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
Broadridge has secured a deal to buy Itiviti, which used to be named Orc and was spun out of OM. Broadridge is a firm to keep your eye on as it buys and builds key parts of market infrastructure.
The Cboe received regulatory approval to launch periodic auctions for U.S. equities trading from the SEC. This is something the Cboe has talked about for several years, including having a professor who was a proponent of the periodic auctions give a presentation to the press at Boca one year, back when Bill Brodsky was still the chairman and CEO.
Bloomberg’s Joe Weisenthal and Tracy Alloway have recorded an interview with Virtu CEO Doug Cifu, who explains payment for order flow and the future of HFT. Worth a listen.
The big story in the market is an old one. It is about a hedge fund that ate like a bird and is pooping like an elephant.
The television show Saturday Night Live’s Pete Davidson explained NFTs in an Eminem parody on the show over the weekend.
There were no new donations to the JLN Marketswiki Education GoFundMe campaign over the weekend. Support our efforts to preserve industry history by giving to our GoFundMe campaign.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
Wolters Kluwer covered CFTC Commissioner Brian Quintenz‘s “dissent” published last week about cryptocurrency futures exchange ErisX‘s withdrawal of proposed futures contracts on football gambling. ErisX withdrew its proposal shortly before the CFTC was set to disapprove it. Brad Rosen’s piece, which recounts the commissioner’s position, was published Friday after we mailed our newsletter. It is now available here.~Thom Thompson
The Spread: Moonshot
This week on The Spread, bitcoin options hit records for bullishness, the OCC adds two industry veterans to its board of directors, and more.
How a Desert Wind Blew $10 Billion of Global Trade Off Course; The giant Ever Given container ship remains wedged in the Suez Canal. We spoke to captains and analyzed marine tracking data to look at what might have gone wrong.
K Oanh Ha, Javier Blas, Mirette Magdy, and Ann Koh – Bloomberg
The forecast for Tuesday, March 23, showed wind gusts of more than 40 miles per hour and sand storms sweeping through northern Egypt. Indeed, such weather is common in the Sinai desert at this time of year. The Suez Canal—one of the most critical, yet precarious waterways on the planet—remained open. Ships were starting to form the daily convoy as the gusts picked up. One of the world’s biggest container vessels, the Ever Given, joined it. The decision would reverberate globally within hours.
*****With a little help from the moon, there is some progress that has been made. If you really look at it, what we had here was a ship captain that was not very good at the game of Tetris.~JJL
Robinhood Trader May Face $800,000 Tax Bill
Shahar Ziv – Forbes
Over eight million people opened new brokerage accounts in the first three quarters of 2020. While the thrill of enormous stock gains may have provided a much needed distraction for some during the pandemic, unintended tax consequences are now manifesting for new investors. In one jaw-dropping case, a Robinhood newbie is facing a potential tax bill of $800,000 despite only making $45,000 in net trading profits; the individual also earned $60,000 at his day job. The example reinforces the importance of understanding complex trading rules and the tax implications of certain strategies. More broadly, it should serve as a loud warning for the new crop of do-it-yourself investors.
*****Here is a lesson on why it is important to read the rules of the game you are playing. This trader is probably not alone in this type of predicament.~JJL
Remote Work Is Here to Stay. Manhattan May Never Be the Same; New York City, long buoyed by the flow of commuters into its towering office buildings, faces a cataclysmic challenge, even when the pandemic ends.
Matthew Haag – NY Times
Spotify’s headquarters in the United States fills 16 floors of 4 World Trade Center, a towering office building in Lower Manhattan that was the first to rise on the site of the 2001 terror attacks. Its offices will probably never be full again: Spotify has told employees they can work anywhere, even in another state. A few floors down, MediaMath, an advertising tech company, is planning to abandon its space, a decision fueled by its new remote-work arrangements during the pandemic.
*****This is a real question for me: What will the downtown areas be like when people feel free to go back to work together? I think it will be different. Many firms will be downsizing their space. The WeWork approach will be more popular. And many people will continue to work at home, empowered by the technology and experience of having done it for a year during the pandemic.~JJL
Friday’s Top Three
The top-read story on Friday was a recap of by the FIA’s Will Acworth, Six things we learned from Boca V. The second most-read was the lengthy statement by CFTC Commissioner Brian Quintenz on the withdrawn ErisX NFL futures contracts Any Given Sunday in the Futures Market. And third was a press release about the commodity deal Marex Spectron Acquires Starsupply.