Tokyo Stock Exchange head hits out at foreign investment rule

Oct 11, 2019

First Read

Hits & Takes
By JLN Staff

I want to thank all the musicians who performed last night at the ALTSO Rocktoberfest and all those who helped make the event a huge success. You did good last night. It was fun and it was great to see all the incredible talent on display.~JJL

I want to thank the sponsors of the ALTSO Rocktoberfest for their support of this great event and charity: AMDIS, CME Group, ICE, Oranj, Chicago Trading Company, ED&F Man Capital Markets, Netrix, Kraken, OCC, ABN AMRO, BT (I can’t tell who this firm is by their logo), Cboe, Gate 39 Media, Mizuho, Mosaique and Wedbush Futures.~JJL

The American Financial Exchange will file with the Commodity Futures Trading Commission (CFTC) to become a Designated Contract Market (DCM) under the name AMERIBOR Benchmark Futures Exchange™ (ABFX™).~JJL

Travis Schwab, CEO of Eventus Systems, has joined the Connamara Advisory Board.~JK

The CFTC is now SHOUTING and using clickbait in order to get a press releases read. “IN CASE YOU MISSED IT: Chairman Tarbert Comments on Cryptocurrency Regulation at Yahoo! Finance All Markets Summit,” is the headline I refer to.~JJL

The new LabCFTC director is Melissa Netram, formerly the director of global public policy and regulatory affairs for Silicon Valley-based Intuit.~JJL

Alessandro Cocco will join the Economic Research department for the Chicago Federal Reserve on October 21 as vice president of the Financial Markets Group. Cocco will report to Senior Vice President Sam Schulhofer-Wohl.~JJL

David S. Slovick has joined Barnes & Thornburg’s Washington, D.C., office as a partner in the firm’s Litigation Department.~JJL

Suzanne Cosgrove’s first day with JLN was yesterday. We welcome her to the team. She will be starting work on MarketsWiki and helping our options coverage to support Matt Raebel as he learns the beat.~JJL

My 40th high school graduation reunion is this weekend. I graduated from Glenbrook South High School in Glenview, IL in 1979. Among my classmates were ED&F Man’s Monica Mulvihill and Tracey Lowenthal, the wife of Cboe executive Andrew Lowenthal.~JJL

If you haven’t listened to our newest episode of the CryptoMarketsWiki Podcast, click HERE to listen! This week, we talked to Alexandra Prodromos.~MR

++++

Jacob Morowitz: Open Outcry Traders History Project
JohnLothianNews.com

Jake Morowitz came to the Chicago Board of Trade as a philosophy major and a member of the Students for a Democratic Society. A former professor recruited him to come work in the markets and he was hired as a researcher. He bought his first membership with the help of Leslie Rosenthal. He talks about his interaction with one of the FBI moles who was in the soybean pit. After leaving the exchange and spending some time in Paris, France, Morowitz returned to the exchange and formed USA Trading to help clear fellow traders. Today USA Trading is a division of INTL FC Stone. Here is Jake’s story of coming to the markets and trading in them.

Watch the video »

++++

London Stock Exchange launches Green Economy Mark and Sustainable Bond Market
London Stock Exchange
Initiatives underline LSEG’s commitment to supporting sustainable finance and investment
London Stock Exchange today announces the launch of two initiatives supporting sustainable finance on its markets. The Green Economy Mark recognises listed companies with 50% or more of revenues from environmental solutions, while the Sustainable Bond Market (SBM) incorporates new Sustainability, Social and Issuer-Level Segments. These initiatives are designed to support issuers implementing sustainable business models, and investors who are increasingly focusing on environmental products and services supporting the transition to a low carbon economy.
bit.ly/2IFaGkY

*****In the end, Kermit the frog always wins. Green is the new black.~JJL

++++

Gamers Want to Get Blizzard in Trouble With China
Eric Newcomer – Bloomberg
A potential international incident started on Tuesday, when one Reddit user posted, “It would be such a shame if Mei from Overwatch became a pro-democracy symbol and got Blizzard’s games banned in China.” If your head started spinning when you read that, let me explain. First, some definitions: Overwatch is a popular video game made by Blizzard Entertainment, part of the $41 billion company Activision Blizzard, which sells games and has business partners in China. Mei is a parka-clad, icicle-shooting Chinese character from Overwatch. China is a country whose government has recently proven to be quite sensitive about pro-democracy symbols and speech, and willing to punish companies that speak out against it.
/bloom.bg/2OKvxXA

**** As a gamer myself I can say nerd rage is a thing, and when stirred to action gamers can be quite creative in their wrath. This issue has the whole community really worked up and pulling in one direction. In 2018 the gaming industry generated $135 billion in revenue (much bigger than music or movies and a fair bit bigger than television revenues). It is neither a small nor a fringe thing. The problem is these companies want a piece of the even bigger Chinese market – so work to appease them.~JB

++++

++++

CryptoMarketsWiki Coin of the Week: Chainlink (LINK)
The LINK token was easily the best-performing altcoin in the crypto market this week, seeing a 33 percent net increase in value – outperforming even bitcoin (BTC). The biggest news for Chainlink this week – which may have contributed to the price increase – was that Chainlink, along with Intel and Hyperledger, will be launching a new enterprise-level blockchain software product.
bit.ly/2mbMzBY

++++

Thursday’s Top Three
Our top read story was Reuters’ piece, U.S. online brokers still profiting from ‘dumb money’ which highlights how brokers can make money on free trades such as:
interest earned on customer cash balances and margin lending. Second was more of the same with Bloomberg’s Brokers Profit From You Even If They Don’t Charge for Trading. Third was Bloomberg’s The Master of Robots Left AQR. Now He’s Coming for Wall Street, about AI guro Marcos Lopez de Prado. The top 3 stories yesterday were the first 3 stories in the Leads section. We don’t recall that ever happening before.

++++

MarketsWiki Stats
164,810,382 pages viewed; 23,944 pages; 221,780 edits
MarketsWiki Statistics

++++

CryptoMarketsWiki Website»

CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.Recently Updated Pages

Recently updated pages include
Internal Revenue Service (IRS)
UNICEF
Numerai
Crypto Rating Council

CryptoMarketsWiki Stats

1,280 pages; 11,260 edits
CryptoMarketsWiki Statistics

Lead Stories

Tokyo Stock Exchange head hits out at foreign investment rule; Japan’s ‘idiotic’ attempt to tighten company ownership law risks damaging markets, says JPX chief
Leo Lewis and Robin Harding – FT
The head of the Tokyo Stock Exchange has condemned a Japanese government proposal to sharply tighten rules on foreign investment as “idiotic” and a threat to Japan’s standing in global financial markets.
/on.ft.com/2VAcuRy

Euronext targets data and private markets in new strategic plan
Philip Stafford – FT
Euronext plans to push deeper into data, private markets and sustainable investing as part of a new three-year strategic plan it published late on Thursday.
/on.ft.com/35mkwSx

Tullett Prebon fined £15.4 million for broker conduct failures; The rates division at Tullett Prebon engaged in improper trading with lax controls and systems in place to monitor broker conduct.
Hayley McDowell – The Trade
Interdealer broker Tullett Prebon has been fined £15.4 million by the UK’s Financial Conduct Authority (FCA) for failures related to controls around broker conduct.
bit.ly/317QgaD

*****HERE is the UK FCA announcement.~JJL

Fourth Straight NASDAQ Patent Invalidated by PTAB in Favor of MIAX
PR Newswire
Miami International Holdings, Inc. (MIH), the parent holding company of the MIAX Options®, MIAX PEARL® and MIAX Emerald™ exchanges (MIAX), today announced that a fourth Nasdaq patent asserted against MIAX as part of its infringement complaint has been found invalid by the Patent Trial and Appeal Board (PTAB) of the United States Patent and Trademark Office. The PTAB ruled in its final written decision that all 38 claims of Nasdaq’s U.S. Patent No. 7,747,506 are unpatentable under 35 U.S.C. Section 101.
/yhoo.it/315pcst

CFTC says cryptocurrency ether is a commodity, and ether futures are next
Daniel Roberts – Yahoo Finance
Last December, the Commodity Futures Trading Commission (CFTC) issued a public call for feedback to “better inform the Commission’s understanding” of the Ethereum network and the cryptocurrency ether.
/yhoo.it/33iThpT

Little evidence of closing auctions deteriorating price formation, says AMF
Hayley McDowell – The Trade
The surge in trading activity occurring at the end of the day in closing auctions in recent years has not deteriorated the price formation process, according to France’s financial watchdog.
bit.ly/2p7c1tL

Fed finalises rules easing regulations for banks; Changes prompt one governor to warn of increased risk to financial stability
Kiran Stacey – FT
The US Federal Reserve has finalised a new set of rules that will allow many banks to reduce their capital and liquid assets, prompting a dissent from one governor who warned that the changes “increased risk to financial stability”.
/on.ft.com/33h0A1k

Credit Suisse’s Largest Investor Says Spygate Story Was Planted
Patrick Winters and Jan-Henrik Foerster – Bloomberg
Credit Suisse Group AG’s largest shareholder reiterated his support for the bank’s top leadership after a recent spying scandal, casting doubt on key details of the drama and saying that the whole furor was stirred up by the leaks of a public relations firm in the press.
/bloom.bg/33lZCkn

Wall Street Rush to Safety Is Biggest Since Lehman Brothers Collapse
Michael Msika and William Canny – Bloomberg
Investors suffer ‘bearish paralysis,’ BofAML strategists say; Contrarian view suggests S&P 500 should extend bull run
Investors haven’t been this bearish since the collapse of Lehman Brothers. At least that’s what their positioning is signaling, according to Bank of America Merrill Lynch strategists.
/bloom.bg/35ttqgP

Jump Capital principal says improving capital efficiency is key for industry
Aislinn Keely – The Block Crypt
Peter Johnson, principal at Jump Capital, thinks lack of capital efficiency is one of crypto’s biggest pain points, and says improving it in the space is key. This means finding traders safer and more efficient ways to settle, he said on this week’s episode of The Scoop.
bit.ly/2OD35a9

For a few dollars more: global funds take on FX risk
Saikat Chatterjee, Hideyuki Sano, Gertrude Chavez-Dreyfuss – Reuters
Some European and Japanese bond investors are taking on more currency risk by buying dollar debt without protecting themselves against potentially devastating exchange rate swings as they seek ways to compensate for sub-zero yields at home.
/reut.rs/32jw4DO

CME’s physical aluminum delivery gains traction in Asia warehouses
Min Zhang, Shivani Singh – Reuters
CME Group Inc’s physical delivery of aluminum has gained traction since September after expanding its warehousing network beyond the United States into Europe and Asia, fueled by growing liquidity in Asian market, a company official said.
/reut.rs/2B4jIDM

IOSCO World Investor Week Gives Impetus To Investor Education And Protection
Mondovisione
On 6 October, members of the International Organization of Securities Commissions (IOSCO) closed the third annual World Investor Week but their efforts to promote investor education and protection will help investors now and well into the future.
bit.ly/2B0SRbG

Exchanges, OTC and Clearing

Euronext announces new three-year strategic plan
Euronext
Euronext, the leading pan-European exchange, today announced its new three-year strategic plan, “Let’s Grow Together 2022”. Since its 2014 carve-out, Euronext has expanded substantially, maintaining its trademark operating excellence as it grew organically. Over the last five years, the Group has profitably diversified into new asset classes and services, and extended its federal model to welcome Ireland and Norway’s market operators.
bit.ly/2VtvqBl

HKEX Management Appointment
HKEX
David Graham, Head of Listing to retire at the end of 2019; Bonnie Y Chan appointed as new HKEX Head of Listing, effective 2 January 2020
Hong Kong Exchanges and Clearing Limited (HKEX) is today (Friday) pleased to announce the appointment of Bonnie Y Chan as its new Head of Listing. Ms Chan will join the company on 2 January 2020 and assume responsibility for the Listing Department. Ms Chan will succeed David Graham who retires at the end of 2019, having surpassed the normal retirement age for HKEX employees. She will report to HKEX Chief Executive Charles Li, and will become a member of the Group’s Management Committee.
bit.ly/33ix5fu

Date for arrowhead Upgrade
JPX
Tokyo Stock Exchange will start production operations of arrowhead upgrade on November 5, 2019(Tue.), as previously scheduled.
bit.ly/2M9kOoe

US clearers move to dole out losses besides default; ICC wants members to chip in on investment and custodial losses
Steve Marlin – Risk.net
A long-simmering debate in the clearing world on who should swallow losses that have nothing to do with defaults received a jolt as two US clearers proposed ways of divvying up part of those costs among their members.
bit.ly/2B3rQnX

Montréal Exchange Interest Rate Derivative Trading Ceases At 1:30P PM. Today – Exchange’s Markets Closed On October 14, 2019
Mondovisione
Interest rate derivative trading will cease at 1:30 p.m. today, October 11, 2019. Furthermore, the Exchange’s markets will be closed on October 14, 2019.
bit.ly/2Mac9lr

Nasdaq Builds European Data Business
MarketsMedia
Nasdaq, the US exchange group, is aiming for more than 30% of its European data business to come from outside its traditional market data offerings.
bit.ly/2VwrWht

Nigerian Stock Exchange Reviews Rules On Pricing Methodology
Mondovisione
The Nigerian Stock Exchange (The Exchange or NSE) is pleased to announce the amendment to the rules on Pricing Methodology; price movements of equity securities traded on The Exchange. The amendments, which will be effective on Friday, October 11, 2019 are to Rules 15:29.2. C.2 of the Rulebook of the Exchange, 2015 (Dealing Members’ Rules). Specifically, the amendments relate to the minimum trade quantity required to change prices for equity securities traded on The Exchange.
bit.ly/2M7B35a

Fintech

Better data on modern finance reveals uncomfortable truths; It is unnerving that the shadow banking sector is swelling, given its role in the financial crisis
Gillian Tett – FT
What the heck is happening in the Cayman Islands? That is a question often asked in relation to corporate tax. This week, for example, the OECD called for an end to the loopholes that let global companies cut their tax bills in places like the British overseas territory.
/on.ft.com/2IHx8tE

AI Has a Solution to Finance’s Bias Toward Mini-Me Lacrosse Bros; A startup says it can use algorithms to screen a more diverse pool of job seekers.
Erik Schatzker – Bloomberg
It’s been one of the safest bets on Wall Street: Study business at Wharton, Harvard, or the University of Chicago and apply for a job in investment banking. Play squash or lacrosse? That helps. So can the right fraternity or club.
/bloom.bg/2IHw8Wq

CFTC Taps Intuit Exec to Lead Fintech Hub
Bloomberg
The Commodity Futures Trading Commission is bringing on Melissa Netram, a senior government policy executive at Intuit Technologies, to lead for the agency’s fintech innovation group.
bit.ly/2ooq7XR

Cryptocurrencies

Bakkt is looking to beat CME to the punch on options tied to bitcoin
Frank Chaparro – The Block Crypto
It wants to beat its rival CME, which is eyeing a 1Q20 launch for its own bitcoin option contract
Intercontinental Exchange’s cryptocurrency venture Bakkt is eyeing the launch of an additional derivative tied to the bitcoin market, according to several sources with knowledge of the firm’s product roadmap.
bit.ly/2papRvy

DOJ charges cryptocurrency miner for stealing $5M worth of computing power
Steven Zheng – The Block Crypto
The U.S. Attorney’s Office for the Western District of Washington has formally charged Ho Jun Jia, a Singapore citizen, for allegedly stealing computing power and services to mine cryptocurrencies. According to the U.S. Attorney’s office, between Oct. 2017 and Feb. 2018, Ho ran a “large-scale cryptocurrency mining operation.” Ho allegedly funded his operation using stolen identity and credit card information to rent cloud computing power from multiple cloud service providers, using the power to mine cryptocurrencies like bitcoin and ether.
bit.ly/2B4TqRW

Coinbase is launching Coinbase Pro mobile app
Romain Dillet – Tech Crunch
Cryptocurrency exchange company Coinbase is launching a mobile app for its advanced users today. You can now download the Coinbase Pro mobile app on iOS — the Android version is coming soon. Coinbase Pro is the company’s exchange that lets you set up advanced order types, such as limit orders. Those are fairly standard features for a cryptocurrency exchange. But Coinbase set up a separate “pro” platform so that the main Coinbase.com exchange remains as simple and straightforward as possible.
/tcrn.ch/324O452

Libra Is A ‘Better Paypal,’ Not A Liberating Currency Like Bitcoin, ETH, XRP, And LTC
Panos Mourdoukoutas – Forbes
Facebook’s global currency, Libra, is ‘another’ payment system – ie, a better version of Paypal, but not a liberating currency like Bitcoin and other major cryptocurrencies. That’s according to Alex Karasulu, CEO and founder of OptDyn.
bit.ly/2M7Uw5C

Cryptocurrency Exchange OKEx Korea Delists XMR, DASH, ZEC, ZEN, SBTC
Adrian Zmudzinski – Cointelegraph
Cryptocurrency exchange OKEx Korea announced the end of Monero (XMR), DASH, Zcash (ZEC), Horizen (ZEN) and Super Bitcoin (SBTC) trading as of today, Oct. 10. Per the Oct. 2 announcement, the assets have been delisted today. A previous version of the announcement was published on Sept. 10. That being said, since then the support for privacy coins ZEC and DASH has been defined as temporarily suspended due to regulatory concerns.
bit.ly/33lPTur

China’s central bank hiring 6 tech experts for its upcoming digital currency
Yogita Khatri – The Block Crypto
The People’s Bank of China (PBoC), the country’s central bank, is hiring six more tech experts for its upcoming digital currency.
bit.ly/35svxkW

Bank of America Is Now Hiring in Blockchain, Not Just Filing Patents
Nathan DiCamillo – Coindesk
The second-largest U.S. bank has begun hiring for blockchain positions. The job openings, which appeared in recent months, are the first indicator that Bank of America plans to do much else with the technology apart from 78 blockchain-related patents the bank has filed or won to date.
bit.ly/33lO2py

Libra is ‘inevitable,’ better to embrace it, says its investor, a French billionaire
Yogita Khatri – The Block Crypto
French tycoon Xavier Niel, founder of telecoms group Iliad and one of the investors in the Facebook-led stablecoin project Libra, has said that Libra is “inevitable” and “will exist” like the other 1,000+ cryptocurrencies in market.
bit.ly/2oBtwCq

Binance Adds XRP-Pegged Token to Its Decentralized Exchange
William Foxley – Coindesk
Binance, the world’s top cryptocurrency exchange by volume, announced Thursday the issuance of the second cryptocurrency ever onto its affiliated decentralized exchange (DEX), Binance Chain.
bit.ly/35rIwDy

Australia’s Gold Mint Is Backing a Crypto Token Based on Ethereum
Daniel Palmer – Coindesk
Australia’s only bullion mint is backing a new digital token aimed to allow investors to trade the precious metal in real time. The Perth Mint Gold Token (PMGT) was launched by InfiniGold on Friday, and is backed 1:1 by GoldPass certificates issued by The Perth Mint. The digital certificates are 100% gold backed and guaranteed by the Government of Western Australia, which is the sole owner of the 120-year-old mint.
bit.ly/35qeGQ4

States Look to Define Cryptocurrency Activity for Payments Laws
Lydia Beyoud – Bloomberg Law
State regulators are asking for comment on harmonizing payments laws, including defining how virtual currency fits into exist payments frameworks. The Conference of State Bank Supervisors on Oct. 10 issued proposed model legislation covering state money transmission rules and payments regulations. The goal is to streamline state definitions and laws for companies, particularly startups, seeking to more easily reach nationwide scale.
bit.ly/2nBE58a

Politics

Rudy Giuliani Draws Prosecutors’ Scrutiny With Ukraine Allies’ Arrest
Greg Farrell and Chris Strohm – Bloomberg
Parnas, Fruman helped Giuliani in work for Trump, lawyer says; Democrats subpoenaed all communications between men, Giuliani
Rudy Giuliani, President Donald Trump’s attorney, is being scrutinized by federal investigators for his financial dealings following the indictment of two of his associates for violating campaign finance laws, according to a law enforcement official.
/bloom.bg/2IF3JAo

Deutsche Bank Might Have Destroyed Physical Copies of Trump’s Tax Returns, Cleansed Servers, Claims Former Executive: Report
Shane Croucher – Newsweek
A former Deutsche Bank executive who reviewed President Donald Trump’s tax returns reportedly said it is “not normal” that the institution no longer holds copies of those records.
Trump for many years relied on Deutsche Bank for loans to sustain his real estate business when many other institutions would not lend to him because of his rocky financial history.
bit.ly/2pa3PZK

Political Campaigns Know Where You’ve Been. They’re Tracking Your Phone.
Sam Schechner, Emily Glazer and Patience Haggin – The Wall Street Journal
When Donald Trump took the stage last month in Fayetteville, N.C., to support Republican candidate Dan Bishop in a special election, thousands of people showed up. Mr. Bishop was seeking their support. An outside Republican group was looking for something more. It wanted their data. Unknown to the crowd, the Committee to Defend the President, a Republican political-action committee that supports Mr. Trump, had hired a company to collect unique identification numbers from attendees’ smartphones that evening, based on location data those phones were sending to third parties.
/on.wsj.com/2M5Sx1v

2 Giuliani Associates Arrested With One-Way Tickets at U.S. Airport
Mark Mazzetti, Eileen Sullivan, Adam Goldman and William K. Rashbaum – The New York Times
Lev Parnas and Igor Fruman, associates of President Trump’s personal lawyer, were part of the pressure campaign on Ukraine to investigate Democrats. Federal prosecutors unsealed charges on Thursday against two men who have aided President Trump’s efforts to gather damaging information in Ukraine about his political opponents, a criminal case that signaled growing legal exposure for the president’s allies as Mr. Trump tries to blunt an impeachment inquiry in Congress.
/nyti.ms/3291yMT

The serious danger of politics as tribal conflict
Michael Gerson – The Washington Post
The most serious, practical, pressing problem with politics as tribal conflict is the inability to draw moral lines against offensive, unethical and dangerous behavior. If our public life is reduced to the binary choice between one side that we think will save the country and another that will surely destroy it, then leaders from our side are always preferable, no matter what norms they violate or institutions they wreck. If the victory of our cultural team is all that matters, then the methods our leaders employ become secondary to the point of insignificance. And objecting to objectionable methods is seen as giving aid and comfort to the enemy.
/wapo.st/325XpJD

U.S.-China currency deal won’t change dollar-yuan dynamics: experts
David Lawder – Reuters
A U.S.-China currency agreement being floated as a symbol of progress in this week’s trade talks between the world’s two largest economies would largely repeat past pledges by China, currency experts say, and will not change the dollar-yuan relationship that has been a thorn in the side of President Donald Trump.
/reut.rs/2Vykl1E

Regulation

TP ICAP pays £15m to settle FCA charges over ‘wash trades’; Regulator said certain former managers had failed to act appropriately over the activity
Philip Stafford – FT
UK markets regulators have hit TP ICAP with a £15.4m penalty to settle charges the interdealer broker had ineffective controls over the conduct of its brokers and failed to be open and co-operative with a regulatory investigation.
/on.ft.com/2OG7Y2i

TP Icap pays £15m to settle long-running FCA investigation; Financial regulator says ‘lavish entertainment and a lack of effective controls’ led to improper trading
Chris Newlands – Financial News
Interdealer broker TP Icap has been fined £15.4m for lax controls that enabled “improper trading” at the old Tullett Prebon business in the years after the financial crisis.
bit.ly/2oxDG7d

ASIC urges consumers to question whether SMSFs are right for them
ASIC
ASIC has warned Australian investors considering establishing their own self-managed superannuation fund (SMSF) to be particularly aware of the potential downside to such a strategy, and that many Australians set up SMSFs that are inappropriate for their circumstances.
bit.ly/2MvptQd

Chairman Tarbert Announces New LabCFTC Director
CFTC (press release)
U.S. Commodity Futures Trading Commission Chairman Heath P. Tarbert today announced the following staff appointment: Melissa Netram, to serve as Director of LabCFTC. In her role, Ms. Netram will be responsible for coordinating closely with international and U.S. regulators and Capitol Hill to facilitate market-enhancing innovation, inform public policy, and ensure the CFTC has the understanding to keep pace with the ever changing financial services industry.
bit.ly/328iq6H

SGX reports market statistics for September 2019
SGX
Risk-management demand drives strong July-September quarter for commodities, FX; Singapore securities market turnover increases year-on-year
Singapore Exchange (SGX) today released its market statistics for September 2019. International investors were able to manage risk across multiple Asia-centric asset classes on the exchange, driving strong year-on-year (y-o-y) futures volume growth in iron ore, renminbi as well as Emerging Asia equities. Singapore securities market turnover increased amid mixed returns across Asian equity markets.
bit.ly/2MACl7J

Building better bridges: a world-leading investment industry around outcomes customers need
UK FCA
Speech by Charles Randell, Chair of the FCA, delivered at the the Investment Association annual dinner, Mansion House.
bit.ly/2M5dTfu

FCA sets out latest expectations for firms on Brexit
UK FCA
The FCA and regulated firms have been taking steps to prepare in the event the UK leaves the EU on 31 October 2019 without a deal. Today the FCA has issued an update on steps certain firms need to take.
bit.ly/2M82Xhg

FCA chair praises Jack Bogle in address on future of funds industry; Top UK regulator calls for ‘innovation in the interests of consumers’ and cites Vanguard founder as prime example
Mark Cobley – Financial News
Charles Randell, the chair of the Financial Conduct Authority, heaped praise on the late index-funds king Jack Bogle in his address to UK fund managers’ annual gathering. He also warned that the UK financial regulator is considering further steps on fund fees and value for money.
bit.ly/329P2Ns

Investing and Trading

Beware of paying too steep a price for high-quality assets; The run into ‘safe’ instruments is starting to look like a stampede
Robin Wigglesworth – FT
“There are no bad assets, only bad prices” is an adage on Wall Street. It is something that investors herding into supposedly safe, stable corners of financial markets should bear in mind.
/on.ft.com/2oxs0Br

Investors shift money out of stocks and into safer bonds; Funds focused on buying US shares suffer third straight week of withdrawals
Joe Rennison – FT
Investors pulled cash from stocks and risky corporate debt over the past week, funnelling it into the perceived safety of higher quality bonds, as tit-for-tat trade negotiations damaged sentiment and whipsawed asset prices.
/on.ft.com/2IIbLZ9

Institutions

UBS Prime Brokerage Executive Chris Hagstrom to Leave Bank; Departure comes after 15 years amid revamping of bank’s equities and fixed-income divisions
Juliet Chung – WSJ
Senior UBS UBS 1.89% Group AG executive Chris Hagstrom will leave the bank amid a restructuring of the equities and fixed-income divisions, people familiar with the matter said.
/on.wsj.com/2nGuahM

Mutual Funds’ Embrace of High-Profile Unicorns Backfires; Looking to beat benchmarks, funds expanded their holdings of private tech startups only to mark down values after disappointing IPOs
Jean Eaglesham and Coulter Jones – WSJ
Mutual funds that invested billions in big technology startups are now suffering losses in newly public companies and are being forced to mark down their holdings of private companies that are no longer investor darlings.
/on.wsj.com/2nGu5uu

Hargreaves Lansdown grilled over Woodford debacle; Fund supermarket faces investor criticism despite winning 35,000 new clients in last quarter
Philip Georgiadis in London and Archie Hall – FT
Hargreaves Lansdown came under fire from small investors over its links to embattled stock picker Neil Woodford despite reporting a rise in new clients in the third quarter and assets under administration of more than £100bn.
/on.ft.com/2OOa1Sb

Loyalty of Woodford investors to Hargreaves will soon be tested; Like ‘Stockholm syndrome’, it is sometimes hard to understand investors’ allegiance
Matthew Vincent – FT
“Stockholm syndrome” is an irrational loyalty that captives can feel towards captors — first diagnosed in four bank customers held hostage by Jan-Erik Olsson. “Bristol syndrome” appears to be something similar — but affecting 291,520 investors who have holdings trapped in Hargreaves Lansdown.
/on.ft.com/2IGDIAB

They Say He Lost $320 Million on Bad Oil Trades. He Says Documents Show Otherwise
Alfred Cang – Bloomberg
Lawyer says records show Wang couldn’t have manipulated data; Mitsubishi says Singapore unit lost $320 million in oil trades
The Chinese oil trader fired by Mitsubishi Corp. for allegedly losing $320 million in unauthorized trading said company documents that detail how the transactions were authorized would show that he is innocent.
/bloom.bg/2oyo4jU

Mutual Funds’ Embrace of High-Profile Unicorns Backfires; Looking to beat benchmarks, funds expanded their holdings of private tech startups only to mark down values after disappointing IPOs
Jean Eaglesham and Coulter Jones – WSJ
Mutual funds that invested billions in big technology startups are now suffering losses in newly public companies and are being forced to mark down their holdings of private companies that are no longer investor darlings.
/on.wsj.com/2nGu5uu

Regions

Rich Russians Buy Up U.S. Treasuries That Kremlin Doesn’t Like
Alexander Sazonov and Anna Baraulina – Bloomberg
Citibank says its wealthy clients have been buying U.S. debt; Russian central bank sold more than $100 billion of Treasuries
Russian President Vladimir Putin’s moves to ditch dollar assets in the face of deepening tensions with the U.S. don’t seem to be making much of an impression on the nation’s rich. While the Russian central bank has cut its Treasury holdings to a 12-year low since 2018, Citigroup Inc.’s wealthy clients in Moscow have been shifting money into U.S. debt.
/bloom.bg/2MJWZm3

U.K. Regulator Tells Companies to Improve Financial Disclosures
Nina Trentmann – The Wall Street Journal
British companies need to improve the quality of financial disclosures in their annual reports following the introduction of two new accounting standards, the U.K. Financial Reporting Council said in a review released Thursday. The country’s regulator for accounting and auditing reviewed the annual reports of 65 British companies and analyzed the application of new rules governing the accounting of revenue recognition and financial instruments as well as of an existing rule on the impairment of nonfinancial assets.
/on.wsj.com/2IGEQnO

China’s Hidden Capital Flight Surges to Record High
Bloomberg News
China’s hidden capital flight surged to a record high in the first half of this year, suggesting that residents wanting to move money abroad are using unrecorded transactions to evade tight capital controls. That’s according to the Washington-based Institute of International Finance, which said the “net errors & omissions” in China’s balance of payments, widely seen as an indicator of concealed capital flight, rose to a record high of $131 billion in the first six months of this year.
/bloom.bg/2p8sazh

Hong Kong protesters stage peaceful rallies calling for ‘liberation’
Jessie Pang – Reuters
Hundreds of black clad pro-democracy demonstrators chanted “Liberate Hong Kong, revolution of our times” outside the High Court on Wednesday as a leading activist appeared to appeal a six-year jail sentence for rioting in 2016. The court’s walls were scrawled with graffiti reading: “History will absolve us”, “If we burn you burn with us” and “No turn back 4HK”. The Chinese-ruled financial hub is struggling to recover from a weekend of violent clashes between police and tens of thousands of protesters, with parts virtually cut off due to a paralyzed metro that was a target of vandalism amid four months of often violent unrest.
/reut.rs/33m9L0r

Brexit

No-Deal Brexit Would Cost Ireland 73,000 Jobs, Central Bank Says
Dara Doyle
Unemployment rate will rise to almost 7% in no-deal scenario; Brexit talks deadlocked over keeping Irish border invisible
A no-deal Brexit would cost Ireland more than 73,000 jobs over the next two years, the nation’s central bank said.
/bloom.bg/2B1zEGG

Brexit: EU and UK agree to ‘intensify’ talks
BBC News
EU countries have agreed to “intensify” Brexit talks with the UK over the next few days. The development comes after a meeting in Brussels between Brexit Secretary Steve Barclay and EU chief negotiator Michel Barnier, described by both sides as “constructive”. The UK is due to leave the EU at 23:00 GMT on 31 October. A European leaders’ summit next week is seen as the last chance to agree a deal before that deadline.
/bbc.in/317juq2

EU27 gives green light for Brexit talks to move to key ‘tunnel’ phase
Daniel Boffey – The Guardian
Michel Barnier, the EU’s chief Brexit negotiator, has secured the agreement of the EU27 to open intensive “tunnel” negotiations on Boris Johnson’s latest proposals in a major boost for the British government. Sources said ambassadors representing the EU member states had given the “green light” to accelerated negotiations, in the hope of agreeing terms by next Thursday’s summit.
bit.ly/2OF62aq

Pound Has Best Two Days in a Decade on Brexit Progress
John Ainger – Bloomberg
A palpable feeling of optimism over a potential Brexit deal rippled through markets after U.K. Prime Minister Boris Johnson met Irish premier Leo Varadkar. And Deutsche Bank AG is one of those convinced it’s now time to buy sterling.
/bloom.bg/2q0hFOI

Miscellaneous

Fisher Apologizes for Remarks, Is Barred From Tiburon Events
Sabrina Willmer and Gwen Everett – Bloomberg
This language has no place in our company or industry, he says; Fisher earlier expressed surprise at reaction to comments
Two days after billionaire Ken Fisher made a series of offensive comments at an event that were condemned by attendees, he now says he’s really sorry.
/bloom.bg/2IGMXk2

Typhoon forces two Rugby World Cup matches to be cancelled;Storm with winds of 270km per hour bears down on Japan
Alice Woodhouse and Robin Harding – FT
Two Rugby World Cup matches have been cancelled this weekend as Typhoon Hagibis bears down on Japan, threatening strong winds and torrential rain.
/on.ft.com/2VCFvvU

John Lothian Newsletter

So you want to know what’s happening in the financial markets?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 Newsletters

Asset allocation specialists are the new snake oil salesmen

Asset allocation specialists are the new snake oil salesmen

First Read Back in Court with Bcause - Year End Report Thom Thompson - John Lothian News Wednesday was the last hearing scheduled for this year for the Bcause bankruptcy. The next court date is January 7 when the bankruptcy trustee's...

Pin It on Pinterest

Share This