Hits & Takes
John Lothian & JLN Staff
The following nominations were sent by The White House to the U.S. Senate on September 20, 2021:
– Rostin Behnam, of Maryland, to be chairman of the Commodity Futures Trading Commission, vice Heath P. Tarbert.
– Rostin Behnam, of Maryland, to be a commissioner of the Commodity Futures Trading Commission for a term expiring June 19, 2026. (Reappointment.)
– Kristin N. Johnson, of Michigan, to be a commissioner of the Commodity Futures Trading Commission for a term expiring April 13, 2025, vice Brian D. Quintenz, term expired.
– Christy Goldsmith Romero, of Virginia, to be a commissioner of the Commodity Futures Trading Commission for the remainder of the term expiring April 13, 2024, vice Heath P. Tarbert.
Here is what CME Group’s Owain Johnson said on LinkedIn about the CME Group’s new sustainable clearing: “A fantastic team worked to deliver the first-ever sustainable clearing offering. Another very positive step forward for the industry.” — LinkedIn
Any donations above $100 to the JLN MarketsWiki Education GoFundMe campaign between now and the end of October will be eligible for a raffle drawing for a video produced by John Lothian Productions up to five minutes long. Or the five minutes may be split into up to five one-minute videos. All it takes to enter is a $100 donation to the GoFundMe campaign. You can see examples of the work of John Lothian Productions at wwwjohnlothianproductions.com. HERE are some good examples of the type of work we can do.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
The International Monetary Fund recently published a commentary, “Five Things to Know About Carbon Pricing,” that endorses it as a tool against climate change. Among the arguments in its favor enumerated by the author, Ian Parry, an environmental policy expert in the IMF’s Fiscal Affairs Department, is that it can be readily implemented. “Carbon pricing, implemented through a tax on the carbon content of fossil fuels or on their carbon dioxide (CO2) emissions, is straightforward to administer as an extension of existing fuel taxes,” he says. The complete essay is here. ~SC
Covid is officially America’s deadliest pandemic as U.S. fatalities surpass 1918 flu estimates
Berkeley Lovelace Jr. – CNBC
Covid-19 is officially the most deadly outbreak in recent American history, surpassing the estimated U.S. fatalities from the 1918 influenza pandemic, according to data compiled by Johns Hopkins University. Reported U.S. deaths due to Covid crossed 675,000 on Monday, and are rising at an average of more than 1,900 fatalities per day, Johns Hopkins data shows. The nation is currently experiencing yet another wave of new infections, fueled by the fast-spreading delta variant.
*****This is not the record we were hoping to set.~JJL
British Steel warns of up to 50-fold increase in power prices; Company says situation ‘spiralling out of control’ as producers suspend operations at peak times
Sylvia Pfeifer and Harry Dempsey – FT
British Steel has warned that power prices are “spiralling out of control” as an up to 50-fold increase in quoted rates makes it impossible to produce profitably at certain times of day.
*****Get ready for the end of civilization as we know it.~JJL
Deutsche Börse expands its crypto ETN offering: for the first time access to centrally cleared ETNs on Polkadot, Solana and TRON
As of today, for the first time, three new Exchange Traded Notes (ETNs) from VanEck on the crypto currencies Polkadot, Solana and TRON can be traded via Xetra and Börse Frankfurt. The range of crypto ETNs on Bitcoin, Bitcoin Cash, Ethereum and Litecoin, which has already been successfully established on Deutsche Börse, is thus expanded to include three more crypto currencies.
***** Get ready to be transported to the world of TRON.~JJL
Men Are Losing Their Grip in the New Economy; Job growth and education are putting women in a prime position to dominate. Should we rejoice or worry?
Allison Schrager – Bloomberg
It’s no longer a man’s world. Pundits have speculated for more than a decade about the end of men. After centuries of dominating the economy, most of the job growth is in industries where women traditionally work. And those jobs require more education. The latest piece of data is that women are dominating college enrollment. In a few years, two women will earn a degree for every one man.
****** Education is the key to success for anyone.~JJL
Monday’s Top Three
Our most-read story Monday was Bloomberg’s The Global Housing Market Is Broken, and It’s Dividing Entire Countries. Second was The Wall Street Journal’s The Real Reason You and Your Neighbor Make Different Covid-19 Risk Decisions. Third was Nearly 70% of millionaires are worried about leaving ‘too much’ money to their kids, survey finds, from CNBC.
26,621 pages; 235,869 edits
New derivatives trading system J-GATE3.0 has gone live
Osaka Exchange (OSE) and Tokyo Commodity Exchange (TOCOM) today successfully launched the new derivatives trading system, J-GATE3.0, on schedule. Related listings of new products, revisions of trading rules such as the expansion of trading hours and the transfer of the J-GATE3.0 backup function to the Kansai Data Center were also completed.
Iwanaga Moriyuki, President and CEO of Osaka Exchange, Inc. (and Representative Director and Chair of Tokyo Commodity Exchange, Inc.), commented: I would like to announce that OSE and TOCOM have successfully launched the new derivatives trading system, J-GATE3.0, and that its first trading day has finished without any trouble. I would like to express my deep gratitude for the extensive and kind cooperation we have received from trading participants and related vendors in preparation for this system replacement.
Bermuda Stock Exchange Begins Publishing MIAX Pearl Equities Market Data to the Pyth Network
MIAX, creator and operator of high-performance securities exchanges, products and services, today announced that the Bermuda Stock Exchange (BSXTM), a wholly-owned subsidiary of Miami International Holdings, Inc., the parent company of MIAX, has successfully commenced publishing MIAX Pearl EquitiesTM market data for 10 actively traded U.S. companies to
the Pyth Network. This is the first initiative by BSX to provide high fidelity data to the Pyth Network. Bermuda is recognized as having a strong fintech and digital regulatory framework created by the Bermuda Government with the passage of the Digital Asset Business Act of 2018 (DABA).
SEC Expands U.S. Investor Warning on Chinese Stock Investments
Ben Bain – Bloomberg
Securities and Exchange Commission officials are expanding on their warnings for investors considering buying stock in Chinese companies that trade in U.S. markets.
SEC Should Amp Up Crypto Crackdown, Investor Advocates Say
Joe Light – Bloomberg
Many cryptocurrency projects are flouting investor-protection rules and deserve more scrutiny, a group of investor advocates told Securities and Exchange Commission Chair Gary Gensler in a Monday letter.
Finance industry warns against ‘unnecessarily restrictive’ crypto capital rules; Regulators’ requirements would freeze out banks and asset managers, say trade groups
Joshua Oliver and Philip Stafford – FT
The global financial industry has urged regulators to refrain from imposing stringent capital rules on digital assets, warning these requirements would drive activity underground and deprive banks of the benefits of the technology.
China is key to saving the planet from climate change. But it can’t quit coal.
Lily Kuo and Steven Mufson – Washington Post
This summer, the rains in Beijing felt like they would never stop. In July they forced the cancellation of hundreds of flights. Tourist sites closed and residents struggled to commute to work. In August, Ellery Lee, an energy and climate change consultant in the capital, was drenched walking through a downpour. Once home, he was shocked to see news that two people had drowned after getting trapped under a bridge in the city’s outskirts.
Central bank sync puts foreign exchange market to sleep; Global monetary response to Covid wipes out interest rate gaps between major economies
Kate Duguid and Tommy Stubbington – FT
Central banks’ efforts to steady the global economy since the start of the pandemic have lulled the $6.6tn a day foreign currency market into one of its sleepiest periods on record.
Coinbase drops plans for crypto lending product after SEC tussle
Tim Copeland – The Block Crypto
Crypto exchange Coinbase has dropped plans to launch its crypto lending product, dubbed Lend, in light of the SEC’s view that it would constitute a security, per an update to its original announcement blog post.
In the blog post update, issued Friday, Coinbase wrote: “Our goal is to create great products for our customers and to advance our mission to increase economic freedom in the world. As we continue our work to seek regulatory clarity for the crypto industry as a whole, we’ve made the difficult decision not to launch the USDC APY program announced below. We have also discontinued the waitlist for this program as we turn our work to what comes next. We had hundreds of thousands of customers from across the country sign up and we want to thank you all for your interest. We will not stop looking for ways to bring innovative, trusted programs and products to our customers.”
Wall Street Traders Were All Hedged Up for Volatility Like This
Cecile Gutscher and Elena Popina – Bloomberg News
For months as the S&P 500 hit relentless records, Wall Street has been flummoxed by the willingness of options traders to pay up for market protection. Now all that hedging activity is looking smart as the crisis at China Evergrande Group reverberates around the world. As valuation alarms rang louder, stock traders came into this week sitting on a pile of defensive derivatives, fed by fears over the spreading delta virus variant and the paring of pandemic stimulus. One measure of stock protection jumped to the highest since the February 2018 turmoil known as ‘Volmageddon’.
Wall Street’s Message on Evergrande: China Has It Under Control
Richard Frost – Bloomberg
Analysts dismiss concern that this is China’s Lehman moment; Stock markets stabilize after Monday’s global selloff
Wall Street analysts are putting their faith in the Chinese Communist Party. After a harrowing Monday that saw risky assets tumble globally on fears of a collapse in China Evergrande Group, some of the world’s biggest banks and money managers raced to assure investors that this is no Lehman moment. The message from firms including Citigroup Inc., Fidelity International Ltd. and AllianceBernstein Holding LP: Evergrande may indeed default, but Chinese authorities will take steps to prevent the property giant’s crisis from destabilizing the financial system and the economy.
Billionaire Banker Kotak Calls Evergrande China’s Lehman Moment
Suvashree Ghosh – Bloomberg
Many analysts are predicting that the cash crunch at China Evergrande Group is unlikely to become China’s version of the 2008 Lehman Brothers crash. The world’s richest banker begs to differ.
UK’s debut ‘green gilt’ sale draws blockbuster demand; Investors place £100bn of bids for 12-year debt
Tommy Stubbington – FT
The UK’s inaugural “green gilt” sale was met with record demand on Tuesday, as the country belatedly joined a growing number of European governments that have sold bonds with proceeds earmarked for environmental spending.
Credit Suisse’s Archegos Disaster Exposes Cracks in Bank Regulation; Trades routed through London weren’t in the scope of Federal Reserve stress tests of Credit Suisse’s U.S. trading arm this year
Margot Patrick – WSJ
When Archegos Capital Management blew up, it saddled Credit Suisse CS -7.39% Group AG with $5.5 billion in losses. One reason investors and regulators were blindsided: a gap in the regulatory oversight of big international banks. That is the conclusion of financial risk consultants who have sifted through the wreckage.
More companies say goodbye to the office as COVID rages and remote work gains acceptance
Paul Davidson – USA TODAY
Creative Alignments, a recruiting firm, took a wait-and-see approach to bringing its 30 staffers back to its offices in Boulder, Colorado, for most of last year. But with the COVID-19 pandemic raging, the company decided to allow its lease to expire in January and let employees continue to work from home. Company executives have debated whether to lease new space, but so far are reaping the benefits of staying virtual, including being able to hire talented candidates across the country, says Shenna Fitzgerald, Creative Alignments’ marketing director.
Johnson & Johnson’s Booster Shot Prevents Severe Infection
Robert Langreth – Bloomberg
Added dose spurs Covid antibody production, aids protection; J&J joins rivals showing booster benefits as delta circulates
A booster dose of Johnson & Johnson’s Covid-19 vaccine provided 100% protection against severe disease when given two months after the first inoculation, according to widely anticipated data that suggests it increases the potency of the one-time shot.
Malaysia Reaches Herd Immunity Threshold of 80%: Prime Minister
Yantoultra Ngui – Bloomberg
Malaysia reached its target of fully vaccinating 80% of the adult population, achieving herd immunity for adults against Covid, Prime Minister Ismail Sabri Yaakob said in a tweet on Tuesday.
Wave of ‘avoidable’ anti-vax Covid deaths takes its toll on US health workers; Treating the growing numbers of unvaccinated patients is fuelling compassion fatigue and resentment
Patti Waldmeir – FT
Dr Nicole Linder’s voice breaks as she tells the story of Kathy, a “vivacious and gregarious” patient who had to be sent home to die of Covid-19 because she refused to be vaccinated against it.
J&J Says Covid-19 Vaccine Booster Two Months After First Shot Increases Protection; Trial participants in the U.S. who received a second dose eight weeks after the first had 94% protection against the illness
Felicia Schwartz – WSJ
Johnson & Johnson JNJ -0.57% said a booster dose of its Covid-19 vaccine administered two months after the first shot increased protection against symptomatic illness in trial participants, as federal regulators evaluate data for the country’s strategy for rolling out boosters.
Exchanges, OTC and Clearing
MEMX to Launch Retail-Focused Midpoint Order
Shanny Basar – MarketsMedia
Members Exchange has filed to launch a retail-focused midpoint order type as it reached record market share ahead of its approaching one-year anniversary. MEMX started trading on 21 September 2020. The exchange was formed by a group members to increase competition, improve operational transparency, further reduce fixed costs, and simplify the execution of equity trading in the U.S. The founding members were Bank of America Merrill Lynch, Charles Schwab, Citadel Securities, E*TRADE, Fidelity Investments, Morgan Stanley, TD Ameritrade, UBS, and Virtu Financial.
MEMX Reaches Record 4% Market Share in Year One
MEMX – Businesswire
MEMX, a market operator founded by a diverse group of participants to benefit all investors, today marked one year of live exchange operations. MEMX is the fastest growing US equity exchange. On September 16th, MEMX’s market share reached an all-time high of 4.24%.
ICE Benchmark Administration Launches ICE Risk Free Rate Indexes for U.S. Dollar, Euro and Japanese Yen
Follows launch of ICE SONIA Indexes in April 2021
Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of data, technology, and market infrastructure, today announced that ICE Benchmark Administration Limited (“IBA”) has launched ICE Risk Free Rate (RFR) Indexes in U.S. Dollar (SOFR), Euro (EURSTR) and Japanese Yen (TONA), following the launch of ICE SONIA Indexes for GBP Sterling in April 2021.
Indosuez Wealth Management Selects Intercontinental Exchange for Enhanced Portfolio and Margin Optimization
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE: ICE), a leading global provider of data, technology and market infrastructure, today announced that Indosuez Wealth Management, the global wealth management brand of Crédit Agricole group, has chosen ICE’s pre-trade analytics and data to enhance its portfolio and margin optimization.
ICE trading solutions VP departs for SIX product strategy role; New managing director for product and commercial strategy at SIX spent the last six years at ICE in trading solutions and commercial strategy roles.
Wesley Bray – The Trade
ICE’s former VP of trading solutions has left the exchange to join rival trading venue SIX in a product and commercial strategy role. Shai Popat will head up product and commercial strategy at the SIX exchange after spending the last six years working in ICE’s various businesses, most recently serving as its vice president of trading solutions for its data services business.
Montreal Exchange goes live with Asia Pacific trading hours to drive global expansion; The expansion comes as part of the exchange’s extended trading hours initiative originally launched in 2018.
Annabel Smith – The Trade
Canada’s derivatives exchange, Montreal Exchange (MX), has extended its trading hours to Asia Pacific time in the latest phase of its ongoing globalisation plans. MX said the expansion would allow local investors in the Asia Pacific region to manage their exposure to the Canadian markets for almost 24 hours a day and manage cross-market strategies in their local time.
LCH ForexClear expands Asia presence with first Taiwan client CTBC Bank; The Taiwanese bank has gone live as a client clearing FX derivatives using the ForexClear service at LCH with UBS acting as the clearing broker.
Annabel Smith – The Trade
LCH has expanded the Asia presence of its FX clearing service ForexClear with the addition of its first Taiwan based client, CTBC Bank, with UBS acting as a clearing broker. The clearinghouse claimed that the ForexClear service offers members and clients enhanced risk management and margin, capital and operational efficiencies.
Universal Music Group lists on Euronext Amsterdam; Market capitalisation of EUR33.5 billion, based on the reference price of EUR18.50
Euronext today congratulates Universal Music Group, the world leader in music-based entertainment, on its listing on Euronext Amsterdam (ticker code: UMG).
Silicius Real Estate to start trading on BME Growth on Thursday, 23 September
It is the 12th company to list on this BME Market in 2021;It will have a value of 556,13 million euros on its market debut
The Board of Directors of BME Growth has approved the listing of SILICIUS REAL ESTATE SOCIMI following a thorough review of all the information presented by the company and after the favourable assessment report on its listing issued by the Coordination and Admission Committee.
Listing of CME Group Petroleum Index Futures
OSE is pleased to announce that it listed CME Group Petroleum Index Futures today.
Status of Operation of J-GATE3.0
Osaka Exchange, Inc. and Tokyo Commodity Exchange, Inc. are pleased to announce that new derivatives trading system(J-GATE3.0) has been in operation from today,21st September (Tue.), 2021.
— UPDATE: CME ClearPort Transactions – Copper Futures, Copper TAS, Copper Spot TAS — CME
Wise launches investing feature
Ryan Browne – CNBC
British financial technology firm Wise debuted an investments feature Tuesday that lets users invest in stocks through multiple currencies and spend their holdings.
The new feature, called Assets, allows customers to invest in BlackRock’s iShares World Equity Index Fund, which tracks a basket of 1,557 of the world’s biggest public companies. The fund’s holdings include Apple, Amazon and Alphabet.
Fintech startup TrueLayer raises $130 million at over $1 billion valuation
Supantha Mukherjee – Reuters
London-based fintech startup TrueLayer said on Tuesday it had raised $130 million from investment firm Tiger Global Management and payments technology provider Stripe in a funding round that valued the company at more than $1 billion.
The company, which last raised $70 million in April, has seen 400% growth in monthly payment volume this year so far, as it expanded across Europe and doubled its customer base.
Hong Kong Fintech Startup Airwallex Valued At $4 Billion In Latest Funding Round
Ralph Jennings – Forbes
Airwallex, a fintech startup headquartered in Hong Kong, has raised a $200 million Series E funding round at a valuation of $4 billion amid a wave of enthusiasm for digitalization in the pandemic era.
The funding round was led by U.S.-based Lone Pine Capital and included previous backers 1835i Ventures (formerly Australia and New Zealand Banking Group’s innovation unit), Russian billionaire Yuri Milner’s DST Global, Salesforce Ventures and Sequoia Capital China. New investors G Squared and Vetamer Capital Management, both based in San Francisco, also joined the round.
United Fintech appoints Jeff Dworin from State Street to drive US sales
Jeff Dworin has been appointed Sales Executive, Americas at United Fintech, the rapidly growing firm launched by Christian Frahm to help banks, hedge funds and asset managers to accelerate their transition to a digital world through access to fintechs specializing in capital markets.
The new math of cybersecurity value
Mary K. Pratt – CSO Online
Jenai Marinkovic doesn’t put much stock into figures that show how many attacks she and her security team have stopped.
Those numbers, she says, really don’t provide any insights.
“Saying we blocked a million doesn’t tell us anything. It doesn’t communicate enough to other executives,” says Marinkovic, who provides virtual CISO services through Tiro Security and serves on the Emerging Trends Working Group with the IT governance association ISACA.
Iowa farm services firm: systems offline due to cybersecurity incident
Karl Plume and Christopher Bing – Reuters
Iowa-based farm services provider NEW Cooperative Inc said on Monday its systems were offline to contain a “cybersecurity” incident just as the U.S. farm belt gears up for harvest.
Cisco Sees $80 Billion Cybersecurity Opportunity
Timothy Green – Nasdaq
Any company that doesn’t effectively lock down its data is susceptible to a data breach, and data breaches are expensive. Dealing with a data breach now costs $4.24 million on average, according to IBM’s latest data breach report, with more than one-third of that cost stemming from lost business resulting from increased customer turnover, system downtown, and diminished reputation.
Robinhood Quietly Tests Crypto Wallet as Users Clamor for It; Feature would allow users to send and receive crypto currency; Customers will likely need to join waitlist to gain capability
Annie Massa and Mark Gurman – Bloomberg
Robinhood Markets Inc. is testing new crypto wallet and cryptocurrency transfer features for its app, a long-awaited move that will make it easier for customers to send and receive digital currencies like Bitcoin. Evidence of the company’s work on such features has appeared in a beta version of its iPhone app. The software includes a hidden image portraying a waitlist page for users signing up for a crypto wallet feature. The app also has code referring to cryptocurrency transfers.
Ripple’s Legal Team Not Planning on Settling With SEC
Matthew De Saro – BeInCrypto
Ripple has been at war with the securities and exchange commission since December 2020 when the SEC sued Ripple Labs for allegedly issuing and selling unlicensed securities.
FTX’s Bankman-Fried on Crypto Regulation, Solana Meltdown, NFTs
Vildana Hajric and Katherine Greifeld – Bloomberg
Outright ban on stablecoins would be ‘sad,’ exchange CEO says; Expect more comprehensive regulatory frameworks, Harrison says
It’s been a busy few weeks for the cryptocurrency industry: U.S. regulators flexed their might. One of the most-hyped blockchains broke, kind of. And an insider trading scandal emerged in non-fungible tokens. Bloomberg News spoke with Sam Bankman-Fried, chief executive officer of FTX, and Brett Harrison, president of FTX.US, about the state of the cryptocurrency market. FTX.US is the U.S. affiliate of FTX, one of the world’s fastest-growing crypto exchanges. What follows is an edited and condensed version of the interview, which took place on Sept. 17:
FTX boss Sam Bankman-Fried told us why US derivatives are ‘a huge missing piece of the crypto ecosystem’ that present ‘an absolutely huge opportunity’ — and breaks down 3 big trends on his radar
Vicky Ge Huang – Insider
For all the talk of a crypto derivatives market boom, US derivatives remain “a huge missing piece of the crypto ecosystem,” according to FTX founder and CEO Sam Bankman-Fried. For example, a total of $160 billion in crypto traded globally on Wednesday morning, of which one-third was in spot trading while two-thirds were in derivatives, according to FTX’s global volume monitor.
Coinbase abandons plans for crypto lending program after spat with the SEC
Isabelle Lee – Business Insider
Coinbase Global announced it is abandoning its plans for Lend, its cryptocurrency lending program that drew the ire of the US Securities and Exchange Commission. The decision, announced in an edited blog post published on the company’s website on Friday, comes as SEC Chair Gary Gensler hardens his stance against cryptocurrency exchanges, highlighted in prepared remarks ahead of his appearance before the Senate banking committee on September 14.
Coinbase scraps plans for crypto lending program
Coinbase Global Inc has scrapped its plan to launch an interest-yielding USD Coin (USDC) lending program, the cryptocurrency exchange said in a blog post.
Binance Drops Crypto Futures, Options in Australia
Nicholas Pongratz – BeInCrypto
Binance, the world’s largest cryptocurrency by volume, will stop offering cryptocurrency futures and options to its Australian customers. In an announcement on its blog, Binance said the move was part of its constant evaluation of products and services to comply with local regulations. As part of the policy change, the exchange will also stop offering leveraged tokens to its Australian users.
Trump Treasury Secretary Steven Mnuchin Raises $2.5 Billion Fund
Sonali Basak, Heather Perlberg – Financial Adviser
Steven Mnuchin has started his next act with a multibillion-dollar fund for private equity investments. Mnuchin, a movie producer and financier before being tapped as U.S. Treasury secretary for the Trump administration, has raised about $2.5 billion at his firm Liberty Strategic Capital, according to people familiar with the matter. Most of the money is from sovereign wealth funds in the Middle East, including Saudi Arabia’s Public Investment Fund, said the people, who asked not to be named because the details are private. Liberty was founded this year with a focus on technology, financial services and fintech, as well as new forms of content, according to a statement in July announcing a $200 million investment in a cybersecurity business.
Mnuchin’s $2.5 Billion Fund Shows a Need for Tougher Ethics Rules; Did the former Treasury secretary lay the groundwork for his new venture while traveling to Saudi Arabia on government business? That’s a question we shouldn’t have to ask.
Timothy L. O’Brien – Bloomberg
Former Treasury Secretary Steven Mnuchin’s new investment fund is flush, courtesy of some of the same Middle Eastern countries he courted closely when he was one of the most powerful U.S. financial regulators.
The U.S. Is Losing the Global Race to Decide the Future of Money—and It Could Doom the Almighty Dollar
Dion Rabouin – Time
In cities across China, the country’s central bank has begun rolling out the e-renminbi—an all-digital version of its paper currency that can be accessed and accepted by merchants and consumers without an internet connection, credit or even a bank account. Already having conducted more than $5 billion in e-renminbi transactions, China has opened its digital currency up to foreigners. Next year, when Beijing hosts the Winter Olympic Games, authorities are expecting to let the world test drive its technological achievement.
Debt Limit Stalemate Opens Cracks in the Filibuster; Republican obstruction on funding the U.S. government gives Democrats little choice but to punch another hole in the power of Senate minorities.
Jonathan Bernstein – Bloomberg
A deadline crisis appears to be approaching for Congress: Legislation is needed to temporarily fund the U.S. government into October, and to raise the debt limit so that the government doesn’t default at some point this fall. In fact, it’s unlikely that either disaster will happen. But that’s not the whole story.
Top EU official warns ‘something broken’ in transatlantic relations; Thierry Breton’s intervention comes as Franco-American tensions threaten broader diplomatic efforts
James Politi and Aime Williams, and Mehreen Khan, Sam Fleming and Valentina Pop – FT
Thierry Breton, the EU commissioner for internal markets, has warned that “something is broken” in transatlantic relations, as Franco-American tensions over Washington’s new Indo-Pacific security pact threaten to spill over into trade and technology.
Former Mylan executive pleads guilty to insider trading
Jonathan Stempel and Chris Prentice – Reuters
A former information technology executive at Mylan pleaded guilty on Friday to insider trading for using tips from the drugmaker’s chief information officer to trade in its stock, generating $4.27 million of illegal profit, authorities said.
SEC vs. Ripple case could establish limit on agency’s future involvement in crypto regulation: sources
A seemingly esoteric legal battle involving the Securities and Exchange Commission and fintech startup Ripple Labs could provide clarity on how much authority the SEC has over regulating the $2.2 trillion crypto market.
The regulator’s perspective
Speech by ASIC Chair Joseph Longo at the AFA Hybrid Conference 2021, hosted by the Association of Financial Advisers, Tuesday 21 September 2021.
SEC, MSRB, FINRA to Hold Compliance Outreach Program for Municipal Advisors
The Securities and Exchange Commission’s Division of Examinations and Office of Municipal Securities (OMS), the Municipal Securities Rulemaking Board (MSRB), and the Financial Industry Regulatory Authority (FINRA) today announced the opening of registration for the 2021 Compliance Outreach Program for Municipal Advisors. The virtual program will be held Thursday, Oct. 7, 2021, from 10 a.m. to 5 p.m. ET. Additional information and program materials, including the agenda are available on the SEC website
SEC Charges Crowdfunding Portal, Issuer, and Related Individuals for Fraudulent Offerings; Case is SEC’s First Involving Regulation Crowdfunding
The Securities and Exchange Commission today charged three individuals and one issuer with conducting a fraudulent scheme to sell nearly $2 million of unregistered securities through two crowdfunding offerings. The SEC also charged the registered funding portal and its CEO, who placed the offerings on the portal’s platform.
Remarks Before the Alternative Reference Rates Committee’s SOFR Symposium
Chair Gary Gensler – SEC
Thank you, Tom. As is customary, I’d like to note that my views are my own, and I’m not speaking on behalf of the Commission or SEC staff. It’s good to be with the Alternative Reference Rates Committee to discuss the transition from the London Interbank Offered Rate (LIBOR). I’d like to thank the Committee, the New York Fed, and the Federal Reserve Board for putting this together.
Reminder: Upcoming Effective Date for Changes Relating to FINRA ADF and TRF Timestamp Granularity
On November 15, 2021, the FINRA equity trade reporting facilities (the Alternative Display Facility, the FINRA/Nasdaq Trade Reporting Facilities and the FINRA/NYSE Trade Reporting Facility, through which member firms report OTC transactions in NMS stocks to FINRA1) will begin supporting timestamps up to nanosecond (HH:MM:SS.sssssssss) granularity in accordance with amendments to FINRA’s equity trade reporting rules. As discussed in FINRA Regulatory Notice 20-41, FINRA has amended its rules to require firms to report time fields in trade reports submitted to a FINRA equity trade reporting using the same timestamp granularity that they use when reporting to the Consolidated Audit Trail (CAT). Technical specifications have been published for the ADF and for the TRFs. In addition, all participants are now able to test with the ADF and the TRFs and are encouraged to complete testing before the November 15th go-live date.
SEC, MSRB, FINRA to Hold Compliance Outreach Program for Municipal Advisors
The Securities and Exchange Commission’s Division of Examinations and Office of Municipal Securities (OMS), the Municipal Securities Rulemaking Board (MSRB), and FINRA today announced the opening of registration for the 2021 Compliance Outreach Program for Municipal Advisors. The virtual program will be held Thursday, Oct. 7, 2021, 10 a.m.-5 p.m. ET. Additional information and program materials, including the agenda, are available on FINRA’s website.
Effective date for amendment to Financial Requirements Section 18
Swap dealers (SD) using NFA or CFTC approved capital models to calculate market and/or credit risk capital charges are required to file certain information specified in CFTC Regulation 23.105(k) with NFA and the CFTC. NFA Financial Requirements Section 18 also imposes these filing requirements on SD Members using approved capital models1. NFA has amended Financial Requirements Section 18 to specify that SD Members subject to the filing requirements under CFTC Regulation 23.105(k) will satisfy NFA’s requirement by filing the information specified by NFA in the form and manner provided by NFA. This amendment will become effective October 6, 2021.
Investing and Trading
BlackRock’s Hildebrand Would Take Cash Over Gold or Bitcoin
Eddie Spence and Ranjeetha Pakiam – Bloomberg
For BlackRock Inc. Vice Chairman Philipp Hildebrand, gold and Bitcoin just can’t beat good old-fashioned cash. When asked on a virtual London Bullion Market Association panel whether he’d rather be given $10,000 in cash, bullion or Bitcoin, the former Swiss National Bank governor opted for the greenback. He didn’t explain his reasoning.
Investors Needed a Catalyst to Shatter This Market Calm; Markets were ready for a fall and China Evergrande has obliged, though U.S. stocks have gone only halfway to a correction.
John Authers – Bloomberg
Congratulations, It’s A Corr
Fleetingly, the U.S. stock market managed to get halfway to a correction. By 3:30 p.m. New York time Monday, the S&P 500 stood 5.1% below its all-time peak from earlier in September, on an intra-day basis. Then came the now-customary dose of “buy-the-dip” buying into the close. As you read this, the S&P is almost exactly 4% below its record; not even halfway to the 10% fall from peak to trough that is traditionally taken to denote a “correction.” As one wag put it in my Twitter feed, 40% of the way there means we’ve had a “corr”:
Asian buyers outbid Europe for spot supplies of US natural gas; Record fuel price in UK reaches five times American equivalent
Derek Brower and Justin Jacobs – FT
Asian buyers are winning a bidding war for American natural gas, undercutting hopes in Europe that US exports will be a quick fix for the continent’s fuel supply crisis — but bringing a windfall for traders able to capitalise on the price spike.
Foreign investors help prop up Treasury market as Fed considers retreat; Demand for US debt from China and Japan has kept prices high and yields low ahead of expected ‘taper’ this year
Kate Duguid and Joe Rennison – FT
Foreign investors cannot get enough US government debt, which analysts say could help soften the blow when the Federal Reserve starts to cut back its own bond-buying programme this year.
Environmental, Social and Corporate Governance
There’s a Fortune to Be Made in the Obscure Metals Behind Clean Power
Andrew Janes, David Stringer and Adrian Leung – Bloomberg
The era-defining shift from fossil fuels to clean energy will deliver an unprecedented new boom for commodities—and an opportunity for investors—as a range of relatively obscure materials become essential to delivering emissions-free power, transport and heavy industry.
This Might Be the Biggest Win for Upcoming Global Climate Talks; The U.S. and European Union are pressing countries to sign on to a Global Methane Pledge could reduce warming by as much as 0.2°C by 2050
Akshat Rathi – Bloomberg
It’s less than 40 days before the start of the high-stakes United Nations climate summit COP26. There are five big things on the agenda and there seemed to be little progress on any of them—until last week.
U.K. Green Bond Smashes Records in Blockbuster Market Debut
Greg Ritchie – Bloomberg
Britain breaks all-time highs for size, demand in green debt; U.K. sustainable framework sees mixed reviews from investors
The U.K.’s green bond debut broke records as investors jumped on the most anticipated sterling debt sale of the year.
Rusal strikes deal to supply Budweiser with ultra low-carbon cans; Russian group steals a green lead with ‘first commercial rollout of a near-zero carbon’ aluminium
Neil Hume – FT
Rusal says it has stolen a march on its rivals in the race to market a greener mass-produced aluminium, through a deal with Budweiser for “ultra-low” carbon beer cans.
Net zero goals cannot fall victim to the energy crisis; Governments must address hardship of high prices without jeopardising decarbonisation
FT Editorial Board
There is never a good time for energy prices to shoot through the roof. But the current spike in the cost of natural gas is particularly inconvenient for leaders of democratic countries trying to build a consensus for decarbonising their economies.
All eyes on US as nations urged to meet $100bn climate aid pledges
Officials hint more environmental funding from Biden administration is forthcoming
Laura Hughes – FT
Boris Johnson said “history will judge” the world’s richest nations if they failed to deliver on their pledge for $100bn in annual climate aid, with all eyes on the US in anticipation that it will announce more funding this week.
Bezos Puts $1 Billion of $10 Billion Climate Pledge Into Conservation; A year after announcing the Bezos Earth Fund, the Amazon founder detailed how some of the money would be spent.
Nicholas Kulish – NY Times
Jeff Bezos, the Amazon founder and one of the world’s richest men, announced plans on Monday for $1 billion in conservation spending in places like the Congo Basin, the Andes and tropical parts of the Pacific Ocean.
Investment Banking Is Cheap If You’re Rich; Also tax expertise, ESG restructuring, index funds and comparable companies.
Matt Levine – Bloomberg
Investment banking is a business of building long-term relationships. Your job, as an investment banker, is to become close to the people who possess giant piles of money, in the hopes that one day they will do giant deals with their giant piles of money and give you some of it. If you are at the weekly meeting of an investment-banking group and everyone is going around the room talking about what they did last week, and someone says “I did a billion-dollar merger and earned an $8 million fee for the bank,” and you say “I played Settlers of Catan with Mark Zuckerberg,” you win, because the expected value of proximity to a giant pile of money is so much higher than the value of an actual fee from a normal-sized pile of money.
Franklin kept initial filing for gold ETF secret; The fund had been in the works since at least the spring even though no public records existed
Jackie Noblett – FT
Franklin Templeton has been quietly working with regulators to launch an ETF to rival those of State Street and iShares, with its plans for the product kept secret until this month.
U.S. Bancorp to Buy MUFG Union Bank for About $8 Billion; Deal boosts U.S. Bank’s presence in California and other parts of the West Coast
Dave Sebastian – WSJ
U.S. Bancorp USB -2.33% has agreed to buy MUFG Union Bank’s core regional banking franchise from Mitsubishi UFJ Financial Group MUFG -2.23% for about $8 billion in cash and stock, a deal that would boost U.S. Bank’s presence in California and other parts of the West Coast.
Fidelity Taps BMO’s Joanna Rotenberg to Head $4 Trillion Personal-Investing Business; The appointment comes amid Americans’ renewed interest in stock trading
Justin Baer – WSJ
Fidelity Investments appointed Joanna Rotenberg to head its personal-investing business, picking an outsider to spearhead the division amid unprecedented demand from individual investors. Ms. Rotenberg will succeed Kathy Murphy, a long-serving deputy to Chief Executive Abigail Johnson , Fidelity said Monday. Ms. Rotenberg comes to Fidelity from Canada’s BMO Financial Group, where she served since 2016 as head of the company’s wealth-management group.
JP Morgan electronic equities exec departs for BestEx Research to head up execution; New director of execution services at BestEx Research has previously served at JP Morgan Chase, Virtu Financial, KCG Holdings, Bank of America Merrill Lynch and Barclays.
Annabel Smith – The Trade
A former JP Morgan Chase equities electronic trading executive has left the bank to join algorithmic trading platform provider BestEx Research to head up execution services. Darren Zhou has joined BestEx Research as director of execution services after most recently serving for the last three years at JP Morgan Chase in an electronic equities trading role.
KPMG-audited German fund firm reveals years-long compliance failure in UK arm; Non-compliance with UK pensions law would be considered ‘a disclosable event from the firm to the auditor’, says one pensions lawyer
Lucy McNulty – Financial News
A German fund group audited by KPMG has not complied with UK law in its London arm for years, Financial News can reveal. The German EUR13bn fund management firm, Aquila Capital has not paid into a pension scheme for its UK employees in the two years since it was first legally required to do so in July 2019, according to an internal email and payslip of one the company’s UK employees seen by FN. The company said it employed seven in its London team as of last month.
Chile Moves to Reimpose Tax on Trading Profits After 20 Years
Eduardo Thomson – Bloomberg
Taxes to help government finance higher pensions for the poor; Government presented pension bill to congress on Monday
Chile’s government plans to remove a series of tax exemptions, including one on securities trading, to help finance an increase in pensions for the poor. The pension reform, which will cost the government about $1.1 billion a year, was presented to Congress Monday for immediate discussion, President Sebastian Pinera said in a video address posted on his Twitter account.
Istanbul Turns Taps on Old Fountains, Joining Global Push for Free Drinks; For the Ottomans, providing drinking water was a philanthropic duty. These days, free public fountains are getting a push from health advocates, environmentalists and city planners.
Jennifer Hattam – Bloomberg
Istanbul’s overseers have long taken pride in providing for the thirsty, as witnessed by the hundreds of Ottoman-era public drinking fountains that dot the city. Some are elaborate shrines to drinking water, with ornately carved facades and broad eaves to shade pedestrians. Other fountains are simple rectangles set into walls, with a spigot and a basin.
Russia Sees Its Oil Output Close to Post-Soviet High Next Year
Andrey Biryukov, Olga Tanas, and Evgenia Pismennaya – Bloomberg
Total production seen at 559.9m tons in 2022 in draft budget; OPEC+ allows Russia a monthly crude-output hike of 100,000 b/d
Want the lowdown on European markets? In your inbox before the open, every day. Sign up here. Russia expects oil output next year to be back near its post-Soviet high as OPEC+ eases production curbs.
Why U.K. Gas Suppliers Are Going Bust, and Who Pays
Guy Collins and Rachel Morison – Bloomberg
The U.K. has one of the most deregulated energy markets in the world. Customers can buy natural gas for their homes directly from large suppliers or smaller ones who purchase gas from the wholesale market and sell it on. The system works fine in normal conditions but was breaking down in September under pressure from record prices caused by supply disruptions in Europe and surging post-pandemic global demand. One big question is who ends up footing the bill.
The Occupy Wall Street spirit is alive and kicking on Reddit and other social-media platforms
Thornton McEnery – Yahoo Finance
The Occupy Wall Street spirit is alive and kicking on Reddit and other social-media platforms
It has been a decade since a group of protesters filled a small, private, grassless park in lower Manhattan and began a weeks-long occupation meant to draw attention to economic inequality and the hegemony of Wall Street’s financial firms. The fury that the Occupy Wall Street movement targeted at investment banks, hedge funds and fat cats in general is no longer being communicated via bullhorns, rhythm sticks, free libraries and patchouli-scented lists of grievances for JPMorgan Chase’s CEO Jamie Dimon. Because 10 years later that populist rage can be found inside the stock market, where retail traders have picked up the baton to wage a very different, and more efficacious, sit-in on Wall Street, within the digital realm.
Influencer marketing is no silver bullet for small business; Some companies strike gold with the strategy, but for most, it needs to be part of a mixed approach
Shola Asante – FT
He was a little on the serious side; in-house counsel at a shipping firm with no discernible interest in women’s fashion. Yet his ears pricked up at the conversation between his wife and I as we sat at the kitchen table talking about my new business.
Fortune Appoints Insider’s Alyson Shontell as Top Editor; Digital-media veteran plans to focus on increasing business magazine’s online readership and subscriptions
Benjamin Mullin – WSJ
Fortune hired digital-media veteran Alyson Shontell as its next top editor, in a bid to expand the business magazine’s online readership and revenue as its print business fades. Ms. Shontell, the No. 2 editor of digital publisher Insider Inc., said she has signed a multiyear contract to be editor in chief of Fortune Media Group Holdings Ltd., responsible for all of the company’s content. She will report to Fortune Chief Executive Alan Murray.
Key hearing set in Boy Scouts of America bankruptcy case
Randall Chase – AP
A key hearing before a Delaware judge could determine whether the Boy Scouts of America might be able to emerge from bankruptcy later this year.