1 (RoR) on mutual fund purchases.
FCM and IB Members—FinCEN reissues and updates its list of FATF-identified jurisdictions with AML/CFT deficiencies
On November 6, 2020, the Financial Crimes Enforcement Network (FinCEN) issued an Advisory announcing that the Financial Action Task Force (FATF) reissued its list of jurisdictions with strategic AML/CFT deficiencies, with updates to two jurisdictions. NFA Member FCMs and IBs should review this Advisory to ensure that their AML programs have the most current information on FATF-identified jurisdictions with AML/CFT deficiencies and revise their AML programs accordingly. A copy of the Advisory is available on FinCEN’s website.
Investing and Trading
VIX’s Decline Triggers a How-Low-Can-It-Go Debate: Taking Stock
Elena Popina – Bloomberg
In a matter of weeks, Wall Street worrywarts have gone from fretting over high volatility to fearing bets on stock swings are falling too fast. Strategists at Evercore ISI on Tuesday joined calls last week from their counterparts at Tallbacken Capital and WallachBeth Capital who said it’s time to close bets that price moves for the largest U.S. companies will keep falling. The rationale: hospitalizations in the U.S. are reaching record high levels, while the Cboe VIX Index has already dropped to its lowest level since August. Betting on lower volatility at this point may not be worth the risk, they say.
Covid Crisis Brings Regime Change for World’s Central Banks
Craig Torres, Lucy Meakin, and Jeff Black – Bloomberg
Fiscal policy now seen more vital to spur economic rebound; Central banks could face long-term credibility questions
Just eight months after they swung into action to avert a crippling depression and credit crunch, central banks are in the uncomfortable position of relying on governments to power fragile economic rebounds.
BoE governor says vaccine advance is ‘very encouraging’ for UK economy; Andrew Bailey optimistic that pandemic’s long-term damage should be less than previous recessions
Delphine Strauss – FT
A breakthrough in developing a coronavirus vaccine is “very encouraging” for the UK economy, the Bank of England governor said on Thursday, strengthening the central bank’s view that the long-term restructuring needed after the pandemic will be more modest than in the 1980s or 1990s.
IEA says coronavirus vaccine unlikely to boost oil market until late 2021; Energy body says demand for crude will fall more than it previously expected this year
Anjli Raval – FT
A Covid-19 vaccine is unlikely to ride to the oil market’s rescue until late next year at the earliest, the International Energy Agency said on Thursday.
Betting group GVC to change name and exit unregulated markets; Ladbrokes owner to rebrand as Entain as it aims for fresh start under new chief executive
Alice Hancock – FT
GVC, owner of the bookmaker Ladbrokes Coral, will rebrand as Entain and pull out of all unregulated gambling markets as it seeks to clean up its act following the departure of its previous chief executive.
Deposit Rates Are Taking a Pandemic Nosedive
Even banks that normally tout high deposit rates, like Ally and Marcus, are slashing what they are willing to pay
Orla McCaffrey – WSJ
Banks are paying a pittance on deposits, but customers don’t seem to care. Some banks are slashing deposit rates. Others are keeping already-low rates at next to nothing, sometimes 0.01%. But customers keep stashing cash at banks anyway.
Environmental, Social and Corporate Governance
Covid Restaurant Shutdowns Threaten Oil Refiners’ Biofuel Dreams; With fewer people eating out, refiners with millions on the line are racing to secure used cooking oil to feed their plants.
Robert Tuttle – Bloomberg
Every day, Miko Del Rosario oversees nine trucks that crisscross Southern California, weaving through alleys behind shopping malls, restaurants and a tortilla chip factory to pick up cooking oil drained from deep fryers.
Samsung financial units pledge to halt coal investments; Investors welcome move as conglomerate’s other subsidiaries vow to exit from fossil fuels
Song Jung-a – FT
Samsung Group’s financial units have pledged to stop all investment in new coal projects, including via bonds or insurance underwriting, bowing to growing pressure to reduce their exposure to fossil fuels.
When Will Electricity Companies Finally Quit Natural Gas? Wind and solar are better bets for investors and the planet.
Justin Gillis and Michael O’Boyle – NY Times
A photovoltaic power station in Florida.Credit…Jeffrey Greenberg/Universal Images Group, via Getty Images
As Americans suffer through immense wildfires, rising coastal flooding and an epic hurricane season, the nation’s corporations want you to believe they are coming to grips with the climate crisis.
Nothing Can Replace the Office, Standard Life Aberdeen CEO Says
Suzy Waite – Bloomberg
Fund manager’s new head says he’s no fan of working from home; Deutsche Bank research suggested a tax on remote workers
The new head of Standard Life Aberdeen Plc has made his stance clear on working from home: there’s nothing quite like the office. With most of the U.K. asset manager’s almost 4,500 employees currently working remotely, Chief Executive Officer Stephen Bird has signaled that they shouldn’t get too comfortable in their makeshift offices. While some aspect of flexibility is likely to be part of the company’s future, he’s not convinced that it’s the answer to better productivity.
Daniel Loeb’s Third Point gains nearly $400m on US election call; Billionaire Jeffrey Talpins also positioned himself for market rotation with bet on Pfizer findings
Laurence Fletcher and Ortenca Aliaj – FT
Daniel Loeb’s Third Point gained nearly $400m in a bullish bet on the outcome of the US election, positioning the billionaire as one of the hedge fund winners from recent market gyrations.
Hunt for Moscow Financier Owing Millions Leads to Mojave
Hugo Miller – Blooomberg
German Lillevali was detained at ICE facility in California; Ex-financier ordered to pay $32 million in damages by judge
German Lillevali can thank the coronavirus for getting out of an immigration facility in the California desert, but his troubles are far from over. The former financier had changed his name and left Moscow two years ago owing clients millions before being detained in the U.S. for overstaying his visa. After a judge released him to reduce overcrowding to avoid a Covid-19 outbreak at the detention center, his next challenge is to dodge deportation to Europe where he faces multiple investigations.
China Won the Cold War. Here’s What That Means for Free Markets ; An Economist’s Guide to the World in 2050
Tom Orlik and Bjorn Van Roye – Bloomberg
Who really won the Cold War? Maybe China. In 1972, Cold War logic pushed President Richard Nixon into an unlikely alliance with Mao Zedong—bringing China back into the mainstream of the world economy. In 1991, the collapse of the Soviet Union encouraged “end of history” hubris that blinded the West to the consequences of China’s rise.
Sotiris Nikas and Paul Tugwell – Bloomberg
Government is trying to bring in investment, stem brain drain; Program envisaged appealing to people able to work from home
Greece wants to use its solid track record in combating the coronavirus as a way to help entice people to move to the country — and it’s promising that half of their income will be tax-free.
Egypt’s Focus on Local Sugar Is Bad News for European Exports
Manisha Jha and Abdel Latif Wahba – Bloomberg
Egypt’s beet-sugar output seen rising 16% in 2020-21 season; Nation has also extended an import ban through November
After a drought and crop disease, add a shrinking export market to the list of headaches for the beleaguered European sugar industry. The European Union — which saw its white-sugar shipments slump to an almost decade-low last season — now faces the prospect of losing a major export market as Egypt bolsters local output and cracks down on imports. The North African nation was the EU’s second-biggest export market just two years ago. Sales there dropped to a four-year low last season and risk falling even more.
Saudi Arabia to Scrap Public State-Run Barley Tenders for Private Deals
Reema Al Othman and Megan Durisin – Bloomberg
Private sector to take over process of importing barley; Tenders have given an insight into prices and trade flows
Saudi Arabia, the world’s biggest barley buyer, is poised to stop running government tenders for the grain as the kingdom shifts toward private deals for imports. The Riyadh-based Saudi Arabia Grains Organization will stop running the tenders once private companies fully take over the process of importing and selling barley, according to two officials with knowledge of the matter. The state-run Saudi Press Agency said Tuesday private entities have been assigned the process of importing and selling barley, citing a cabinet statement.
Ghana Forces Eni to Merge Oil Field With Local Firm’s Discovery
Ekow Dontoh and Yinka Ibukun – Bloomberg
Government seeks optimum exploitation of petroleum resources; Italian company to remain operator of Sankofa-Afina fields
Ghana’s government is forcing Eni SpA to merge its Sankofa offshore oil field with a neighboring discovery made by a domestic explorer and imposing its own terms on the deal, according to a letter seen by Bloomberg.
It’s not just Ant: Chinese stock exchange turns down another IPO
Just over a week since the Shanghai Stock Exchange’s stunning suspension of Ant Group Co.’s blockbuster listing, its rival in Shenzhen turned down another hopeful for the first time since new rules were adopted to quicken the share sale process.
World-Beating Rate Leaves Egypt With Options: Decision Day Guide
Mirette Magdy – Bloomberg
Economists split on the likelihood of second consecutive cut; Authorities may be able to balance stimulus, allure of debt
Egypt may be able to have it both ways this week: enacting monetary easing to fight the economic impact of Covid-19 without dimming the allure of its carry trade.
Burberry Warns No-Deal Brexit Would Lead to Higher Duty Bill
Angelina Rascouet – Bloomberg
Burberry Group Plc warned that it faces the risk of being saddled with higher costs from a no-deal Brexit, while a possible U.K. clampdown on duty-free shopping may erode revenue. The trenchcoat maker would face “low tens of millions” of pounds in additional duties if the U.K. fails to reach a trade agreement with the European Union, Chief Financial and Operating Officer Julie Brown said on a call with reporters.
U.K. Steps Up Talks With Industry as Brexit Disruption Nears
Joe Mayes – Bloomberg
The U.K. government is intensifying talks with industry as it seeks to avert Brexit disruption at year-end, with companies facing upheaval even if Britain and the EU sign a trade deal. Ministers will hold weekly meetings with the country’s five biggest business groups and particularly-affected sectors to discuss Brexit preparations, the Cabinet Office said in an e-mailed statement. The government has previously expressed concern that many firms have their “heads in the sand” and are ill-prepared for Brexit.
Irish PM says Biden wants a Brexit deal so Johnson should knuckle down
Guy Faulconbridge and Alistair Smout – Reuters
Irish Prime Minister Micheal Martin said on Thursday that U.S. President-elect Joe Biden wanted Britain to reach a Brexit trade deal with the European Union, so Prime Minister Boris Johnson should knuckle down to securing one.
With Donald Trump gone, Brexit Britain will be very lonely on the world stage
Afua Hirsch – The Guardian
After the election of Donald Trump in 2016, an American friend compared the nativist populism of the United States with the state of Brexit Britain. “You think it’s bad that Britain voted to leave the EU,” he told me. “America has voted to leave itself.”
Nobel laureate urges Boris Johnson to commit to £80bn EU science scheme
Lisa O’Carroll – The Guardian
Fears are growing the UK is on the verge of losing its place at the heart of Europe’s prestigious medical and scientific research programmes because of a Brexit row. One of the country’s leading scientists has written to Boris Johnson warning of heightened concern over the EU’s flagship £80bn Horizon Europe programme, which pools talent and ideas that have produced breakthroughs on everything from leukaemia treatments to hydrogen cells that fuel zero-emission buses.
Medicine supply chains to change post Brexit, MPs told
Enda McClafferty – BBC News
Supply chains bringing medicines into Northern Ireland will change “significantly” after Brexit, MP’s have been warned. They were also assured there will be no disruption to the availability of drugs and the current safety standards will be maintained. Members of the Northern Ireland Affairs Committee heard evidence on Wednesday from the pharmaceutical industry. It focused on the impact of Brexit on the supply of medical drugs.
UK tries to reassure business leaders over Brexit with new task force
Andrew MacAskill – Reuters
Britain will attempt to reassure nervous business leaders that it appreciates the need for clarity on rules outside of the European Union by setting up a task force to discuss challenges 50 days before the transition period ends. The United Kingdom left the EU in January, but the sides are trying to clinch a deal that would govern nearly 1 trillion dollars in annual trade before the status quo transitional arrangements end on Dec. 31. Outside the EU’s single market where trade flows freely, Britain’s exporters will have to complete a raft of paperwork including customs and safety declarations and deal with multiple IT systems to gain entry to Europe.
This $58 Million Hollywood Hills Home Includes an Aqueous Amenity: Its Own Lazy River; The founders of hair-care brand Bed Head, who are selling the 15,000-square-foot home, built the water feature into their pool area
Katherine Clarke – WSU
In the Hollywood Hills, a colorful mansion with its own lazy river is coming on the market for $58 million. It is one of the most expensive homes to hit the market in the Los Angeles area in recent months.