First Impressions

Bill Templer, Managing Director, Faventus Derivatives Consulting – Stretch Beyond Your Desk
JohnLothianNews.com

“Whatever you do end up doing, find something in it that you can be the best at.”

Bill Templer, managing director for Faventus Derivatives Consulting, discusses the charitable side of his life and his work with Futures For Kids, an organization that raises money to support children living in poverty. Templer describes how Futures For Kids began with a group of individuals in the financial industry and how his work was able to lead him to new networking and job opportunities. Templer also discusses his career history and creates a list of advice he wished he knew when he was younger.

Watch the video »

Quote of the Day

“When people use computers to provide prices across markets it [liquidity] can be withdrawn in a heartbeat.. How much market liquidity really exists under this type of market structure and what changes should be made are the questions for regulators.”

James Angel, associate professor at Georgetown University in the story, “Bonds: Anatomy of a market meltdown”.

Lead Stories

Deutsche Bank Ends Most CDS Trade
Katy Burne and Eyk Henning – WSJ
An investment blamed for accelerating the 2008 financial crisis is withering as new rules and placid markets push trading elsewhere.
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Bonds: Anatomy of a market meltdown
Tracy Alloway and Michael MacKenzie – Financial Times
Legend has it that a young man once asked the financier J Pierpont Morgan what the stock market was going to do. “It will fluctuate,” Mr Pierpont is said to have replied. Had the young man asked Mr Pierpont about today’s US Treasury market – where the US government sells trillions of dollars worth of bonds to a wide range of investors – he may have received a very different response.
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U.S. Said to Pursue Charges Against More Mortgage Traders
Matt Robinson, Jody Shenn and Keri Geiger – Bloomberg
The U.S. government is building potential securities fraud cases against more Wall Street mortgage-bond traders after winning a conviction this year against a former Jefferies Group LLC trader, according to two people with knowledge of the investigations.
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Flash Boys Raising Volatility in Wild New Treasury Market
Susanne Walker and Lisa Abramowicz – Bloomberg
In a flash, the bond market went wild. What began on Oct. 15 as another day in the U.S. Treasury market suddenly turned into the biggest yield fluctuations in a quarter century, leaving investors worrying there will be turbulence ahead.
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SunGard expands fixed income connectivity
John Bakie – The Trade
SunGard has added fixed income market MTS BondVision to its connectivity platform to facilitate clients trading cross-asset class.
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The bond market’s dance over European debt will not last forever
Barry Eichengreen – Financial Times
The dismal third-quarter growth figures for the eurozone last week underscore, once again, doubts about the sustainability of sovereign debts.
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Once Again, Europe And The Eurozone’s Problem Is Monetary, Not Fiscal
Tim Worstall – Forbes
If you’re a Keynesian you’ll be pointing at the current economic malaise in the eurozone and shouting that this is a fiscal problem. That governments should, in a recession or near depression, be spending more, fiscally stimulating the economies. It’s only because everyone is in thrall to austerity that the bad times are continuing. If you’re of a more monetarist cast of mind you’ll equally be leaping up and down shouting that it’s all a monetary problem.
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Central Banks

Elizabeth Warren and Joe Manchin: The Fed Needs Governors Who Aren’t Wall Street Insiders Elizabeth Warren And Joe Manchin – WSJ
We joined the Senate Banking Committee to try to make the banking system work better for American families. That’s why we’re concerned that the Federal Reserve—our first line of defense against another financial crisis—seems more worried about protecting Wall Street than protecting Main Street. Fortunately, this is one problem the Obama administration can start fixing today by nominating the right people to fill the two vacancies on the Fed’s Board of Governors.
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The Fed’s Regional Banks Opened 100 Years Ago With Grand Ambitions
Ben Leubsdorf – WSJ
The Federal Reserve this week marks the 100th anniversary of its dozen regional banks opening for business.
“The opening of these banks marks a new era in the history of business and finance in this country,” declared a press release from Treasury Secretary William McAdoo, dated Nov. 15, 1914. “It is believed that they will put an end to the annual anxiety from which the country has suffered for the past generation about insufficient money and credit to move the crops each year, and will give such stability to the banking business that the extreme fluctuations in interest rates and available credits which have characterized banking in the past will be destroyed permanently.”
Well, maybe that last part went a little far.
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Draghi Sounds Hopeful Note on Europe’s Economy, but Reassures That E.C.B. Is Ready to Act
JACK EWING – NY Times
The president of the European Central Bank on Monday gave a slightly more optimistic assessment of the eurozone’s economy, saying that a decline in bank lending appears to have reversed and pointing out that the economies in most countries in the region are growing.
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ECB Plans ‘Intrusive’ Probe of Banks’ Risk-Weight Models
Jim Brunsden and Nicholas Comfort – Bloomberg
The European Central Bank plans to clamp down on the complex models lenders use to gauge the risk of their assets, as it works to restore trust in the euro area’s financial system.
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Fed Faces an Inflation Conundrum–Ahead of the Tape
Spencer Jakab – WSJ
Goldilocks hasn’t yet bolted from the cabin, but she’s edging closer to the door.
Predictions she would get scalded by runaway inflation resulting from easy money have been wrong so far. Now, though, the impending end of those policies has coincided with chilly market forces that could push price gauges below the range the Federal Reserve considers healthy. If so, the U.S. would be joining other large, developed economies facing similar conditions.
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Currencies

Window for London FX ‘fixing’ to widen after trading row
Patrick Graham – Reuters
London’s benchmark foreign exchange “fixings” will move to a five-minute calculation window, from one minute currently, as of 2200 GMT on Sunday, Dec. 14, the WM Company said in a memo sent to banks on Monday.
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Thirty firms placed under FX ‘remediation programme’
Risk.net
The Financial Conduct Authority (FCA) is understood to have placed a further 30 banks and non-banks with G-10 foreign exchange spot desks under supervisory measures after discovering widespread evidence of poor practice, according to a source.
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Argentina steps up fight against black market dollar trade
Reuters
Argentina, which faces an acute hard currency shortage, sought to toughen international trade controls on Monday by creating a new agency to keep track of imports and exports and said it would keep tightening currency restrictions.
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CFTC Commissioner Says Agency Has Authority Over Bitcoin Price Manipulation
Michael J. Casey – WSJ
A commissioner at the Commodity Futures Trading Commission said Monday that the agency was authorized to intervene with enforcement actions against price manipulation in bitcoin markets.
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Gold

The London fix: making a golden molehill out of a mountain
John Dizard – Financial Times
Being a gold trader these days must be a bit like going through airport security on your way back from working in a medical clinic in west Africa. More difficult, really, because there is public admiration for people who are willing to put themselves at risk to treat Ebola patients.
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The Fund that Reshaped the Gold Market
Tatyana Shumsky – WSJ
The first U.S. exchange-traded fund to give investors a stake in gold was the fastest-growing financial product of its kind when it launched 10 years ago. Today, SPDR Gold Trust, better known by its ticker symbol GLD, is the fastest-shrinking.
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