Hits & Takes
By JLN Staff
The folks at MIAX are happy today as the MIAX Technology teams received word that they won the award for the Most Innovative Exchange Technology for 2020 at the Fund Technology and WSL Awards 2020 Gala and Celebration in NYC. Also, MIAX market share in the volatile markets yesterday was close to an all-time high combined market share of 11.37%. Also, MIAX PEARL Options Exchange set a new contract record today with 2,326,629 contracts executed. Their previous record was 1,910,447 contracts that happened only yesterday. Also, the MIAX Exchange Group set a new group contract record today with 4,112,281 contracts executed – their previous record was set only several days ago with 3,562,532 contracts executed on 2/21/2020. Thank you to MIAX Chairman Thomas Gallagher for the figures.~JJL
Henry Schwartz on LinkedIn reported that a “new all-time option volume record occurred yesterday, with 40.7M contracts versus the prior record set in 2011 and exceeds the total contract volume for the entire year of 1977 by 3M contracts.”~JJL
The BGC Partners Charity Day application process is now open. Apply to be one of the charities receiving money from BGC. The BGC Charity Day 2020 will take place on Friday, September 11, 2020. The New York application is here and the London application is here. To date, the BGC Charity Day has raised $159 million.~JJL
Michael Bloomberg called Goldman Sachs bankers his ‘peeps’ and promised to defend them, leaked tape reveals
Andrew Naughtie – The Independent
Presidential candidate Michael Bloomberg is being criticised for telling bankers he would have defended them as president in a leaked audio from a private Goldman Sachs event in 2016.
At the event, Mr Bloomberg first described the audience as his “peeps”, and said that had he run for president that year, his “first campaign platform” would have been “to defend the banks.”
But, he added, “you know how well that’s gonna go down in this country”.
*****Before the U.S. Constitution, there were no banks in North America, or so I learned from my HIstory of the U.S. series I am listening to on Audible. And of course, Thomas Jefferson hated them immensely, so their PR problems have been around since the start.~JJL
Markets are too complacent about coronavirus despite sell-off; Assumption after assumption about the impact of the outbreak has been proven wrong
Nouriel Roubini – FT
Investors are deluding themselves about how severe the coronavirus outbreak will be. Despite this week’s big sell-off in equity markets, the worst is yet to come.
*****If you listen to politicians for trading advice, you deserve the results you get.~JJL
From Virologists to Zombie Movies, Fund Managers Consult It All
John Ainger – Bloomberg
Investors, traders turn to academic models for outbreak clues; M&G, Aberdeen remove risky assets on ‘black swan’ event
Health academics, death-monitoring platforms and even zombie movies — these aren’t normal sources of information for investors trying to assess risks in markets. But these aren’t normal times, as the coronavirus outbreak triggers an unconventional hunt for insights about what to expect from a swiftly spreading epidemic.
*****I have watched most of the zombie movies and tv series. I am available for consulting on zombies for $1000 an hour.~JJL
Tuesday’s Top Three
Our most read story on Tuesday was Eventus Systems – Why We Invested from Jump Capital. Second was The mogul, the villa and the feud that launched a rape case, about Peter Nygard and Louis Bacon, neighbors in the Bahamas, from the Chicago Tribune. Third was A decade on, did Man Group’s $1.6bn bet on GLG pay off? from The Financial Times.
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|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
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LSE’s $27bn deal for Refinitiv faces heat in Brussels; London bourse’s transformative acquisition is facing more scrutiny than expected
Javier Espinoza and Philip Stafford – FT
The London Stock Exchange Group’s $27bn acquisition of financial data provider Refinitiv is already facing intense scrutiny in Brussels, raising the risk that regulators will subject the blockbuster deal to a much lengthier probe than the companies expected.
ICE shuffles clearing house leadership in US and Europe; Exchange group dispatches US executive to London to take temporary charge of European operations
Samuel Agini – Financial News
Intercontinental Exchange, the derivatives-market giant, has appointed an interim head of its London-based clearing house, flying over a US-based executive to take charge after the departure of the president.
Wall Street Gets Worried About the Coronavirus; If the past is any guide, the hit to the global economy and markets should be relatively brief — but that’s a big if.
Ruchir Sharma – NY Times
The big surprise was not that global markets fell sharply this week on fears of the coronavirus, but that it took so long for them to wake up to the threat. Before Monday, Wall Street was full of instant experts in epidemiology predicting — on the basis of widely circulated charts showing that the number of new cases had peaked in China — that “it’s over.”
BOE to Cut Lending to Banks Using Libor-Linked Collateral
William Shaw – Bloomberg
Benchmark threatens financial stability, says BOE’s Hauser; Move comes before Libor is due to expire at the end of 2021
The Bank of England is stepping up pressure on U.K. banks to abandon the scandal-plagued Libor benchmark. Lenders seeking to borrow from the central bank will receive less money from October if they use securities linked to Libor — which underpins $30 trillion of financial contracts in sterling markets alone — as collateral. The measure, announced Wednesday, will effectively penalize firms still clinging to the benchmark before it expires at the end of 2021.
Currency Traders Looking for Havens Seek Refuge in Volatility
Vassilis Karamanis – Bloomberg
Shifting market narratives result in choppy spot price action; Euro and yen volatility hits multi-month highs across tenors
When in doubt, buy volatility. The old adage is holding strong, even as currency traders respond to shifts in sentiment in apparently conflicting ways. However else the currency market reacts, bets that there will be price swings look appealing.
Coronavirus Chaos Brings Corporate Debt Market To Its Knees
Hannah Benjamin and Tasos Vossos – Bloomberg
European bond market faces first day without deals in 2020; Warnings mount of hit to earnings as virus impacts growth
The global credit machine is grinding to a halt. The $2.6 trillion international bond market where the world’s biggest companies raise money to finance themselves, has come to a virtual standstill around the world as the coronavirus spreads fear through company boardrooms.
The Coronavirus May Be Worse Than a Natural Disaster; More than SARS, the disruption to China Inc. from the outbreak mirrors the impact of fire, floods and earthquakes.
Anjani Trivedi – Bloomberg
Everyone is wondering when China will return to work. While it may be tempting to consider past epidemics or labor strikes to gauge how quickly that could happen, the industrial shutdown from the coronavirus is looking more like a natural disaster than anything else. It may even get worse.
JPMorgan Warns Investors It May Get Walloped by Climate Change
Michelle F Davis – Bloomberg
Bank says climate crisis could materially disrupt its business; It’s a new risk factor in the bank’s annual regulatory filing
JPMorgan Chase & Co, long a target of public scrutiny for its relationship with the fossil-fuel industry, is getting more serious about the impacts of the climate crisis.
As world scrambles, experts warn virus spread in US certain
Adam Geller, Kim Tong-Hyung – AP
U.S. health officials warned Tuesday that the burgeoning coronavirus is certain to spread more widely in the country at some point, even as their counterparts in Europe and Asia scrambled to contain new outbreaks of the illness.
CDC Warns It Expects Coronavirus to Spread in U.S.; Official says authorities are preparing for a potential pandemic; Trump administration’s response is challenged in Congress
Brianna Abbott and Stephanie Armour – WSJ
Federal health authorities said Tuesday they now expect a wider spread of the coronavirus in the U.S. and are preparing for a potential pandemic, though they remain unsure about how severe the health threat could be.
World’s Biggest Wealth Fund Draws No Women in Search for New CEO
Mikael Holter and Jonas Cho Walsgard – Bloomberg
Eight candidates were all male, including fund’s deputy CEO; Appointment of Slyngstad’s successor expected in first half
In one of the world’s most gender-equal societies, a $1.1 trillion sovereign wealth fund failed to attract a single woman to apply for its top job.
Jamie Dimon says ‘door is open’ for more US bank deals; JPMorgan is banned from buying other banks but will be ‘open minded’ about other businesses
Laura Noonan – FT
Morgan Stanley’s $13bn takeover of ETrade means the “door is open” for “more ambitious and aggressive” acquisitions by US banks, Jamie Dimon, JPMorgan Chase chief executive, said on Tuesday, adding that there were a “lot of reasons” for banks to do deals.
Hunt for next chiefs puts Europe’s banks to test; Task of replacing leaders is frustrated by shallow pool of candidates
David Crow, Stephen Morris and Nicholas Megaw – FT
European banks are facing tough questions about succession planning and corporate governance as they scramble to find a new generation of chief executives amid the biggest shake-up of the industry’s top ranks since the financial crisis.
FCStone Defeats Appeal of Arbitration Decision in Investor Fight
INTL FCStone Financial Inc. won another round in its fight with investors over the proper arbitration venue for their dispute over trading losses after the Seventh Circuit rejected an appeal for lack of jurisdiction.
E*Trade Brings DNA of Diversity to Morgan Stanley; The bank can benefit from the group of female tech wizards who make the online brokerage work.
Tara Lachapelle – Bloomberg
E*Trade Financial Corp. sits at the intersection of two of the world’s most persistent boys’ clubs: Wall Street and Silicon Valley. But behind the layers of computer code that enable at-home investors — another mostly male crowd — to buy and sell stocks online, there’s a group of female tech wizards at E*Trade that make it possible.
Exchanges, OTC and Clearing
BOX Exchange Update: Adding Quote Timestamp Field To SAIL Protocol
BOX Exchange (“BOX”) recently distributed RC-2020-03 which detailed the updates BOX is making to its SAIL Protocol. The new field will allow BOX to report timestamps to the CAT that are related to quote data on behalf of Market Makers. All BOX Market Makers will be required to support the new field.
IEX Plan to Thwart Predatory Trading With AI Gets Pension Backing
A group of North American retirement plans with more than $3.3 trillion in assets has backed a proposal by exchange operator IEX Group to use artificial intelligence to counter technology some high-speed traders use to get a trading edge.
London Derivatives Exchange Announces Partnership With Indigi In The Launch Of Their Digital Security Offering
London Derivatives Exchange is pleased to announce their partnership with Indigi Pte Ltd in the launch of their Digital Security Offering (DSO). LDX is utilising its established market structure, platform, and bespoke trading/settlement methodologies to launch the DSO (currently in private placement) in conjunction with HEXTR Hong Kong (providing custodian and trust services) and Smarter Contracts (developing the smart contracts underpinning the Tokens).
Tokyo Stock Exchange to Start Proof of Concept Testing of Symphony Bot for Timely Disclosure
Tokyo Stock Exchange, Inc. (TSE) uses TDnet to distribute timely disclosure releases from listed companies. Used to promptly disseminate information likely to impact investment decisions to the investing public, the platform is considered an important infrastructure for Japanese society. At present, TDnet offers a web-based company announcements browsing service, a server-based service involving automatic file transfer, and other distribution methods.
Presentation by HKEX Chief Executive Charles Li and Group Chief Financial Officer Vanessa Lau on 2019 Final Results Announcement
2019 Annual Results Announcement
HKEX 2019 Consolidated Financial Statements
HKEX 2019 Final Results
Euronext partners with Goldman Sachs-backed Crux Informatics for FX market data; Data science FinTech Crux Informatics will deliver market data from Euronext FX to the exchange group’s clients.
Hayley McDowell – The Trade
Pan-European exchange operator Euronext has teamed up with data science specialist Crux Informatics to deliver market data from its FX electronic communications network (ECN) to clients.
KSEI Launches New CSD Solution from Nasdaq; KSEI now operating on Nasdaq technology, bolstering performance and capacity capabilities
KSEI (PT Kustodian Sentral Efek Indonesia), the central securities depository (CSD) of Indonesia, has successfully gone live with a new CSD solution by market technology provider Nasdaq (Nasdaq: NDAQ). The new and state-of-the-art CSD platform from Nasdaq provides KSEI with increased capacity and speed, with the new system operating at 40 times faster than KSEI’s previous system, while managing up to 80,000 settlement instructions per minute.
Barchart Announces Exclusive Ag Media Roundtable Event
Barchart, a leading provider of commodity data and agribusiness solutions, has announced an exclusive Ag Media Roundtable that will be available to media attendees of the 2020 Grain Summit – North America’s leading event for grain market participants.
AI computing startup SambaNova raises $250 million in BlackRock-led funding
Artificial intelligence computing firm SambaNova Systems said on Tuesday it has raised $250 million in a funding round led by BlackRock Inc to expand its customer base, reflecting investors’ appetite for the market.
How stock market prediction using AI impacts the trading floor; Robo-advisors and stock monitoring bots are changing the way traders and investors take on the stock market.
Kathleen Walch, Cognilytica
Banks and other financial institutions already see value in implementing data-driven analytics and increasing levels of automation and intelligence. Recently, adoption in financial trading has seen a significant uptick. Wealth managers are using AI to help serve more clients. Traders are implementing bots for stock market prediction using AI to gain slight market advantages.
QuantHouse Wins Best Low-Latency Data Feed – Direct Award At The 2020 A-Team TradingTech Ceremony
QuantHouse, the leading independent global provider of end-to-end systematic trading solutions including innovative market data services, algo trading platform and infrastructure solutions, today announced it has won ‘Best Low-Latency Data Feed – Direct’ at the 2020 TradingTech Awards.
Vela Named Best Managed Low-Latency Data Feed – Building On International Success With TradingTech Insight Europe Award Win
Vela, a leading independent provider of trading and market access technology for global multi-asset electronic trading, announced that it has won the A-Team TradingTech Insight Awards – Europe for Best Low-Latency Data Feed – Managed. The award, adding to the North American equivalent won in 2019, was presented at a ceremony in London following the TradingTech Summit 2020.
Fidelity veteran joins OpenDoor as technology chief; OpenDoor bolsters senior team with addition of Carson Wong from Fidelity as chief technology officer.
Kiays Khalil – The Trade
OpenDoor Securities has hired 20-year veteran of Fidelity Investments, Carson Wong, to lead the next stage of its platform’s development.
What’s going on at e-money firm ePayments Systems?
Jemima Kelly – FT
You’ve probably never heard of ePayments Systems Limited, an e-money firm based in London that counts the adult entertainment, affiliate marketing and crypto industries among its most important clients.
Swedish fintech Klarna posts first ever annual loss; Fall comes as company invests heavily to boost position in US ahead of possible IPO
Richard Milne – FT
Swedish banking company Klarna, Europe’s joint-largest unlisted fintech, suffered its first-ever annual loss in 2019, making heavy credit falls amid a big push into the US ahead of a possible stock market flotation.
Redline Trading Solutions’s InRush Ticker Plant Wins Best Software-Based High Performance Data Feed Handler
Redline Trading Solutions, the premier provider of high-performance market data and order execution systems for automated trading, won the TradingTech Insight Awards 2020 Europe for Best Software-Based High Performance Data Feed Handler.
Bank of Canada Lays Groundwork for Digital Currency
Erik Hertzberg – Bloomberg
Central bank says it doesn’t see the need to issue CBDC now; But it wants to be prepared to move quickly, should need arise
The Bank of Canada is laying the groundwork to introduce a digital currency, should the need for one emerge, Deputy Governor Tim Lane said.
Crypto Investor’s Case Against AT&T Over $24M SIM Hack Can Proceed, Judge Rules
Daniel Palmer – Coindesk
Cryptocurrency investor Michael Terpin can move forward with his case against mobile operator AT&T over his claims the firm was in part responsible for a SIM-swap hack that robbed him of holdings worth $24 million. In August 2018, Terpin initiated the case against AT&T alleging that an employee, named as Jahmil Smith, had been bribed by a “criminal gang” to assist the fraud, which passed control of the investor’s SIM card to the hackers. Terpin alleged that while he was on the telco’s hotline trying to regain access to his phone, his cryptocurrencies were stolen by the gang.
Ripple strikes three new deals in South Korea to improve remittances
Yogita Khatri – The Block
Ripple has added three new customers in South Korea who will utilize its blockchain-based payments network RippleNet.
SIX to invest in crypto platform Omniex ahead of SDX launch; The Swiss Exchange is readying the launch of its digital asset ecosystem, with Omniex set to provide the front-end platform of the business.
Kiays Khalil – The Trade
SIX Swiss Exchange has made an investment in crypto trading specialist Omniex, which will provide the front-end platform for its upcoming digital asset exchange SDX.
Coinbase Wallet Adds Short, Customizable Addresses to Simplify Sending Cryptos
Paddy Baker – Coindesk
Coinbase Wallet users can now send cryptocurrencies to “short human-friendly addresses,” as well as ones creating using the Ethereum Name Service (ENS). Product lead Sid Coelho-Prabhu announced Tuesday that Coinbase Wallet now supports customizable walle usernames for sending cryptocurrencies, rather than traditional long-form ones such as “0x89136a83664fa0673930be34463e444260775dc”. “We believe these improvements will make cryptocurrency much easier to use and help drive adoption with a more mainstream audience,” Coelho-Prabhu said in a blog post.
‘Short Bitcoin’ ETP Available to Investors on Germany’s Second-Largest Exchange
Paddy Baker – Coindesk
A “short bitcoin” exchange-traded product (ETP), which inversely tracks the value of the top cryptocurrency by market cap, is now available to investors throughout Europe. Swiss crypto product provider 21Shares, formerly known as Amun, said Tuesday its new “SBTC” tracker product would be available to both institutional and retail investors on Boerse Stuttgart, the second-largest stock exchange in Germany.
Crime And Punishment In The Cryptocurrency World
Walter Pavlo – Forbes
On December 2, 2019, prosecutors in the Southern District of New York unsealed a criminal complaint against Virgil Griffith for conspiracy to violate U.S. sanctions authorized by the International Emergency Economic Powers Act by providing services to the Democratic People’s Republic of Korea (North Korea). The indictment of Griffith, one of the developers of the Ethereum blockchain, is the first instance where the Department of Justice has publicly announced charges against a US citizen for conspiring to use cryptocurrency in an attempt to evade sanctions. It’s an interesting case of a developing technology being applied to laws dating back to 1977 (not long in years but generations in technological breakthroughs).
US Commerce Dept. Wants to Survey Firms on Cross-Border Crypto Usage
Danny Nelson – Coindesk
The U.S. Commerce Department’s Bureau of Economic Analysis (BEA) has proposed a rule change to a benchmark survey that would require all U.S. financial services companies to identify if they engaged in cross-border services related to cryptocurrency. Alongside wider rule changes to the “BE-180 Benchmark Survey of Financial Services Transactions between U.S. Financial Services Providers and Foreign Persons” – a mandatory questionnaire BEA issues every five years – the crypto proposal would, if implemented, give Commerce Department statisticians a more precise look at the prevalence of foreign crypto activity.
China’s digital currency research is delayed amid coronavirus
Yogita Khatri – The Block
China’s research into its national digital currency has reportedly been delayed due to the outbreak of the coronavirus. “The coronavirus outbreak has led to postponed work resumption in government institutions, including the People’s Bank of China,” an anonymous source close to the matter told The Global Times on Tuesday. The launch of digital yuan, however, could go ahead as planned.
Malta’s Financial Watchdog Highlights Obstacles to Security Tokens After Industry Consultation
Nikhilesh De, Sebastian Sinclair – Coindesk
The Malta Financial Services Authority (MFSA) has released a feedback statement, unveiling industry answers to questions regarding offerings of security tokens within the country. In the document published Tuesday, the EU nation’s financial regulator summarized two months of feedback received from market participants over how challenges arising from security token offerings (STOs) “can be tackled in a manner that does not stifle innovation.”
Coinbase Releases its Plan for the Coronavirus Spread
Turner Wright – Cointelegraph
Every day there are new stories of travel disruptions and public gatherings in Asia being cancelled due to the threat of the COVID-19 virus, AKA the coronavirus. Cryptocurrency and traditional markets have also been affected, with Bitcoin dropping 3% in value due to the virus being detected in Italy. When it comes to crypto exchanges handling the spread of the virus, Coinbase is preparing for the worst case scenario. According to a document shared publicly by CEO Brian Armstrong, Coinbase is preparing a four-tier escalation response to COVID-19.
Calpers Top Money Man Is Swept Up in Chinese Espionage Fears
John Gittelsohn, Sridhar Natarajan, and Jenny Leonard – Bloomberg
Schwarzman, Marks defend CIO Ben Meng as allegiance questioned; Niall Ferguson warned Meng of backlash amid Trump trade war
It was the kind of warning familiar to Fox viewers in the Trump era: An immigrant posed a danger to U.S. security. Only this time, the purported threat wasn’t part of an “invasion” from Mexico or Guatemala — he controls the fate of the retirement investments of millions of people in California.
Trump’s Plea to Shrug Off U.S. Virus Fear Ignored by Markets
Alex Wayne and Michael Shepard – Bloomberg
Health experts say disease’s arrival in U.S. is inevitable; Democratic candidates lash out at administration’s response
President Donald Trump and his top advisers want global markets and the American public to believe that the coronavirus poses little risk to the U.S. But the U.S. Centers for Disease Control and Prevention is saying just the opposite — warning Tuesday that the virus’s spread in America is inevitable and could bring significant disruption to the world’s largest economy.
Coronavirus Failures by Trump Feed a Market Dive, Democrats Say
Misyrlena Egkolfopoulou and Tyler Pager – Bloomberg
Candidates blame Trump for inaction, efforts to cut the CDC; Trump tweets Democrats won’t admit he’s doing a ‘great job’
Democratic presidential candidates tore into President Donald Trump’s response to the coronavirus epidemic, saying in their debate Tuesday that a failure to take action has fed public fear and this week’s plunge in stock markets.
A Bloomberg Business Manifesto; How New York’s former mayor should talk about capitalism with his rivals.
William McGurn – WSJ
What Mike Bloomberg should say when he takes the debate stage Tuesday night in Charleston, S.C.: Now that Bernie Sanders has swept Saturday’s Nevada’s caucuses, folks from MSNBC’s Chris Matthews to former Clinton adviser James Carville are amping up their warnings that a socialist atop the Democratic ticket will make it easier for Donald Trump to win re-election. They are right. Yet the man who tweeted that “billionaires should not exist” is no gadfly but the front-runner for the Democratic nomination.
The Democrats Make Bloomberg Their PC Punching Bag; But it seems a dubious way of getting votes. How many American voters subscribe to political correctness?
Joseph Epstein – WSJ
Poor Democrats. As if they don’t already have enough trouble, they also happen to be lashed to political correctness. How firmly lashed we learned at last week’s presidential debate, in which candidates competed over who is the most PC.
Bloomberg’s influence stretches far and wide
Ryan J. Foley, Michelle RR. Smith – AP
When Mike Bloomberg held a rally this month at the National Constitution Center in Philadelphia, the signs of his wealth and influence were everywhere.
Democrats, Republicans Study Plan to Curb Presidential Powers
Billy House – Bloomberg
House Rules Committee plans bipartisan hearing next week; Discussion will focus on trend of eroding Congress’s authority
A bipartisan effort to wrest congressional authority back from the president will get a House hearing next week to look at decades of what many lawmakers view as executive overreach — not just the actions of President Donald Trump.
Wall Street Gives Bernie Sanders a Pass…for Now; The market thinks he would lose to Trump, so what’s the problem?
Joshua Green – WSJ
Bernie Sanders’s blowout victory in the Nevada caucuses on Saturday made him the clear-cut Democratic frontrunner and infused his campaign with an aura of inevitability. That’s set off a new round of panic in some Democratic circles, as the campaigns of moderate candidates bicker over who should leave the race and fret that Sanders may already be unstoppable.
Democratic rivals pummel Bernie Sanders during TV debate; Presidential frontrunner attacked over leftist policies ahead of South Carolina primary
Demetri Sevastopulo – FT
Bernie Sanders came under heavy fire in the Democratic debate in Charleston, as the party’s other presidential contenders tried to wound the Vermont socialist who has emerged as the clear frontrunner ahead of the South Carolina primary on Saturday.
Oaktree’s Howard Marks Has Debate Advice for Mike Bloomberg
Amanda L Gordon – Bloomberg
Marks was at the Met to see British decorative arts galleries; He says Bloomberg must be ’emphatic and charismatic’
Howard Marks was at the Metropolitan Museum of Art Monday night for a preview of the renovated galleries for British decorative arts. The chinoiserie caught the museum trustee’s eye for how it demonstrates the British fascination with everything from 18th century Asia, he said.
Mike Bloomberg has done an about-face on Wall Street reform
Sheila Bair – Yahoo Finance
Can a leopard change its spots? That is the central question hanging over Michael Bloomberg’s candidacy for the Democratic presidential nomination. He has spent nearly a half billion dollars of his personal fortune on a massive advertising campaign and raft of policy proposals designed to show he is a man of the people.
CFTC to Hold Open Commission Meeting in Kansas City on March 31; First CFTC Commission Meeting Held Outside of Washington, D.C. in Nearly 25 Years
Commodity Futures Trading Commission Chairman Heath P. Tarbert officially announced that the CFTC will hold an open commission meeting in Kansas City, Mo. on Tuesday, March 31, 2020. The meeting—which is the first to take place outside of Washington, D.C. since 1997—will be held at the Federal Reserve Bank of Kansas City at 2:00 p.m. (CDT).
The SEC’s Shareholder Voting Reform Runs Counter to Attempts at Democratizing Corporate America
Ciara Torres-Spelliscy – promarket.org
Since 2010, I have urged the Securities and Exchange Commission to adopt a rule that would require disclosure of money in politics spent by publicly traded companies.
SEC to Hold National Compliance Outreach Seminar for Investment Companies and Investment Advisers
The Securities and Exchange Commission today announced the opening of registration for its compliance outreach program’s national seminar for investment companies and investment advisers. The event is intended to help Chief Compliance Officers (CCOs) and other senior personnel at investment companies and investment advisory firms enhance their compliance programs for the protection of investors.
FINRA Announces Update of the Interpretations of Financial and Operational Rules
FINRA is updating the text of the Securities Exchange Act (SEA) financial responsibility rules in the Interpretations of Financial and Operational Rules to reflect the effectiveness of a rule change that the Securities and Exchange Commission (SEC) adopted.1 The SEC’s rule change, amending paragraph (e)(1)(i)(A) of SEA Rule 17a-5, relates to a specified exemption with regard to the annual reporting requirement for a broker-dealer whose securities business has been limited to acting as broker (agent) for a single issuer in soliciting subscriptions for securities of that issuer.
ASIC update on enforcement and regulatory work; ASIC has today provided the latest six monthly update on its enforcement and regulatory work since September 2019.
The update covers our implementation of the recommendations of the Financial Services Royal Commission (FSRC), our enhanced supervision program and how we are using our new regulatory tools and powers in identifying and addressing misconduct and poor consumer outcomes.
Investing and Trading
Why the Coronavirus Isn’t a Buy-the-Dip Opportunity Yet; There are too many long-term uncertainties about demand and supply chains.
Mohamed A. El-Erian – Bloomberg
The steep sell-off in stocks related to the coronavirus has intensified focus on the financial implications of the outbreak. Much of the narrative, especially when it comes to economists and market pundits as opposed to companies, has yet to internalize the significant uncertainties concerning both the known knowns and the known unknowns.
The Gold-Rates Relationship is the one to Watch
Gregor Spilker – Open Markets
At last, gold bugs have something to celebrate. In February, the yellow metal broke through $1,650, a level not seen since 2013, when gold entered a prolonged bear market. What is driving the gold price higher and how may market fundamentals influence its price in the future?
You Can Securitize People Now; Also Aladdin, startup options, easy money and Ponzis.
Matt Levine – Bloomberg
“What if people could sell stock in themselves? Instead of borrowing money and pay back a fixed amount, why not take an advance in exchange for a fixed percentage of your future income?” I have always thought of this as the great late-night dorm-room question of financial capitalism, and in fact I wrote a very late-night-dorm-room sort of paper about it in law school. It is increasingly, though, a thing. 1 Income-based repayment is a standard option for federal student loans now. Income-sharing agreements are common enough now that they are regularly abbreviated as “ISAs,” and they have become a popular way to finance coding-school tuition. That makes sense. So much of Silicon Valley has a flavor of dorm-room capitalism anyway, so teaching people to code in exchange for equity in the people just feels natural.
Dow, S&P 500 fall 3% as coronavirus spread fans fears
Sinéad Carew – Reuters
The Dow and S&P 500 tumbled 3% on Tuesday in their fourth straight day of losses as the coronavirus spread further around the world and investors offloaded risky assets as they struggled to gauge the economic impact.
Jesuit order to ditch fossil fuels from $500 million equity portfolio
Catholic religious order Jesuits in Britain will ditch fossil fuel companies from its $500 million equity portfolio by the end of the year, it said on Wednesday, citing corporate failure to respond quickly to the threat of climate change.
The Painful Problem With Pandemic Bonds; The asset class is uncorrelated with wider markets—except at the exact moment when that matters most
Daily new coronavirus cases outside China
Mike Bird – WSJ
As the coronavirus that began in the Chinese city of Wuhan spreads rapidly around the world, pandemic bonds designed to assist poor countries in financing their response are on the verge of being triggered for the first time.
Junk bond spreads surge as investors consider virus risks; Risk premium on high-yield debt has increased by more than at any time since the Brexit vote
Jennifer Ablan and Eric Platt – FT
The premium that investors demand for owning risky high-yield debt has surged by more than at any time since the Brexit vote in 2016, as the coronavirus outbreak has menaced corporate credit markets this week.
Treasury yield hits record low, virus-fuelled stock sell-off deepens; S&P 500 stages its first back-to-back 3% drop in 4½ years
Peter Wells, Philip Georgiadis and Hudson Lockett – FT
The yield on benchmark US government debt fell to its lowest on record and stocks tumbled more than 3 per cent as American health officials warned of the potential for “severe” disruptions to daily life from the spread of the coronavirus.
Suspected state buying fails to lift coronavirus-hit Asia stocks; Region’s shares fall for third day on pandemic fears despite ‘national team’ purchases
Hudson Lockett and Leo Lewis- FT
Asian stocks dropped for a third day on fears over the spread of the coronavirus epidemic outside of China, despite traders pointing to what they described as possible buying by government institutions in an attempt to lift markets.
Goldman, Citi among banks curbing Italy trips over coronavirus fears – sources
Pamela Barbaglia, Valentina Za – Reuters
Goldman Sachs, Citigroup Inc, Credit Suisse and other investment banks have curbed trips to Italy amid fears that the coronavirus outbreak across the north of the country could quickly spread across Europe, sources said.
JPMorgan executives say bank is big enough to weather any storm
Elizabeth Dilts Marshall, Anirban Sen – Reuters
JPMorgan Chase & Co (JPM.N) executives tried to reassure investors on Tuesday that the bank can thrive during times of market and economic stress, due to the sheer size and breadth of its global operations.
JPMorgan Won’t Shun the Fed’s Discount Window Anymore; Move is likely to lessen stigma associated with borrowing directly from central bank
David Benoit – WSJ
JPMorgan Chase & Co. Chief Executive James Dimon said the bank is open to tapping the Federal Reserve’s rainy-day fund, a move that’s likely to lessen the stigma associated with borrowing directly from the central bank.
BlackRock Power Broker Barbara Novick Is Stepping Down; Co-founder of investment giant built a Washington lobbying machine
Dawn Lim – WSJ
Barbara Novick, who turned BlackRock Inc. BLK -4.17% into a force in Washington, is stepping down. The face of BlackRock’s public-policy efforts, Ms. Novick built a lobbying machine that let the money manager avoid the regulatory burdens big banks faced, fueling the firm’s transformation into a giant with $7.4 trillion in assets under management. She also supervised the firm’s oversight over public companies.
Jefferies FX prime brokerage venture adds clearing members; The TrueFX clearing member network allows the buy-side to access liquidity from market makers without an intermediary.
Hayley McDowell – The Trade
TrueFX, the FX prime brokerage service launched by investment bank Jefferies and FinTech firm Integral, has confirmed the addition of several clearing members to its ecosystem.
Banks From UBS to BofA Rethink Operations to Cope with Virus in Asia
Cathy Chan – Bloomberg
South Korea becomes next hot spot for virus as cases top 1,000; Banks are splitting up traders to avoid spread of disease
Global banks including UBS Group AG and Bank of America Corp. are broadening their contingency plans across Asia to ensure they can keep trading and other operations running as the spread of the coronavirus accelerates outside China.
JPMorgan gets busy in repo lending after regulatory thumbs up -CFO
Matt Scuffham, David Henry – Reuters
JPMorgan Chase & Co is putting more cash into overnight lending markets and holding less for a rainy day, after discussing the matter with regulators, the bank’s finance chief said on Tuesday.
Canary Wharf offices in lockdown after worker suffers coronavirus symptoms
Sam Corbishley – Metro.co.uk
Hundreds of staff were sent home after an office at London’s Canary Wharf was locked down over coronavirus fears. American oil firm Chevron advised its 300-strong work force to work remotely after an employee reported flu symptoms on their return from a country infected by the deadly bug.
Wall Street banks in Tokyo separate teams on coronavirus worries; Staff to be split into groups to prevent physical contact as anxiety mounts over outbreak
Leo Lewis – FT
The Tokyo offices of the biggest Wall Street banks are planning to split staff into groups and drawing-up plans to keep them physically segregated for weeks at a time as the financial sector braces for a major outbreak of the coronavirus in Japan.
Asia can overtake the west in sustainable investing; Investors and the financial industry can select opportunities based on ESG impact
Helene Li and Curtis Chin – FT
Asia is the dynamo of today’s global economy. But it lags behind the west in one critically-important regard: commitment to environmentally and socially sustainable investment.
An Obscure Rule Snaps One of the World’s Hottest Rallies; Beijing is trying to help firms raise cash as the coronavirus outbreak worsens. But changing refinancing regulations could spark a selloff.
Shuli Ren – Bloomberg
What do you do if your stock has doubled in just a few months and your company is bleeding cash? Sell shares, of course. A recent change to China’s refinancing rules promises to unleash billions of new shares into the market, leaving mom-and-pop investors wrong-footed and snapping one of the world’s hottest rallies. As the coronavirus outbreak worsens, bureaucratic entities from the central bank to the finance ministry have been trying to make it easier for companies to raise money. The securities regulator made no exception: On Feb. 14, it substantially relaxed equity-refinancing guidelines for listed companies.
How Fighting Climate Change Gave the EU a New Reason to Exist; A network of experts in business, policy, and science worked behind the scenes to put climate front and center for the continent’s future.
Laura Millan Lombrana and Ewa Krukowska – Bloomberg
On her first day as head of the European Commission, Ursula von der Leyen stood in front of world leaders at the UN climate conference in Madrid and promised to make Europe the world’s first carbon neutral continent within the next 30 years. “The European Green Deal is Europe’s new growth strategy,” she said.
Inside Mark Carney’s Brexit Adventure; Reviled on one side and respected on the other, the Canadian also found time to reform the 325-year-old central bank.
Jill Ward – Bloomberg
When he agreed in 2012 to cross the Atlantic and swap the governorship of the Bank of Canada for that of the Bank of England, Mark Carney declared he was “going to where the challenges are greatest.”
Post-Brexit Britain starts search for new global role
William James, Angus MacSwan – Reuters
Britain will begin trying to define the new role it wants to play in global politics, the government said on Tuesday, launching a review of foreign policy, defense, security and international aid. Britain technically completed its protracted exit from the European Union on Jan. 31, ending more than four decades of alignment with the European project. However, it remains bound by EU rules until the end of 2020 while a new trade deal is thrashed out.
Johnson promises ‘overhaul’ of post-Brexit foreign policy as he launches review
The UK is to “overhaul its approach to foreign policy” as part of a government review, Downing Street has announced. No 10 says insights from internal and external experts will challenge “traditional Whitehall assumptions”. The diplomatic service, tackling organised crime, the use of technology and the procurement of military supplies will all be looked at.
EU’s Barnier Hits Boris Johnson With Brexit Trade Ultimatum
Ian Wishart – Bloomberg
The European Union’s chief Brexit negotiator, Michel Barnier, handed British Prime Minister Boris Johnson an ultimatum, warning there will be no trade deal unless the U.K. agrees to the bloc’s demands on fair competition and fishing. “The trade deal will be associated with a fisheries agreement and a level playing field, otherwise there won’t be any agreement at all,” Barnier told reporters in Brussels on Tuesday. “If we want to achieve in the short period demanded by Mr. Johnson, we can’t have backtracking.”
New small business group aims to ‘shrug off Brexit gloom’
Daniel Thomas – Financial Times
A new organisation aiming to promote the interests of 5.8m smaller businesses in the UK has promised to work with the government and companies to “shrug off” worries over Brexit. The launch of the group on Wednesday comes amid tensions between the traditional business lobby groups and the government. Officials have criticised the negativity of big business organisations to Brexit, in particular, despite persistent concerns about the impact of leaving the EU in parts of British industry.
Madoff Wants Leniency. My Dad Received None; Why should the Ponzi scheme king get out to die, when the judges imprisoned my father with just weeks to live?
Ian Fisher – Bloomberg
I cannot remember the name of the chaplain who called from the Butner correctional facility, perhaps the nation’s premier federal prison for sick white-collar prisoners. But he was a pro. He talked slowly, in gentle circles about how my father had been very ill and how they did their best. This verbal shuffling was all so I could figure out before the chaplain said the actual word that my father, Albert Ernest Fisher III, was dead. He was 78.