Next Round of Bank Scandals Will Be Personal; Securities Fraudsters Escape Paying SEC Fines

May 20, 2019

First Read

Hits & Takes
JLN Staff

From NYSE: On May 17th, 1792, 24 stockbrokers signed the Buttonwood Agreement. It is a one sentence document that helped lay the foundation of the US capital markets. It got its name because it was signed on Wall St, under a buttonwood tree. The agreement assured that the public could have confidence in the markets, and that all trades were carried out between two trusted parties. We trace our origins to the signing of this document, celebrating our 227th anniversary today.~JJL

There seems to be a lot going on at Deutsche Bank today: Deutsche Bank staff flagged Trump’s banking activities for suspicious activity; Deutsche Bank Shares Hit All-Time Low; Deutsche Bank Top Investor BlackRock to Outsource Voting at AGM; Deutsche Bank loses head of FX trading business in Europe. All those stories are dispersed below in various sections.~SR

My son, Robert Lothian, graduated on Sunday from York Community High School in Elmhurst, IL. He is the third and last offspring to graduate from York. He is headed to University of Missouri at Columbia in the fall, the same school from which my son Tim graduated.~JJL

++++


The Spread – Hip Hop Greeks
JohnLothianNews.com
What’s your favorite options related rhyme? If you don’t have one, you should after watching this week’s episode of “The Spread.”
Watch the video »

++++

Bridging the Week: May 13 – 17 and May 20, 2019 (Bump Goes the Futures Orders; JAC Warns FCMs)
Gary DeWaal – Bridging the Week
The Commodity Futures Trading Commission determined not to stand in the way of a rule amendment by ICE Futures U.S. to impose speed bumps on certain orders entered in two futures contracts traded on the exchange. Two commissioners raised concerns that the rule amendment might be anticompetitive. Separately, the futures industry’s Joint Audit Committee reiterated prior guidance that a futures commission merchant may not guarantee customers against losses, or pay out funds from any individual account of a customer, where the payout would leave the aggregate of accounts of the customer at the FCM undermargined. Moreover, JAC strongly suggested FCMs take certain immediate actions to comply with its guidance with the implicit suggestion “or else.”
bit.ly/30usu9A

++++

Friday’s Top Three
Our top story of the day on Friday was Thom Thompson’s JLN piece POP goes the speed bump! about the ICE Futures US move to impose a speed bump on its gold and silver futures contracts. Second was the Susquehanna blog, Q&A with High-Stakes Poker Player and SIG Trading Intern, Jens Kyllˆnen. Third was the announcement The Small Exchange Raises $10 Million from Citadel Securities and Jump Capital in New Strategic Financing Round

++++

MarketsWiki Stats
151,775,106 pages viewed; 23,723 pages; 219,214 edits
MarketsWiki Statistics

++++

CryptoMarketsWiki Website»
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

Recently updated pages include
Stellar (XLM)
John McAfee
Caspian
Bitfinex

CryptoMarketsWiki Stats

1,087 pages; 9,620 edits
CryptoMarketsWiki Statistics

Lead Stories

The Next Round of Bank Scandals Will Be Personal; After $372 billion of fines for bad behavior, expect bankers’ non-financial conduct to come increasingly under the microscope.
Elisa Martinuzzi – Bloomberg
Since the financial crisis, banking scandals have been expensive; now the attention may turn increasingly personal. After more than $372 billion of fines, significant progress has been made in getting the industry to root out wrongdoing. Just last week, the European Commission fined five companies a total of 1.1 billion euros ($1.2 billion) for colluding in the foreign-exchange market.
/bloom.bg/2WTrqK9

Some Securities Fraudsters Escape Paying SEC Fines; Regulator levies billions in fines, but it doesn’t always collect; SEC’s collection rate falls to 10-year low
Dave Michaels – WSJ
Wall Street watchdogs often tout the fines they levy on alleged wrongdoers. Yet much of that money is never collected. The Securities and Exchange Commission over the five years ending in 2018 took in 55% of the $20 billion in enforcement fines set through settlements or court judgments, according to agency statistics. During the prior five years, from 2009 through 2013, the SEC collected on 60% of $14.6 billion.
/on.wsj.com/2WThYX7

Miami International to launch cash equities exchange; US equity options exchange group announces new plans for cash equities exchange slated to launched in Q2 2020.
John Brazier – The Trade
Miami International Holdings (MIH), the operator of the MIAX Exchange Group, has announced it is to launch a new cash equities exchange.
bit.ly/2WTiHYl

Cryptocurrencies Pose No Threat to Financial Stability: EU Central Bank
Yogita Khatri – Coindesk
The European Central Bank (ECB) has said that cryptocurrencies are currently not a threat to financial stability in the euro zone.
bit.ly/2WTqtSc

****From Bloomberg: Digital Euro Could Either Help or Harm Economy, ECB Paper Says.

Fund groups tested on gender pay and lack of female managers; Companies all totally happy to acknowledge the challenge, says ShareAction chief
Jennifer Thompson – FT
The UK’s largest listed asset managers are being challenged over how they plan to eradicate their chronic gender pay gaps and boost the number of women in high-paying jobs managing money.
/on.ft.com/2WTn8CE

China blocks Shanghai Gold Exchange platinum contract; Failure highlights problem of opening up nation’s domestic commodity markets
Henry Sanderson – FT
The Shanghai Gold Exchange has delayed plans for a platinum contract after failing to gain political clearance, threatening a push to open up a market for the precious metal dominated by the arm of a big state-owned company.
/on.ft.com/2WU9fEj

LCH RepoClear appoints UnaVista as trade repository ahead of SFTR implementation; LSEG units announce new deal for reporting of Securities Financing Transactions ahead of new regulations due in April next year.
John Brazier – The Trade
LCH’s RepoClear is to use UnaVista as its trade repository for reporting obligations under the Securities Financing Transaction Regulation (SFTR).
bit.ly/2WWsAVc

Deutsche Bank staff flagged Trump, Kushner transactions for watchdog: NYTimes
Reuters
Anti-money laundering specialists at Deutsche Bank AG recommended in 2016 and 2017 that multiple transactions involving entities controlled by U.S. President Donald Trump and his son-in-law, Jared Kushner, be reported to a federal financial-crimes watchdog, the New York Times reported on Sunday.
/reut.rs/2WUk49n

Trump rejects New York Times report on Deutsche Bank transactions
Reuters
U.S. President Donald Trump on Monday rejected a New York Times report that raised questions about multiple Deutsche Bank transactions involving entities controlled by him and his son-in-law Jared Kushner.
/reut.rs/2WVBn9Z

Chinese firms’ missing US$6bil tests regulators’ resolve
The Star.com.my
Cash is considered among the hardest assets for a company to fake, which is why the disappearance of a combined $6.1 billion (4.7 billion pounds) from two Chinese companies has dumbfounded investors and forced regulators to take action.
bit.ly/2WWg3Bk

IPOs are particularly risky right now
Carin L. Pai – MarketWatch
The market for initial public offerings gained traction in 2018, heated up in early 2019, and is now accelerating at a pace that could result in a record-breaking year for IPOs.
/on.mktw.net/2WX8wSS

China Probes Former Top Securities Regulator for Corruption; Liu Shiyu allegedly violated law and flouted Communist Party regulations
Chun Han Wong – WSJ
China’s anticorruption agencies are investigating a former top securities regulator for allegedly violating the law and flouting Communist Party regulations.
/on.wsj.com/2WWgRpQ

Stock Exchanges in Need of Reform. Is the Long-Term Stock Exchange the Answer?
Annie Gaus – The Street
With more blockbuster IPOs around the corner, some Silicon Valley tastemakers believe that stocks could use a newer, leaner home.
bit.ly/2WUTiNU

Al Gore Keeps Beating the Stock Market. Here’s What He’s Buying and Selling.
Ed Lin – Barron’s
Former Vice President Al Gore has been busy trying to save the world óand beat the stock market. How he’s doing on the former is fair game for debate. But regarding the latter, he’s been undeniably successful.
bit.ly/2X2QzSA

Exchanges, OTC and Clearing

LCH Group selects UnaVista for its SFTR-compliant trade repository
London Stock Exchange Group
UnaVista is delighted to announce that it has been selected by LCH’s RepoClear as their trade repository to meet their reporting obligations under the Securities Financing Transaction Regulation (SFTR). LCH Group’s Collateral and Liquidity Management function will also be using UnaVista for its SFTR reporting. SFTR is scheduled to go live in April next year and will require firms to report details of their Securities Financing Transactions (SFTs) to an approved trade repository. Known as the ‘MiFID II for repo’, the regulation is designed to increase transparency, allowing regulatory authorities to assess the risks associated with these transactions. LCH provides Europe’s leading clearing service for government bond and repo markets, with EUR197 trillion cleared across the group in 2018.
bit.ly/2WPouya

Miami International Holdings Partners with Leading Equities Firms to Launch Cash Equities Exchange
MIAX
Miami International Holdings, Inc. (MIH), the parent holding company of the MIAX, MIAX PEARL and MIAX Emerald options exchanges (the MIAX Exchange Group), today announced that it has partnered with a number of industry-leading liquidity providers and market makers to launch a cash equities exchange under MIAX PEARL’s exchange license. MIAX PEARL Equities is expected to launch in Q2 2020, subject to SEC approval.
/yhoo.it/2Qcn0vn

Eurex: supporting Europe
Eurex
We at Eurex are deeply rooted in Europe: on 28 September 1998, Schweizer Bˆrse and Deutsche Bˆrse celebrated the completion of a truly ambitious project. Eurex was the collective name given to the two exchanges Eurex Deutschland (the legal successor to DTB) and Eurex Zurich (the legal successor to SOFFEX) that formed a new joint system. Eurex offered trading and clearing for futures and options on stock indexes as well as on capital market instruments and on money-market paper.
bit.ly/2WStDWp

Chicago CIO Leadership Association Announces Recipients of 2019 CIO of the Year ORBIE Awards
PRWeb
David Hoag, SVP & CIO, Options Clearing Corporation, received the Corporate ORBIE, for organizations up to $450 million annual revenue.
bit.ly/2HwmSTt

HKEX to Extend After-Hours Trading Session on 17 June
HKEX
After-Hours Trading Session to be extended by two hours to 3 am; Customers will be able to better tap Hong Kong’s market, managing their risk and capitalizing on opportunities
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to announce today (Monday) that it is to extend its after-hours trading session (T+1 Session) by two hours. Effective Monday 17 June 2019, trading in the T+1 Session will be open from 5:15 pm to 3 am. As well, the T+1 Session Cutoff Time (the deadline for system input of post-trade after the T+1 Session) will be extended from 1:45 am to 3 am.
bit.ly/2WWt9hM

CME Group Appoints Trey Berre as Global Head of Data Services
CME Group
CME Group, the world’s leading and most diverse derivatives marketplace, today announced the appointment of Trey Berre to Global Head of Data Services.
bit.ly/2WUjGYt

The 18th Annual General Shareholders Meeting
JPX
The same notice was disclosed on the Internet on May 20, 2019 to provide shareholders with information early after the completion of the legal procedure.
bit.ly/2WZAAoI

HKFE Announces Margins For Futures Contract: USD/CNH Futures, CNH/USD Futures
HKFE
Please be advised that pursuant to Exchange Rule 617(d) and HKCC Rule 402, the Exchange and the Clearing House have determined that with effect from the commencement of trading on Tuesday, 21 May 2019, the margin levels of the following Futures Contracts shall be as follows:
bit.ly/2WT2sdR

Moscow Exchange: Futures On Money Market Benchmark RUSFAR Begin Trading On MOEX
Mondovisione
On 21 May 2019, Moscow Exchange will launch cash-settled futures contracts on the Russian Secured Funding Average Rate (RUSFAR), which is the most representative rate measuring the value of the Russian Ruble in deposit and lending transactions by banks, brokers and non-financial companies.
bit.ly/2WPpx14

Fintech

Hedge Funds Beware: Equities Electronification Is Only One Piece of the Puzzle
Chris Hollands, TradingScreen – TabbForum
For hedge funds to stand any chance of being able to improve their execution performance and avoid being marginalized by dominant electronic market makers, their trading desks must now have multi-asset-class expertise and they must consolidate various execution platforms down to one. While the established wisdom has been to look to equities to figure out how to deliver the best possible electronic execution across the other asset classes, methodologies more commonly associated with Fixed Income execution are becoming more attractive for the trading of illiquid and difficult to execute stocks.
bit.ly/2Vz6Hdi

Top Commodities Firms and Financial Institutions Seek To Launch Forcefield
PRNewswire
A collection of top physical commodities firms and financial institutions, supported by technology giant Accenture, today announced plans to explore launching Forcefield, a pioneering inventory management system focused on implementing blockchain, Internet of Things (IoT) sensors, and near-field communication (NFC) chips to securely and efficiently manage the post-trade processing of commodity transactions.
/prn.to/2VDq6tw

Financial Institutions Utilize Diverse and Maturing Fintech Solutions
PRNewswire
The evolution of technology has completely reshaped many industries around the world. Now, almost every industry has incorporated technology into their business models in order to thrive among the competition. Sectors ranging from communication, food, education, business, to even finance have all integrated innovative and advanced technology. Specifically, the financial world has been deeply impacted by the growth of technology.
/prn.to/2QiiJGY

A fintech revenue surge helped Tencent smash quarterly expectations
Mekebeb Tesfaye – Business Insider
This is an excerpt from a story delivered exclusively to Business Insider Intelligence Fintech Briefing subscribers. To receive the full story plus other insights each morning, click here. Tencent posted record quarterly profits and smashed market expectations in Q1 2019, driven largely by surges in its fintech and cloud revenue, per Reuters.
bit.ly/2JXlAnD

Cryptocurrencies

RETAIL REPORT: 2/3 of Wealthy Want Crypto in Portfolios
John D’Antona Jr. – Traders Magazine
So, who wants to buy crypto?
Everybody? Maybe. But according to new research from deVere Group the wealthy are looking to increase their cryptocurrency exposure. The firm said that more than two-thirds of high-net-worth individuals will be invested in cryptocurrencies in the next three years.
bit.ly/2JwAlOv

How the weed-loving CEO of a Bitcoin firm partied his way to jail
Larry Getlen – NY Post
When Cameron and Tyler Winklevoss, the twin brothers who famously feuded with Mark Zuckerberg over the creation of Facebook, attended a 2012 meeting about Bitcoin, they expected a professional overview of investment opportunities in the new cryptocurrency.
/nyp.st/2WX4M3M

Data Shows Bitcoin Has Radically Changed
Billy Bambrough – Forbes
Bitcoin, which has exploded back into the public consciousness over the last few months due to its surging price and a raft of positive cryptocurrency developments, is still a relatively new technology, just into its tenth year. The bitcoin price, the biggest driver of bitcoin and cryptocurrency awareness, has gone from pennies per bitcoin 10 years ago to around $8,000 and has thrust crypto into the investment limelight as individuals and institutions scramble to grab a slice of the bitcoin pie.
bit.ly/2HqOt9Y

JPMorgan Says Bitcoin’s Jump Mirrors 2017’s Boom-Bust Pattern
Joanna Ossinger – Bloomberg
Price has diverged from ‘intrinsic level’: Panigirtzoglou; Biggest cryptocurrency advances on Monday as much as 17%
Bitcoin may have gotten ahead of itself with its recent rally, according to JPMorgan Chase & Co.
/bloom.bg/2WWae6W

Most crypto exchanges were built by young and inexperienced coders – now it’s time they learn from the banks
Trijo News
Crypto industry needs stronger regulation and oversight to protect customers, according to Daniel Santos, CEO at Digitizing Assets.
bit.ly/2YwN1sn

Facebook Registers Secretive ‘Libra’ Cryptocurrency Firm in Switzerland
John Biggs – Coindesk
According to a Reuters report, Facebook registered a new company, Libra Networks, in Geneva on May 2. This coincides with the slow roll-out of their internal cryptocurrency that will define the company’s first foray into blockchain technology. Facebook Global Holdings is a stockholder in the new company and it will, according to Reuters, “provide financial and technology services and develop related hardware and software, plans submitted on the Swiss register reveal.”
bit.ly/2EkDpt9

Andrew Yang Pitches Himself as the Presidential Candidate for the Crypto Community
Hassan Maishera – Blokt
Andrew Yang, a United States presidential candidate running for the Democratic Party, has come out to air his support for cryptocurrencies and their underlying technology, blockchain. The digital entrepreneur revealed that he would like to see greater regulation of the crypto space.
bit.ly/2El1dgt

Platform Allows Users to Send and Receive Cryptocurrency With Gadget of Their Choice
Connor Blenkinsop – Cointelegraph
The team behind a private digital currency for secure payments says its goal is to make every consumer their own bank ó enabling them to send and receive crypto with the gadget of their choice. Xeonbit says its peer-to-peer technology ensures that every user’s accounts and transactions are “out of reach to any prying eyes.” A feature known as “ring signatures” means public keys are shuffled in order to ensure that particular users cannot be identified once a transaction has taken place.
bit.ly/2JSshY3

Dutch Bank ABN AMRO Abandons Wallie Custodial Bitcoin Wallet Citing Risk Concerns
Adrian Zmudzinski – Cointelegraph
Dutch bank ABN AMRO abandoned its plans to launch a custodial bitcoin (BTC) wallet dubbed “Wallie” because of risk concerns, according to a report published on May 20 by tech news outlet The Next Web. Per the report, the bank’s senior press officer, Jarco de Swart, said in an email to the outlet that the bank decided not to continue its plans after it “concluded that cryptocurrencies because of their unregulated nature are at the moment too risky assets for our clients to invest in.”
bit.ly/2VQPQHS

SEC Commissioner Says Time Is Right for Bitcoin ETFs – 3 Funds Pending
Kevin Helms – Bitcoin.com News
The U.S. Securities and Exchange Commission (SEC) is currently reviewing three bitcoin exchange-traded funds (ETFs), one of which was filed last week to track the prices of two cryptocurrencies. An SEC commissioner said at the Consensus conference on Monday that the time is right for a bitcoin ETF, as the commission is due to make a decision on one of them next week.
bit.ly/2HCwTP1

Ethereum-Based Stock Exchange Plans First Company Listing in June
Yogita Khatri – Condesk
SprinkleXchange, a stock exchange built on ethereum, is reportedly listing its first company next month.
bit.ly/2WSg7BW

OneCoin Claims It’s Not a Ponzi or Pyramid Scheme
Daniel Palmer – Coindesk
The OneCoin cryptocurrency investment project has responded to the suggestion it is a Ponzi or pyramid scheme, arguing it does not fit the narrow definition of either.
bit.ly/2WUUaCa

Politics

The Global Crisis of Democracy; As China and Russia attack free governments and push strongman rule, the U.S. has gone silentóand a new tide of authoritarianism is gathering.
By Larry Diamond – WSJ
There is nothing inevitable about the expansion of democracy. Among countries with populations above one million, there were only 11 democracies in 1900, 20 in 1920 and 29 in 1974. Only for the past quarter of a century has democracy been the world’s predominant form of government. By 1993, the number of democracies had exploded to 77órepresenting, for the first time in history, a majority of countries with at least one million people. By 2006, the number of democracies had ticked up to 86.
/on.wsj.com/2WTfCrx

Deutsche Bank Staff Saw Suspicious Activity in Trump and Kushner Accounts
David Enrich – NY Times
Anti-money-laundering specialists at Deutsche Bank recommended in 2016 and 2017 that multiple transactions involving legal entities controlled by Donald J. Trump and his son-in-law, Jared Kushner, be reported to a federal financial-crimes watchdog.
/nyti.ms/2WPnp9A

Small group of America’s big farms gets bulk of Trump bailout funds; Large operators take lion’s share of money aimed at softening blow of trade wars on farmers
Gregory Meyer and Fan Fei – FT
A tenth of US farm operators have received more than half the money from a federal bailout designed to offset the costs of the Trump administration’s trade battles, data show.
/on.ft.com/2WX3aae

Greenpeace climate-change protesters block off BP offices; Activists encase themselves in containers to demand switch to renewable investment
Anjli Raval – FT
Greenpeace activists have blocked access to BP’s London headquarters, demanding the energy major end new oil and gas exploration and switch to renewable investments.
/on.ft.com/2WUJ8gq

Top U.S. Tech Companies Begin to Cut Off Vital Huawei Supplies
Ian King, Mark Bergen, and Ben Brody – Bloomberg
The impact of the Trump administration’s threats to choke Huawei Technologies Co. reverberated across the global supply chain on Monday, hitting some of the biggest component-makers.
/bloom.bg/2JRXKJN

Trump’s tariffs are equivalent to one of the largest tax increases in decades
Steve Liesman – CNBC
President Donald Trump, having championed one of the larger tax cuts in recent years, has now enacted tariffs equivalent to one of the largest tax increases in decades.
/cnb.cx/2WOxBPH

Toyota Rebukes Trump for Sending Message That Carmaker ‘Not Welcomed’ in U.S.
Chester Dawson – Bloomberg
Japanese company criticizes national security threat finding; Warns consumers will be biggest losers if quotas are imposed
Toyota Motor Corp. rebuked President Donald Trump’s declaration that imported cars threaten U.S. national security, signaling contentious talks are ahead for the White House and America’s key trading partners.
/bloom.bg/2X1evWR

Donald Trump Reportedly Makes Policy Based On How Many Twitter Likes He Gets
Tom Nicholson – Esquire
It’s been a little while since there was a truly heinous or hilarious Twitter meltdown from Donald Trump, but it turns out that according to reports, Trump has started basing his decisions as president on how many likes he gets on there. Yikes.
/yhoo.it/2HoL4Zh

Regulation

FCA investigations into City directors rise sharply; Complaints about ‘non financial’ behaviour soar at insurers and banks
Caroline Binham – FT
The number of top brass of financial companies being investigated by the UK’s watchdog has more than doubled in two years, with nearly half of those being scrutinised for failings in culture and governance.
/on.ft.com/2WU9oaP

ASIC Chair issues ‘fairness challenge’ at Annual Forum
ASIC
The 24th ASIC Annual Forum in Sydney on 16-17 May 2019 saw more than 950 delegates attend 13 sessions on how financial market participants can meet community expectations when dealing with other people’s money.
bit.ly/2WT1oXp

ESMA publishes translations for Guidelines on the application of the endorsement regime for CRAs
ESMA
The European Securities and Markets Authority (ESMA) has issued today the official translations of its Guidelines on the application of the endorsement regime under Article 4(3) of the Credit Rating Agencies Regulation.
bit.ly/2WPplyS

CTCI Migration Production Testing for TRACE AND ORF
FINRA
FINRA currently supports three methods for the reporting of transactions to its TRACE and Over-The -Counter Reporting (ORF) products – FIX, Computer-to-Computer Interface (CTCI) and TRAQS. As announced in August 2018, beginning in early first quarter 2020 FINRA will no longer support the CTCI protocol (CTCI/TCP; CTCI/MQ) for both TRACE and ORF transaction reporting. Any client, including Service Bureaus, that currently utilize CTCI and wishes to continue to deliver electronic transactions (i.e. not via TRAQS) needs to migrate to the FIX protocol by Monday, February 3, 2020.
bit.ly/2WPJIw0

FCA investigates 30 pension advisers
Maria Espadinha – FT Adviser
The Financial Conduct Authority is currently investigating 30 unnamed individuals and firms for poor pension transfer advice and scams, according to Labour MP Nick Smith.
bit.ly/2WUQVL2

Investing and Trading

ESG accelerates into the investment mainstream; Chart of the week: 40 per cent cite demand from clients as the driver
Chris Flood – FT
The use of environmental, social and governance metrics was a niche activity a decade ago but issues ranging from climate change to executive remuneration and the gender pay gap have accelerated the integration of ESG into investment portfolios.
/on.ft.com/2X19DRz

Funds survey the wreckage of a debt-fuelled energy bust; Deep distress in parts of the oil and gas market drags the sector down
Joe Rennison – FT
The latest earnings call from HalcÛn Resources ended abruptly last week. The struggling Houston-based energy company cut things off after just 10 minutes, leaving no room for any questions from analysts.
/on.ft.com/2WU9cID

Credit quality declines at big US business lenders; Sudden rise in non-performing loans comes despite low rates and strong growth
Robert Armstrong – FT
The quality of big US banks’ commercial lending portfolios is deteriorating for the first time in nearly three years, leaving investors to wonder whether there is worse to come should the ebullient economy slow.
/on.ft.com/2X2LyJK

Overstock CEO lambastes critics of stock sale
Carleton English – NY Post
Overstock Chief Executive Patrick Byrne blasted investors who questioned his recent stock sale, calling their criticism “gauche” and vowing never to defend his selling again.
/nyp.st/2WVR7JZ

Mr. Market Just Got Inside Your Head. Don’t Let Him Mess With You; Investors should get used to big stock-price moves, like Monday’s 600-point drop in the Dow, because they’re here to stay
By Jason Zweig – WSJ
When stock markets fall sharply and immediately recover, the losses seem to disappear. But that doesn’t mean no one feels any pain.
/on.wsj.com/2WTnZDb

Institutions

Deutsche Bank Shares Hit All-Time Low; Fresh investor doubts emerge over investment bank and broader strategy ahead of German lender’s annual meeting
Jenny Strasburg – WSJ
Deutsche Bank AG’s shares traded at an all-time low Monday just weeks after talks with Commerzbank AG failed. Now bank officials, facing fresh investor doubts about the lender’s ailing investment bank and overall strategy, are bracing for a barrage of criticism from shareholders at the bank’s annual meeting Thursday in Frankfurt.
/on.wsj.com/2WWrGbg

Pimco’s Ties to Architect of College-Admissions Scam Ran Deep; Before ex-CEO Douglas Hodge turned to William ‘Rick’ Singer, another executive at the bond giant had recommended the admission counselor’s services
Justin Baer, Melissa Korn and Gregory Zuckerman – WSJ
Pacific Investment Management Co. is facing its most turbulent stretch in five years. Two months ago, the nationwide college-admissions scam implicated the firm’s former chief executive. Since then, Pimco’s staffóand even clients of the firmóhave learned that the central figure of the scam gave presentations on site to employees at one of the world’s biggest bond managers.
/on.wsj.com/2WU9yir

Deutsche Bank Top Investor BlackRock to Outsource Voting at AGM
Eyk Henning, Donal Griffin and Steven Arons – Bloomberg
Deutsche Bank AG’s largest single shareholder won’t vote on the performance of management and supervisors at the bank’s annual general meeting on Thursday.
/bloom.bg/2WZwfBW

Britain’s Metro Bank completes vital capital raise to patch up finances
Iain Withers, Pamela Barbaglia – Reuters
Embattled British lender Metro Bank has raised 375 million pounds of vital capital to shore up its finances just hours after launching a discounted funding round on Thursday.
/reut.rs/2X1cQ3z

UK investors brace for more dividend cuts; Overall payouts to rise this year but at much slower rate than 2018
Cat Rutter Pooley and Owen Walker – FT
When Vodafone cut its dividend by 40 per cent last week, it joined a growing number of FTSE 100 groups that have inflicted pain on shareholders. In February, Marks and Spencer, another stock popular with retail investors, said it would drop its payout by the same amount. In both cases the cuts marked a stark shift in policy: M&S had not cut its payout in a decade, while Vodafone had held off for almost 20 years.
/on.ft.com/2WWvhGi

Deutsche Bank loses head of FX trading business in Europe; Amedeo Ferri-Ricchi, a key revenue generator, resigned this week
Paul Clarke – Financial News
The head of Deutsche Bank’s foreign exchange business in Europe, the Middle East and Africa, which has been spared from deep investment bank cuts over the last 12 months, has left.
bit.ly/2WZFKB6

Trian Nears Settlement With Legg Mason, Could Get 3-to-4 Board Seats; Activist hedge fund pressed the money manager to cut costs and improve marginsóand said a proxy fight was possible
By Cara Lombardo, Justin Baer and Juliet Chung – WSJ
Money manager Legg Mason Inc. is nearing a settlement with Trian Fund Management LP that would give the activist hedge fund three or four seats on its board and avoid a proxy fight, according to people familiar with the matter.
/on.wsj.com/2WTfKav

Regions

Japan’s Blossoming 2.1% Growth Stuns Economists, but It’s Not All Roses
Megumi Fujikawa – WSJ
The Japanese economy unexpectedly grew in the first quarter of 2019 supported by government spending, although there were some worrying signs connected to the U.S.-China trade dispute. The economy expanded an annualized 2.1% during the January-March period, following 1.6% revised growth in the previous quarter. Most economists had forecast that the first-quarter figure would be flat or slightly negative.
/on.wsj.com/2VCDspI

SNB Is Prepared to Intervene in Currency Markets, Official Says
Nick Rigillo – Bloomberg
The Swiss National Bank stands ready to intervene in currency markets if necessary, according to one of its policy makers.
/bloom.bg/2WPlIZM

Czech Banks Agree to Share Profits With State to Avoid Extra Tax
Krystof Chamonikolas and Lenka Ponikelska – Bloomberg
Czech banks have avoided a threat of special taxes for the industry by agreeing in principle to contribute a portion of their profits to a national development fund proposed by Prime Minister Andrej Babis.
/bloom.bg/2WTZYfp

A $19 Billion Test Is Coming Straight for China’s Battered Yuan
Tian Chen and Ran Li – Bloomberg
Offshore-listed Chinese firms will buy FX to pay dividends; Trade dispute has dragged the yuan to weakest level of year
China’s yuan, already battered by the U.S. trade dispute, will soon have a catalyst for further depreciation.
/bloom.bg/2ElqjM9

Oil traders try to ship dirty Russian crude to Asia
Florence Tan, Olga Yagova – Reuters
Trading companies Vitol and Unipec are sending around 700,000 tonnes of contaminated Russian oil to Asia in an attempt to place the barrels rejected by buyers in Europe, according to trading sources and ship tracking data.
/reut.rs/2WOvhIt

Palladium boom gives South African miners only temporary reprieve
Zandi Shabalala – Reuters
A surge in palladium prices has thrown struggling South African mining companies a lifeline. But it may not be enough.
/reut.rs/2WTmIvT

Exxon evacuates foreign staff from Iraqi oilfield
Aref Mohammed, Hadeel Al Sayegh – Reuters
Exxon Mobil has evacuated all of its foreign staff, around 60 people, from Iraq’s West Qurna 1 oilfield and is flying them out to Dubai, a senior Iraqi official and three other sources told Reuters on Saturday.
/reut.rs/2WTrUjy

Venezuela Sells $570 Million From Gold Reserve Despite Sanctions
Patricia Laya – Bloomberg
People familiar with situation say Maduro skirting sanctions; Maduro needs gold money to fund imports, buy military loyalty
Venezuela sold about $570 million in gold from central bank reserves over the past two weeks, skirting U.S. Treasury sanctions designed to freeze assets of the Nicolas Maduro’s administration, according to people with knowledge of the matter.
/bloom.bg/2WUTdd4

Brexit

Cabinet in no-deal Brexit row as Tories face election drubbing; May’s allies warn that leaving EU without agreement could lead to UK break-up
George Parker – FT
Theresa May’s cabinet is heading for a new row over planning for a no-deal exit, amid warnings from the prime minister’s allies that a disorderly Brexit could lead to the break-up of the UK and serious economic harm.
/on.ft.com/2WZxxwM

Brexit: Theresa May plans ‘bold offer’ to get support for deal
BBC News
Theresa May has said a “new and improved” Brexit deal will be put to MPs when they vote on the EU Withdrawal Agreement Bill in early June. Writing in the Sunday Times, Mrs May said the bill will be a “bold offer”. Cabinet minister Rory Stewart told the BBC he hoped extra guarantees on workers’ rights would enable “sensible” Labour MPs to support the government. But Jeremy Corbyn said Labour would oppose the bill and it was “very difficult” to see it making progress.
/bbc.in/2VH1lwI

Brexit mess is about to get much, much worse
Luke McGee – CNN
On May 23, the UK’s Brexit mess gets even more complicated. Nearly two months since Brexit was supposed to happen, Brits will elect candidates to represent them in the European Parliament.
/cnn.it/2WWhsI6

Leave.EU founder confirms he funded Nigel Farage in year after referendum
BBC News
Nigel Farage received £450,000 from the founder of pro-Brexit group Leave.EU in the year after the Brexit referendum. Items paid for by Arron Banks included Mr Farage’s London home, his car and trips to the US to meet Donald Trump. A spokesman for Mr Banks confirmed the amount and what it had been used for, saying it was an “honour to help”.
/bbc.in/2LXpHmd

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?)

“John Lothian and Company… our industry intelligence.”

Rick Lane

CEO, Trading Technologies

Past Newsletters

LSE Rejects Hong Kong Exchange’s Surprise $36.6 Billion Bid

Get a FREE 90 day trial of John Lothian Newsletter First ReadJohn Lothian News Announces Promotions, Staff Addition; Sarah Rudolph Named Editor-in-Chief; Suzanne Cosgrove Joins JLN StaffJohn Lothian News today announces several promotions,...

London Stock Exchange poised to reject £32bn Hong Kong bid

Get a FREE 90 day trial of John Lothian Newsletter First ReadCFTC v Thakkar: a fishing licenseThom Thompson - John Lothian NewsJitesh Thakkar, the Chicago computer programmer charged with aiding and abetting a market manipulation by supplying...

Hong Kong Exchange Makes Surprise $36.6 Billion Bid for LSE

Get a FREE 90 day trial of John Lothian Newsletter First ReadHKEX and LSE, A Capitalist's ConundrumJim Kharouf, JLNToday's bid by Hong Kong Exchanges & Clearing (HKEX) to buy the London Stock Exchange Group for $36.6 billion is a conundrum...

Investors Bet on Big Gains by Gold, Silver

Get a FREE 90 day trial of John Lothian Newsletter Observations & InsightThe Spread - In/StabilityJohnLothianNews.comIt appears Congress still has us little old options folks on the radar as the Options Market Stability Act is back in...

Pin It on Pinterest

Share This