U.S. Covid Failure Is Getting Harder for Markets to Ignore

Jun 29, 2020

First Read

Hits & Takes
By JLN Staff

There was a foiled attack on Pakistan’s stock exchange today that left four gunmen dead. According to a report in Fortune, “Pakistani security officials killed four gunmen in Karachi before they could enter the stock exchange building with automatic rifles and hand grenades. The attackers were not able to enter the main compound, Farrukh Khan, chief executive officer of the exchange said by phone.”

FTSE Russell and Nasdaq had their 17th consecutive closing cross on Nasdaq, which set a record for the number of shares traded during the 2020 Russell US indexes reconstitution.

If the reports in the New York Times are correct about President Trump being briefed about bounties paid by Russia for the Taliban to kill American and allied troops in Afghanistan, I believe he will be forced by Republicans to resign.

Last week, JLN produced more stories in a single week than I can remember. The reason was IDX-V being virtual and the team being able to cover the conference comprehensively. Thus, there is a good side to the virtual conference, as more people could access it remotely or read the coverage of it.

I am not sure how, but TABB Forum has been turned back on.~JJL

Do you have the new Eurex app yet?

After 16 years at the company, Jonathan Fieldman has left Broadway Technology.

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

+++++

FIA will host a webinar on Cross Border Clearing and Market Access: EMIR 2.2 and Brexit on Wednesday, July 8 from?9:15 AM – 10:30 AM BST. Speakers from the European Commission and the industry will share their views on the upcoming equivalence approach, the potential impact of market fragmentation on global markets, and implications for the continued growth of derivatives clearing in Europe. Go here for more information and to register. ~SR

The 2019 OCC Annual Report website is live.~JB

+++++

How Nasdaq’s CEO Led the Exchange’s Seamless Transition to Remote Working
Carleton English – Barron’s
For Nasdaq, “work from home” took on a meaning this year entirely different from simply firing up a laptop with a strong Wi-Fi connection. The setup was much more elaborate for the electronic stock exchange, which powers 120 markets around the world.
/bit.ly/3fZlGI2

*****The way the exchanges have handled this transition to work from home has been nothing short of amazing.~JJL

AFX CEO Sandor on Supporting Minority-Owned Community Banks
Bloomberg TV
Richard Sandor, chairman and chief executive officer of the American Financial Exchange (AFX), discusses how community banks are helping small business during the Covid-19 pandemic. He speaks with Bloomberg’s Romaine Bostick, Taylor Riggs and Caroline Hyde on “Bloomberg Markets: What’d You Miss?” (Source: Bloomberg)
/bloom.bg/2YJiL04

*****Richard Sandor is a man on a mission and nothing stops him.~JJL

Director Diversity, Inclusion & Employee Experience; Location: Chicago, IL, United States
CME Group
CME Group is the world’s leading and most diverse derivatives marketplace. But who we are goes deeper than that. Here, you can impact markets worldwide. Transform industries. And build a career shaping tomorrow. We invest in your success and you own it, all while working alongside a team of leading experts who inspire you in ways big and small. Joining our company gives you the opportunity to make a difference in global financial markets every day, whether you work on our industry-leading technology and risk management services, our benchmark products or in a corporate services area that helps us serve our customers better. We’re small enough for you and your contributions to be known. But big enough for your ideas to make an impact. The pace is dynamic, the work is unlike any other firm in the business, and the possibilities are endless. Problem solvers, difference makers, trailblazers. Those are our people. And we’re looking for more.
/bit.ly/2ZiOAfw

*****Here is your chance to change the world from inside the CME Group.~JJL

Here’s how to stop the virus from winning; Case surges, overrun hospitals, and a second lockdown this summer could deal a heavy blow to the United States. Here’s what we need to turn the tide.
Nsikan Akpan – National Geographic
HUMANS CAN BEAT COVID-19 because viruses are simplistic. They can’t move anywhere without assistance. Leave them outside in the open air for very long, and many will disintegrate. All they know is how to multiply. The problem, of course, is that the coronavirus is adept at this singular task, and as countries such as the United States have tried to loosen lockdowns and other restrictions, they’ve been jarred by the pandemic’s latest swells.
/on.natgeo.com/2Bk5Tot

*****Well worth the read. A good deep dive.~JJL

How a gamer caused a trillion-dollar stock market crash
Reed Tucker – NY Post
Navinder Sarao didn’t seem like the international criminal mastermind type. He lived with his parents, wore a choppy bowl cut and, instead of three-piece suits, he favored laddish track pants. He pedaled a bike around his suburban London neighborhood and would show up to important meetings munching on a McDonald’s Filet-O-Fish.
/bit.ly/31t0iXp

*****He did not cause it. Period. Stop writing this trash.~JJL

Friday’s Top Three
Our top story Friday was a Bloomberg opinion piece, The Coronavirus Trade-Off Was Always an Illusion. Second was the FIA article CFTC withdraws Reg AT, advances supplemental electronic trading proposal. Third was JLN’s FIA IDX-V: Global Economy Far From Equilibrium, CME Economist Says.

MarketsWiki Stats
180,322,893 pages viewed; 24,187 pages; 224,745 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
Telegram
Chainlink (LINK)
BitLicense
Christopher K. Hehmeyer

CryptoMarketsWiki Stats

1,404 pages; 12,435 edits
CryptoMarketsWiki Statistics

Lead Stories

U.S. Covid Failure Is Getting Harder for Markets to Ignore; Despite gobs of central bank money being deployed, health dangers remain and the risks for markets appear to be to the downside.
John Authers – Bloomberg
The year is still not half over. The history of Covid-19, and how it should best be combated, will not be written for a long while yet. So far, 2020 has already seen prognostications that the pandemic could mean the end of Xi Jinping and the communist regime in China, and that socialized or nationalized health care had been shown to fail definitively during the disaster that afflicted northern Italy in the late winter.
/bloom.bg/3g9oSke

SGX to fully acquire BidFX, advancing its global ambitions to offer end-to-end FX platform and solutions
SGX
Acquisition will accelerate momentum to establish SGX as a one-stop venue for international FX OTC and futures participants; Continued revenue growth in BidFX driven by record trading volumes and onboarding of new clients
Singapore Exchange (SGX), Asia’s most international multi-asset exchange and largest FX derivatives marketplace, today announced that it would acquire the remaining 80%[1] stake in BidFX from its other shareholder(s) for a cash consideration[2] of approximately US$128 million – a move that would expand SGX’s reach beyond FX futures into the global FX over-the-counter (OTC) market.
/bit.ly/3dH90Uz

As Covid-19 Cases Rise, America Still Doesn’t Get It; Most of the rest of the world is making progress against the coronavirus. Why not the U.S.?
Brooke Sample – Bloomberg
When it comes to coping with the Covid-19 crisis, America has been anything but exceptional. Europe’s patience ahead of cautious reopenings has been rewarded with a steep drop in cases; a recent outbreak in Beijing was met with swift lockdowns and mass testing. New Zealanders have largely returned to their pre-coronavirus routines thanks to strict and early border closures and orders to stay home. In the U.S., however, the curve remains far from flat, with record spikes in cases now appearing in Florida, Arizona, Texas and other states.
/bloom.bg/3g9KYDu

The Stock Market Feeds the Racial Inequality It’s Free to Ignore
Max Reyes – Bloomberg
Unequal equity ownership seen widening racial wealth gaps; Fed data shows 61% of White families own stock, 31% of Black
Over the past few weeks, as outraged crowds marched through the streets of America to demand an end to systemic racism, the country’s stock investors were busy bidding up the market at a dizzying clip. At its height, with curfews enacted and videos of protesters clashing with police all over social media and President Donald Trump threatening to send in troops, the froth in markets became so extreme that, when observed on a three-month basis, every single company in the S&P 500 had swung into positive territory. It was a breathtaking display of indiscriminate buoyancy with no precedent in recent times.
/bloom.bg/2BOOa8F

Trump’s Inaction Makes Oil Market Management Harder; Whatever happens with the pandemic, an oil output deal that doesn’t include the world’s biggest producer makes it even harder to do.
Julian Lee – Bloomberg
The unprecedented OPEC+ deal in April, which led to drastic output cuts, is now entering its most dangerous phase, with oil demand and prices recovering. At the time, President Donald Trump claimed credit for the breakthrough, even though the U.S., the world’s biggest oil producer, wasn’t part of the agreement. Now the American president could play a pivotal role in its fate, not by calling the leaders of Saudi Arabia and Russia, but by acting decisively — or failing to act — to contain a resurgence of the Covid-19 outbreak in the U.S.
/bloom.bg/2ZhSXY5

Buyer Beware: Oil Stockpiles Are Enormous; Enough oil has gone into storage to drive every U.S. truck around the world five times.
Julian Lee – Bloomberg
Remember negative oil prices and the fear that every storage tank on the planet would get filled to the brim? That seems a long time ago, with West Texas Intermediate crude now hitting $40 a barrel and the buildup of stockpiles poised to go into reverse. The warning sent by that trip below zero was heeded. Oil production was slashed and the crisis averted.
/bloom.bg/2YFlKqt

The Future of Europe Could Be Decided in Poland; The first round of the Polish presidential election may have signaled a welcome change in direction for the country and continent.
Andreas Kluth – Bloomberg
The European Union has many problems, but the most fundamental may be the rift between northern and southern member states and the even deeper fault line running between west and east. That latter fissure is especially dangerous because, unlike the largely economic one between north and south, it tears at the EU’s core values, including democracy, freedom of the press and the rule of law.
/bloom.bg/31qmJg0

Legal teams discover their inner geek; Lawyers who merge business, law and technology are redefining corporate legal departments. Plus: five general counsel who stand out for developing new products
Reena SenGupta – The Financial Times
In-house legal teams often find themselves cast in the role of unhelpful naysayers, out of line with the company’s strategy and its approach to risk. The “department of progress prevention”, is how one chief executive puts it. As it happens, that business leader salutes their company’s general counsel, but speaks for many other executives who assume the legal team’s starting point is to put on the brakes.
/bit.ly/2VuHun4

***SR: Mentions John Zecca, general counsel at Nasdaq, and Katherine Tew Darras, general counsel at ISDA.

What Racial Inequality Means When You Go to the Bank
Lananh Nguyen and Hannah Levitt – Bloomberg
Protests over racial injustice that started over police brutality are now raising questions for American banks. Critics say Wall Street has contributed to stark racial gaps in income and wealth. They argue lenders have long withheld credit from African-American businesses and homeowners and charged them higher rates. There’s even a hashtag, #BankingWhileBlack, for sharing experiences of racial profiling in bank branches. And African-American businesses were at a disadvantage this spring in getting federal emergency loans.
/bloom.bg/2Zl77I8

China Should Join Trade Deal the U.S. Abandoned; Chinese membership in the successor to the Trans-Pacific Partnership would help revive the post-pandemic global economy.
Wang Huiyao – Bloomberg
The Covid-19 pandemic is intensifying the most destructive trends in global trade. Support for free trade has given way to talk of decoupling and de-globalization. Tensions between the U.S. and China are rising, as are calls for protectionism and re-shoring of far-flung supply chains. It is no longer seen as desirable, or even possible, to integrate countries that possess different economic systems or ideologies.
/bloom.bg/31DP8j1

Stiglitz, Roubini and the Post-Pandemic Future of Capitalism; The two famous economists have very different takes on what comes next.
Stephanie Flanders and Lucy Meakin – Bloomberg
It’s no exaggeration to say the coronavirus has upended the global economy in ways few could have imagined. It’s been called a wake-up call for capitalism and a foreshadowing of our exceedingly precarious future, one with more catastrophes waiting in the wings. What if anything can governments and central banks do about it?
/bloom.bg/2YHXXX9

Companies Need to Share More of Their Riches With Workers; Want a fairer system? Have compensation committees broaden their mandate beyond executive pay.
Leo E. Strine Jr. and Kirby M Smith – Bloomberg
For two generations, workers’ wages have stagnated. During this period, powerful institutional investors have tied executive pay to stock performance and created a corporate-governance system solely focused on delivering for stockholders. The bulk of the rewards for improved corporate performance shifted to stockholders and top management, at the expense of other company stakeholders, particularly employees. The result has been soaring inequality, increased economic insecurity and a growing anxiety that our capitalist system is stacked against working people.
/bloom.bg/31rb1BR

The Inequality of Summer Leisure; This season of social distancing will also be one of social closeness between neighbors—illuminating divides of race, class, and place.
The Atlantic
Here’s a helpful phrase from history: “emergencies of over-patriotism.” That’s from the New-York Tribune in 1909, from one of the many newspaper accounts from the turn of the century lamenting the DIY fireworks launched by the masses every Independence Day. American industrialization and immigration had created an urban working class in need of ways to blow off steam, and pyrotechnics provided an outlet—at the cost of hundreds of lives accidentally lost every summer.
/bit.ly/2VsTLYW

Work-Life Conflict Can’t Be Solved—and That’s a Good Thing; Instead of trying to get the balance between career and family right once and for all, parents should recognize the benefits of playing multiple roles.
Yael Chatav Schonbrun and Elizabeth Corey – WSJ
The life of a working parent has always been relentlessly demanding, but during the Covid-19 pandemic it has morphed into a rigged game of whack-a-mole. Attending to a child’s education means neglecting a meeting. Focusing on a work assignment means leaving children to their own mischievous devices—or, in the case of toddlers, to interrupt you every 30 seconds. Giving children early bedtimes so you can get some rest means they will wake up extra early the next morning to start the whole cycle again.
/on.wsj.com/3ibVP1s

Entrepreneurs experience constant worry and sleepless nights, especially in the early stages of a venture when there’s uncertainty and lack of customers
DNYUZ.xom
Entrepreneurs experience constant worry and sleepless nights, especially in the early stages of a venture when there’s uncertainty and lack of customers. Today’s pandemic recession doesn’t help much, either. Business owners who have been impacted by the economic downturn often must choose between never giving up or closing shop and cutting losses.
/bit.ly/31rEFqL

Chinese tourists will likely be allowed back into the EU, while US are left out
Stacey Lastoe, CNN
In downtown Buffalo, New York, crossing the border into Ontario, Canada, used to be as easy as driving one mile across the Peace Bridge over the Niagara River. But that’s now a forbidden route. In the coronavirus era, New York residents and out-of-state road trippers aren’t allowed to cross the border for leisure travel.
/cnn.it/3i6KWxX

China’s Financial System Is Running Out of Room
Anjani Trivedi – Bloomberg
Despite deleveraging rhetoric, risks lurking in China’s financial system are coming to the fore and starting to hurt a highly sensitive group: repressed savers. Eroding investor confidence and blockages in the allocation of money could become far more dangerous than previously. Beijing has few options but to backpedal on rules meant to clamp down on the unruly underbelly of its banking system.
/yhoo.it/2BNOvZe

A Harvard student’s brainchild creates a pipeline for Black finance hopefuls
Kristin Myers – Yahoo Finance
According to a recent study by recruitment firm Vettery, less than 10% of Wall Street is Black or Hispanic. It’s a statistic that Angel Onuoha is trying to change through his fund BLK Capital Management.
/yhoo.it/2NBunMB

Accenture is laying people off as Wall Street braces for big cuts next year
Meredith Mazzilli – Business Insider
Welcome to Wall Street Insider, where we take you behind the scenes of the finance team’s biggest scoops and deep dives from the past week.
/yhoo.it/2YJnteg

Coronavirus

Coronavirus: From my view in Hong Kong, American reluctance to wear a mask is suicidal
Scott Duke Harris. – USA TODAY
To mask or not to mask … That’s still the question? Seriously? It shouldn’t be, not when a lethal virus might be a sneeze, a cough or simply a breath away. Not when the pandemic has killed nearly a half-million people worldwide, including more than 125,000 in the United States — and several states are spiking.
/yhoo.it/2VsYVEi

Americans confront ‘very scary’ next phase of coronavirus pandemic as new infections spike across the South
Suzanne Smalley – Yahoo News
Calling the recent surge in coronavirus cases in states like Florida, Texas and Arizona “very scary,” Yahoo News Medical Contributor Dr. Kavita Patel said she fears the virus will continue to flare up in communities around the country throughout the summer.
/yhoo.it/3dP67RS

Sweden’s Covid Expert Says the World Still Doesn’t Understand;Sign up here for our daily coronavirus newsletter on what you need to know, and subscribe to our Covid-19 podcast for the latest news and analysis.
Love Liman, Niclas Rolander – Bloomberg
After three months of non-stop controversy, Sweden’s top epidemiologist is about to go on vacation. Anders Tegnell is unlikely to stray far from home, after much of the European Union excluded Sweden from safe travel lists. His decision to advise against a Swedish lockdown has coincided with one of the world’s highest Covid-19 mortality rates. But Tegnell insists Sweden’s strategy remains widely misunderstood.
/bloom.bg/2ZmHEhc

A Horrifying U.S. Covid Curve Has a Simple Explanation; A growing gap in case growth between Europe and the U.S. tells the tale: Declaring victory too soon is an excellent way to return to new heights.
Max Nisen – Bloomberg
The alarming chart below has been making the rounds. It illustrates the poor job the U.S. has done in containing Covid-19 compared to the European Union, a bigger region of independent countries that suffered an earlier outbreak. Why the big difference? What is America doing wrong?
/bloom.bg/2Zct2ks

As Coronavirus Cases Spike, Many GOP Lawmakers Back Masks and Tests; The new emphasis comes as the pandemic shifts to southern and western states
Kristina Peterson and Andrew Duehren – WSJ
Many congressional Republicans are throwing their support behind the use of masks and robust testing as coronavirus cases spike in some GOP-led states, taking a more urgent stance on the matter than President Trump.
/on.wsj.com/2VsWykS

How the World Missed Covid-19’s Silents Spread; Symptomless transmission makes the coronavirus far harder to fight. But health officials dismissed the risk for months, pushing misleading and contradictory claims in the face of mounting evidence.
Matt Apuzzo, Selam Gebrekidan and David D. Kirkpatrick – NY Times
Dr. Camilla Rothe was about to leave for dinner when the government laboratory called with the surprising test result. Positive. It was Jan. 27. She had just discovered Germany’s first case of the new coronavirus.
/nyti.ms/31qohqk

Rising Coronavirus Cases Put Fresh Strain on Mask Supplies; Hospitals, nursing homes face new challenges finding enough N95s for front-line workers
Austen Hufford and Melanie Evans – WSJ
The renewed surge in coronavirus cases across much of the U.S. is undermining efforts hospitals and manufacturers made in recent months to provide enough N95 masks to front-line workers.
/on.wsj.com/2VsF1tj

Why Americans Are Having an Emotional Reaction to Masks; Face coverings can change the way we behave with each other.
Tyler Cowen – Bloomberg
While Americans still have not adopted mask-wearing as a general norm, we’re wearing masks more than ever before. Mask-wearing is mandated in California, and in many counties masks are near-universal in public spaces. So I have started wondering: Does wearing a mask change our social behavior and our emotional inclinations? And if mask-wearing does indeed change the fabric of our interactions, is that one reason why the masks are not more popular in the U.S.?
/bloom.bg/3i8WiBs

What a Century of Disease Outbreaks Can Teach Us About Covid-19
Paul Murray and John Lauerman – Bloomberg
Covid-19 has established itself as the deadliest, fastest-moving pandemic since 1918, and is nearing a half-million fatalities. During the century that separates the two outbreaks, the world battled a string of other devastating diseases including Ebola, SARS and several other flu pandemics.
/bloom.bg/31scfg0

Roche Says Demand for Covid-19 Tests Exceeds Production
Marion Halftermeyer – Bloomberg
Areas with high infection rates top priority for test delivery; Roche is also ramping up production of antibody tests
Roche Holding AG’s production of coronavirus tests is falling behind in meeting the outsize global demand for them. “The PCR tests that detect acute Covid infection, the demand exceeds our production,” Roche Chairman Christoph Franz said in an interview with Swiss daily newspaper Tages Anzeiger.
/bloom.bg/2Zq8cP0

Second-Generation Covid Vaccines Are Built for Impact Over Speed
James Paton – Bloomberg
First inoculation to battle Covid may not be most widely used; ‘Is it the tortoise or the hare?’ vaccine expert says
Speed isn’t the only thing that matters in the quest for a vaccine to end the Covid-19 pandemic. They may not cross the finish line first, but dozens of companies and universities still see an opening for inoculations that prevent more infections, provide lasting immunity, protect older and more vulnerable people, yield massive quantities or ship easily throughout the world. Those are benefits the front-runners may not be able to deliver.
/bloom.bg/2ZdPuda

12 states are pausing reopening over the surge in US coronavirus cases
Nicole Chavez and Madeline Holcombe – CNN
Washington is the latest state to pause its reopening plans after a spike in the number of new cases of coronavirus across the country. “We all want to get back to doing all the things we love in Washington during the summer, and fully open our economy, but we aren’t there yet,” Gov. Jay Inslee said Saturday. “This is an evolving situation and we will continue to make decisions based on the data.”
/cnn.it/2BaWxeQ

Reporter Who Covered President Trump’s Tulsa Rally Says He Tested Positive for COVID-19
Madeleine Carlisle – Time
A reporter in Oklahoma who covered President Donald Trump’s June 20 rally in Tulsa, Okla., says he has tested positive for COVID-19.
/bit.ly/3gdbVGl

Fauci says Covid-19 vaccine may not get US to herd immunity if too many people refuse to get it
Elizabeth Cohen – CNN
Dr. Anthony Fauci says he would “settle” for a Covid-19 vaccine that’s 70% to 75% effective, but that this incomplete protection, coupled with the fact that many Americans say they won’t get a coronavirus vaccine, makes it “unlikely” that the US will achieve sufficient levels of immunity to quell the outbreak.
/cnn.it/2Zkmm3V

The data is in: Fox News may have kept millions from taking the coronavirus threat seriously
Margaret Sullivan – Washington Post
It’s another one of those Trump Era realities best described as unsurprising but nevertheless shocking. Three serious research efforts have put numerical weight — yes, data-driven evidence — behind what many suspected all along: Americans who relied on Fox News, or similar right-wing sources, were duped as the coronavirus began its deadly spread.
/wapo.st/3g6dWE7

Exchanges, OTC and Clearing

Nasdaq’s New Platform Backed By R3, Digital Asset, Symbiont And Microsoft May Not Be What You Think It Is
Ben Jessel – Forbes
A view of Nasdaq in Times Square (Photo by Noam Galai/Getty Images) GETTY IMAGES
Last week, the exchange giant Nasdaq announced the launch of its SaaS based digital asset suite named the Marketplace Services platform.
/bit.ly/2VsVjSK

DGCX in Discussions with Trading Community on Potential Listing of Black Pepper Futures Contract
Press Release via Mondovisione
The Dubai Gold and Commodities Exchange (DGCX) today announced that it is in talks with its members and the wider trading community on the potential listing of a Black Pepper Futures contract. The discussions were initiated following a virtual meeting between Ahmed Bin Sulayem, Chairman of DGCX, and Ahmad Sultan Bin Harib Alfalahi, the UAE’s Commercial Attaché to India, to strengthen the bilateral relations between the UAE and India, and the major role that DMCC plays in the trade relationship.
/bit.ly/3dKomHO

Credit Suisse Joins ICE ETF Hub As An Authorized Participant; Becomes Member of the Advisory Committee
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, today announced that Credit Suisse has joined the ICE ETF Hub as an authorized participant and has become a member of the advisory committee for the platform.
/bit.ly/2NAHXj8

17th Consecutive Nasdaq Closing Cross Sets Record for Number of Shares Traded During 2020 Russell US Indexes Reconstitution
NASDAQ
Nasdaq (Symbol: NDAQ) today announced the Nasdaq Closing Cross had a record day as it was used for the 17th consecutive year to rebalance Nasdaq-listed securities in the entire family of Russell U.S. Indexes, part of leading global index provider FTSE Russell, during their annual reconstitution.
/bit.ly/3eUJpsw

A foiled attack on Pakistan’s stock exchange leaves four gunmen dead
Faseeh Mangi and Bloomberg – Fortune
Pakistani security officials killed four gunmen in Karachi before they could enter the stock exchange building with automatic rifles and hand grenades. The attackers were not able to enter the main compound, Farrukh Khan, chief executive officer of the exchange said by phone. The situation is under control now, said Khan. The KSE 100 index, which dropped after news of the attack, gained 0.4% at 12:59 p.m. in Karachi.
/bit.ly/2YMujjz

Fintech

Wirecard Scandal Puts Spotlight on Auditor Ernst & Young; Emails show auditor had questions related to unorthodox financial arrangements in 2016
Wirecard and the Curious Case of the Missing $2 Billion
Patricia Kowsmann, Paul J. Davies and Juliet Chung – WSJ
Ernst & Young GmbH, auditor to insolvent German fintech company Wirecard AG WDI 166.94%, had questions related to unorthodox arrangements under which the company’s cash was held in bank accounts it didn’t control as far back as 2016, according to emails seen by The Wall Street Journal.
/on.wsj.com/2Zm9Als

OpenDoor Launches Trading Venue for On the Run Treasuries
MarketsMedia
OpenDoor Launches Anonymous Trading Venue for On the Run U.S. Treasuries
OpenDoor Securities LLC (“OpenDoor”) has launched the first ‘all-to-all’ marketplace for on-the-run (“OTR”) U.S. Treasuries. The anonymous order book will be the first U.S. Treasury venue to offer non-discriminatory pricing in benchmarks regardless of an account’s designation. The roll-out is in direct response to voiced concerns regarding the negative impact of information arbitrage as well as the dearth of liquidity experienced during times of stress on traditional trading venues.
/bit.ly/31sWndw

Wirecard’s collapse reveals cracks at the heart of Germany, Inc
Charles Riley, CNN Business
It’s been a spectacularly bad week for German business. One of the country’s biggest public companies was brought down by an accounting scandal, another was forced to pay out billions in damages, and poor working conditions at a leading family-owned meat packing firm were dragged into public view by a huge Covid-19 outbreak.
/cnn.it/3iffe1g

Bye Fintech. Hello Techfin.
David G.W. Birch – Forbes
There’s a very interesting discussion to be had (and I’m having it in a number of different contexts at the moment) about whether the changes induced by the COVID-19 crisis are short- or long-term and to what extent those changes are an acceleration of existing trends (as I think they are, largely) or new directions for the sector. My good friend Ron Shevlin wrote a superb article here in Forbes highlighting one element of strategic change, saying that “the new normal marks the end of fintech experimentation”. He goes on to point out, somewhat harshly, that banks have used fintech partnerships as a way of convincing themselves that they are innovating rather than actually doing anything transformational.
/bit.ly/2BkcWxp

UK fintech firms forced to suspend services after Wirecard collapse
Iain Withers, Anna Irrera – Reuters
Customers of several British digital finance companies were unable to make payments or access their money on Friday after the collapse of German payments firm Wirecard caused disruption across borders.
/reut.rs/3igFHfg

280 CapMarkets Launches Straight Through Processing & Additional Asset Classes on its BondNav® Platform
280 CapMarkets
280 CapMarkets (280), a fixed income technology company providing best execution trading support and price transparency to advisors, institutions and issuers, has announced the roll-out of straight-through processing (STP) capabilities, which accelerates and automates the processing of client transactions. The goal is for clients to manage their own trading allocations and seamlessly incorporate BondNav® into their existing operational workflows. In addition to Municipal and Corporate bonds that are currently offered on the platform, 280 announced the addition of Certificates of Deposits (CDs).
/prn.to/3gl6t4n

Cryptocurrencies

Money Reimagined: Crypto’s Diversity Problem
Michael J. Casey – Coindesk
A few years ago, when MIT Media Lab researcher Joy Buolamwini was leading an interactive digital art project, she found the facial recognition technology it employed was far better at recognizing her lighter-skinned MIT colleagues. The discovery sent Buolamwini on a mission. She founded the Algorithmic Justice League and started doing research that builds awareness about biases in software algorithms. One paper she co-authored with Timnit Gebru, the technical co-lead of the Ethical Artificial Intelligence Team at Google, found facial-analysis software had an error rate of 34.7% for dark-skinned women versus just 0.8% for light-skinned men. Facial recognition is the tip of the iceberg. Biases are inherently present in all forms of artificial intelligence algorithms, those digital machines that increasingly run our world.
/bit.ly/2YIFPw1

Silk Road founder Ross Ulbricht pens column on DeFi platform Maker and March debt crisis
Michael McSweeney – The Block
Ross Ulbricht, the Silk Road dark marketplace founder who is currently serving a double life sentence following a 2015 conviction, published an article on Friday about Maker, the Open Finance credit protocol. His comments centered around the problematic debt situation Maker encountered back in March, when a plunging ETH price left a significant number of loans below their collateralization threshold, as The Block previously reported. This resulted in a wave of liquidations and led to an auction of MKR governance tokens to cover the shortfall. MakerDAO’s problems resulted from the wider market event known as “Black Thursday.”
/bit.ly/3dCkfh6

OKEx Lists COMP Governance Token From DeFi’s Largest Platform Compound
PR Newswire (press release)
OKEx (www.okex.com), a world-leading cryptocurrency spot and derivatives exchange, announces its new listing of COMP, the native token of Compound, an algorithmic, autonomous interest-rate protocol on the Ethereum blockchain. COMP spot trading against USDT and BTC opened at 6:00 am (UTC) today, June 29. Depositing COMP is available as of 5:00 am (UTC) on June 29 and withdrawal as of 9:00 am (UTC).
/prn.to/3igVISq

Mapping the Future of the SEC (There’s a Nonzero Chance Hester Peirce Takes Over)
Nikhilesh De – Coindesk
The future of the U.S. federal securities regulator, and perhaps the direction of cryptocurrency policy, is up in the air. Last week, President Donald Trump announced his intention to nominate Securities and Exchange Commission Chairman Jay Clayton to the post of U.S. Attorney for the Southern District of New York, asking Congress to approve the one-time corporate lawyer to become one of the nation’s most powerful financial crimes prosecutors.
/bit.ly/2YJqKdL

Many Bitcoin Developers Are Choosing to Use Pseudonyms – For Good Reason
Alyssa Hertig – Coindesk
“Here lies the huge irony in this discussion. Persistent pseudonyms aren’t ways to hide who you are. They provide a way to be who you are. You can finally talk about what you really believe; your real politics, your real problems, your real sexuality, your real family, your real self.” — Engineer Kee Hinckley
/bit.ly/3ijFvfh

Vanguard’s Blockchain Platform for Foreign Exchange Will Go Live in Q3 2020
Nathan DiCamillo – Coindesk
Mutual fund giant Vanguard has completed another blockchain pilot that aims to change the risk profile of foreign exchange (FX) transactions. The Valley Forge, Pa.-based investment firm ran the pilot on Symbiont’s Assembly blockchain with participation from State Street, BNY Mellon and investment firm Franklin Templeton. Vanguard and Franklin Templeton acted as dealer banks and State Street and BNY Mellon acted as counterparty banks as well as custodians, said Symbiont’s foreign exchange lead, Joe Ziccarelli. Symbiont believes the foreign exchange platform will go into production in the third quarter of 2020, Ziccarelli said.
/bit.ly/3igW63k

The Devil’s in the Details of a New Cryptojacking Malware: Meet “Lucifer”
Rachel McIntosh – Finance Magnates
Palto Alto Networks’ Unit 42 has discovered a particularly powerful new kind of Monero-mining malware. A new kind of “hybrid crypto-jacking malware” has been discovered by Palo Alto Networks’ ‘Unit 42’ researchers, according to a report by HackRead. In a blog post detailing the findings, the researchers named the malware – which is also capable of launching DDoS attacks – “Lucifer.” The malware attacks vulnerable Windows hosts using a variety of “trivial-to-exploit nature” operating system flaws. Unit 42 has rated these flaws ‘critical’ or ‘high’.
/bit.ly/3dKfIZQ

World’s Biggest Mining Firm Makes First Ore Trade on a Blockchain
Sebastian Sinclair – Coindesk
Mining conglomerate BHP has completed its first trial trade of iron ore using blockchain technology. As reported by Reuters on Monday, the roughly $14 million deal with Chinese metals giant Baoshan Iron & Steel Co Ltd. (Baosteel) was conducted on a platform created by Canada-based startup MineHub Technologies. The MineHub platform was used to process contract terms, exchange documents online and provide visibility and accountability along the supply chain. The transaction took place in June. BHP Group is an Anglo-Australian mining, metals and petroleum multinational based in Melbourne, Australia, and is the biggest mining firm worldwide by market capitalization.
/bit.ly/3g83Brb

Balancer pools drained of more than $450,000 due to an exploit connected to deflationary tokens
Yogita Khatri – The Block
Two multi-token pools on Balancer, an automated market maker protocol, were drained of ~$450,000 on June 29 by an attacker that specifically targeted pools containing the so-called deflationary tokens. The hacker conducted the attack in two separate transactions?—?one took place at 6:03 pm and the second one 30 minutes later 06:49 pm. Only pools with STA and STONK, deflationary tokens with transfer fees, were affected by this exploit.
/bit.ly/31E0547

DeFi Platform Opyn Launches Put Options on Compound Token
Omkar Godbole – Coindesk
Decentralized finance (DeFi) protocol Compound saw its governance token, COMP, skyrocket in price when it launched last week. Now, decentralized options marketplace Opyn has launched put options on COMP that will provide a safety net of sorts by helping holders mitigate some of the risk should COMP’s fortunes take a turn for the worse in the next few days.
/bit.ly/2Bo42ii

Shares of bitcoin miner maker Ebang slide after trading begins on Nasdaq
Celia Wan – The Block
Shares of bitcoin mining hardware maker Ebang began trading today on Nasdaq with an underwhelming initial performance. As part of the initial public offering (IPO), the China-based company is offering 19.3 million shares priced at $5.23. During the initial 15 minutes of trading, the stock’s price continued to trend downwards and currently sit at around $4.12.
/bit.ly/2ZhhVHi

Politics

Trump, like Herbert Hoover, is ‘the man who doesn’t care.’ Biden can make that stick.
Matt Bennett and Josh Freed – USA Today
At a recent White House event, as small business owners poured out their anguish about the economic devastation of the coronavirus shutdown, President Donald Trump made his boredom plain. He scrolled through his phone and posted on Twitter about an unrelated controversy. Yet this was just a particularly obvious display of Trump’s lack of concern for the travails of his constituents. The president has shown almost no compassion for — or interest in — the over 125,000 American’s who have died from COVID-19 or the 21 million newly unemployed. And he all but ignored the pain and anger of millions protesting in nearly every American city against systemic racism and police violence.
/yhoo.it/2BOwpGm

Democrats Want to Block Stimulus for Companies Moving Offshore
Laura Davison – Bloomberg
Democrats’ bill being released Wednesday aimed at inversions; Lack of Republican sponsors makes it a long-shot for passage
Top Democrats in the House and Senate are backing a measure that would deny coronavirus aid to companies that moved their official headquarters offshore to avoid U.S. taxes. The legislation, scheduled to be released Wednesday, would block companies that engage in so-called corporate inversion transactions from participating in the Federal Reserve’s emergency lending programs. It would also block them from taking advantage of new tax breaks for business losses and interest payments.
/bloom.bg/3dHXDvy

Putin Seizes Moment to Rule Until He’s 83 Amid Fading Popularity
Henry Meyer and Ilya Arkhipov – Bloomberg
Russians vote in referendum that will erase Putin’s term limit; Kremlin woos angry voters with measures like gay-marriage ban
After two decades in power, Vladimir Putin’s approval ratings are at an all-time low as Russia’s economy reels under the impact of the coronavirus epidemic and the slump in oil prices. What better time for him to seek to extend his presidency for potentially 16 more years?
/bloom.bg/3gbs8vo

The US is more alone than ever, just at the moment the world needs its leadership
CNN
The United States is in uncharted territory, on an exponential path to becoming a Covid-19 pariah and an unreliable ally to its friends. America’s fall in global esteem is turning into an international horror show as the world watches the superpower struggle to match the efforts of many poorer nations to get the coronavirus pandemic under control.
/cnn.it/3g5yJYo

More Americans disapprove of Trump now than at any other time in his presidency
PBS.org
In recent days, President Donald Trump’s disapproval rating has risen higher than at any other point during his presidency, according to the latest PBS NewsHour/NPR/Marist poll.
/to.pbs.org/2ZqaQUW

Trump Says Report on Russian Afghanistan Bounties Isn’t Credible
Jennifer Epstein and Ben Brody – Bloomberg
Russia reportedly paid to target U.S. troops in Afghanistan; Biden criticized Trump, Russia’s Putin at campaign event
President Donald Trump said in a tweet that U.S. intelligence officials told him a report that the Russian government paid bounties for American and allied troops to be killed in Afghanistan wasn’t credible, and therefore didn’t brief him about it.
/bloom.bg/2ZisKsC

Lawmakers seek probe into claim Russia put bounty on US soldiers; US intelligence reportedly concluded that militants were offered money to kill Nato troops in Afghanistan
Katrina Manson – FT
US lawmakers have called for a congressional probe into claims the US failed to act on intelligence that Russian operatives offered to pay Taliban-linked militants to kill American troops in Afghanistan.
/on.ft.com/2NByDf1

Wall Street Quietly Begins Warning About A Biden Presidency
Sergei Klebnikov – Forbes
With Joe Biden surging in the polls, Wall Street executives are preparing for a potential scenario where he becomes president—with some firms warning clients the stock market could take a hit.
/bit.ly/3g5y8pC

Trump’s Lobster Stunt Won’t Even Help Him in Maine; Here are Bloomberg Opinion’s top stories this week.
Brooke Sample – Bloomberg
Sinking in the Polls, Trump Tweets About Lobsters — Jonathan Bernstein
Wednesday began with a New York Times poll that was pretty awful for President Donald Trump, and I was contemplating writing a complicated item about whether we should pay attention to such surveys at this point in the election cycle. But then the lobsters.
/bloom.bg/2CSqzV1

China Gambles on How Much Trump Has to Lose
Daniel Ten Kate – Bloomberg
As bad as U.S.-China ties look now, things could get even worse this week. China’s top legislative body is expected to pass a national security law for Hong Kong tomorrow that could include life sentences for anyone found guilty of offenses like secession and subversion. Beyond eroding key freedoms that underpin the city’s success as a financial hub, the move could unleash further tit-for-tat actions between Donald Trump and Xi Jinping.
/bloom.bg/2Vv2YjB

Regulation

FDIC Considers Scrapping Quarterly Bank Reports; Agency to kick off competition to develop new reporting prototype that provides timely data on bank risks
Andrew Ackerman – WSJ
The Federal Deposit Insurance Corp. is moving to boost the way it monitors for risks at thousands of U.S. banks, potentially scrapping quarterly reports that have been a fixture of oversight for more than 150 years yet often contain stale data.
/on.wsj.com/2NBl3rW

Big-Tech Investors Need to Start Watching Brussels More Closely; Proposals for new powers could arm enforcers to push through more fundamental changes to how the likes of Apple and Google operate in Europe
Rochelle Toplensky – WSJ
For all the noise they have generated, European Union efforts to regulate U.S. tech giants haven’t exactly kept investors awake at night. But that might be starting to change.
/on.wsj.com/38cRCWH

CFTC’s Civil Monetary Penalty Guidance: A Perspective from a Former CFTC Regulator
Covington
Futures and Derivatives; Commodity Futures Trading Commission (CFTC)
On May 20th the U.S. Commodities Futures Trading Commission (the “CFTC” or the
“Commission”) Division of Enforcement (the “Division”) announced new guidance for Division
staff to consider when recommending civil monetary penalties in an enforcement action (the
“CMP Guidance” or the “Guidance”).1 CFTC Enforcement Director Jamie McDonald explained
that the Guidance serves two purposes.
/bit.ly/31mB0dI

Germany to Give BaFin Power to Probe Financial Reports: FT
Sarah Jacob and Piotr Skolimowski – Bloomberg
Official says self-regulation by auditors doesn’t work; Government to end contract with accounting watchdog, Bild says
Germany will give the power to start investigations into company accounts to the nation’s financial regulator BaFin, the Financial Times reported, as the fallout from an accounting scandal at payments company Wirecard AG widens.
/bloom.bg/389EMsl

Germany to overhaul accounting regulation after Wirecard collapse; Watchdog’s powers to be transferred to BaFin as deputy finance minister calls for ‘radical solutions’
Olaf Storbeck and Guy Chazan – FT
Print this page
Germany is to overhaul the way it regulates accountancy firms as it seeks “radical solutions” to contain the fallout from the huge fraud at payments group Wirecard.
/on.ft.com/38fnda7

ASIC bans former Forex Capital Trading Pty Ltd employee from providing financial services
ASIC
ASIC has banned Mr Steven Marsh, a former employee of Forex Capital Trading Pty Ltd (Forex CT), from providing financial services for a period of three years.
/bit.ly/2NE9O1Z

Investing and Trading

Americans Will Soon Need Extra Money They Saved in Lockdown
Ben Steverman – Bloomberg
Even middle-class households are often short of liquid assets; Almost 40% say they’d struggle to cover surprise $400 expense
During the worst economic collapse in generations, U.S. households actually managed to put aside more money. It may not be enough to get them through the aftermath.
/bloom.bg/2YIRvPs

Chesapeake Pushed Into Bankruptcy by Plunging Energy Prices
David Wethe, Dawn McCarty, and Olivia Rockeman – Bloomberg
Fracker couldn’t escape crushing debt load, gas market slump; Enters into agreement to eliminate about $7 billion in debt
Chesapeake Energy Corp., the archetype for America’s extraordinary shale-gas fortunes, filed for bankruptcy, becoming one of the biggest victims of a spectacular collapse in energy demand from the virus-induced global lockdown.
/bloom.bg/3eJUcG6

The safe-asset shortage after Covid-19; Demand has outstripped supply since 2009 but the latest crisis may help to redress the balance
Gavyn Davies – FT
One of the long-term consequences of the 2008 financial crisis was a lack of safe assets that could be used by institutions to store their wealth, meet regulatory requirements and provide collateral to borrow additional funds.
/on.ft.com/2YFn50t

Companies Try New Tactic to Tap Climate-Sensitive Investors; Transition bonds are emerging as a new asset class in the debt market, creating a link between fossil-fuel companies and ESG investing
Anna Hirtenstein – WSJ
When Cadent Gas Ltd. needed to replace parts of its pipeline network across England this year, it raised EUR500 million selling a new type of debt, known as transition bonds.
/on.wsj.com/2CRTpVy

Companies Rush to Burnish Their Green Credentials: Week in Green; What you need to know from the week in Green.
Josh Petri – Bloomberg
As concern mounts that it’s already too late to rescue the planet from the worst of global warming, companies in almost every industry are rushing to assure consumers that they’re taking the climate crisis seriously. Some of these companies seem genuine. Others, not so much.
/bloom.bg/3g9Jrgx

It’s Time To Question This Tired Piece Of Financial Advice
Garrett Gunderson – Forbes
If you invest in the stock market, you’ve probably heard this kind of advice before: Stay the course. You’re in it for the long haul. Corrections are normal, so don’t panic. This is great advice… if you want to lose money over the next twenty-six months! The only thing holding up this overvalued market is trillions of dollars flooding the market, but how long can that last?
/bit.ly/3gbmNnQ

Markets Bombed, Investors Carried On; It’s going to take a lot more than a single market meltdown for small investors to chicken out of stocks
Jason Zweig – WSJ
One of the biggest surprises in the first half of 2020 was what didn’t happen: Most individual investors, despite their reputation as nervous Nellies who sell into every panic, didn’t dump their stocks even when the market meltdown was at its worst.
/on.wsj.com/2Vpb90Q

The Climate Financial Risk Forum publishes its guide to help the financial industry address climate-related financial risks
UK FCA
Today the Climate Financial Risk Forum (CFRF) has published a guide written by industry for industry to help firms approach and address climate-related financial risks. The guide, the first of its kind, provides practical recommendations to firms of all sizes on disclosure of climate-related financial risks; effective risk management; scenario analysis, and opportunities for innovation in the interest of consumers.
/bit.ly/3g7Oqyd

Stocks Set Adrift After Losing Propellers and Anchors; Investors look to a reluctant Fed to come to the rescue again.
Mohamed A. El-Erian – Bloomberg
Another volatile week in the U.S. equity market highlighted an inconvenient reality that investors have not yet fully grasped: Stocks now lack not just upward drivers but also anchors to maintain what has been an astonishing disconnect between elevated prices and challenged economic and corporate realities.
/bloom.bg/3gbIOmS

Amateur Traders Pile Into Asian Stocks, Making Pros Nervous
Gearoid Reidy and Ayaka Maki – Bloomberg
Japan, India, Thailand see surge in retail trading accounts; Need to be wary that markets seem a bit complacent: FIL
When the coronavirus pandemic sent shares plunging, you didn’t have to be a professional investor to spot a buying opportunity. In fact, it might be better if you weren’t.
/bloom.bg/389D1es

Oil groups boosted by cuts to US royalty rates during pandemic; Trump administration has slashed amounts companies must pay for access on government-owned land
Gregory Meyer – FT
Oil and natural gas companies that drill on US government-owned land are spending less for access after the Trump administration invoked the coronavirus crisis to slash the royalties they pay.
/on.ft.com/2BTviVN

Pension funds are playing a loser’s game in alternative assets; High fees have morphed into a benefit-free annual donation to the finance industry
Jonathan Ford – FT
Nearly half a century ago, Charles Ellis, a well-known US investment consultant, wrote an influential paper likening the money management business to a game of tennis.
/on.ft.com/3dEYIV7

Institutions

Commerzbank Weighs 7,000 Job Cuts, 400 Branch Closures
Eyk Henning and Steven Arons – Bloomberg
New targets may be presented at supervisory board meeting; Investors had widely rejected previous plan by CEO Zielke
Commerzbank AG’s leaders, accused of “abject failure” by their top private shareholders, are preparing a response that would raise cost-cutting and profitability targets.
/bloom.bg/2ZmatdM

Big banks are at a crossroads: Safe enough to skirt some regulation, but risky enough to stress out the Fed
Rey Mashayekhi – Fortune
For big banks, it was a good news/bad news kind of week. Despite receiving some good news on the regulatory front this week, Wall Street’s big banks also got a dose of reality in the form of the Federal Reserve’s stress tests.
/bit.ly/3icw2X2

A new trend is shaking up the ETF industry: active management; Traditional fund groups are fighting back by launching ETFs that buy assets without following an index
David Tuckwell – FT
Entering client meetings and conference halls like conquering noblemen, the champions of the exchange traded fund industry denounced stock pickers, brokers and fund gurus for their greed.
/on.ft.com/2BTvJPV

Money-Market Shifts Are Bad News for Profit-Starved Global Banks; Fidelity’s closure of some prime money-market funds is a negative omen for non-U.S. banks
Mike Bird – WSJ
Last week, Fidelity Investments said it would close two institutional prime money-market funds with a total of around $14 billion in net assets. That’s an ominous portent for some non-U.S. banks, which have increasingly come to rely on such funds to raise dollars they can’t easily acquire at home.
/on.wsj.com/2BQvx3U

Regions

Japan’s Work Culture Gets a Needed Covid-19 Shock; Remote work may have finally persuaded the nation’s corporate leaders that endless hours at the office are a waste.
Noah Smith – Bloomberg
Japan’s corporate culture is stuck in a bad place. But the coronavirus pandemic might have given it just the nudge it needs to get out of the trap. From the 1960s through the 1980s, the country developed a corporate system that worked well. Managers, rather than shareholders, controlled companies, allowing long-term planning and investment, keeping employment levels high and fostering economic equality. Workers were hired with the presumption that they would be at one company for their entire career, which gave their employer an incentive to spend lots of resources training them. And everyone worked very long hours.
/bloom.bg/38dyxn2

American Companies Find Willing Buyers of Debt Abroad; Asian and European firms have rushed to buy U.S. corporate bonds, attracted by higher yields and falling costs for hedging currency risk
Joe Wallace and Frances Yoon – WSJ
Overseas investors are flocking to buy U.S. corporate bonds, aiding a recovery in credit markets that were thrown into disarray by the pandemic.
/on.wsj.com/2BJG4hr

It’s Hard to Be the Next China, Not Impossible; The main obstacle to India becoming an export powerhouse may be the pull of its own protectionist past.
Andy Mukherjee – Bloomberg
Is the global monetary order ready for another reboot? In the 1960s, Japan and Europe exported their way to post-World War II prosperity under the fixed exchange rates of the Bretton Woods agreement. The U.S. went off the gold standard in 1971, but the established way of doing things didn’t collapse. Thirty years later, China essayed the role of being the world economy’s periphery and selling cheap widgets to a revamped core — the West and Japan — with the help of an undervalued exchange rate.
/bloom.bg/38fhd15

Bankers in India Are More Productive Working From Home
Ronojoy Mazumdar – Bloomberg
70% of Jefferies’ India staff have seen higher productivity; Three of the world’s top 5 most congested cities are in India
Work from home may remain part of the norm for many in India’s financial industry beyond the end of the world’s biggest lockdown. The reason: elimination of lengthy commutes in the past three months has boosted employee productivity.
/bloom.bg/2BnjafT

Hong Kong brokerage Bright Smart bets on online trading apps, with eye on mainland Chinese clients
Martin Choi – South China Morning Post
Launch of new online trading applications has helped the company increase its total number of client accounts by about 20 per cent;After two or three years, turnover from mainland China could overtake that from Hong Kong, chairman says
Hong Kong-listed brokerage Bright Smart Securities hopes to capitalise on growing interest in the city’s stock market among mainland Chinese investors, and said online trading would be key to its success. “Securities firms have to use online trading to grow their businesses,” Peter Yip Mow-lum, Bright Smart’s chairman and founder, said in an interview. “This way, securities firms can use a little bit of capital to do a huge amount of business. Trading volumes can increase from 10 to a hundred times with the help of technology.”
/bit.ly/2CUTgAR

Hundreds of Dutch Farmers Sign $560 Million Wind-Farm Deal
Will Mathis – Bloomberg
New financing will help replace old turbines with new ones; Re-powering can provide more electricity with fewer turbines
A collective of more than 200 farmers in a rural part of the Netherlands got financing to build one of the largest onshore wind farms in the country.
/bloom.bg/31o0hnP

China’s Rise Heralds Return of the Domino Theory; Seventy years ago the Korean War raised legitimate fears that one U.S. loss could set off communist victories across the globe.
Hal Brands – Bloomberg
The domino theory — the idea that setbacks can accumulate quickly and catastrophically — is one of the most controversial ideas in U.S. foreign policy. It guided a half-century of statecraft during the Cold War, only to be rejected by many historians of that conflict. But the anniversary of the Korean War, which began 70 years ago this week, reminds us that the domino theory was rooted in key realities of international affairs. And it alerts us that domino dynamics could affect U.S.-China competition today.
/bloom.bg/31sSzJg

Indonesia Nears Deal With Central Bank on Deficit Funding
Grace Sihombing and Rieka Rahadiana – Bloomberg
Bank Indonesia may buy $28 billion bonds at zero interest; Government exploring ways to fund wider deficit to fight virus
Indonesia’s central bank may buy billions of dollars of sovereign bonds at zero interest, or below its benchmark rate to help the government finance a wider deficit arising out of stimulus measures to counter the fallout of the coronavirus pandemic.
/bloom.bg/2ZmVSPp

Locust Swarm Enters India’s Sugar Cane Region
Pratik Parija – Bloomberg
Operations to control the locusts in full swing in 7 states; Attack in Gujarat in January was biggest in over 25 years
A fresh swarm of desert locusts has entered Uttar Pradesh, India’s biggest sugarcane grower, via capital city Delhi and the northern state of Haryana, according to the federal farm ministry.
/bloom.bg/389Q8wp

China Oil Titans Plan Joint Crude Buying to Add Market Clout
Alfred Cang – Bloomberg
Four state refiners to collectively bid for some oil grades; Refiners may conduct trial runs in spot market for Russia ESPO
China’s state-owned oil refining giants are in discussions to form a purchasing group to buy crude together, increasing their bargaining power and avoiding bidding wars.
/bloom.bg/2VrtxpL

The Toughest Times May Be Over for Asia’s Worst-Performing Currency
Kartik Goyal – Bloomberg
India’s rupee seen rising to 75 by year-end: Bloomberg Survey; Foreign inflows, cheap oil bolster rupee outlook, analysts say
India’s rupee, this year’s worst-performing currency in Asia, may finally be ready to join the recovery seen in emerging markets. The rupee may strengthen to 75 per dollar by the end of December, an advance of about 1% from 75.5650 at 11:20 a.m. in Mumbai on Monday, according to a Bloomberg survey. The currency has dropped 5.6% so far in 2020.
/bloom.bg/2NGVh5w

China overtakes UK to become world’s fifth-largest fund hub; Shift underscores Asian giant’s status as a rare bright spot for global asset managers
Siobhan Riding – FT
China has leapfrogged the UK and France to become the world’s fifth-largest fund domicile, as the breakneck growth of its fledgling investment sector continues despite the coronavirus-induced recession. Chinese funds increased their share of the global investment market significantly in the first three months of 2020, propelling the country from tenth to fifth position in a quarterly fund domicile ranking compiled by the European Fund and Asset Management Association and the US’s Investment Company Institute.
/on.ft.com/3eJ0ypd

Brexit

UK must reveal state-aid plan to unblock Brexit talks, EU warns; Brussels says that Britain’s silence on subsidies risks hampering intensified talks starting Monday
Jim Brunsden, Peter Foster and Jim Pickard – FT
Brussels is calling on the UK to reveal its post-Brexit policy on state aid, saying that Britain’s lack of a public plan for a domestic subsidy regime risks hampering the two sides’ future relationship talks.
/on.ft.com/2Ad0rDg

Brexit: Will return of face-to-face talks mean progress?
Katya Adler – BBC
So the “tiger in the tank” (Prime Minister Boris Johnson’s words) of EU-UK post-Brexit trade talks is all geared up to pounce. Monday sees the start of a month of intensified negotiations between the two sides. This will include weekly meetings – at times in London, at others, in Brussels. And the first face-to-face talks since the Covid-19 pandemic hit Europe, infecting the EU and the UK’s chief negotiators.
/bbc.in/389baLs

‘We’ve bought the wrong satellites’: UK tech gamble baffles experts
Alex Hern – The Guardian
The UK government’s plan to invest hundreds of millions of pounds in a satellite broadband company has been described as “nonsensical” by experts, who say the company doesn’t even make the right type of satellite the country needs after Brexit. The investment in OneWeb, first reported on Thursday night, is intended to mitigate the UK’s loss of access to the EU’s Galileo satellite navigation system.
/bit.ly/2BOU2yJ

Angela Merkel: UK must live with consequences of weaker ties to EU
Philip Oltermann – The Guardian
The UK will have to “live with the consequences” of Boris Johnson ditching Theresa May’s plan to maintain close economic ties with the EU after Brexit, Angela Merkel has said, hardening her tone over the prospect of a no-deal scenario at the end of the year. After more than three years in which the German chancellor repeatedly emphasised her openness to a deal that would maintain the UK’s current flows of trade with the bloc, she suggested the door leading to such a compromise had now closed.
/bit.ly/2Zh8V4M

Inside the Brexit Talks, Frustration Starts to Give Way to Hope
Ian Wishart – Bloomberg
Brexit’s backstage operators are getting ready to swing into action. With six months to go before the U.K. finally breaks its ties with the European Union, and hardly any progress made in the negotiations over their future relationship, officials are gearing up for an intense eight weeks that will define what that will look like for decades to come. Britain’s chief negotiator, David Frost, and the EU’s deputy chief negotiator, Clara Martinez Alberola, will meet in person in Brussels on Monday for the first time since March. One is a committed Brexiter who used to run the Scotch Whisky Association, the other a Spanish lawyer who has worked for the bloc for almost 30 years.
/bloom.bg/2BcBb0F

Brexit Is a Test of De-Globalization in a World of Covid-19
Max Colchester and Laurence Norman – WSJ
The impending economic divorce between the U.K. and the European Union has become an experiment in rapid de-globalization against the background of a global pandemic. Britain officially left the world’s largest trading bloc in January, but the country remains in the EU’s customs area and single market until the end of the year, allowing time for trade talks. On Monday, British and European Union negotiators will begin stepping up attempts to secure an unusual kind of deal: one putting up new barriers to commerce.
/on.wsj.com/2BOE73g

Miscellaneous

What to Do When Your First Job Isn’t a Good Fit; The economic downturn means many college graduates aren’t landing their dream jobs right away; here’s how to turn a less-than-perfect position into a career stepping-stone
Kathryn Dill – WSJ
Libby Otto had a plan. Graduate from Bryn Mawr College. Move to Washington. The sociology major hoped to find a job in policy work in the nation’s capital. But when Bryn Mawr closed its Pennsylvania campus in March as coronavirus spread, Ms. Otto found herself back at her parents’ home in Seattle, finishing classes online and revamping her job search.
/on.wsj.com/2NABvIW

Sotheby’s to Auction Late Financier Felix Rohatyn’s Art Collection; Holocaust refugee who saved New York City from bankruptcy in 1970s quietly collected Old Master paintings and drawings
Charles Passy – WSJ
Felix Rohatyn may be best known to New Yorkers as the investment banker who helped the city avoid bankruptcy in the 1970s, thanks to the advisory role he played at the behest of then-Gov. Hugh Carey.
/on.wsj.com/2VtluZC

A Pandemic Problem for Older Workers: Will They Have to Retire Sooner? They face particular challenges brought on by Covid-19 — issues, experts say, that could lead to retirement earlier than planned.
Mark Miller – NY Times
Dorian Mintzer loves her work. A 74-year-old psychologist, coach and author, she has no plan to retire, and has continued to work during the pandemic, doing teletherapy from her home in the Boston area.
/nyti.ms/31pv43s

The Long, Unhappy History of Working From Home; As the coronavirus keeps spreading, employers are convinced remote work has a bright future. Decades of setbacks suggest otherwise.
David Streitfeld – NY Times
Three months after the coronavirus pandemic shut down offices, corporate America has concluded that working from home is working out. Many employees will be tethered to Zoom and Slack for the rest of their careers, their commute accomplished in seconds.
/nyti.ms/3eLUkF1

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

The City of London’s Supremacy Goes Very Deep

The City of London’s Supremacy Goes Very Deep

First Read $16,711/$300,000 (5.6%) ++++ FIA Asia-V: Asia-Pacific Exchanges Look Back and Ahead Sarah Rudolph and Suzanne Cosgrove - John Lothian News In the first panel at FIA's Asia-V 2020 Expo, exchanges in the Asia-Pacific looked back at their successes during a...

Pin It on Pinterest

Share This Story