Lender seizes Chicago Board of Trade Building, plans revamp

Jan 12, 2023

First Read

Hits & Takes
John Lothian & JLN Staff

Today JLN introduces a new section to this newsletter, Work & Management. This section is for stories that relate to issues for workers and management, including remote work, working conditions, layoffs, hiring, and more. It also deals with management issues such as how to deal with today’s workers amid what appears to be the new normal of remote work environments and temporary offices. The section is located just above the Wellness section and today includes such stories as “Microsoft Says It Will Give US Workers Unlimited Time Off,” “Meta and Apple Fall Off Glassdoor’s List of Best Places to Work,” “Climate Data Startups Take Science Off Campus and Into Boardrooms,” “Goldman Sachs makes ‘brutal’ job cuts in quest for lower costs,” and “Mouse Jigglers, Fake PowerPoints: Workers Foil Bosses’ Surveillance Attempts.”

Global branding professional Charlie Jones is no longer with the FIA after a reorganization eliminated his position, JLN has learned from multiple sources. Jones, a Certified Association Executive and a Fellow of the American Society of Association Executives, was with the FIA since 2014 and was critical in their rebranding efforts in recent years. He was also intimately involved in the FIA conferences. JLN worked with Jones, mostly during Expos and Bocas, and always enjoyed his professionalism and enthusiasm for the industry and his job. We wish him well on his next endeavor.

Today’s lead story about the lender to the Chicago Board of Trade Building taking over ownership from Glenstar is not that remarkable an event on LaSalle Street today. However, according to the story, the CBOT Building is 82 percent occupied, which is more than I would have expected and more than what I would have thought Glenstar would have needed to make a go of it. My comment on Facebook about the story was that “Ceres would weep, if she had a face.”

Get ready for the U.S. to default on its debt due to the failure to raise the debt ceiling because of a broken House of Representatives. The bond market and T-Bill market is starting to reflect this in its prices, traders have reported to Politico.

Do you want to open a Twitter account with a certain username? Well, you might have to pay for the username or bid for it in an auction, according to one of the latest plans floating around Twitter to make money, The New York Times reports.

Congratulations to Elizabeth (Liz) Freeman, who is starting a new position as an industry specialist at Deloitte. Liz was at the CME for 21 years, most recently as head of derived data services.

The U.S. Securities and Exchange Commission seeks to hire a senior officer-associate general counsel in Washington, DC.

DRW announced on LinkedIn that its Chicago, Austin and New York offices made the list for Built In’s 2023 Best Places to Work.

Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL

*****

MSCI is hosting a free webinar called “ESG and Climate Trends to Watch for 2023” on January 26, 2023, at 11:00 a.m. EST. The webinar will examine “Energy turning points,” “Boards of the future,” and “Regulators to save the world,” and how these developments might shape the investment environment. You can learn more and register here. ~SAED

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Young Bankers Who Got Used to Smooth Sailing Prepare for a Storm; They’ve discovered deals are harder to finance, IPOs can collapse and jobs aren’t guaranteed.
Nic Querolo and Max Abelson – Bloomberg
Life on Wall Street has been so smooth for Drew Pettit’s generation that the 33-year-old Citigroup Inc. strategist decided to study financial pain. He started reading “the most bearish, miserable set of books I could potentially find.” He and colleagues whose careers began after the 2008 financial crisis benefited from a stretch when money was what Pettit calls “cheap, easy, fast.” Even when the pandemic sent markets reeling three years ago, Wall Street quickly rebounded, fueled by government help. Pettit says he and his younger colleagues “don’t have a sense for what a bad business environment looks like.”
/jlne.ws/3Xt4wID

*****Early in my career I experienced the stock market crash of 1987 while working for a discount brokerage firm, First American Discount Corporation. The head of the firm, William Mallers, Sr., told us we would always remember this time. It taught us about risk like nothing else could and I remembered it the rest of my career.~JJL

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U.S. extends public health emergency status for COVID
Ahmed Aboulenein – Reuters
The U.S. health department on Wednesday extended the COVID-19 pandemic’s status as a public health emergency, allowing millions of Americans to continue receiving free tests, vaccines and treatments. The emergency was first declared in January 2020, when the coronavirus pandemic began, and has been renewed each quarter since then. It was due to end this week. The increased availability of vaccines and medications has significantly diminished the COVID-19 pandemic’s toll since early in President Joe Biden’s term, when more than 3,000 Americans per day were dying.
/jlne.ws/3Gyp8Za

******The lady in extended sizes has not sung.~JJL

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Crypto Is Just a ‘Hot Ball’ of Momentum-Chasing Money, New Paper Says; This is what happens in the absence of fundamentals.
Tracy Alloway and Joe Weisenthal – Bloomberg
In physics, momentum is the force gathered by a moving object. In investing, it’s the ability for prices to keep going up or down. In crypto, momentum might just be the foundational characteristic. So says a new report from digital-asset investment firm Starkiller Capital. The paper’s authors Leigh Drogen, Corey Hoffstein and Kevin Otte liken crypto investing to a “hot ball of money” that’s constantly rolling in and out of cryptocurrencies and tokens. In the paper they create a spate of momentum-based portfolios to determine the degree to which prices are driven by inflows and outflows.
/jlne.ws/3GAfIwf

****** There is rain in California, time to buy bitcoin? Nah, just doesn’t cut it. Everyone else is buying, why am I not? That makes sense.~JJL

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Soaked California Faces More Rain as Residents Are Forced to Flee
Brian K. Sullivan and Mark Chediak – Bloomberg
California faces more drenching rain as a historic drought has given way to flooding that’s killed at least 17 people, closed highways and sent residents fleeing for their lives.
/jlne.ws/3Zwuo7Z

****** I think I Noah what is happening in California.~JJL

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Wednesday’s Top Three
Our most read story Wednesday was A Third of Dublin’s Office Supply Lies Dormant as Tech Giants Cut Jobs, from Bloomberg. Second was Crypto’s Hotel California Traps the Winklevoss Twins, also from Bloomberg. (And the Winklevoss twins was (were?) our MarketsWiki Page of the Day Wednesday.) Third was a tie between Bloomberg’s Growing Antisemitism in the US Is Seeping Into the Workplace and – breaking the Bloomberg streak – FTX bankruptcy documents show list of investors set to be completely wiped out, including Tom Brady and Robert Kraft, from Business Insider.

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MarketsWiki Stats
27,127 pages; 242,277 edits
MarketsWiki Statistics

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Lead Stories

Lender seizes Chicago Board of Trade Building, plans revamp
Danny Ecker – Crain’s Chicago Business
New York investment giant Apollo Global Management has taken control of the Board of Trade Building in the Loop and hired a Chicago developer to try to inject new life into the distressed landmark tower. A joint venture of Chicago-based Glenstar and Los Angeles-based private-equity firm Oaktree Capital Management last month transferred the 44-story office building at 141 W. Jackson Blvd. to an Apollo-led venture that provided the senior loan tied to the property, according to Cook County property records.
/jlne.ws/3IHPevf

When ESG Investing Looks an Awful Lot Like Gambling; If regulators are really worried about an epidemic of gambling in the stock market, they need to look in the right place.
Merryn Somerset Webb – Bloomberg (opinion)
Last year, the UK’s Financial Conduct Authority issued a warning about investing apps: The “game-like elements” some of them come with – badges, points, leader boards, fun post-trade messages – might contribute to “problematic, even gambling-like, investor behavior.” There’s new legislation coming down the line, warned the regulator, so firms relying on gamification to get people trading might want to be “reviewing their products now to ensure they are fit for purpose.” That’s about as strong an implicit threat as you get from the FCA, so I imagine there is plenty of conversation underway about what level of gamification is a good thing (it engages a new audience) and what is a bad thing (it makes that audience borrow money and use it stupidly). But if the regulator is really worried about an epidemic of gambling in the stock market, I wonder if they are looking in the right place.
/jlne.ws/3Zp88x3

Big Lesson of the Ukraine War: There’s Only One Superpower; The effort against Russia has illustrated what a world without American power would look like – and what it looks like when America uses its unmatched power well.
Hal Brands – Bloomberg (opinion)
It feels ghoulish to look for good news in Russia’s war in Ukraine, given how much misery that conflict has inflicted. But geopolitical tragedies can serve pedagogical purposes. If nothing else, this war has illustrated what a world without American power would look like – and what it looks like when America uses that unmatched power well. My day job involves teaching Johns Hopkins University undergrads and grad students about international relations. I periodically have to remind myself that one can forgive millennials and members of Gen Z for having a jaded view of America’s global role.
/jlne.ws/3Waxls6

Wall Street’s top cop trains his sights on crypto; Damian Williams faces big test in prosecuting high-profile case against FTX’s Sam Bankman-Fried
Joe Miller – Financial Times
Damian Williams made history well before he brought criminal charges against FTX founder Sam Bankman-Fried over “one of the biggest financial frauds”. In late 2021, the Brooklyn-born son of Jamaican immigrants became the first black person to be sworn in as the US attorney for the Southern District of New York, the storied branch of American justice whose jurisdiction includes Wall Street and, by extension, global finance.
/jlne.ws/3XksjtW

The U.S. May Finally Breach the Debt Ceiling. Here’s Why That Would Be Very Bad; If Congress fails to increase the government’s borrowing limit in time, the result would be a shock to the economy and financial markets.
Alan Rappeport, Jim Tankersley and Jeanna Smialek – The New York Times
The new Republican majority in the House of Representatives has Washington and Wall Street bracing for a revival of brinkmanship over the nation’s statutory debt limit, raising fears that the fragile U.S. economy could be rattled by a calamitous self-inflicted wound.
/jlne.ws/3W0a2RT

Wall Street’s New ESG Money-Maker Promises Nature Conservation – With a Catch; Belize is home to a threatened coral reef and a mountain of sovereign debt. It’s become a test case for a new kind of finance that mixes debt relief and environmental protection.
Natasha White – Bloomberg
Big global banks are eying some of the world’s most fragile countries for a new experiment in financial engineering: debt relief in exchange for environmental protections. Called “debt-for-nature swaps,” they present a tempting solution for the rising number of nations in distress, particularly those with ecosystems to protect. A country gets to avoid default and lower its debt burden, as long as it’s willing to earmark some of the savings to salvage a coral reef, preserve a forest or build a wind farm, for example. Global investors get better returns and enhanced green credentials. Wall Street takes a cut.
/jlne.ws/3CI67C9

Barry Silbert Wanted to Be Crypto’s Rockefeller. Now He’s Under Siege; Frozen funds drive escalating feud with Gemini’s Winklevoss; ‘This past year has been the most difficult of my life’
Annie Massa – Bloomberg
Barry Silbert, the founder of Digital Currency Group, is far from crypto’s most colorful executive. In an industry rife with billionaire impresarios, die-hard evangelists and outright fraudsters, the 46-year-old chief executive has the look and bearing of a middle manager at a regional bank. His inoffensive demeanor – and relatively long tenure in Bitcoin – served him well as he drew funding from companies like SoftBank and built a sprawling web of businesses that touch virtually every corner of cryptocurrency.
/jlne.ws/3GzgtWo

DCG’s crypto broker Genesis owes creditors more than $3bn; Barry Silbert’s conglomerate weighs offloading venture assets to help wholly owned digital asset lender
Nikou Asgari – Financial Times
Crypto broker Genesis owes creditors more than $3bn, prompting its owner Digital Currency Group to explore selling assets in its large venture portfolio to raise money, according to people familiar with the matter. DCG, a conglomerate that controls crypto media outlet CoinDesk and investment manager Grayscale, is seeking to raise fresh cash after its Genesis unit was wrongfooted in November by the collapse of FTX.
/jlne.ws/3GEm2Tg

FTX Says It Has Located More Than $5 Billion in Cash, Liquid Assets
Becky Yerak – The Wall Street Journal
Bankrupt cryptocurrency exchange FTX said it has located more than $5 billion in cash and other liquid assets and is hoping to sell hundreds of additional investment holdings with a book value of more than $4.6 billion. Those assets are valued as of FTX’s bankruptcy filing in November and don’t include $425 million held by authorities in the Bahamas, company lawyers said on Wednesday in the U.S. Bankruptcy Court in Wilmington, Del. FTX lawyers also told the judge overseeing the bankruptcy case that the amount of the shortfall in FTX customer funds isn’t yet clear.
/jlne.ws/3W60KUv

Ripple: ‘Congress must examine the SEC’s role in the recent crypto contagion’
Stu Alderoty – Fortune
With the recent collapse of BlockFi and FTX, the regulation-by-enforcement approach of the U.S. Securities and Exchange Commission (SEC) when it comes to crypto has been called into question by industry representatives, policymakers, and crypto consumers alike. The SEC continues to elevate its own quest for power over sound policy.
/jlne.ws/3kcUahG

EU frets over crypto rules after FTX blow-up; Rulemakers question whether upcoming regulations will be enough to protect the bloc from future corporate implosions
Scott Chipolina and Laura Noonan – Financial Times
The collapse of Bahamas-based crypto exchange FTX has sparked fresh debate in Europe about whether the bloc’s digital asset regulations are up to the job of protecting the public against similar calamities. FTX’s spectacular implosion in November further destabilised a market that had already been left reeling after an unprecedented collapse in the summer. Several once-prominent firms went bankrupt after a 70 per cent drop in crypto token prices, injecting urgency into global policymakers’ efforts to tame an industry widely described as the “wild west” of finance.
/jlne.ws/3QB1wY9

Coinbase Strikes a Massive Blow to Bankman-Fried and FTX
Luc Olinga – TheStreet
Coinbase Chief Executive Brian Armstrong does not mince words. Nearly two months after rival Sam Bankman-Fried’s empire went bankrupt, he’s just delivered a massive blow to what until recently was the institutional face of crypto. Bankman-Fried’s empire consisted of the FTX cryptocurrency exchange. Before its rout, it was the third largest cryptocurrency exchange based on volume after Binance and Coinbase. FTX last February was valued at around $32 billion.
/jlne.ws/3itnkZs

SBF Said a Stalker Tried to Conduct a ‘Citizen’s Arrest’ on Him at His Parents’ House
Kyle Barr – Gizmodo
Sam Bankman-Fried has been charged with eight counts of fraud and conspiracy for using FTX customer funds as a personal piggy bank with his hedge fund Alameda Research. Failed co-founder and CEO of the FTX crypto exchange Sam Bankman-Fried reportedly has a few layers of security while he’s at home waiting for trial, including security guards and a 75-pound German shepherd. Though since his address is easily Googleable, angry former fans still seem intent on paying the once-crypto mogul a visit.
/jlne.ws/3X6J9wL

Sam Bankman-Fried says he’s been playing video games alone while under house arrest and hasn’t talked to ex-girlfriend Caroline Ellison
Sindhu Sundar – Business Insider
Sam Bankman-Fried hasn’t spoken to the once-close associates he lived with in the Bahamas when he ran FTX. The former FTX CEO, who is under house arrest at his parents’ Palo Alto home (which helped secure his release on a $250 million bond), described a lonely daily routine in an during an in-person interview with a reporter from Puck News.
/jlne.ws/3ZxA81B

Sam Bankman-Fried Resurfaces With Fresh Defense of FTX Collapse
Caitlin Ostroff – The Wall Street Journal
Sam Bankman-Fried is back online, using a new public forum to rally his defense. The founder of FTX launched “SBF’s Substack” on Thursday, giving his take on the events leading to the crypto exchange’s collapse. Mr. Bankman-Fried is under house arrest at his parents’ California home as he faces federal fraud charges. He has pleaded not guilty.
/jlne.ws/3QGywi0

Bankman-Fried Says He ‘Didn’t Stash Billions’ as He Denies Theft; FTX founder blames cryptocurrency crash, rival for blowups; He’s on bail and faces US trial in October on fraud charges
Ava Benny-Morrison – Bloomberg
Sam Bankman-Fried offered one of his most detailed descriptions yet of the FTX debacle as he prepares to fight fraud charges, blaming crashing markets and an attack from a rival for the eventual bankruptcy of his exchange. “I didn’t steal funds, and I certainly didn’t stash billions away,” the former crypto magnate wrote in a blog post Thursday. “I’ve been, regrettably, slow to respond to public misperceptions and material misstatements.”
/jlne.ws/3ZzlIOy

What’s the Relationship Between Crypto and AI? Is There Any?
David Z. Morris – CoinDesk
The past six months has been a banner stretch for the development of artificial intelligence (AI). Image processors such as Midjourney and text generators including ChatGPT have sparked immense public fascination and debate. Unlike the promise of self-driving cars, these applications seem ready for real commercial deployment. That could pose a problem for tech innovators focused on public blockchains and distributed computing. At minimum, artificial intelligence will be a huge competitor for investment funding for the foreseeable future, particularly given the reputational damage various scammers and frauds inflicted on crypto over the past year.
/jlne.ws/3CJqXB8

Europe Still Winning on LNG Imports Even as Prices Slump
Anna Shiryaevskaya, Thomas Gualtieri and Vanessa Dezem – Bloomberg
Europe is still awash with liquefied natural gas despite a crash in benchmark prices as demand in Asia remains lackluster. A few weeks ago, it became more profitable to deliver US LNG to Asia than to Europe, but that premium has been insufficient to lure cargoes away from a region that’s been flooded with the fuel in recent months.
/jlne.ws/3GtsI6w

Treasury’s Yellen to Stay On at Biden’s Request as Showdown Over Debt Nears
Josh Wingrove – Bloomberg
President Joe Biden asked Treasury Secretary Janet Yellen to stay in her post, and she agreed, a White House official familiar with the matter said. Biden made the request in mid-December, the official said. Biden is preparing for turnover in his Cabinet and questions have swirled over how long Yellen would remain in his administration.
/jlne.ws/3GZv7Yf

BOE Made £3.5 Billion Profit on Emergency Bond Market Intervention; Central bank sells off last bonds, unwinding portfolio; BOE still faces over £100 billion of losses on QE facility
David Goodman and Philip Aldrick – Bloomberg
The Bank of England made a profit of about £3.5 billion on September’s emergency bond market intervention after selling off the final bonds on Thursday. The central bank bought almost £19.3 billion of long-term government debt following then-Prime Minister Liz Truss’s disastrous budget last year. The BOE stepped in to prevent a shock in the gilt market from turning into an economic crisis.
/jlne.ws/3IIlRJj

The TRADE Crypto Roundtable: Episode 4 – Pushing progress; In which we discuss what various stakeholders can and should be doing to move things forward, develop the industry, and support innovation.
Laurie McAughtry – The Trade
In December, The TRADE brought key stakeholders together for an in-depth discussion of the barriers to institutional involvement in digital assets. In the fourth of five video episodes, the discussion broadens out to explore key issues of unbundling, the role each provider can play, the crucial need for consistency and – in the light of recent events – why the chaos in recent months came from problems with individual players, not the processes themselves.
/jlne.ws/3CHouqW

Hong Kong’s exchange vies to regain top IPO spot, opens US office The bourse saw a fall of 68% in total IPO proceeds last year compared to 2021, but capital markets have shown signs of recovery
Sara Velezmoro – FinanceAsia
Hong Kong Exchanges and Clearing (HKEX) has announced the establishment of its first US office in New York. The move is the latest demonstration of the bourse’s determination to regain its top spot among major exchanges, after falling to 10th place in IPO market rankings in the middle of last year.
/jlne.ws/3jZs2yf

Ukraine Invasion

Russia appoints top soldier Gerasimov to oversee Ukraine campaign
Reuters
Russian Defence Minister Sergei Shoigu appointed Chief of the General Staff Valery Gerasimov on Wednesday to oversee the military campaign in Ukraine, in the latest shake-up of Moscow’s military leadership. Gerasimov, like Shoigu, has faced sharp criticism from Russia’s hawkish military bloggers for multiple setbacks on the battlefield and Moscow’s failure to secure victory in a campaign the Kremlin had expected to take just a short time. In a statement, the defence ministry said Shoigu had appointed Gerasimov as commander of the combined forces group for the “special military operation” in Ukraine. It is the most senior position among Russia’s battlefield generals.
/jlne.ws/3GZ2hHB

Russia says EU is becoming a vassal of NATO
Reuters
Russia said on Wednesday that the European Union was becoming a vassal of NATO, citing the signing of a joint declaration in which the two organisations pledged to deepen their cooperation in response to Russia’s war in Ukraine. In the declaration on Tuesday, NATO and the EU stated: “Today, we are faced with the gravest threat to Euro-Atlantic security in decades. Russia’s brutal war on Ukraine violates international law and the principles of the U.N. Charter.”
/jlne.ws/3ZxrzUg

Russia using old Ukrainian weapons sent in goodwill on front line
Mansur Mirovalev – Al Jazeera
Called the White Swan, the Tu-160 is the world’s heaviest and fastest supersonic bomber. The Soviet-designed flying fortress can circle half the globe, fly as high as 20km (12.4 miles) above Earth and carry 45 tonnes of bombs – or a dozen Kh-55 nuclear missiles. Moscow has 16 White Swans and has been using them as trump cards in its renewed confrontation with the West. In recent years, they have flown over the North Pole to violate US and Canadian airspace, landed in Venezuela and launched cruise missiles at Syria.
/jlne.ws/3X4b6FB

Putin made a big bet that energy sales would fund his war in Ukraine. A new report shows that he was very wrong
Tristan Bove – Fortune
Vladimir Putin’s hope that oil and gas revenues would help Russia’s economy weather the storm of sanctions over its invasion of Ukraine took a big hit in December, when Russian fossil fuel sales collapsed.
/jlne.ws/3GZbKyx

Putin running out of options in global pressure campaign
Ellen Mitchell – The Hill
As the Russia-Ukraine war nears the end of its first year, Moscow is struggling to find leverage to wear down Western resolve to aid Kyiv. With its battlefield wins now few and far between, an economy crippled by harsh sanctions, and increasing international isolation, Russian President Vladimir Putin is running out of options to expand its provocations beyond Ukraine to chip away at international support for Ukraine’s resistance, experts say.
/jlne.ws/3vXsMXr

Vladimir Putin’s budget faces ‘catastrophe’ after Western price cap spells doom for Russian oil exports
Christiaan Hetzner – Fortune
The West’s price cap on Russian crude oil could have a catastrophic effect on Vladimir Putin’s finances and force the pariah state into imposing austerity measures this year. The price of the “Urals” benchmark grade of crude oil exported from Russia has been falling steadily since the cap went into effect on Dec. 5. At that level, production can continue, but at a level much closer to extraction costs, thereby greatly diminishing Russian profits.
/jlne.ws/3W47XUL

The Ukraine War Is Still Relatively Low-Tech – for Now; Both sides are using all kinds of 21st-century equipment, but old-school meat-grinder fighting is still deciding the direction of the war.
Leonid Bershidsky – Bloomberg
If you believe that software is eating the world, the war in Ukraine seems incomprehensibly low-tech. In many areas, it looks barely distinguishable from World War I-style trench warfare, and Ukraine’s repeated requests for more artillery and tanks suggest a reliance on World War II-era warfighting methods.
/jlne.ws/3Xnsxkf

Generators Help Shops Keep Lights on for Ukrainians Hit by War
Olesia Safronova – Bloomberg
On Kyiv’s bustling main shopping avenues, the roar of diesel generators is a symbol of how Ukrainians are adapting to war. After months of blackouts caused by Russian attacks against the country’s energy infrastructure, everyone from mom-and-pop companies to international retailers are keeping the lights on with machines chugging away on sidewalks and cables snaking indoors.
/jlne.ws/3GYV5ei

Homemade Body Armor and Anti-Drone Apps. This Is Ukraine’s Civil Defense.
Anna Husarska – The New York Times
With tourniquets, there is no way of doing things on the cheap. These lifesaving devices, used to stop blood loss from a wounded limb and prevent death from bleeding, need to be 100 percent reliable: a solid, wide Velcro band sufficiently long to be put around a thigh and a tough crank to pull it tight, with a sturdy locking mechanism. A good tourniquet costs $20 to $30 and the best ones are made in the United States. As with many other products, Chinese vendors sell a variety of fakes – something as simple as a rope on a rod is an invitation to counterfeit. Worse than useless, the Chinese knockoffs are a liability when they snap in the trembling, slippery hands of a bleeding person.
/jlne.ws/3kfO0gs

Exchanges, OTC and Clearing

EEX sets new annual record for European Dairy Futures trading
EEX
The European Energy Exchange’s (EEX) Dairy Derivatives Market set a new record in 2022. The total trading volume grew by 51% to 41,537 contracts (equivalent to 207,685 tonnes of goods) compared to 27,449 contracts (representing 137,245 tonnes of goods) in 2021. The exchange achieved double-digit growth rates in the established dairy futures contracts: The volume in Butter Futures rose to 14,206 contracts (71,303 tonnes), an 24% increase compared to the previous year. EEX recorded strong growth in Skimmed Milk Powder Futures, which grew by 70% to 25,325 contracts (126,625 tonnes) and in Whey Powder Futures, which soared 74% to 2,006 contracts (equivalent to 10,030 tonnes of goods).
/jlne.ws/3QwjBa0

Euronext Corporate Services’ IntegrityLog supports greater protection for whistleblowers in Finland
Euronext
Euronext Corporate Services’ IntegrityLog supports the implementation of the European Union (EU) Whistleblower Directive in Finland. The online tool can automate whistleblowing for companies in a safe and anonymous way to guarantee protection for whistleblowers. On 9 December 2022, the Finnish law implementing the EU Whistleblower Directive was adopted by the Finnish parliament and will come into force in January 2023, changing the way whistleblowers are protected. The new law includes the obligation for companies and public institutions with at least 50 employees, as well as municipalities with more than 10,000 inhabitants, to implement a whistleblowing system.
/jlne.ws/3CIWkfi

Nasdaq Announces End of Month Open Short Interest Positions in Nasdaq Stocks as of Settlement Date December 30, 2022
Nasdaq
At the end of the settlement date of December 30, 2022, short interest in 3,462 Nasdaq Global MarketSM securities totaled 10,481,618,341 shares compared with 10,247,653,483 shares in 3,476 Global Market issues reported for the prior settlement date of December 30, 2022. The end of December short interest represent 2.82 days average daily Nasdaq Global Market share volume for the reporting period, compared with 2.84 days for the prior reporting period.
/jlne.ws/3ZHbn34

Nasdaq December 2022 Volumes and 4Q22 Statistics
Nasdaq
Nasdaq (Nasdaq: NDAQ) today reported monthly volumes for December 2022, as well as quarterly volumes, estimated revenue capture, number of listings, and index statistics for the quarter ended December 31, 2022 on its investor relations website. A data sheet showing this information can be found at: http://ir.nasdaq.com/financials/volume-statistics.
/jlne.ws/3W520Hk

TMX Accelerates Data Expansion with Investment in VettaFi
Shanny Basar – MarketsMedia
TMX Group has invested in US data, analytics and indexing provider VettaFi Holdings to boost growth of TMX Datalinx, the Canadian exchange operator’s data and analytics division. On January 9 TMX Group announced it had acquired 21% of the common equity of VettaFi for $175m, approximately C$234m.
/jlne.ws/3W0wlql

TMX Group Limited announces release date for Q4 2022 financial results and analyst conference call
TMX Group
TMX Group Limited will announce its financial results for the fourth quarter ended December 31, 2022 in the evening of Monday, February 6, 2023. An analyst conference call to review the results will be held on Tuesday, February 7, 2023 at 8:00 a.m. ET.
/jlne.ws/3GCvgzk

Fintech

JP Morgan Says Startup Founder Used Millions Of Fake Customers To Dupe It Into An Acquisition
Alexandra S. Levine – Forbes
JPMorgan Chase is suing the 30-year-old founder of Frank, a buzzy fintech startup it acquired for $175 million, for allegedly lying about its scale and success by creating an enormous list of fake users to entice the financial giant to buy it. Frank, founded by former CEO Charlie Javice in 2016, offers software aimed at improving the student loan application process for young Americans seeking financial aid. Her lofty goals to build the startup into “an Amazon for higher education” won support from billionaire Marc Rowan, Frank’s lead investor according to Crunchbase, and prominent venture backers including Aleph, Chegg, Reach Capital, Gingerbread Capital and SWAT Equity Partners.
/jlne.ws/3W4X2u4

There’s a brewing ‘AI arms race’ and Microsoft’s ChatGPT play is ‘a potential game changer,’ Wedbush’s Dan Ives says
Will Daniel – Fortune
The world is gearing up for an artificial intelligence (A.I.) arms race, and it won’t just be between global superpowers vying for military supremacy-it will also include tech giants like Alphabet, Apple, and Google, along with thousands of startups.
/jlne.ws/3Qxvbl2

Wirecard CEO ‘demanded retrospective changes to data’; Markus Braun is implicated by former lieutenant in court case examining collapse of payments firm
Olaf Storbeck – Financial Times
Markus Braun urged one of his top lieutenants at Wirecard, the collapsed payments firm, to retrospectively change internal accounting data, a panel of five judges at Munich Regional Court heard on Wednesday. Oliver Bellenhaus, a former Wirecard executive who has turned chief witness for the prosecution in a trial examining one of Europe’s largest accounting scandals, has for the first time made specific allegations that Braun, chief executive at the time, was directly involved in the fraud.
/jlne.ws/3vYTa3g

Ferrari Ends Blockchain Pact with Swiss Firm Velas as Deals Sour; In 2021 tie-up Velas was to provide digital content for fans; Similar crypto team-ups at Inter Milan, Chelsea also folded
Daniele Lepido and Anna Irrera – Bloomberg
Ferrari NV’s Formula One Team has ended its partnership with blockchain technology company Velas Network AG, as deals between sports companies and firms in the beleaguered cryptocurrency sector continue to crumble.
/jlne.ws/3W4sSr4

Iress taps Megaport to provide global cloud connectivity for market data
Iress via Finextra
Iress today announced it has partnered with Megaport, a global Network-as-a-Service (NaaS) provider, to provide connectivity between Iress and all major public cloud providers globally, including AWS, Microsoft Azure and Google Cloud Platform.
/jlne.ws/3QwTK1D

Speed, Technology and Partnership: Inside STT’s Vision for 2023
Jennifer Nayar – Sterling Tech
It has been a whirlwind few months since I joined STT, and now that the dust has settled, I’m struck by all that our team accomplished in 2022, both before and after my arrival. From the record growth of our OMS to the introduction of FX and crypto to our risk and margin system, our many significant hires and our return to visiting clients in their offices, to say that it has been a busy – and rewarding – year would be an understatement.
/jlne.ws/3ZwUGr2

Cybersecurity

Viral ChatGPT Spurs Concerns About Propaganda and Hacking Risks; Hackers may develop phishing emails and their own AI models; Defenders say chatbot also likely to help them fend off hacks
Katrina Manson – Bloomberg
Ever since OpenAI’s viral chatbot was unveiled late last year, detractors have lined up to flag potential misuse of ChatGPT by email scammers, bots, stalkers and hackers. The latest warning is particularly eye-catching: It comes from OpenAI itself. Two of its policy researchers were among the six authors of a new report that investigates the threat of AI-enabled influence operations. (One of them has since left OpenAI.)
/jlne.ws/3XhrRNq

LastPass hack: Cybersecurity experts sound the alarm over data breaches
Breck Dumas – Fox Business
Cybersecurity experts are expressing concern over the latest data breach suffered by password manager LastPass, as the cloud security company remains mum in the face of a class-action lawsuit linked to multiple hacks on the firm last year. LastPass first alerted customers in August 2022 that “an unauthorized party gained access to portions” of its network through a developer’s compromised account, and determined at the time that no customer data or encrypted password vaults were accessed by the hacker.
/jlne.ws/3X707uS

Cybersecurity spending and economic headwinds in 2023
Jon Oltsik – CSO Online
Now that everyone, their brother, sister, and dog have chimed in on cybersecurity predictions for 2023, here are a few observations based on some recent ESG research. First the numbers: 53% of organizations will increase IT spending in 2023, 30% say IT spending will remain flat in 2023, and 18% forecast a decrease in IT spending. As for cybersecurity, 65% of organizations plan to increase cybersecurity spending in 2023.
/jlne.ws/3CLsSFp

Cryptocurrencies

Sam Bankman-Fried’s Supersized Bet: $1 Billion for a Bitcoin Miner on the Kazakh Steppe
Eliot Brown and Yuliya Chernova – The Wall Street Journal
Just before crypto markets plunged last year, Sam Bankman-Fried’s hedge fund made a $1 billion bet on Genesis Digital Assets, a Cyprus-registered bitcoin miner rigged to consume a small city’s worth of electricity in Kazakhstan. The cash injection from Mr. Bankman-Fried’s Alameda Research LLC was supersized even for the red-hot crypto startup world, and it dwarfed the FTX founder’s other investments in private companies.
/jlne.ws/3IHF6m7

Crypto exchange Binance plans 15%-30% hiring spree in 2023 even as rivals slash jobs
Arjun Kharpal – CNBC
Binance is planning a hiring spree in 2023, CEO Changpeng Zhao said Wednesday, taking a somewhat contrarian view as crypto firms lay off huge swathes of staff amid continued pressure on coin prices. Zhao said Binance, the world’s largest cryptocurrency exchange, said the company increased head count in 2022 from 3,000 people to “almost” 8,000. In 2023, Binance plans to increase the number of staff by between 15% and 30%, Zhao said at the Crypto Finance Conference in St. Moritz, Switzerland. Rival exchanges have been forced to cut large parts of their workforces after nearly $1.4 trillion was wiped off the crypto market in 2022 and major digital currencies including bitcoin and ether saw their prices plunge.
/jlne.ws/3GzSlCP

Binance’s US unit gets court approval to move forward with $1 billion bid for bankrupt crypto lender Voyager’s assets
Carla Mozee – Markets Insider
Bankrupt crypto lender Voyager Digital has won initial court approval to sell assets to the US arm of Binance, allowing the cryptocurrency exchange to move ahead with its planned $1 billion agreement. The proposed buyout includes a $20 million cash payment and an agreement to transfer Voyager’s customers to the crypto exchange, Voyager attorney Joshua Sussberg told the United States Bankruptcy Court for the Southern District of New York in a Tuesday hearing, Reuters reported. Customers would then be able to make withdrawals.
/jlne.ws/3CJoWF4

FTX finds over $5 billion in liquid assets, judge extends ruling keeping creditor names secret
Alexis Keenan and David Hollerith – Yahoo! Finance
A lawyer for FTX said Wednesday in a Federal bankruptcy hearing in Delaware that lawyers have located over $5 billion of cash, liquid cryptocurrency, and other liquid investments belonging to the company measured as of November 11, the date FTX filed for bankruptcy protection. In a ruling from the bench, federal bankruptcy Judge John T. Dorsey granted FTX’s motion to keep its customer’s names under seal. The $5 billion in newfound assets do not include crypto in custody with the Securities Commission of the Bahamas valued at approximately $425 million as of the company’s petition date, the attorney added.
/jlne.ws/3QABPHj

FTX’s Next Bankruptcy Hearing: Deadlines, Leases, and SBF’s Attorneys Step Forward
Stacy Elliott – Decrypt
Deadline extensions and auctioning distressed assets are on the schedule along with Sam Bankman-Fried’s attorneys entering the chat during the next FTX bankruptcy hearing. The court hearing is scheduled for Wednesday, January 11 at 9 a.m. EST in the District of Delaware Bankruptcy Court and will be livestreamed on YouTube. FTX came under fire in early November when its closer-than-previously-disclosed relationship with its trading desk, Alameda Research, lead to allegations of commingled funds, theft and fraud. By November 11, the company filed for bankruptcy and its disgraced founder, Bankman-Fried, stepped down as CEO.
/jlne.ws/3k7WG8L

Gemini escalates battle with billionaire Barry Silbert, terminates its ‘Earn’ product
Marco Quiroz-Gutierrez – Fortune
Gemini, the crypto exchange founded by Cameron and Tyler Winklevoss, ramped up the pressure in its dispute with Digital Currency Group’s Genesis Global Trading, which it claims owes the company nearly $1 billion. Gemini first partnered with Genesis starting in 2021 when it launched its Gemini Earn product, which promised customers yields of about 8%. The product involved customers lending crypto to Genesis, which loaned the money to institutional investors.
/jlne.ws/3QwjFqi

Digital Currency Group in spotlight over suspicious fund transfers
Forkast
It’s often said that good things come in threes. Developments in the cryptocurrency industry in the past few days suggest that the reverse may also be true. The murky goings-on around Barry Silbert-led crypto empire Digital Currency Group (DCG) may not have attained FTX- or Terra-like levels of gut-wrenching awfulness – at least not at the time of writing. But the news that U.S. federal prosecutors are digging into transfers between DCG and one of its subsidiaries may presage a third nausea-inducing twist in the shakeout that has convulsed the crypto industry in recent times.
/jlne.ws/3wfUoYd

FTX Creditor Claims Going for 13 Cents on the Dollar on Bankruptcy Marketplace Xclaim
Sam Reynolds – CoinDesk
The $91.7 million in FTX creditor claims listed on the claims trading marketplace Xclaim will likely get around 13 cents on the dollar, according to data released by the site. This is in contrast to the much higher prices that failed companies Voyager Digital, BlockFi and Celsius Network are getting, with claims trading at 41 cents, 28.5 cents and 18.5 cents, respectively. According to Xclaim’s chief strategy officer, Andrew Glantz, this discount is occurring because there’s less public information available about the claims.
/jlne.ws/3VYHDLS

FTX Creditor Names Can Remain Sealed for Now, Judge Rules
Jack Schickler – CoinDesk
A Delaware bankruptcy judge on Wednesday allowed a list of creditors for FTX to remain sealed for at least another three months. Judge John Dorsey, overseeing the winding up of Sam Bankman-Fried’s empire, shot down a bid by media organizations and the U.S. government to keep the legal process transparent, but indicated that he may change his mind during a future hearing. “I’m reluctant at this point to say I’m going to require the disclosure,” Dorsey said at a hearing Wednesday.
/jlne.ws/3kcBOx2

FTX Advisers Have Found $5 Billion Cash or Sellable Crypto
Steven Church – Bloomberg
FTX Group advisers have found more than $5 billion in cash or crypto assets that it may be able to sell to help repay creditors, a lawyer for the company told the judge overseeing the biggest crypto bankruptcy. The company is working to monetize assets with a book value of $4.6 billion, company attorney Andrew G. Dietderich said in federal court in Wilmington, Delaware on Wednesday. Advisers have also found a large amount of other crypto assets that are illiquid and therefore harder to sell, he said.
/jlne.ws/3XkJyLS

Winklevoss twins’ accusations of lies and fraud at crypto giant DCG are a ‘desperate publicity stunt’, the Genesis owner says
Zahra Tayeb – Business Insider
Gemini cofounder Cameron Winklevoss’s accusation of lies and fraud at Digital Currency Group are a “desperate publicity stunt,” DCG said. The company made the dig in a Tuesday tweet responding to Winklevoss’s recent open letter to the board of DCG. In the letter, Winklevoss said Barry Silbert and his company DCG have defrauded Gemini users under its Earn program. He even called for Silbert to step down as CEO, calling him an “unfit” leader. “This is another desperate and unconstructive publicity stunt from @cameron to deflect blame from himself and Gemini, who are solely responsible for operating Gemini Earn and marketing the program to its customers,” DCG said in a tweet.
/jlne.ws/3vWllQl

SBF, who was once worth $26 billion, says he tried to survive on a jar of peanut butter when in a Bahamian prison
Cheryl Teh – Business Insider
Disgraced ex-FTX CEO Sam Bankman-Fried says he tried to survive on a jar of peanut butter when being held at the Fox Hill prison in the Bahamas. Bankman-Fried, who is currently under house arrest, spoke about his short incarceration in the Bahamas during an interview with Puck News, published on Tuesday. “I spent a while trying to see how far a jar of peanut butter could get me,” Bankman-Fried told Puck News. “It was a little touch and go for a while,” Bankman-Fried said, speaking of his health during his imprisonment at Fox Hill.
/jlne.ws/3IHlxKM

Dutch Bitcoin Exchange Bitvavo Says DCG’s Payback Plan ‘Not Acceptable’
Andrew Asmakov – Decrypt
Dutch Bitcoin exchange Bitvavo said it had rejected Digital Currency Group’s (DCG) proposal to repay 70% of Genesis Trading’s debt, arguing that it should be able to pay back the entirety of locked funds. Last month, the Dutch exchange revealed it had EUR280 million ($297 million) stuck with Genesis, holding its parent company DCG accountable for the funds. In its latest blog post, Bitvavo said that on January 9 DCG made a proposal offering to refund 70% of the outstanding amount in a period acceptable to the Dutch exchange. Per the exchange, “the latter is not acceptable because DCG has sufficient funds available for full repayment.”
/jlne.ws/3GDj5Ci

Top NFT Artists Are Launching Projects on Instagram and Selling Out in Seconds
Rosie Perper – CoinDesk
Instagram is one of the largest social media platforms in the world, with around 2 billion monthly active users. Early last year, its parent company Meta Platforms began testing out non-fungible token (NFT) sharing, allowing select users to connect to their digital wallets and showcase NFTs that they either created or bought.
/jlne.ws/3WdXTZK

Politics

Financial Engineering the Debt Ceiling; Also profitable nonprofits, FTX assets and WWE governance.
Matt Levine – Bloomberg
The dumbest thing in economics, the US government’s debt ceiling, is clattering into relevance again. Basically the US Department of the Treasury has to pay the US government’s bills, and to do that it issues debt, and every time it issues new debt it adds a little to the total amount of debt outstanding, and eventually the debt outstanding reaches some arbitrary number called the “debt ceiling.” And then Treasury can’t issue any more debt, unless Congress raises the debt ceiling.
/jlne.ws/3GXuZID

The IRS Needs Billions to Make Trillions; Underfunding the Internal Revenue Service allows scofflaws to go unpunished and will only increase the US budget deficit.
Alexis Leondis – Bloomberg
Regardless of how you feel about the Internal Revenue Service – it’s dysfunctional, it’s underfunded, or both – there’s a basic point that’s hard to refute: The current system to ferret out wrongdoers is terrible. And in a move that will only make it worse, House Republicans voted Monday to block new funding allocated for the agency by the last Congress. Consider that the tax gap, or the difference between what taxpayers owe and what they actually pay, averaged $496 billion from 2014 through 2016 (the agency’s most recent estimates). Even after audits and enforcement actions, the agency collected just 14% of total taxes owed but not paid, or $68 billion.
/jlne.ws/3GyqXFu

Letter From US Senators ‘Inappropriate,’ Won’t Sway Me, FTX Bankruptcy Judge Says
Jack Schickler – CoinDesk
A bipartisan letter from four U.S. senators is an “inappropriate” intervention in bankruptcy proceedings that won’t sway judicial decisions, Delaware Judge John Dorsey told a court hearing Wednesday. The letter, from John Hickenlooper (D-Colo.), Thom Tillis (R-N.C.), Elizabeth Warren (D-Mass.) and Cynthia Lummis (R-Wyo.) called for an independent examiner to be appointed to investigate the collapse of the crypto exchange. The letter is an “inappropriate ex parte communication,” Dorsey said, using a legal term for court interventions that don’t give all parties the chance to be represented.
/jlne.ws/3XpYf09

Rep. George Santos was paid by a company that the SEC called a ‘classic Ponzi scheme’ but he never disclosed the payments as a candidate, report says
Kelsey Vlamis – Insider
Republican Rep. George Santos of New York was paid by a company that the Securities and Exchange Commission called a “classic Ponzi scheme” but failed to disclose it, according to a report published Wednesday by The Washington Post. Santos, who has made false claims about his education and employment history, was paid by the firm, Harbor City Capital, which is based in Florida, as recently as April 2021, according to Katherine C. Donlon, a lawyer appointed by the court to review the firm. She declined to tell The Post how much Santos was paid.
/jlne.ws/3X1NcKO

Can Rishi Sunak Stand Up to the Last Brexit Holdouts? A deal giving the EU access to real-time data on trade in Northern Ireland opens the door a crack for a broader resolution to the Brexit impasse.
Therese Raphael – Bloomberg
When Prime Minister Rishi Sunak took office in November promising stability, the last thing he needed on his plate of woes was a trade war with Europe. Although the UK-European Union data agreement announced Tuesday is a long way from a comprehensive deal to resolve the Brexit impasse over Northern Ireland, it makes one a lot more likely.
/jlne.ws/3IDMb7r

UK and EU Aim for Final Deal to End Brexit Clash in Fresh Talks; “Tunnel” talks aim to unlock Northern Ireland protocol dispute; The advance comes after an agreement on data sharing
Alberto Nardelli, Alex Wickham, and Morwenna Coniam – Bloomberg
The European Union and the UK are preparing to enter an intense phase of negotiations starting next week aimed at overcoming the dispute over the post-Brexit trading relationship well ahead of the anniversary of Northern Ireland’s peace agreement in April, according to people familiar with the matter. The aim is to move into a negotiating “tunnel” after UK foreign minister James Cleverly and European Commission Vice-President Maros Sefcovic take stock of talks on Jan. 16, said the people, who spoke on condition of anonymity to discuss private talks.
/jlne.ws/3X3WlSZ

Abu Dhabi oil chief appointed president of COP28 climate summit; Sultan al-Jaber’s pivotal role in upcoming Dubai conference sparks concern among green campaigners
Simeon Kerr, Camilla Hodgson and Aime Williams – Financial Times
The head of Abu Dhabi’s state-owned oil company has been appointed president of this year’s UN climate summit by host nation the United Arab Emirates, prompting concern among climate advocates that the move could stymie efforts to reduce fossil fuel consumption.
/jlne.ws/3GWgoNN

Regulation

Commissioner Goldsmith Romero to Provide Keynote Address at the University of Pennsylvania Carey Law School’s Symposium, The FTX Fiasco: Unpacking the Most Complex Bankruptcy in History
CFTC
Commissioner Goldsmith Romero will provide the keynote address at the University of Pennsylvania Carey Law School’s symposium, The FTX Fiasco: Unpacking the Most Complex Bankruptcy in History.
/jlne.ws/3W75oRQ

Commissioner Pham and Commissioner Mersinger to Participate in a Fireside Chat at the Commodity Markets Council’s State of the Industry 2023
CFTC
Commissioner Caroline D. Pham and Commissioner Summer Mersinger will participate in a fireside chat on CFTC Commissioner Priorities at the Commodity Markets Council’s State of the Industry 2023.
/jlne.ws/3X39cVv

Chairman Behnam to Deliver Remarks and Participate in a Fireside Chat at the Commodity Markets Council’s State of the Industry Conference 2023
CFTC
Chairman Rostin Behnam will deliver remarks and participate in a fireside chat at the Commodity Markets Council’s State of the Industry Conference 2023.
/jlne.ws/3iuVf3T

Paul Munter Named Chief Accountant
SEC
The Securities and Exchange Commission today announced that Paul Munter has been appointed Chief Accountant. He has served as Acting Chief Accountant since January 2021.
As Chief Accountant, Mr. Munter will continue to lead the Office of the Chief Accountant (OCA) and serve as the principal advisor to the Commission on accounting and auditing matters. He also will be responsible for assisting the Commission in discharging its oversight of both the Financial Accounting Standards Board (FASB) and the Public Company Accounting Oversight Board (PCAOB).
/jlne.ws/3QyCHfw

SEC Obtains Final Judgment Against Defendant Charged in $43 Million Tribal Bonds Scheme
SEC
On January 10, 2023, the United States District Court for the Southern District of New York entered a final consent judgment against defendant Jason Sugarman, ordering him to pay over $10.2 million dollars in disgorgement, interest, and penalties. The judgment resolves the SEC’s charges against Sugarman for his role in a scheme to defraud ten pension funds out of $43 million in connection with the issuance of limited recourse Native American tribal bonds between 2014 and 2015.
/jlne.ws/3X3dwUQ

Hong Kong to Propose Approved Set of Crypto Tokens for Retail Trading: Reuters
Jamie Crawle – CoinDesk
Hong Kong’s Securities and Futures Commission (SFC) will allow retail trading in a select group of cryptocurrencies as it attempts to introduce regularity clarity to crypto, Reuters reported on Wednesday. The watchdog plans to propose a subset of tokens that will be approved, the CEO of SFC, Julia Leung, said at a panel discussion at the Asian Financial Forum in Hong Kong. Leung said only “highly liquid” assets will be on the list, according to a report by the South China Morning Post.
/jlne.ws/3vXr88k

FCA penalises Al Rayan Bank PLC for anti-money laundering failuresâEUR¯
FCA
Between 1 April 2015 and 30 November 2017, Al Rayan allowed money to pass through the bank and be used within the UK without carrying out appropriate checks. The firm failed to adequately check its customers’ Source of Wealth and Source of Funds when it was required to make sure the money was not connected to financial crime.âEUR¯âEUR¯The failings were made worse by the lack of proper training provided to staff about how to handle large deposits, which further heightened the risk of money laundering and financial crime.âEUR¯âEUR¯
/jlne.ws/3vT2fdJ

Regulator of the Week; Federal Reserve Chairman Jerome Powell wisely rejects the role of climate activist.
James Freeman – The Wall Street Journal
In this era of inflation there’s no shortage of blame due to Federal Reserve Chairman Jerome Powell and his central bank colleagues. But give Mr. Powell credit for realizing that “price stability is the bedrock of a healthy economy” and that his job is to restore that stability-not to inject political agendas into bank supervision.
/jlne.ws/3Gxl5fD

Islamic Bank Fined in U.K. for Anti-Money-Laundering Violations; Al Rayan Bank, a Sharia-compliant bank in the U.K., will pay a $4.9 million fine for failing to adequately monitor the source of its customers’ funds
Dylan Tokar – The Wall Street Journal
Al Rayan Bank, the U.K.’s largest Islamic bank, will pay £4 million, equivalent to about $4.9 million, for failing to maintain sufficient money-laundering protections, regulators said Wednesday. The fine stems from a two-year period during which the bank failed to perform required checks into the source of its customers’ wealth, according to the U.K. Financial Conduct Authority, which brought the regulatory action.
/jlne.ws/3X7y5PY

Lawyers Expect More Anti-Money-Laundering Whistleblowers Thanks to Legislation; Omnibus spending bill recently signed into law overhauls a Treasury whistleblower program that was perceived as ‘all bark and no bite’
Mengqi Sun – The Wall Street Journal
The Treasury Department’s anti-money-laundering whistleblower program, which was established in 2021 but has been viewed as lacking teeth, got a shakeup in the recent omnibus spending bill that lawyers predict will result in more whistleblower cases.
/jlne.ws/3ZsWAbX

Coinbase Layoff Ax Won’t Fall on Compliance Team; A spokeswoman said the company’s large-scale cuts won’t have ‘meaningful’ impact on compliance roles
Richard Vanderford – The Wall Street Journal.
Wide-scale layoffs at Coinbase Global Inc. won’t significantly impact its compliance team, as the cryptocurrency exchange remains under a New York regulator’s watch after recently settling allegations it violated anti-money-laundering laws.
/jlne.ws/3H0TqVy

Investing and Trading

IRS Issues Initial Guidance on Stock Buyback Tax
Sullivan & Cromwell LLP
On December 27, 2022, the IRS and the Department of the Treasury issued Notice 2023-2 (the “Notice”) providing initial guidance on the application of Section 4501 of the Internal Revenue Code, which imposes a 1% excise tax on certain repurchases of corporate stock (such tax, the “Excise Tax”).1 Notable provisions in the Notice include:
/jlne.ws/3GVWEK2

Tiger Woods-Backed SPAC Throws In the Towel as Industry Crumbles
Bailey Lipschultz – Bloomberg
Sports & Health Tech Acquisition Corp., the blank-check firm backed by professional golfer Tiger Woods, dropped its plans for a $150 million initial public offering. The special purpose acquisition company asked to withdraw its registration for an IPO filing Wednesday with the US Securities and Exchange Commission. The firm said last year it was planning to seek a merger target in the sports or health tech sectors with an enterprise value of $600 million to $1 billion.
/jlne.ws/3GV0DXj

Bond Sales Break EUR99 Billion in Europe’s Busiest Week Ever; Borrowers are seizing on a start-of-year credit market rally; The tally beats a EUR98 billion weekly haul set a year ago
Hannah Benjamin and Priscila Azevedo Rocha – Bloomberg
Europe’s debt market is enjoying its busiest week ever, with borrowers issuing EUR99 billion ($107 billion) in just four days as they seize on a start-of-year rally to bring deals early. Italy, Pirelli & C SpA and Deutsche Bank AG are among more than 80 borrowers to raise funds this week, according to data compiled by Bloomberg. The sales haul beats a previous record of more than EUR98 billion euros raised a year ago, when firms clamored to get ahead of rising interest rates.
/jlne.ws/3ZtaoDs

The Global War on Inflation Is Far From Over; In Turkey and Argentina, prices are running wild. And China could be a wild card for the whole world.
Stephanie Flanders and Michael Sasso – Bloomberg
Frustrated by prices at the grocery store? People in countries with advanced economies who have been grousing about single-digit inflation have nothing on Argentina and Turkey. There, inflation is above 90% and 60%, respectively. In the words of one tourist in Buenos Aires, carrying enough cash to pay for a flight leaves one feeling like a bank robber-with a stack of pesos as thick as a brick. With new consumer price data on Thursday, the US is getting a better idea where inflation is headed there. But as it reopens, China remains a wild card for the whole world.
/jlne.ws/3GWN1e6

Environmental, Social and Corporate Governance

New Stock Listings Open The Door To American Investment In The Israeli Occupation; NYSE is partnering with an Israeli exchange, making it easier for Americans to invest in companies supporting Palestinian human rights abuses.
Daniel Boguslaw – The Intercept
In Early December, the New York Stock Exchange signed a memorandum of understanding to begin dual listing securities with its Israeli counterpart, the Tel Aviv Stock Exchange, potentially accelerating U.S. investment in companies tied to illegal West Bank settlements. The move could allow American investors increased access to companies like the construction firm Ashtrom, which is currently listed on the Tel Aviv Stock Exchange and on a 2020 United Nations human rights office database of over 100 companies tied to the expansion of illegal Israeli settlements in the West Bank. To be included in that list, a company had to be engaged in supplying equipment used to destroy Palestinian assets including farmland and property; supplying transportation, utilities, or other support for existing settlements; or aiding in financial backing for settlement expansion or maintenance. Ashtrom, in addition to operating quarries in the West Bank, has helped construct housing in illegal West Bank settlements and prisons and military installments in the occupied territories.
/jlne.ws/3GWgViK

What will the increased financialization of carbon do for decarbonization? Thoughts about what developments like the London Stock Exchange Group’s launch of a new exchange offering for carbon credits portend for the path ahead.
Grant Harrison – Greenbiz.com
A sentence summary to capture voluntary carbon markets’ impact on climate could read: Markets solve some things, not all things. If the North Star of sustainability strategy in finance is (buzzwords aside) catalyzing decarbonization in the real economy, then what do developments like the London Stock Exchange Group’s (LSEG’s) launch of a new offering on the London Stock Exchange for carbon credits portend for the path ahead?
/jlne.ws/3GWYDxS

12Th UN Global Compact-Accenture CEO Study; Reimagining the Agenda: Unlocking the Global Pathways to Resilience, Growth and Sustainability for 2030
UN Global Compact
Get exclusive insights from the world’s largest research initiative on sustainable leadership. As the halfway point to achieving the 2030 Agenda for the Sustainable Development Goals (SDGs) is approaching, global business leaders are calling for more concrete commitments to sustainability, according to the 12th UN Global Compact-Accenture CEO Study. This year’s study draws on insights from more than 2,600 CEOs across 128 countries and 18 industries, including the largest ever sampling of executives from the Global South.
/jlne.ws/3XneMlx

Solactive Acquires Minerva Analytics, The ESG Research, Stewardship Support And Proxy Voting Agency, Further Enhancing Its Leading Position In Sustainable Finance
Mondovisione
Amid a global push towards trustworthy and granular ESG data, rigorous reporting and engagement on sustainability issues by investors, German index provider Solactive is pleased to announce its acquisition of Minerva Analytics, the UK-based stewardship solutions provider. The move follows Solactive’s minority investment in Minerva in May 2019. With increasing regulatory focus on sustainability in Europe, the UK, US and Asia-Pacific, the transaction will enable Solactive and Minerva Analytics to provide their combined global client base of more than 500 entities with proxy voting and stewardship oversight services as well as ESG indices, benchmarks, research and data. As both indexed and systematic asset management firms face escalating calls from investors to actively vote and engage with portfolio companies, Minerva’s solutions are a natural addition to Solactive’s existing services.
/jlne.ws/3XcBi0Y

ESG Watch: Why this year could be a watershed moment for investors on nature-related risk
Mike Scott – Reuters
Environmental, social and governance (ESG) issues were central to many of the biggest stories of 2022. Indeed, ESG investors frequently found themselves the story, particularly in the U.S., where figures such as Florida governor Ron DeSantis, as well as other states such as Texas and West Virginia, accused asset managers of pursuing ideological goals through their use of ESG to assess risks. As index provider MSCI points out, regulators around the world have upped the ante “on everything from greenwashed fund names, to stricter climate target disclosures, while the very idea of ESG investing is increasingly politicised”.
/jlne.ws/3IEMjUh

Assembling the Pieces of the Carbon Pricing Puzzle; Progress was made on the EU ETS, ETS 2 and CBAM in December, but many questions remain unanswered.
Emmy Hawker – ESG investor
Carbon pricing has long been thought of as one of the most effective ways to migrate economies away from fossil fuel dependence to achieve net zero and limit global warming to 1.5°C. In December, the European Commission, Council and Parliament reached consensus on the reform of its Emissions Trading System (ETS), the development of a separate system for other industries (ETS 2), and the introduction of the Carbon Border Adjustment Mechanism (CBAM), which has the potential to globalise Europe’s carbon pricing regime.
/jlne.ws/3iywKCW

Disentangling India’s new national carbon market
LSE Commentary
Kamya Choudhary and Rob Macquarie discuss how certain design features of India’s new carbon market pose risks to effective decarbonisation and suggest how policymakers can overcome these issues. Carbon markets can help to reduce greenhouse gas emissions by combining a price on carbon and tradeable certificates to incentivise low-carbon investment. They come in many forms, depending on who participates and how money and credits change hands – including voluntary or mandatory (also known as ‘compliance’), and national or international.
/jlne.ws/3IIcedy

Institutions

R.J. O’Brien Promotes Heather Rucci to Chief Strategy Officer
R.J. O’Brien & Associates
Chicago-based R.J. O’Brien & Associates (RJO), the oldest and largest independent futures brokerage and clearing firm in the United States, today announced the promotion of Heather Rucci to Chief Strategy Officer. Rucci, who has served as the firm’s Chief Human Resources Officer since July 2021, will retain oversight of the global human resources (HR) function. In her new role, Rucci will work across the firm’s core businesses, departments and geographies to oversee long-term planning, ensuring alignment on strategic priorities, partnering with leaders on the appropriate deployment of resources, and streamlining global processes and procedures.
/jlne.ws/3wgKqpv

BlackRock plans to cut 500 workers after last year’s market downturn
Alexandra Semenova – Yahoo! Finance
BlackRock (BLK), the world’s largest asset manager, will lay off about 500 employees – or roughly 3% of its workforce – according to an internal email seen by Yahoo Finance. The investment giant joins a growing number of Wall Street firms trimming their headcount after last year’s market rout and as Corporate America ramps up hiring freezes and job cuts. “This week, after meaningful headcount growth in recent years, we are making some changes to the size and shape of our workforce,” CEO Larry Fink and BlackRock president Rob Kapito said in a memo sent to staff on Wednesday.
/jlne.ws/3X8cHKw

Tidal plans to convert separately managed account into an ETF; White-label ETF issuer executive expects huge growth in SMA conversions
Beagan Wilcox Volz – Financial Times
Tidal Financial Group, the white-label ETF issuer, plans to guide a separately managed account through the complex process of converting to an actively managed transparent ETF, a regulatory filing shows.
/jlne.ws/3QANFRQ

JPMorgan claims entrepreneur Charlie Javice duped bank into buying $175M startup: suit
Ariel Zilber – NY Post
JPMorgan Chase claims it was duped by a 30-year-old entrepreneur who lied about the number of college kids who were using Frank – a financial-planning site that the mega-bank bought for $175 million. JPMorgan Chase alleges that Charlie Javice, who was featured on the Forbes “30 under 30” list in finance for 2019, led the bank to believe that Frank “was a business deeply engaged with the college-aged market segment with 4.265 million customers,” according to a lawsuit filed on Dec. 22, read.
/jlne.ws/3kd01Ud

BNP Paribas continues US expansion plans with new Miami office; New hub will support the growth of the firm’s global markets business in the US and the growing number of clients within the South Florida area.
Wesley Bray – The Trade
BNP Paribas Securities Corp has announced plans to continue its expansion into the US with the opening of a new office in the metro-Miami area. The Miami office, due to be open for business in the fourth quarter of this year, will support the growth of the firm’s global markets business in the US and the growing number of clients within the South Florida area.
/jlne.ws/3GWmg9N

Work & Management

Microsoft Says It Will Give US Workers Unlimited Time Off
Dina Bass – Bloomberg
Microsoft Corp. said it is shifting vacation policy to give US workers unlimited time off, matching a system already in place at its LinkedIn unit. The changes start Jan. 16 and apply only to full-time employees in the US, according to a company spokesperson. The company has been considering the change for a few years in order to adapt to more flexible working schedules.
/jlne.ws/3irwaXD

Meta and Apple Fall Off Glassdoor’s List of Best Places to Work; Even as layoffs ripple through the industry, tech companies dominate the list.
Jo Constantz – Bloomberg
Glassdoor’s list of 100 best places to work in 2023 is dominated by tech companies, but this year two regular winners didn’t make the cut: Apple and Meta. Over 40% of the companies on this year’s list are in the tech industry – despite waves of layoffs. Glassdoor, a platform for anonymous employer reviews, releases the annual list recognizing standouts among US firms with more than 1,000 people based on feedback submitted by employees over the past year. Last year, Meta and Apple both came in around the middle of the top 100. The best company to work for is a new addition to the ranking: software company Gainsight.
/jlne.ws/3CINJcw

Climate Data Startups Take Science Off Campus and Into Boardrooms; Investors are turning to a new wave of climate science and analytics companies to manage risk and find opportunities.
Eric Roston – Bloomberg
A chemist at Stockholm University first scrawled out equations describing the greenhouse effect in 1896. Since then climate science has steadily advanced largely at research institutions and government agencies. They were the only places with the expertise, interest and budgets to fund research into geophysics and, later, computer models that simulated climatic changes.
/jlne.ws/3QvSrA9

Goldman Sachs makes ‘brutal’ job cuts in quest for lower costs; Group pays some bankers no bonus for last year’s work while giving others 30 minutes to leave
Joshua Franklin and Ortenca Aliaj, Stephen Morris – Financial Times
Goldman Sachs on Wednesday sacked bankers at its offices in cities from New York and London to Hong Kong, dismissing many employees without paying a bonus for work performed last year while giving some junior bankers 30 minutes to gather their belongings and leave.
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Mouse Jigglers, Fake PowerPoints: Workers Foil Bosses’ Surveillance Attempts; Companies that track employees’ productivity run up against their inventive workarounds
Douglas Belkin and Lindsay Ellis – The Wall Street Journal
In a time of hybrid work, employers are extra-focused on making sure their staffers are being productive. Now come employees with work hacks to keep the bosses off their tails. Lisa Crawford works in marketing from her home in Phoenix. She says she is wary of her computer falling asleep when she gets up to throw in a load of laundry or prep ingredients for dinner. She might miss the ping of an email from a supervisor and be slow to reply.
/jlne.ws/3X5SS6C

Good Leadership Is About Asking Good Questions
John Hagel III – Harvard Business Review
Especially when they find themselves in the midst of crisis and uncertainty, leaders should ask powerful and inspiring questions. Asking questions well can put you on the path to solving intractable problems and will also help you connect with others and, counterintuitively, to earn their trust. Those questions should be big in scope: What new opportunities have emerged that we don’t want to miss? How might we use new technologies to change our business model? And you should involve others in answering those questions -employees, stakeholders, and even customers. Doing so can not only help you generate better answers, it can also help you to change your organization’s culture.
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Wellness Exchange

How Deadly Were the Covid Lockdowns? For Americans under 45, there were more excess deaths without the virus in 2020-21 than with it.
Rob Arnott and Casey B. Mulligan – The Wall Street Journal
Covid-19 is deadly, but so were the draconian steps taken to mitigate it. During the first two years of the pandemic, “excess deaths”-the death toll above the historical trend-markedly exceeded the number of deaths attributed to Covid. In a paper we just published in Inquiry, based on data from the Centers for Disease Control and Prevention, we found that “non-Covid excess deaths” totaled nearly 100,000 a year in 2020 and 2021.
/jlne.ws/3Zy8Dok

Regions

China Moves to Repair Ties With Australia by Lifting Coal Ban; Officials in Guangdong province get go-ahead to clear coal cargoes as Beijing adopts less confrontational policy
Rhiannon Hoyle in Adelaide, Australia, and Keith Zhai and Sha Hua in Singapore – The Wall Street Journal
China effectively ended a ban on Australian coal that has been a centerpiece of a diplomatic dispute lasting more than two years, in the latest indication that Beijing is taking a less confrontational approach in its foreign policy as the economy struggles. Customs officials in the southern province of Guangdong on Thursday received notice from the local government that they can clear Australian coal shipments, two people familiar with the situation said. The move comes about a week after the country’s national planning agency permitted a group of large state-owned companies to buy Australian coal again.
/jlne.ws/3iBcel5

Record India Wheat Crop Will Pave Way for Easing of Export Curbs
Pratik Parija – Bloomberg
India is set to harvest a record wheat crop this season as favorable weather and heat-resistant seeds are expected to boost yields, potentially setting the stage for the country to lift restrictions on exports.
/jlne.ws/3XgL5Tc

Swedish Miner Finds Europe’s Largest Rare Earth Deposit; Deposit holds more than 1 million tons of rare minerals; Application for exploration concession expected in 2023
Jonas Ekblom – Bloomberg
The largest known deposit of rare earth minerals in Europe has just been discovered in Sweden’s Arctic, with potential to help the continent break free from China’s dominance on the market for the resources. The deposit, found by Swedish state-owned mining company LKAB, contains more than 1 million tons of rare earths, according to a statement on Thursday. Work is still in an exploratory phase and the full extent of the deposit, just north of the company’s biggest mine in the Arctic town of Kiruna, is not known, LKAB said.
/jlne.ws/3GAFu3s

New Mortgage Trap Opens in Poland as Banks Lock in Peak Rates; BNP and ING are dropping once dominant floating-rate loans; Financing costs expected to decline as inflation surge eases Konrad Krasuski – Bloomberg
Two Polish banks have suspended the sale of floating-rate mortgages, effectively locking in peak rates in a fresh challenge for the country’s home owners. BNP Paribas Bank Polska SA, the sixth-biggest lender by assets, announced a “temporary halt” on variable-rate home loans this week, and will instead only sell mortgages with rates fixed for five or 10 years. ING Bank Slaski SA, Poland’s No. 4 bank, made a similar move in December.
/jlne.ws/3k5HAk9

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