Hits & Takes
By JLN Staff
Did you know the CME Group offers a tool to show the latest probabilities of expected outcomes of the OPEC meeting? Yes, they do. The “CME OPEC Watch Tool” is the place to stay in tune with OPEC-related outcomes.~JJL
Where is the countdown to bitcoin option trading at the CME Group? ~JJL
Have you ever seen the bitcoin trading on SeedCX? The time and sales on their site show all 1 and 2 lots trading. Nothing bigger. Funny, I thought institutional trading was supposed to be bigger than that.~JJL
Scott Williamson, a member of the CFTC’s enforcement division, recently received the prestigious Yale Medal for his extensive and exemplary contributions to his alma mater.~JJL
Chris Hehmeyer was interviewed by the FIA for MarketVoice in a story titled “Balancing blockchain’s big potential with its big risks.”~JJL
The CFTC has finally issued the comments that Chairman Heath Tarbert made at the FIA EXPO in Chicago on October 30 in written form. Originally they just said the comments were available via video. I wonder if there is a rule about comments needing to be in written form for the official record?~JJL
We have a story in our ‘Crypto’ section today about David Marcus, head of the Libra Association, and his ongoing quest to make Libra’s launch compliant, and with as many large corporations behind it as possible. Just keep in mind while you’re reading – the Libra Association was created by Facebook, and Libra’s launch benefits Facebook. While Marcus may be doing what he does for good reasons, perhaps the same cannot be said about Facebook, given all we’ve learned over the past few years.~MR
Today at 1 PM Chicago time we are publishing the next video from the Open Outcry Traders History Project, this one of Dan Stern. Dan is a member of a prominent Chicago Board of Trade family. His father Lee Stern is perhaps the oldest and longest-tenured member of the CBOT. Look for it on the www.johnlothiannews.com website.~JJL
Cloud-based collateral management’s profound impact on the financial industry: CloudMargin’s Karl Wyborn
CloudMargin’s Karl Wyborn, the London-based company’s newly appointed global head of business development, sat down with John Lothian News at FIA Expo 2019 to explain how the deployment of cloud technology has begun to change the industry – enabling institutions to knit together collateral management solutions to create a “best of breed” approach that previously had been difficult to execute.
CQG Names Benjamin Soong President, APAC and Rick Chang Head of Greater China; Rod Giffen Assumes New Role of Chief Experience Officer as Firm Evolves into Solutions Provider
CQG, a leading global provider of high-performance technology solutions for traders, brokers, commercial hedgers, and exchanges, announced that Benjamin Soong has joined the firm as President, APAC, and Rick Chang as Head of Greater China. Rod Giffen, who has served most recently as CQG President, APAC, has assumed the new role of Chief Experience Officer (CXO).
*****I thought the CXO was the chief hugs and kisses officer.~JJL
Half of derivatives brokerages considering new front-office software provider
Strong growth environment for vendors with the right platforms as brokers consider new suppliers and sell-side ends vendor reduction programmes, Acuiti study finds.
*****The latest from Will Mitting and Acuiti.~JJL
Google Founders Give Up on Being the Warren Buffett of Tech
Mark Bergen and Alistair Barr – Bloomberg
Alphabet’s hands-off approach unwound as Google CEO takes over; Moonshot projects are sucked back into Google’s orbit
The Google founders’ decision to step down ends a multiyear effort to turn their company into the Berkshire Hathaway of technology by embracing Warren Buffett’s hands-off management style.
***** A good idea gone bad by over-managing or under-managing?~JJL
Fostering a “true culture of compliance”
Four (plus one) Takeaways from the CFTC Annual Enforcement Report
Eventus Systems blog
In its annual report for fiscal year 2019, the CFTC Division of Enforcement (‘DofE’) described activity that is well in line with recent trends but also hammered home its intent to be tough on wrongdoers as the Commission continues striving to create a culture of compliance among industry participants. While there was a slight dip in the total number of cases brought, other areas saw an increase, most notably in the number of instances of cooperation between the agency and other regulators or criminal authorities.
***** Eventus with a review of the CFTC Annual Enforcement Report.~JJL
Ceres Cafe, Destroyer of Careers; Of all the Chicagoans who’ve suffered the Board of Trade bar’s hangovers, Eddie Johnson’s may be the most permanent.
Kate Bernot – Chicago Magazine
Ceres Cafe is not a place you drink when you have subsequent commitments. The cocktails are not merely strong, but something approaching navy strength. The bar’s sparsely windowed space inside the Chicago Board of Trade Building has a casino-like effect, its constant chatter and TVs dialed to forgettable channels creating a warped, stupefying sense of time’s passage. Chicken pot pie, turkey meatloaf, and patty melts sit heavy in the gut. All in all, Ceres is a gin-soaked lullaby.
****There is no truer story.~JJL
Tuesday’s Top Three
Our most read story on Tuesday was The Chicago Tribune’s Mayor Lori Lightfoot fires Chicago’s police superintendent weeks before his retirement: ‘Eddie Johnson intentionally lied to me’, in which the superintendent had a few too many heavy pours at Ceres Cafe. Second was John Lothian News’ Alan Palmer – Open Outcry Traders History Project video interview. And third was Forbes’ Former CFTC Boss Says Vatican Letter Prepared Him To Be ‘Crypto Dad’, about Chris Giancarlo, who was also the MarketsWiki Page of the Day yesterday.
168,790,698 pages viewed; 23,993 pages; 222,578 edits
|CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.Recently Updated Pages
1,306 pages; 11,589 edits
London Startup Aims to Bring Bond Sales Closer to Automation
Katie Linsell – Bloomberg
A fintech venture backed by some of the largest U.K. law firms and London Stock Exchange Group Plc has launched a product to digitize key parts of an archaic process of selling new bonds. The system, developed by London-based Nivaura, brings negotiation of the fine print in bond terms online so that legal documents can be drafted and signed digitally, according to a statement seen by Bloomberg News. It aims to speed up bond sales and potentially do away with laborious processes of submitting data by hand at banks, law firms and clearing houses.
Crypto Funds Are Closing While the Biggest Investors Stand Aside
Olga Kharif – Bloomberg
Almost 70 funds have closed in 2019, Crypto Fund Research says; Fidelity, futures exchanges continue to court professionals
“Just wait until institutional investors jump in” has long been a rallying call for the cryptocurrency faithful.
TFS-ICAP’S CEO Ian Dibb seeks to dismiss CFTC allegations
According to Dibb, the CFTC’s complaint fails to prove collusive or anti-competitive conduct, risk negation, and anti-competitive intent.
How to reform today’s rigged capitalism; We must address weakened competition, feeble productivity growth, high inequality and degraded democracy
Martin Wolf – FT
“It is clear then that?.?.?.?those states in which the middle element is large, and stronger if possible than the other two [wealthy and poor] together, or at any rate stronger than either of them alone, have every chance of having a well-run constitution.” Thus did Aristotle summarise his analysis of the Greek city states. The stability of what we would now call “constitutional democracy” depended on the size of its middle class. It is no accident that the US and UK, long-stable democracies today succumbing to demagogy, are the most unequal of the western high-income countries. Aristotle, we are learning, was right. (See charts.)
Wall Street firms rank data analysis far above relationship building when picking the must-have skills for future traders
Dan DeFrancesco – Business Insider
A recent survey conducted by Greenwich Associates of people at a variety of Wall Street firms found data analysis is believed to be the most important skill for the trading desk of the future; Meanwhile, “relationship management” and “economic knowledge” were on the other end of the spectrum, garnering only 38% and 23% of responses, respectively; Finding investment opportunities was the top choice among what will be the most useful insights from analytic tools in the future.
Hopeful traders of the world, be warned: It is no longer about who you know but, instead, what you know. When asked about the most important skills needed to work on a trading desk in the future, a vast majority of respondents pointed to analyzing data.
EEX Trading Results in November: Double digit growth in French, Spanish and CSEE Power
In November 2019, the European Energy Exchange (EEX) increased volumes on the Power Derivatives Market by 5% to 366.7 TWh compared to the previous year (November 2018: 349.5 TWh). Significant growth was achieved in power futures for France (48.1 TWh, +35%) and Spain (15.7 TWh, +40%) as well as in Central and Southeastern European power
Top U.S. stockpickers keep low profile
David Randall – Reuters
The co-managers of the best
stock mutual fund of this decade work out of a small office in Los Angeles, rarely talk with the financial media and have never appeared as guests on CNBC looking to raise their profile.
Farmer sentiment jumps up in November as harvest winds down
CME Group (news release)
Agricultural economy sentiment tied with its highest reading of 2019, according to the November Purdue University/CME Group Ag Economy Barometer. Rising for a second month in a row, the barometer improved to a reading of 153 in November, up 17 points from October and matching the previous high set in July.
Homebody in a Hoodie: Hedge Fund Founder Builds Quant Paradise
Steven Schonfeld’s firm has gained about 20% a year since 2014; Billionaire completes $111 million deal for Palm Beach estate
Steven Schonfeld is a hedge fund billionaire of a different breed. He’s almost always in a hoodie, drawn from a closet full of them. He shuns the Wall Street crowd. You’ll never see him at a gala in Manhattan or at Davos or Aspen. Mostly he stays home in Old Westbury, New York.
GAM accused of accounting ‘misstatement’ by Swiss bourse; Exchange says it found ‘deficiencies’ in treatment of hedge fund acquisition
Adam Samson – FT
GAM has been accused by the Swiss stock exchange of a “potentially material misstatement” in its accounting for its ill-fated purchase of a UK hedge fund in the latest blow to the asset manager.
Don’t Blame the ECB for Negative Rates; Christine Lagarde needs to stand her ground until the euro zone’s governments start using fiscal policy properly.
Ferdinando Giugliano – Bloomberg
The European Central Bank has infuriated bankers because of its policy of negative interest rates. It now looks like some euro zone governments are unhappy too.
CFTC amends Part 4 rules notwithstanding Commissioner Berkovitz’s dissent regarding registration exemption for family offices
Brad Rosen, J.D. – Jim Hamilton’s Blog
With an eye towards streamlining and simplifying requirements for asset managers, the CFTC voted to approve amendments to its Part 4 regulations at an open meeting during the final week of November 2019. According to CFTC Chairman Heath Tarbert, each amendment was designed to advance the Commission’s strategic goal of “encouraging innovation and enhancing the regulatory experience for market participants at home and abroad.” He also stated that amendments to Part 4 will improve harmonization for market participants subject to concurrent CFTC and SEC jurisdiction.
Directorate Changes: Steve Sparke joins KRM22 as non-executive director – KRM22
KRM22 plc, (AIM: KRM) the technology and software investment company that focuses on risk management for capital markets, today announces the appointment of Steve Sparke as a Non-Executive Director of the Company. Mr Sparke will replace Matt Reed, Independent Non-Executive Director, who is stepping down to focus on other business commitments.
Industry warned as regulators fail to provide feedback on MiFID II transaction reporting; Firms are at risk of fines for MiFID II transaction reporting failures, as almost 70% state they have received no feedback at all from regulators on submissions.
Hayley McDowell – The Trade
European regulators are failing to provide feedback to most market participants on the quality of transaction reports submitted under MiFID II, almost two years after the rules were implemented.
Ray Dalio Is More Famous Than Ever and Delivering Subpar Returns
Katherine Burton and Melissa Karsh – Bloomberg
Billionaire’s recent book has sold more than 2 million copies; His macro fund is down about 2% this year, trails some rivals
The biggest hedge fund in the macro game, a $40 billion beast, is looking a lot like an also-ran.
US Federal Regulators Issue Joint Statement On The Use Of Alternative Data In Credit Underwriting
Five Federal financial regulatory agencies today issued a joint statement on the use of alternative data in underwriting by banks, credit unions, and non-bank financial firms. The statement from the Federal Reserve Board (Federal Reserve), the Consumer Financial Protection Bureau (CFPB), the Federal Deposit Insurance Corporation (FDIC), the Office of the Comptroller of the Currency (OCC), and the National Credit Union Administration (NCUA) notes the benefits that using alternative data may provide to consumers, such as expanding access to credit and enabling consumers to obtain additional products and more favorable pricing and terms. The statement explains that a well-designed compliance management program provides for a thorough analysis of relevant consumer protection laws and regulations to ensure firms understand the opportunities, risks, and compliance requirements before using alternative data.
Exchanges, OTC and Clearing
The World Federation of Exchanges Launches Workplan to Drive Greater Understanding Around CCPs & Their Role in Systemic Safety
The World Federation of Exchanges (“WFE”), the global industry group for central counterparties (“CCPs”) and exchanges, has said it is starting a 12-month workplan to ensure that the role and nature of CCPs is correctly understood, and is not undermined by narrow interests that diverge from good public policy.
In doing so, the WFE will engage with all stakeholders, while continuing to promote the principles that first made the CCP model the trusted approach to counterparty credit issues. The WFE programme will take a comprehensive, first-principles look at all relevant questions, including the rationale for CCPs in the financial system and society. It will factor in research that has been produced in this area, while avoiding a selective or one-sided approach.
Announcement of T7 Release 8.1
Deutsche Börse AG plans to introduce T7 Release 8.1 on 29 June 2020. The simulation period for T7 Release 8.1 is planned to start on 4 May 2020.
Eurex Pricing Roadmap 2020
Eurex Exchange hereby announces the first elements of the Eurex Pricing Roadmap 2020 and provides further information on changes as well as the corresponding amendments to the Price List of Eurex Clearing AG (Price List) with respect to the following measures:
St. Nicholas Day: Trading Charity on the Frankfurt Stock Exchange; Remunerations on December 6th will be donated to nonprofit organizations / Donation will take place on December 12th in the stock exchange hall
Deutsche Börse and the securities trading banks operating as specialists on the Frankfurt Stock Exchange Parquet will donate the transaction and trading fees, which will be taken on the Frankfurt Stock Exchange (December 6) via the Frankfurt Stock Exchange , to non-profit organizations. The donations will be handed over to the four clubs on December 12 at 9:00 am in the Frankfurt Stock Exchange.
Intercontinental Exchange Announces Record Daily Trading Volume for New York Harbor Heating Oil Futures
Intercontinental Exchange, Inc. (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, today announced record trading volume for ICE New York Harbor Heating Oil Futures of 113,770 contracts yesterday. This was a 35 percent increase over the previous trading volume record of 84,294 lots on October 17, 2019.
Opening remarks by Tan Boon Gin, CEO of SGX RegCo, at the launch of the SGX-CGIO’s “Review of Singapore-Listed Issuers’ Sustainability Reports 2019”
Good morning Mr Masagos Zulkifli, Minister for the Environment and Water Resources
Almost all SGX-listed companies produce sustainability reports since mandate
Singapore Exchange Regulation (SGX RegCo) and the Centre for Governance, Institutions and Organisations (CGIO) at the National University of Singapore (NUS) Business School, today said their joint review showed that almost all listed companies have produced their sustainability reports on a timely basis following the mandating of the requirement.
Nasdaq Helsinki: Warning And Fine Imposed To Pihlajalinna Plc For Breaching The Rules Of The Exchange
The Disciplinary Committee of Nasdaq Helsinki Ltd has imposed a warning and a fine of EUR 75,000 to Pihlajalinna Plc (trading code: PIHLIS) due to the breaches of the Rules of the Stock Exchange (the “Rules”) of Nasdaq Helsinki Ltd (“the Exchange”). Pihlajalinna Plc (“the Company”) breached the Rules on the timing and content of the disclosure of inside information when announcing a co-operation agreement on June 3, 2019. Furthermore, the Company breached the Rules on organizing the administration of the listed company.
Pimco adopts OpenGamma analytics for uncleared margin rules; Pimco will use OpenGamma’s technology in a bid to reduce margin financing costs for derivatives trading.
Hayley McDowell – The Trade
Fixed income investment firm Pimco has implemented technology and analytics from OpenGamma in a bid to optimise derivatives margin processes for clients.
Citi integrates Rapid Addition platforms to boost electronic currency trading; Citi has deployed Rapid Addition’s Hub and FIX engine to bolster pricing technology for clients in London, Tokyo, New York and Singapore.
Hayley McDowell – The Trade
US investment bank Citi has integrated two systems from trading platform provider Rapid Addition to support its growth in market share of FX electronic trading.
Opening Quote: Fintech Zopa has valuation slashed; Your morning City briefing on companies in the news, job moves and what’s happening in the markets
Cat Rutter Pooley – FT
Has the fintech bubble burst for the peer-to-peer lenders? Not quite, but it has certainly deflated. High profile UK fintech Zopa on Tuesday completed a last-minute fundraising to salvage its efforts to fully launch its bank, raising £140m from US investor IAG Capital. That money came at a cost to existing investors, however, as results from listed fintech investment fund Augmentum Fintech show on Wednesday morning.
McKay Brothers Adds Market Data Distribution in Mumbai at the Lowest Known Latency; UK and US-sourced futures market data available at Mumbai’s BKC data center
McKay Brothers International (MBI) announced an expansion of its lowest known latency market data services to India. The Quincy Extreme Data (QED) service now distributes select London Metals Exchange data at Mumbai’s Banda Kurla Complex (BKC) in less than 51milliseconds one-way. In addition, MBI offers select Aurora, Illinois-sourced Metals, Energy, and FX futures data at BKC in less than 85 milliseconds one-way, the lowest known commercial latency.
DriveWealth Teams with Stockal, HDFC Securities to Make U.S. Stock Investing Straightforward, Affordable for Indian Investors
DriveWealth, LLC, a U.S. based leader in global digital trading technology, today announced it has partnered with SV Capital in India to enable fintech firm Stockal and HDFC Securities – one of the largest stock brokerage firms in India – to increase accessibility to the U.S. stock market for Indian investors. Through this arrangement, Stockal – which has launched its global investment platform for Indian investors – and HDFC Securities will utilize DriveWealth technology and brokerage execution services to offer their clients easy access to U.S. stocks, including in the form of fractional shares that DriveWealth has pioneered.
Goldman Sachs to launch new products and services on Amazon’s cloud
Goldman Sachs Group Inc will be launching new technology-based products and services for its institutional clients on Amazon’s cloud next year, bank Chief Executive David Solomon said at a conference on Tuesday.
Winklevoss crypto-exchange hires Starling Bank co-founder; The UK executive will spearhead the exchange’s push into Europe
Cat Rutter Pooley – FT
The cryptocurrency exchange set up by Cameron and Tyler Winklevoss has hired the co-founder of UK digital bank Starling to kick-start a European expansion, even as the fever over digital currencies cools.
Lone Analyst Drops Hive, Marking Fall of Former Crypto Star
Natalie Obiko Pearson – Bloomberg
Cryptominer no longer meets coverage criteria: PI Financial; Mining magnate Giustra’s backing helped stock surge 2,000%
Hive Blockchain Technologies Ltd. was an overnight stock sensation when it became the first cryptominer in the world to trade publicly. Two years later, abandoned by the last analyst covering it, Hive joins the list of flame-outs on Canada’s junior stock exchange.
Bitcoin is boring now
Matthew De Silva – Quartz
Bitcoin is in a funk. For the last two months, the leading cryptocurrency has remained within a narrow band, fluctuating between $7,000 and $9,000. On occasion, it has creeped higher or lower, but never for long.
British Virgin Islands, Home to Crypto Expats, to Issue Own Coin
Olga Kharif – Bloomberg
British Virgin Islands, home to cryptocurrency companies such as Tether and Bitfinex, is planning to release its own national cryptocurrency. The British Overseas Territory, which consists of more than 50 Caribbean islands, has relied on the U.S. dollar since 1959. But it’s planning to create a token pegged one-to-one to the greenback for use within its territory. In creating its own coin, it’s following countries such as the Marshall Islands.
David Marcus, Facebook’s Libra Defender
Kurt Wagner – Bloomberg
David Marcus removed his tie, undid the top two buttons of his shirt, and ordered a bourbon. It had been a long week. Five days earlier, on Oct. 11, Marcus, the executive leading Facebook’s ambitious and controversial foray into cryptocurrencies, had listened as a handful of high-profile partners he’d helped recruit to the project—including Visa, Mastercard, and Stripe—called to say they were dropping out. Then, three days after that, hours before the group was to sign its charter and elect a board of directors to oversee the currency, news broke of another.
Binance adding support for tezos staking at zero fee
Yogita Khatri – The Block Crypto
Cryptocurrency exchange Binance is adding support for tezos (XTZ) token staking, starting Dec. 4. Announced Tuesday, Binance said it will not charge any fee for the staking service. Coinbase and Gate.io exchanges, on the other hand, charge 25% and 33%, respectively, for their XTZ staking services.
Zcash Foundation Funds App Mixing Private Messaging and Payments
Leigh Cuen – Coindesk
The Canadian nonprofit Open Privacy is working on Cwtch, a zcash-fueled messaging app with more decentralization than Telegram or Signal. “Cwtch is focused on building a decentralized infrastructure,” said Open Privacy founder Sarah Jamie Lewis. “It can’t be reliant on Visa or Venmo unless we can find a way to remove that metadata.” The project is still in an early stage of messaging between roughly a dozen node and server operators. Now, thanks to a donation from the Zcash Foundation of roughly $40,000, the nonprofit will hire a designer and continue research on the payment aspects of the system.
Online Lender SoFi Gets NY BitLicense, Clearing Way to Offer Crypto Trading
Nikhilesh De – Coindesk
Student loan and financial services provider SoFi has secured a New York virtual currency license, the state’s financial regulator announced Tuesday. The New York Department of Financial Services said in a press release that it approved SoFi Digital Assets, a wholly owned subsidiary of SoFi, granting it a money transmission license as well as the virtual currency license, colloquially termed the BitLicense. SoFi Digital Assets is the 24th company to receive a cryptocurrency approval through NYDFS.
Bitcoin No Longer Looks Like ‘Digital Gold’ by One Measure
Sebastian Sinclair – Coindesk
If “digital gold” means “a safe-haven asset where investors park their money during financial market turmoil,” then bitcoin doesn’t fit the bill as well as it used to. For most of the year, bitcoin’s price showed a modestly negative correlation with the S&P 500. In other words, the world’s largest cryptocurrency by market capitalization tended to rise on days when the bellwether stock-market index fell, and vice versa. But since early October, that relationship has weakened, according to information provided by Digital Assets Data.
Australian authorities seize record $1M worth of crypto in drug probe
Yogita Khatri – The Block
The Western Australia Police Force has seized record AU$1.52 million (~US$1 million) worth of cryptocurrency in a drug probe. The police have arrested a 27-year-old man and a 25-year-old woman in the case, Australian Border Force (ABF) announced Wednesday. The man and the woman are alleged to have imported 27.5g of MDMA drug tablets and 27.5g of MDMA powder from the U.K., concealed in a children’s toy painting kit.
Bitfinex ties up with Bitrefill to allow users to shop with bitcoin and pay with Lightning Network
Yogita Khatri – The Block Crypto
Crypto exchange Bitfinex has partnered with crypto gift cards provider Bitrefill to allow users to shop with bitcoin and pay with the Lightning Network. The gift cards include several categories, including dining, entertainment (e.g. Netflix), and travel. John Carvalho, chief communications officer at Bitrefill, told The Block: “We intend to onboard other players to Lightning and shopping features in Q1 2020.”
Can Tokenization Revolutionize Alternative Investing?
The rise of cryptocurrencies such as bitcoin and ethereum has sparked a host of innovative activity. Numerous companies have cashed in on the trend by issuing their own digital currencies and tokens.
State Street Slashes DLT Developer Team as Bank Rethinks Blockchain Strategy
Ian Allison – Coindesk
State Street, the global custodian bank, has taken a new direction with its blockchain strategy and cut scores of developer jobs in the process, people familiar with the situation said.
Political climate influences students’ choice of business school; European business schools’ efforts to attract international students pay off
Ian Wylie – FT
European business schools have long welcomed student cohorts that are diverse and highly international. Yet with populist parties, nationalist leaders and inward-looking policies on the rise in many parts of the world — including Europe — seemingly hostile student-visa and work permit regimes can deter even the keenest potential candidates.
House impeachment report concludes Trump abused his office; Democrats detail their conclusions as they push ahead into next phase of inquiry
Demetri Sevastopulo and Lauren Fedor – FT
House Democrats accused Donald Trump of abusing his office for political gain and trying to obstruct the Ukrainegate investigation, in a highly anticipated report that paves the way for articles of impeachment and a trial in the Senate.
Trump, Who Can’t Stop Tweeting About Stock Market: ‘I Don’t Watch The Stock Market’
Amy Russo – HuffPost
President Donald Trump, who has tweeted about the stock market more than 100 times, claimed Tuesday that he pays no attention to it. “If the stock market goes up or down ? I don’t watch the stock market,” Trump said in London, where he is attending a NATO summit. “I watch jobs. Jobs are what I watch.”
Factbox: Trump has upended relationships with nine of 10 top U.S. trading partners
During his election campaign in 2016, U.S. President Donald Trump promised to shake up global trade and bring down America’s growing trade deficits. Now relationships with all but one of the United States’ top ten 2018 trading partners has been thrown into uncertainty, and there is no clear roadmap for when new trade agreements may be finalized.
Wait Until Donald Trump Hears About the Carbon Border Tax; The climate crisis and trade conflicts are two of the world’s biggest challenges and they might be about to collide in the EU’s green deal.
Chris Bryant – Bloomberg
Next week, the European Union’s leaders will commit to cutting net greenhouse gas emissions to zero by 2050. This historic pledge will require the continent to radically overhaul its entire economy, including a revolution in the production of steel, cement and chemicals — whose carbon emissions are particularly difficult to abate.
ESMA Updates AIFMD Q&A
The European Securities and Markets Authority (ESMA) has today updated its Questions and Answers on the application of the Alternative Investment Fund Managers Directive (AIFMD)
ESMA appoints Robert Ophèle as the Acting Chair of its CCP Supervisory Committee
The Board of Supervisors of the European Securities and Markets Authority (ESMA) has appointed Robert Ophèle, the Chair of the Autorité des Marchés Financiers (AMF) of France, as the Acting Chair of ESMA’s Central Counterparty (CCP) Supervisory Committee.
ESMA Updates Its Q&AS Relating to the Prospectus Regulation
The European Securities and Markets Authority (ESMA) has today updated its Questions and Answers on the Prospectus Regulation with two new Q&As.
ESMA updates Q&AS on MiFID II and MiFIR investor protection and intermediaries
The European Securities and Markets Authority (ESMA) has today updated its Questions and Answers on the implementation of investor protection topics under the Market in Financial Instruments Directive and Regulation (MiFID II/ MiFIR). The update includes Q&As on costs and charges and product intervention
CFTC to Hold an Open Commission Meeting on December 10
U.S. Commodity Futures Trading Commission Chairman Heath P. Tarbert today announced the CFTC will hold an open meeting on Tuesday, December 10, 2019, at 9:00 a.m. EST at its headquarters in Washington, DC to consider the following:
Rule Submission: National Futures Association: Reduction in Forex Dealer Member
Assessment on Each Order Segment Fee Submitted to NFA’s Forex
Transaction Reporting Execution Surveillance System – NFA Bylaw
1301(e) and NFA Interpretive Notice Forex Transactions
GAM Accused of Accounting Misstatements Connected to Hedge Fund Acquisition; Zurich’s SIX exchange is seeking a sanction against GAM, the latest snag for the money manager
Julie Steinberg – WSJ
The Swiss stock exchange on Wednesday accused beleaguered money manager GAM Holding AG of accounting misstatements connected to its 2016 acquisition of a U.K. hedge fund.
Federal Reserve terminates 2015 forex enforcement action against Bank of America
The U.S. Federal Reserve announced Wednesday it had terminated a 2015 enforcement action against Bank of America (BAC.N) over its shortcomings in preventing traders from manipulating foreign exchange rates.
Former Bumble Bee tuna CEO found guilty of price fixing
The former chief executive of Bumble Bee Foods LLC, Chris Lischewski, was found guilty of price-fixing on Tuesday, a court filing showed.
SEC Names John Vanosdall as Deputy Chief Accountant
The Securities and Exchange Commission today announced the appointment of John Vanosdall as a Deputy Chief Accountant (Accounting Group) in the agency’s Office of the Chief Accountant.
SEC Names Paul Munter as Deputy Chief Accountant
The Securities and Exchange Commission today announced the appointment of Paul Munter as a Deputy Chief Accountant (International) in the agency’s Office of the Chief Accountant.
Investing and Trading
Harsh comedown for cannabis stocks as US legalisation slows; Momentum has stalled in key markets such as New York, New Jersey and Connecticut
Gregory Meyer – FT
New York-based iAnthus is a small company with big marijuana dreams. The grower, processor and vendor of cannabis products estimates that use of the substance will quintuple to reach 55 per cent of US adults within a decade, a similar proportion to alcohol. The company’s investment presentation, featuring slides of verdant grow houses and dispensaries with the burnished woodwork of an expensive coffee shop, pictures an American market growing to more than $200bn in annual sales — a heady projection.
Whiskey Makers Are Making a Play For Climate Conscious Drinkers; By touting water conservation, forest preservation and even bee protection, distilleries put a green sheen on an industry with a heavy carbon footprint.
Amanda Schuster – Bloomberg
As the climate crisis accelerates, fueling powerful storms, unprecedented droughts and wildfires, more consumers are focused on making purchases that are environmentally sensitive.
Aramco Considers Pricing at Top to Become World’s Biggest IPO
Matthew Martin, Archana Narayanan, and Will Kennedy – Bloomberg
Saudi Aramco is considering pricing its initial public offering at the top end of a marketed range, which would make it the world’s biggest-ever new listing, people with knowledge of the matter said.
The Euro Is the Currency No One Wants to Own, Deutsche Bank Says
Charlotte Ryan – Bloomberg
Bank says liquidity from euro area slowly replacing dollar; Euro weakness persists, defying swing in external accounts
The euro is encroaching on the dollar’s territory as the world’s currency of global borrowing, but that doesn’t mean anyone wants to keep hold of it.
Here’s the Emerging Market Debt Most Exposed to U.S. Yield Shock
Marcus Wong – Bloomberg
Thai, S. Africa, S. Korea rates most sensitive to Treasuries; India and Russia bonds least responsive in Bloomberg analysis
Could 2020 finally be the year that the Treasury bears are vindicated? If so, emerging-markets traders may find that Thai, South African and South Korean bonds are the most vulnerable, while those in India and Russia would be the least responsive, a Bloomberg analysis shows.
Fighting Climate Change Comes With $2.5 Trillion Price Tag
Jana Randow – Bloomberg
Allianz predicts impact of current measures over next 10 years; Energy sector hit hardest, steel and transport also affected
Fighting climate change will cost companies worldwide nearly $2.5 trillion over the next 10 years, according to an estimate by Allianz SE.
Carmakers Shed 80,000 Jobs as Electric Shift Upends Industry
Christoph Rauwald, David Welch, and Anurag Kotoky – Bloomberg
Most job losses are concentrated in Germany, U.K. and U.S.; China and India also seeing cuts after rapid sales growth
It’s turning out to be one of the worst years ever for auto workers across the globe amid shrinking demand and a tectonic shift in vehicle technology, with Daimler AG and Audi announcing almost 20,000 job cuts in just the past week.
Glencore’s Glasenberg says successor could be in place next year
Barbara Lewis, Eric Onstad – Reuters
Glencore could announce a new chief executive next year once a new management team is in place, its current boss told an investor meeting on Tuesday as the commodities giant laid out its priorities for 2020.
Bridgewater Co-CEO Eileen Murray to Depart
Rachael Levy – WSJ
Bridgewater Associates said Eileen Murray plans to step down as co-chief executive in March, culminating a sometimes rocky leadership transition at the world’s largest hedge fund.
David McCormick, who has shared duties with Ms. Murray since 2017, will become sole CEO, the firm said Tuesday.
Bridgewater’s co-chief executive Eileen Murray to leave hedge fund; Former Treasury official David McCormick to take reins in the first quarter of 2020
Robin Wigglesworth – FT
Bridgewater’s co-chief executive Eileen Murray is exiting the giant hedge fund, leaving former Treasury official David McCormick in charge of the $160bn investment group founded by Ray Dalio after a longstanding, convoluted succession drama.
Fidelity’s Asset-Management Chief to Retire in February; Boston financial firm names Bart Grenier to succeed Steve Neff as head of asset-management unit
Justin Baer – WSJ
Fidelity Investments’ asset-management chief will retire in February, the latest leadership change at a business under pressure to adapt to investors’ preference for lower-cost funds.
Fidelity’s head of $2.8tn asset management arm to retire; Steve Neff to be replaced by head of global asset management Bart Grenier
Robin Wigglesworth – FT
The head of Fidelity’s $2.8tn asset management division is retiring from the Boston investment group after just a year in the job, to be replaced by a senior executive from its international arm.
BlackRock Raises $1 Billion For Clean Power as Wind, Solar Boom
Brian Eckhouse – Bloomberg
Commitments are from more than 35 institutional investors; Clean-energy investments are outpacing those in fossil fuel
Here’s the latest indicator of how hungry investors are to profit from clean energy: BlackRock just raised $1 billion for wind, solar and battery-storage projects.
American Companies Are Hungry for a Cut of China’s Fake-Meat Market; Beyond Meat and Impossible Foods covet the market, but startups in world’s most populous country try to leverage local advantages
Stephanie Yang – WSJ
Beyond Meat Inc. BYND -3.92% and Impossible Foods Inc. are considering China as their next big market for plant-based meat products, but local startups aim to leverage their own knowledge of Chinese tastes to gain an edge over the U.S. companies.
Brazilians Stretch for Yield and Get Stung by Unfamiliar Risks; Newcomers are often unfamiliar with the vagaries of the Brazilian corporate bond market, where it can be hard to recover losses or sell securities.
Cristiane Lucchesi, Felipe Marques, and Vinicius Andrade – Bloomberg
Gustavo Poletto bought 200,000 reais ($50,000) of bonds issued by a Brazilian road company in 2015, lured by their high yields and tax-exempt status. His broker told him it was a once-in-a-lifetime opportunity. Now the 39-year-old radiologist from southern Brazil expects to lose it all.
Lebanon Slashes Interest Rates to Ease Crisis Engulfing Economy
Dana Khraiche – Bloomberg
Lebanon’s central bank took emergency measures Wednesday in an attempt to ease the worst financial crisis hitting the country in decades.
RBC Misses Expectations in Tough Times for Investment Banking
Doug Alexander – Bloomberg
Royal Bank of Canada’s record-breaking profit engine may be running out of steam. The lender has raised the bar each year since 2011 in terms of annual earnings, and fourth-quarter net income helped make fiscal 2019 no exception. Yet the pace is cooling, with the year’s 3.5% earnings increase to C$12.9 billion ($9.7 billion) making for the slowest annual growth in a decade. Fiscal fourth-quarter earnings missed analysts’ estimates.
China’s $17 Billion Default Wave Is About to Break a Record
Hong Shen and Molly Dai – Bloomberg
Onshore bond delinquincies are rising as the economy slows; Relative to total debt, China’s 0.5% default rate remains low
China is hurtling toward another record year of onshore bond defaults, testing the government’s ability to keep financial markets stable as the economy slows and companies struggle to cope with unprecedented levels of debt.
Tokyo’s Too Cautious to Take Hong Kong’s Mantle
By David Fickling – Bloomberg
Three decades ago, it would have been an absurd question. Which city will be the financial capital of Asia? Tokyo, clearly. Now, and in the future.
JPMorgan Among Banks Added to ECB Oversight as Brexit Looms
Nicholas Comfort – Bloomberg
Goldman Sachs, JPMorgan local units entered oversight in 2019; ECB will oversee a total of 117 banks from start of 2020
The European Central Bank has started supervising some of the world’s top securities firms’ businesses in the region, as they build up their operations across the European Union ahead of Brexit.
Soft Brexit On Track; Tory Win Likely Though Election Uncertainty Remains High
Mark Rosenberg – Forbes
Despite substantial uncertainty surrounding the 12 December UK election, GeoQuant maintains its longstanding call that a soft (planned) Brexit is likely, as reflected in relatively low Institutional Stability Risk. PM Boris Johnson’s Conservative Party holds a strong position in polls that gives him a substantial parliamentary majority in election simulations. This is currently the likely outcome which, if it prevails, will produce a soft Brexit in line with the Johnson-EU agreement, establishing a customs union backstop between Britain and Northern Ireland.
General Election 2019: It’s more than just Brexit in Scotland
Glenn Campbell – BBC News
It has been dubbed the Brexit election, but for Scotland it isn’t all about the UK’s place in Europe. There’s another major constitutional question for voters to consider. The 2016 vote for the UK to leave the EU has given new energy to the debate over Scottish independence. Why? Because Scottish voters backed remain by 62% to 38% – a result markedly different from the UK-wide outcome of 52% to 48% for leave.
Brussels or Washington? Brexit means we must decide whose side we’re on
Rafael Behr – The Guardian (opinion)
It is a common problem, especially at this time of year. You agree to host a party, but when it comes around the timing feels awkward. Work is hectic, some of the guests are barely on speaking terms, someone might make an unpleasant scene. That someone might be you. A less frivolous politician than Boris Johnson could turn this week’s Nato summit to his advantage. The international stage allows a hosting prime minister to parade himself as a serious statesman, inviting favourable comparison with a Labour rival whose method for communicating on defence matters has traditionally been a loudhailer at an anti-war rally.
World’s largest printer of money is running out of money
Alyssa Newcomb – NBC News
In the United States, the task of printing money and minting coins falls to the Bureau of Engraving and Printing, which is part of the Treasury Department. But in the United Kingdom, a private company prints the nation’s bank notes and passports — and it is running short of cash.
De La Rue, which has printed banknotes for the Bank of England since 1860, and also prints currency for 140 other countries, last week issued a warning that there was “significant doubt” about its future.