Hits & Takes
John Lothian & JLN Staff
CME Group today announced the first trades in its China Portside Iron Ore futures contracts. A total of 500 contracts were traded. No word on when Starboard Side contracts will be offered, I said sternly with a bow.
Boston Scientific was ranked number 50 of 1000 on a list as a Most JUST Company by JUST Capital and CNBC, which reflects the company’s commitment to its employees and the global community. This is good news because it is the company that makes the electronic stimulator that is embedded in my back. I have also bought some stock in the company as a way to keep track of its fortunes.
When bitcoin futures were getting ready to launch on the Cboe and CME, I was approached by some risk managers of FCMs for my take on the products. I had to do some deep thinking about them. I told them bitcoin was a currency default swap. A good example of that today is the headline from the Wall Street Journal “Turks Pile Into Bitcoin and Tether to Escape Plunging Lira; Cryptocurrencies are embraced in Turkey and parts of the developing world where government economic policies spark significant distrust.”
I am going to break my rule to never mention Kim Kardashian in JLN because she is the subject of stories in several publications. She, Floyd Mayweather Jr. and others were sued for an alleged cryptocurrency-related fraud. Kanye believe it?
Bloomberg has a story that says more than half of workers said they would consider quitting if they were forced to go back to the office in the first week of the year.
There are several stories about the investment that Ken Griffin took in Citadel Securities from Menlo Park, Calif.-based Sequoia Partners and San Francisco-based Paradigm, two firms with big investments in crypto. Strange for a crypto skeptic. But then the deal did add $28 billion to his personal bottom line. That gives him a lot more money to buy overpriced real estate.
Covid has come to the Lothian family. I am in quarantine. Time will tell. Be safe.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
Opinion: Citadel’s $1.15 billion cash infusion isn’t a bailout but the final test of Ken Griffin’s ‘Death Star’
Thornton McEnery – MarketWatch
When you add more than a billion dollars’ worth of liquidity to a market maker that already executed more than one of every four trades in the U.S. markets on a daily basis, while simultaneously giving it bleeding-edge access to the fastest-growing asset class in modern financial history, that’s not a bailout. It’s a warning. Citadel Securities announced a $1.15 billion investment from venture-capital giant Sequoia and cryptocurrency investment outfit Paradigm early Tuesday, and it blew a lot of minds, even if some were clearly blown in the wrong direction.
****** Why am I imagining a “Spaceballs” version of this, not a “Star Wars” version?~JJL
Flow Traders Ousts Top U.K. Executive After BlackRock Complaints
Donal Griffin – Bloomberg
BlackRock workers complained about Flow Traders U.K. head; Complaints linked to drunken incident in pub, people say
Flow Traders NV, Europe’s biggest market maker in exchange-traded funds, ousted its top U.K. executive after an alleged drunken incident in a London pub offended employees at key business partner BlackRock Inc., people familiar with the matter said.
***** The old days of what happens in the pub, stays in the pub are over. Now it is you may have to pay the price even if it was not your round.~JJL
Toxic Workplace Culture Is a Bigger Driver of the Great Resignation Than Pay; Company culture was 10.4 times more likely to predict employee attrition than compensation, a new study finds.
Ella Ceron – Bloomberg
Employers scrambling to hold onto workers during the Great Resignation should take a hard look inward. The biggest predictor of employee attrition isn’t pay, a new analysis finds, but toxic workplace culture. Higher wages are certainly an important factor driving millions of people around the world to quit their jobs. But an analysis of more than 1.4 million Glassdoor reviews for companies across 38 industries found that company culture is 12.4 times more likely than compensation to predict whether an employee leaves. This held true for workers in both front-line and so-called knowledge worker jobs.
****** Be nice, play nice. Be real, stay real. Keep it real. Not that hard.~JJL
Web3, Silicon Valley’s New Obsession, Looks a Lot Like Its Last One; Crypto enthusiasts are pitching a decentralized internet. The investors backing their companies have other ideas.
Joshua Brustein – Bloomberg
If you’ve spent any time around the tech industry recently, you’ve probably heard the good news about Web3, the presumed next chapter in internet history. The so-called Web 2.0 era, which was dominated by a handful of social media platforms, is over. Web3 boosters say that instead of relying on Facebook—now rebranded Meta Platforms Inc. to avoid any of the bad vibes associated with social media—we’ll soon be communicating using decentralized services that will make the current fears of censorship by tech monopolies passé.
***** I am waiting for the 3.1 version to come out. The first upgrade is always the best!~JJL
Omicron variant will ‘find just about everybody,’ Fauci says, but vaccinated people will still fare better
Travis Caldwell, Jason Hanna, Deidre McPhillips and Christina Maxouris – CNN
As the Omicron variant spreads like wildfire across the United States, it’s likely just about everybody will be exposed to the strain, but vaccinated people will still fare better, the nation’s leading infectious disease expert said Tuesday. “Omicron, with its extraordinary, unprecedented degree of efficiency of transmissibility, will ultimately find just about everybody,” Dr. Anthony Fauci told J. Stephen Morrison, senior vice president of the Center for Strategic and International Studies. “Those who have been vaccinated … and boosted would get exposed. Some, maybe a lot of them, will get infected but will very likely, with some exceptions, do reasonably well in the sense of not having hospitalization and death.”
****** My family is double vaxxed, boosted and mostly hermits. But Covid found us just the same. Some for the second time.~JJL
Tuesday’s Top Three
Our most-read story Tuesday was the New York Times opinion piece from Paul Krugman, The Strange Alliance of Crypto and MAGA Believers, which yesterday was titled “Crusading for God, Family and … Bitcoin?” Second was Bloomberg’s Is SEC’s Gary Gensler the Skunk at the Fintech Party or the Adult in the Room? (Subtitle: “The regulator who shook up crypto now has his eye on how algorithms might influence investors.”) Third was London Metal Exchange Trading Resumes After Five-Hour Outage, also from Bloomberg.
26,689 pages; 237,058 edits
NinjaTrader Acquires Tradovate; Acquisition of Cloud-Based Trading Infrastructure Further Strengthens Leadership Position in Retail Futures Industry
NinjaTrader Group, LLC, a leading provider of trading software and brokerage services to active traders, today announced that it has acquired Tradovate Holdings, LLC, a leading online futures brokerage firm and trading technology provider, for $115 million. Founded in 2003, NinjaTrader is the industry’s leading retail futures broker supporting over 500,000 traders with best-in-class trading software, award-winning brokerage services, multilingual support, and robust educational programs and resources. Tradovate, launched in 2016 and founded by industry veteran Rick Tomsic, pioneered a cloud-based trading infrastructure and innovative pricing model for futures which helped accelerate the transformation of the brokerage landscape.
FIA Tech expands into the UK with new London-based subsidiary; New office will focus on research and development, as well as servicing UK and European-based clients.
Wesley Bray – The Trade
Technology provider FIA Tech has opened a new London-based subsidiary as the company looks to scale and expand. The London subsidiary, which is based in Paddington, becomes FIA Tech’s fourth office: following Washington DC, New York and Nashville. The new subsidiary is also FIA Tech’s first office outside of the US. “The UK and Europe are core markets for FIA Tech’s customer base and London is a global hub for FinTech innovation,” said Nick Solinger, chief executive of FIA Tech.
HKEX Signs New Strategic Cooperation Agreement with SZSE to Support Greater Bay Area Development
Hong Kong Exchanges and Clearing Limited (HKEX) is today (Wednesday) pleased to announce it has signed a new strategic cooperation agreement with Shenzhen Stock Exchange (SZSE) to further enhance market connectivity and facilitate the development of the Guangdong-Hong Kong-Macao Greater Bay Area. Under this expanded agreement, HKEX and SZSE will work closely together to support the development of Hong Kong and Mainland China’s capital markets. The two exchanges will conduct joint marketing and promotional activities on a regular basis, such as forums and workshops, on relevant topics including Stock Connect, index and derivatives product development and cross-border regulatory updates.
Mad Cow Disease Drives Asian Nations to Halt Canada Beef Imports
Jen Skerritt and Sybilla Gross – Bloomberg
Supply Lines is a daily newsletter that tracks Covid-19’s impact on trade. Sign up here, and subscribe to our Covid-19 podcast for the latest news and analysis on the pandemic. The discovery of a case of mad cow disease has prompted some Asian countries to suspend imports of Canadian beef, a move that could further disrupt the global meat trade already rocked by the Covid-19 pandemic.
IEA chief accuses Russia of worsening Europe’s gas crisis; Fatih Birol says low flows of key fuel coincide with ‘heightened geopolitical tensions over Ukraine’
David Sheppard – FT
The head of the International Energy Agency has accused Russia of throttling gas supplies to Europe at a time “of heightened geopolitical tensions” implying Moscow has manufactured an energy crisis for political ends. Fatih Birol said on Wednesday that the IEA, which represents many big fossil fuel consuming countries, believed Russia was holding back at least a third of the gas it could feasibly send to Europe, while draining Russian-controlled storage facilities on the continent to bolster the impression of tight supplies.
Citadel Securities’ Silicon Valley Funding Hints at Crypto
Yueqi Yang and Katherine Doherty – Bloomberg
Trading firm’s billionaire founder had been a crypto skeptic; Investors Sequoia, Paradigm have digital-asset interests
Citadel Securities LLC’s pursuit of Silicon Valley funding may be as much about billionaire Ken Griffin’s firm finally embracing cryptocurrencies as it is about raising money. The Chicago-based electronic market maker revealed a $1.15 billion investment from Sequoia Capital and Paradigm, two venture capital firms with extensive interests in crypto, hinting at Citadel Securities’ potential entry into the space via firms that can help it gain expertise.
Citadel Securities gets $1.15 billion investment; The deal with Sequoia Partners and Paradigm is the first instance in which Ken Griffin has lined up with institutional outside investors.
Steve Daniels – Crain’s Chicago Business
Two prominent tech-oriented investment firms have made a $1.15 billion investment in Citadel Securities, the market-making firm owned by billionaire Ken Griffin. The deal with Menlo Park, Calif.-based Sequoia Partners and San Francisco-based Paradigm is the first instance in which Griffin has lined up with institutional outside investors. The transaction values Citadel Securities at $22 billion, which likely substantially boosts Griffin’s net worth in Forbes’ next assessment of the world’s wealthiest.
Ken Griffin’s Fortune Soars to $28 Billion on Citadel Securities Deal
Ken Griffin has for years been one of the wealthiest people on the planet thanks to his hedge fund’s success. Now it’s his powerhouse market maker that’s driving the bulk of his fortune to new heights. The billionaire sold a $1.15 billion stake in Chicago-based Citadel Securities to Sequoia Capital and Paradigm, valuing the firm at approximately $22 billion. After the outside investment, Griffin, 53, will own roughly 80% of the trading business, worth about $17.5 billion.
IMF: Crypto not ‘fringe’ anymore, link to stocks may pose systemic risks
Jennifer Schonberger – Yahoo Finance
The International Monetary Fund is warning there is a growing connection between cryptocurrency and financial markets, which poses risks to the financial system. In a report, the international body says digital assets are no longer on the “fringe” of the financial system. Given their high volatility, the rising correlation between cryptocurrencies and stocks could soon pose risks to financial stability— especially in countries that have adopted digital units.
Gary Gensler Faces Union Fight Over Pay as He Moves Ahead With His Agenda
Benjamin Bain – Bloomberg
SEC worker group says chair takes ‘aggressive’ stance in talks; Dispute comes as Gensler set to advance new Wall Street rules
Gary Gensler’s bold push for new rules already has Wall Street on edge. Now, his hard-charging style is fueling a clash with some of the Securities and Exchange Commission’s own employees. The agency’s union took the unusual step of singling out the chair by name last month, accusing Gensler of pursuing “an aggressive, anti-employee agenda” in discussions about pay and benefits. The two sides are now in federal mediation after the worker group demanded an intervention.
London Stock Exchange leads funding round for bond trading start-up; BondCliQ faces stiff competition in forum dominated by investment banks, brokers and trading venues
Philip Stafford – FT
London Stock Exchange Group has led the first funding round for a start-up that wants to reshape corporate bond trading by borrowing a key component from the US stock market.
Citadel Securities valued at $22 bln after investment from Sequoia, Paradigm
Citadel Securities said on Tuesday venture capital firm Sequoia Capital and crypto-focused investment company Paradigm had made a $1.15 billion minority investment in the firm, giving the market maker a valuation of nearly $22 billion. The round was led by Sequoia. Alfred Lin, a partner at Sequoia, will join the board of Citadel Securities, the company said.
Louis Simpson, Buffett’s Onetime Stock Picker, Dies at 85
Louis Simpson, who helped pick stocks for famed investor Warren Buffett as part of a financial career that spanned more than 50 years, has died. He was 85. He died in Chicago on Jan. 8 following a prolonged illness, according to Northwestern University in Illinois, where he had served as a trustee. He and his wife, Kimberly, were residents of Naples, Florida.
The Davos Gang’s Risk List Makes for Depressing Reading; The World Economic Forum’s annual survey shows how little progress we’ve made in tackling the climate emergency.
Mark Gilbert – Bloomberg
The World Economic Forum, arranger of the annual Davos shindig, has just published its 17th annual Global Risks Report. It makes for thoroughly depressing reading — for its context as much as its content. Male, pale and stale remains the defining characteristic of the Davos crowd. Some two-thirds of the more than 900 survey respondents were male, with almost half based in Europe and more than 40% aged 50 or over. More than 40% were business executives, with 16% working in government, 17% in academia and 10% in non-governmental organizations.
Turks Pile Into Bitcoin and Tether to Escape Plunging Lira; Cryptocurrencies are embraced in Turkey and parts of the developing world where government economic policies spark significant distrust
Caitlin Ostroff, Jared Malsin – WSJ
The Turkish lira has become so volatile that Turks have ditched the local currency for assets with an even riskier reputation: cryptocurrencies. While the lira unraveled against the dollar in the last quarter of 2021, cryptocurrency trading volumes using the lira leapt to an average $1.8 billion a day across three exchanges, according to blockchain analytics firm Chainalysis. Those volumes are still modest compared with the results of a 2019 survey by the Bank for International Settlements that found roughly $71 billion of lira transactions a day, but even so are more than any of the preceding five quarters.
The Army of Millions Who Enforce China’s Zero-Covid Policy, at All Costs; As the troubled lockdown in Xi’an has shown, many Chinese people remain willing to work diligently toward the government’s goal of eliminating the virus, no matter the consequences.
Li Yuan – NY Times
China’s “zero Covid” policy has a dedicated following: the millions of people who work diligently toward that goal, no matter the human costs. In the northwestern city of Xi’an, hospital employees refused to admit a man suffering from chest pains because he lived in a medium-risk district. He died of a heart attack.
It’s Not Too Late to Avoid Getting Covid; If you can stay safe for just a couple more months, omicron’s chaos will be behind us.
Faye Flam – Bloomberg
January 2022 is one of the worst possible times to get Covid-19. That’s not only because hospitals are dangerously full, but because after nearly two years of gradually learning more about SARS-CoV-2, the omicron variant has thrust scientists and doctors back into a state of ignorance and guessing. Tests and treatments are in short supply. But this isn’t March 2020 all over again; in fact, the situation is likely to improve dramatically in just a couple of months.
The Web3 You’ve Heard of Does Not Exist; So far it’s mainly a big marketing scheme setting people up for disappointment.
Jessica Karl – Bloomberg
Web3 Has a 5GE Problem
In 2018, a tiny “5G” magically appeared at the top of my iPhone. “Is this actually 5G?” I asked my friends. Nobody had a clue. Prior to this, 5G was merely a fable — something that belonged in a Dave Eggers novel. And then, poof! There it was at the top of my phone. But it turns out it wasn’t 5G at all; it was an AT&T branding scheme. Next to the “5G” was an even tinier “E,” which stands for “5G Evolution” — fancy speak for “we’re still using 4G LTE, but we want you to think we’re winning the 5G race.” Everything is a lie, yada, yada, yada. Four years later, my phone still runs on “5GE,” whatever that is, and AT&T is still running that race.
Singapore Officials Quizzed About Crypto Scams Urge Caution
Joanna Ossinger – Bloomberg
Authorites recommend acting ‘responsibly’ in digital arena; Public advised to deal only with MAS-regulated entities
Singapore officials warned people chasing digital investment opportunities like non-fungible tokens and metaverse assets to exercise caution and participate “responsibly” — a recommendation that mirrors the city-state’s own balancing act as it promises to embrace crypto, but in a measured way.
Crypto Scams Are Biggest Threat to Investors in 2022, Regulators Say
Suzanne Woolley – Bloomberg
Investments tied to cryptocurrencies and digital assets are by far the biggest threats facing individual investors in 2022, according to an annual survey of securities regulators by the North American Securities Administrators Association. Fraud offerings tied to promissory notes, money scams offered over the internet and social media, and frauds involving self-directed individual retirement accounts filled out the NASAA’s list of the top-four threats to the financial health of retail investors.
Crypto Losses Probed by South African Cops After Brothers Vanish
Loni Prinsloo – Bloomberg
Cajees accused of fraud over infamous Africrypt platform; Out-of-pocket investors were compensated by mystery backer
South African police are investigating a number of criminal cases brought by out-of-pocket investors who want two brothers arrested over an allegedly fraudulent cryptocurrency platform. A group of investors are seeking the arrest of Raees and Ameer Cajee, who ran the Africrypt platform, after a number of them were offered some of the lost investment by a Dubai-based mystery investor known as Pennython Project Management LLC. They haven’t been found guilty of any wrongdoing and the probes may come to nothing.
U.S. reports 1.35 million COVID-19 cases in a day, shattering global record
Lisa Shumaker – Reuters
The United States reported 1.35 million new coronavirus infections on Monday, according to a Reuters tally, the highest daily total for any country in the world as the spread of the highly contagious Omicron variant showed no signs of slowing.
South African studies suggest Omicron has higher ‘asymptomatic carriage’
Preliminary findings from two South African clinical trials suggest the Omicron coronavirus variant has a much higher rate of “asymptomatic carriage” than earlier variants, which could explain why it has spread so rapidly across the globe.
Too soon to treat COVID-19 like flu as Omicron spreads – WHO
The Omicron variant of COVID-19 is on track to infect more than half of Europeans, but it should not yet be seen as a flu-like endemic illness, the World Health Organization (WHO) said on Tuesday.
No vax, pay tax, says Canada’s Quebec as health system struggles
Ismail Shakil and Anna Mehler Paperny – Reuters
Quebec, Canada’s second most populous province, is planning to force adults refusing to get COVID-19 vaccinated pay a “health contribution” in a move likely to spur a debate about individual rights and social responsibility. Premier Francois Legault told reporters at a briefing on Tuesday that the proposal, details of which were still being finalised, would not apply to those who cannot get vaccinated for medical reasons. Unvaccinated people put a financial burden on others and the provincial finance ministry is determining a “significant” amount that unvaccinated residents would be required to pay, Legault said, adding that such an amount would not be less than C$100 ($79.50).
U.S. business fears never ending liability from ‘take-home’ COVID-19 lawsuits
Tom Hals – Reuters
As COVID-19 cases surge in the United States, businesses say they fear a California court ruling has increased the likelihood that companies will be sued for infections, even by people who are not employees or customers. The Dec. 21 ruling allowed a wrongful death lawsuit to proceed against See’s Candies Inc, owned by Berkshire Hathaway, by the family of Arturo Ek of Los Angeles who died in April 2020 at 72 from COVID-19.
EU Warns Repeat Boosters Could Weaken Immune System
Irina Anghel – Bloomberg
European Union regulators warned that frequent Covid-19 booster shots could adversely affect the immune system and may not be feasible. Repeat booster doses every four months could eventually weaken the immune system and tire out people, according to the European Medicines Agency. Instead, countries should leave more time between booster programs and tie them to the onset of the cold season in each hemisphere, following the blueprint set out by influenza vaccination strategies, the agency said.
Say Goodbye to Self-Isolating, WFH Mandates, Mass Testing; It’s time to rethink our Covid response to account for higher vaccination rates, natural immunity and milder variants like omicron.
Therese Raphael and Sam Fazeli – Bloomberg
The balance of power between human and virus is shifting. Better armed against a lesser enemy, our species no longer needs to hide in a bunker waiting for a viral wave to pass. That means it’s time for our Covid response to change. As we enter the “endemic” stage of the virus, however, there is confusion about what an updated approach should look like. On Monday, Spanish Prime Minister Pedro Sanchez called for a Europe-wide discussion about developing the kind of response that exists for, say, the flu. The U.K. has extended its “Plan B” rules for another three weeks, but has softened its testing and travel policies and Prime Minister Boris Johnson is under pressure to lift existing restrictions.
The cordon sanitaire is a model for future Covid travel rules; Nineteenth-century quarantine protocols were fairer and better co-ordinated than those in place today
Paul Kreitman – FT
Until recently, I was hopeful that the travel bans introduced last year in response to the Covid pandemic would be quickly reversed. But since the discovery of the Omicron variant, the prospects for international travel look increasingly uncertain. To understand a future of successive virus strains, it helps to look to the past. Two hundred years ago, the cordon sanitaire was the world’s first international travel bubble. This network of permanent quarantine stations was designed to protect Europe from infectious diseases circulating in Africa and Asia. Every traveller entering from these continents had to quarantine for up to a month at designated ports along the Mediterranean coastline, either waiting onboard ship in harbour or in a purpose-built lazaretto (quarantine hotel).
Will Record Omicron Cases Cause a Surge in the Severely Ill? Scientists Look for Signs; Reported U.S. cases and hospital admissions surpass levels seen in last winter’s peak, but ICU stays so far remain below
Josh Ulick – WSJ
The Omicron variant accounted for 98% of Covid-19 cases in the U.S. last week, based on estimates released by the U.S. Centers for Disease Control and Prevention Tuesday. The variant has fueled a rapid rise in infections since reaching the U.S. late last year, surpassing surges associated with earlier versions of the virus and almost eliminating Delta.
Exchanges, OTC and Clearing
CME Group Announces First Trades of China Portside Iron Ore Futures
CME Group, the world’s leading and most diverse derivatives marketplace, today announced that its two new China portside iron ore futures contracts have launched and are available for trading. A total of 500 contracts have traded since launching on January 10, with participation from a number of firms, including ForChi Holding Pte Ltd, Theme International Trading and Trafigura. These trades were brokered by a number of inter-dealer brokers including BPI Financial Group, SSY Futures and Straits Financial Services.
Eurex Exchange Readiness Newsflash | Next Generation ETD Contracts: T7 Release 10.0 Simulation Guide now including Next Generation ETD Contracts specifics
With this Newsflash, we would like to inform you that as mentioned in the Eurex Exchange Readiness Newsflash from 16 December 2021, the T7 Release 10.0 Simulation Guide has been updated and includes the Next Generation ETD simulation specifics.
TMX Group Limited announces release date for Q4 2021 financial results and analyst conference call
TMX Group Limited will announce its financial results for the fourth quarter and year ended December 31, 2021 in the evening of Monday, February 7, 2022. An analyst conference call to review the results will be held at 8:00 a.m. EST on Tuesday, February 8, 2022.
Hong Kong Exchange’s Head of Green Finance Hui Leaves Firm
Kiuyan Wong – Bloomberg
The head of green and sustainable finance at Hong Kong’s bourse left the firm this week after just 20 months in the position. Grace Hui departed the Hong Kong Exchanges & Clearing Ltd. without a clear successor in place, according to people familiar with the matter who asked not to be named because the information isn’t public. Hui confirmed her departure, but declined to comment further. A spokesperson at the bourse declined to comment on employee matters.
Greek stock exchange to trade Bulgarian equity derivatives; The instruments will be traded and cleared in euros
George Georgiopoulos – Reuters News
Hellenic Exchanges EXCr.AT , the operator of Greece’s stock and derivatives markets, said on Tuesday it signed a framework agreement with Bulgaria’s stock exchange (BSE) to trade, clear and settle Bulgarian derivatives.
Regulator’s Column: What issuers and shareholders should be aware of in respect of proxy votes for scheme of arrangement meetings
Mergers and acquisitions (“M&A”) are a feature of the corporate landscape. A common mechanism used to enable an M&A is the scheme of arrangement (“Scheme”). The Scheme is a flexible tool used to effect a compromise or arrangement between the company and its shareholders. A Scheme has three stages under the statutory framework prescribed in the Companies Act (Chapter 50 of Singapore) (“Companies Act”).
Singapore Bourse Set to Start Cobalt, Lithium Contracts in the First Half of 2022
Annie Lee – Bloomberg
The Singapore Exchange plans to launch derivative contracts in battery metals in the first half of this year as demand booms for raw materials that play a crucial role in powering electric vehicles.
— Initial Listing of the 20-Year U.S. Treasury Bond Futures Contract – CME
— Clearing Review of Collateral Haircuts – Effective January 11, 2022 – CME
— Performance Bond Requirements: Interest Rate Margins – Effective January 12, 2021 – CME
— Effective Dates for Spot Month Position Limits in the February 2022 Core Products – CME
— Product Modification Summary: Delisting of Houston Ship Channel Natural Gas (Platts IFERC) Basis Futures Contract – CME
FIA Tech Launches UK R&D And Operations Hub In London
FIA Tech, the futures industry’s leading technology provider, today announced that it has opened a London subsidiary as the company scales and expands. The London office, based in Paddington, is FIA Tech’s fourth office and the first outside the United States, following Washington DC, New York and Nashville.
Industry associations give conditional approval for UK regulator’s sustainability disclosures proposals; ISDA and the IIGCC have suggested the regulator reconsider labels used for sustainable products, including fewer binary distinctions, and taking a principles-based approach.
Annabel Smith – The Trade
Industry associations have offered conditional approval of the UK Financial Conduct Authority (FCA)’s discussion paper proposals on sustainability disclosures. The FCA published a discussion paper in November last year asking for industry feedback on its proposed new disclosures and labelling regime for asset managers and regulated asset owners as part of its Sustainable Disclosure Requirements (SDR).
Ideal partners with Barracuda FX to provide access to analytics and actionable insights; Solutions offered by Ideal will help Barracuda FX clients optimise their trading performance.
Wesley Bray – The Trade
Decision intelligence firm Ideal is now offering its performance and supervisory risk management solutions to clients trading within ION-owned Barracuda FX’s secure environment. Ideal’s partnership with Barracuda FX provides clients with turnkey access to analytics and actionable insights. Ideal claims that its Ideal Flow solution brings an unprecedented level of insight to FX trading.
United Fintech adds Athena to portfolio, completing fourth acquisition in a year to support street’s desire for one-stop-shop; Banks are looking to one-stop-shop solutions to minimise costs and safeguard future buy-side business by digitising client workflows, particularly with Athena, said United Fintech CEO Frahm.
Annabel Smith – The Trade
Start-up United Fintech has completed its fourth acquisition in its first year of business as part of its ongoing expansion and commitment to providing firms across the street with a one-stop-shop solution. The fintech has purchased a 25% stake in US-based Athena Systems, following its three previous acquisitions including London-based trading analytics firm FairXchange, data and API provider NetDania and regtech and capital markets tech provider TTM Zero.
NIST Updates Cybersecurity Engineering Guidelines
Alexandra Kelley – Nextgov
Set against a national backdrop of enhanced cybersecurity risk across all industries, the National Institute of Standards and Technology updated its guidance for system engineers.
Called the “Engineering Trustworthy Secure Systems,” the document stems from President Joe Biden’s 2021 executive order aimed at boosting the federal government’s defenses in the wake of several large-scale attacks on critical infrastructure.
Cybersecurity: Last year was a record year for attacks, and Log4j made it worse
Jonathan Greig – ZDNet
Cybersecurity firm Check Point Research has released new data from 2021 showing that among their customers, there was a significant increase in overall cyberattacks per week on corporate networks compared to 2020.
Researchers attributed some of the increases, which were concentrated toward the end of the year, to the Log4j vulnerability discovered in December. Check Point said in a report that 2021 was a record-breaking year for cyberattacks and the Log4J vulnerability only made things worse.
Today’s top three challenges hindering SMB cybersecurity
Bharath Vasudevan – Security Magazine
To say that 2021 has been a unique year for security is an understatement. While security leaders are hopefully close to having the pandemic under control in their organizations, ransomware is on the rise, the cost of a breach is increasing and many small- and medium-sized enterprises are being forced to put security front and center.
2022 promises to be a challenging year for cybersecurity professionals
Bill Harrod – HelpNewSecurity
I am hopeful that President Biden’s Executive Order 14028 and the Department of Homeland Security’s (DHS’s) Binding Operational Directive 22-01 (BOD 22-01) will help improve our cybersecurity practices and bolster our resilience, especially for mission critical and infrastructure protection. These mandates outline:
Systemic risk seen as potential route to stablecoin regulation; Congress seen unlikely to pass legislation
Peter Feltman – Roll Call
Federal regulators will consider added regulation on issuers of stablecoins if Congress doesn’t act on a recommendation for legislation to restrict the activity to banks, according to both regulators and legal experts. Neither the Securities and Exchange Commission nor the Commodity Futures Trading Commission appears to be planning any related rule-making in the near future, leaving uncertainty in a hot area of financial markets. But government comments late last year raise the prospect that the Federal Reserve could be the most likely entity to take over supervision, at least for some stablecoin activity.
Introducing X-Meta, a Crypto Exchange Powered by Binance Cloud;mX-Meta users will discover a wide range of trading options within the platform’s architecture, while cross-border spot trading liquidity benefits from a robust matching engine, high transaction speeds, and integrated risk control.
X-Meta, the brand-new crypto exchange powered by Binance Cloud which launched on 30th December 2021, will provide customers around the globe with an easy-to-use and highly secure crypto trading exchange service, offering a host of powerful and unique features.
Kim Kardashian, Floyd Mayweather Sued by Investors in EthereumMax Tokens
Peter Blumberg – Bloomberg
Kim Kardashian and Floyd Mayweather Jr. were sued for allegedly scamming investors in a cryptocurrency called EthereumMax. The reality television star and ex-boxing champion were paid to hype the blockchain-based digital tokens to their fans, “causing investors to purchase these losing investments at inflated prices,” according to the complaint filed in Los Angeles federal court. Former Boston Celtic Paul Pierce was also named as a defendant in the suit.
***** Reuters version
SEC Chair Won’t Comment on Whether Ethereum is a Security
Oluwapelumi Adejumo – FX Empire
The chairman of the US Securities and Exchange Commission, Gary Gensler, during a recent interview has refused to be drawn into conversations about if Ethereum is an unregistered security or not.
Crypto regulation ‘is still the biggest overhang’: strategist
Jennifer Schonberger – Yahoo Finance
Bitcoin (BTC), Ethereum (ETH-USD), and other cryptocurrencies continued to growl into 2022 in a bear market after partying to new highs last fall. According to one market strategist, regulation could continue to put pressure on cryptocurrencies.
Julius Baer-Backed Crypto Banking Platform Raises Almost $120 Million
Joanna Ossinger – Bloomberg
SEBA Bank AG, which runs an online bank focused on digital assets, raised 110 million Swiss francs ($119 million) in a funding round, riding a wave of investor enthusiasm that’s seen record amounts of venture capital flow into the crypto sector.
Coinbase Resolves Systems Issue That Hit Non-USD Accounts
Joanna Ossinger – Bloomberg
Coinbase Global Inc. has resolved an issue where some customers had trouble seeing certain data on their accounts, the exchange said. A portion of customers with non-U.S. dollar accounts had issues seeing their asset balance, Coinbase Support said on Twitter earlier, adding that it might have been affecting trading. Portfolio balances didn’t appear to be affected and funds were safe while they worked on the fix, Coinbase added.
TransUnion Brings Credit Data Checks to Crypto Lending; Credit-reporting firm will let consumers give blockchain companies access through Spring Labs’ ky0x Digital Passport
Sebastian Pellejero – WSJ
TransUnion, TRU 1.96% one of the three major U.S. consumer credit reporting firms, will let consumers give blockchain companies access to their personal credit data through the security firm Spring Labs’ ky0x Digital Passport. Consumers will be able to receive better interest rates when borrowing money from financial-services companies that operate on public blockchains such as Ethereum by providing this information, the companies said.
Scholz Calls Out Unvaccinated Germans for Putting Others at Risk
Birgit Jennen – Bloomberg
Chancellor says not getting inoculated has consequences; Scholz vows to personally throw his weight behind a mandate
Chancellor Olaf Scholz issued a strong appeal for Germans to get vaccinated against Covid-19, saying failing to do so puts others at risk as the nation grapples with the fast-spreading omicron variant. Speaking to parliament on Wednesday, Scholz reaffirmed his support for making shots compulsory for all adults, saying the measure is needed to ensure health-care services don’t get overwhelmed.
Europe Slowly Starts to Consider Treating Covid Like the Flu
Kevin Whitelaw – Bloomberg
New metrics are needed as Covid becomes endemic, Spain PM says; Hospitalization rates remain manageable despite surging cases
Spain is calling for Covid-19 to be treated as an endemic disease, like the flu, becoming the first major European nation to explicitly suggest that people live with it. The idea has gradually been gaining traction and could prompt a re-evaluation of government strategies on dealing with the virus. British Education Secretary Nadhim Zahawi on Sunday told the BBC that the U.K. is “on a path towards transitioning from pandemic to endemic.”
Sweden Unveils $664 Million Aid for Soaring Energy Bills and Blames Russia
Jesper Starn – Bloomberg
1.8 million households to get subsidies for winter months; Minister wants to protect consumers from Russian actions
The Swedish government set aside 6 billion kronor ($664 million) to lessen the impact of soaring power bills on households, saying Russia’s approach to supplying gas to Europe this winter was a major factor in stoking costs last month.
Hong Kong to Establish Plan for New Crypto Regulation by July
Philip Lagerkranser – Bloomberg
Hong Kong’s de facto central bank plans to have a new regulatory regime for crypto assets ready by July, as the city vies with Singapore to become a key hub for the burgeoning sector while at the same time containing risks.
Beware the lure of false precision in the battle over City regulation; Post-Brexit rulemaking could come with new oversight of cost-benefit analysis produced by regulators
Helen Thomas – FT
CBA, depending on the context, stands for cost-benefit analysis or can’t be arsed. The latter, let’s face it, is often true of the former. But there is going to be more of it about — analysis rather than apathy — at least if the government gets its way. Buried in the latest round of consultation about how finance should be regulated after Brexit is a proposal for a new statutory panel to scrutinise the regulators’ assessment of the costs and benefits of their work.
Enrolments for the February sitting of the financial adviser exam close 28 January 2022
The first sitting of the financial adviser exam for 2022 commences 17 February 2022; Do not forget to enrol by 28 January 2022.
To enrol, navigate to the exam booking site on the Financial Advice Hub; Enrolments for the February sitting of the financial adviser exam are now open and will close on 28 January 2022.
SDA-Clarus RFR Adoption Indicator: December 2021
The ISDA-Clarus RFR Adoption Indicator increased to an all-time high of 31.7% in December compared to 26.3% the prior month. The indicator tracks how much global trading activity (as measured by DV01) is conducted in cleared over-the-counter and exchange-traded interest rate derivatives (IRD) that reference the identified risk-free rates (RFRs) in six major currencies. On a traded notional basis, the percentage of RFR-linked IRD comprised 20.8% of total IRD in December compared to 17.7% the prior month.
After Months of Ethics Controversy, Fed’s New Trading Rules Will Be Implemented Soon, Powell Says; Chairman’s comments come after three central bank officials announced resignation plans following reports of their market transactions
Michael S. Derby – WSJ
Federal Reserve Chairman Jerome Powell said Tuesday the central bank is close to finalizing a broad revamp of its ethics rules prompted by criticism of officials’ financial transactions during the coronavirus pandemic. Mr. Powell’s comments came a day after Fed Vice Chairman Richard Clarida said he would resign this week, becoming the third central bank policy maker to step down following questions raised over personal trades.
Investing and Trading
Boston Scientific Leads Industry As a Most JUST Company; JUST Capital and CNBC ranked Boston Scientific as the top company in its industry reflecting its commitment to employees and the global community
CNBC and Just Capital have released their 2021 list of America’s top 100 JUST companies, and Boston Scientific ranked 50 out of nearly 1,000 companies, first among companies in the health care equipment and services industry and number one for workers and the environment in our industry. The JUST 100 list ranks companies on issues that matter most to the American public – such as creating jobs, providing benefits and work-life balance, cultivating a diverse and inclusive workplace, producing sustainable products and building stronger communities.
Plan for Decades of High Commodity Prices, BlackRock Says
Thomas Biesheuvel and Francine Lacqua – Bloomberg
Investor says energy transition to drive higher metals demand; Hambro says mining companies remain undervalued by investors
Commodities prices may stay high for decades as mining companies struggle to keep up with demand from the energy transition, according to BlackRock Inc.’s Evy Hambro. Raw materials, and shares of some companies that produce them, hit record highs last year as massive global stimulus measures underpinned consumption. At the same time, the switch toward a greener world is creating fresh demand for metals such as copper, lithium and nickel.
New Data Suggests WallStreetBets Was An Unreliable Guide To Investment For Most Of 2021 – Stocks Recommended By Reddit’s WSB’s Community Resulted In More Losses Than Returns Last Year
According to new data compiled by European trading and investing platform Capital.com, relying on Reddit’s popular online investment forum, WallStreetBets (WSB), to guide investment decisions was a poor investment strategy for the most part of 2021. According to Capital.com’s research conducted between 21 January and 17 December 2021, the ten most mentioned stocks* on WSB generated negative monthly returns at least 59% of the time during the year, with an average weekly loss of 1.6% and a monthly loss of 6.7%. The losses increased further to 8.2% on a quarterly basis.
Environmental, Social and Corporate Governance
IBM Buys Australian Analytics Firm Envizi in Environmental Push
Michael Tobin – Bloomberg
International Business Machine Corp. has acquired Envizi Pty Ltd, an Australian analytics provider that automates the collection of emissions data, expanding its investments in artificial intelligence to help companies make their operations more sustainable and socially conscious.
Bank of England tells banks to quantify climate risks properly
Huw Jones – Reuters
Banks in Britain should be “ambitious” in properly quantifying risks from climate change or face intervention by regulators if they fall short, the Bank of England (BoE) said on Wednesday.
Hottest ocean temperatures in history recorded last year; Ocean heating driven by human-caused climate crisis, scientists say, in sixth consecutive year record has been broken
Oliver Milman – The Guardian
The world’s oceans have been set to simmer, and the heat is being cranked up. Last year saw the hottest ocean temperatures in recorded history, the sixth consecutive year that this record has been broken, according to new research.
Jefferies’ lucrative SPACs deliver a triple thwack
John Foley – Reuters
Blank-check firms have delivered a windfall for sponsors who set them up, banks who help them to go public, and advisers who counsel them on the acquisitions they’re designed to make. Jefferies Financial (JEF.N) is one firm that created a profitable niche by doing all three. But for all the fees they have generated, reputationally its SPACs are far from a triumph.
Citi to Exit Mexico Retail Banking, Its Biggest Branch Network
Jennifer Surane – Bloomberg
Firm will keep institutional businesses in the country; Mexico remains ‘priority market’ for the bank, CEO Fraser says
Citigroup Inc. is planning to exit retail-banking operations in Mexico — where it has its largest branch network in the world — as part of Chief Executive Officer Jane Fraser’s continued push to overhaul the firm’s strategy.
Morgan Stanley Boosts Paris as Trading Hub With Research Center
Alexandre Rajbhandari – Bloomberg
Bank could hire, relocate 50 staff, person familiar says; Paris becoming EU trading hub as banks, funds seek talent
Morgan Stanley is seeking to add around 50 positions at a new research center that will support its trading activities in Paris, as part of plans to boost its presence in the French capital and double its staff there by 2023.
ExodusPoint Joins Millennium, Citadel in Hunt for Paris Traders
Alexandre Rajbhandari and Nishant Kumar – Bloomberg
U.S. hedge fund started local research office in 2019; Citadel, Millennium also have expansion plans in Paris
ExodusPoint Capital Management is planning to increase its operations in Paris in the coming months, joining peers expanding in the French capital. The hedge fund, which opened a research office in Paris in 2019, is awaiting regulatory approval to start new activities locally, such as discretionary trading, according to people familiar with the matter. The firm will start hiring traders once it gets that approval, said the people, who asked not to be identified because the details are private.
Exclusive: Morgan Stanley to award 20% bonuses to top performers
Scott Murdoch and Kane Wu, Matt Scuffham – Reuters
Morgan Stanley (MS.N) will raise its annual bonus for top-performing staff on Thursday by more than 20%, people with direct knowledge of the matter said, with a dealmaking boom set to usher in bumper payouts by banks this year.
Costa Rica hydro plant gets new lease on life from crypto mining
Alvaro Murillo – Reuters
A small river in the middle of coffee plantations, sugar cane fields and a forest provides energy to a hydroelectric power plant in Costa Rica that feeds hundreds of computers wired up to the cryptocurrency mining business.
Japan’s Mizuho to acquire U.S. private equity agent Capstone, source says
Japan’s No. 3 lender Mizuho to appoint senior executive Kihara as new CEO -source
Yuki Nitta – Reuters
Mizuho Financial Group will appoint senior executive officer Masahiro Kihara as its next chief executive who will be tasked with tackling long-running system failures, a person familiar with the matter said on Tuesday.
Mizuho Financial Group plans to acquire U.S. private equity placement agent Capstone Partners, a person familiar with the matter said, as the Japanese lender looks to beef up its investment banking business. Dallas, Texas-based Capstone helps private equity firms find limited partners to invest in their funds, helping raise capital for global private equity, credit, and infrastructure firms.
Mizuho Bank has another system failure
Japan’s Mizuho Bank has experienced another system failure. Tuesday’s incident was the latest in a series that started last year. The bank says its corporate clients had trouble logging into its online e-banking platform for over 3-and-a-half hours in the morning.
World’s Worst-Performing Bank Lent Billions to China Evergrande
It was once hailed as the future of Chinese banking, a privately run lender that would mint money by outmaneuvering its state-owned rivals. An ill-fated push into property lending has instead turned China Minsheng Banking Corp. into one of the biggest casualties of the real estate debt crisis that’s roiling Asia’s largest economy.
China’s Crackdown Leaves the World’s Biggest Gaming Hub on the Brink; Expiring licenses and pandemic restrictions add to the risks for casino operators in Macau.
Shirley Zhao – Bloomberg
The clock is ticking for casinos in the world’s largest gaming market. The licenses of Macau’s six operators expire in June, two decades after the Chinese city opened its gaming industry to foreign investment. That’s creating the possibility that new players may enter the market in 2022 and other operators could lose their place at the table.
Cathay Pacific hits back after being blamed for Hong Kong Omicron outbreak; City’s leader orders probe of airline as her government battles scandal over karaoke party
Chan Ho-him and Primrose Riordan – FT
Cathay Pacific has hit back after Hong Kong’s leader blamed the airline for the territory’s first Omicron coronavirus outbreak, even as her government battled a scandal over a karaoke party attended by senior officials.