The John Lothian Daily Update is a podcast turning the daily JLN hits and takes comments, our original content and the stories and quips in the top box of First Read into a daily podcast.
Hits & Takes
Here is the LINK for the DTCC press release about the proposal to shorten the U.S. settlement cycle to T+1 within two years.
Former CFTC Chairman J Christopher Giancarlo has an op-ed in the Financial Times titled “Let the market determine bitcoin’s value; Well-regulated trading is the best way to sort through conflicting views of the currency’s worth.” Giancarlo is a big proponent of a digital dollar.
The New York Times reports that California has passed the 50,000-death mark for the coronavirus, the most of any state, and that a new coronavirus variant is spreading in New York, according to researchers.
However, Bloomberg is reporting that “Two-Thirds of New York City’s Arts and Culture Jobs Are Gone,” which if true is very bad for when we can return to public entertainment.
In fashion news, the New York Time has a story titled “This Is the Coat to Wear to Davos.” The topcoat is made of Norwegian wool and is as warm as the big puffy coats. They are reportedly the favorite of financiers, news anchors and the movie crowd. My only question is “How Much?” and do they come in tall, or the other way around.
The Australian Securities & Investments Commission, or ASIC, has a press release titled “ASIC sues NAB for unconscionable conduct and misrepresentations over account fees.” I know some people who feel this way about other fees charged in the industry, especially for data.
Variety is reporting that Pulitzer finalists “Tom Wright and Bradley Hope have teamed for Project Brazen, a multi-platform journalism studio that will uncover global true stories from the world of entertainment, business, crime and international politics via podcasts, books, documentaries, television series and films.”
Xavier Rolet (Non Executive Chairman), Matthew Elliott (Senior Political Adviser) and Dr Clive Black (Head of Research) have a post on Shore Capital Markets website titled “Keeping the City healthy requires a global perspective and a strategically engaged British Government.”
Scott Knudsen, the CEO of Cove Markets, which has a platform to help you get the best crypto prices, talked his position a bit but had a great point saying on a tweet, “It’s interesting that #Coinbase makes 96% of its revenue from high fees while often executing trades at inferior prices. Meanwhile most people can trade stocks for free, are guaranteed the best price in market, and often getting price improvement inside the quote. Let’s fix this.”
The Sun is reporting that Kenneth Branagh is unrecognizable as Boris Johnson for new coronavirus drama “This Sceptred Isle.” You have to see it to believe it.
Owl Labs has published a piece on ’10 Icebreakers for a remote meeting.’ I have the first meeting of the Pathway to Adventure Council (Boy Scouts of America) Development Task Force today and need to break some ice.
We had no new donations to the JLN MarketsWiki Education GoFundMe campaign yesterday. Support our efforts to preserve industry history by giving to our GoFundMe campaign.
Today we have an Open Outcry Traders History Project video of Mike Cavanaugh, a former CBOT trader who made the transition to electronic trading and brokering and is doing very cool things today in fintech.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
Jim Bell, former chief financial officer of GameStop, is resigning from his position over a “disagreement over strategy,” Bloomberg reports. From the sound of it, he was pressured to leave. Bell is an ex-Navy officer who has worked in executive roles for various companies over the years, including Wok Holdings (owners of the PF Changs restaurant chain), Harry & David Holdings Inc., and Piper Jaffray Cos. Apparently Ryan Cohen – GameStop board member, former Chewy.com CEO, and “activist investor” (whatever that means) – has been pushing for change in the company. GameStop, which has been one of the biggest retailers of hard-copy video games in the video game industry for years, has struggled to adapt to the industry’s increasingly digital nature as gaming platforms have emphasized digitally-downloaded games over games read from physical media (like CDs). Most of GameStop’s revenue tends to come not only from selling video games and consoles, but selling used games and DVDs, as well as preorders for physical media, which often come with extra bells and whistles like exclusive in-game content or free swag. From the looks of it, Cohen has been pushing for the company to transition from a brick-and-mortar business to more of an e-commerce business. It would be a smart move, though I must admit, my inner child saddens at the thought of GameStop’s retail stores, in which I used to spend hours during my youth, disappearing forever. At least it ain’t all bad for Bell, though – he’s reportedly leaving with a $30 million severance package.~MR
The January Cannabis Market Insights published by Canadian-based Nasdaq analysts highlights a few trends we’ve also seen recently. The subscriber-based report notes that in the 12 weeks between November 5, 2020 and February 6, 2021, cannabis equities as a group outpaced broader equity markets in Canada and the U.S. but also had the highest volatility. The report said the Nasdaq Yewno Equity Cannabis Index showed a 70 percent return over the three-month period, with all but one of the index’s 28 underlying securities ending higher. Nine stocks included in the index were cited in the report as outperformers, up by at least 100 percent, including Tilray, Aphria Inc. and Ligand Pharmaceuticals.~SC
The cryptocurrency trading platform Coinbase’s public filing dropped this morning on the SEC’s website. You can peruse it here. In pre-filing OTC trading of shares offered on Nasdaq Private Market the company reached a market capitalization of $100 billion. Coinbase says it has 2.8 million monthly transacting users. A date for the launch of its shares on Nasdaq has not been provided.~Thom Thompson
Mike Cavanaugh – Open Outcry Traders History Project
Mike Cavanaugh found his way to the trading industry despite his degree in political science because he had a brother-in-law in the wheat pit at the CBOT. He did a summer internship working for “one of the more prolific wheat traders” and soon fell in love with the place.
Pfizer-BioNTech Shot Could Help End Pandemic, Israel Study Shows
Naomi Kresge and Jason Gale – Bloomberg
Shot cleared hurdles for preventing spread, symptoms, deaths; Effectiveness held up under scrutiny in real-world conditions
Pfizer Inc. and BioNTech SE’s Covid-19 vaccine was overwhelmingly effective against the virus in a study that followed nearly 1.2 million people in Israel, results that public-health experts said show that immunizations could end the pandemic.
*****A light at the end of the tunnel that is not a train coming at us for the first time in a while.~JJL
SPAC and ESG Fads Are on Collision Course With Billions at Stake
Swetha Gopinath – Bloomberg
SPAC IPOs have raised nearly $140 billion over the past year; Bernstein strategists question if SPACs are good fit for ESG
Two of the hottest equity market trends are headed for a clash as some ESG investors are having second thoughts about blank-check firms that have flooded the market. Early signs show that money managers wedded to environmental, social and governance themes are reluctant to buy into special-purpose acquisition companies before a target has been identified. That could potentially cut SPACs out of an investment class that’s on course to exceed $53 trillion by 2025, according to Bloomberg Intelligence.
*****How many different words can you spell with SPAC and ESG?~JJL
New Robin Hood Report: Pandemic Response Kept 1 Million New Yorkers Out of Poverty in 2020 But Failed to Close Racial Gap; Robin Hood and Columbia University to Unveil Report Today at No City Limits 2021
Robin Hood, in partnership with Columbia University, today release the third annual Poverty Tracker report on the state of poverty in New York City, detailing economic and social disparities that have been exacerbated by the pandemic, and highlighting policies that can keep people out of poverty while improving racial equity.
*****Robin Hood strives to improve financial inclusivity, but it isn’t really inclusive if people of color are not served as well.~MR
Let the market determine bitcoin’s value; Well-regulated trading is the best way to sort though conflicting views of the currency’s worth
J Christopher Giancarlo – FT
Bitcoin’s price is bouncing around $50,000 giving it an aggregate value near $1tn. The digital currency is increasingly part of the modern financial landscape. The venerable BNY Mellon is now handling bitcoin, Mastercard is integrating it into its payments systems and Tesla bought $1.5bn of bitcoin for its corporate treasury.
*****Chris Giancarlo is not letting go of his support for digital currencies and bitcoin. Maybe he is actually Satoshi Nakamoto.~JJL
Baffled Canadians Spread Reports Of ‘Hard’ Butter
Emma Bowman – NPR
There’s something off about the butter in Canada that’s left many flustered residents looking for answers. For weeks, Canadians have increasingly churned up debate on social media with anecdotes about “hard” butter that fails to spread as easily as it once did. “Something is up with our butter supply, and I’m going to get to the bottom of it,” cookbook author Julie Van Rosendaal tweeted earlier this month, renewing speculation. “Have you noticed it’s no longer soft at room temperature? Watery? Rubbery?”
*****What is the world coming to!?~MR
Wednesday’s Top Three
Our top story Wednesday was the Wall Street Journal’s Clearinghouse Urges Faster Trade Settlement Amid GameStop Scrutiny, about the Depository Trust & Clearing Corp’s new white paper advocating moving to T+1 settlement. Second was Bloomberg’s Isolated, Bored Employees Could Use a Little TLC These Days, with some tips for bosses on how to make employees “feel valued and connected.” Third was Why London should resist the Spac craze, from the Financial Times.