Look at issuing digital currency, IMF head tells central banks

Nov 14, 2018

Look at issuing digital currency, IMF head tells central banks

Nov 14, 2018

First Read

Coinigy Joins with Merkle Data to Provide Enhanced Data
Thom Thompson – John Lothian News

Coinigy, the Milwaukee-based cryptocurrency trading front-end and data service, announced an
agreement Tuesday in which Merkle Data would provide its three cryptocurrency indexes to Coinigy’s customers. Merkle Data provides analytics and risk solutions to crypto institutions in part by analyzing the publicly available data that are a hallmark of the blockchain economy.

Coinigy offers its customers a trading interface that is connected to 15 different cryptocurrency platforms. Customers can use the Coinigy interface to access their own accounts at the cryptocurrency platforms, providing what Derek Urben, the Coinigy CFO and director of business development, calls “remote control of their accounts.” Urben notes that many cryptocurrency traders have positions in a variety of currencies on many different trading platforms, and Coinigy users can manage them all from a single platform.

Read more here

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Hits & Takes
JLN Staff

The LaSalle Street Trading Tech Awards event Thursday night will have to go on without me. Instead, on Thursday afternoon I will be having surgery to clean up an infection that has developed in my right hip, the one I had replaced on August 2.~JJL

The good news is that the LaSalle event is already a success, as the fundraising for Scouting in Chicago has surpassed last year’s numbers on the strength of fundraising led by Joanne Moffic-Silver and Amy Shelly. Both women’s personal donations put us over the top, and Joanne’s donation designated for the Fearless Girl National Youth Leadership Training Fund put us within $1000 of the $25K goal I set.~JJL

I can’t thank OCC’s Amy Shelly and Joanne Moffic-Silver of Cedar Street Asset Management LLC and formerly of the Cboe enough for their leadership, tenacity and generosity.~JJL

As for me, I will be in the hospital for a couple of days. I will be undergoing IV therapy for six weeks to finish off any remnants of the infection left after the surgery. The success rate for this procedure is about 90%, I was told by my doctor.~JJL

EMX Derivatives Exchange has named Jim Falvey as Chief Regulatory Officer.~JJL

Have an idea about the best way to get the UK’s growth rate up? The Institute for Public Policy Research wants to know. The winning entry gets GBP 100,000. Here is how to enter.~SD

On September 25, Bloomberg ran the story Oil Options Traders Buy Into Talk of Crude Topping $100 a Barrel. Looks like “sell the news” wins again as we went from four-year highs at the beginning of October to a bear market some six weeks later.~SD

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An Open Letter to the Financial Industry
RCM Alternatives Blog
The Financial Trading Industry is facing a significant and far-reaching challenge, in that it has lost its long-standing training ground for future industry leaders. The move away from the trading floors to trading via computers and automated trading technologies has eliminated the most common chain of knowledge transfer that occurred between industry veterans and newcomers. The result has been to place even more demand on academia to produce work-ready future employees for the Financial Trading Industry.
/goo.gl/FaC47S

****This has been a topic of conversation (and concern) around the office. We put out a video compilation filmed at FIA that covered the next generation of traders.~SD

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Rethinking Risk Management

JohnLothianNews.com

In times of ever changing catalysts, technologies and threats, how ought we to think about risk management?

In this video, Alex Lamb, head of marketing and business development with The Technancial Company, and Keith Todd, executive chairman and CEO of KRM22, discuss how industry participants are grappling with new risk frameworks.

Watch the video »

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Wells Fargo: Shareholders can’t sue us because they should have known we were lying
Ryan Smith – Mortgage Professional America
Wells Fargo is adopting an unusual defense against a shareholder lawsuit: claiming, essentially, that shareholders can’t hold the bank accountable for CEO Tim Sloan’s statements that it was “working to restore trust” and be “more transparent” about its scandals – because it should have been obvious that Sloan was lying.
The defense, which Wells Fargo put forth in a legal filing aimed at getting a shareholder lawsuit dismissed, relies on the legal concept of “puffery,” according to a Los Angeles Times report.
bit.ly/2z8gCOi

***** Some stories you can’t make up.~JJL

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EMX Derivatives Exchange Expands Management Team; Former BitMEX Head of Support to open Hong Kong Office
EMX
EMX, a derivatives exchange that intends to list both traditional and cryptocurrency futures, announced the addition of two key hires; Shehzad Hassam as Head of Asia Operations, and Jim Falvey as Chief Regulatory Officer and General Counsel. Hassam is the first employee in Hong Kong, the firm’s Asian headquarters.
/prn.to/2FnJHuM

***** Jim Falvey was named as chief regulatory officer. Congrats Jim, and thanks for all the help!~JJL

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BMO and 1871 Reveal the Winners of the Second Annual Innovation Mentorship Program
BMO Harris Bank
BMO and 1871 have announced the three winners for the BMO Harris / 1871 Innovation Program. This second edition of the mentorship program launched in the spring for Chicagoland and Wisconsin startups with solutions in lending, financial planning, digital tools and data analytics. This year’s program also received support from Wisconsin-based gener8tor and Kinnektor organizations.
/prn.to/2FmxzKI

***** This Chicago-Wisconsin collaboration thing has to stop before the Bears-Packers rivalry turns into a friendship.~JJL

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Tuesday’s Top Three
Our top three stories from Tuesday were led by our note about Eris Exchange’s job openings. The company is looking for talent and has several open positions. The second most read item was Bloomberg’s The Man Who Brought Down a Commodity Giant Says He Acted Alone about Arnaud Vagner who brought down Noble Group. Third was Jim Kharouf’s piece for IncubEx called Why Now Is a Great Time To Launch US Environmental Contracts

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Lead Stories

Look at issuing digital currency, IMF head tells central banks; Christine Lagarde says state-backed e-money could underpin market
Delphine Strauss – FT
Central banks should look seriously at issuing digital currency in order to “fill the void left by the decline of cash”, according to the head of the IMF.
/on.ft.com/2qKjSuH

SEC Ends Suit Against Former Jefferies Trader Cleared of Fraud
Chris Dolmetsch – Bloomberg
The U.S. Securities and Exchange Commission agreed to drop a lawsuit against former Jefferies Group LLC trader Jesse Litvak, who was cleared in August of criminal charges that he lied to customers about bond prices in trades of mortgage-backed securities following a five-year legal odyssey.
/bloom.bg/2FjDmQY

A Market Guide to a Brexit Deal, If and When It Finally Happens
Justina Lee and Charlotte Ryan – Bloomberg
Any agreement likely to boost the pound, U.K. domestic stocks; A fudged deal would extend the uncertainty for markets
U.K. negotiators have secured a deal with the European Union to exit the bloc, and on Wednesday Prime Minister Theresa May will try to win over her Cabinet and later, Parliament. For investors, a done deal would remove one of the biggest overhangs in European markets since the 2016 vote.
/bloom.bg/2FjdCUP

The winners and losers in the Brexit deal; EU appears to have achieved more of its original goals than the UK
Tony Barber – FT
It is anyone’s guess whether the draft Brexit deal agreed on Tuesday will survive the political stress tests to which it will be subjected in Theresa May’s government, her ruling Conservative party and the House of Commons.
/on.ft.com/2FjGzju

Satoshi vs. Bitcoin Jesus: Bitcoin Cash Battle Turns Personal
Olga Kharif – Bloomberg
Cryptocurrency risks splitting in two versions after tomorrow; The fight ‘seems to be a personality conflict,’ Sokolin says
Private Company
Craig Wright, the self-proclaimed inventor of Bitcoin under the pseudonym Satoshi Nakamoto, is poised to win a fight that will likely lead to the creation of another version of Bitcoin Cash, the original offshoot of the biggest cryptocurrency.
/bloom.bg/2FvATTA

The scandal of Goldman Sachs’s secret agent; Banks and consultants are tarnished by doing deals for foreign governments they should avoid
John Gapper – FT
Goldman Sachs has faced many crises in its time but none more shocking than the case of Tim Leissner, its former senior partner in south-east Asia. Wall Street is supposed to bring transparency to emerging markets, not to make corruption easier.
/on.ft.com/2qJGgV0

Britain agrees Brexit divorce deal with EU, May’s opponents vow to thwart it
TheStar
Britain struck a draft divorce deal with the European Union after more than a year of talks, thrusting Prime Minister Theresa May into a perilous battle over Brexit that could shape her country’s prosperity for generations to come.
bit.ly/2Flak3B

LCH receives licence to clear FX NDFs in Japan
LCH
Japanese Financial Services Agency approves LCH Ltd to clear FX Non-Deliverable Forwards for Japanese banks and clients; Builds on existing LCH licence to clear non-Yen OTC interest rate derivatives; Underlines LCH’s continued commitment to the Japanese market
LCH, a leading global clearing house, today announced that it has received approval for an extension to its clearing licence from the Japanese Financial Services Agency (FSA). The licence extension was granted on 31 October 2018 and enables LCH’s ForexClear service to clear FX non-deliverable forwards (NDFs) on behalf of banks and clients based in Japan.
bit.ly/2FmJxE9

A Fugitive Financier’s Charm Offensive Has P.R. Firms Proceeding With Caution
Matthew Goldstein and Kenneth P. Vogel – NY Times
A flamboyant Malaysian financier who once hosted Hollywood parties and lavished gifts on models is on a new kind of charm offensive. The financier, Jho Low, is facing charges in a multibillion-dollar scandal that has rocked politics in Asia and shaken a premier Wall Street bank. And the legal team supporting him has spent more than $1.1 million over the past seven months to help improve his reputation, according to government filings. These sophisticated services include round-the-clock crisis P.R. response, efforts to shape internet search results, and a website with international reports and legal filings intended to bolster his side of story.
/nyti.ms/2Fkak3O

Will Derivatives Bring Liquidity Back to the Bond Market?
George Bollenbacher – TABB Forum
There probably has been no subject more discussed at fixed income conferences or in the market press than the perceived lack of liquidity in the corporate bond markets worldwide. In addition, a 2016 rule promulgated by the SEC, Rule 22e-4, or the Investment Company Liquidity Risk Management Programs, has added urgency to the definition of, and the search for, liquidity in the corporate bond markets.
/goo.gl/SFvPqr

The Art Of Risk Management: A Tale Of Errors And Successes
Andre d’Almeida Monteiro, Chief Risk Officer, B3
Risk management appeared as a new area of knowledge 25 years ago, causing profound changes around the world. Nowadays, universities have professors and courses specialized to risk, companies have risk management areas and risk is regularly discussed by boards of directors. Central banks and securities and exchange commissions have risk areas and a slew of recent regulation is based on risk. The purpose of risk management is to deal with future uncertainties in order to minimize severe potential losses. How did the art of risk management reach this status?
bit.ly/2QFxfrH

The Oil-Price Collapse Is Being Driven by Cars; In emerging markets, spending less at the pump hasn’t gotten more consumers on the road.
David Fickling – Bloomberg
If you’re asking which fraction of the oil barrel is responsible for the collapse in crude prices over the past month, look no further than the world’s drivers.
/bloom.bg/2qNf1sY

Italy’s Banks Leap Aboard a Burning Ship; The lifeline thrown to Carige brings to mind the ill-fated Atlante rescue of two Venetian lenders. Is this a voyage that’s really worth repeating?
Ferdinando Giugliano – Bloomberg
You can’t say Italy isn’t creative when it comes to rescuing its banks. Banca Carige SpA, a mid-sized lender based in Genoa, has been under pressure from the European Central Bank to strengthen its capital base. Investors were reluctant to meet these demands, leaving the bank at the risk of resolution (an orderly failure, in other words.)
/bloom.bg/2qJIML4

Lloyds pays compensation to HBOS whistleblower; Banking group apologises in second settlement with former employee
Jonathan Ford in London – FT
Lloyds Banking Group has apologised and paid compensation to a whistleblower whose internal report heavily criticised the bank’s handling of a fraud that destroyed scores of small business customers.
/on.ft.com/2qNmI2m

Pressure cranked up on big commodity traders’ dealmaking; Campaigners call for more oversight of use of middlemen in energy deals
Neil Hume and David Sheppard – FT
Campaign groups have cranked up the pressure on the world’s biggest commodity traders, asking regulators to investigate the use of middlemen and well-connected individuals to secure lucrative oil deals in resource-rich countries.
/on.ft.com/2qLdeEH

Banks find a use for blockchain: cross border payments; The JPMorgan-led Interbank Information Network is starting to work at scale
Laura Noonan – FT
Finally banks may have found a problem that blockchain is able to solve now and at scale: cross border currency transfers.
/on.ft.com/2qHoWAb

Exchanges, OTC and Clearing

TMX Eyes China Bond Market
Rob Daly – MarketsMedia
North American access to China’s secondary bond market has come a little closer as the TMX Group has started testing linkages between the Shanghai Clearing House and itself, according to exchange officials.
“We are hopeful that sometime next year that we could actually start doing transactions,” said Lou Eccleston, CEO of the TMX Group, during the company’s third-quarter earnings call on November 12.
bit.ly/2DC6zFl

The LME’s $10m question: how to spend the swear jar?
Samuel Agini – Financial News
The London Metal Exchange is consulting its members on how to spend $10m in fines it has gathered from rule breakers, including from traders that have been caught swearing and chewing gum.
bit.ly/2DCvHMc

B3 and Shanghai Stock Exchange officially launch market data cooperation
B3
Brasil, Bolsa, Balcao (B3) and Shanghai Stock Exchange officially launch market data cooperation. SSE InfoNet Co., Ltd. (InfoNet), the wholly owned subsidiary of Shanghai Stock Exchange, together with its subsidiary in Hong Kong-China Investment Information Services Limited (CIIS) will act as the administer and official distributor of B3 market data in mainland China.
/goo.gl/fWzm5N

LSEG Appoints Chief Data Officer For Its Information Services Division
London Stock Exchange Group
Tom Dunlap joins the Group as Chief Data Officer for Information Services; Newly created role will develop and lead global data strategy for rapidly growing business; Position underscores LSEG’s commitment to quality, integrity and speed of global data services
London Stock Exchange Group (LSEG) today announced that Thomas K. (Tom) Dunlap has joined as Chief Data Officer (CDO) for its Information Services Division, which includes leading global index provider FTSE Russell.
bit.ly/2FkhLrR

BOC, CFETS and SGX sign strategic cooperation agreement on CFETS-BOC Bond Indices SGX
SGX will be the first exchange to distribute the Bond Indices outside of China; The three parties will explore the feasibility of disseminating the Bond Indices via SGX’s market data distribution network and developing tradable products based on the Indices
Bank of China Limited (BOC), China Foreign Exchange Trade System & National Interbank Funding Center (CFETS) and Singapore Exchange (SGX) today announced that they have signed a strategic cooperation agreement to jointly promote CFETS-BOC Traded Bond Index and its sub-indices outside of China to international investors, as well as to explore the feasibility of developing products based on the Bond Indices.
bit.ly/2qMtN2X

LCH gains regulatory approval to clear FX NDFs in Japan; Japan’s FSA grants approval for LSEG’s LCH to clear FX non-deliverable forwards in the country.
Hayley McDowell – The Trade
The London Stock Exchange Group’s clearinghouse LCH has received approval to extend its clearing license in Japan.
bit.ly/2FvwWyC

Former BATS operation in Lenexa continues growing under CBOE
James Dornbrook – Staff Writer, Kansas City Business Journal
The onetime BATS Global Markets office in Lenexa remains hugely important to its new parent company, which has added 60 employees to the area since acquiring the company.
bit.ly/2FjJCYY

Fintech

The Week in FinTech and Blockchain Law
Robert Kim – Bloomberg Law
The founder of cryptocurrency trading platform EtherDelta settled with the SEC for operating an unregistered national securities exchange in the agency’s first case of this kind.
Zachary Coburn will pay $313,000 in disgorgement and interest and a civil fine of $75,000 to settle Securities and Exchange Commission allegations his crypto site acted as an unregistered securities exchange, the agency said.
bit.ly/2zcC198

The UK’s top 100 black and minority ethnic leaders in technology; The FT and its partner Inclusive Boards present their first rankings of top BAME executives who are driving progress in the sector
FT
This is the first time the FT and Inclusive Boards, a recruitment agency that helps organisations to diversify, have published a Top 100 list of black and minority ethnic leaders in technology.
/on.ft.com/2FoUS6x

OptionMetrics Adopts Financial Instrument Global Identifier (FIGI) for Options Data Products in US, Europe, Asia, and Canada
BusinessWire
OptionMetrics, an options database and analytics provider for institutional and retail investors and academic researchers, has added the open-source global identification framework, the Financial Instrument Global Identifier (FIGI) to its IvyDB US, Europe, Asia, and Canada options data products. These identifiers provide comprehensive global coverage of financial markets, providing a contextual view of an instrument as users move through functional aspects of trading, settlement, portfolio management, asset servicing, risk management, and regulatory reporting.
/goo.gl/x5xdis

Once-Worthless Radio Waves Get New Life in Spectrum Auction; FCC to sell licenses in upper reaches of wireless world, but how useful they are remains to be seen
Drew FitzGerald – WSJ
Cellphone carriers often call their most valuable radio-wave licenses “beachfront” property—as with real estate, it pays to be in a prime location.
/on.wsj.com/2qTCWXP

AllianceBernstein revamps bond trading robot
Robin Wigglesworth in New York – FT
AllianceBernstein has launched a new version of its virtual bond trading assistant “Abbie” that will now be able to suggest junk bond trades to the investment group’s fund managers, highlighting how asset managers and banks are trying to modernise the fixed income universe.
/on.ft.com/2qM9p2c

Fintech Finance’s Power Players
Jeffrey Kutler – Institutional Investor
There is seemingly no end to the phenomenon that is fintech. At $57.9 billion in the first half of 2018, global venture capital, private equity, and mergers and acquisitions investments in the financial technology sector exceeded the full-year 2017 total by more than $10 billion, according to KPMG.
Simply put, this spells opportunity for the financiers and other transaction facilitators in Institutional Investor’s fourth annual Fintech Finance 40 ranking.
bit.ly/2z7BVzS

Cryptocurrencies

The seven deadly paradoxes of cryptocurrency
John Lewis – Bank of England Blog: Bank Underground
Will people in 2030 buy goods, get mortgages or hold their pension pots in bitcoin, ethereum or ripple rather than central bank issued currencies? I doubt it. Existing private cryptocurrencies do not seriously threaten traditional monies because they are afflicted by multiple internal contradictions. They are hard to scale, are expensive to store, cumbersome to maintain, tricky for holders to liquidate, almost worthless in theory, and boxed in by their anonymity. And if newer cryptocurrencies ever emerge to solve these problems, that’s additional downside news for the value of existing ones.
/goo.gl/TXkbyD

This chart shows how cryptocurrency mining on your own is no longer profitable
Kate Rooney – CNBC
Cryptocurrency mining isn’t what it used to be. Last year, the “mining” process of earning new cryptocurrencies using high-powered computers, then selling those digital assets, became a profitable side business for savvy entrepreneurs who set up the mining rigs in their basements and dorm rooms.
/cnb.cx/2qMAUIQ

How blockchain could save musicians billions
Richard Gray – BBC News
In the bowels of a former nuclear research bunker, Imogen Heap sits at a piano. As she beings to sing, the small audience for this rare acoustic performance cheer her on. But this crowd is not just simply enjoying the show. They stand to benefit from it too.
/bbc.in/2FgHfpU

What you need to know about the Bitcoin Cash ‘hard fork’
Aaron Hankin – MarketWatch
On Thursday, Bitcoin Cash, perhaps, the most famous hard fork of bitcoin and the fourth-largest cryptocurrency, will split in two, creating a second cryptocurrency. The two digital currencies will go by the names Bitcoin ABC (core Bitcoin Cash) and Bitcoin SV (Satoshi’s Vision). A hard fork is when developers and miners no longer agree on a proposed change to the software, despite operating on the same blockchain.
/on.mktw.net/2RSKbud

Bitcoin Cash’s ‘Mining War’ Escalates as Blockchain Hard Fork Approaches
Nikhilesh De – Coindesk
The global network of computer operators who today help power the bitcoin cash cryptocurrency are beginning to signal that they may take differing paths ahead of a technical update scheduled for Thursday. Data from Coin Dance indicates that bitcoin cash mining pools, collectives of individuals and companies providing computer power to the cryptocurrency, the world’s fourth most valuable, are indicating they will run a version of the software called Bitcoin SV, an alternative to the Bitcoin ABC software most widely used by the network today.
bit.ly/2K678HW

Marshall Island’s Plan for a National Cryptocurrency Survives Crucial Vote
Anthony Cuthbertson – The Independent
Plans to launch a national cryptocurrency for the Republic of the Marshall Islands are still in motion after President Hilda Heine survived a vote of no confidence. The Pacific Island nation intends to issue a local cryptocurrency called the sovereign (SOV) as a second legal tender, alongside the US dollar, despite concerns being raised about the economic risks involved with such an endeavour.
/ind.pn/2qJBtTN

The Latest In Blockchain In Healthcare: Top Takeaways From Distributed Health
Bill Frist – Forbes
Last week I had the honor of kicking off the third annual Distributed Health conference in Nashville, which brought together leaders in healthcare as well as blockchain innovators from across the nation. All were united by the shared belief that blockchain has transformative potential for health and healthcare, with changes already underway.
bit.ly/2OIyrIM

New Hedge Fund Is Betting On Bitcoin Adoption–And Has The Data To Back It Up
Billy Bambrough – Forbes
Bitcoin and cryptocurrency prices have stagnated so far this year, despite repeated predictions a bitcoin “bull run” could be just around the corner, but declining prices are obscuring an underlying growth in adoption and institutional infrastructure, according to new San Francisco and Singapore-based hedge fund Circuit Capital.
bit.ly/2qNnJYe

Novogratz’s Crypto Firm Turns to Tokenization of Real Estate
Doug Alexander and Olga Kharif – Bloomberg
Billionaire investor Michael Novogratz is getting on the bandwagon for the “tokenization” of assets such as real estate while prices in the cryptocurrency market languish.
/bloom.bg/2FkgFML

Politics

Hedge fund billionaire Ken Griffin slams Trump for Fed criticism
Joe Rennison and Robin Wigglesworth – Financial Times
Ken Griffin, the billionaire head of one of the world’s biggest hedge funds, has slammed Donald Trump’s criticism of the Federal Reserve, calling it “completely inappropriate for the president of the United States” and warning it could undermine confidence in the dollar.
/on.ft.com/2QN1nBa

China, the U.S. and the Oil Blame Game
Nathaniel Taplin – WSJ
Investors in the black stuff found themselves with a big black eye Tuesday. U.S. oil prices dropped by more than 7%, the worst one-day fall since 2015 following a bearish report from the Organization of the Petroleum Exporting Countries (OPEC) and more Twitter bluster on oil supply from President Trump.
/on.wsj.com/2qNpQLw

Trump Takes Aim at French Winemakers in Latest EU Trade Target
Nikos Chrysoloras – Bloomberg
French winemakers are the latest European industry to suffer threats from U.S. President Donald Trump, who is seeking to repair what he views as an unfair trade relationship between the two regions.
/goo.gl/fjcTn7

U.S. Panel Warns China Tech Prowess Threatens U.S. Security; Report finds China’s dominance of networking-equipment manufacturing threatens 5G wireless infrastructure
Kate O’Keeffe – WSJ
A commission of security and economic experts convened by Congress warned that China’s technology-manufacturing strength threatens U.S. national security and advised U.S. government agencies to be mindful of Chinese attempts to compromise government systems.
/on.wsj.com/2qIGKLe

Bloomberg likely to decide on 2020 bid by early next year
Steve Peoples, Associated Press
Having spent a fortune to help elect Democrats this fall, former New York City Mayor Michael Bloomberg declared lifetime allegiance to the Democratic Party and outlined an aggressive timeline for deciding whether to run for president.
/read.bi/2qOkShn

Trump Trade War Fallout Could Haunt U.S. Soy Farmers for Years
Isis Almeida – Bloomberg
Nixon embargo, Carter ban had lasting impact on crop markets; China turns to new suppliers, may not fully return to U.S.
If history is any guide, the trade war with China will have lasting affects for U.S. farmers and their soybean crops that the president won’t be boasting about.
/bloom.bg/2FjeVmH

Regulation

SEC Settles Insider Trading Claims Against Former Chairman and CEO of Advanced Medical Optics
SEC
The Securities and Exchange Commission today announced that it has agreed to resolve its insider trading claims against James V. Mazzo, the former Chairman and Chief Executive Officer of Advanced Medical Optics, Inc. (AMO) for allegedly tipping information about his company’s acquisition to his close personal friend, former professional baseball player Douglas V. DeCinces.
/goo.gl/j3g4Au

Who Ultimately Regulates Blockchain and Cryptocurrencies Does Matter
Ike Brannon – Forbes
While no one can be certain how the market will shake out, it does appear that blockchain technology–and the myriad cryptocurrencies that have developed concomitantly–are likely to endure. Their advent has the potential of reducing the cost of undertaking various financial transactions, which would be a boon for investors as well as the U.S. economy, as its financial markets would become more competitive against overseas competitors.
bit.ly/2Q1zh8a

More than half of firms are not producing MiFID II RTS 27 best ex reports; Research from Cappitech revealed that many firms are not producing RTS 27 reports, and 60% have no intentions to use the reports on execution quality internally.
Hayley McDowell – The Trade
More than half of capital markets firms have stated that they are not currently producing RTS 27 reports in compliance with MiFID II best execution requirements despite having a legal obligation to do so, according to new figures.
bit.ly/2Fn5EKA

Financial regulation in a digital world
ASIC
A speech by John Price, Commissioner, Australian Securities and Investments Commission at the Monash Centre For Commercial Law and Regulatory Studies Symposium, (Melbourne, Australia) 12 November 2018
bit.ly/2FnGVG6

ESMA updates its Q&As on MiFID II and MiFIR market structure and transparency topics
ESMA
The European Securities and Markets Authority (ESMA) has today updated its Questions and Answers regarding market structures and transparency issues under the Market in Financial Instruments Directive (MiFID II) and Regulation (MiFIR).
bit.ly/2FnH1NY

ESMA Updates Q&A on Short-selling Regulation
ESMA
The European Securities and Markets Authority (ESMA) has today updated its Questions and Answers (Q&As) on the Short-Selling Regulation (SSR).
bit.ly/2FppqVJ

Investing and Trading

Why oil prices tumbled from four-year highs to a bear market in just six weeks
Tom DiChristopher – CNBC
The oil market is undergoing a stunning reversal as crude futures wipe out this year’s gains after hitting their highest levels since 2014 just six weeks ago.
/cnb.cx/2QDkIVu

US-China trade war: Tariffs spur record dollar-yuan currency trading
Huileng Tan – CNBC
Market uncertainty tied to the ongoing U.S.-China trade war has spurred more transactions than ever before between the American dollar and the Chinese yuan in recent months.
Much of that volume comes as businesses and investors with exposure to the Chinese market are looking to hedge their foreign exchange risk. Many of them are looking to buy into the strengthening dollar, and that’s stoked speculation that Chinese authorities are intervening in the market to defend their currency, boosting trading volumes to new highs in the process.
/cnb.cx/2zcExw6

How millennials are changing the way the we invest
Jean Chatzky – NBC News
When you think about making an impact with your money, what comes to mind?
There are always philanthropic efforts you can support, but what about investing your money in a way that makes a social or environmental impact, while also making you a profit? Often called “ESG investing” (environmental, social and governance), “SRI” (socially responsible investing), “CSR investing” (corporate social responsibility) or simply “impact investing,” the concept has been around for years, but millennials are charting new territory when it comes to doing good with their money.
/nbcnews.to/2z8ixTc

Mega-Family Offices Strike Transatlantic Alliance to Woo Wealthy
Simone Foxman – Bloomberg
Two of the world’s biggest multifamily offices are forming an alliance. Glenmede, based in Philadelphia, and London-based Stonehage Fleming struck a deal to offer investment, trust and family office services to each other’s clients on their respective sides of the Atlantic. The tie-up will allow them to better cater to customers outside of their home markets by sharing tax, investment and trust company services, the companies said in a statement.
/bloom.bg/2FmI14V

Institutions

Goldman’s Stock Decline Has Wall Street Wondering When It Ends
Claire Ballentine and Felice Maranz – Bloomberg
Goldman Sachs Group Inc.’s shares fell for a third day as analysts speculated on how long the pain will continue. The stock dropped 0.5 percent more on Tuesday as investors grappled with the potential fallout from the firm’s involvement in raising money for Malaysia’s scandal-plagued state investment company 1MDB earlier this decade. The shares’ three-day plunge was the worst since August 2011.
/bloom.bg/2FmGrA1

Hedge Funds Seek ICO-Like Returns With Equity-Charged Tokens
Olga Kharif and Alastair Marsh – Bloomberg
‘It could be like getting in on Bitcoin at the beginning’; Regulators have yet to address how the coins should be treated
Hedge funds aren’t giving up on cryptocurrencies just yet. Even with the 70 percent plunge in the value of the digit-asset market from its record highs in December, many still have visions of the triple-digit returns that were often realized from being early participants in initial-coin offerings during the peak of last year’s frenzy.
/bloom.bg/2Fn1S3S

Vanguard Tumbles in Customer Satisfaction After Digital Snafus
Suzanne Woolley – Bloomberg
Bank scores rising and now equal credit unions, report finds; Wells Fargo is lowest-ranked national bank, Chase is highest
Vanguard Group, famed for its low-cost investment products, just broke out of the pack in a consumer satisfaction survey. But not in a good way.
/bloom.bg/2FjbCvN

Former UBS trader who lost £1.4bn faces deportation from Scotland after judicial review failure
Martin Williams – Herald Scotland
Mr Adoboli, who served four years of a seven-year sentence for a £1.4bn fraud at Swiss bank UBS, is to apply directly to the Court of Appeal to contest the decision, even though his legal team were denied leave to appeal.
bit.ly/2qN0b5w

HSBC Has a Playbook for Traders Hunkering for Growth Slowdown
Cecile Gutscher – Bloomberg
HSBC Holdings Plc is growing bearish on the global economy and bullish on the safest bonds, the latest investment bank to offer a playbook for a downturn.
/bloom.bg/2qMZp8C

Steve Cohen raises $5bn from outside investors; Hedge fund investor raises profile as he recovers from ex-firm’s insider trading scandal
Lindsay Fortado in New York – FT
Steve Cohen, the hedge fund investor, says he has raised about $5bn from investors since opening his family office to outside money earlier this year.
/on.ft.com/2qMuHwn

As Lloyds settles with HBoS fraud whistleblower it’s time to reopen debate about paying people like her; Regulators need whistleblowers to come forward but it’s only too clear that doing so exposes them to great risk. They need to be compensated for that
James Moore – Independent
The HBOS fraudsters living it up on their ill gotten gains ( Thames Valley Police )
Whistleblowing at a bank can be a very risky business, as former HBOS and Lloyds risk officer Susan Masterton can surely testify.
/ind.pn/2qKjIDR

Deutsche Bank Says More Cost Cuts Won’t Be at Expense of Revenue
Steven Arons – Bloomberg
Deutsche Bank AG’s future cost cuts won’t come at the expense of generating revenue, Chief Financial Officer James von Moltke said at a conference in London on Wednesday.
/bloom.bg/2FvABfs

Ray Dalio’s Faith in Gold Is Unshaken
Luzi-Ann Javier – Bloomberg
Bridgewater Associates maintained stake in SPDR, iShares Gold; Dalio stayed loyal to gold even amid investor sell-off
Not even gold’s second quarterly straight decline was enough to shake billionaire hedge-fund manager Ray Dalio’s confidence in gold.
/bloom.bg/2FjFKHq

Which Hedge Funds Got ‘Whale Rocked’ in October?: Taking Stock
Arie Shapira – Bloomberg
Today is the deadline for 13Fs, where funds of all kinds will disclose what stocks they bought and which ones they sold in the third quarter.
/bloom.bg/2FjdVPt

RBS’s Alison Rose, Chief in Waiting, Given Additional Role
Stefania Spezzati – Bloomberg
Royal Bank of Scotland Group Plc’s most senior female banker, Alison Rose, will become deputy chief executive officer of its ring-fenced holding company as she adds to her growing responsibilities.
/bloom.bg/2FvuQie

Regions

Fund managers place bets in Asia’s oversold assets, such as high-yield bonds
Daniel Leussink – Reuters
As contagion from worries over global growth and trade friction pushes Asian equity, bond and currency markets deeper into bear territory, fund managers are hunting for bargains in Chinese and Indian equities and high-yielding Asian dollar bonds.
/reut.rs/2qJJ3O6

Record U.S., Russia and Saudi oil production means supply well outstrips global demand: IEA; IEA says oil output from the world’s three biggest oil producers is holding global supply steady
Rachel Koning Beals – MarketWatch
The U.S., Russia and Saudi Arabia are pumping crude at record levels, causing global supply to significantly outrun demand, a monthly update from the International Energy Agency showed Wednesday.
/on.mktw.net/2qLdCD9

German central bank warns of risks to growth and banks
Reuters
Vulnerabilities in the German financial system are building up and risks to growth have increased substantially, the country’s central bank said on Wednesday, warning that banks may have insufficient buffers.
/reut.rs/2qKg0tN

China’s top pig farming firm to comply with new lower protein feed standards -exec
Reuters
China’s top pig farming company Wens Foodstuffs Group Co Ltd will comply with new government-backed guidelines on lower protein in animal feed, a company executive said.
/reut.rs/2qKg2lp

Got Dividend Jitters? Take a Look at Emerging Markets; The income play is shifting to Asia after U.S. companies stoked a record rally with debt-fueled generosity.
Shuli Ren – Bloomberg
Now that your dollars finally provide a real yield, it’s time to take a hard look at dividends.
/bloom.bg/2qL3om8

Iran Hangs Gold Coin ‘Sultan’ in Crackdown After U.S. Sanctions
Ladane Nasseri – Bloomberg
Iran executed a gold dealer known as the “Sultan of Coins,” in a warning to merchants not to exploit the country’s financial troubles as U.S. sanctions squeeze the economy.
/bloom.bg/2FpnqwH

Brexit

Confused About Brexit? Here’s a Guide as the Endgame Begins
Emma Ross-Thomas – Bloomberg News
The U.K. and European Union negotiators have reached a draft Brexit deal, according to a person familiar with the situation. But it’s far from over yet.
Here are the four things to know as we head into the home stretch.
1. What’s the deal?
It will be the most important international agreement in Britain’s postwar history.
/goo.gl/8BxJPP

Demand for new offices in London to progress even as Brexit weighs: survey
Reuters
Demand for new office space in London will continue even with the imminent exit of UK from the European Union, a closely-watched industry survey showed on Tuesday, with technology, media and telecom companies taking up most spaces in the city.
/reut.rs/2FnEgfm

May’s Brexit compromise comes with high price; Proposed solution to vexed issue of Irish border forces concessions from PM
Alex Barker and Mehreen Khan in Brussels – FT
The text is provisional and the political battle has only just begun. But a draft Brexit agreement has taken shape that could guide Britain out of the EU and shape relations for years to come.
/on.ft.com/2qJ97ZL

Miscellaneous

FT headquarters fetches £115m for Pearson; Building on Thames’s south bank to be sold to M&G Real Estate
Judith Evans – FT
The Financial Times headquarters is to be sold to M&G Real Estate for £115m, a price 28 per cent above the asking price set when Pearson, the former owner of the newspaper, put the building up for sale.
/on.ft.com/2qNmAzU

John Lothian Newsletter

So you want to know what’s happening in the financial markets?

We visit more than 100 websites daily for financial news (Would YOU do that?)

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Past Newsletters

CME to permanently close most trading pits

CME to permanently close most trading pits

First Read $40,626/$300,000 (13.5%) Anonymous ++++ Hits & Takes John Lothian & JLN Staff Without fanfare or amplification from its executives, the CME Group shut the books on most -- but not all -- of its floor trading history Tuesday afternoon with the...

NYSE Says More Staff Can Return to Trading Floor If Vaccinated

NYSE Says More Staff Can Return to Trading Floor If Vaccinated

First Read $40,526/$300,000 (13.5%) ++++ Hits & Takes John Lothian & JLN Staff Welcome to Star Wars Day. May the 4th be with you! -- Google Environmental derivative firm IncubEx has raised $11.7 million in its latest fundraising round (FT). But what was more...

Americans Can’t Get Enough of the Stock Market

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First Read $40,526/$300,000 (13.5%) ++++ Hemp Farming Looking For Credit; Carbon Credit, That Is Thom Thompson - John Lothian News Well, it is now May, and in most of the United States it is high time to get the field crops planted. Among them is hemp, industrial...

John Lothian Newsletter

We visit more than 100 websites daily for financial news (Would YOU do that?)

“John Lothian and Company… our industry intelligence.”

Rick Lane

CEO, Trading Technologies

Past JLN Newsletters

CME to permanently close most trading pits

CME to permanently close most trading pits

First Read $40,626/$300,000 (13.5%) Anonymous ++++ Hits & Takes John Lothian & JLN Staff Without fanfare or amplification from its executives, the CME Group shut the books on most -- but not all -- of its floor trading history Tuesday afternoon with the...

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