Commentary and Insight
What’s in a name? CME’s Kim Taylor Says Extra Cost
Clearinghouses are now considered systemically important to financial markets. But with that designation are new regulations and capital requirements. John Lothian News sat down with Kim Taylor of CME Clearing to talk about how a new requirement will raise costs for market participants. Commodity Futures Trading Commission (CFTC) regulation 39-33, passed on November 15, is a capital requirement that is set to be implemented by the end of the year. It calls for US-based clearinghouses to be designated as qualified central counterparties (QCCPs), which ultimately would give them more favorable capital requirements under Basel III but tough capital US guidelines.
Gold Option Wagers on Surge to $3,000 Was Most-Active Yesterday
Nikolaj Gammeltoft & Joe Richter – Bloomberg
Wagers betting that gold prices will rally 141 percent in about two years were the most-traded option in New York bullion yesterday.
Euzo zone ‘fear’ gauge hits near seven-year low
A closely watched gauge of European stock market volatility hit a near seven-year low on Friday, a further sign of growing investor confidence that economic conditions in the region are stabilizing.
Oil market faces tight deadline for Ice Brent protocol
Alexander Osipovich – Risk.net
Oil market participants are being urged to move quickly to sign up to a new protocol aimed at ensuring the market for over-the-counter derivatives on Brent North Sea crude oil undergoes a smooth transition on December 6, when Atlanta-based Ice is set to change the expiration dates for many of its Brent futures and options contracts.
Investors wary of U.S. stock surge, even as money piles in
Luciana Lopez – Reuters
Many prominent managers at the Reuters 2014 Global Investment Outlook Summit believe the record-setting run-up in U.S. stocks is due for a reckoning but acknowledge that ample liquidity could push equities higher regardless of fears.
Market Experts Beginning to Worry
Garrett Jones – Dan Collins Report
Thursday the Dow Jones Industrial Average was up +109.17 to 16009.99 – breaking the 16,000 level and closing about that level for the first time ever. The market has continued to ‘climb the wall of worry’ as it has all year.
Videocast: Traders buy VIX 16 calls
Day JFK Died We Traded Through Tears as NYSE Shut
Bob Ivry – Bloomberg
Fifty years ago today, on the floor of the New York Stock Exchange, Michael Robbins heard a murmur. It started at the booth of a Texas firm, Eppler, Guerin & Turner Inc., and got louder, until the 30-year-old trader realized what it was: the sound of a selloff.
**I listened to an interesting bit where the Boston Symphony Orchestra was playing its usual Friday show when the conductor announced the assassination. The audience loudly gasped then gasped again when the conductor announced he would play the funeral march from Beethoven’s 3rd symphony. You can hear it here if you are interested (only 3.5 minutes long). JFK’s assassination remains the second most memorable event in US semi-recent history just a bit behind 9/11. -JB
Liffe-Euronext split timetable could be too ambitious
John Bakie – The Trade
IntercontinentalExchange’s (ICE) plans to IPO Euronext in the middle of next year could be hampered by the regulatory process, according to exchange experts.
Regulation and Enforcement
A Trading Tactic Is Foiled, and Banks Cry Foul
Floyd Norris – The New York Times
…The new American rules have started to take effect, and it turns out that some of the banks found a way around the guidance issued in July by the Commodity Futures Trading Commission, which regulates most of the American swaps market.
Livevol Names New CEO
Press Release (Livevol)
Catherine Clay is the new CEO of Livevol, Inc., the leader in equity and index-options technology and services. Clay, who was previously the company’s chief strategy officer, will lead the company’s strategic initiatives for its options-analytics, market-data and brokerage businesses.