First Impressions

Bits & Pieces
By John J. Lothian

If you are going to sign up interns, newer employers, or are interested yourself in attending the New York sessions of MarketsWiki Education’s World of Opportunity Summer Intern Education Series, the time is now.

If you have had trouble registering because we used Google Doc Forms for the process, just email me at johnlothian@johnlothian.com and give me the following information: names of interns, interns’ email addresses, which sessions they want to attend and to whom to send the invoice.

We have added James Gellert of Rapid Ratings and FinTech entrepreneur John Edge to our New York Summer Intern Series speaker list, rounding out the list of ten. Our lineup includes all segments of the financial sector – brokers, bankers, proprietary traders, exchange executives and more. As this is our first foray into New York, what we need now more than anything is attendees.

Though our speaker lineup covers the entire financial spectrum, a number of them are options-focused, including Ed Boyle of BOX, John Fennell of the OCC and the CBOE‘s Andrew Lowenthal in Chicago, plus ISE‘s Boris Ilyevsky in New York.

Please help us spread the word by sharing this information and registration page with everyone you know that may benefit – interns, college students and young professionals just entering the financial space. Actually, send anyone, including yourself, if interested. As an added enticement, our hosts at the NYSE have offered a limited number of spots for a tour of the trading floor in between sessions. If you have never set foot onto the floor, this may be your last chance.

Like everything we do, this is a grassroots effort, and that means we rely heavily on our friends in the industry to spread the word. While that list includes CME Group, global premier sponsor of the 2015 series, it could not be done without the word-of-mouth and email forwarding campaign with which we hope you will participate.

Quote of the Day

“I don’t really follow news on stocks that closely. My hairdresser said it was still a bull market and I needed to get in.”

Sophie Wang, a 32-year-old college art teacher in Nanjing in the story, “How Chinese Stocks Fell to Earth: ‘My Hairdresser Said It Was a Bull Market'”

Lead Stories

Greece Given Hours to Save Place in Euro
Bloomberg
Greek Prime Minister Alexis Tsipras was given hours to come up with a plan to keep his country in the euro and stave off economic disaster as citizens suffer under a second week of capital controls.
Adding to the pressure, the European Central Bank made it tougher for Greek banks to access emergency loans. German Chancellor Angela Merkel said “time is running out,” as she and French President Francois Hollande responded to Sunday’s referendum result in Greece. Euro-region finance ministers gather for an emergency meeting on Tuesday.
jlne.ws/1RgZPxx

Chinese Share Sell-Off Spills Over to Hong Kong
NY Times
Heavy government-coordinated purchases pushed up the value of large companies’ shares on mainland Chinese stock exchanges on Monday, interrupting at least temporarily a three-week downturn. But shares in smaller and midsize companies, which make up as much as two-thirds of the market by value, kept falling.
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Greek Contagion Muted Across Markets as Crisis Seen Quarantined
Bloomberg
Financial markets barely shuddered after Greek voters rejected austerity demands, in a sign investors see the nation’s crisis contained for now. Crude tumbled the most in five months.
The Standard & Poor’s 500 Index slipped 0.4 percent at 4 p.m. in New York, while the Stoxx Europe 600 Index lost 1.2 percent. The declines were muted compared with a week ago, when Greece first announced a referendum. The euro fell to $1.1054, paring a loss of as much as 1 percent. Treasury 10-year yields dropped 10 basis points to 2.29 percent.
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Germany Maintains a Hard Line on Greece Debt After Vote
NY Times
Germany maintained a hard line with Athens on Monday after Greek voters rejected Europe’s austerity policies in a referendum, intensifying pressure on Prime Minister Alexis Tsipras to restart bailout talks and opening a rift with European countries that appeared more inclined now to consider softening the push for austerity.
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Hours After Exit, Varoufakis Emerges as #MinisterOfAwesome
MoneyBeat – WSJ
Just three-and-a-half hours after controversial Greek finance minister Yanis Varoufakis resigned, his London-based book agents sent around a public-relations email offering excerpts from his updated book, the Global Minotaur, and other pieces of information.
The communications director at Zed Books, the publisher of Mr. Varoufakis’s book, sent your correspondent an email describing Mr. Varoufakis as the “possibly the coolest, charismatic and most intelligent Finance minister ever” and even suggested a hashtag: #MinisterofAwesome.
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How Chinese Stocks Fell to Earth: ‘My Hairdresser Said It Was a Bull Market’
By SHEN HONG, WSJ
On a hot, humid Sunday afternoon in mid-June, around 600 eager stock investors packed the largest ballroom at the Grand Hyatt in Lujiazui, Shanghai’s equivalent of Wall Street.
jlne.ws/1CVKkiA

U.S. banks post detailed crisis plans to avoid breakup threat
Reuters
The largest Wall Street banks on Monday published detailed manuals of how to shut down their business during a crisis without the help of taxpayer money, a crucial step to prevent being broken up by regulators.
After the 2007-09 financial crisis, the banks were required to submit the so-called “living wills” each year to show how they would proceed though an ordinary bankruptcy during a crisis without quietly relying on government support.
jlne.ws/1RgZtqF

Four-fifths of fund executives fear asset management iTunes
Chris Newlands, FT
Four-fifths of senior asset management staff expect the fund market to be disrupted by an outside participant in the same way Apple upended the music industry with the introduction of iTunes. According to a poll of 400 senior executives by State Street, the custodian bank, 79 per cent fear they will face direct competition from a non-traditional entrant to asset management.
jlne.ws/1CkuPWC

Deutsche Bank in legal wrangle over Argentine bond issue
James Shotter in Frankfurt and Joseph Cotterill in London, FT
Hedge funds are pursuing Deutsche Bank over its role in a bond issue by Argentina as the country’s smouldering dispute with holdouts over its 2001 default continues to entangle international lenders.
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Good Luck Finding a Place to Hide as Global Markets Crumble
Bloomberg
Investors tend to respond to impending doom by selling risky stuff and hiding out in safer assets — namely, bonds in places such as Germany and the U.S.
There’s a problem with that formula this time around: Traders aren’t so sure they can find anything that’s truly safe right now. So, instead of piling into sovereign debt of developed nations, traders are pulling their money out of those places as the Greek economy teeters on the brink of collapse, Puerto Rico talks about delaying some debt payments and China’s stock market suffers its biggest selloff since 1992.
jlne.ws/1Rh07o4

Conviction of Former Goldman Sachs Programmer Is Overturned
Dealbook – NY Times
A court has again overturned the conviction of Sergey Aleynikov, the former Goldman Sachs programmer charged with stealing some of the confidential computer code for the Wall Street bank’s high-speed trading program.
The ruling handed down on Monday by Justice Daniel P. Conviser of the State Supreme Court in Manhattan sets the stage for state prosecutors to either appeal the decision or let Mr. Aleynikov’s six-year legal odyssey through the federal and state court systems in New York come to an end.
jlne.ws/1NJCAG7

Central Banks

ECB Tightens Collateral Terms for Greek Bank Liquidity Aid
Bloomberg
The European Central Bank made it harder for Greece’s banks to access emergency loans, adding pressure on a country whose financial system remains shuttered as it awaits political talks in Brussels.
jlne.ws/1RgZScr

China’s Central Bank to Provide Liquidity to Help Stabilize Stock Market
WSJ
China’s central bank will provide liquidity to help stabilize the country’s crumbling stock market, according to a statement by China’s top securities regulator late Sunday.
jlne.ws/1Rh0grw

Federal Reserve charts the misery index
Memphis Business Journal
When Congress created the Federal Reserve Bank system via the Federal Reserve Act in 1913, it laid out the Fed’s objectives as maximum employment, price stability and moderate long-term interest rates.
A recent post by The Federal Reserve Bank of St. Louis shows that one way to asses the Fed’s mandate for stable pricing and employment is a combination of the unemployment rate and the consumer price index inflation rate.
jlne.ws/1Rh0mzr

Big U.S. Banks Refile ‘Living Wills’ After Regulatory Rebuke
WSJ
Twelve of the largest U.S. banks refiled with regulators their plans for navigating bankruptcy, their latest attempt to show they wouldn’t need a taxpayer bailout in a financial crisis.
Summaries of the firms’ “living wills” were set to be published Monday on the websites of the Federal Reserve and the Federal Deposit Insurance Corp. The plans, a requirement of the 2010 Dodd-Frank law, were expected to offer more details than in previous years about how each bank could fail without endangering the broader financial system.
jlne.ws/1Rh0tuI

Currencies

Any “new drachma” would sink like a stone at first
By Reuters
If a ‘No’ in Sunday’s referendum eventually takes Greece out of Europe’s single currency, any “new drachma” or temporary payment unit could be worth as little as a fifth of the euro now in circulation.
jlne.ws/1RfGmgr

Amid the Greek Crisis, Bitcoin Reminds Everyone It’s Not Perfect
Bloomberg
The economic crisis in Greece has turned some attention to Bitcoin again. The price of the digital currency has rallied over the past few days, partly because some Greeks have been snapping up the currency amid bank closures and cash withdrawal limits. It’s trading at the highest rate since March, and Bitcoin bulls expect demand to go even higher if the situation worsens. Citing the Greek crisis, Coinbase waived fees last week for customers buying Bitcoin with euros.
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Indexes & Index Products

Commodity markets diverge as supply and demand come to the fore
FT.com
Some $7.5bn flowed into passive index investments, almost as much as the first three months of the year, which saw $9.3bn in net inflows. But, ETFs suffered a $2.4bn in net outflows, according to Citigroup, with precious metal ETFs continuing their retrenchment which began in March.
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ETF? Don’t you mean EFT?
Moneyweb
Education, structural issues have hampered growth in local exchange-traded products.
jlne.ws/1TfZecO

Gold

France discreetly returns looted gold antiquities to China
Henry Samuel, The Telegraph
France has secretly returned four solid gold antiquities looted from China and bought by billionaire luxury tycoon François Pinault, as Beijing steps up efforts to repatriate pillaged art.
The return of the four gold heads of birds of prey, worth EUR1 million (£710,000), reportedly proved a diplomatic nightmare since gifts to French museums are in theory irrevocable.
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Alamos Gold completes AuRico takeover, but risk remains
Peter Koven, Financial Post
Alamos Gold Inc. last week completed its acquisition of AuRico Gold Inc., a deal that makes it a mid-tier gold producer. Alamos now has much greater scale, which should help it withstand a rough gold price environment. A positive re-rating from investors is also possible.
However, the combined company faces numerous challenges, TD Securities analyst Steven Green said.
jlne.ws/1H4YU9j

Gold Producers See Instant Advantage Should Greece Exit Euro
by David Stringer, Bloomberg
Gold producers see potential for immediate gains should Greece exit the euro having voted against additional austerity measures.
The S&P/ASX All Ordinaries Gold Index, which tracks miners in Australia, the world’s second-biggest producer, climbed 2.6 percent at 1:14 p.m. in Sydney. Miners are poised to advance along with haven assets if Greece leaves the common currency, said Raleigh Finlayson, managing director of Saracen Mineral Holdings Ltd., an Australian producer of the precious metal.
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Miscellaneous

The Broker Who Saved America
by Joshua M Brown, The Reformed Broker
You know Hancock and Washington and Franklin and Jefferson. You might even know Greene and Knox, Henry and Hale. But it is very unlikely that you know the name Haym Solomon. This is unfortunate, because he’s the guy who arranged financing to keep the Continental Army alive during its darkest days, finding the money to keep the revolution going when many were ready to throw in the towel. He was also instrumental in the founding of the Bank of North America – the country’s first “national” bank. Solomon’s contributions to the war and the founding of the nation, though seldom discussed, were of major importance.
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America’s best brokers are far from Wall Street
By John Aidan Byrne, NY Post
Brokers at regional firm Edward Jones are among the happiest in America. Forget about the big guns at Merrill Lynch and Morgan Stanley, the archrivals that raid each other’s staffs for multimillion-dollar producers and talent, bruise egos and change employee comp plans, advisers say. Edward Jones, the sedate regional broker out of St. Louis, has just pulled off the highest ranking in the J.D. Power 2015 survey of employee adviser satisfaction, followed by second-place Raymond James and third-place Charles Schwab.
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