John Lothian Newsletter: City hiring grinds to a halt as Brexit poll looms; Why the S.E.C. Didn’t Hit Goldman Sachs Harder; Senators back study of contested stock exchange pricing model

Apr 25, 2016

First Read

Mary Ann Burns: A Thirst for the Futures Industry and a Crafty Career
John Lothian – JLN
Mary Ann Burns is leaving the Futures Industry Association and the industry. That was the shocking news we heard a little over a week ago. After 23 years at the FIA, and 30 years developing the program for FIA Expo, this Terre Haute, IN native is moving on to an even craftier career.

Mary Ann Burns

Burns’ thirst for the next phase of her career has her leaving the FIA to help run a family-owned craft beer brewery – her family’s. Her son and husband started Old Ox Brewery several years ago. It is named for a picturesque road in Northern Virginia where oxen were used to pull goods to the river for sale.

She says the craft brewery space is very similar to the futures industry in the 1980s and 1990s, with lots of collaboration. In fact, she said that was her favorite part of the futures industry. “This has been the most amazing thing for me, the collaboration among the community,” she told me in a phone interview. “Everybody working together is what makes it special.”

For the rest of the story about Mary Ann Burns, go here

***** I tried to write this story in a WSJ-esque style from the 1980s when the Wall Street Journal would have in-depth stories on their front page that would meander through the back pages of the paper. It seemed a fitting style to write about Mary Ann Burns.

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China stock market: the 29 minutes that shook the world
Tom Mitchell in Beijing – FT
The 29 minutes that shook the world began on Thursday, January 7 at 9.30am Chinese local time when markets opened. At 9.42am, a sharp fall on the Shanghai and Shenzhen stock exchanges triggered a controversial new “circuit breaker” that halts trading for 15 minutes after a 5 per cent decline and closes the markets for the day after the blue-chip CSI 300 index is off 7 per cent.
goo.gl/YzXUT8

***** I am going to wait for the movie version of this.

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Is Your Broker Good or Bad?; In the age of Big Data, it’s time to liberate the BrokerCheck files
By JASON ZWEIG – WSJ
Most people expect the food in a three-star restaurant to be tastier than one-star grub and a two-thumbs-up movie to be better than a flick that got a solitary upward-pointing thumb. Good luck, however, finding a handy way to rank stockbrokers.
goo.gl/OauX4y

***** Good or bad at what?

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Goldman Sachs opens to the masses
Ben McLannahan in New York – FT
For almost 150 years Goldman Sachs has been the go-to bank of the rich and powerful. But now the Wall Street titan is opening up to the masses on Main Street by offering online savings accounts for as little as $1 on deposit.
goo.gl/OVyYyg

***** You will note the headline does not say “unwashed masses.” You still have to bathe before logging onto your online GS account.

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Bill Herder Goes for Bare-Legged Fundraising; Kilt Challenge Passed to Herder from Simon Puleston Jones
For the past few years, a figurehead from within the industry has braved going bare-legged in a kilt at the FIA IDX Gala Dinner in return for donations to Futures for Kids. Over the years, the Gala Dinner and the Kilt Challenge has raised over £1 million for Futures for Kids. FIA’s Head of Europe, Simon Puleston Jones raised nearly £5,000 at the 2015 IDX Gala and has passed on the sporran to FIA’s Head of Asia-Pacific Bill Herder for 2016. Could you please help Bill brave an evening in kilt and sporran, and support his goal of £10,000 in donations for Futures for Kids by adding this to your newsletter?
More information on Bill’s Kilt Challenge can be found here
***** Who are you calling a figurehead?

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Community Outreach
CME Group
CME Group believes that part of being a good corporate citizen means giving back to our community. To support this commitment, the Amicus Community Outreach Program was founded in 1994 by retired Chairman of the Board Jack Sandner.
Amicus, which means friendship in Latin, offers employees and members of our exchange community the opportunity to volunteer their time to advance education, provide needed resources for the underprivileged, and enrich lives by providing a human touch to those in need.
goo.gl/8g4ed8

***** CME is getting their corporate citizenship message out.

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Friday’s Top Three – Scandal Wins Out
Friday’s top clicked story was Matt Leising’s Bloomberg story “Spoofing Cases From Oystacher’s Past Prove Intent, CFTC Says. Apparently, history is a guide. Coming in second, also from Bloomberg, is Singapore Raids Brokers; Exchange Reports Irregularities. Rounding out the top three was the FT expose Golf, lapdancing — there’s far too much fun in fund management

GMI-Blockchain Conference
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Bridging the Week by Gary DeWaal: April 18 – 22 and 25, 2016 (SEF Claims Foul; Compensation Deferrals and Claw-Backs; Financial Stability)
by Gary DeWaal, Katten Muchin Rosenman LLP
A swap execution facility sued multiple interest rate swap dealers and other entities claiming they colluded to prevent its success. In addition, six federal agencies proposed compensation rules that might result in more of the largest financial institutions’ senior officers’ (including, potentially, chief compliance and chief legal officers’) and substantial risk takers’ incentive bonuses being subject to deferral for four years, as well as previously paid bonuses being subject to claw-back for up to seven years.
goo.gl/FqyKzn

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Lead Stories

City hiring grinds to a halt as Brexit poll looms
Harriet Agnew, City Correspondent – FT
It is a familiar ritual that takes place every spring. Across the City, employees from top rainmakers to ambitious young bankers wait for their bonus to hit their bank account before resigning to join a rival. The mass migration forms part of a merry-go-round of hiring that happens each year. Only this year it is different.
goo.gl/DPGYVX

This darned Brexit vote seems to be fouling up everything
JEREMY WARNER – Telegraph
With Britain’s EU referendum now just two months off, deal activity in the City has ground to a virtual standstill. It may be advisable to take an early holiday, for nobody is going to sign off on almost anything until the outcome is known.
goo.gl/wlLepk

Why the S.E.C. Didn’t Hit Goldman Sachs Harder
BY JESSE EISINGER – New Yorker
In the late summer of 2009, lawyers at the Securities and Exchange Commission were preparing to bring charges in what they expected would be their first big crackdown coming out of the financial crisis. The investigators had been looking into Goldman Sachs’s mortgage-securities business, and were preparing to take on the bank over a complex deal, known as Abacus, that it had arranged with a hedge fund. They believed that Goldman had committed securities violations in developing Abacus, and were ready to charge the firm.
goo.gl/qOsbOk

KCG CEO: Headcount will not go above 950; Following the sale of KCG’s DMM business, CEO at KCG said he expects headcount will not go above 950 again.
By Hayley McDowell – The Trade
Daniel Coleman, KCG’s chief executive officer, has said in its first quarter earnings call that headcount at the firm will not go back above 950.
goo.gl/Qq5fkk

Senators back study of contested stock exchange pricing model
By John McCrank – Reuters
The U.S. Securities and Exchange Commission has been too slow to act on stock market reforms and should quickly move forward with a temporary trial to test the effects of a contentious pricing model used by exchanges, two U.S. senators said on Friday.
goo.gl/J7yTA7

Quick View: Bats follows exchange playbook with data push
Philip Stafford – FT
Bats Global Markets has banished memories of its ill-fated IPO four years ago. Now investors have to weigh up what the investment case is.
goo.gl/2oOekw

Hong Kong Rejoins Developed Market Bourses With Closing Auction
Eduard Gismatullin – FT
New price-setting session to deter manipulation, HKEx says; SocGen says closing may account for 15% of daily turnover
Hong Kong is going to rejoin its developed market peers when it reintroduces a stock-market closing auction after a seven-year gap.
goo.gl/4kO1iX

Bond trading must adapt to survive, says ICMA
By Hayley McDowell – The Trade
A new report authored by the International Capital Market Association (ICMA) states bond trading must adapt and innovate in order to survive.
goo.gl/fb5oZd

The Lessons of Our Bond War; After years of avoiding its obligations, Argentina made a deal with my firm and others that sends a good message on lending.
By PAUL SINGER – WSJ
On April 22, a unique chapter in the history of the international bond market drew to a close when the Republic of Argentina settled with the largest remaining holders of the bonds unresolved from its 2001 default on more than $80 billion. Elliott Management, the firm I founded and manage, was one of these holders, having purchased bonds both before and after the default.
goo.gl/Nzyklp

UK banks set for grim results showing size of turnaround task
BY LAWRENCE WHITE AND ANDREW MACASKILL – Reuters
Britain’s top banks are set for one of their worst first-quarter earnings seasons since the financial crisis, adding to their struggle to win over investors against a backdrop of misconduct charges, a weak economic outlook and uncertainty over Brexit.
goo.gl/FCgfn3

New tax rules for large European funds
Attracta Mooney and Chris Flood – FT
Europe’s largest asset managers will be forced to publicly disclose additional information about their tax affairs for the first time under new rules put forward by the EU earlier this month.
goo.gl/YQBBIV

U.S. Regulators to Propose New Liquidity Demand for Big Banks
Jesse Hamilton – Bloomberg
Rule would require lenders have long-term sources of funding; Net Stable Funding Ratio is second part of liquidity controls
U.S. bank regulators are set to propose the second of two major demands on the amount of liquidity lenders need to have on hand to keep running through tough times.
goo.gl/8n9GTv

Regulatory

CFTC automated trading proposal worries energy firms; Companies surprised to learn they may need to register as algorithmic traders
Elizabeth Blosfield – Risk.net (Subscription Required)
As the US Commodity Futures Trading Commission (CFTC) moves to regulate algorithmic trading, energy companies have discovered to their surprise that they may fall within the scope of the CFTC’s proposed rule, due to language that appears to cover popular tools for accessing oil, gas and power markets. The CFTC’s proposal, called Regulation AT, would require algorithmic trading firms to register with the commission, implement pre-trade risk controls and comply with various standards for the development,…
goo.gl/lSjTPl

Data is key hurdle in Mifid preparation – panel
Futures & Options World
The lack of clarity around some of the technical requirements under impending regulatory game-changer Mifid II is causing internal challenges for banks, market experts have warned, as the lack of clarity on data definitions remains a key stumbling block.
goo.gl/oLrDkp

Financial integration in Europe 2016
European Central Bank
Overall assessment of financial integration
Overall, financial integration in the euro area has continued to recover since last year’s report, although lately at a moderating pace.
goo.gl/EfcElr

**ECB’s annual report on financial integration

ECB is having second thoughts on ‘coco’ bonds
Martin Arnold and Thomas Hale in London – FT
The European Central Bank is having second thoughts about the hybrid securities known as “cocos” that are designed to bolster the capital of banks but caused panic among investors this year.
goo.gl/sXvchM

Ex-FCA regulator joins Alpha FMC to head up compliance unit; Andrew Glessing has been appointed as director and head of compliance practice at consultancy firm, Alpha FMC.
By Hayley McDowell – The Trade
Alpha FMC has announced the launch of a dedicated compliance practice which will be led by ex-Financial Conduct Authority (FCA) regulator, Andrew Glessing.
goo.gl/sYGI2Z

Securities brokers: SECP to introduce new regulatory regime
brecorder.com
The Securities and Exchange Commission of Pakistan (SECP) will introduce a new regulatory regime for securities brokers operating in the capital market focusing on minimum entry standards, criteria for sponsors, directors and employees, corporate governance, risk-based capital adequacy and regular audits.
goo.gl/i5sRAD

Banks hope for reprieve on Mifid II bond rules
By Tim Cave – Financial News
European banks are hoping that regulators will change key aspects of rules designed to bring more transparency to over-the-counter bond markets, which are expected to be finalised in the coming weeks.
goo.gl/rzI6e2

Fund houses favour rivals at annual general meetings
Madison Marriage – FT
The Financial Conduct Authority has been alerted to serious problems regarding the way fund managers vote at the companies they are invested in, as part of the UK regulator’s investigation of the asset management market.
goo.gl/Ama0Re

FIA Says CFTC Automated Trading Proposal Should Protect Source Code
Cadwalader
The Futures Industry Association (“FIA”) Principal Traders Group (“PTG”) urged the CFTC to “protect innovation in markets” by requiring limited access to algorithmic source code in its Regulation Automated Trading proposal.
/goo.gl/thnuSh

Protect source code to protect innovation in markets
FIA Principal Traders Group
In our last piece on the CFTC’s proposed rules on automated trading, we explained why the Commission should focus only on risk controls in its first rulemaking on this topic.
/goo.gl/18surP

Exchanges & Trading Facilities

Gonzalo Cuadra to chair LME User Committee
LME
The London Metal Exchange (LME) is pleased to announce the appointment of Gonzalo Cuadra as chairman of the LME User Committee. Mr Cuadra is CEO of Chile Copper Limited and Managing Director of Codelco Services Limited.
goo.gl/ZYcCPN

SGX partners China Construction Bank to promote Singapore’s capital markets
SGX
Singapore Exchange (SGX) and China Construction Bank (CCB) today signed a memorandum of understanding (MOU) to promote Singapore’s capital markets to Chinese companies.
goo.gl/sE8XPk

HKEX Rolls Out Risk Management System for its Derivatives Market
HKEx
Hong Kong Exchanges and Clearing Limited (HKEX) today (Monday) announced the successful launch of its Pre-Trade Risk Management (PTRM) system, a system that offers tools to help Participants in its derivatives market meet their needs for pre-trade controls while complementing their in-house risk controls.
goo.gl/xOQQGQ

Gonzalo Cuadra To Chair LME User Committee
Mondovisione
The London Metal Exchange (LME) is pleased to announce the appointment of Gonzalo Cuadra as chairman of the LME User Committee. Mr Cuadra is CEO of Chile Copper Limited and Managing Director of Codelco Services Limited.
goo.gl/hz5Xw2

Bursa Malaysia Registers Profit After Tax And Minority Interest Of Rm49.9 Million In First Quarter Of 2016
Mondovisione
Key Financial & Market Highlights (1Q2016 vs 1Q2015)
goo.gl/7rWpmK

Dubai Sukuk Listings Reach USD 42.61 Billion As Emirate Underlines Leadership In Sector
Mondovisione
Khaled Al Aboodi, Chief Executive Officer of Islamic Corporation for the Development of the Private Sector (ICD), today rang the market-opening bell to celebrate the listing of a 300 million US dollar Sukuk on Nasdaq Dubai.
goo.gl/fmjKBd

Taiwan Stock Exchange & Cathay Securities Corp. Promotes Growing Electric Vehicle Industry To Foreign Investors – Foreign Investors Now Make Up Almost 30% Of Trading In Taiwan’s Rapidly Internationalizing Capital Market, Attracted To High-Growth Sectors
Mondovisione
The Taiwan Stock Exchange (TWSE) and Cathay Securities Corporation today jointly held the ‘Electric Vehicle Forum’ in Taiwan. The forum bought together TWSE-listed electric vehicle suppliers with leading institutional investors from across the Asia-Pacific looking to benefit from another of Taiwan’s fast-growing technology sectors.
goo.gl/avPuOe

Politics

How Politics Influences the Stock Market: Not Very Much
Peter Eavis – NY Times
Before long, someone is going to call this the Hillary rally.
As the chances of Mrs. Clinton’s nomination have strengthened, the Dow Jones industrial average has soared, rising 2,344 points, or 15 percent, from its recent low on Feb. 11.
goo.gl/jv6zbY

Hedge Funds & Managed Futures

It’s Dangerous Out There in the Bond Market
Anchalee Worrachate, Anooja Debnath – Bloomberg
Investors face damaging losses if yields rise even a little; A half-percentage point increase would wipe out $1.6 trillion
Bond investors are taking bigger risks than ever before. Yields on $7.8 trillion of government bonds have been driven below zero by worries over global growth, meaning money managers looking for income are pouring into debt with maturities of as long as 100 years. Central banks’ policy is exacerbating matters, as the unprecedented debt purchases to spur their economies have soaked up supply and left would-be buyers with few options.
goo.gl/1LRPQj

Is there a new Plaza Accord?
Gavyn Davies – FT
Foreign exchange traders are buzzing with talk of a new “Plaza Accord”, following the marked change in the behaviour of the major currencies after the Shanghai G20 meetings in late February.
goo.gl/d2nk04

Bad Active Management Can’t Survive the Internet
by Joshua M Brown – The Reformed Broker
Your favorite stock; see if it’s a buy, sell or hold opportunity
Before we get started, let me state for the record that I am not anti-active management.
goo.gl/PKCZ09

Warren Buffett’s Former Heir-Apparent Resurfaces as Activist Investor; Ex-Berkshire executive David Sokol is pushing Middleburg Financial to put itself up for sale
By SERENA NG And ANUPREETA DAS – WSJ
A former heir apparent to billionaire investor Warren Buffett has resurfaced in an unusual role—as an activist agitating for the sale of a small Virginia bank.
goo.gl/YyM8vp

Investors are fleeing hedge funds in droves
Wolf Richter – Business Insider
Big public pension funds are slow-moving apparatuses. So dramatic shifts in investment decisions take a long time to be discussed and decided, and even longer before they’re felt by the investment community. But now they’re being felt – painfully.
goo.gl/FZdDCO

Markets too quick to dismiss effects of Japan’s negative rates
Leo Lewis in Tokyo – FT
Markets have been too quick to write off negative interest rates, according to the head of one of Japan’s largest investment banks — a group that has suffered the most from the falling cost of borrowing.
goo.gl/efQeGf

Too much company information makes finance hard to grasp
Simon Samuels – FT
Accountants and banks should not be shy about binning useless stuff, writes Simon Samuels
As all good golfers know, less is often more. Might the same be true when it comes to financial reporting? The page count inflation of company reporting over the past two decades has been staggering. Back in the mid-1990s the typical report and account was fewer than 100 pages; this spring’s annual report season saw most major companies publish weighty tomes, often more than 250 pages.
goo.gl/WD4B8U

Asset managers discount fees for big investors by a third
Attracta Mooney – FT
Asset managers are discounting the fees they charge big investors by up to a third in a bid to gather assets at a time when regulation and competition among fund houses are making it harder to win and retain business.
goo.gl/PlUkjE

Banks & Brokers

Too Big to Fail? So What, Say Bank Depositors; The biggest U.S. banks continued to gain deposits in the first quarter
By AARON BACK – WSJ
Plenty of people say they don’t like too-big-to-fail banks. Yet plenty of people are still happy to give those same banks their money—even when it earns them next to nothing.
goo.gl/N4gnWS

Bank of America Merrill Lynch rings the changes in M&A
By Lucy Burton – Financial News
Bank of America Merrill Lynch has handed its head of mergers and acquisitions in Europe, the Middle East and Africa a new role overseeing investment banking across the region, in a move that brings its leadership set-up in Europe in line with the business’s global structure.
goo.gl/6KlNZW

Banks to ramp up credit risk if Basel scraps internal models; Lobbyists warn banks will add more high-yield debt if forced to follow standardised approach
Peter Madigan – Risk.net
Proposals to drastically limit banks’ ability to use internal risk-based models to calculate credit risk capital will encourage lending to less creditworthy counterparties, trade associations have warned. This would have the perverse result of increasing the amount of credit risk on their balance sheets. In its March 24 consultation, the Basel Committee on Banking Supervision proposed to strip away from banks the option to use the internal ratings based (IRB) approaches to determining their capital…
goo.gl/Fpb5Tq

Clearing & Settlement

Clearing houses asked to draw up Brexit recovery plans
By Tim Cave – Financial News
The Bank of England has called on London’s clearing houses to draw up contingency plans on how they would cope in the event of a UK exit from the European Union.
goo.gl/2dCWRU

ESMA OKs exemption of Danish schemes from EMIR clearing duty
IPE
The European Securities and Markets Authority (ESMA) has backed the Danish financial regulator Finanstilsynet, saying three unnamed Danish pension schemes should be exempt from the obligation to centrally clear OTC derivatives contracts under the European Market Infrastructure Regulation (EMIR).
goo.gl/7JgTWN

Winterflood to use BNY Mellon clearing solution
IBS Intelligence
BNY Mellon has been appointed by Winterflood Securities to provide US DTCC and Canadian securities clearing and custody services. Simon Rafferty, Chief Operating Officer at Winterflood Securities, says: “BNY Mellon impressed us with its experience and knowledge of the North American securities market and its prominence as a leading custody and clearing provider was an important factor in our decision.
/goo.gl/TcBJ0I

Schrödinger’s Clearinghouse?
Streetwise Professor
Three weeks ago I wrote about, and criticized, LSE CEO Xavier Rolet’s statement that “We can cross margin our over-the-counter clearing with their listed derivatives without merging the clearinghouses, and without comingling the risk-management framework. [Emphasis added.]” Then three days ago I read Philip Stafford’s article in the FT stating “Deutsche Börse and LSE plan to link clearing houses”:
goo.gl/YKUFBK

Blockchain about to get interesting as trial phases end – Euroclear; Euroclear believes questions surrounding Blockchain will begin to be answered as real solutions using the technology begin to be rolled out.
By Paul Walsh – The Trade
There will be a greater understanding of blockchain technology and its impact as it finishes its trial stages according to the director of product strategy and innovation at Euroclear.
goo.gl/0l9rDp

Indexes & Products

Overpriced Index Funds Won’t Go Away
By Barry Ritholtz – Bloomberg View
Many traders and investors acts as if markets are efficient, meaning that asset prices fully reflect all available information. We see this manifest itself in numerous ways — how prices rapidly adjust to new information and how few investors manage to beat the broader indexes by picking stocks or trying to time the market.
goo.gl/aRykT3

Smart-Beta War Rages On as Cliff Asness Slams Pimco Star’s Paper
Bloomberg
Trying to time the market is a dumb idea.
That in a nutshell is Cliff Asness’s opening salvo into an escalating war of words over smart-beta exchange-traded funds, triggered in February when one of the inventors of the approach said many had become too expensive. Asness, co-founder of AQR Capital Management, joins other theoreticians jumping in the fray, which goes to the heart of a strategy that bridges active and passive management.
goo.gl/mcIbCt

Will Smart Beta Be the Next Industry Disruption?
CFA Institute
Smart-beta flows have been growing and are drawing industry attention. At one extreme, practitioners profess that smart-beta strategies could disrupt the investment management industry. On the other extreme, early adopters have cautioned against chasing performance and highlight how some of these strategies can “go horribly wrong.” How has smart beta evolved, and are these claims realistic?
/goo.gl/e5vFDu

How to Build Smart Beta 2.0
Chief Investment Officer
Concentrated or “targeted” smart beta funds will be the next wave of indexing, according to Morningstar’s Vice President of Research John Rekenthaler.
“Targeting can be thought of as tilting, tilted again.”Just as smart beta strategies sought to replace replicating indexes by “tilting” to a certain factor, targeted funds with conviction are likely to deliver outperformance and appeal to investors who value “indexing’s virtues,” the columnist wrote.
goo.gl/fUJTHO

Technology

Blockchain about to get interesting as trial phases end
Euroclear
There will be a greater understanding of blockchain technology and its impact as it finishes its trial stages according to the director of product strategy and innovation at Euroclear. Speaking at a SWIFT business forum in London, Angus Scott highlighted how questions raised about distributed ledger technology would be known as it nears the end of the experimentation phase.
goo.gl/0l9rDp

GlobalView Preps Excel-Like ‘CurveBuilder’; The platform offers an “Excel-like” interface for those used to pricing energy and commodities contracts using spreadsheets.
Faye Kilburn – Waters Technology
Chicago-based energy data management provider GlobalView is preparing to launch a new tool next month, dubbed MarketView CurveBuilder, to help traders, analysts and risk managers automate the process of creating, testing and visualizing forward curves.
goo.gl/lGUANE

TradingScreen Wins WatersTechnology Best Sell-Side Technology Award; Sell-Side Technology Award for Best OTC Initiative
TradingScreen
TradingScreen, the leading independent provider of liquidity, trading, and investment technology via SaaS, has won the WatersTechnology Sell-Side Technology Award for Best Sell-Side OTC Trading Initiative. WatersTechnology Sell-Side Technology Awards recognize the leading technologies, through an auditable and transparent methodology underpinned by the input and experience of judges.
goo.gl/LguGsu

Philips ‘More Likely’ to Pursue I.P.O. of Lighting Business
By CHAD BRAY – WSJ
Philips, the Dutch electronics giant, said on Monday that it was “more likely” that the company would pursue an initial public offering, rather than a private sale, of its lighting business.
goo.gl/0S9hij

***** Phillips was a supporter of the Intellectual Property Exchange before it closed. Had it survived and thrived, they may not have had to have an IPO for lighting.

Europe should forget Google and investigate its own shortcomings
Michael Moritz – FT
It should ask why its biggest names are worth a fraction of those in the US, writes Michael Moritz
Imagine if, over the next 60 days, the European Commission staged a series of press conferences and bombarded journalists with a battery of announcements of pocket-sized investigations into the condition of the continent’s technology industry.
goo.gl/H8xApB

Enforcement

Japan’s Financial Services Agency: Administrative Action Against Credit Suisse Securities (Japan) Limited
Mondovisione
The Securities and Exchange Surveillance Commission (SESC) conducted an inspection on Credit Suisse Securities(Japan)Limited (hereinafter referred to as “the Company”), and found violations of the Financial Instruments and Exchange Act (hereinafter referred to as ”FIEA”). On April 15, 2016, the SESC recommended that the Financial Services Agency (FSA) should take an administrative action against the Company.
goo.gl/lGX506

Ex-UBS Trader in ‘Cartel’ Said to Help U.S. in Currency Probe
Tom Schoenberg, David McLaughlin, Suzi Ring – Bloomberg
Gardiner said to be cooperating with Justice Department; Cases against individuals seen coming as soon as this summer
A currency trader from the Cartel chatroom — the instant-messaging group the U.S. government named in wringing guilty pleas from five global banks — has been helping prosecutors who are trying to build foreign-exchange manipulation cases against individuals, according to two people familiar with the matter.
goo.gl/R4JXvD

Justice Department weighs charges against London forex traders
Caroline Binham in London – FT
US authorities are weighing whether to bring charges against London-based traders caught up in the global foreign-exchange rigging scandal, leaving the potential for drawn-out transatlantic criminal proceedings even after UK authorities have dropped a parallel investigation against them.
goo.gl/TNAmGa

Environmental & Energy

The Rise and Deadly Fall of Islamic State’s Oil Tycoon; A document trove tells how Abu Sayyaf ran the terror group’s operations; approving expenses for slaves, dodging U.S. airstrikes
By BENOIT FAUCON and MARGARET COKER – WSJ
Islamic State oil man Abu Sayyaf was riding high a year ago. With little industry experience, he had built a network of traders and wholesalers of Syrian oil that at one point helped triple energy revenues for his terrorist bosses.
goo.gl/QI6gHi

Next oil downturn? Looming gasoline glut threatens crude’s rebound
BY HENNING GLOYSTEIN AND FLORENCE TAN – Reuters
A rebound in oil prices this year from 12-year lows is in danger of coming to a crashing halt, as the main engine of global demand growth for the past several years starts to sputter amid signs of a gasoline glut.
goo.gl/z3Uv7q

Car emissions scandal exposes crippling compromises behind rules
Jonathan Ford – FT
Banking isn’t the only industry where the gaming of regulations can seem to be a pretty standard business practice. When it comes to cunning tweaks and work-rounds, the world’s biggest carmakers are not far behind.
goo.gl/iHTNHH

Nations sign landmark agreement on climate change
By FARNAZ FASSIHI – MarketWatch
World leaders gathered at the United Nations on Friday to sign a landmark agreement on climate change, setting in motion a process to curb the impact of global warming.
goo.gl/PwR7CJ

EEX: Daily Volume On The Power Derivatives Market Exceeds 30 TWh For The First Time
Mondovisione
On 21 April, trading volumes on the EEX power derivatives market amounted to 30,221,161 MWh. Therefore, for the first time, more than 30 TWh were traded on one day. The German market (Phelix) contributed 18.9 TWh to the total volume. The previous record was achieved on 21 January 2016 with a volume of 27,136,561 MWh.
goo.gl/dsWV8Z

Asia-Pacific

Hong Kong rejoins developed market bourses with closing auction, Banking & Finance
THE BUSINESS TIMES
Hong Kong is going to rejoin its developed market peers when it reintroduces a stock-market closing auction after a seven-year gap.
goo.gl/MRf9Cq

Use us to tap China market: Hong Kong to India Inc
The Indian Express
Indian companies looking to secure a foothold in the East Asian marketplace and as a springboard to mainland China have great potential by routing their investments and projects through Hong Kong, senior government officials said.
goo.gl/kQl8ik

The Tokyo Whale Is Quietly Buying Up Huge Stakes in Japan Inc.
Yuji Nakamura, Anna Katakana, Nao Sano
BOJ is an estimated top 10 owner in about 90% of Nikkei 225; Central bank seen boosting ETF purchases as soon as this week
They may not realize it yet, but Japan Inc.’s executives are increasingly working for a shareholder unlike any other: the nation’s money-printing central bank.
goo.gl/8O9CWE

FIA Announces New Members Of Asia Advisory Board
Mondovisione
FIA announced the appointment of seven new members to its Asia Advisory Board:
Peter Jaeger, Citi
Helen Lofthouse, ASX Ltd.
Ady Ng, UOB Bullion and Futures Ltd.
Kevin Rideout, Hong Kong Exchange and Clearing Ltd.
Neil Salter, Credit Suisse
James Shekerdemian, Societe Generale
Sharon Shi Ning, G.H. Financials (Hong Kong) Ltd.
The new members bring the total membership of the Asia Advisory Board to thirteen.
goo.gl/P2y0Se

China’s commodities rebound: it’s for real
Rafael Halpin – FT
Investors are wrong to expect a linear decline in China’s need for raw materials
Recent signs of a revival in Chinese demand for commodities such as iron ore have been met with scepticism. But there may be stronger grounds for optimism than many think, according to analysis by FT Confidential Research, a unit of the Financial Times.
goo.gl/dc5yUD

Frontier Markets

Barclays ex-CEO Bob Diamond eyes bid for Africa unit with Carlyle -source
Reuters
Former Barclays Chief Executive Bob Diamond is teaming up with private equity group Carlyle to prepare a bid to buy the bank’s African operations, a source familiar with the matter told Reuters on Monday.
goo.gl/xtMEg0

BSE to auction investment limits for Rs 4,818-cr govt bonds; The auction will be conducted on BSE’s e-bidxchange platform
Business Standard
Leading bourse BSE will tomorrow auction investment limits for overseas investors for the purchase of government debt securities worth Rs 4,818 crore.
goo.gl/NhKtAU

Sebi mulls entry of banks, MFs in commodity markets
The market regulator is contemplating all possible ways to integrate commodity
Shrimi Choudhary – Business Standard
The Securities and Exchange Board of India (Sebi) might allow new participants such as banks, mutual funds and foreign portfolio investors in the commodity market.
goo.gl/3BqRMS

Miscellaneous

The revenge of globalisation’s losers
Wolfgang Munchau – FT
Its failure in the west is down to democracies’ inability to cope with the economic shocks
Globalisation is failing in advanced western countries, where a process once hailed for delivering universal benefit now faces a political backlash. Why? The establishment view, in Europe at least, is that states have neglected to forge the economic reforms necessary to make us more competitive globally.
goo.gl/ipgOWa

In an Age of Privilege, Not Everyone Is in the Same Boat; Companies are becoming adept at identifying wealthy customers and marketing to them, creating a money-based caste system.
By NELSON D. SCHWARTZ – NY Times
Behind a locked door aboard Norwegian Cruise Line’s newest ship is a world most of the vessel’s 4,200 passengers will never see. And that is exactly the point.
goo.gl/ZaaoR3

New York Times plans to cut hundreds of jobs later this year
By Claire Atkinson – NY Post
The New York Times Co. is preparing to lay off a few hundred staffers in the second half of the year, The Post has learned.
goo.gl/rm2rdX

Rich People Are Living Longer. That’s Tilting Social Security in Their Favor.
By NEIL IRWIN – Ampproject.org
Social Security is designed to ensure that no workers go penniless in old age and also as an equalizer between rich and poor. It is structured to give more generous retirement benefits to low-income people, given the taxes they pay during their working years.
/goo.gl/kVZc32

A Bright Side to the Financial Stumbles of Digital Media
Peter Eavis – NY Times
People who don’t work in the news media might not have noticed the outbreak of angst that followed the recent financial stumbles at young publications like BuzzFeed and Mashable.
goo.gl/Aobvlk

Here’s how the first movie about what it’s like to be a woman on Wall Street got made
Jason Guerrasio – Business Insider
The financial world has been explored on the big screen from Gordon Gekko’s greed in “Wall Street” to the housing market bust in “The Big Short,” but a movie has never looked at this cutthroat world from a female perspective — until now.
goo.gl/Cnnpph

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