Speedier Wall Street Trades Are Putting Global Finance On Edge

May 20, 2024

First Read

Hits & Takes
John Lothian & JLN Staff

Today we have part three, the final segment, of our Open Outcry Traders History Project interview with George Hanley. Hanley talks about some of the educational and charitable endeavors he has funded to promote trading, ESG and democracy. He also relates how lucky he has been and why he feels compelled to give back.

Your favorite SEC chairman, Gary Gensler, gave a speech to the 2024 Conference on Emerging Trends in Asset Management titled “Jack Bogle, Haystacks, and Putting the Interest of the Clients First.” I expect his advice in buying the haystack and not looking for the needle is similar to the theme of his book about investing, “The Great Mutual Fund Trap: An Investment Recovery Plan.”

On May 17, 2024, the Chicago Mercantile Exchange (CME) and the New York Mercantile Exchange (NYMEX) announced disciplinary actions against several entities for violations of Rule 534, which prohibits wash trades. Tanner Di Lello (CME 23-1664-BC) was fined $10,000 and suspended from accessing any trading floor owned or controlled by CME Group, as well as from direct and indirect access to any designated contract market, derivatives clearing organization, or swap execution facility owned or controlled by CME Group for five business days.

Bright Point Capital Pte. Ltd. (NYMEX 23-1653-BC) received a fine of $75,000. Glencore Singapore PTE Ltd. (NYMEX 22-1588-BC-1) was ordered to pay a fine of $20,000 and disgorge profits amounting to $15,000. Similarly, Hartree Partners Power & Gas Company (UK) Limited (NYMEX 22-1588-BC-2) was fined $20,000 and ordered to disgorge profits of $3,050.

Cboe has a new promotion in London with some Cboe brand cabs.

On Sunday, Jahmal Cole spoke at my church, St. Peter’s United Church of Christ. The founder of My Block, My Hood, My City came to my city, Elmhurst, for the first time. He spoke to our social justice committee and others about his work and life and the kids he works with in the city. I was late to the event as I had a graduation party for a former Scout of mine at the same time, but I did catch the end of the Q&A with Jahmal. Jahmal has been shot twice, once while running on Lake Shore Drive. The bullet just skimmed his skull. The second time was when he was coming out of a school and a car driving by shot at him and hit him in the shoulder. He still has the bullet in his shoulder. He also spoke about how the kids in the neighborhoods in Chicago don’t expect to live past 17 or 18.

He said this is why prom is such a big event. It is like a celebration of living that long. Also, he said death is being marketed to kids as funeral homes have designer (fake) names on coffins and even lights on them to make them look cool. Jahmal also said when he was shot at the school, he was arrested as there was a warrant for him, but they spelled his name wrong. They forgot the H in it. The dude without the H is a pretty crazy dude, Jahmal said.

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


edie kicks off a week of content and online events dedicated to the circular economy, May 20 through May 24. During the week, the UK-based sustainability publisher will publish two reports focused on the circular economy. At the start of the week, edie will publish an “Explains guide” on everything a business needs to know on the subject. That will be followed by a new “blueprint” guide explaining how businesses can eliminate single-use plastics. Learn more and register for edie’s circular economy week HERE. ~SAED

Our most read stories from our previous edition of JLN Options were:
30-year anniversary of Trading Technologies from Trading Technologies via LinkedIn.
Nasdaq to market new options strike listing tech to other exchanges from WatersTechnology.
Ferocious CME copper squeeze presages future turbulence from Reuters. ~JB

Subscribe to the JLN Options Newsletter HERE (it’s free).


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Veteran Trader George Hanley Reflects on Trading Career and Family Legacy in Part Three of Open Outcry Traders History Project Interview

In the third installment of the Open Outcry Traders History Project interview series, veteran trader George Hanley dives deeper into his trading career, family legacy, and the evolution of his business ventures. Conducted by John Lothian News for the MarketsWiki Education series, this segment offers a comprehensive look at Hanley’s experiences and insights from his time on the trading floors.

Watch the video »


A 25-Year-Old BofA Trader Dies Suddenly at Industry Outing; Adnan Deumic worked in the bank’s markets unit in London; ‘We are shocked by the sudden loss’ of colleague, bank says
Katherine Doherty and William Shaw – Bloomberg
A 25-year-old Bank of America Corp. credit trader died suddenly on Thursday night. Adnan Deumic, a credit portfolio and algorithmic trader, collapsed of a suspected cardiac arrest playing soccer at an industry event and failed to respond to medical treatment including CPR, according to a person briefed on the matter. He joined the bank on the global markets team in 2022 after participating in the summer analyst program the previous year. “The death of our teammate is a tragedy, and we are shocked by the sudden loss of a popular, young colleague,” a representative for Bank of America said in an emailed statement. “We are committed to providing our full support to Adnan’s family, his friends and to our many employees grieving his loss.”

***** This is not the expectation at an industry outing. ~JJL


Japan’s Inexperienced Investors Fall for Scams ‘Like Babies’; Japan saw sevenfold increase in money lost in latest quarter; Government to announce measures to counter scams next month
Eddy Duan and Yui Hasebe – Bloomberg
As Japan’s stock market booms, something else is also on the rise in the nation: investment scams. Criminals have been quick to exploit the paradigm shift that’s seen a relatively financially inexperienced population turn to investing, spurred by rising consumer prices and government encouragement to find higher returns for their savings. In the first quarter, Japan saw a sevenfold increase in money lost to investment scams from a year earlier, according to the National Police Agency. The agency began tracking the data in January last year, and the latest statistics show there were 1,700 scams reported in the first three months of 2024, with an average of Â¥13 million ($83,500) lost in each case.

***** AI is only going to make scams more effective. I hope the regulators are upping their game.~JJL


Gaming over? The CFTC’s veerrrry broad definition
The Commodity Futures Trading Commission, a chronicled recipient of Alphaville’s ire, earlier this month proposed a rule change that may ban events contracts from the US derivatives market – potentially ending the multiyear push for options trading on sports games, award ceremonies, and, perhaps most critically, elections. The CFTC’s amendment would expand the types of contracts that can be considered “gaming,” and thus banned under the FTC due to their impact on the “public interest”. As summarised by CFTC Chair Rostin Behnam, with FTAV’s emphasis:

****** Where is the “They are going to push this industry off-shore” argument?


Friday’s Top Three
Our top clicked item on Friday was Trading Technologies’ post on LinkedIn celebrating the company’s 30-year anniversary. Second was our MarketsWiki Page for George Hanley, who was interviewed by JLN for the Open Outcry Traders History Project. Third was our MarketsWiki Page for Trading Technologies.



Lead Stories

Speedier Wall Street Trades Are Putting Global Finance On Edge; Firms of all stripes are preparing for the imminent shift to faster US stock settlement – and the issues it may bring.
Greg Ritchie – Bloomberg
When US markets reopen next Tuesday after the long weekend, everything will likely seem normal. It’s only after the close and in the following days that any cracks are expected to appear. A spike in the number of failed trades, operational glitches and additional costs are among industry fears as the trading process for American securities accelerates, with the time allowed to complete every transaction halved to a single day.

Copper’s Boom Story Has Some Truth – and Lots of Hogwash; The case for higher-for-longer prices is there, but bullish exuberance could use a dose of reality.
Javier Blas – Bloomberg
When Thomas Edison wired his own house in Menlo Park, then a tiny village in New Jersey, he fabricated a primitive cable. As insulation he chose a mix of asphalt, linseed oil and beeswax; for the core, copper wire. Why? The metal is the second-best conductor, only behind the much more expensive silver. Fast forward nearly 150 years and copper remains as central to electricity as it did when Edison lighted the American evening. Now, as the energy transition aims to electrify everything, from driving to heating, copper will be everywhere too. Predictably, it has become the darling of the commodity market1.

Dimon Led Bank CEOs to Fend Off Tougher Capital Rules; Regulators discuss slashing proposed capital requirements in sign of banks’ increasing clout
Andrew Ackerman – The Wall Street Journal
JPMorgan Chase’s Jamie Dimon and other big-bank CEOs played hardball with the Federal Reserve over proposals that the lenders hold more capital. Now, it looks like those tactics are paying off. The Fed and two other federal regulators are moving toward a plan that would significantly lessen a nearly 20% mandated increase in capital for the biggest U.S. banks, according to people familiar with the matter.

Fund Managers Brace for SEC Rejection of Ether-ETF Applications; Most involved expect disapproval order, Bitwise lawyer says; SEC faces May 23 deadline to reject or approve one fund
Emily Graffeo – Bloomberg
Investment companies hoping to launch the first exchange-traded funds based on the Ether cryptocurrency are bracing for disappointment since the Securities and Exchange Commission has yet to signal it’s prepared to green light the products. After months of silence, the US regulator is poised to announce a decision on at least one application for an ETF that invests directly in Ether, the second-largest cryptocurrency, by next week. Some fund companies expect a rejection because their private dialog with the SEC hasn’t been as robust as it had been prior to the approval of spot-Bitcoin ETFs in January, according to two people familiar with the matter, who asked not to be named discussing private conversations.

Business school teaching case study: risks of the AI arms race; Competitive haste raises questions about safe development of the technology. Explore the issues with this dean’s case study
David De Cremer – Financial Times
Prabhakar Raghavan, Google’s search chief, was preparing for the Paris launch of its much-anticipated artificial intelligence chatbot in February last year when he received some unpleasant news. Two days earlier, his chief executive, Sundar Pichai, had boasted that the chatbot, Bard, “draws on information from the web to provide fresh, high-quality responses”. But, within hours of Google posting a short gif video on Twitter demonstrating Bard in action, observers spotted that the bot had given a wrong answer.

London Remains Top Pick in Europe for Financial Investors; Paris Comes Second; Britain drew a third of Europe’s finance projects last year; Paris emerging as the next big destination, challenging London
Charlotte Hughes-Morgan – Bloomberg
London still leads European cities in attracting foreign direct investment in financial services, with the UK’s share of new projects reaching the highest level in a decade, a survey by Ernst & Young showed. London secured 81 projects in 2023, 76% more than the previous year and more than double that of second-placed Paris, which saw a 11% decline, the New York-based consultancy said in a report after a survey of 900 decision makers. It also said the French capital was slowly winning over hearts and is likely to challenge London’s dominance in the coming years.

Roaring Kitty Is the Poster Child for Meme-Obsessed Generation T; Younger investors are much more willing to take risks than their elders.
Marcus Ashworth – Bloomberg
After a long period of calm, all it took to reignite the meme stock flames was a cryptic post last week from “Roaring Kitty” showing a character leaning forward in a chair. That’s the moniker used by Keith Gill, who shot to fame in 2021 as he rallied traders on the social media site Reddit around GameStop Corp. He’s the poster child for Generation-T, a new cohort of younger traders with a markedly different approach to investing than their elders.

London Still Europe’s Share Sale Capital Even With Few IPOs;mShare sales of $11.3 billion dwarf other European cities; UK remains in top spot even after rate hikes spurred downturn
Joe Easton – Bloomberg
London remains Europe’s top venue for sales of shares in listed companies, as a recent raft of secondary deals eclipses a lack of UK initial public offerings. There have been $11.3 billion worth of such share offerings in London so far in 2024, a jump of almost 24% on a year earlier, according to data compiled by Bloomberg. Even after missing out on a nascent revival in IPOs, the volume of share sales in London dwarfs that of any other European exchange.

Millennium Covets Citadel-Size Commodities Gains, Just Not the Risk; The world’s best-paid hedge fund manager wants to build a world-beating commodities business. Insiders say Izzy Englander doesn’t always give his team the runway it needs.
Devika Krishna Kumar – Bloomberg
For years, mega hedge fund Millennium Management watched as one of its closest competitors, Citadel, raked in enviable returns from commodities trading, including a profit of about $8 billion in 2022. Eager to supercharge its own performance, Millennium last year installed Anthony Dewell, the star energy trader of Goldman Sachs Group Inc., as its head of commodities.

Iran’s President Ebrahim Raisi dead in helicopter crash; Aircraft came down on Sunday in remote and mountainous north-west
Bita Ghaffari and Najmeh Bozorgmehr – Financial Times
Iran’s President Ebrahim Raisi has died in a helicopter crash, shocking the nation and fuelling uncertainty at a time of increased tensions in the Middle East. “The Iranian nation has lost a sincere, devoted and valuable servant,” Iran’s supreme leader Ayatollah Ali Khamenei said in a statement on Monday as he declared five days of national mourning.

Re: CPMI-IOSCO Report on Streamlining variation margin in centrally cleared markets -examples of effective practices
CCP Global
The Global Association of Central Counterparties (“CCP Global”) is the international association for central counterparties (“CCPs”), representing 42 members who operate over 60 individual CCPs across the Americas, EMEA, and the Asia-Pacific region. CCP Global appreciates the opportunity to respond to the Report on Streamlining variation margin in centrally cleared markets – examples of effective practices 2 (“the Report”) prepared by the Committee on Payments and Market Infrastructures (“CPMI”) and the Board of the
International Organization of Securities Commissions (“IOSCO”).

Can Chicago’s mayor tackle environmental racism in one of the most segregated US cities? Brandon Johnson promised to address the city’s longstanding inequities – advocates want to make the most of the moment
Aliya Uteuova – The Guardian
On the campaign trail, Brandon Johnson often talked about the asthma he suffered growing up just west of Chicago, connecting it to industrial pollution.”For too long our communities have been seen as dumping grounds for waste and materials that no one seems to know what to do with,” the then mayoral candidate said at an event in the majority-Hispanic neighborhood of Pilsen. When Johnson was sworn in last May, he inherited a city grappling with a host of environmental challenges. In one of the nation’s most segregated cities, communities of color face disproportionate exposure to air pollution, lead and climate risks such as flooding. In 2022, federal investigators found Chicago violated residents’ civil rights by moving polluting industries into communities of color.

U.S. Fears Undersea Cables Are Vulnerable to Espionage From Chinese Repair Ships; Google, Meta Platforms and others partially own many cables, but they rely on maintenance specialists, including some with foreign ownership
Dustin Volz, Drew FitzGerald, Peter Champelli and Emma Brown – The Wall Street Journal
U.S. officials are privately delivering an unusual warning to telecommunications companies: Undersea cables that ferry internet traffic across the Pacific Ocean could be vulnerable to tampering by Chinese repair ships. State Department officials said a state-controlled Chinese company that helps repair international cables, S.B. Submarine Systems, appeared to be hiding its vessels’ locations from radio and satellite tracking services, which the officials and others said defied easy explanation.

Why Cocoa Farmers Are GPS Mapping Where Their Beans Are Grown; A new European Union law that aims to make chocolate more sustainable has left farmers racing to map their plots-and is poised to add to high prices
Alexandra Wexler – The Wall Street Journal
In the central clearing of a steep-sloped cocoa plantation, surrounded by trees dripping with fat green pods, Brice-Armel Konan raised his smartphone toward the sky and saved the coordinates of his location in an app. The farm, he calculated, was 1.4 miles from the nearest forest. “This one should be low risk,” he said. It’s a scene being repeated across the West African nation of Ivory Coast, the world’s largest cocoa producer, as it embarks on a gargantuan experiment meant to make chocolate more sustainable. Its success will determine whether chocolate will become more expensive, on top of some of its highest price increases in the U.S. in recent years.

Toxic ‘forever chemicals’ ubiquitous in Great Lakes basin, study finds; PFAS chemicals present in air, rain, atmosphere and water in basin, which holds nearly 95% of US freshwater
Tom Perkins – The Guardian
Toxic PFAS “forever chemicals” are ubiquitous in the Great Lakes basin’s air, rain, atmosphere and water, new peer-reviewed research shows. The first-of-its-kind, comprehensive picture of PFAS levels for the basin, which holds nearly 95% of the nation’s freshwater, also reveals that precipitation is probably a major contributor to the lakes’ contamination.

*****This story from the Milwaukee Journal Sentinel

Ukraine Invasion

Russia’s glide bombs devastating Ukraine’s cities on the cheap
Joe Inwood and Tania Kharchenko – BBC Newsnight
Russia is increasingly using “glide bombs” – cheap but highly destructive ordnance – to advance its offensive in Ukraine. More than 200 of them are thought to have been used in just a week to pound Ukraine’s northern town of Vovchansk during Russia’s current cross-border advance near Kharkiv.

Russia Freezes Deutsche Bank, Commerzbank, UniCredit Assets; Russian court froze assets under lawsuits totaling EUR1 billion; Assets frozen under lawsuits filed by a Gazprom joint venture
Bloomberg News
A Russian court has frozen the local assets of Germany’s Deutsche Bank AG and Commerzbank AG, and Italy’s UniCredit SpA under lawsuits totaling over EUR1 billion ($1.09 billion) filed by a Gazprom PJSC venture. The Arbitration Court of the St. Petersburg and Leningrad region arrested assets of Munich-registered UniCredit Bank AG and Moscow-based UniCredit Bank AO as part of the suit from RusKhimAlians, according to court documents dated May 16. Stakes in two other Russia-based related companies were frozen, along with real estate and cash in bank accounts.

Virtually Every Sanctioned Russian Oil Tanker Remains Idle and Empty Months After Sanctions; Thirty-nine ships remain sanctioned for breaching a price cap
Julian Lee – Bloomberg
Dozens of tankers remain stuck doing nothing months after being sanctioned by the Treasury Department – a signal of the US’s scope to disrupt Moscow’s petroleum supply chain if it chooses to. Since October, 40 ships involved in Russia’s oil trade have been added to the Treasury’s list of designated entities, mostly for breaching a price cap that’s meant to restrict the Kremlin’s access to petrodollars.

G7 warms to plan for Trump-proofing Ukraine aid; Washington seeks to front-load aid for Kyiv by using profits from Russia’s frozen assets as loan guarantees
Paola Tamma and Henry Foy and James Politi – Financial Times
Washington’s G7 allies are warming to a US plan to rush tens of billions of dollars in funding to Ukraine before Donald Trump’s potential return to the White House. Under the plan, set to be discussed at a June summit, Kyiv would receive money upfront from a G7 loan. The loan would be backed by future profits generated from about $350bn of Russian assets which have been immobilised in the west in response to Moscow’s full-scale invasion of Ukraine.

Israel/Palestine Conflict

Palestinians Struggle for Food and Water After Fleeing Rafah; Many of the 800,000 who left the city huddle in tents on a crowded beach
Chao Deng and Fatima AbdulKarim – The Wall Street Journal
When Ahmad Shweikh and his family moved into a tent near the Mediterranean Sea this month, the young father immediately started searching for water and toilets. The nearest toilet was some 500 yards away, with a wait time of half an hour. So Shweikh dug a hole in front of their tent for his family to use instead. Water flowed from a nearby pipe in the ground once every few days. When it did, Shweikh would rush over with other families. He considered himself lucky if he could fill a bucket that he could then ration for drinking, cooking and cleaning. “It’s a constant battle for survival,” he said. “We want nothing but to live with dignity.”

ICC prosecutor seeks arrest warrants for Israeli and Hamas leaders over alleged war crimes
James Shotter – Financial Times
The International Criminal Court’s prosecutor has sought arrest warrants for five people including Israeli prime minister Benjamin Netanyahu and senior Hamas leaders, saying he had “reasonable grounds to believe” they bore criminal responsibility for war crimes and crimes against humanity.

Exchanges, OTC and Clearing

Nasdaq to market new options strike listing tech to other exchanges; The exchange operator is experimenting with emerging technologies to determine which options strike prices belong in a crowded market, with hopes to sell the tech to its peers.
Emma Hilary Gould – Waters Technology
Last year, Nasdaq began using predictive AI in its US options markets, and now it is looking to sell that tech to others. The exchange operator is in talks with clients to determine if the product, which uses predictive AI to estimate whether an options strike is likely to trade or not, could be used by and sold to other exchanges as part of its market technology business. The initiative, referred to internally as the strike price optimization program, was designed to list options strikes more

ICE hits daily trading record with WTI Midland crude oil future
Luke Jeffs – FOW
The US group said its ICE Midland WTI crude oil futures hit on Monday 100,000 lots traded in one day for the first time while average daily volume in the US crude contract has been 29,000 contracts this month.

HKEX Enhances Swap Connect With CFETS And SHCH
Hong Kong Exchanges and Clearing Limited
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to announce today (Monday) that its clearing subsidiary OTC Clear has implemented three enhancements to Swap Connect in partnership with China Foreign Exchange Trade System (CFETS) and Shanghai Clearing House (SHCH), celebrating the first anniversary of this pioneering derivatives mutual market access programme. The enhancements will provide more flexibility for international investors to manage RMB interest rate risk through China’s onshore interbank markets.

JPXI launches the Scheduled Dates of Earnings Releases Information Service
Japan Exchange Group
As previously announced*, we at JPX Market Innovation & Research, Inc. (JPXI) launched today its data service that provides information on the scheduled dates of earnings releases that listed companies, REITs, and infrastructure funds periodically report to Tokyo Stock Exchange, Inc. (TSE) (hereinafter referred to collectively as “TSE-listed Companies, Etc.”). In addition, SCRIPTS Asia, a wholly owned subsidiary of JPXI, has launched an API of the service to provide both the scheduled dates of earnings releases provided by JPXI along with IR events information such as earnings briefings, a SCRIPTS Asia service.

Publication of JPX Working Paper, Vol.44 “OSE 3-Month TONA Futures and BOJ Monetary Policy”
Japan Exchange Group
Japan Exchange Group, Inc. (JPX) today published JPX Working Paper, Vol.44 “OSE 3-Month TONA Futures and BOJ Monetary Policy”. JPX Working Papers highlight research and studies on changes in the market and regulatory environment with the aim of raising competitiveness. Conducted by officers and employees of JPX, its subsidiaries, and affiliates, as well as outside researchers, JPX Working Papers are intended to draw comments widely from academia, research institutions, and other market participants and observers.


Bloomberg and HKEX enhance Swap Connect solutions to facilitate global investments for IRS market; New developments coincide with latest enhancements applicable to the Northbound Swap Connect scheme, which commence on Monday.
Wesley Bray – The Trade
Bloomberg and Hong Kong Exchanges and Clearing (HKEX) have enhanced their Swap Connect solutions to better facilitate global investments in China’s onshore interbank interest rate swap (IRS) markets. The development coincides with the latest enhancements applicable to the Northbound Swap Connect scheme, which commence today and are introduced by China Foreign Exchange Trade System (CFETS), Shanghai Clearing House, and OTC Clearing Hong Kong.

US stock settlement switch faces early resilience test
Laura Matthews and Sinead Cruise – Reuters
Participants in the United States’ multitrillion-dollar securities markets face an early test of their ability to cope with regulatory reforms to speed up trade settlement, as a major index rebalance scheduled to occur just days after the planned switch risks causing a spike in failed trades. Starting May 28, U.S. stocks and corporate bonds must settle one business day, opens new tab after trading instead of two. Markets in Canada, opens new tab and Mexico, opens new tab are also adopting the reforms, which have been designed to reduce counterparty risk and improve market liquidity.

Quantum Computing Gets Real: It Could Even Shorten Your Airport Connection; Technological advances are letting companies and researchers explore practical uses for quantum computers, such as optimizing airline gate assignments
Bob Henderson – The Wall Street Journal
One day, you might avoid a missed flight connection because of the weird ability of very small particles to act as though they are in two places at once. This bizarre behavior of the subatomic world is what allows so-called quantum computers to perform some calculations far, far faster than their conventional counterparts. It also could soon be helping smooth some problems in our daily lives. Ordinary computers store information as binary digits, or bits, which can be either zeros or ones. Quantum computers use qubits, or quantum bits, which are much richer objects. Their values can be a complex mixture of zero and one because they rely on this behavior of atoms and smaller particles. Qubits can also coordinate their actions with other qubits instantaneously, no matter how far apart they are-a phenomenon that Albert Einstein called “spooky action at a distance.”

AI isn’t coming for your job-at least not yet
Jeremy Kahn – Fortune
When CEOs talk to investors about layoffs, they usually blame economic uncertainty or business “headwinds.” Now a new term is starting to crop up in these announcements: AI. In recent months, shipping giant UPS announced plans to cut 12,000 office jobs that CEO Carol Tome said were unlikely to return because the company was increasingly using AI to automate tasks these workers performed. Meanwhile, financial giant BlackRock said it would eliminate about 600 positions, couching the cuts as an effort to prepare for coming shifts in the asset management industry, of which AI is among several drivers. Then there was Google, which recently laid off ad-sales staff partly because new AI tools were helping customers manage ad campaigns themselves. And IBM CEO Arvind Krishna said Big Blue would pause hiring for 7,800 roles because AI could now do the work instead.

Artificial intelligence companies seek big profits from ‘small’ language models; Microsoft, Meta and Google have released new versions with fewer ‘parameters’ that are cheaper to build and train
Cristina Criddle and Madhumita Murgia – Financial Times
Artificial intelligence companies that have spent billions of dollars building so-called large language models to power generative AI products are now banking on a new way to drive revenues: small language models. Apple, Microsoft, Meta and Google have all recently released new AI models with fewer “parameters” – the number of variables used to train an AI system and shape its output – but still with powerful capabilities.

CloudMargin Achieves Substantial Growth in Revenue for Fiscal Year Ended March 31
CloudMargin, a leading global collateral management technology company, announced today that it achieved 35% revenue growth for the fiscal year ended March 31, 2024, ahead of its annual target. The company saw a rise in the value of new annual contracts signed, along with increased business from existing clients, as automation in collateral management assumed a role of increasing importance in firms’ risk mitigation strategies.

China’s ‘AI-in-a-box’ products threaten Big Tech’s cloud growth strategies; Huawei leads trend of providing companies with means to power their own artificial intelligence apps rather than through public cloud
Ryan McMorrow and Nian Liu – Financial Times
China’s artificial intelligence groups are selling “AI-in-a-box” products for companies to run on their own premises, in a threat to the AI cloud computing services offered by the country’s big tech groups such as Alibaba, Baidu and Tencent. Huawei has signed up more than a dozen AI start-ups to bundle and market their large language models with its AI processors and other hardware. Its partners include groups such as Beijing-based Zhipu AI and language specialist iFlytek.

Google invests 1 billion euros in Finnish data centre to drive AI growth
Alphabet-owned Google will invest a further 1 billion euros ($1.1 billion) into the expansion of its data centre campus in Finland to drive its artificial intelligence (AI) business growth in Europe, it said in a statement on Monday. In recent years, many data centres have been located in the Nordic countries because of the region’s cooler climate, tax breaks and abundant availability of renewable power.

UK working on rules for training of AI models with creative work; Culture secretary Lucy Frazer says focus will be on transparency after media and arts executives voiced concern
Daniel Thomas – Financial Times
UK ministers are working on plans to increase transparency over how tech companies train their artificial intelligence models after the creative industries voiced concerns over work being copied and used without permission or a fee. Culture secretary Lucy Frazer told the Financial Times that the government would bring forward its first attempt to create rules around the use of material such as TV programmes, books and music by AI groups.


Central Bank of Nigeria directs banks to halt 0.5% cybersecurity fees
Adekunle Agbetiloye – Business Insider
The Central Bank of Nigeria (CBN) has instructed banks and other financial institutions to halt the implementation of the 0.5 per cent cybersecurity charges on electronic transactions.

Closing the Skills Gap for Women in Cybersecurity
Kirsten Doyle – TripWire
Cybersecurity is more important than ever. With a skyrocketing number of cyber threats and data breaches, organizations are always on the lookout for ways to strengthen their online defenses. However, one major obstacle the cybersecurity sector faces is a lack of diversity and representation of women. According to Cybersecurity Ventures research, only a quarter (25%) of global cybersecurity jobs were held by women in 2022. This number is expected to jump by only 5% by 2025 and only 10% by 2030 to reach 35%. This represents a significant gender gap in an industry that is growing at a rapid pace.


Failed Crypto Firm Genesis Approved to Repay Creditors Billions; Genesis defeated a challenge by parent Digital Currency Group; Judge also approved a related settlement with the New York AG
Jonathan Randles – Bloomberg
Bankrupt crypto lender Genesis Global Capital won court approval of its plan to distribute billions of dollars in digital assets and cash to creditors, defeating a legal challenge brought by its corporate parent Digital Currency Group. Judge Sean Lane said late Friday he’d confirm Genesis’ Chapter 11 repayment plan which includes a unique structure for returning Bitcoin and other tokens to creditors. The decision clears Genesis’s path to return customer assets that have been frozen on the platform since the firm paused withdrawals in November 2022 following the collapse of other major crypto firms.

Number of new Bitcoin wallets drops to lowest level since 2018
Zack Abrams – The Block
The seven-day moving average number of new addresses on the Bitcoin network, which approached its all-time high just six months ago, has fallen to its lowest level since 2018. Six months ago, excitement around spot Bitcoin ETFs, developments in the Bitcoin ecosystem such as Ordinals, and the upcoming halving drove the average weekly number of new Bitcoin addresses to approach its highest levels since its all-time high value in December 2017.

Blackrock Bitcoin ETF Attracts 414 Institutional Holders – Analyst Says IBIT ‘Blows Away Record’; Blackrock Bitcoin ETF Attracts 414 Institutional Holders – Analyst Says IBIT ‘Blows Away Record’
Blackrock’s spot bitcoin exchange-traded fund (ETF), the Ishares Bitcoin Trust (IBIT), has amassed 414 insitutional holders in less than three months, according to filings with the U.S. Securities and Exchange Commission (SEC). A senior Bloomberg analyst described this achievement as “mind-boggling” and “highly rare” for new ETFs. Other recently launched ETFs have significantly fewer institutional holders. According to 13F filings with the U.S. Securities and Exchange Commission (SEC) for the first quarter, 414 institutions have declared holdings in Blackrock’s spot bitcoin exchange-traded fund (ETF), the Ishares Bit oin Trust (IBIT). The SEC requires institutional investment managers overseeing over $100 million in assets to file Form 13F to disclose their securities holdings.


We are a step closer to taxing the super-rich; What once seemed like an impossibility is now being considered by G20 finance ministers
Martin Sandbu – Financial Times
The global corporate tax reform that came into effect this year was something of a miracle. Less than a decade ago, few would have thought it realistic that most countries in the world would ever agree to close loopholes for corporate taxation, institute a global minimum rate, and decide how to apportion the new tax take – set to be more than $200bn a year – among themselves.

Basel III endgame: why moving fast might prove better for banks; Republicans are pushing for reproposal, but a rapid finalisation may prove less far-reaching
Janice Kirkel – Risk.net
US Republicans have been clear about what they want regulators to do with controversial proposed prudential rules: go back to the drawing board. But perhaps they need to be careful what they wish for. In practice, a fast track to finalising the US implementation of the Basel III banking standards may require the three federal regulators to scale back their ambitions, which would be more in line with what Republicans and bank lobbyists have been seeking.

Crypto Industry Rallies Behind House Bill as It Heads Toward Final Vote; The so-called FIT21 legislation to establish a U.S. regulatory regime for digital assets is set for a floor vote next week, and the sector is telling House leaders the effort is “crucial.”
Jesse Hamilton – CoinDesk
The U.S. House of Representatives is on the verge of a vote that will represent the closest the cryptocurrency industry has ever been toward finally winning regulation in the U.S., and the sector’s associations and top businesses are encouraging House leaders to support the effort.

Ron DeSantis signs bill scrubbing ‘climate change’ from Florida state laws; State, which just had its hottest year since 1895, will ban offshore wind power, boost natural gas and reduce gas pipeline rules
Guardian staff and agencies
Climate change will be a lesser priority in Florida and largely disappear from state statutes under legislation signed on Wednesday by the state’s governor, Ron DeSantis, in a move which experts say ignores the reality of Florida’s climate threats. The legislation, which comes after Florida had its hottest year on record since 1895, also bans power-generating wind turbines offshore or near the state’s lengthy coastline.

Behind New Caledonia’s Riots, a Fight Over Vast Reserves of Nickel; France has a plan to lift restrictions on exports of the archipelago’s nickel to supply clean-energy manufacturing, drawing condemnation from indigenous leaders
Matthew Dalton and Sam Schechner – The Wall Street Journal
Before riots swept New Caledonia last week, President Emmanuel Macron aimed to put the remote territory-and its massive reserves of nickel-at the center of France’s push to secure raw materials for the clean-energy transition and compete against China in manufacturing electric vehicles. Those plans are colliding with a hard-line local political movement that seeks independence from France and is refusing to go along.

China retaliates against the US and EU with anti-dumping probe; Tit-for-tat investigation into thermoplastics follows a pattern established during the Trump presidency
Eleanor Olcott and Paola Tamma – Financial Times
China has signalled it will retaliate against trade barriers introduced by the US and the EU as it launched an anti-dumping probe into chemical imports. The Ministry of Commerce announced on Sunday that it is probing imports of polyoxymethylene copolymer, a thermoplastic widely used in the consumer electronics and automotive industries, from the EU, the US, Japan and Taiwan.


Post Office: Fujitsu sacked top boss at height of Horizon scandal
Ben King – BBC
Fujitsu, the company that built the flawed Horizon IT system, sacked a top boss at the height of the scandal. Rod Vawdrey, 67, was dismissed as Fujitsu’s global president in 2014 for personal conduct issues, former colleagues say. He returned to his native Australia, where he is now being sued for his involvement in a “train wreck” stock market float which made him millions.

UK City minister hits out at watchdog’s fraud refund plan; Bim Afolami says PSR’s proposal has ‘significant problems’ in latest sign of tension between Treasury and regulators
George Parker and Akila Quinio – Financial Times
The UK’s City minister has criticised plans to force banks and payment companies to reimburse fraud victims up to £415,000 from October, in the latest sign of growing tensions between the Treasury and regulators. Bim Afolami told the Financial Times there were “significant problems” with the proposed rules, following industry warnings that the new regime could force some smaller payment system providers out of business and encourage crime.

Board Approves 2023 Annual Financial Report, Adds New Members to Advisory Committees and Hears Latest on FINRA’s Advanced Analytics Strategic Initiative
FINRA’s Board of Governors met on May 8-9 for the second time in 2024. The Board approved FINRA’s 2023 Annual Financial Report, appointed new members to Advisory Committees, was briefed on FINRA’s Advanced Analytics Strategic Initiative, received operational updates and continued discussions around FINRA’s long-term financial planning. FINRA’s 2023 Annual Financial Report will be publicly available in the coming weeks. Each year, FINRA publishes an Annual Financial Report in accordance with U.S. generally accepted accounting principles that describes how FINRA manages its finances to support its mission of protecting investors and promoting market integrity. The report is one aspect of FINRA’s financial transparency, which includes the posting of FINRA’s Financial Guiding Principles, the release of FINRA’s Annual Budget Summary and the publication of the annual Report on the Use of FINRA’s Fine Monies, which was approved in March.

Even a Fraud Conviction Won’t Keep Nikola’s Founder Away From the Company; Trevor Milton is fighting the hydrogen-truck maker, his conviction and his neighbors
Ben Foldy – The Wall Street Journal
Embattled hydrogen-truck maker Nikola wants to put its convicted founder in the rearview mirror. Trevor Milton has had other plans. Milton, whose over-the-top promotion helped make Nikola’s shares worth billions at one point, still owns a stake in the company. He has publicly criticized and tried to replace the company’s board. He is in a legal fight with Nikola over a $165 million arbitration award. Milton is also in a spat with his neighbors and his local government over his use of a helicopter to fly to one of his mansions.

SEC Announces Departure of Policy Director Heather Slavkin Corzo and Appointment of Corey Klemmer to the Role
The Securities and Exchange Commission today announced that Policy Director Heather Slavkin Corzo will leave the agency. Corey Klemmer, most recently the Corporation Finance Counsel to Chair Gary Gensler, has been appointed Policy Director. “Heather has been one of my most trusted advisers over the last three years,” said Chair Gensler. “She has provided sound counsel and managed a policy agenda that, together, have bolstered protections for the investing public and enhanced avenues for capital formation by issuers – with achievements ranging from money market fund reform to shortening the settlement cycle to enhancing corporate disclosure about material cyber events. I wish her the best of luck.”

Tina Diamantopoulos Named Regional Director of Chicago Office
The Securities and Exchange Commission today announced that Tina Diamantopoulos has been named Director of the Chicago Regional Office, the Commission’s second-largest regional office. Ms. Diamantopoulos is a 30-year veteran of the SEC and has held leadership roles in both the Division of Enforcement and the Division of Examinations. Since April 2022, she has served as the Associate Director for the regional broker-dealer examination program supervising teams that examine broker-dealers, exchanges, transfer agents, municipal advisors, funding portals and security-based swap dealers.

SEC Adopts Rule Amendments to Regulation S-P to Enhance Protection of Customer Information
The Securities and Exchange Commission today announced the adoption of amendments to Regulation S-P to modernize and enhance the rules that govern the treatment of consumers’ nonpublic personal information by certain financial institutions. The amendments update the rules’ requirements for broker-dealers (including funding portals), investment companies, registered investment advisers, and transfer agents (collectively, “covered institutions”) to address the expanded use of technology and corresponding risks that have emerged since the Commission originally adopted Regulation S-P in 2000.

Statement on the Application of IFRS 19, Subsidiaries without Public Accountability: Disclosures, in Filings with the SEC [1]
Erik Gerding, Director, Division of Corporation Finance
Paul Munter, Chief Accountant – SEC
In May 2024, the International Accounting Standards Board (“IASB”) issued International Financial Reporting Standard (“IFRS”) 19, Subsidiaries without Public Accountability: Disclosures (“IFRS 19”), which permits certain subsidiaries of reporting companies to provide reduced disclosures when applying recognition, measurement, and presentation requirements of IFRS Accounting Standards.[2] IFRS 19 also specifies that eligible subsidiaries that elect to apply the standard must provide additional material disclosures when it determines that information is necessary to enable financial statement users to understand the impact of transactions, events, and conditions on the subsidiary’s financial position and financial performance.[3] Although the scope of IFRS 19 is limited to entities that do not have public accountability[4] at the end of their financial statement reporting period, there may be situations when financial statements that apply IFRS 19 are included in filings with the Securities and Exchange Commission (the “SEC” or the “Commission”). In these situations, we believe that the requirements of IFRS 19 are likely to necessitate additional disclosures in financial statements filed with the SEC because such financial statements are intended for use by investors in our public capital markets for making investment and voting decisions.

Statement on the Amendments to Regulation S-P: Privacy of Consumer Financial Information and Safeguarding Customer Information
Commissioner Mark T. Uyeda – SEC
Today, the Commission adopted amendments to Regulation S-P, which were proposed last year.[1] Regulation S-P was initially adopted in 2000 pursuant to the Gramm-Leach-Bliley Act, or the GLBA.[2] Congress subsequently amended the applicable privacy provisions of the GLBA in 2015.[3https://jlne.ws/3K3YSYu]

Please Mr. Postman – Statement on Regulation S-P
Hester Peirce – SEC
I write in support of today’s amendments to Regulation S-P, albeit with some reservations. Protecting customers’ information and notifying them when it is compromised are important-even more important than when the Commission adopted the original version of Regulation S-P in 2000. All of us have given our personal information to a business with a tinge of fear that our information is at risk because even companies that work hard to protect this information are under constant attack by cybercriminals.[1] And many of us have received a letter notifying us of a breach involving our information.[2] Today’s Regulation S-P modernization will help covered institutions appropriately prioritize safeguarding customer information. Customers will be notified promptly when their information has been compromised so they can take steps to protect themselves, like changing passwords or keeping a closer eye on credit scores. My reservations stem from the breadth of the rule and the likelihood that it will spawn more consumer notices than are helpful.

Remarks Before the Conference on Emerging Trends in Asset Management
Natasha Vij Greiner – SEC
Good morning. I am Natasha Vij Greiner, Director of the SEC’s Division of Investment Management. It is my honor to welcome all of you to the second annual Conference on Emerging Trends in Asset Management hosted by the SEC’s Division of Investment Management. Whether you are attending in-person or watching us on-line through the live webcast-welcome. We appreciate your interest in the work that we do, and in this Conference’s consideration of emerging trends in asset management.

Protecting Investors with More Timely Disclosure of Cyber Breaches
Commissioner Jaime Lizarraga – SEC
I am pleased to support the adoption of reforms to Regulation S-P, an existing Commission rule requiring firms to adopt policies and procedures that include safeguards to protect customer records and information. These reforms will strengthen privacy protections for hundreds of millions of retail investors in our country. More than two decades ago, Congress enacted legislation, the Gramm-Leach-Bliley Act, that made it possible for financial firms to offer a range of financial services under one roof. One of the main public interest dimensions of the congressional debate centered on the protection of customer privacy, a matter of direct relevance to millions of retail investors.

“Jack Bogle, Haystacks, and Putting the Interest of the Clients First”, Prepared Remarks Before the 2024 Conference on Emerging Trends in Asset Management
Chair Gary Gensler – SEC
Thank you, Natasha. As is customary, I’d like to note that my views are my own as Chair of the Securities and Exchange Commission, and I am not speaking on behalf of my fellow Commissioners or the staff. Jack Bogle, the father of index funds, once said: “Don’t look for the needle in the haystack. Just buy the haystack.” Of course, he was talking about collective investment vehicles-when well-regulated, one of the great financial innovations. They provide everyday investors with diversification and lower costs than investing in individual stocks or bonds.

ASIC disqualifies QLD director for maximum five years
ASIC has disqualified Laurence Christopher Pereira of Mount Tamborine, Queensland, from managing corporations for the maximum period of five years due a serious level of misconduct that demonstrated behaviours well below the standard expected of Australian company directors.

ASIC report: Australians need better hardship support from their lenders
Some home loan lenders have made accessing financial assistance so difficult that more than one in three (35%) Australians dropped out of the application process at least once, according to a new ASIC report.

FMA files civil proceeding against individual for making alleged false or misleading representations and other breaches
FMA – New Zealand
The Financial Markets Authority (FMA) – Te Mana Tātai Hokohoko – has filed civil proceedings against Rangi Wyatt Stephen Savage for making an unregulated public offer for the sale of shares in The Powder Shed Tokoroa Limited (Powder Shed). Mr Savage was the sole director of Powder Shed.

Speaker: Sarah Pritchard, Executive Director, Markets and Executive
I’m going to let you into a secret. A fact not known widely about me is my hobby of outdoor cold water swimming.n While getting up early sometimes to delve into icy waters is not everyone’s idea of fun, for me there is a certain exhilaration about those first steps into the water and braving the elements. This is not a risk free activity – quite the opposite in winter without a wetsuit.

IOSCO welcomes IESBA’s consultation on the Proposed International Ethics Standards for Sustainability
IOSCO today congratulated the International Ethics Standards Board for Accountants (IESBA) on achieving an important milestone by publishing for consultation their Proposed International Ethics Standards for Sustainability Assurance (IESSA) and Other Revisions to the Code Relating to Sustainability Assurance and Reporting (the Paper).

MAS Issues Prohibition Order Against Mr Muhammad Hafiz Bin Ismail for Dishonest Conduct
Monetary Authority of Singapore
The Monetary Authority of Singapore (MAS) has issued a 5-year prohibition order (PO) against Mr Muhammad Hafiz Bin Ismail, a former representative of DBS Bank Limited (DBS). The PO was issued following Mr Hafiz’s conviction for intentionally obstructing the course of justice by the State Courts, and separate contraventions of the Financial Advisers Act (FAA) and the Securities and Futures Act (SFA).

Investing and Trading

‘I had no choice but to get a 35-year mortgage’
Lora Jones – BBC
Young homebuyers are facing huge challenges when it comes to getting on – and staying on – the housing ladder. Nicola Webb, a 34-year-old nurse, felt she had little choice but to opt for an ultra-long mortgage when purchasing her first home last year. It’s set to end when she is 68, but she says stretching out the repayments is “the only way I can just about afford my mortgage as a single homeowner”.

Renting Forever and Trying to Create a Strong Financial Future; Either by choice or because they are priced out of the market, many people plan to never stop renting. Building wealth without home equity requires a different mind-set.
Paulette Perhach – The New York Times
Moving back and forth from Tennessee to Alaska, Michael Rogers and his wife Christy have twice been stuck simultaneously paying a mortgage and rent. Once, in 2006, the situation dragged on for eight months, finally ending when they sold their house in Tennessee for $20,000 below what they’d paid for it.

Want to Buy SpaceX Stock? You Have to Know Someone; Shares in Elon Musk’s rocket and satellite company are a hot ticket for investors, but SpaceX tightly controls access
Micah Maidenberg – The Wall Street Journal
SpaceX has become one of the investing world’s most exclusive clubs. Invites circulate via group chats, word of mouth and emails marked confidential. Investment vehicles providing access to Elon Musk’s closely held rocket and satellite company have generated hefty demand, and fees for those arranging them. For years, the company’s value has only gone in one direction-up.

When to Treat Your 401(k) as a Bank. And When to Keep It Locked Up. Higher interest rates make retirement-plan loans more attractive, but there are risks
Anne Tergesen and Veronica Dagher – The Wall Street Journal
The textbook advice when it comes to borrowing money from your 401(k) is don’t do it. It’s time to rethink that knee-jerk response. The reason is twofold. Higher interest rates have made the comparative math on these loans more favorable as home equity, personal loans and credit cards have become more expensive. In addition, the 9.5% interest rate many 401(k) borrowers are now required to pay themselves reduces the risk that borrowers will miss out on market returns while repaying their loans.

A Stock Trader’s Guide to Navigating Fresh US Tariffs on China; US unleashed tariffs on Chinese EVs, solar cells, chips; Investors mindful of potential for Europe to do the same
Sangmi Cha, Kit Rees, and Esha Dey – Bloomberg
From semiconductors to solar panels, stocks in some of the world’s fastest-growing industries risk falling prey to another round of trade tensions between the US and China. President Joe Biden’s new tariffs on about $18 billion of annual imports from China target batteries, chips, solar cells, and critical minerals. That’s in addition to previous increases on steel, aluminum and electric vehicles. And in an election year, the move is unlikely to be the last, as Biden and his Republican rival Donald Trump jostle to show voters who can be tougher on China.

GameStop to sell up to 45mn new shares after latest ‘meme stock’ rally; Video games store operator announces preliminary results showing expectations of further drop in net sales
Alexandra White and George Steer – Financial Times
GameStop has announced plans to sell up to 45mn new shares, following a week in which its stock soared after the re-emergence of a popular day trader synonymous with “meme stock” investing. The video game retailer announced the plans in a filing on Friday with the US securities regulator. It accompanied preliminary results showing GameStop expected net sales in its first quarter to decline from a year ago.

Europe’s Aging Population Is a Money Magnet for Some Investors; Crematoriums and morticians being bought up by larger firms; Sector growth linked to rising deaths, shifting cultural norms
Verena Sepp and Eyk Henning – Bloomberg

Flash in the Pan Meme Moment Takes Some Stock Traders on Wild Ride; Storied day-trading favorites failed to match pandemic run-ups; Bill Gross sold GameStop, AMC straddles during the frenzy
Bailey Lipschultz, Carmen Reinicke, and David Marino – Bloomberg

Gold Rises as the Financial Backdrop Mellows; Financial conditions look set to become friendlier for the yellow metal.
John Stepek – Bloomberg

Meme-Stock Mania Crashes Into Reality of Depleted Covid Savings; GameStop’s brief rally, fueled by a social media post, offered a stark contrast to data showing that households budgets are under stress.
Charlie Wells – Bloomberg

Environmental, Social and Corporate Governance

Weather Like the Deadly Houston Windstorm Is Being Fueled in Part by Climate Change; Scientists have detected an increase since the 1980s in what are known as straight-line winds, and climate change is playing a role.
Brian K Sullivan and Eric Roston – Bloomberg
The winds that roared out of a supercell thunderstorm Thursday night leaving a deadly trail across Houston are on the rise in a warming climate, though researchers are still teasing out the exact relationship between a rapidly heating planet and relatively small-scale weather patterns. Power remains out for almost 700,000 customers in the Houston area after an intense storm swept through the area with winds in excess of 75 mph (120 kmh), downing trees, blowing out windows and leaving at least four dead. Economic losses and damages could be between $5 billion and $7 billion, according to an initial AccuWeather estimate.

Giant Hail Is the Weather Threat Keeping Insurers Up at Night; Powerful hail storms are wreaking more destruction in the US and Europe, at a cost of billions of dollars a year.
Leslie Kaufman – Bloomberg
On May 9, hailstones the size of baseballs pummeled San Marcos and Johnson City, Texas, taking down power lines and cracking car windscreens. Only weeks before, hail pounded a solar farm in the state, damaging many panels. And in mid-March, grapefruit-sized hail pelted down from the skies over Kansas, Oklahoma and Missouri, leading to damages on the ground exceeding $4 billion.

Climate change impacts millions in India. But as the country votes, some politicians skirt the issue
Sibi Arasu – Associated Press
Almost 970 million Indians are voting in general elections amid sweltering heat and unpredictable weather extremes exacerbated by human-caused climate change, leading to loss of livelihood, forced migration and increasingly difficult living conditions for millions across the country. Voters are looking for politicians who promise relief, stability and resilience to the wide-ranging and damaging effects of a warming climate. In their election manifestos, India’s top political parties, including the governing Bharatiya Janata Party and the main opposition, the Congress party, have made multiple promises to act on climate damage and reduce emissions of planet-heating gases.

Is Biodegradable Plastic Really a Thing? Technically, it exists. But here’s what to think about when shopping.
Hiroko Tabuchi – The New York Times

The Race to Decarbonize Heavy Industry Heats Up; Backed by federal funding, MIT spinoff Electrified Thermal Solutions says its electrically conductive bricks can replace fossil fuels.
Phil McKenna – Inside Climate News

China extends green tech lead to carbon capture and sequestration; Beijing holds three times as many patents in the area than the U.S.

Why Washington’s new tariffs on Chinese clean tech goods matter; Joe Biden’s move looks to court blue-collar votes in electoral swing states – but will be felt far beyond the US
Aime Williams – Financial Times

South Africa’s SARB Says Carbon Taxes May Cut Exports by 10%; Growth could be 9.3% less in 2050 under severe scenario; Hundreds of thousands of S. African jobs at risk: central bank
Ntando Thukwana – Bloomberg

China and India Should Kick Their Coal Habit; The Asian giants are almost single-handedly keeping the world’s dirtiest fuel alive. They can afford to scale back plans for new plants.
The Editorial Board – Bloomberg

Mexico Declares State of Alert for Power Grid Amid Heat Wave; Mexico’s power grid has been stressed amid a heat wave; Grid swung between states of alert and emergency last week
Jose Orozco – Bloomberg

Energy Mogul Makes 100-Year Bet on Argentina’s Mineral Wealth; Jose Luis Manzano says metals are key to energy transition; Integra Capital founder taps potash for global food security
Jonathan Gilbert and Daniel Cancel – Bloomberg


Citi Hit With Racial Bias Suit From a Conservative Law Firm; Complaint claims lender’s ATM fee policy violates federal law; Citi says policy intended to alleviate ‘barriers to banking’
Simone Foxman – Bloomberg
Citigroup Inc. was accused in a lawsuit of racial discrimination for its policy of waiving ATM fees for customers of minority-owned banks. The plaintiffs, who don’t bank with Citigroup, claim they were charged out-of-network fees for transactions at the bank’s ATMs in Florida, while customers from minority-owned financial institutions weren’t, according to the federal lawsuit filed Friday in Fort Lauderdale. They say the bank’s policy violates federal and California law.

Bain Capital aims to double its investment in Japan; Private equity giant also sees opportunities in India, South Korea
Mitsuru Obe – Nikkei
Bain Capital is looking to double its investment in Japan in the next five years with the country emerging from decades of stagnation as one of the hottest destinations for global investors. “In the last five to 10 years, we’ve invested in excess of $5 billion” in Japan, David Gross, co-managing partner of the U.S. private equity company, told Nikkei Asia in an interview. “We certainly think that could double over the next five years.”

Vanguard ‘nickel-and-dimes Grandma’ after 49 years without junk fees
Allan Sloan – Yahoo Finance
In the fee-laden world of money management, the Vanguard Group has long enjoyed a reputation of shooting straight. When Jack Bogle founded Vanguard almost 50 years ago, the idea was to create a company owned by its investors – aligning the company’s and customers’ incentives. That unique model, unlike shareholder-owned outfits like Schwab and Fidelity, pushed Vanguard to constantly look for ways to reduce fees, leading to minimal fee index funds, low fees for actively managed funds, and a general lack of chintzy or hidden fees.

Vanguard defends dominance of US equities in EU-domiciled funds; Response follows warnings of ‘unintended consequences’ of passive funds shunning EU corporations
Dominic Lawson – Financial Times
Vanguard has defended the dominance of US equities in European investors’ passive fund portfolios in the face of growing criticisms from EU asset managers and policymakers that listed companies in the bloc are missing out on investment. Sandro Pierri, president of the European Fund and Asset Management Association, said last month the rise of passive investing has the “unintended consequence” of benefiting US corporates over those in the EU.

A $10 Billion Real-Estate Fund Is Bleeding Cash and Running Out of Options; The Starwood Real Estate Income Trust, known as Sreit, has three choices-none of them appealing
Peter Grant – The Wall Street Journal
A giant commercial real-estate fund is scrambling to escape a looming cash crunch caused by the long line of investors who want their money back. The $10 billion fund from Starwood Capital Group has been trying to preserve its available cash and credit by limiting investor redemptions. In the first quarter, the fund was hit with $1.3 billion in withdrawal requests but satisfied less than $500 million of them, according to regulatory filings.

Work & Management

Musk Effect Drives Spread of Supersize CEO Pay Packages; More executives make $50 million and up-with potential for growth over time
Theo Francis – The Wall Street Journal
Elon Musk didn’t just upend the global auto business and space missions. The billionaire is also reshaping the landscape of executive pay. Musk’s multibillion-dollar pay package from 2018 has set the tone for other high-end pay deals, despite being thrown out by a Delaware court earlier this year. More executives have gotten outsize pay packages, and those packages have been bigger, in the years since Musk’s came to light. They also have the potential to keep growing for years-generating value for CEOs along the way.

Working From Home and Spending Billions Shopping Online; Without the boss nearby, who can resist placing that Amazon order?
Rachel Feintzeig – The Wall Street Journal
Click. Scroll. Add to cart. Now toggle back to that Zoom meeting. On our remote days, it turns out, we shop while we work. Researchers say it’s driving billions in online sales. There we all are, browsing everything from toothpaste to concert tickets while nodding along on a video call, keying in credit-card info in between dashing off emails to the boss. Shopping away our entire workday is obviously a bad move. But indulging in a little isn’t going to tank productivity. We pause and procrastinate at the office, too, in ways that are acceptable there. At home, we gather around clothing reviews like we’re hanging out at the office water cooler, and tick errands off our list via Target.com.

AI is already changing management – companies must decide how; Human intelligence shaped organisations but it is no longer the only form at work
Ethan Mollick – Financial Times
Most companies do not have an artificial intelligence strategy, yet they are already riddled with the technology. A survey published this month by LinkedIn and Microsoft suggested that three-quarters of white-collar workers have used AI for work, and four-fifths of them have done so from their own accounts and devices. They are not seeking the permission of their employers; in fact, they are hiding it from them, because they are afraid of the consequences.

New data shows progress on diversifying leadership of US companies is one step forward, two steps back
Sophie Spiegelberger and Patrick Temple-West – Financial Times
There are more women on US company boards than ever before but the number of female executives has fallen for the first time in decades, according to data that shows the uneven progress of efforts to diversify America’s corporate leadership. The percentage of female board directors at Russell 3000 index companies continues to rise, to 30 per cent this year from 29.4 per cent at the end of 2023 and 28.5 per cent in 2022, according to ISS Corporate, a data provider. However, in executive positions, women lost seats in 2023 for the first time since at least 2005, according to an S&P analysis of companies in its global total market index. In senior management roles under the executive level, the growth of women’s representation slowed in 2023 to the lowest rate in more than a decade, S&P has said.

Wellness Exchange

Singapore Monitoring New Covid Wave as Infections Rise
Abhishek Vishnoi – Bloomberg
Singapore’s government is closely tracking a new wave of Covid-19 infections in the island-nation after the estimated count of weekly cases nearly doubled in the week ended May 11. The government “is closely tracking the trajectory of this wave,” the Ministry of Health said in a statement on Saturday. It said the estimated number of Covid-19 cases nearly doubled to 25,900 in the week of May 5 to 11, compared with 13,700 in the prior period.

Like to bike? Your knees will thank you and you may live longer, too
Allison Aubrey – NPR
We are in the middle of National Bike Month, and cycling enthusiasts love to talk up the benefits of their favorite activity. “It’s definitely my longevity drug,” says Brooks Boliek, 65, an avid cyclist of many decades, who used to commute to his office on a bicycle. A substantial body of evidence supports the health benefits of cycling, everything from strengthening the immune system to boosting the likelihood of living longer. Now, a new study finds people who are in the habit of riding a bike are significantly less likely to have osteoarthritis and experience pain in their knees by age 65, compared to people who don’t bike.


Tony O’Reilly, Ex-Heinz CEO and Irish Businessman, Dies at 88; International rugby star found success in array of industries; Prime minister hails ‘a giant of sport, business and media’
Shiyin Chen and Donal Griffin – Bloomberg
Anthony O’Reilly, the Dublin native who became chief executive officer of ketchup maker H.J. Heinz Co. and once one of Ireland’s richest men, has died. He was 88. “It is with great sadness that I have learned of the death of Tony O’Reilly,” Ireland’s Prime Minister Simon Harris said in a statement Saturday. O’Reilly “was a giant of sport, business and media and left permanent legacies in all three.”

Ireland’s push to shore up share of ECB staff triggers call for nationality quotas; Union hits at warning by bank’s chief economist that retirement wave risks diluting Ireland’s presence
Martin Arnold – Financial Times
The European Central Bank is facing union calls to introduce nationality quotas for recruitment after an Irish member of the bank’s executive board urged Dublin to preserve his country’s outsized presence among the bank’s staff. Union representatives wrote to the ECB board to raise concerns after chief economist Philip Lane warned a minister in Ireland’s government that the country risked its share of bank employees being diluted. He said few of his countrymen were applying to join the ECB and many – including Lane himself – would retire over the next decade.

Vanguard defends dominance of US equities in EU-domiciled funds; Response follows warnings of ‘unintended consequences’ of passive funds shunning EU corporations
Dominic Lawson – Financial Times
Vanguard has defended the dominance of US equities in European investors’ passive fund portfolios in the face of growing criticisms from EU asset managers and policymakers that listed companies in the bloc are missing out on investment. Sandro Pierri, president of the European Fund and Asset Management Association, said last month the rise of passive investing has the “unintended consequence” of benefiting US corporates over those in the EU.

Zimbabwe Asks Miners to Ramp Up Gold Output to Support ZiG Currency
Godfrey Marawanyika – Bloomberg
Zimbabwe has asked gold miners across the country to ramp up output to support the ZiG currency launched last month, according to Mines and Mining Development Minister Winston Chitando. “This new currency is anchored on gold production, we have to determine ways to increase production,” Chitando said Monday in a meeting with miners in the capital, Harare.

Hong Kong’s Shaky Crypto ETF Debuts Dent Global Hub Aspirations; The two-week old Bitcoin and Ether funds suffered outflows; They are meant to help catalyze a center for digital assets
Sidhartha Shukla – Bloomberg
The first Hong Kong exchange-traded funds investing directly in crypto have so far failed to spark the kind of excitement that greeted rival US products, a blow for the city’s push to foster a preeminent digital-asset hub. Total assets at the batch of six Bitcoin and Ether ETFs have dropped about $25 million from the $293 million amassed when they debuted two weeks ago, reflecting in part investor outflows, data compiled by Bloomberg show.

Florida’s 125% Surge in Property-Insurance Bills Sows Havoc; Mounting costs push assisted-living centers in state to brink; ‘We are headed into a train wreck,’ one operator says
Lauren Coleman-Lochner and Melina Chalkia – Bloomberg
For Filicia Porter, the insurance bills were the final straw. They’d been climbing steeply for her assisted-living business as Florida was battered with ever more-powerful storms, and eventually, the numbers stopped adding up. So in March, she finally decided to call it quits, shutting the facility near Palm Beach that she opened just two years ago. That came four months after she closed an older location in Port St. Lucie, opened in 2017. Together, they left a dozen residents scrambling to find another place to live.


Cassette Tapes Are Getting a Boost From an Unexpected Source; And there are new retro-styled portable players to listen right along.
Matthew Kronsberg – Bloomberg
When Breakaway Records opened almost 16 years ago in Austin, the vinyl revival had barely begun. Back then, to stock shelves, the store had to find and buy up old vintage record collections, says owner Joshua LaRue. New vinyl albums soon became an important part of the business. Not long after, analog fans began clamoring for another old format: cassette tapes. Although the resurgence of tapes didn’t totally surprise LaRue, the people seeking them out did. “There are some older folks who buy cassettes here,” he says, “but I’d say the majority is younger people.” For Generation Z, it’s partly a bit of secondhand nostalgia. But also, because it has lower reproduction costs and DIY cachet, emerging artists have embraced the format for smaller releases.

Flood of Fake Science Forces Multiple Journal Closures; Wiley to shutter 19 more journals, some tainted by fraud
Nidhi Subbaraman – The Wall Street Journal
Fake studies have flooded the publishers of top scientific journals, leading to thousands of retractions and millions of dollars in lost revenue. The biggest hit has come to Wiley, a 217-year-old publisher based in Hoboken, N.J., which Tuesday will announce that it is closing 19 journals, some of which were infected by large-scale research fraud. In the past two years, Wiley has retracted more than 11,300 papers that appeared compromised, according to a spokesperson, and closed four journals. It isn’t alone: At least two other publishers have retracted hundreds of suspect papers each. Several others have pulled smaller clusters of bad papers.

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