Hits & Takes
By John Lothian & JLN Staff
The FIA has released their midyear advocacy report that shows the amount of work the FIA has done during the pandemic from laundry rooms and other venues. Walt Lukken in particular was known for pressing issues with lawmakers and regulators while ironing his pants.
You should also check out Walt Lukken’s message in the latest article in Viewpoint that discusses the value of virtual. We are all having to adjust to working in a virtual environment in many aspects of our life, including meeting with customers and prospects virtually instead of in person at the popular FIA conferences. It would be nice to be able to get together in person again, but in the meantime we need to make the most of virtual connections to stay safe and prosper.
Eurex’s EnLight platform has reached a new milestone; 3 million contracts have been traded on the #RFQ platform since it launched in March of 2018.
Eurex is seeing more activity in their ETF options, with the iShares Physical Gold contracts (IGLN) volume from July 2019 to July 2020 more than tripling. Around 40% of the volume was traded in 2020.
Here is a piece about hedging with Ameribor on Derivative Path to which AFX contributed.
Ashish Chauhan, the CEO of BSE (Bombay Stock Exchange, India), reported on Twitter that the signage on top of the BSE building toppled due to very heavy wind and incessant rain today.
Bloomberg has a story by Conor Sen about how “Virtual Work Strengthens the Outsiders and the Weak.” It is an interesting look at how the pandemic and work from home is changing company dynamics.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
CFTC Advisory Warns Customers to Carefully Assess Precious Metals Pitches Touting CARES Act Rules
The Commodity Futures Trading Commission today issued a Customer Advisory educating the public about unregistered gold and silver dealers advising investors to use relaxed rules under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to purchase precious metals. This Customer Advisory— the fourth issued by the CFTC in response to the COVID-19 (coronavirus) pandemic— was prepared by the Office of Customer Education and Outreach (OCEO).
***** I have asked the team to produce a short animated video about this issue. I hope the CFTC will share it on social media. Stay tuned.~JJL
Some People Made Money on Negative Oil Prices; Also TikTok key money, green structured notes and alternative data.
Matt Levine – Bloomberg
At 2:30 p.m. New York time on Monday, April 20, the May West Texas Intermediate crude oil futures contract closed at negative $37.63 per barrel. That was weird! We talked about it a lot, trying to piece together explanations for why a commodity that has essentially always traded at a positive price spent one day at an extremely negative price.
*****Interesting question of when is something prehedging and when is some trading banging the close?~JJL
The Strain the Covid Pandemic Is Putting on Marriages; Coronavirus stress has produced a pressure cooker inside homes, hurting even strong partnerships and, experts say, likely breaking others
Anne Marie Chaker – WSJ
For Kristin and Ilya Shapiro, the Covid pandemic has created new tensions. Lately, the spouses have argued about Mr. Shapiro’s travel schedule: Ms. Shapiro doesn’t like that it creates child-care headaches. But Mr. Shapiro says it’s important to his work as a Washington, D.C., think tank director, and offers emotional respite too.
***** Go for a walk. Adopt a dog. Get a bike. Find a way to get out of the house, but stay safe.~JJL
WNBA players wear ‘Vote Warnock’ shirts in continued stand against Kelly Loeffler
Rob Schaefer – NBC Sports
WNBA players wear ‘Vote Warnock’ shirts in continued stand against Kelly Loeffler
In a show of support to Raphael Warnock, a Democratic challenger for Kelly Loeffler’s (R) Senate seat in Georgia, players across the WNBA donned T-shirts that read “Vote Warnock” Tuesday afternoon.
***** What a stinky way to make a statement.~JJL
Sen. Kelly Loeffler blasts players on her WNBA team for supporting challenger
Kenneth Garger – NY Post
WNBA players on the Atlanta Dream squad, which is co-owned by Sen. Kelly Loeffler, showed up to their Tuesday game wearing t-shirts promoting the Georgia lawmaker’s Democratic challenger.
***** The Dream is no longer a dream but a nightmare for Sen. Loeffler.~JJL
The Fed is expected to make a major commitment to ramping up inflation soon
Jeff Cox – CNBC
In the next few months, the Federal Reserve will be solidifying a policy outline that would commit it to low rates for years as it pursues an agenda of higher inflation and a return to the full employment picture that vanished as the coronavirus pandemic hit.
****If they do this it is worth noting that It’s been a record 11 years since the last increase in the U.S. minimum wage. ~JB
Tuesday’s Top Three
Our top story Tuesday was London Traders Hit $500 Million Jackpot When Oil Went Negative, from Bloomberg. Second was a repeat of Monday’s top story, CME to pay $3.5m over leak of secret trade data, from the Financial Times. Third was the Wall Street Journal’s Coffee Drinkers Stay Home, Hitting Some Beans Harder Than Others. I miss cafes and diners and that marvelous American invention, the bottomless cup of coffee. But I’m drinking my 100% Arabica coffee at home.
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Kodak Loan Disclosure and Stock Surge Under SEC Investigation; Probe focuses on reporting of $765 million government loan to company and granting of stock options
Dave Michaels and Theo Francis – WSJ
The Securities and Exchange Commission is investigating the circumstances around Eastman Kodak Co. ‘s announcement of a $765 million government loan to make drugs at its U.S. factories, according to people familiar with the matter. News of the loan last week caused Kodak’s shares to rise as high as $60, before falling to about $15 on Monday due to a dilution in the shares. Amid the heightened volatility, trading volume has surged. The price spike briefly produced a potential windfall for company executives who owned stock-option grants, some of which were granted on July 27, the day before the loan was officially announced.
ETF joins world’s biggest gold owners as investors flock in; State Street fund holds more of the precious metal than some central banks as price passes $2,000
Robin Wigglesworth – FT
An exchange traded fund has become one of the world’s biggest owners of gold, surpassing even the central banks of Japan and India, as investors have scrambled to buy the precious metal and pushed it to record highs.
Beirut explosion: Lebanon death toll climbs to 100 as day of mourning begins; Country declares a ‘disaster zone’ after explosion rips through Beirut
Chloe Cornish – FT
The death toll from the explosion that ripped through Beirut climbed to at least 100 on Wednesday, while some 4,000 people were wounded in the massive blast at the city’s port.
Older Investors Go for Gold, Younger Ones Bitcoin, JPMorgan Says
Joanna Ossinger – Bloomberg
Strategists say retail-investing jump masks generational split; Older people prefer bonds, millennials snap up tech stocks
The behavior of retail investors during the pandemic varies significantly across age groups, according to JPMorgan Chase & Co. Investors generally are interested in alternative assets but older ones are buying gold while younger ones like Bitcoin, strategists led by Nikolaos Panigirtzoglou said. Millennials are embracing stocks, particularly technology shares, whereas older individuals are selling equities, they said.
Airlines Get Pushed to Brink Again With Virus Decimating Demand; Early signs of recovery have been stalled by Covid flareups during carriers’ prime season.
Christopher Jasper – Bloomberg
Just a month ago, airlines around the world began adding flights as national lockdowns eased and people craved an escape from hibernation. But as the travel season reaches what should be its annual peak, hopes for an industry rebound have been dashed by flareups of the pandemic in Asia, a deepening health crisis in the Americas, and the reimposition of flight curbs in Europe. As a result, the aviation world is becoming increasingly resigned to years of depressed demand as optimism about a quick rebound from the crisis is swept away.
The 880% Stock Rally That’s Trouncing Tesla and Everything Else
Yoolim Lee – Bloomberg
Sea Ltd. is surging as business booms during the pandemic; Bulls see a Tencent-Alibaba mash-up; bears see a bubble
It gets far less attention than Tesla, the FAANGs or even the Robinhood flavor of the week. Yet Sea Ltd. has quietly become the world’s best-performing large-cap stock, stoking a debate on Wall Street over whether the Singapore-based gaming, e-commerce and payments company is the next great internet colossus or just Exhibit A in a global tech bubble that’s destined to burst.
Cboe completes acquisition of dark pool MATCHNow from Virtu Financial; MATCHNow is one of Canada’s largest dark pools, providing Cboe with a path to build out an equities platform for Canadian markets.
Hayley McDowell – The Trade
Exchange operator Cboe Global Markets has confirmed it has completed its acquisition of the Toronto-based dark pool MATCHNow from Virtu financial. First announced in May, the deal for the alternative trading system (ATS) will provide Cboe with an expanded presence in Canada, and provide a path to build out a holistic equities platform for Canadian markets. Terms of the deal were not disclosed.
Shorter market hours bid hits wall as Euronext rejects proposal; Euronext confirms it has no intentions to change its market hours due to lack of consensus from market participants and little evidence on the benefits.
Hayley McDowell – The Trade
Pan-European exchange operator Euronext has said it has no intentions to modify the hours of its markets following an industry consultation on the proposal to reduce the trading day. The development will come as a blow to many market participants who have made the case that shorter market hours will boost intraday liquidity, drive diversity in the industry, and improve the wellbeing and mental health of traders.
CME Settles Lawsuit With Regulator Over Leaks by Former Employees; CFTC brought case against CME’s Nymex and two ex-employees over leaks of confidential trading information
Alexander Osipovich – WSJ
Futures-exchange operator CME CME 0.08% Group Inc. has agreed to pay a fine of up to $4 million to settle a long-running lawsuit with its regulator over accusations that former exchange employees leaked confidential trading information. The Commodity Futures Trading Commission brought the case in 2013 against a CME unit, the New York Mercantile Exchange, and two former employees of the unit, known as Nymex. The CFTC accused the former employees of disclosing private information on client activities to a commodities broker in return for meals and entertainment. The regulator later added the broker as a target of its civil lawsuit.
ETF backers declare victory after ‘largest ever stress test’; While some oil-focused funds suffered in the Covid sell-off, most came through in one piece
Robin Wigglesworth – FT
When Michael Burry, the doctor-turned-hedge fund manager immortalised in The Big Short for predicting the subprime crisis of 2008, started warning last year about a new financial bubble, people naturally took note.
Florida Teenager in Massive Twitter Hack Case Pleads Not Guilty
Chris Dolmetsch – Bloomberg
Graham Ivan Clark was one of three people charged last week; Hack was the highest-profile breach in Twitter’s history
A 17-year-old recent Florida high school graduate pleaded not guilty to charges that he hacked more than 100 high-profile Twitter accounts as part of a cryptocurrency scam by duping the social media company’s employees.
Scotland Locks Down Aberdeen After Coronavirus Spike
Alastair Reed – Bloomberg
Scotland’s government reimposed lockdown restrictions on Aberdeen, the country’s oil hub, after a spike in new coronavirus cases, First Minister Nicola Sturgeon said. Local restrictions on travel and indoor gatherings between households, along with the closing of both indoor and outdoor hospitality, were introduced in the northeastern city with immediate effect, Sturgeon told reporters in Edinburgh on Wednesday.
Switzerland Has a Golden Reason for Its Widening U.S. Trade Gap
Catherine Bosley – Bloomberg
Switzerland, known for producing world-leading pharmaceuticals, machinery and watches, has another economic distinction to its credit: Europe’s biggest trade surplus in goods with the U.S.During the first five months of the year, the country vaulted over Ireland and Germany to earn the title, according to data from the U.S. government, which is releasing numbers for June on Wednesday. Switzerland sits at No. 3 globally, up from 10th at the end of 2019, with only China and Mexico posting larger surpluses in the value of goods traded with the U.S. from January through May.
Flagstar Bank Issues Public Comment on Consumer Financial Protection Bureau Proposed Rule
WASHINGTON, July 29 — James K. Ciroli, executive vice president and CFO at Flagstar Bank, Troy, Michigan, has issued a public comment on the Consumer Financial Protection Bureau’s proposed rule entitled “Facilitating the LIBOR Transition”. The comment was written and posted on July 28, 2020:
Lax Covid-19 Strategy Doesn’t Save the Economy, Research Finds
Frances Schwartzkopff – Bloomberg
Sweden’s “light-touch approach” to curtailing the spread of Covid-19 has produced only limited economic benefits, according to research that compared spending patterns in the Scandinavian country and in Denmark, where far more restrictive policies were adopted.
Argentina Debt Deal Illustrates Coronavirus Pandemic’s Blow to Emerging Markets; Strains show the divide between countries more reliant on tourism and commodities and those with burgeoning technology industries
Amrith Ramkumar – WSJ
Investors are bracing for more defaults and disruptions in emerging markets after Argentina’s deal with creditors highlighted the pandemic’s stress on many developing economies. The agreement to grant debt relief to Latin America’s third-biggest economy eased some concerns about a prolonged dispute between Argentina and its creditors. But it also underscored the hardship caused by the coronavirus in emerging markets. Ecuador and Lebanon have also sought concessions from creditors this year, with shutdowns to stop the pandemic and tumbling commodities prices denting developing economies.
Odell Beckham Jr. Doesn’t Think the NFL Should Come Back This Season; Just before attending training camp, the Browns wide receiver says, “We’re not ready for football season. So why are we trying to push forward?”
Lane Florsheim – WSJ
After he wakes up around 10 a.m., Cleveland Browns wide receiver Odell Beckham Jr. starts his day with prayer. A protein shake and breakfast are next, and then things get more intense. Every afternoon involves a session with his team of trainers followed by an at-home workout; weights are in the evening. Beckham’s coaches and doctors work with the Browns to design his workout regimen, and this year’s was done in an extra-meticulous way due to the surgery he had in January to repair his abductor and symphysis plate. Beckham, 27, also regularly gives feedback on samples for Brand X, the nutritional-supplement company he co-founded and launched earlier this year. Ahead of the Browns’ training camp and the NFL’s now-cancelled preseason, he traveled to Mexico for a bit of relaxation, flying private to minimize possible exposure to the coronavirus. “I’m actually on a boat right now and as soon as we hop off, I’m jumping in the water and getting on [a] jetski,” he says.
Covid-19 Vaccine Trials Have a Problem: Minority Groups Don’t Trust Them; Drug companies, U.S. agencies work with churches and community activists to educate about benefits of vaccination
Jared S. Hopkins – WSJ
Researchers and companies developing Covid-19 vaccines are taking new steps to tackle a longtime challenge: People who need the vaccines most urgently, including Blacks and Latinos, are least likely to participate in clinical trials to determine whether they work safely.
Virus resurgence could plunge emerging economies into debt crisis, warns IMF; Countries with current account deficits are vulnerable to capital outflows, according to fund
Delphine Strauss – FT
A fresh mass outbreak of Covid-19 could increase the risks of an external debt crisis among emerging and developing economies which are vulnerable to sudden capital outflows, the IMF warned on Tuesday.
A needle-prick is a small price to pay to suppress Covid-19; Governments must address widespread lack of trust in inoculation
The editorial board – FT
Few relish a jab in the arm with a needle. If the syringe prevented Covid-19, then many might think it a pain worth suffering — but by no means all. Tens of thousands of anti-lockdown protesters gathered in Berlin over the weekend, some to voice their discontent at the possibility of being coerced by the state into getting vaccinated. The situation is far from unique to Germany. In Italy, where the broader anti-vaccination movement enjoys widespread support, both main anti-establishment parties campaigned last year against compulsory routine vaccinations for children. In the US, a fifth of people say they would never submit to inoculation against coronavirus; another third remain unsure. A recent online survey of UK residents showed a quarter would decline a vaccine if the government made it “available tomorrow”.
MPs say lack of early UK quarantine helped to accelerate pandemic; Government accused of allowing thousands of infected people into the country in February and March
Laura Hughes – FT
The UK government’s decision to maintain loose border controls in the early months of the pandemic “accelerated” the spread of coronavirus, MPs have concluded in a new report. The Commons home affairs select committee said on Wednesday that the government’s decision not to impose quarantine rules increased the number of “imported” infections and saw “many more” people contract the virus.
The guru business thrives as people contemplate mortality; As a second Covid-19 wave looms, have Americans given up on self-improvement?
Patti Waldmeir – FT
I started searching for silver linings in the coronavirus cloud as soon as it blotted out the sun for me in mid-March. More time to exercise, cook good food and meditate, I thought. Like millions around the world, I vowed to emerge from lockdown a better version of myself.
Scientists support plea to shut pubs, not schools; Children’s Commissioner calls for government to ‘put children first’ if new lockdown is imposed
Clive Cookson and Bethan Staton – FT
The Children’s Commissioner for England has issued a powerful plea to keep schools open if local and national coronavirus lockdowns are imposed — at the expense of pubs, restaurants and non-essential shops.
Sweden’s economy shrank less than eurozone’s at height of pandemic; Quarterly GDP contracted only 9% thanks to country’s light-touch approach to virus
Richard Milne – FT
Sweden’s economy performed better than most of Europe at the height of the pandemic even though its economy shrank by the most since the second world war, as the Scandinavian country appeared to benefit from its lighter-touch approach to coronavirus.
Is the Bank of England set to change its upbeat predictions? Early forecasts of a V-shaped economic recovery are now seen as too optimistic
Delphine Strauss – FT
The threat of new coronavirus lockdowns and a wave of job losses as the UK government’s furlough scheme comes to an end have cast further doubt on the Bank of England’s initial prediction of a V-shaped economic recovery.
Experts Shoot Down Osaka’s Claim That Gargling Helps Beat Virus
Gearoid Reidy – Bloomberg
Experts cast doubt over claims by officials in the city of Osaka that a gargling medicine could help treat coronavirus patients, even as shelves across Japan were stripped clean of popular brands.
Singapore Finds 908 Virus Cases as Most Worker Dorms Get Cleared
Niluksi Koswanage – Bloomberg
Singapore found an additional 908 cases of coronavirus infection with the bulk coming from foreign worker dormitories, according to a statement from the Ministry of Health.
Poland Reports Most Covid Deaths in 5 Weeks Even as Cases Slow
Poland reported 18 new coronavirus-related deaths in the past 24 hours, the most in a day since June 30, taking the total to 1,756 as an outbreak in the country’s industrial heartland worsens.
Novavax Covid-19 Vaccine Results Send Investors on Wild Ride
Cristin Flanagan – Bloomberg
Novavax Inc. shares saw huge swings in extended trading as investors took a critical eye to early data on its experimental vaccine for Covid-19 following a 3,800-percent rally in the stock this year. The shares briefly fell as much as 34% postmarket on Tuesday, before paring the decline. In trading before regular hours Wednesday, they were up 21%.
Covid Deaths Top 700,000; U.K. Vaccine Investment: Virus Update
The global death toll from Covid-19 surpassed 700,000, data from Johns Hopkins University showed. The U.K. government agreed to invest $18 million in a Scottish plant to manufacture a vaccine, while a panel of lawmakers criticized the British response.
Test Every American for Covid-19; The U.S. needs to be on war footing. Some 500 labs could switch to running swabs.
William A. Galston – WSJ
When the history of the Covid-19 pandemic is written, the past week may be recorded as the moment the depth of the crisis became undeniable. “Unlike many countries in the world, the United States is not currently on course to get control of this epidemic,” said a July 29 Johns Hopkins University report. “It is time to reset.” Another report, from the Association of American Medical Colleges, declared that “If the nation does not change course—and soon—deaths in the United States could be well into the multiple hundreds of thousands.”
‘Too many people are selfish’: As Americans resist COVID-19 restrictions, US nears 5 million infections
Suman Naishadham, Carla K. Johnson, Philip Marcelo – Chicago Tribune
Fourth of July gatherings, graduation parties, no-mask weddings, crowded bars — there are reasons the U.S. has racked up more than 155,000 coronavirus deaths, by far the most of any country, and is fast approaching an off-the-charts 5 million confirmed infections, easily the highest in the world.
Exchanges, OTC and Clearing
Speech by Prof Tan Cheng Han, Chairman of SGX RegCo, at the launch of the Singapore Governance & Transparency Index 2020, on “Corporate Governance in an era of Extreme Risk”
Good morning Mr Chng, Mr Tham Sai Choy, Dr Lawrence Loh, ladies and gentlemen. It is a pleasure, and a great privilege, to be invited by SID, CPA Australia and the NUS Centre for Governance, Institutions and Organisations (CGIO) to give some remarks at this year’s Singapore Governance & Transparency Forum.
Regular Firm Name Change
The Exchange was notified that Lansing Ethanol Services, LLC, a regular firm for Ethanol, has changed its name to The Anderson’s Inc. The change is a result of an acquisition.
Trading Floor Access Reminders for Reopening of Eurodollar Options Pit August 10, 2020
CME Group has published access reminders for the trading floor community ahead of the reopening of our Eurodollar Options Pit on www.cmegroup.com/info. This document can be accessed by clicking here.
Ag Economy Barometer stable, but farmers less optimistic about future
Farmer sentiment was virtually unchanged in July in comparison to a month earlier, according to the Purdue University/CME Group Ag Economy Barometer. The index rose just one point from June to a reading of 118, still 30 percent lower than in February before the pandemic began. The Ag Economy Barometer is based on responses from 400 U.S. agricultural producers. This month’s survey was conducted from July 20-24.
Nasdaq July 2020 Volumes
Nasdaq (Nasdaq: NDAQ) today reported monthly volumes for July 2020, on its investor relations website. A data sheet showing the monthly volumes and quarterly capture rates can be found at: http://ir.nasdaq.com/financials/volume-statistics
LSEG Technology delivers market maker solution to UBI Banca
London Stock Exchange Group
LSEG Technology collaborated with UBI Banca to deliver a new IT platform to enable the Bank’s market making activity; Successful go-live enabled UBI Banca to commence market making on MTS Cash for Italian Government securities; LSEG Technology provides innovative, scalable, highly efficient solutions for financial services firms and financial market infrastructure
LSEG Technology, London Stock Exchange Group’s technology solutions provider, today announces that it has successfully delivered a new IT platform for UBI Banca. LSEG’s solution enabled UBI Banca to go-live as a market maker on MTS Cash, initially for Italian Government securities.
Fixed Income Options (OFBD): “Immediate-Or-Cancel (IOC)” order validity requirement for market orders
With this circular, we would like to inform you that Eurex T7 will start to only accept market orders with order validity “Immediate-Or-Cancel (IOC)” in Fixed Income Options (OFBD) and reject market orders without this validity effective 14 September 2020.
Eurex Exchange Readiness Newsflash | Mandatory PIN procedure for Trading on Behalf (ToB) and other inquiries went live on 3 August 2020
With this Newsflash we would like to inform you that, the mandatory PIN authentication procedure for Trading on Behalf (ToB) and further inquiries was successfully introduced on Monday, 3 August 2020.
UBI Banca joins MTS Cash as market maker in LSEG technology deal; MTS Cash adds UBI Banca as a market maker for Italian government securities after the bank deployed LSEG’s IT platform.
Hayley McDowell – The Trade
Italian banking group UBI Banca has implemented a new IT platform from the London Stock Exchange Group (LSEG) to boost its market making activities. LSEG said in a statement it has delivered the system as part of a collaboration with UBI Banca, and the bank has now gone live as a market maker on its MTS Cash platform, initially for Italian government securities.
Vela deploys market data feed in AWS cloud; The SuperFeed from Vela will now be accessible to clients within the AWS cloud instantly and reliably.
Kiays Khalil – The Trade
Data and execution technology provider Vela has deployed its normalised market data feed within the Amazon Web Services (AWS) cloud environment. Vela said the move means clients will have access to its SuperFeed market data through the AWS PrivateLink, which will enable customer networks to securely access the AWS-deployed trading data instantly and reliably.
Commerzbank takes greater loan loss from Wirecard than Covid-19 debt; Write-off of EUR175m in loans to collapsed fintech greater than provisions for pandemic in Q2
Olaf Storbeck – FT
Commerzbank took a greater hit from the collapse of Wirecard in the second quarter than from the economic fallout of the coronavirus pandemic, according to people familiar with the matter.
UK start-ups face £15bn funding shortfall; New report estimates financial impact of coronavirus crisis on fast-growing companies
Andy Bounds and Daniel Thomas – FT
UK start-ups face a cash shortage of up to £15bn this year after investor funding fell away during the coronavirus pandemic, with companies outside London notably struggling for financial support, in what will be a blow to the government’s efforts to boost underperforming regions.
How Fintech Platform CNote Gives Socially Conscious Investors New Ways To Battle Inequality: An Interview With Catherine Berman
Afdhel Aziz – Forbes
Catherine Berman is CEO and cofounder of CNote, an innovative fintech platform that unlocks new investment opportunities for retail and institutional investors. Working with mission-aligned community lenders, CNote aims to close the wealth gap by allowing anyone to invest in small businesses, affordable housing and economic development in financially underserved communities, with a focus on lending to women and minorities.
ChartIQ to Expand Offering with FactSet; FactSet clients can now access Term Structure Graph in the product’s first enterprise adoption
Cosaic, a financial technology company that delivers software to promote end user workflow and efficiency, today announced that it has expanded its agreement with FactSet (NYSE: FDS) (NASDAQ: FDS), a global provider of integrated financial information, analytical applications, and industry-leading service, to include Term Structure Graph. This news comes off the tail end of a recent rebrand: Cosaic is the new company name for the world-renowned charting solution, ChartIQ.
Florida Teenager in Massive Twitter Hack Case Pleads Not Guilty
Chris Dolmetsch – Bloomberg
A 17-year-old recent Florida high school graduate pleaded not guilty to charges that he hacked more than 100 high-profile Twitter accounts as part of a cryptocurrency scam by duping the social media company’s employees. Graham Ivan Clark was charged last week with posting messages on behalf of notable businesspeople, celebrities and politicians, including former president Barack Obama, Amazon.com Inc. Chief Executive Officer Jeff Bezos and Tesla Inc. CEO Elon Musk, and luring additional victims into sending him Bitcoin donations of more than $100,000. Two others were charged with helping Clark by serving as brokers on the sale of compromised accounts.
Multiple Indian Ministries Discussing on a Law to Ban Crypto
Arnab Shome – Finance Magnates
The Indian government is gearing up to ban digital currencies again, this time by introducing a new law, another local publication confirmed. Citing an anonymous government official, Moneycontrol reported that the government has been consulting with the law ministry, ministry of information and technology, and the Reserve Bank of India (RBI) to draft a framework to ban cryptocurrency trading in India.
How hackers laundered $3.4 million Bitcoin in plain sight
Robert Stevens – Decrypt
Large travel firm CWT paid $4.5 million in Bitcoin to a hacking group. Lots of that Bitcoin went through the world’s biggest crypto exchanges. The hackers didn’t use mixing services to launder its money. But there’s a reason for that.
Square says Cash App generated $875 million in bitcoin revenue during Q2, posting $17 million in gross profit
Michael McSweeney – The Block
Square said Tuesday that it made $875 million in bitcoin revenue via its Cash App service during the second quarter of 2020. The release — which came a day early stemming from what Square called an “early external access of the company’s quarterly financials” — also notes that Cash App generated $17 million in bitcoin gross profit for the same period. Square’s filing indicates total expenses related to its bitcoin offering as $858 million.
DEX volumes made up almost 4% of centralized exchange volumes in July — a monthly high
Momina Khan – The Block
Decentralized exchanges experienced a record-breaking July for volume, surpassing $4 billion to hit a new all-time high. But July also saw the DEX space hit another benchmark: an increase in the ratio of DEX-to-centralized exchange volume. The Block Research found that this ratio reached nearly 3.95%, a jump from June’s 2.1%. Prior to June, the ratio had never surpassed 1%.
Russian Voters’ Data on Sale After Blockchain Poll to Keep Putin in Power: Report
Anna Baydakova – Coindesk
Hackers are reportedly selling the personal data of over a million Russians who voted electronically, using blockchain technology, during the recent constitutional amendment process. Over 1.1 million data points were stolen and put on sale for $1.50 each on the online forums, the Russian newspaper Kommersant wrote. The data, consisting exclusively of passport numbers, has little value on its own, the anonymous sellers admitted to Kommersant. But such data can be used for phishing attacks when combined with information from other leaked databases.
The SEC wants to buy a blockchain forensics tool for monitoring smart contracts
Aislinn Keely – The Block
The U.S. Securities and Exchange Commission (SEC) has put out a call for a blockchain forensics tool to help it monitor smart contracts. On July 30, the agency released a solicitation that gives software firms until August 13 to submit their proposals. The tool will monitor smart contract code, effectively serving as a way to keep a closer eye on the Decentralized Finance ecosystem.
Congressional lawmakers urge the IRS to craft proactive tax policy for crypto staking rewards
Aislinn Keely – The Block
A group of Congressional lawmakers have sent a letter to the Internal Revenue Service (IRS) that urges the U.S. tax agency to write policy that does not impede proof of stake technology. Representatives David Schweikert, Bill Foster, Tom Emmer and Darren Soto addressed IRS Commissioner Charles Rettig, explaining how staking works and why existing tax policy could directly impact U.S. interest in and utilization of the technology.
US Lawmakers Don’t Want Proof-of-Stake Networks to Get Overtaxed
Nikhilesh De – Coindesk
Crypto holders earning new tokens by staking their coins might be at risk of being overtaxed, believe several members of Congress. Four lawmakers wrote a letter to the Internal Revenue Service Wednesday, asking the U.S. tax agency to ensure stakers don’t face tax liabilities for receiving block rewards before they sell their new tokens. The letter, dated July 29, was sent to IRS Commissioner Charles Rettig, Chief Counsel Michael Desmond and Assistant Secretary for Tax Policy David Kautter and was signed by the Congressional Blockchain Caucus’ co-chairs Reps. David Schweikert (R-Ariz.), Bill Foster (D-Ill.), Tom Emmer (R-Minn.) and Darren Soto (D-Fla.).
Millions of Visa-accepting stores in Mexico can now take crypto
Jose Antonio Lanz – Decrypt
Tauros, a cryptocurrency exchange based in Mexico, has teamed up with Dash to launch the region’s first crypto debit card. The card be used at any Visa-accepting store in the country. It will only be available to Mexican residents and Tauros account holders.
BIS highlights decentralization and distributed ledgers with trade finance digitization competition
Michael McSweeney – The Block
The Bank of International Settlements’s Innovation Hub is partnering with the Hong Kong Monetary Authority on a new tech-focused competition centered around the digitization of trade finance. The BIS said in an announcement post on August 3 that it will be accepting prospective submissions until the end of the month. Participating judges will make their initial selections over the course of September and early October, with some participants being invited to give presentations between October 12 and 15. Projects that advance beyond that stage will be invited to develop full prototypes in a sandbox environment in 2021.
DeFi Alliance: Launches Accelerate DeFi an Accelerator
Imran Khan – Medium
The DeFi Alliance (DA) has launched an accelerator program dubbed Accelerate DeFi. The accelerator is led by Jump Capital, Cumberland (a DRW company), CMT Digital, Volt Capital, Imran Khan and Qiao Wang, with mentors from Framework Ventures, Three Arrows, ParaFi, Gauntlet, and many others.
Will Bill Barr Try to Help Trump Win the Election? Two investigations appear to be potential fodder for pre-election political machinations.
Ryan Goodman and Andrew Weissmann – NY Times
President Trump and Attorney General William Barr.Credit…Chip Somodevilla/Getty Images
Today, Wednesday, marks 90 days before the presidential election, a date in the calendar that is supposed to be of special note to the Justice Department. That’s because of two department guidelines, one a written policy that no action be influenced in any way by politics. Another, unwritten norm urges officials to defer publicly charging or taking any other overt investigative steps or disclosures that could affect a coming election.
Why Edmund Burke Still Matters; He reminds us it’s hard to respect democratic political institutions while disdaining the founders of those institutions.
Bret Stephens – NY Times
Had it not been for the revolution in France, Edmund Burke would likely have been remembered, a bit vaguely, as an 18th-century philosopher-statesman of extravagant rhetorical gifts but frustratingly ambivalent views. The Irish-born member of the British Parliament was sympathetic to the grievances of the American colonies but not (like his onetime friend Thomas Paine) an enthusiastic champion of their independence; an acerbic critic of George III but a firm defender of monarchy; a staunch opponent of English rapacity in India but a supporter of British Empire; an advocate for the gradual emancipation of at least some slaves, but no believer in equality.
US-China tensions feed into the geopolitics of monetary policy; When the Federal Reserve advances, the People’s Bank of China retreats
David Lubin – FT
On the face of it, the miserable state of the global economy makes it seem odd that any central bank might be characterised these days as hawkish. And yet that is not a bad description of the People’s Bank of China. There are some nerdy technical reasons for this. Yet there is a bigger picture, too: call it the geopolitics of monetary policy.
Trump’s Bid to Force TiTok Sale Follows Well-Trod Legal Path
David McLaughlin – Bloomberg
White House order would be almost impossible to overturn; Security officials have unwound other Chinese deals over data
President Donald Trump’s push for the sale of TikTok to a U.S. company marks a major escalation in his battle to keep data on American citizens out of Chinese hands and a move that, if successful, would be nearly impossible to overturn under U.S. law.
The Geopolitics of TikTok; A Microsoft deal makes sense, but Trump’s finder’s fee is wrong.
The Editorial Board – WSJ
It’s not news that President Trump treats trade and diplomacy like real-estate transactions. And his demand Monday that Chinese social-media company ByteDance pay the U.S. Treasury “key money” for approving TikTok’s potential sale to Microsoft is another example of how his transactional politics can undermine his own Administration’s strategic imperatives.
We Can’t Let Trump’s Post Office Mess With Voting; The election is at risk of getting lost in the mail.
Mark Gongloff – Bloomberg
The 2020 election may be lost in the mail. With a pandemic still running wild through the U.S., voting the way many Americans traditionally vote — standing in interminable lines, as the Founding Fathers envisioned — will probably be deadly this November, warns Faye Flam. Social distancing and masks won’t make much difference if you’re in a poorly ventilated gym or VFW hut with germy people for hours on end.
FBI Raids U.S. Company With Ties to Ukrainian Oligarch
Stephanie Baker and Greg Farrell – Bloomberg
A U.S. company affiliated with the Ukrainian billionaire Igor Kolomoisky that has been accused of participating in an international fraud scheme was raided by the FBI in two locations on Tuesday.
NYMEX and Two Former Employees to Pay $4 Million for Disclosing Material Non-Public Information
The Commodity Futures Trading Commission today announced that the Honorable Vernon S. Broderick of the U.S. District Court for the Southern District of New York entered a consent order resolving CFTC charges against the New York Mercantile Exchange (NYMEX) and former employees William Byrnes and Christopher Curtin for the employees’ repeated disclosure of material non-public information in violation of the Commodity Exchange Act (CEA) and CFTC regulations.
Encore – Beyond Hollywood: Money Laundering in the Securities Industry
When three hapless employees inadvertently embezzle a bunch of cash in the movie “Office Space,” they decide the best way to cover it up is to launder it. But the thing is, they don’t even really know what money laundering is and they learned that even the dictionary couldn’t fill them in.
SEC Announces New Small Business Capital Formation Advisory Committee Members
At today’s meeting of the Small Business Capital Formation Advisory Committee, the Securities and Exchange Commission announced the appointment of two new members to the Committee:
ASIC consults on proposed product intervention order for the sale of add-on motor vehicle financial risk products
ASIC is seeking stakeholder feedback on a proposed product intervention order on the sale of add-on insurance and warranty products sold with motor vehicles.
Pershing sentenced for breaching client money offences
Pershing Securities Australia Pty Ltd (PSAPL) has been sentenced in Sydney’s Downing Centre Local Court to pay a total penalty of $40,000 after pleading guilty to breaching client money obligations.
ASIC’s role in ensuring confidence is maintained in the financial system
This statement was tabled at the House of Representatives Standing Committee on Economics, Parliament House on 5 August 2020. Australia faces significant challenges as a result of the COVID-19 pandemic. ASIC is committed to making a real difference in the way our economy and our community navigates this difficult time.
Investing and Trading
Silver outpaces other global assets in best month since 1979; Precious metal rallies against backdrop of low interest rates and rising industrial demand
Henry Sanderson – FT
A 34 percent rally in the price of silver made July one of the best months on record for the precious metal, eclipsing every major global financial asset.
The anatomy of a very brief bear market; Dramatic changes in the equity risk premium may have caused US stock market volatility
Gavyn Davies – FT
The Covid-19 economy has had many unprecedented events packed into a few months, but none more extraordinary than the switchback in global equities. The advanced economies experienced a savage but brief bear market up to 23 March, followed by a spectacular recovery that eliminated all the year-to-date losses within 17 more weeks. Any investor who succeeded in navigating both legs of this reversal was either very skilled, or very lucky.
Amazon Makes Sweeping Changes for First Prime Day of Pandemic
Saritha Rai – Bloomberg
Amazon.com Inc. will kick off its first Prime Day since the coronavirus outbreak later this week in India, modifying almost everything about the retail bonanza to navigate the realities of a new era.
New York City Residents’ Wealth Drops $336 Billion From Year Ago
Jack Pitcher – Bloomberg
Wealth report finds New York hit harder than San Francisco; The U.S. is still the wealthiest nation in the world by far
The combined wealth of New York City residents shrank by an estimated $336 billion, or 13%, in the past year, exacerbated by the fallout from the coronavirus crisis in 2020. The decline — measured as of June 30 compared with the previous year — is the biggest in dollar terms among major U.S. cities during that period, according to a report released Wednesday by research firms Webster Pacific and New World Wealth.
Taking the Emotion Out of Investment Decisions; Simon Hallett imposed a set of rules on traders. The result was fewer errors and better returns.
Barry Ritholtz – Bloomberg
How do you use behavioral finance to improve investment results at a firm with $72 billion under management? One way is to restrict your portfolio managers’ freedom to make decisions. That’s what this week’s guest on Masters in Business, Simon Hallett, co-chief investment officer at Harding Loevner LP, decided to do.
Spot Gold Smashes Through $2,000 With Haven Seekers Piling In
Steven Frank and Yvonne Yue Li – Bloomberg
Spot gold soared to a record above $2,000 an ounce as investors continue to seek a haven for their assets amid daunting economic and geopolitical risks. Gold has rallied in the past year as the coronavirus pandemic prompts unprecedented amounts of stimulus to shore up economies, including lower rates, which are a boon for non-interest-yielding gold. Simmering geopolitical tensions — including a massive explosion at Lebanon’s main port on Tuesday — are also boosting demand.
Environmental, Social and Corporate Governance
Episode 5: How ESG Becomes Paramount In 2020 with Libby Bernick
Tomorrow’ Capital: How ESG Becomes Paramount In 2020 With Libby Bernick
August 5, 2020 — In the last five years, ESG and transparency around data has gained considerable traction. But where does the United States stand in terms of progress? What lessons can we take from 2020 and apply to the ESG landscape and beyond? Our host and Global Head of Sustainability at Nasdaq Evan Harvey speaks with Sustainable Finance Executive Libby Bernick on the latest episode of Tomorrow’s Capital.
JP Morgan sees portfolio trading surge in the US; Client report from JP Morgan reveals the bank has already executed 77% of its total 2019 volumes for portfolio trading.
Hayley McDowell – The Trade
JP Morgan has seen huge uptake in portfolio trading from its buy-side clients in the US amid the recent market volatility, according to a client report seen by The TRADE. The client report from the bank’s credit trading desk revealed that so far this year, JP Morgan has executed 77% of the total portfolio trading volumes it executed throughout last year.
Morgan Stanley Suspended From France’s Elite Bond Club
John Ainger, Francois De Beaupuy, and James Hirai – Bloomberg
Action taken as a result of transactions conducted in 2015; Revoked status will be for a period of at least three months
Morgan Stanley has temporarily lost its status as a primary dealer of French government bonds. The suspension, which relates to transactions that took place more than five years ago, will last at least three months and takes effect Tuesday, Agence France Tresor — the nation’s debt management office — said in a statement.
Commerzbank Beat Is Marred by Wirecard Hit in Dramatic Quarter
Steven Arons – Bloomberg
Gives up full-year profit target as bad loan provisions rise; Net income beats estimates as client trading rises in pandemic
Commerzbank AG abandoned its goal for a full-year profit after losses tied to the failure of Wirecard AG, underscoring the challenges for the German lender as it seeks a new chief executive officer. The unexpected hit blemished an otherwise solid quarter, with net income of 220 million euros ($261 million) well above analyst estimates. The bank’s online broker Comdirect posted record revenue from trading when volumes surged during the pandemic. Commerzbank said it may have to set aside as much as 1.5 billion euros this year for bad loans, more than it had previously predicted.
Robinhood Crowd Helps Hedge Fund Manager Gain 30% This Year
Sonali Basak – Bloomberg
Adam Sender bet around popular stocks like Hertz, NIO, Tesla; Firm is among those taking advantage of a return of volatility
One hedge fund manager is getting some inspiration from an unlikely source: the Robinhood crowd. Adam Sender’s volatility hedge fund has climbed 30% this year — in part by betting on and against stocks that have been popular on the retail trading app. He notched gains by wagering around stocks including Hertz Global Holdings Inc., NIO Inc. and Tesla Inc.
Foreign Investors Flock to Russian Government Bonds; After a feud with fellow oil exporter Saudi Arabia, Russia’s efforts to shore up its finances may be paying off
Anna Isaac – WSJ
Foreign investors are piling back into Russian bonds, attracted by high yields and the country’s relatively strong finances compared with emerging-market peers. Despite a heavy reliance on oil exports and tense relations with the West, investors say yields on Russian government bonds are attractive given its ability to withstand oil-price volatility. Russia marked its eighth straight week of inflows into its bonds on July 23, according to data from fund tracker EPFR Global, only outdone by China.
Hong Kong’s Richest Family Loses $8 Billion in a Single Year; The Kwoks’ shrinking fortune underscores growing doubts about Hong Kong’s future.
Venus Feng, Blake Schmidt – Bloomberg
If ever there was a bad time to own the biggest developer in the world’s most expensive real estate market, this would be it. Just ask the Kwoks. The family behind Hong Kong’s largest property empire has seen its fortune shrink by almost $8 billion in the past 12 months, the steepest drop among Asian clans on Bloomberg’s ranking of the world’s wealthiest dynasties.
Bank of Ireland Shares Gain as CEO Sees Reasons For Optimism
Peter Flanagan – Bloomberg
Lender to start new voluntary job cuts program to reduce costs; CEO says feeling marginally more optimistic about economy
Bank of Ireland Group Plc shares rose the most in almost two months, as the lender’s CEO suggested the economy is proving more resilient than expected in the face of the coronavirus outbreak. The company’s shares rose as much as 11% in Dublin to 2.04 euros, the highest level since June 8, giving Ireland’s biggest lender a market value of 2.2 billion euros. The shares traded at 1.95 euros as of 9:55 a.m.
Hillhouse-Backed Biotech Firm Jacobio Plans Hong Kong IPO
Julia Fioretti and Manuel Baigorri – Bloomberg
Chinese cancer drug company could list as soon as this year; Health care related listings in Hong Kong surging to record
Jacobio Pharmaceuticals Co., a Chinese biotechnology company focusing on cancer treatments, is planning a Hong Kong initial public offering as soon as this year, according to people familiar with the matter.
Sweden’s Economy Posted Record Slump During Pandemic Peak
Rafaela Lindeberg – Blfoomberg
Second-quarter contraction still much lower than in euro zone; Sweden’s recovery seen depending on pickup in exports
Sweden was unable to escape its worst economic contraction ever despite adopting one of Europe’s softest approaches to the Covid-19 pandemic. Gross domestic product fell 8.6% in the second quarter, more than economists had forecast. But while that’s a record slump, it’s less severe than the slumps seen elsewhere in Europe. Spain, France and Italy all shrank by double digits, and even Germany contracted 10%.
UK revives plans to manage Brexit border delays; Trucks will be stacked on motorway in Kent if new checks cause tailbacks from January 1
Peter Foster in Brighton – FT
The UK government is preparing to reactivate its “Operation Brock” contingency plan to stack thousands of trucks on the M20 motorway in Kent if there are teething problems with the new EU-UK customs border that comes into force on January 1.
Britain’s banks brace for $22 billion loan losses as outlook darkens
Iain Withers, Lawrence White – Reuters
Britain’s banks took a gloomier view than almost all their European peers in their second quarter earnings, as coronavirus fears, Brexit and low interest rates caused them to bake tougher “worst-case” scenarios into their risk models.