On 9/11, Split-Second Decisions by Employees at ICAP Affected the Rest of Their Lives

Sep 8, 2021

First Read

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Hits & Takes
John Lothian & JLN Staff

The JLN team had a debate this morning over what should be the lead story: the 9/11 story that features Chris Ferreri, a former ICAP executive, or the story about Coinbase getting a Wells Notice from the SEC. The latter has a chilling effect, not just on Coinbase, but the entire sector. The 9/11 story is one of many 9/11-themed stories published this week because of the upcoming 20th anniversary of that terrible day. The 9/11 story was selected for its people angle. Both are deserving of being read.

Join Eurex and BNP Paribas for a fireside chat on MCSI derivatives on Thursday, September 9, from 9:00 a.m. to 9:30 a.m. CDT. The webcast covers the recent developments of Eurex’s MSCI futures and provides color on the upcoming September roll, as well as quantitative analysis and trade implementation. The webcast is designed exclusively for buy-side professionals and is not intended to be investment advice. For more details and to register, go HERE.

Trading Technologies won its patent case against Interactive Brokers that dates back to 2010 and involves issues first disclosed in a story broken by JLN. The jury decided the infringement was not willful, and thus not subject to enhanced damages. The jury did award TT $6,610,985, which was a far shot from what TT was hoping for. IB stated in a press release that it continues to believe it did not infringe. — InteractiveBrokers

Adlai E. Stevenson III, the ex-senator and scion of a formidable political family, has died at the age of 90. His grandfather, Adlai E. Stevenson, was Grover Cleveland’s 1890s vice president. His father, Adlai E. Stevenson 2d, was the eloquent Illinois governor (1949-53) who won his party’s presidential nomination in 1952 and 1956. Stevenson III served a decade in the U.S. Senate and then lost two races for Illinois governor. — NY Times

There were no new donations to the JLN MarketsWiki Education GoFundMe campaign yesterday.

Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL


Beginning September 27, CME will be introducing Basis Trade at Index Close (BTIC) on CME cryptocurrency futures (on Bitcoin, Ether and Micro Bitcoin). They are quoted in basis terms and will enable CME’s clients to get trade or get exposure to the basis (spead) between the price of the futures and the underlying indexes to manage risk better, the exchange said. A video of Tim McCourt, CME Group Global Head of Equity Index and Alternative Investment Products, explaining how BTIC at CME works is available here. More information on Basis Trade at Index Close on CME crypto futures, including an overview video and FAQs, is also available at www.cmegroup.com/cryptobtic.~SR

The U.S. Climate Action Network said Tuesday it has joined the Climate Action Network International in calling for the postponement of the 2021 in-person United Nations Conference of the Parties (COP26). They say vaccine inequality — unequal global access to COVID-19 vaccines — makes it too expensive, or impossible, for some countries to attend, which would hinder the progress of the talks. The conference, which is still likely to go forward, is scheduled for November 1, in Glasgow, Scotland. A Fortune editorial offers a longer discussion of the issue here. ~SC


Interactive Brokers Issues Statement on Patent Trial Verdict
Interactive Brokers
Interactive Brokers Group (Nasdaq: IBKR) today announces that a jury has returned a verdict in a patent trial in which Trading Technologies International, Inc. (“Trading Technologies”) had accused IBG LLC and its wholly-owned subsidiary Interactive Brokers LLC (together “IBG”) of willfully infringing its patents. Although the jury found that IBG infringed two patents owned by Trading Technologies, the jury recognized that any infringement by Interactive Brokers was not willful, and therefore not subject to enhanced damages. The jury awarded $6,610,985 to Trading Technologies, an amount far less than it had sought in damages.

***** The statement includes this: “IBG continues to believe that Trading Technologies’ patents are invalid, and even if valid, that IBG’s BookTrader module did not infringe the patents.” ~JJL


SEC needs to find a way to curb payment for order flow; It’s not clear whether PFOF reduces costs for retail investors, or simply makes their costs less transparent
Sheila Bair – FT
Securities and Exchange Commission chair Gary Gensler has cast a long-needed spotlight on the practice of brokers selling their retail orders to makers of markets outside of regulated, public exchanges. Typically, these are “dark pools” — private exchanges run by large financial institutions — or “wholesalers” such as Citadel and Virtu that execute orders internally.

***** Transparency on costs is a good thing. ~JJL


Commodity Markets Are All Gummed Up; Commodities are a favorite play at times of high inflation, but there are unusual risk factors right now
Nathaniel Taplin – WSJ
Commodities are a favorite play during periods of high inflation, but the market—particularly for metals like copper and steel—is undergoing some unusual contortions. Buyers should be aware that they are betting on Chinese climate policy and global trade bottlenecks as much as supply and demand. Even given that commodities are notoriously volatile and speculative, the recent sharp divergence among industrial metals—whose prices typically move more or less together—has been striking. Steel is up sharply. The iron ore used to make it is down. Copper, after marching higher throughout late 2020, has been muddling through since May. Aluminum, meanwhile, keeps setting 10-year highs.

***** Step right up and trade commodities, if you know the risks.~JJL


How 9/11 Changed Pop Culture in America; Sept. 11 created a fresh appetite for straightforward, unironic beauty, with treatments of the attacks still trickling into popular entertainment years later
Terry Teachout – WSJ
Wishful thinking is a chronic affliction of pundits on a deadline. I suspect that I was suffering from a slight case of it when, four months after 9/11, I wrote a column for The Wall Street Journal called “Tawdriness in Turnaround.” Struck by the fact that Diana Krall’s “The Look of Love,” an album of traditional pop standards, was the eighth biggest-selling CD of any genre on Amazon.com—I had just heard the title track playing in a McDonald’s on New York’s Upper West Side—I speculated that the horrors of that day had awakened in Americans an appetite for straightforward, unironic beauty. “What we wanted in our time of need,” I wrote, “was beauty—and we never doubted for a moment that such a thing exists.”

***** The world changed after 9/11. The world.~JJL


Tuesday’s Top Three
Our most-read story Tuesday was The Taliban invited The Telegraph to tea, and issued a chilling warning to the West, from The Telegraph, which was our No. 3 story on Monday. Second was Postponing a Return to Office Gets Companies Nowhere, an opinion piece from Bloomberg. And third was a related story, Toss the Clorox Wipes, Stock Up on Masks to Be Safe at Work, from the Wall Street Journal. (The headline is misleading – it doesn’t say to “toss the Clorox wipes,” it says Clorox wipes may not be enough.)


MarketsWiki Stats
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MarketsWiki Statistics


Lead Stories

On 9/11, Split-Second Decisions by Employees at ICAP Affected the Rest of Their Lives; Thousands of people working in the World Trade Center had moments to decide: Vacate an office or remain? Take a stairwell up or head down?
Gregory Zuckerman – WSJ
On the afternoon of Monday, Sept. 10, 2001, Karen Lynn Seymour told her boss that she wanted to attend a conference the next morning. The 40-year-old technology specialist at a subsidiary of ICAP, a London-based bond broker, thought it could help her career. Her boss, Chris Ferreri, said he was less interested in the event, to be held at Windows on the World, a restaurant on the 106th floor of the World Trade Center’s North Tower.

Coinbase Gets Wells Notice From the SEC on Lend Product
Olga Kharif and Joanna Ossinger – Bloomberg
Coinbase Global Inc. was warned by the Securities and Exchange Commission against launching a product that would allow consumers to earn interest on their crypto holdings. The U.S.’s biggest cryptocurrency exchange said it received a Wells notice saying the agency will bring an enforcement action if the company goes ahead with its Lend product. Coinbase expressed surprise at the SEC’s move, in a blog post, adding it plans to delay the launch at least until October.

Here’s Why Most People Don’t Risk Using Bitcoin as a Currency; The digital token’s 17% plunge — in a matter of minutes — on the day El Salvador adopted it as legal tender shows the risks of using it as legal tender.
Alice Kantor – Bloomberg
Salvadorans are learning why the rest of the world doesn’t use Bitcoin as a currency for everyday transactions. El Salvador became the first country to adopt the digital token as legal tender on Tuesday, with the government’s Bitcoin wallet Chivo coming pre-loaded with $30 worth of the currency for users who register with a national ID number.

For Chobani, Allbirds, Other Coming IPOs, Greed Is Out. Do-Gooding Is In; Fall lineup including Rent the Runway, Warby Parker aims to highlight more than just the bottom line
Corrie Driebusch – WSJ
Forget Gordon Gekko. The hottest companies launching IPOs are branding themselves as do-gooders. A new generation of companies, including startups such as Rent the Runway Inc., Chobani LLC, Warby Parker Inc. and Allbirds Inc., are on tap to go public this fall, people familiar with the matter say. They’ll be doing it with this message: It isn’t just about the money. It is also about the mission.

SEC threatens to sue Coinbase over lending product; Cryptocurrency exchange’s chief accuses US regulator of ‘sketchy behaviour’
Hannah Murphy – FT
The US Securities and Exchange Commission has warned that it will sue Coinbase if it launches a new digital asset lending product, and also issued subpoenas to the cryptocurrency trading platform to provide it with more information, according to executives.

El Salvador’s bitcoin debut stumbles over tech problems; Digital currency’s price falls during closely watched rollout of Central American country’s new legal tender
Christine Murray – FT
El Salvador’s pioneering adoption of bitcoin as legal tender hit snags within hours of the launch on Tuesday after the government had to take its app for storing the volatile digital asset temporarily offline and the global price slumped. Around dawn local time, President Nayib Bukele said on Twitter that the digital wallet app called “Chivo” — Salvadoran slang for cool — would stop working while server capacity was increased.

Digital Currencies Pave Way for Deeply Negative Interest Rates; If people can’t hoard physical money, it becomes much easier to cut rates far below zero
James Mackintosh – WSJ
Investors have been ignoring progress toward government-issued electronic money, even as many countries are progressing rapidly toward their own online cash. They should ask two questions: Will the Federal Reserve issue a digital dollar? And will it eventually replace physical bank notes?

TradeTech FX 2021: FX buy-side using fewer counterparties due to oversight; Speaking at this year’s TradeTech FX event, Aegon Asset Management’s Kirstie MacGillivray said the level of data needed to maintain oversight of a counterparty had risen significantly.
Annabel Smith – The Trade
The buy-side is increasingly limiting itself to fewer sell-side counterparties in the FX markets due to the rising level of due diligence required to maintain oversight of them. Speaking at TradeTech FX 2021, Kirstie MacGillivray, head of multi-asset trading at Aegon Asset Management, told the panel that due to the level of ongoing oversight required to onboard, and then oversee a counterparty, Aegon preferred to use a limited pool of sell-side firms.

The Simple Problem That Sank Greensill’s Complex Financial Empire; The former fintech darling took in money from investors seeking safety and used it for risky loans. It all collapsed in a crisis of confidence.
Lucca De Paoli, David Rocks – Bloomberg
Every company has a genesis story, a tale to give customers and investors something simple to latch onto, even when the business is new or hard to understand. Tech pioneer Hewlett-Packard was started by a couple of electronics tinkerers in a garage. EBay, on its way to introducing the idea of online auctions, had a (made-up) yarn about someone looking for a better way to collect Pez dispensers. Theranos peddled its (allegedly made-up) finger-prick blood test technology with a story about founder Elizabeth Holmes being afraid of needles as a child.

Morningstar Acquires Moorgate Benchmarks to Fuel Indexing Growth and Disruption; Acquisition enhances Morningstar’s ability to provide customized, personalized index solutions and underscores global expansion, particularly in Europe.
Morningstar, Inc.
Morningstar, Inc. (Nasdaq: MORN), a leading provider of independent investment research, today announced the acquisition of Moorgate Benchmarks, a privately held European-based global provider of index design, calculation, and administration. ETFS Capital provided seed funding to Moorgate Benchmarks in 2019 and had been its sole external investor. With this transaction, Moorgate Benchmarks becomes a wholly owned subsidiary of Morningstar. Financial terms were not disclosed.

Court rules that former HKEX executive and consultant accused of bribing him must stand trial; Defendants’ lawyers had asked the judge on Wednesday to rule that there was no case to answer to and to dismiss the trial
Enoch Yiu – South China Morning Post
Richard Lum Chor-wah, 61, has been charged with paying a bribe to a former official of HKEX. Photo: Nora Tam
A former executive of Hong Kong’s bourse operator in charge of vetting listings and a consultant charged with offering him HK$9.15 million (US$1.18 million) in bribes have a case to answer to, a court ruled on Wednesday.

BlackRock raises $1bn for first foreign-run China mutual fund; Asset manager presses ahead with expansion into savings market despite concerns over Beijing’s tech crackdown
Thomas Hale – FT
BlackRock has raised Rmb6.7bn ($1bn) for its first mutual fund in China, as the world’s biggest asset manager presses ahead with its expansion into the country’s lucrative savings market despite concerns over the political climate.

Credit Suisse appoints new compliance chief after Greensill and Archegos crises; Overhaul at top of bank continues as it attempts to move on from scandals
Tabby Kinder – FT
Credit Suisse has appointed a new chief compliance officer five months after the Swiss lender jettisoned at least seven senior executives in the wake of twin crises at Archegos Capital and Greensill Capital.

Dallas Fed’s Robert Kaplan Was Active Buyer and Seller of Stocks Last Year; Eleven of the Fed’s 12 regional banks have provided disclosures of their leaders’ 2020 financial profiles in recent days
Michael S. Derby – WSJ
Federal Reserve Bank of Dallas President Robert Kaplan made multiple million-dollar-plus stock trades in 2020, according to a financial disclosure form provided by his bank, in contrast with other regional Fed leaders who reported more modest financial holdings and smaller transactions.

Business Travelers, Expect More Zooms and Few Trips This Fall; Companies are greenlighting trips for client meetings and closing deals, but internal gatherings and training are mostly staying virtual for now
Scott McCartney – WSJ
The return to work isn’t happening as expected this fall. The same is true for work travel. Business travel has remained stymied by the pandemic, even as people take to the skies in droves for vacations. Hopes for a rebound in business travel this fall have deflated with the spread of the Delta variant of Covid-19.

The New ‘Shadow’ Banks; The crypto revolution is bringing financial services to the unbanked, but not without risks.
Andrew Ross Sorkin, Jason Karaian, Sarah Kessler, Stephen Gandel, Lauren Hirsch, Ephrat Livni and Anna Schaverien – NY Times
Cryptocurrency is transforming the way people save and borrow money, and a slew of new businesses are popping up to provide services that resemble bank offerings. But this fast-growing crypto-finance sector has officials in Washington worried, The Times’s Eric Lipton and DealBook’s Ephrat Livni report.

Americans Say They’re Now Less Likely to Work Far Into Their 60s
Alexandre Tanzi – Bloomberg
Americans say it’s increasingly unlikely that they’ll work deep into their 60s, according to new data from the New York Federal Reserve. The share of respondents expecting to work past the age of 62 dropped to 50.1% in the New York Fed’s July labor-market survey, from 51.9% a year earlier — the lowest on record in a study that’s been conducted since 2014. The numbers saying they’re likely to be employed when they’re older than 67 also dropped, to 32.4% from 34.1%.


How Delta Is Bolstering the Case for Covid Boosters
Jason Gale – Bloomberg
Covid-19 booster shots are being rolled out in some countries in response to waning antibody levels in already vaccinated individuals, and the increased threat posed by the hyper-infectious delta variant of the coronavirus that causes the disease. Giving a third shot to healthy people is a contentious strategy, since many low- and middle-income countries have yet to immunize even a 10th of their population. From a scientific standpoint, though, there’s mounting evidence that it could help stem transmission of the pathogen.

Top Pfizer scientist defends Covid vaccine booster push and jab’s potency; Philip Dormitzer says company opted for low-dose shot to avoid side effects
Nikou Asgari – FT
Pfizer’s top scientist has dismissed criticism that the company is pushing the widespread administration of Covid-19 booster shots too aggressively and denied it should have developed a more potent jab to stave off “breakthrough infections”.

Scientists work on antiviral pills to prevent pandemics; Artificial intelligence is used to design treatments that aim to disable viral threats
Hannah Kuchler – FT
Scientists are using artificial intelligence to design antiviral pills that could treat Covid-19 and stop potential pandemics in their tracks, a drive that has enabled an Oxford start-up to secure funding for its drug development programme from the Gates Foundation.

What is the Nipah virus and why is it more deadly than COVID-19? A virus expert explains.
Asha C. Gilbert – USA TODAY
Officials in India are racing to contain a virus outbreak that has claimed the life of a 12-year-old boy and is deadlier than COVID-19 — the Nipah virus. CBS News reports the boy was taken to the hospital last week in the southern Kerala state with a high-grade fever and suspected brain inflammation. After blood tests, he was diagnosed with the Nipah virus and died Sunday.

U.S. Reaches 75% of Adults With at Least One Vaccine Dose
Josh Wingrove – Bloomberg
Biden to outline new strategy against pandemic on Thursday; Administration preparing to begin Pfizer booster shots
Three-quarters of U.S. adults have received at least one dose of a Covid-19 vaccine as of Tuesday, according to the White House, setting a new milestone in the country’s fight against the pandemic.

Exchanges, OTC and Clearing

ICE Introduces Weather Forecast Data and Analytics on ICE Connect® Platform
Allows customers to see how changing weather patterns influence market prices
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE: ICE), a leading global provider of data, technology and market infrastructure, today announced the launch of its weather forecast data on its ICE Connect platform. ICE Connect users can now access a first in kind ability to connect streaming weather data to streaming tick information, making it easier for customers to see how changing weather forecasts influence live market prices.

Euronext announces September 2021 quarterly review results of the AEX® Family
Euronext today announced the results of the quarterly review for the AEX®, AMX® and AScX®, which will take place after markets close on Friday 17 September 2021 and be effective from Monday 20 September 2021.

Euronext announces volumes for August 2021
Euronext, the leading pan-European market infrastructure, today announced trading volumes for August 2021.

Uncleared Margin Rules and FX: Eurex offers solutions to a complex affair
Phase 5 of the Uncleared Margin Rules (UMR), which came into effect in September 2021, is expected to drive buy-side demand for FX futures and OTC FX clearing since these offer a viable alternative to the bilateral OTC market. However, UMR and FX is a complex story. To understand it in full, we asked Archana Varshney, Head OTC FX Sales and Business Development at Eurex, for an explanation that was as simple as possible.

Eurex Exchange Readiness Newsflash | Decommissioning of FIX Gateway 4.2 trading sessions and FIX Gateway back office sessions on 1 October 2021
With this Newsflash we would like to remind you about the upcoming decommissioning of the FIX Gateway 4.2 trading session and FIX Gateway back office sessions on 1 October 2021.

Deutsche Börse wins Barbara Roth as Head of Group Audit
Deutsche Börse
Barbara Roth will move from her position as Chief Compliance Officer at UniCredit Bank AG as Managing Director Group Audit to Deutsche Börse on January 1, 2022.

TMX Group CEO John McKenzie to present at the Barclays Global Financial Services Conference
TMX Group Chief Executive Officer John McKenzie will present at the virtual Barclays Global Financial Services Conference.

Analysis of Disclosure in “Basic Policy Regarding Selection of Accounting Standards” [Companies whose FYs ended by Mar. 31, 2021]
Tokyo Stock Exchange, Inc. has released its analysis of disclosure in “Basic Policy Regarding Selection of Accounting Standards” for companies whose fiscal years ended by Mar. 31, 2021.

— Initial Listing of Monday and Wednesday Weekly Options on E-mini® Russell 2000® Index Futures (European-Style) Contracts — CME
— Amendments to the Strike Price and Listing Schedule for Options on E-mini Russell 2000 Index Futures Contract — CME
— CME OTC IRS Margin Model Parameter Change – Effective September 13, 2021 — CME
— End of Clearing Support for CHF/GBP/JPY LIBOR FRAs – Effective September 13, 2021. — CME
— CME CORE Margin Calculator Enhanced User Interface Live and Futures & Options Calculator Decommissioned September 12, 2021 — CME
— New Product New Product Summary: Initial Listing of Monday and Wednesday Weekly Options on E-mini® Russell 2000® Index Futures (European-Style) Contracts – Effective October 04, 2021 — CME


Egyptian fintech MNT-Halan lands $120M from Apis Partners, DisrupTech and others
Tage Kene-Okafor – TechCrunch
Over 70% of Egypt’s young and fast-growing population of over 100 million is financially underserved despite mobile penetration exceeding 90%. Traditional banks often overlook this segment because of their spending power or financial status and fintechs have seized the opportunity to cater to their needs.

PayPal to acquire buy now, pay later provider Paidy for $2.7bn; Japanese fintech group that pioneered zero-interest payments in the country was expected to list this year
Dave Lee and Kana Inagaki – FT
PayPal, the US online payments company, has agreed to acquire Paidy, a Tokyo-based buy now, pay later group, for ¥300bn ($2.7bn) in the latest shake-up in the industry.

Eventus closes on $30 million Series B funding round
Eventus Systems
Proceeds to fuel further global growth and new capabilities
Eventus Systems, Inc., a leading global provider of multi-asset class trade surveillance and market risk solutions, today announced that it has closed on a $30 million Series B funding round, led by Centana Growth Partners. Also participating in the round were DRW VC, an arm of principal trading firm DRW, CMT Digital, existing investors Jump Capital and LiveOak Venture Partners, along with several new strategic investors.

Tradefeedr partners with PrimeXM to distribute data and analytics; PrimeXM will distribute Tradefeedr’s data and analytics solutions via its XCore technology stack.
Annabel Smith – The Trade
Foreign exchange trading data platform Tradefeedr has partnered with PrimeXM to distribute its data and analytics solutions. The news follows the trading data platform raising $3 million in a funding round led by private investment firm IPGL that would see it modernise its trading analytics workflows.

BBVA expands global equities business with two new trading and sales hubs; The expansion further advances the bank’s growth plan and follows its strategy to build a global investment product franchise.
Wesley Bray – The Trade
BBVA Corporate and Investment Banking has opened two trading and sales hubs, it’s the latest move to expand its equities business for institutional and corporate clients. The new hubs will be located in Hong Kong and in New York, further advancing the bank’s growth plan and following its strategy to build a robust, diversified and global investment product franchise.

How trustworthy are investment apps like Charles Schwab and Robinhood?
Rickie Houston – Insider
In May, Robinhood faced user retaliation due to a cryptocurrency trading outage that occurred while dogecoin prices skyrocketed. While the investment app fully restored crypto trading, its server issues prevented many users from placing dogecoin orders.


Experts Uncover Mobile Spyware Attacks Targeting Kurdish Ethnic Group
Ravie Lakshmanan – The Hacker News
Active since at least March 2020, the attacks leveraged as many as six dedicated Facebook profiles that claimed to offer tech and pro-Kurd content — two aimed at Android users while the other four appeared to provide news for the Kurdish supporters — only to share links to spying apps on public Facebook groups. All the six profiles have since been taken down.

Notorious Russian Ransomware Group ‘REvil’ Has Reappeared
William Turton and Kartikay Mehrotra – Bloomberg
The infamous criminal ransomware group behind the JBS SA cyberattack has returned to the dark web after vanishing this summer. “REvil,” short for “Ransomware-Evil,” is among the most prolific cyber gangs to hold data for ransom. The group operates from Russia, according to cybersecurity firms and the U.S. government, and is accused of leading a flurry of attacks this year against companies and organizations, including JBS. The giant Brazilian meat supplier eventually paid an $11 million ransom.

Airbus, Alstom to Partner Against Growing Cyber Risks to Trains
Tara Patel – Bloomberg
The French plane and train manufacturers signed a cooperation agreement to provide security systems to rail operators, according to a statement Wednesday. The move comes as cross-country networks and urban metros and trams become increasingly reliant on software.

Another cyber attack on NZ businesses – analysis
Kiwi bank and ANZ along with New Zealand Post, Inland Revenue and Metservice all experienced blacks-out due to a cyber-attack earlier today.
Checkpoint – RNZ
Cyber attackers took down multiple New Zealand websites and services today in what appears to be a co-ordinated hit. Kiwi bank and ANZ customers also reported problems with internet banking and being locked out of their accounts. And the government’s computer emergency response team CERT NZ confirmed it’s monitoring multiple denial of service attacks

The Cybersecurity 202: Ransomware threats barrel back after a slow Labor Day
Joseph Marks and Aaron Schaffer – The Washington Post
The Labor Day weekend concluded without any cyber catastrophes. But once the long weekend’s festivities were over, cybercriminals hit with a one-two punch:
The REvil ransomware gang, which launched two of the most devastating attacks this year before disappearing in July, suddenly reemerged.
Howard University in Washington, D.C., was hit with a major ransomware attack, which forced the historically Black university to cancel classes and likely heralds a coming barrage of similar attacks against universities and K-12 institutions as the school year kicks off.


Bitcoin bruised after chaotic debut as legal tender in El Salvador
Bitcoin licked its wounds on Wednesday, a day after its heaviest losses in 2-1/2 months as El Salvador’s historic adoption of the crypto asset as legal tender caused chaos online and on the street.

Bitcoin Nurses Losses in Wake of El Salvador’s Glitched Rollout
Joanna Ossinger – Bloomberg
Bitcoin nursed losses Wednesday after plunging amid El Salvador’s troubled rollout of the largest cryptocurrency as legal tender. The virtual coin was trading near $46,150 as of 6:31 a.m. in New York, having slid as much as 17% a day earlier before paring some of the losses. The downdraft also swept across tokens such as Ether and Dogecoin, as well as the Bloomberg Galaxy Crypto Index.

NBA’s Steph Curry Seals FTX Crypto Pact Similar to Tom Brady’s
Vildana Hajric and Sebastian Tong – Bloomberg
Curry receives equity stake in FTX, becomes brand ambassador; ‘Just getting started in the crypto game,’ he tweeted Monday
That’s some start in crypto. A day after tweeting that he was just getting into crypto and soliciting advice, basketball star Stephen Curry announced a partnership with FTX, the fast-growing crypto platform run by Sam Bankman-Fried.

“Cryptocurrencies and NFTs will soon become a core part of the gaming industry”: Zeyan Shafiq of Stalwart Esports
Abhishek Mallick = sportskeeda
The conversation around the adoption of blockchain technologies in video games and esports has been gaining a lot of steam in recent years. While some of the major organizations have partnered up with crypto exchange firms, the global phenomenon of “crypto adoption” is yet to achieve mainstream popularity in some of the world’s developing regions. In a conversation with Abhishek Mallick of Sportskeeda Esports, Zeyan Shafiq, founder at Stalwart Esports, opens up about the importance of “decentralization” in gaming, and how the esports industry can benefit from the adoption of blockchain technology.


US security reviews now extend to Chinese acquisitions never filed with government
Jodi Xu Klein – South China Morning Post
A little over a week ago, Magnachip Semiconductor was notified by the US Treasury Department that it had identified national security risks in the Delaware chip company’s proposed US$1.4 billion sale to Chinese private equity firm Wise Road Capital. Soon after, the department would recommend US President Joe Biden block the deal.

U.K. Blinks First on Covid Deficits With Tax at 70-Year High
David Goodman – Bloomberg
Parliament to vote Wednesday on $17 billion charge for workers; Plan has been criticized as regressive, carries political risk
The U.K. is set to take the lead among developed economies by raising new taxes that will help trim pandemic budget deficits, an issue that’s likely to dominate policy debate across the world in the coming years.

How China Has Stacked the Deck in Hong Kong Elections
Jenni Marsh – Bloomberg
Replacing Hong Kong’s leader is a complicated, closed-door affair that epitomizes the central problem facing the Asian financial hub: How to balance the public’s desire for autonomy with China’s demands for control? The city’s Basic Law, which came into effect the day the British left, contains the promise of a popular vote some day, but electoral reforms imposed from Beijing in 2021 made that goal even more distant. In the end, the successor to Chief Executive Carrie Lam will be chosen in 2022 by an elite group of just 1,500 people who represent business, interest groups and, above all, China’s Communist Party.

Calls grow for delay to UN climate summit amid pandemic; Civil society groups say Glasgow COP26 faces ‘vaccine apartheid’ and logistical hurdles
Leslie Hook – FT
More than 1,500 civil society groups joined a growing chorus demanding the postponement of the UN climate change conference on the basis that the UK government has been too slow in providing vaccines to delegates.

Adlai E. Stevenson III, Ex-Senator and Scion of Formidable Political Family, Dies at 90; The Illinois Democrat served a decade in the United States Senate: “It was ordained at birth that I would go into a life of public service.”
Robert D. McFadden – NY Times
Adlai E. Stevenson III, a scion of generations of Illinois Democrats, who shared the names and presidential ambitions of his father and great-grandfather but not their political successes, serving a decade in the Senate and losing two races for governor, died on Monday at his home in Chicago. He was 90.


Hong Kong watchdog still watching IPO sponsor banks, has several open cases
Hong Kong’s markets watchdog expects to penalise more brokers for misconduct over listings in the financial hub, particularly smaller firms, its enforcement director said on Wednesday, despite some large fines levied recently.

Bridgepoint’s ‘carry’ shows limit of UK rules; Regulators should demand full disclosure of executive rewards
The editorial board – FT
The fair and efficient functioning of markets is achieved through transparency. A basic tenet of capitalism is that shareholders make informed decisions about the true performance of a public company, and the incentives of its executives, only if they have all material information. The ability of Bridgepoint — which this summer became the first private equity firm to list on the London Stock Exchange since 1994 — to not disclose the total amount of money its executives take home makes a mockery of the system. Bridgepoint has flouted no rules, and indeed its prospectus was approved by the financial regulator. But that points to a systemic flaw that needs fixing if the UK’s markets are not to attract companies that want to reap all of the benefits of a listing without its obligations.

WA company director banned from managing corporations for four years
Robert Francis Brady of Mosman Park, Western Australia, has been disqualified from managing corporations for four years for his involvement in three failed companies.

Colonial First State liable for misleading superannuation members
The Federal Court has made declarations that Colonial First State Investments Limited (Colonial), as trustee for the Colonial First State FirstChoice Superannuation Trust (FirstChoice Fund), made false or misleading representations and engaged in misleading and deceptive conduct when communicating with members.

ASIC extends time for companies to hold annual general meetings
ASIC has today formally extended the time public companies have to hold their annual general meetings.

Cboe Global Markets Reports August 2021 Trading Volume
Cboe Global Markets
Cboe Global Markets, Inc. (Cboe: CBOE), a leading provider of global market infrastructure and tradable products, today reported August monthly trading volume statistics across its global business lines.
The data sheet “Cboe Global Markets Monthly Volume & RPC/Net Revenue Capture Report” contains an overview of certain August trading statistics and market share by business segment, volume in select index products, and RPC/net capture, which is reported on a one-month lag, across business lines.

ESAs highlight risks in phasing out of crisis measures and call on financial institutions to adapt to increasing cyber risks
The three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) issued today their second joint risk assessment report for 2021. The report highlights the increasing vulnerabilities across the financial sector, the rise seen in terms of cyber risk and the materialisation of event-driven risks.

PODCAST: Make Your Voice Heard: FINRA’s Regional Committees
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Investing and Trading

Investors are ignoring the parallels between stocks today and ‘heady’ years of 1929, 1999 and 2007. Do this next, says strategist.
Barbara Kollmeyer – MarketWatch
Post Labor Day sees investors returning to the S&P 500 SPX, -0.41% near all-time highs and some dark economic shadows lurking. Chiefly in the worry corner is Friday’s weak jobs data, which comes against backdrop of higher prices, leading to whispers of dreaded stagflation.

Morningstar Acquires Moorgate Benchmarks to Fuel Indexing Growth and Disruption
Acquisition enhances Morningstar’s ability to provide customized, personalized index solutions and underscores global expansion, particularly in Europe.
Morningstar, Inc. (Nasdaq: MORN), a leading provider of independent investment research, today announced the acquisition of Moorgate Benchmarks, a privately held European-based global provider of index design, calculation, and administration. ETFS Capital provided seed funding to Moorgate Benchmarks in 2019 and had been its sole external investor. With this transaction, Moorgate Benchmarks becomes a wholly owned subsidiary of Morningstar. Financial terms were not disclosed.

Investor who returned 4,000% in Q1 2020 explains what people get wrong about risk mitigation
Julia La Roche – Yahoo Finance
Hedge fund manager Mark Spitznagel, the founder of $11 billion “Black Swan” hedge fund Universa Investments, says investors have been getting risk mitigation wrong from the start. “Our goals are even wrong. And really, we have Modern Portfolio Theory to thank us for this. But it’s just kind of a heuristic of investing that you need to take more risk in order to get higher returns, in order to get more wealth at the end of the day. And as you take less risk, your returns are going to go down,” Spitznagel told Yahoo Finance Presents in a rare interview to discuss his second book, “Safe Haven: Investing for Financial Storms,” which he describes as his firm’s “manifesto.”

Force Majeure at Top Fertilizer Plant Has Prices Soaring
Elizabeth Elkin – Bloomberg
Fertilizer prices are soaring after the world’s largest nitrogen facility had to declare a force majeure. CF Industries Holdings Inc. said on Sept. 3 that it can’t fill orders from its Donaldsonville, Louisiana, nitrogen complex, which was closed ahead of Hurricane Ida, according to a letter seen by Bloomberg. That’s stoking fears of production losses at a time when supplies are already tight.

Uranium Surges to Six-Year High as Fund Buys Up Physical Supply
Stephen Stapczynski – Bloomberg
Rally intensified after Sprott began aggressive uranium buying; Strong fundamentals also lifting uranium futures higher
Uranium, the commodity used to fuel nuclear power plants, has surged to the highest level since 2015 due in part to a single fund aggressively cornering the physical market.

Advisers cancel fees to reduce pension transfer redress, warn lawyers; FCA does not routinely check whether guidance is followed on payouts for unsuitable transfer advice
Josephine Cumbo – FT
The Financial Conduct Authority is being urged to review compensation awarded for unsuitable pension transfer advice after the City watchdog raised concerns over how advisers were calculating redress.

Largest US crude oil export hub sold to Enbridge as part of $3bn deal; Pipeline company bets on strong North American energy supplies despite drilling pullback
Justin Jacobs and Myles McCormick – FT
Enbridge, the Canadian pipeline company, is betting on sustained strength in US energy production with a $3bn purchase of assets including a crude oil export terminal in Texas that is North America’s largest by volume.

Farmer sentiment improves in August, but inflationary concerns mount
CME Group
The Purdue University/CME Group Ag Economy Barometer improved in August, up 4 points to a reading of 138. The modest rise was attributable to improvements in both of the barometer’s sub-indices. The Index of Current Conditions rose 9 points to a reading of 152 and the Index of Future Expectations rose 2 points to a reading of 132. The Ag Economy Barometer is calculated each month from 400 U.S. agricultural producers’ responses to a telephone survey. This month’s survey was conducted between August 23-27, 2021.

Worried about inheritance tax? Read this if you’re a beneficiary, executor or trustee
Bill Bischoff – MarketWatch
A loved one has passed away, and you’re an inheriting heir and maybe the estate executor or trustee to boot. What happens now tax-wise? Good question. This the first installment of our series covering the most important tax-related considerations for heirs when a loved one departs.

Environmental, Social and Corporate Governance

Wall Street’s ESG Loans Charge Corporate America Little for Missed Goals; Banks and borrowers are rushing to add sustainability targets to loans, yet for many deals the incentives are all but meaningless.
Michael Tobin and Davide Scigliuzzo – Bloomberg
When American Campus Communities Inc. announced the signing of a $1 billion sustainability-linked credit line in May, its executives decided to take a victory lap. For the first time, they said, the company was tying its borrowing costs to targets ranging from improved energy efficiency to workforce and boardroom diversity. The largest owner of college apartments in the U.S. even put out a press release touting its commitment to environmental, social and governance goals.

Spain Is the Opening Act for the EU’s Big Green Autumn; The bloc could have stronger standards for its climate-friendly bonds but it is still providing a beacon for companies anxious for leadership.
Marcus Ashworth – Bloomberg
Nothing says the European summer is over and business is restarting like a blowout sovereign bond sale. Tuesday’s inaugural green bond launch for the Kingdom of Spain certainly fits that bill. The 5 billion-euro ($6 billion) 21-year deal received orders well over 10 times what was on offer. Investors just cannot greenify their portfolios quickly enough. But this is just the first course of what’s on offer for EU green bond issuance come autumn.

This Village in England Is Already Using Hydrogen to Heat Homes
Rachel Morison – Bloomberg
Winlaton in northeast England is using 20% blended hydrogen; U.K. plans to have first town using 100% hydrogen by 2030
A village in northeast England is using hydrogen for heating and cooking, marking a key milestone in Britain’s efforts to find ways to slash climate-warming emissions. Since August, a blend of 20% hydrogen and 80% natural gas has been piped through the public network supplying 668 homes, a school and some small businesses in Winlaton, a village about 7 miles (11 kilometers) east of Newcastle. The project, called HyDeploy, is the first time blended hydrogen has been used on the U.K. grid.

How Wall Street Is Gaming ESG Scores; A good rating doesn’t necessarily mean your investment is doing much good.
Tim Quinson – Bloomberg
There are vast inconsistencies between the stated climate objectives of money managers and “the reality of their investments.” While perhaps an unsurprising statement given all the reporting on Wall Street greenwashing, this conclusion by Paris-based business school EDHEC is tied to a more nuanced assessment of strategies behind climate-focused funds. While asset managers talk at length about the use of climate data to construct their ESG portfolios, many funds aren’t run “in a manner that is consistent with promoting such an impact,” EDHEC academics wrote in a 65-page report entitled “Doing Good or Feeling Good? Detecting Greenwashing in Climate Investing.”

Violence Against Women Puts Turkey in an Uncomfortable Spotlight; The decision to withdraw from the Istanbul Convention has increased concern about safety and female participation in the economy.
Burhan Yuksekkas, Donna Abu-Nasr – Bloomberg
A woman in Istanbul sent a panicked message to her lawyer: Her ex-husband was on his way to pick up their 9-year-old daughter. He threatened to kill her if she tried to stop him. This was three days after Turkey announced in March that it was pulling out of the Istanbul Convention, a European treaty to combat violence against women. Since then, men have felt more empowered to act without fear of repercussions, says Leyla Suren, the lawyer of the mother who reached out for help.

Deutsche Bank CEO Sees Need to Work on Culture to Ride ESG Boom
Nicholas Comfort and Steven Arons – Bloomberg
Deutsche Bank AG has to do a better job of explaining its role to society to profit from the boom in sustainable investing, Chief Executive Officer Christian Sewing said, in some of his first public comments since allegations of greenwashing against the firm’s money management unit were revealed.

Brussels to issue ‘Covid green bonds’ as part of pandemic recovery effort; EU wants to become world’s biggest issuer of environmentally friendly debt
Mehreen Khan and Tommy Stubbington – FT
Brussels is to issue its first Covid-19 green bond as part of its efforts to become the world’s biggest issuer of sustainable debt. The European Commission on Tuesday said it would tap debt markets for a sale of green bonds in October, raising funds for environmentally friendly reforms and investment in EU member states as part of the union’s pandemic recovery effort.

‘Diesel vs doughnuts’: new biofuel refineries shake up US food industry
Energy companies tap into vegetable oil and fat supplies in pursuit of renewables targets
Emiko Terazono and Justin Jacobs – FT
A search for lower-carbon motor fuel is pitting food companies against the energy industry over tightening supplies of a humble commodity: vegetable oil. Fuel refiners including Marathon Petroleum and ExxonMobil are adding “renewable diesel” to their product mix in response to government incentives for cleaner fuels. The raw materials are typically edible oils extracted from plants or animal fat.


BlackRock raises US$1 billion with first Chinese mutual fund even as George Soros calls China investment a ‘tragic mistake’
Chad Bray – South China Morning Post
BlackRock, the world’s biggest asset manager, said on Wednesday that it had raised 6.7 billion yuan (US$1 billion) with its first mutual fund in China, with the announcement coming just days after billionaire investor George Soros called its investment in the country a “tragic mistake”.

Europe Bank Chiefs Step Up Integration Calls as U.S. Gap Widens
Steven Arons and Nicholas Comfort – Bloomberg
Deutsche Bank’s Sewing slams Europe for keeping banks small; Santander’s Botin urges capital markets, banking union
Top European bank executives urged lawmakers to move past deadlocks that have held up the bloc’s project for a unified banking and capital market and hampered their ability to compete with Wall Street peers.

JPMorgan to Take Majority Stake in Volkswagen Payments Platform
Marion Dakers – Bloomberg
Bank will buy 75% holding and target ‘wallet of the future’; No financial terms disclosed for deal due to close in 2022
JPMorgan Chase & Co. is buying a majority stake in Volkswagen AG’s payments platform, extending its services further into the auto industry. The U.S. bank said it will acquire close to 75% of Volkswagen Payments SA in a statement Wednesday. It plans to work with the car manufacturer to develop the platform for new markets that could use internet-connected vehicles as a way to pay.

Credit Suisse Names Compliance Chief After Twin Scandals
Marion Halftermeyer – Bloomberg
Lopez Lorenzo to fill last gap left by exit of Lara Warner; Bank separated risk and compliance roles after scandals
Credit Suisse Group AG named Rafael Lopez Lorenzo as chief compliance officer, filling the last gap left by the exit of Lara Warner after the twin hits from Greensill Capital and Archegos Capital Management.

Citi names new co-heads of local markets trading; Newly promoted co-heads of local markets trading have been with Citi for nearly 60 years collectively, The TRADE can reveal.
Annabel Smith – The Trade
Citi has promoted two of its own to become its new co-heads of local markets trading, according to an internal memo seen by The TRADE. Richard Lancaster and Jose Luis Yepez have been promoted as co-heads of the division after serving at Citi for 20 years and 37 years respectively.

Broker TP ICAP’s shares plunge to lowest since Nov after first-half profit slide
Aby Jose Koilparambil – Reuters
TP ICAP (TCAPI.L), the world’s largest inter-dealer broker, reported on Tuesday a 35% plunge in half-year profit as trading in its global broking and energy and commodities businesses tailed off from highs seen during the height of the pandemic.


Sweden’s Soaring Property Stocks Spark Handelsbanken Downgrades
Charles Daly – Bloomberg
Equity analysts at Sweden’s second biggest bank have described the country’s real estate industry as “running on fumes” with valuation premiums at an all-time high.

Biggest Abu Dhabi Wealth Fund Expands Foray Into Private Markets
Nicolas Parasie – Bloomberg
The Abu Dhabi Investment Authority is giving itself more room to invest in private markets after a record year of dealmaking for its buyout division during the pandemic. The emirate’s biggest sovereign wealth fund, which oversees assets estimated at $686 billion, has raised its target allocation range for private equity and infrastructure, according to its 2020 annual review released on Wednesday.

Dubai International Financial Centre achieves 2024 Strategy targets ahead of schedule with record 3,292 companies registered in first half 2021
Dubai International Financial Centre
Dubai International Financial Centre (DIFC), the leading international financial hub in the Middle East, Africa and South Asia (MEASA) region, has delivered continued strong growth in H1 2021, with the result that it has achieved its 2024 Strategy growth targets three years ahead of schedule.


Australia’s Top Court Finds Media Companies Liable for Other People’s Facebook Comments; Decision could hinder the promoting of important public-interest journalism, legal experts say
Mike Cherney – WSJ
Australia’s highest court found that newspapers and television stations that post articles on Facebook Inc.’s FB 1.57% platform are liable for other Facebook users’ comments on those posts, a ruling that could prompt traditional publishers to rethink how they engage with social media.

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