The Unemployed Trader Who Became a $700 Million Exile

Nov 10, 2021

First Read

$54,406/$300,000 (18.1%)


Hits & Takes
John Lothian & JLN Staff

Later this morning we will have the first video from our FIA Industry Leaders series from EXPO 2021 in Chicago last week. The first one is our interview with CFTC Commissioner Dawn Stump. Look for it on

Clive Furness, the CEO of Contango Markets Limited, had this to say about the CME and Google’s deal on LinkedIn:

The CME Group announcement of their partnership with Google, heralds, in my view, a complete change in the value proposition for exchanges. I believe that we are now witnessing the start of the new exchange world where data is of more value than the transactions themselves. Of course, the transition may take a while but I truly believe that what we witnessed last week was the birth of the new world and will spawn completely new types of products, transaction methodologies and participants. I, for one, am massively excited about the opportunities this heralds….

Eurex is a sponsor of a virtual conference, “Asia Risk Congress 2021,” which runs for five days from November 15 to 19. The conference focuses on risk and regulation, climate risk, non-financial risk, derivatives, quantitative finance, and investing and will discuss the latest on Libor transition, regulatory developments, non-financial risk, and derivatives. Professionals from buy-side firms, banks, regulators and corporates are eligible for a free delegate ticket to the conference. — Eurex

The latest FIA Data Tracker is out showing monthly data on customer funds held at U.S. futures commission merchants. — FIA

Montréal Exchange (MX) announced the upcoming launch of its 30-Year Government of Canada Bond Futures (LGB®) market-making program on November 29. MX has partnered with National Bank Financial and Desjardins Securities to provide liquidity in the 30-year point of the Canadian listed yield curve.

John Angelos of Cboe shared this on LinkedIn: Cboe Global Markets is hiring a Director, Credit Derivatives Sales based out of either Chicago or NYC. The ideal background is someone who comes from the credit derivative space and has a deep understanding of the Credit ecosystem, e.g. OTC (CDX, TRS) ETF (HYG, LQD), preferably from a buy-side or sell-side firm. If you or anyone you know is interested in applying, please reach out to Katie at

The Cboe is making progress on development of its trading floor. Here is their latest video showing the progress of the construction.

FairX posted a text exchange on LinkedIn to promote the fact that they traded over 10K contracts in a day. This was very creative marketing by FairX

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


The basic data was out previously, but the Tuesday FIA webinar on third-quarter global derivatives volume and open interest still held a few points of interest. Presenters Will Acworth, senior VP of FIA publications, data and research, and Lisa Cavallari, Russell Investments’ director of fixed income derivatives and commodities, pointed out several highlights of the period. We knew equity contacts, particularly in their new “micro” formulation, have been driving volume growth. Total volume for the third quarter reached 15.8 billion contracts, surpassing a record of 14.8 billion set in the first quarter. Separately, open interest reached a record 1.13 billion contracts at the end of Q3, fueled largely by an increase in trading in North America. Less well known was that the utilization of “global futures” has been growing over the past five years, Acworth said. The stabilization of interest rate futures and options volume around the one billion contract level over the last two quarters also was worth noting, but trading has moved from the once-popular 2-year sector toward the longer end of the yield curve.~SC

Cboe Options Institute will host a free 75-minute webinar on “New Developments in 24 x 5 Around-the-Clock Options Trading” on Wednesday, November 17, at 9 a.m. ET. It’s just in time for the debut of extended global trading hours for SPX and VIX options, which will be lengthened on November 21, subject to regulatory review. More information on the event is here.~SC

The World Federation of Exchanges just published a Focus special on COP26. Featured is Bolsa de Valores de Colombia (BVC), which is on course to make its operations net-zero by the end of 2021. In the video address, BVC outlines its plan to help Colombia transition to a more inclusive, low-carbon and digital economy. Watch here.~SC


Elon Musk Loses $50 Billion in Two Days in Record Wealth Plunge
Sophie Alexander – Bloomberg
Slide is biggest 2-day drop in history of Billionaires Index; Musk remains world’s richest person by $83 billion margin
Elon Musk has lost $50 billion so far this week after Tesla Inc. shares plunged for the second day in a row. It’s the biggest two-day decline in the history of the Bloomberg Billionaires Index, and the biggest one-day fall after Jeff Bezos’s $36 billion plunge following his divorce from MacKenzie Scott in 2019.

***** It was good while it lasted. I remember it like it was the day before yesterday. ~JJL


Pfizer, BioNTech Ask FDA to Expand Covid-19 Booster Use to All Adults; If the FDA grants the request, the companies’ booster shot would be cleared for people 18 years and older, in addition to certain high-risk adults already eligible
Jared S. Hopkins and Stephanie Armour – WSJ
Pfizer Inc. PFE 1.52% and partner BioNTech SE BNTX 3.86% asked U.S. health regulators to expand the authorization of their Covid-19 booster to people as young as 18 years old, as the government explores expanding access to extra doses.

*****This would be a huge step forward for the U.S.~JJL


Tuesday’s Top Three
Our top story Tuesday was the one with the most provocative title, Investment company staff required to get special approval to hire white men from The Telegraph via Yahoo Finance. Second was our lead story, EU Set to Ban Trading Practice Helping Power Meme-Stock Mania, from Bloomberg. Third was Euronext breaks LSE deal to move clearing functions to Italy, from The Financial Times.


MarketsWiki Stats
26,644 pages; 236,193 edits
MarketsWiki Statistics


Lead Stories

The Unemployed Trader Who Became a $700 Million Exile; Thanks to an obscure strategy known as “cum-ex trading,” Sanjay Shah became fabulously wealthy. Now regulators in several countries are after him.
Abigail Morgan and David Rovella – Bloomberg
Sanjay Shah went from being an unemployed London trader to a $700 million whale in just a few short years, all thanks to an obscure strategy called “cum-ex trading.” Now regulators in multiple countries are after him as they seek to close this legal loophole—one they say has facilitated the biggest tax heist in European history. Bloomberg Digital Originals looks behind the story of one man’s clever approach to trading, and the global consequences that followed.

TMX CEO Sees Inflation Jolting Demand for Fixed Income Futures
Kevin Orland – Bloomberg
IPO activity to remain strong as PE funds seek exits, CEO says; Exchange operator’s revenue held back by equities trading drop
Higher inflation and central banks’ response to it are driving a surge in trading of fixed-income futures that looks poised to continue in the months ahead, TMX Group Ltd. Chief Executive Officer John McKenzie said.

Heads of trading stress the importance of office interactions as asset managers grapple with hybrid work setups; Four heads of trading desks highlighted the challenges and opportunities of a hybrid working model at TradeTech.
Jonathan Watkins – The Trade
Within a hybrid work model of the future, heads of trading have reminded the industry of the benefits of teamwork, relationships and learning that can only come with in-person interaction. Speaking at the TradeTech Europe conference, the group – consisting of Invesco, Polar Capital, Liontrust and Fidelity – agreed the model of the future would be flexible, but said there is still plenty to work out.

Opinion: The Fed thinks meme stocks threaten the financial structure; retail investors say that’s kind of the point
Thornton McEnery – MarketWatch
After some detailed research, the Federal Reserve said on Monday that it is beginning to worry that the recent and unprecedented volatility in meme stocks like GameStop GME, -5.51% and AMC Entertainment AMC, -11.38% are creating pockets of risk inside markets that could create real problems for the entire U.S. financial system.

Barclays reshuffles top team after Staley exit
Lawrence White – Reuters
Barclays has appointed Paul Compton as head of its investment banking business, the British bank said on Tuesday, as part of a wider reshuffle in the wake of Chief Executive Jes Staley’s departure.

Coinbase’s Shiba Gamble, NFT Plan Fuel Wall Street Optimism
Olga Kharif – Bloomberg
To chart Coinbase Global Inc.’s momentum this year, just look at its main retail mobile app. On Oct. 29, it became No. 1 in the Google Play store for the first time. Coinbase, the largest U.S. cryptocurrency exchange and a lightening rod for regulators and critics alike, was more popular, in other words, than Instagram, PayPal or Snapchat. As one of the earliest on the scene, it is now benefiting as crypto gains more adherents, and its reach into new markets and willingness to take risks is seen by many on Wall Street as setting the stage for further growth.

Self-Described Bitcoin Creator Denies Friend Helped Mine Fortune
Jonathan Levin – Bloomberg
Craig Wright gets emotional telling jury about friend’s death; Entrepreneur’s court testimony hasn’t resolved Satoshi mystery
The self-described creator of Bitcoin emphatically denied in court that his late friend and fellow computer scientist helped him launch the cryptocurrency. While Craig Wright acknowledged that the two worked together, the Australian entrepreneur insisted in his testimony this week that they only mined Bitcoin together for test purposes, not for profit. If the jury buys that explanation it could shield Wright from having to split a $73 billion fortune he would control if he’s truly the founder of the Bitcoin ecosystem.

UK and EU in danger of “Balkanisation” of liquidity if they diverge too much, says equities head; Speaking at TradeTech 2021, head of equities at Premier Miton warned that too much regulatory divergence could lead to friction caused by a fragmented liquidity landscape.
Annabel Smith – The Trade
A buy-side head of equities trading has warned that too much regulatory divergence between the EU and the UK following Brexit could lead to the “balkanisation of liquidity”. Speaking in a regulatory fireside chat alongside the UK’s Financial Conduct Authority, head of equities at asset manager Premier Miton, Gervais Williams, told the audience that the UK and EU’s increasingly different approaches to regulating the capital markets could lead to a fragmented and friction-filled landscape for participants to navigate.

Many buy-side firms have no visibility on FX costs, study finds; The ‘hidden costs’ of FX are growing by the day, yet most firms have outsourced TCA.
Anita Hawser – The Trade
Buy-side firms are not tracking FX execution quality and more than half are overlooking more than 70% of their FX costs, new research from the National Australia Bank (NAB) and the ACI shows. The survey of global banks, brokers and investors found that 39% of buy-side firms don’t track FX execution quality including 27% of fund managers, 31% of equities managers, and 44% of fixed income managers. The findings were published in a report titled, The Grey Costs of FX: How far to true best execution?

Markets veteran Duncan Higgins to launch industry’s first trading focused sustainability initiative; The new membership network has already attracted buy-side firms and aims to address environmental challenges specific to trading firms through accountability to the wider industry and investors.
Annabel Smith – The Trade
Former ITG and UBS executive Duncan Higgins is set to launch a new environmental initiative focused specifically on the ESG needs and shortcomings of trading firms. Named Sustainable Trading, the membership network will act as a forum for trading firms to discuss trading specific environmental issues and create potential practical solutions.

The Fed Ignores a Key Bubble Risk for the Stock Market; The absence of a discussion about record low real yields in the central bank’s latest financial stability report was a mistake.
Brian Chappatta – Bloomberg
When the Federal Reserve released its semiannual financial stability report in May, I wrote that the central bank came as close as it could to saying “bubble.” So imagine what it could have said in its latest update, which was released on Monday.

Doing Fraud on Securities Fraud; Also Naked Electric Vehicles, AMC crypto miscellany, management advice and Shiba Inu arbitrage.
Matt Levine – Bloomberg
Everything, I like to say, is securities fraud. If a public company does a bad thing, or a bad thing happens to it, some creative lawyer will be able to argue that the company’s disclosure was misleading and that it defrauded its investors. Specifically, if you bought the stock before the bad thing was disclosed, and then the stock price went down after the bad thing was disclosed, you have a securities fraud claim.

Bay Area man orchestrated $1 billion Ponzi scheme, the region’s ‘largest criminal fraud,’ feds say
Jaclyn Peiser – Washington Post
The lavish lifestyle was part of the con. Jeff Carpoff and his wife, Paulette, wanted to give investors the illusion their solar energy company in the San Francisco Bay area was thriving.

UBS CEO calls for global sustainability reporting standards for private, public groups
UBS (UBSG.S) Chief Executive Ralph Hamers on Wednesday called for minimum global sustainability reporting standards that apply not just to public companies but to private assets as well.


Vaccine mandate: Employers urged to go ahead despite court challenges
Alexis Keenan – Yahoo Finance
The White House on Monday urged employers to go ahead and comply with a new vaccine mandate even though a federal appeals court temporarily blocked the requirement over the weekend.

Moderna and U.S. at Odds Over Vaccine Patent Rights; Moderna’s patent application names several employees as the sole inventors of a crucial component of its coronavirus vaccine, excluding three government scientists.
Sheryl Gay Stolberg and Rebecca Robbins – NY Times
Moderna and the National Institutes of Health are in a bitter dispute over who deserves credit for inventing the central component of the company’s powerful coronavirus vaccine, a conflict that has broad implications for the vaccine’s long-term distribution and billions of dollars in future profits.

Unvaccinated Texans 40 times as likely to die of covid as those fully vaccinated in 2021, study says
Paulina Firozi – Washington Post
A vast majority of Texans who have died of covid-19 since the beginning of the year were unvaccinated, according to a grim new Texas health department report released Monday.

Pfizer CEO says people who spread vaccine disinformation are ‘criminals’
Timothy Bella – Washington Post
Pfizer CEO Albert Bourla said Tuesday that people who spread disinformation about coronavirus vaccines are “criminals.” Bourla, in an interview with the Atlantic Council think tank, said a “very small” group has been responsible for spreading vaccine disinformation to the millions who remain hesitant about getting vaccinated.

Coronavirus infections rise in northern states, Mountain West, as holidays near; U.S. could face a fifth major wave of cases, but vaccinations and treatments would likely temper its severity
Carolyn Y. Johnson, Joel Achenbach and Jacqueline Dupree – Washington Post
At the foot of the Rocky Mountains, Tom Gonzales, director of public health in Colorado’s sixth-largest county, made a decision in mid-October that felt like a dismaying retreat in the battle against the coronavirus. He reinstated an indoor mask mandate.

The Vaccine Mandate Kicks In at 100 Employees. What If You’re at 98? For small businesses hovering just under the federal vaccination guidelines, navigating this period is tricky.
Emma Goldberg – NY Times
Christie Thompson’s company, which sells and services semitrailers, is looking to fill a handful of open positions. But the challenge isn’t just finding qualified workers. Currently, 98 people work at the company. Adding two more employees would mean crossing the 100-person threshold that the Biden administration set as its standard for compliance with a new rule requiring large companies to mandate coronavirus vaccines.

Exchanges, OTC and Clearing

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

LCH SA and Euronext N.V.
LSEG (London Stock Exchange Group) notes today’s announcement from Euronext N.V. (“Euronext”) regarding its long-term clearing arrangements with LCH SA, the Group’s leading Paris headquartered CCP. LCH SA offers clearing for a range of asset classes, with a proven track record in best-in-class service and robust risk management. As a Group we are strongly committed to LCH SA. We continue to expand and develop new products and services, reinforcing the diversified range of products cleared across asset classes.

Guest-of-Honour Speech by Tan Boon Gin, CEO of SGX RegCo at the REITAS Conference 2021
Good morning ladies and gentlemen, Wow, time flies. The REIT regulatory framework has been in place at SGX for over 21 years and we have had REITs listed on the exchange for close to 20 years. So, in a way, it feels like we are on the cusp of new beginnings as young adults heading into their 20s. The millennials have a name for this; they call it #adulting, and it signifies certain developments and new responsibilities. One change that we have seen already is the growth in sustainable investing in the REIT space, which is why we have launched the SGX Nikkei ESG-REIT Index Futures contracts, and the iEdge-UOB APAC Green Reit Index that tracks environmentally-positive REITs.

SGX welcomes Tiger Brokers as Securities Trading and Clearing Member and Derivatives Trading Member
Singapore Exchange (SGX) today welcomed Tiger Brokers to its securities and derivatives markets as a Trading Member, as well as a Clearing Member and Depository Agent of The Central Depository (Pte) Limited (CDP). Tiger Brokers is a Nasdaq-listed global online broker that was founded in 2014, providing a one-stop trading platform for customers to trade a wide range of securities across multiple global markets and currencies.

SFDR funds and secured financing: fundamentally compatible
Gerard Denham, Senior Vice President in our Eurex Fixed Income Funding & Financing team in London, recently wrote for Finadium on the subject of compatibility of SFDR funds and secured financing. Functionally, there appears to be no difficulty in establishing a positive link between SFDR transparency rules and secured funding products. For the repo market, the establishment of the green bond General Collateral baskets from Eurex Repo has created the product framework necessary for any SFDR fund to safely participate in secured funding.

Eurex Exchange Readiness Newsflash | REMINDER: Eurex T7 Release 10.0: Readiness Statement is available
With this Newsflash, we would like to remind you of the submission of the “Readiness Statement” which is required prior to the launch of T7 Release 10.0.

Veganz Group AG new in the Scale segment of the Frankfurt Stock Exchange
Deutsche Börse
Veganz Group AG (ISIN: DE000A3E5ED2 ) has been listed in the Scale segment of the Frankfurt Stock Exchange since today . The initial price of the share was EUR 86.90 and the issue price was EUR 87.00.

Unscheduled free float adjustment in the MDAX
Deutsche Börse
STOXX Ltd., Qontigo’s global index provider, has announced an unscheduled adjustment in the MDAX. The free float of Zooplus AG changes by more than 10 percentage points.

ICE Expands ESG Data Offering to 2 Million Fixed Income Securities; Coverage spans multiple geographies, including North America, Europe and Asia
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE: ICE), a leading global provider of data, technology and market infrastructure, today announced that its Environmental, Social and Governance (ESG) Reference Data coverage now includes 2 million fixed income instruments. ICE’s ESG Reference data covers equity and fixed income securities across North America, Europe and Asia and adds transparency to allow users to better understand ESG risks and opportunities.

Sngular receives favourable report from BME Growth; It will be the 14th company to join BME Growth this year
The Coordination and Admissions Committee of BME Growth has submitted to the Board of Directors a favourable report on SNGULAR following a thorough review of all the information presented by the company. SNGULAR will be the fourteenth company to join BME Growth this year.

NGX Reiterates Commitment Towards Gender Equity And Inclusion
The Nigerian Exchange Limited says it remains committed to promoting and supporting gender equality as well as creating and maintaining an environment that is free from all forms of discrimination.

— Amendments to the Bloomberg Commodity Index Futures and Bloomberg Commodity Index Swaps (Cleared OTC) Contracts — CME
— Performance Bond Requirements: FX Futures Spot Charge Rates Reminder – Effective Wednesday, November 10, 2021 — CME
— Administrative Amendments to Forty-Seven (47) NYMEX Freight Futures and Options Contracts — CME
— Availability of an Additional Three-Month Eurodollar Futures and Three-Month SOFR Futures Intercommodity Spread (SED) on CME Globex — CME
— OTC IRS Production Advisory – Release 23: USD BSBY and SGD SORA Swap Clearing — CME
— Review of Collateral Haircuts – Effective November 08, 2021 — CME
— Notice Of Disciplinary Action; NON-MEMBER: Alexandre Denlinger, CME RULE VIOLATIONS: 432. General Offenses (in part), It shall be an offense: B.1. to engage, or attempt to engage, in fraud or bad faith; H. to…intentionally or recklessly use or employ, or attempt to use or employ, any manipulative device, scheme, or artifice to defraud; or to purchase or sell, or offer to purchase or sell Exchange futures or options contracts, or any underlying commodities or securities, for the purpose of upsetting the equilibrium of the market or creating a condition in which prices do not or will not reflect fair market values; T. to engage in dishonorable or uncommercial conduct. — CME


DASH Regulatory Technologies Launches New Security-Based Swaps (SBS) Solution
Dash Financial Technologies
DASH Regulatory Technologies (DRT) – the regtech-focused affiliate of U.S. options technology and execution services provider DASH Financial Technologies – today announced the launch of a new Security-Based Swaps (SBS) add-on to its industry-leading DASH 360R regulatory reporting solution. The solution will enable firms to comply with the CFTC and SEC’s newly implemented rules specifying capital, margin and segregation requirements for U.S. broker-dealers that engage in SBS transactions.

Liquidnet Appoints Global Head Of Fixed Income Product, Services And Dealer Relations – The Firm Makes Senior Global Hire To Further Enhance Fixed Income Coverage
Liquidnet, the global institutional investment network, today announced the appointment of Nicholas Stephan as Global Head of Fixed Income Product, Services and Dealer Relations. The appointment is the latest in a series of hires in EMEA and the Americas that has significantly increased the size and expertise of the fixed income team since Liquidnet’s acquisition by TP ICAP earlier this year.


How Even Emails Leave Robinhood Users Exposed to Financial Criminals; Savvy customers who ignore the latest data breach could pay dearly if they aren’t careful.
Charlie Wells, Alice Kantor and Claire Ballentine – Bloomberg
Robinhood Markets Inc.’s customers responding with a shrug to a data breach are probably underestimating how even banal details can leave their financial information vulnerable. Mark Newman, a 54-year-old Robinhood trader from southeast Arkansas, received a notice Monday night saying his email address had been exposed. That was after a hacker stole the personal information of about 7 million users. “I’ve been on the internet since it was born and it’s to be expected,” he said.

Ransomware: How to Stop the U.S. Cybersecurity Crisis
Keith B. Alexander and Jamil N. Jaffer – Barron’s
The United States and our allies are on the verge of a very real cyber pandemic. In fact, it may already have begun.
The Department of Justice announced yesterday that a Ukrainian citizen had been arrested and a Russian citizen charged for their alleged involvement in a ransomware attack that targeted as many as 1,500 companies this summer. In the last two weeks alone, we have seen disruptive attacks against the Canadian healthcare system and an American dairy provider, as well as a revelation that Russian nation-state hackers continue to go after American companies, nonprofits, think tanks, and academic institutions at scale, stealing sensitive information and gaining strategic insights. Hardly a week goes by without news of a new ransomware attack against a local hospital, school district, police department, or other critical function. These actions include criminal activity, nation-state activity, theft of intellectual property or sensitive information, and disruptive or destructive attacks. They have the potential, given our increasing reliance on technology in our everyday lives, to pose a major threat to our economic and national security. This fact demands real, concrete action by both government and industry to get ahead of these threats and stop them before they have irreversible impact.

Cybersecurity: This prolific hacker-for-hire operation has targeted thousands of victims around the world
Danny Palmer – ZDNet
A hacker-for-hire operation offered by cyber mercenaries has targeted thousands of individuals and organisations around the world, in a prolific campaign of financially driven attacks that have been ongoing since 2015.
Human rights activists, journalists, politicians, telecommunications engineers and medical doctors are among those who have been targeted by the group, which has been detailed by cybersecurity researchers at Trend Micro. They’ve dubbed it Void Balaur, after a multi-headed creature from Slavic folklore.

Investor sues over $1.2 bln FireEye cybersecurity unit sale
Sierra Jackson – Reuters
A Mandiant Inc shareholder has sued the cybersecurity company’s board for approving the $1.2 billion sale of the company’s FireEye Inc business to a group of private equity firms without holding a shareholder vote.


Robinhood is not racing to list shiba inu coin and the short-term gains for the platform wouldn’t be in the interest of its users, crypto COO says
Isabelle Lee – Business Insider
Robinhood is not racing to list trending coins such as shiba inu, the trading platform’s crypto chief told Decrypt. Robinhood Markets is not racing to list popular, trending coins such as shiba inu because the short-term gains for the platform would not be in the interest of its users, Robinhood Crypto COO Christine Brown said during Decrypt’s live event Tuesday.

Austria Crypto Tax Will Treat Digital Tokens Like Stock
Marton Eder – Bloomberg
Cryptocurrency gains will be subject to 27.5% tax from March; Austria says tax may help build legitimacy in crypto investing
Austria says it wants to boost confidence in cryptocurrencies by taxing them like mainstream stock and bond investments. The home country to Peter Thiel-backed trading platform Bitpanda GmbH intends to apply a 27.5% capital gains levy on digital tokens like Bitcoin and Ethereum from March 2022 as part of a wide-ranging tax overhaul. More jurisdictions have been examining the imposition of taxes as the global cryptocurrency market’s value has swelled to more than $3 trillion.

Swiss Central Bank Ready to Run With wCBDC in January: ‘Just Takes a Policy Decision’
Ian Allison – Coindesk
The Swiss National Bank (SNB) says it will technically be ready to launch a wholesale central bank digital currency (wCBDC) in January of next year, using Switzerland’s newly licensed Six Digital Exchange (SDX).

Ripple launches new product for financial institutions, says clearer regulations needed
Jennifer Schonberger – Yahoo Finance
Ripple said on Nov. 9 it is launching a new product for U.S. banks and fintech firms that lets their customers invest in and trade cryptocurrencies. The new product, called Ripple Liquidity Hub, is designed as a plugin for financial institutions. “Enterprises will use Ripple Liquidity Hub to easily and seamlessly provide their end customers with the ability to buy, sell and hold digital assets at the best possible prices across a range of venues,” Ripple said in a press release. Financial institutions and fintechs will be able to offer customers the ability to trade bitcoin, ethereum, Litecoin, XRP, with more being added later.

Is Crypto Really Worth $3 Trillion? I Ran the Numbers; The potential of digital currencies is far greater than any one company today, but the risk is far higher.
Aaron Brown – Bloomberg
The total value of all cryptocurrency assets has just exceeded $3 trillion, according to Bloomberg News. It’s such a big number that it needs some context to be meaningful. Consider Microsoft Corp. and Apple Inc., which have market capitalizations that recently topped $2.5 trillion. So, the entire crypto sector is around 20% more valuable than the equity of the two biggest tech companies.

A $25 Million Bitcoin Payday Eludes Investor Rob Arnott
Vildana Hajric and Michael P. Regan – Bloomberg
Arnott recalls 2013 episode when he decided against investing; Bitcoin reached a new record this week, rallying above $68,000
When Rob Arnott became aware of Bitcoin in 2013, he found it fascinating — just not enough to place a huge bet on it. “As a libertarian, I thought, this’ll give central bankers a so-called run for their money. It’ll be fun to watch,” Arnott, founder and chairman of Research Affiliates and one of the best-known fundamental investors, said on the latest “What Goes Up” podcast from Bloomberg News.

How to Bank Your Digital Coin From Crypto to Cash
Chanelle Bessette – AP
Cryptocurrency, the blockchain-based digital currency that has captured the interest of investors and financial service firms alike, has a challenging problem. It can be hard to actually spend this currency like you would regular money. But there are new services on the horizon that could help people use bitcoin and other digital coins in more mainstream ways for their day-to-day finances.


The Crypto Industry Isn’t Too Thrilled About Biden’s Big Policy Moves
Sandali Handagama – Coindesk
The U.S. House of Representatives voted to pass the infrastructure bill that contained a provision that shook the crypto world. Financial regulators called on Congress to regulate stablecoins. In other words, crypto had a big week in Washington, D.C.

Chinese Virus Expert Launches Scathing Attack on Covid Zero Push
Bloomberg News
China should determine how much protection its vaccines offer; Virologist disparaged rigid controls in rare public criticism
A top Chinese virologist warned the country risks economic collapse if local officials continue to try to wipe out all traces of Covid-19, marking the most vocal criticism of China’s so-called Covid Zero approach by one of its own experts.

Britain’s game of Brexit chicken will end badly; In threatening to repudiate its deal with the EU, the UK is undermining its credibility as a reliable partner
Martin Wolf – FT
Boris Johnson won the general election of 2019 on the promise that he would get Brexit done. But it has not been done. Instead of stabilising, post-divorce relations are worsening. Not surprisingly, they are most fraught where the responsibilities remain shared. Fisheries are one such point of contention. But the most dangerous by far is Northern Ireland. Back in October 2019, Johnson declared he had reached a “great new deal”. Now he would like to tear it up. That is characteristic, alas. But it is dangerous not just for the UK, but also for the EU and wider west.

City of London’s quaint approach to pre-emption needs an update; UK’s review of capital raising considers principle of giving shareholders first option to buy ‘sacrosanct’
Helen Thomas – FT
If social security is the third rail of US politics, pre-emption is the untouchable core of London market governance. The idea that existing shareholders should get first dibs when companies raise money, rather than having stakes forcibly diluted, is regarded as faintly peculiar in the hurly-burly of the US capital markets. But it is a concept guarded with quasi-religious fervour within the Square Mile (and, indeed, is enshrined in UK corporate law).

Oil price rise another reminder of Saudi Arabia’s lever over Biden; Kingdom’s refusal to pump more oil blamed on US president’s coolness towards crown prince
Andrew England – FT
As American motorists face soaring fuel prices, Saudi Arabia once more finds itself the focus of Joe Biden’s frustration. When the US president bemoaned the failure of the world’s top oil producers to pump more crude to help bring down prices, he singled out two countries: traditional adversary Russia and longtime partner Saudi Arabia. Speaking at the G20 meeting last month, Biden said their failure to produce more “so people can have gasoline to get to and from work . . . [was] not right”.

Rising Oil Prices Put Biden in a Bind Over Climate Pledges; White House mulls its limited options to boost supply; critics say situation exposes flaws in president’s climate-change agenda set out at COP26
Benoit Faucon and Timothy Puko – FT
Rising oil prices have handed President Biden a dilemma at a politically precarious time. His administration’s ambitious agenda to stem global warming calls for a shift away from fossil fuels. Yet Mr. Biden is now urging the Organization of the Petroleum Exporting Countries to increase production to ease shortages and lower prices.


California man gets 30 years in prison for $1B Ponzi scheme
Don Thompson – AP
The owner of a San Francisco Bay Area solar energy company was sentenced to 30 years in federal prison Tuesday for an audacious Ponzi scheme that defrauded investors of $1 billion. It’s the biggest criminal fraud scheme in the history of the federal court district that covers inland Northern California, said Acting U.S. Attorney Phillip Talbert.

Former Quantum Resources director convicted of insider trading and market manipulation offences
Avrohom Mordechai Kimelman, of St Kilda East, Victoria, has been sentenced to 18-months imprisonment, to be released immediately upon entering into a $5000 recognizance and an undertaking to be of good behaviour for two years, after being convicted of insider trading and market manipulation offences in the County Court of Victoria.

Lars Windhorst Tweets He Settled Dispute With German Watchdog
Eyk Henning – Bloomberg
Investigation related to funds raised to pay back H2O; Dutch court last week declared Windhorst’s holding insolvent
German financier Lars Windhorst said Germany’s watchdog Bafin cleared him from allegations that a financing vehicle he set up to pay back investment firm H2O Asset Management breached banking rules.

US justice department warns of impending corporate crime crackdown; Senior official signals intent to bring cases against ‘some of the largest’ companies within weeks
Stefania Palma – FT
The US Department of Justice is preparing to launch a crackdown on wrongdoing by companies with the first cases expected within weeks, a top official has warned, after the Biden administration pledged to take a tougher stance on corporate crime. In an interview with the Financial Times, John Carlin, a senior official working on the department’s crackdown, said “you’ll see cases in the weeks to come” involving “some of the largest corporations” operating in the US.

SEC Charges Partner at Global Consulting Firm With Insider Trading
The Securities and Exchange Commission today charged Puneet Dikshit, a partner at a global management consulting firm, with illegally trading in advance of a corporate acquisition by one of the firm’s clients in September.

Participant Data Management (PDM) System
FINRA member firms have an obligation to report over-the-counter secondary market transactions in eligible equity and fixed income securities to one or more of the following FINRA trade reporting facilities, TRACE, ORF and ADF. Member firms obtain access to these facilities by completing a FINRA Participation Agreement (FPA) and for members who report via the TRAQS web application by submitting the FINRA Order Form.

FINRA Orders Aegis Capital Corp. to Pay $1.7 Million in Restitution to Customers Whose Accounts Were Excessively and Unsuitably Traded; Two Supervisors Fined, Suspended for Failing to Respond to Red Flags; Representatives Sanctioned; Firm Also Fined $1.1 Million for Supervisory Failures
FINRA announced today that it sanctioned Aegis Capital Corp. approximately $2.8 million, including $1.7 million in restitution to 68 customers whose accounts were potentially excessively and unsuitably traded by the firm’s representatives. FINRA also imposed a $1.1 million fine for Aegis’ supervisory violations.

FCA and Bank sign joint MoU with FMSB
Jointly with the Bank of England, we have signed a Memorandum of Understanding (MoU) with the Fixed Income, Currencies and Commodities Markets Standards Board (FMSB). The MoU sets out a high-level framework formalising the continuing cooperation between the FCA, the Bank and FMSB in relation to the delivery of FMSB’s primary objectives as recommended in the Fair and Effective Markets Review Final Report.

Auditors respond well to challenges presented by COVID-19
Auditors have responded well to financial reporting challenges presented by the pandemic, according to the Financial Markets Authority (FMA) – Te Mana Tatai Hokohoko Audit Quality Monitoring Report for 2020/21.

ISDA: EMIR Reporting Best Practices
The cross-trade association EMIR Reporting Best Practices was initially developed and published in March 2021, covering both over-the-counter and exchange-traded derivatives. These best practices were developed to improve the accuracy and efficiency of trade reporting and to reduce compliance costs, and are available to all market participants to access and implement.

Investing and Trading

Global Equity Markets Primer
The U.S. cash equity markets are the largest in the world and continue to be among the deepest, most liquid and most efficient. This primer – one in the Primer Series by SIFMA Insights – is a thorough comparison of equity markets across the globe, analyzing data on market size, formation, performance and costs, as well as markets in indexes.

Reddit’s Latest Money-Making Obsession Is an Obscure Fed Facility
Alex Harris – Bloomberg
Every day in the early afternoon, money-market traders are glued to the Federal Reserve Bank of New York’s website to see the results of the overnight reverse-repurchase agreement facility.

How to choose an investment trust; Gearing, charges and discounts are just some of the factors investors should consider when picking a trust
Lucy Warwick-Ching – FT
Investment trusts have seldom been the first port of call for Britain’s retail investors, who prefer the familiarity of conventional open-ended funds and direct stakes in listed companies. As returns-hungry investors seek new opportunities, however, what was once “the City’s best-kept secret” is moving into the mainstream.

Environmental, Social and Corporate Governance

Green Markets Put World’s Poor at Mercy of Higher Funding Costs; Rich nations aren’t delivering on funds needed to help climate-vulnerable countries deal with climate change, so they’ll have to rely on the goodwill of private investors
John Ainger – Bloomberg
From up high in the eastern Himalayas, Bhutan is one of the only countries that can say it’s doing more to cool the planet than warm it. But the nation of fewer than 1 million people, dotted with lush mountains that absorb heat-trapping carbon dioxide, isn’t rewarded for its low emissions or shielded from the devastating effects of climate change.

Europe’s Stricter Green Bond Rules See First Use by Market
Greg Ritchie – Bloomberg
Swedish company’s green framework to align to EU standard; Borrowers preparing for company reporting rules: Handelsbanken
The European Union’s “gold standard” rules for green bonds are starting to be used by the market, even before the bloc approved them. Swedish property company Dios Fastigheter AB will present its new green financing framework to investors on Wednesday, which it says is aligned to the EU’s proposed green bond standard. Svenska Handelsbanken AB, which advised Dios, believes it is the first to adapt to the bloc’s regulations.

Bonds are an ESG blind spot in investing; The push by fund managers for decarbonisation and social responsibility is primarily an equity market phenomenon
John Plender – FT
A strangely paradoxical feature of current markets is how global capital manages to be both supportive and subversive of the environmental, social and governance agenda that has been a central focus of investor attention around the COP26 climate change summit.

COP, coal, and unabated optimism
Eamon Barrett – Fortune
With days left to go at COP26 in Glasgow, opinion on whether the climate summit has achieved anything meaningful or simply produced more hot air remains divided. But one positive development from last week’s events, at least, came Thursday, when over 40 countries signed the Global Coal to Clean Power Transition statement, pledging to cease approval for new “unabated coal-fired power generation.”


BofA Building Up Capital-Markets Unit as Montag Set to Depart
Katherine Doherty – Bloomberg
Bank of America Corp. is building its capital-markets business to be even more competitive as longtime leader Thomas Montag steps aside, Chief Executive Officer Brian Moynihan said.

Barclays New CEO Venkatakrishnan Reshuffles Bank’s Top Ranks
Stefania Spezzati – Bloomberg
Compton to be sole head of corporate and investment bank; Staley abruptly resigned last week amid U.K. regulator probe
Barclays Plc’s new chief executive officer C.S. Venkatakrishnan reshuffled some of the bank’s key leadership roles, as he makes his mark on the lender in his second week atop the bank.

Beware of Bankers Bearing Pre-IPO Gifts; A Morgan Stanley plan to invite its wealthiest clients to buy shares in startups before they go public sounds exciting. So does scaling cliffs without a rope.
Alexis Leondis – Bloomberg
Bulletin for investors intrigued by reports that Morgan Stanley is planning to give its very wealthy clients exclusive access to shares of buzzy startups before they go public: Be very afraid.

Banks Led by JPMorgan Have $125 Billion for You; With lenders releasing money set aside for defaults that never came, banks are earning last year’s profits and this year’s together.
Paul J. Davies – Bloomberg
Big banks are rolling in free cash, but investors are struggling to believe that some of them will ever hand it over. They should take another look.

Hedge fund Millennium returns billions to clients in shift to long-term assets; One of the industry’s best-performing firms is seeking to lock in investors’ money for longer
Laurence Fletcher – FT
Millennium Management, one of the world’s biggest hedge funds, is returning about $15bn to investors while also raising billions of dollars in a private equity-style format as it tries to build a longer-term, more stable asset base.

Element Capital hit with $1bn loss in bond market shake-up; Hedge fund run by Jeffrey Talpins is among highest-profile losers from fixed income ructions
Laurence Fletcher – FT
Element Capital sustained a roughly $1bn loss last month, making the New York hedge fund run by Jeffrey Talpins one of the highest-profile victims of the October tumult across bond markets.

American Century accused of ‘closet indexing’ in lawsuit; Complaint says fund’s strategy does not justify the high fees
Ben Miller – FT
An investor has sued asset manager American Century for offering an actively managed fund that too closely resembles its index. Fund documents filed on November 5 state that the managers of the $2.4bn American Century Value Fund select companies for the fund that are undervalued, and hold those stocks until their values reach or exceed the level that the managers believe accurately reflect the company’s fair value, according to the complaint. But, in practice, the fund’s investment strategy “closely tracks the performance” of its benchmark, the Russell 1000 Value, the lawsuit states.

Blackstone Turns Sluggish Credit Business Into a Winner; Investment firm uses low-fee formula to attract individual investors to credit funds in push to gather $1 trillion of assets
Matt Wirz – WSJ
Blackstone Inc. BX 3.06% towers over most of its private-equity peers with $731 billion in assets, but the firm has had a soft underbelly for years: its sluggish lending business. Now, credit has become one of the firm’s fastest-growing segments, part of a broad shift under the leadership of President Jonathan Gray.


Australia’s disorderly exit exposes the flaws of yield curve control; Reserve Bank’s struggle holds lessons for other central banks, experts say
Sophia Rodrigues – FT
The Reserve Bank of Australia’s chaotic exit from yield curve control last week, after markets crashed through its cap on three-year bond yields, illustrates the growing pressure on central banks to tighten monetary policy as the world economy recovers from the pandemic.

China’s factory gate inflation soars to 26-year high on energy crunch; Producer prices rise 13.5% in October in fastest gain since 1995 as stagflation fears mount
William Langley and Edward White – FT
Factory gate prices in China rose at their fastest pace in 26 years in October, as crippling power shortages and record commodity prices hit the world’s second-biggest economy.


Business Travel Seen in ‘Structural’ Decline in Post-Covid Era
Tara Patel – Bloomberg
AlixPartners cites impact of hybrid work, fewer internal trips; Shrinking market could see fare wars, more consolidation
As the airline industry struggles to recover from a deep, pandemic-induced slump, another crisis is looming in the crucial business travel market, according to a new report.

Bill Ackman tries to win neighbours’ support for divisive glass penthouse; Hedge fund manager must convince board of prewar New York building to back modernist addition
Joshua Chaffin – FT
For a hedge fund manager known for his supreme self-assurance, Bill Ackman was uncharacteristically solicitous — almost humble — as he addressed the crowd. The veteran of corporate raids and rancorous short selling campaigns was not speaking to a shareholder meeting or making a public case against an overvalued stock. Rather, he was trying to persuade a more disputatious crowd: the members of community board seven who live on Manhattan’s Upper West Side. Ackman desperately wanted them to support a Norman Foster-designed renovation of his penthouse on West 77th street.

How a 12-Year-Old From New Jersey Became the Youngest Chess Grandmaster Ever; Abhimanyu Mishra and his father booked one-way tickets to Hungary for a chance at history. ‘You will never be 12 years old again.’
Joshua Robinson and Andrew Beaton – WSJ
Once Abhimanyu Mishra and his father bought one-way tickets to get them from Englishtown, N.J., to Budapest, there was no turning back. The pandemic was still raging, but that tiny pathogen didn’t stop the countdown clock separating a 12-year-old boy known as Abhi from history. Mishra was on a mission to become the youngest ever chess grandmaster.

John Lothian Newsletter

We visit more than 100 websites daily for financial news (Would YOU do that?)

“John Lothian and Company… our industry intelligence.”

Rick Lane

CEO, Trading Technologies

Past JLN Newsletters

Pin It on Pinterest

Share This Story