U.S. Election Priced as Worst Event Risk in VIX Futures History

Sep 2, 2020

First Read

Hits & Takes
John Lothian & JLN Staff

The tribute page to the late Richard Schaeffer has been updated to include one from Mary Bergonia Ross, a good friend from the NYMEX. I met her as Mary Bergonia when she ran the Chicago office of Man Financial.

Her remembrance starts with this: Richie was a dear friend, a formidable competitor, and a fearless leader for all of us at NYMEX. My first memory of Richie is handing him a rather large Heating Oil order to execute in the earliest illiquid days of the contract in the early 80s.

Scott Johnston is out at Citadel, where he was chief administrative officer. His Linkedin status says his new job is “Non-Compete Period at Citadel.” Johnston is a former CIO of the CME among other industry positions. When I first met Scott when he was at CME and I was running the electronic trading division of The Price Group, I felt like he downloaded my brain over lunch. He was so inquisitive looking for problems to fix with CME electronic trading. I learned something very important from him, problems are opportunities. They are opportunities to solve the problem and make things better, and that is a good thing. He had a great attitude.

Ted Sturiale has joined CloudQuant as vice president of sales.

In another closing in the Chicago financial district of a small business, the bar Cactus Club is closing after 31 years. The bar was a block away and kitty corner from the CBOT Building. It was next to Cals Liquors for many years.

Here are some product highlights from the CME Group’s August volume update:

CME Group had record Metals average daily volume, or ADV, up 15% from August 2019, including record Silver futures ADV of 221,000 contracts, up 61% from August 2019, record Micro Gold futures ADV of 194,000 contracts, up 380% from August 2019 and record Micro Silver futures ADV of 34,000 contracts, up 1,000% from August 2019. They had record 3-Year Treasury Note futures trading volume of 13,401 contracts on August 31. The Micro E-mini Equity futures ADV grew 72% from August 2019, while the options on Micro E-mini S&P 500 and Micro E-mini Nasdaq-100 futures launched August 31, trading a combined 1,815 contracts on day one. Their Natural Gas options ADV rose 53% from August 2019 and Soybean futures ADV grew 23% from August 2019. Lastly, their SONIA futures ADV grew 22% from August 2019 and their Wheat futures ADV rose 20% from August 2019.

The MGEX had its second best month in its history with a total monthly volume of 318,992 contracts. This past month was also the best August in Exchange history, beating the previous record holder, August 2017, by nearly 7,500 contracts. August 2020 saw a 12% increase in total volume compared to August 2019. This is the sixth consecutive August (2015-2020) to hold a place in the top-25 record book for best overall month. Additionally, the calendar year to date total is up 17% compared to this time last year.

The 100 Club is an organization in Chicago that raises money for the families of fallen first responders. They normally fund their scholarships and aid to families and students with an annual gala, which they can’t hold this year due to the pandemic. Their Raising Hope 2020 program hopes to raise $400,000. Please read about this important organization and consider making a donation or becoming a member.

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

*****

OCC reported Tuesday that total August 2020 contract volume was 615,972,402 contracts, up 28.7 percent from August 2019 and the third-highest month on record. Volume gains were led by equity options — total equity options volume was up 39.1 percent last month compared with August 2019, with 582,394,732 contracts traded. Monthly index options volume lagged in August, down 41.8 percent versus August a year ago, with a total of 29,389,883 contracts. Year-to-date, OCC’s average daily volume was 28,466,064 contracts, up 44.7 percent from August 2019. Additional OCC volume details can be found here. ~SC

The Chicago-based fintech firm AeroPay, a company that provides digital payment services to state legal cannabis businesses, and Safe Harbor Private Banking, a division of state-chartered Partner Colorado Credit Union, announced a strategic partnership Tuesday. The arrangement combines AeroPay’s payment technology with Safe Harbor Private Banking’s compliance-based banking program for cannabis businesses. Colorado-based Safe Harbor will provide banking services for the businesses and process transactions on the back end as part of the deal. More information is available in a press release here. ~SC

According to the German press, five years after German Chancellor Angela Merkel turned back criticism of her refugee policy saying, “Wir schaffen das” (we’ll make it), government statistics show roughly 50% of refugees were working. Though controversial at its inception, the refugee program is now widely viewed as a success in integrating new workers into the workforce. Employed refugees are, however, more vulnerable to the layoffs and dismissals resulting from the coronavirus pandemic, says a recent report from the Institute for Career and Employment Research.~Thom Thompson

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Trader Fat Finger Blamed for Accidentally Selling 5 Million Company Shares
Bloomberg News
Sale was made by a trader managing chairman’s account; Li Dongsheng issued an apology Wednesday on social media
The chairman of TCL Technology Group Corp. said a trader accidentally sold 5 million company shares using his account — an incident that comes as the stock nears a record high. The sale was made at 1:03 p.m. Tuesday by a trader managing chairman Li Dongsheng’s accounts who had typed in the wrong stock code, the Guangdong-based panel maker said in a filing to the Shenzhen exchange. Li bought back the shares for 35.8 million yuan ($5.2 million) less than two hours after the trader sold them for 35.9 million yuan, the firm said. He will hand over profits from the trade to the company, the statement added.
/jlne.ws/2YSE3s3

*****This is so 1999.~JJL

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Small-Business Failures Loom as Federal Aid Dries Up; Many owners face tough choices after a federal loan program and other government moves to bolster the economy have run their course.
Ben Casselman – NY Times
The United States faces a wave of small-business failures this fall if the federal government does not provide a new round of financial assistance — a prospect that economists warn would prolong the recession, slow the recovery and perhaps enduringly reshape the American business landscape.
/jlne.ws/3bhHOMH

*****The number of small businesses failing just continues to pile up.~JJL

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U.S. Faces A ‘Perfect Storm’ Of Political Violence Heading Into November Election; There have been nearly 11,000 demonstrations in the U.S. this summer — as well as a rising tide of state repression and vigilante violence.
Christopher Mathias – Huffington Post
Law enforcement and other authorities used force while intervening in nearly 400 Black Lives Matter protests since police killed George Floyd in May, according to new data that paints the clearest portrait yet of the historic unrest that’s swept across the U.S. this summer.
/jlne.ws/31QxBUb

*****We doth protest a lot.~JJL

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Tuesday’s Top Three
Our top story Tuesday was Markets need to be part of climate change solution, says FIA, a new policy paper on sustainability from the Futures Industry Association in consultation with its members. Second was A Robot to Suppress ‘Bogus’ Traders Is in Works in South Korea, from Bloomberg. Third was the Financial Times’ QAnon lures adherents by acting like a game.

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Lead Stories

U.S. Election Priced as Worst Event Risk in VIX Futures History
Michael P. Regan – Bloomberg
Elevated October futures show hedging for November volatility; Trades set for ‘pretty incredible fireworks:’ strategist Crise
As the U.S. stock market continues to rally to record highs, the attention of many investors is turning toward November’s elections as a source of risk. However, hedging against that potential volatility doesn’t come cheap. In fact, it’s currently the most-expensive event risk on record based on a common way to bet on volatility known as a “butterfly trade.” Futures tied to the Cboe Volatility Index expiring in late October closed on Tuesday at 33.5, compared with a spot VIX that closed at 26.1. Those October contracts, which are currently the second-month futures and reflect expected volatility in the month after they expire on Oct. 21, are also higher than the first-month futures expiring in September and the third month expiring in November.
/jlne.ws/3i3UwRu

NYSE Direct Listings Hit Snag as Investor Group Raises Concerns; Council of Institutional Investors says it will ask SEC commissioners to review plan
Alexander Osipovich – WSJ
The New York Stock Exchange’s plan to let companies raise capital through direct listings is on pause after an influential group of institutional investors took an unusual regulatory step in a last-ditch effort to block it. The Council of Institutional Investors, which was behind the maneuver, raised concern that the NYSE’s plan would let companies circumvent protections built into the initial public offering process, ultimately harming investors.
/jlne.ws/3jCLCuJ

Nvidia’s Latest Chips Are a Literal Game Changer; The tech company’s new lineup proved once again that it’s well ahead of rivals and worthy of the title of America’s reigning chip champ.
Tae Kim – Bloomberg
For all those who cite Intel Corp.’s troubles as symbolic of the U.S. semiconductor industry’s decline, here are two heartening words: Nvidia Corp. On Tuesday, Nvidia — a red-hot maker of chips for video games, artificial intelligence and cloud computing — proved again that it is way ahead of its rivals in terms of innovation and performance. The Silicon Valley-based company announced a lineup of three new gaming graphics cards based on its latest “Ampere” chip architecture, saying they will deliver up to double the performance of its prior offerings in the “greatest generational leap” in its history. Prices for the new products range from $499 to $1,499, with two due to come out later this month and the third to be released in October. All in all, the news was enough to send Nvidia’s shares up more than 3%.
/jlne.ws/3hQq8KA

Investors brace for choppy markets as race for White House heats up; Derivatives linked to volatility index reflect nerves over fraught presidential election
Robin Wigglesworth – FT
Traders are ratcheting up bets on a particularly turbulent US presidential election on November 3, and a potentially messy aftermath. Futures contracts on the Vix volatility index — which uses options to derive an estimate of the future choppiness of the S&P 500 stocks benchmark — show what some traders call a “kink” around October and November, in a pick-up that exceeds previous contests for the White House.
/jlne.ws/3lHp3XF

JPMorgan Says Key Markets Brace for a Contested Election
Joanna Ossinger – Bloomberg
Currencies may be best place to hedge results, Younger says; ‘Surprising’ a delay isn’t factored into FX prices: strategist
Key U.S. markets now appear to be pricing in the risk of a delayed or inconclusive result from the upcoming presidential election, according to fresh analysis from JPMorgan Chase & Co.
/jlne.ws/3hUkaIt

Swiss regulator escalates probe into Credit Suisse spying scandal; Finma opens enforcement proceedings over corporate espionage by Swiss bank
Harry Dempsey and Owen Walker – FT
Switzerland’s financial regulator has begun enforcement proceedings against Credit Suisse over the bank’s corporate espionage scandal, marking an escalation in the fallout of an affair that rocked the country’s financial industry last year.
/jlne.ws/3jHCRjf

One of the World’s Richest Petrostates Is Running Out of Cash
Fiona MacDonald – Bloomberg
Cheap oil is forcing debate on state handouts across the Gulf; Kuwait among exporters facing deficits due to lower oil prices
When Kuwait’s then-Finance Minister Anas Al-Saleh warned in 2016 that it was time to cut spending and prepare for life after oil, he was ridiculed by a population raised on a seemingly endless flow of petrodollars. Four years on, one of the world’s richest countries is struggling to make ends meet as a sharp decline in energy prices raises profound questions over how Gulf Arab states are run.
/jlne.ws/3gWm6yJ

Fed’s Mortgage-Buying Spree at $1 Trillion With No End in Sight
Christopher Maloney – Bloomberg
The bank now owns 30% of outstanding agency mortgage bonds; FOMC promises to keep buying ‘at least at the current pace’
The Federal Reserve has snapped up $1 trillion of mortgage bonds since March, a record pace of purchasing, as the U.S. central bank tries to blunt the impact of the Covid-19 recession on American homeowners.
/jlne.ws/3hT0AMG

A Top Fed Official Warns That Economic Risks Aren’t Over; Lael Brainard, a Federal Reserve governor, said government support would be needed to support households and businesses as pandemic-induced pain continued.
Jeanna Smialek – NY Times
Lael Brainard, a Federal Reserve governor, said on Tuesday that the U.S. economy remained at risk as the coronavirus pandemic wore on — and support from Congress and the White House would be crucial to cushioning the blow.
/jlne.ws/3lJMujh

CFTC provides additional Libor transition relief to swaps participants; The latest no-action letters issues by the CFTC follow the regulator’s move to provide market participants relief in December.
Annabel Smith – The Trade
Swaps dealers have been handed additional relief by the US derivatives watchdog amid the transition from the Libor and other interbank reference rates to alternative benchmarks. The US Commodity Futures Trading Commission (CFTC) issued several revised ‘no-action letters’ outlining the conditions under which counterparties can qualify for additional relief for certain trade execution and clearing requirements, as well as swap dealer and uncleared margin requirements.
/jlne.ws/34WaRnD

SEC Cancels Vote on Controversial Whistleblower Program Reforms; The U.S. Securities and Exchange Commission has twice canceled a vote on a proposal that could allow it to curtail the largest whistleblower awards
Dylan Tokar – WSJ
The U.S. Securities and Exchange Commission has called off a second attempt to vote on long-pending amendments to its whistleblower award program—a sign the agency’s commissioners still haven’t reached a consensus on a final version of the rules.
/jlne.ws/32LTBit

U.S. and China Should Seek a Truce in Tech Cold War; The world’s two biggest economies need to work on developing shared global rules to govern digital trade flows.
Wang Huiyao – Bloomberg
It would be easy to dismiss the Trump administration’s campaign against Chinese apps TikTok and WeChat as part of an election strategy to attack China from all angles. The moves, however, as well as China’s counter-response, are contributing to a deeper problem at the heart of the global economy — one that can’t be resolved unless the world’s two biggest economies work together.
/jlne.ws/2F2p4V9

Dutch regulator calls for overhaul of MiFID II fixed income transparency rules; The AFM stated in a recent report the overall sentiment is that MiFID II has not yet delivered its goals in fixed income markets, and should be considered a work in progress.
Hayley McDowell – The Trade
The Dutch Authority for the Financial Markets (AFM) has recommended major changes to MiFID II’s rules for fixed income and derivatives trading in a recent study, which found the regulation’s focus on transparency has been ‘counterproductive’.
/jlne.ws/32NUuqK

Technology has abetted China’s surveillance state; Beijing’s plan for a digital currency presents yet another opportunity for citizens to be monitored
Orville Schell – FT
In the spring, the Chinese Communist party took an important step toward realising President Xi Jinping’s vision of a “China Dream”. In April, the People’s Bank of China announced the establishment of a central bank digital currency that is now being tested in four cities as a prelude to converting the entire economy from cash to digital currency. This is the latest in a long series of initiatives launched to fortify China’s one-party state with innovative new technologies.
/jlne.ws/3jCd9MT

In Chicago visit, Dr. Birx raises alarm over growing COVID-19 positivity rates in parts of Illinois
Lisa Schencker – Chicago Tribune
White House coronavirus response coordinator Dr. Deborah Birx expressed concern during a visit to Chicago Tuesday about the growing number of counties in Illinois where 5% to 10% of COVID-19 tests are coming back positive.
/jlne.ws/3hTJdv9

Landlords of Hong Kong’s ‘Ginza-style’ commercial buildings slash rents and target non-restaurant tenants amid coronavirus downturn; Buildings housing restaurants, bars and shops on higher floors are struggling to retain tenants as previously unaffordable street-level rents tumble; Landlords are cutting rents to compete, and targeting a broader range of tenants, such as medical clinics and beauty salons
Lam Ka-sing – South China Morning Post
The ‘Ginza’ buildings sprouted across Hong Kong, especially in tourist districts like Causeway Bay (pictured) and Tsim Sha Tsui, during a boom in tourism to satisfy demand in a city famous for its shortage of space.
Landlords of Hong Kong’s “Ginza-style” commercial buildings are slashing rents by up to 40 per cent and shifting their focus away from restaurants and bars to survive the dramatic downturn in the catering and retail sectors caused by the coronavirus pandemic.
/jlne.ws/2QPtyBn

LiquidityBook to Roll Out Trade-Matching Engine; The vendor also has plans to expand further into the institutional space with two additional rollouts in 2021.
Hamad Ali – Waters Technology
LiquidityBook is introducing a trade-matching engine that is scheduled to be rolled out in Q1 2021. Shawn Samuel, CTO at LiquidityBook, says the vendor has released a beta version of the tool to several clients. “Most of our clients are integrated into Omgeo or another trade-matching service, for which we do all the integration,” Samuel says. “But we are rolling out our own FIX-based trade-matching system as a standalone product over the next five or six months.”
/jlne.ws/3hQOaFj

Coronavirus

Advisers See No Data Favoring Trump-Touted Plasma Therapy
Michelle Fay Cortez, Robert Langreth, and Anna Edney – Bloomberg
Convalescent plasma doesn’t improve covid-19 survival; Therapy shouldn’t be considered standard of care, advisers say
A panel of experts convened by the National Institutes of Health undercut an emergency authorization issued just days ago by U.S. regulators, saying there’s not enough evidence to recommend use of convalescent plasma for hospitalized coronavirus patients.
/jlne.ws/31Si8TH

The New Rules for Landing a Job in the Covid Era; The coronavirus pandemic has put millions of Americans out of work, but people are still getting hired. Here’s how to join them.
Kathryn Dill – WSJ
It takes luck, creativity and a fresh look at your network of contacts to find a job in the worst labor market in more than a decade. Since the pandemic hit the U.S. hard in March, the economy has lost 13 million jobs, job seekers have seen offers yanked away, and many recent college graduates remain sidelined.
/jlne.ws/3jEAuxG

COVID-19’s Impact on Arbitration – Practical Tips & What’s New in Arbitration Procedures
FINRA
Panelists discuss how COVID-19 challenges are impacting their cases, offer tips and resources for conducting effective Zoom virtual arbitration hearings, and share the latest in arbitration procedures.
/jlne.ws/34VSqQ4

If You Don’t Have a Vaccine, Try Fighting the Virus With … TikTok? While the United States was creating confusion with its virus messaging, the rest of the world got creative.
Sanya Dosani and Chai Dingari – NY Times
While the United States was creating confusion with its virus messaging, the rest of the world got creative.
Imagine living in a country where, six months into a pandemic, you aren’t totally confused. You know exactly where and when to get tested. Your child’s school has been clear and transparent about its reopening plan. On the whole, you trust your government to make the right decisions.
/jlne.ws/2YXYBPS

‘Russian Roulette’: Inside Putin’s Race to Develop a Covid-19 Vaccine Before the West; Moscow’s self-declared victory has been greeted with skepticism among scientists and Western politicians
Georgi Kantchev and Thomas Grove – WSJ
In April, as Covid-19 cases surged across Russia, President Vladimir Putin called a meeting of the country’s top scientists and health officials over video link to deliver an urgent directive: Do whatever you need to create a national vaccine as soon as possible.
/jlne.ws/32NDiSj

‘Vaccine nationalism’ delays WHO’s struggling Covax scheme; Deadline pushed back as organisers redesign facility to get rich countries on board
Donato Paolo Mancini and Michael Peel – FT
The World Health Organisation has been forced to redesign its global Covid 19 vaccine procurement facility, after rich nations were slow to sign up and sought bilateral deals instead. Governments were told last week that the deadline to join the so-called Covax programme had been pushed back from August 31 to September 18, according to documents seen by the Financial Times. The final date for initial payments from participating countries has been postponed to October 9, the documents show, and new procurement options have been introduced to offer improved flexibility.
/jlne.ws/3lKiqnk

Thailand Marks 100 Days Without Any Local Virus Cases
Randy Thanthong-Knight – Bloomberg
Pressure growing to re-open borders to save tourism sector; Thailand was first to see a case outside of China in January
Thailand has reported zero locally-transmitted Covid-19 cases for 100 days in a row, joining a small group of places like Taiwan where the pathogen has been virtually eliminated. The Southeast Asian country hasn’t recorded any community transmission since May 26, data from the Health Ministry on Wednesday showed. Authorities are still finding infections among travelers arriving at the tourist hotspot’s borders, but these people are quarantined and only allowed into the community after they’re recovered.
/jlne.ws/3hWt20g

Sanofi Halts Kevzara Tests for Covid as Drug Fails to Help
Thomas Mulier – Bloomberg
Sanofi said the rheumatoid arthritis medicine Kevzara failed to work against the new coronavirus, joining a growing list of treatments that were tried and discarded in the pandemic.
/jlne.ws/2F2oUwY

U.S. says it won’t join WHO-linked effort to develop, distribute coronavirus vaccine; Nita Patel, director of antibody discovery and vaccine development at Maryland-based Novavax labs, lifts a vial containing a potential coronavirus vaccine on March 20.
Emily Rauhala and Yasmeen Abutaleb – Washington Post
The Trump administration said it will not join a global effort to develop, manufacture and equitably distribute a coronavirus vaccine, in part because the World Health Organization is involved, a decision that could shape the course of the pandemic and the country’s role in health diplomacy.
/jlne.ws/3gTMaux

Exchanges, OTC and Clearing

CME Group Reports August 2020 Monthly Market Statistics
CME Group
CME Group, the world’s leading and most diverse derivatives marketplace, today reported August 2020 market statistics, including average daily volume (ADV) of 16.4 million contracts during the month. Open interest at the end of August was 101 million contracts. Market statistics are available in greater detail at https://cmegroupinc.gcs-web.com/monthly-volume.
/jlne.ws/2YXPUox

Revision to CH Advisory 20-339 Eris Swap Future Transition to SOFR Discounting
CME Group
On Sunday, October 18, 2020, for the clearing cycle Monday, October 19, 2020, and pending all regulatory review, CME will transition its existing Eris Swap Futures from OIS discounting to SOFR discounting. ERIS Swap Futures contracts will continue to clear using EFFR discounting and price alignment through October 16, 2020. After the discounting transition ERIS Swap Futures contracts will be priced using SOFR discounting and price alignment.
/jlne.ws/2GlTRx4

September 2020 Stock, ETF, and Corporate Bond Update – Effective September 1, 2020
CME Group
September Stock, ETF, and Corporate Bond Update is available at www.cmegroup.com/clearing/financial-and-collateral-management.html
/jlne.ws/3500AH8

Withdrawal of an Approved COMEX Copper Warehouse
CME Group
Please be advised that Utah Commodity Storage, Inc, an existing Warehouse for the storage of COMEX Copper, has requested from the Exchange that its facility located in Tooele, UT (Building 651) be withdrawn from its status as an approved COMEX Copper warehouse. This location will no longer be available for the storage of COMEX Copper deliverable against the respective futures contract.
/jlne.ws/2EG8f2N

Intercontinental Exchange President Ben Jackson to Present at the Deutsche Bank Technology Conference on September 14
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, announced today that Ben Jackson, President, will present at the Deutsche Bank Technology Conference on Monday, September 14 at 10:05 am ET. The presentation will be available live and in replay via webcast and can be accessed in the investor relations and media section of ICE’s website at http://ir.theice.com/.
/jlne.ws/34XCJb2

Eurex strengthens its Eurex EnLight offering with two new functionalities
Eurex
Eurex EnLight, our fully integrated off-book, on-exchange Request for Quotes (RFQ) platform is a completely automated solution that replicates the core aspects of voice trading in an electronic fashion. It provides its users all the advantages of automatic electronic price formation, data collection and timely information retrieval to meet MiFID II Best Execution requirements. Since its launch in March 2018, the platform has developed rapidly.
/jlne.ws/34VorYq

Fintech

TriOptima Extends Collaboration with AcadiaSoft to Improve Industry Standard for Collateral Interest Payments Processing
CME Group
TriOptima has extended its collaboration with AcadiaSoft to automate monthly collateral interest payments, making trade processing more efficient for over-the-counter (OTC) market participants. According to International Swap Dealers Association (ISDA) data, cash collateral accounts for approximately 70% of all collateral exchanged for non-cleared derivatives, equivalent to $1.3 trillion in 2019 alone. A significant proportion of this market still relies on email and manual reconciliation to manage the interest process. Now, with TriOptima’s expanded support for AcadiaSoft’s new interest payments messaging, the wider industry can benefit from increased efficiencies.
/jlne.ws/3jCldx9

Rigetti to build UK’s first commercial quantum computer; Start-up leads consortium including Standard Chartered and Edinburgh university
Siddharth Venkataramakrishnan – FT
Quantum start-up Rigetti is leading a £10m consortium to create the UK’s first commercially available quantum computer, opening up new economic and academic possibilities. The announcement of the project, backed by a UK government grant with matching contributions from the consortium partners, further establishes the UK’s position in a field with revolutionary potential.
/jlne.ws/3biou1C

Amazon’s new offerings make India centre of fintech push
Sankalp Phartiyal and Nupur Anand – Reuters
Amazon.com Inc (AMZN.O) has added insurance and even gold to its menu of financial services in India, to expand its customer base and attract more subscribers to its Prime loyalty programme in a battleground growth market. The push ramps up competition as financial technology (fin-tech) rivals and their deep-pocketed foreign backers struggle for profitability in a predominantly cash-based economy where about 190 million adults do not have bank accounts.
/jlne.ws/3lHJXpB

Fintech focused VCs Must Be Aware of Opportunities in DeFi, Blockchain Professional Argues, but Sector Not Ready for Mainstream Adoption
Omar Faridi – CrowdFund Insider
Linda Xie, co-founder at Scalar Capital, advisor at the 0x Project, and former product manager at Coinbase, says that if you’re a VC focused on investing in Fintech projects, then you really need to know what’s going in the so-called “decentralized” finance (DeFi) space, which is largely based on Ethereum (ETH).
Xie, a former risk analyst at AIG, notes that DeFi offers several different financial services such as the ability to transact with stablecoins, which aim to serve as digital currencies that are pegged 1-to-1 with fiat money like the USD, EUR, GBP or commodities like gold.
/jlne.ws/2Dnanf9

Amazon’s new offerings make India centre of fintech push
Sankalp Phartiyal, Nupur Anand – Reuters
Amazon.com Inc (AMZN.O) has added insurance and even gold to its menu of financial services in India, to expand its customer base and attract more subscribers to its Prime loyalty programme in a battleground growth market.
/jlne.ws/3lHJXpB

Cryptocurrencies

New Malware Spotted in the Wild Can Attack Crypto Wallets
Benjamin Powers – CoinDesk
A new form of malware called Anubis is now out in the world after being circulated for sale on cybercrime dark markets in June, according to Microsoft Security Intelligence. Using forked code from Loki malware, Anubis can steal cryptocurrency wallet IDs, system info, credit card information and other data.
Importantly, this malware is distinct from a family of Android banking malware also called Anubis. It joins a growing list of malwares that look for vulnerable cryptocurrency stashes.
/jlne.ws/2GnISmP

Minting Dozens of Coins a Day, Speculators Tap Into Crypto Craze
Olga Kharif – Bloomberg
More than 500 tokens added in last month, listing tracker says; Defi applications are a big factor in the latest boom
Risk is running rampant in financial markets. Stocks trade at dot-com-era valuations, the IPO pipeline is full, SPACs are back, Bitcoin’s headed toward a record. And right on cue, here come the crypto opportunists. Fueled by a spike in speculative appetite, cryptocurrency entrepreneurs are offering new digital coins at a torrid pace reminiscent of the Bitcoin boom three years ago. Among the freshly listed: Porkchop, Davecoin, Spaghetti, Newtonium and Whale. Many have no obvious utility, but investors have poured billions into them up in hopes of riding one to an easy profit.The world of crypto has always attracted peddlers of get-rich-quick products when fans of rewiring the global financial system start buying into a new idea. In 2017, it was Bitcoin and the end of fiat currency.
/jlne.ws/2ZaNAuP

Who cares about privacy? Not crypto users, says Coin Metrics
Turner Wright – Cointelegraph
The overwhelming majority of crypto transactions do not include privacy tokens, with most traders choosing to move funds transparently rather than privately.
According to crypto analytics firm Coin Metrics’ Sept. 1 State of the Network report, the combined daily transactions of three privacy coins, Zcash (ZEC), Monero (XMR), and Grin (GRIN), equated to only 6% that of Bitcoin (BTC), despite the coins offering substantially more privacy.
/jlne.ws/3jI06cZ

The IRS wants to tax every penny of your crypto, US government memorandum says
Benjamin Pirus – Cointelegraph
A recent memorandum from the U.S.’ tax authority, the Internal Revenue Service, or IRS, attempted to clarify taxation rules around receiving crypto assets as payment.
“Is convertible virtual currency received by an individual for performing a microtask through a crowdsourcing or similar platform taxable income?” said a document released on Aug. 28, adding:
/jlne.ws/3512iYP

A legal asset after all? Governments are cashing in on seized crypto
Kirill Bryanov – Cointelegraph
It is customary for government officials around the world to profess their disdain for crypto on the grounds that it is widely used to facilitate crime and finance terrorism. Although (government-backed) cash still remains criminals’ preferred financial tool by a wide margin, it is true that nefarious actors also turn to digital assets. When corrupt plans go sideways, law enforcement and other government agents can find themselves in possession of hefty sums of crypto.
/jlne.ws/2YXkxKZ

Singapore’s Lee Identifies Covid Missteps, Urges Vigilance
Faris Mokhtar – Bloomberg
Singapore’s Prime Minister Lee Hsien Loong laid out the early missteps his government made in dealing with the coronavirus pandemic this year in a speech Wednesday, warning against relaxing containment efforts too early. “With hindsight, we would certainly have done some things differently,” Lee said in his first major parliamentary speech since winning re-election in July. “I wish we had known earlier that people with COVID-19 were infectious even when asymptomatic.”
/jlne.ws/3jzxzpV

Ethereum miners generated all-time high fee revenue of $17 million yesterday
Yogita Khatri – The Block
Ethereum miners are gaining big as transaction costs or gas fees continue to rise amid decentralized finance (DeFi) boom.
/jlne.ws/3i3OeBm

Bermuda Dives Deeper Into Crypto With Stimulus Coin Test Program
Olga Kharif – Bloomberg
British overseas territory is testing a stimulus stablecoin; Premier Burt has also met with Libra, the Facebook-led group
Bermuda is taking another step toward embracing cryptocurrencies. The North Atlantic chain of islands is testing a digital stimulus token, which can be used to buy food and other essentials. The pilot program was started in July with 20 people and one local shop, and it is being gradually expanded. The stimulus token is a so-called stablecoin, which aims to keep its value from fluctuating much and is backed by bank deposits. The coin, created by the Stablehouse coin clearing firm, was designed https://jlne.ws/32SGyvu

Ethereum Is Eating Bitcoin
Billy Bambrough – Forbes
Ethereum, having long played second fiddle to the number one cryptocurrency, bitcoin, is stepping into the limelight.
The ethereum price, climbing more than 10% over the last 24-hour trading period and adding to gains of all almost 300% so far this year, remains far behind the bitcoin price—but price isn’t everything with the number of bitcoin tokens “wrapped” into ethereum doubling in August.
/jlne.ws/3lFgkoV

Marc Andreessen added as observer to Coinbase’s board of directors
Michael McSweeney – The Block
Crypto exchange company Coinbase revealed several updates to the composition of its board of directors on Monday.
/jlne.ws/3hMDwiJ

Politics

Russians Again Targeting Americans With Disinformation, Facebook and Twitter Say; The companies said the F.B.I. had warned them that the Kremlin-backed Internet Research Agency set up a network of fake user accounts and a website.
Sheera Frenkel and Julian E. Barnes – NY Times
The Russian group that interfered in the 2016 presidential election is at it again, using a network of fake accounts and a website set up to look like a left-wing news site, Facebook and Twitter said on Tuesday.
/jlne.ws/2EIERJg

Facebook says Russian network was behind fake leftwing news; Social network’s latest takedowns also target campaign linked to US public relations firm
Hannah Murphy – FT
Facebook said it has taken down new disinformation campaigns, including one carried out by the Russian group accused of meddling in the 2016 election and another linked to US public relations firm CLS Strategies.
/jlne.ws/2EXbX7W

Facebook takes down Russian operation that recruited U.S. journalists, amid rising concerns about election misinformation; The social media giant acted against a small network of pages and accounts that directed users to a fake left-leaning news site called Peace Data
Elizabeth Dwoskin and Craig Timberg – Washington Post
Facebook removed a network of fake accounts and pages created by Russian operatives who had recruited U.S. journalists to write articles critical of Democratic nominee Joe Biden and his running mate, Sen. Kamala D. Harris, in an apparent bid to undermine their support among liberal voters.
/jlne.ws/3gTLZ2l

Chinese Hackers Targeted European Officials in Phishing Campaign
Natalia Drozdiak – Bloomberg
Cyber-attacks sought information on economies hit by virus; APT TA413 known for targeting Tibetan dissidents, report says
A Chinese nation-state hacker group targeted European government officials, diplomats, non-profits and other global organizations in a phishing campaign designed to gather intelligence about global economies reeling from the pandemic, according to cybersecurity experts.
/jlne.ws/3jDUCjc

German Lawmakers Blame Merkel’s Government for Wirecard Debacle
Sarah Syed – Bloomberg
Greens Paus cites failures at finance ministry, chancellery; Legislators agree to launch full probe into accounting scandal
The main responsibility for the failure to pursue alleged irregularities at Wirecard AG lies with the German finance ministry and Chancellor Angela Merkel’s office was also at fault, according to an opposition lawmaker.
/jlne.ws/2GdXVPI

Trump Claims China Had Thousands More Virus Deaths Than Reported
Jordan Fabian – Bloomberg
He says the country ‘lost tens of thousands of people’; Trump doesn’t provide evidence to back up his claims
President Donald Trump asserted that thousands more people have died from the coronavirus in China than the Beijing government has acknowledged, without citing any evidence. “They lost tens of thousands of people,” Trump said in an interview with Fox News’s Laura Ingraham that was broadcast on Tuesday night. “They lost more than any other country, they just don’t report it.”
/jlne.ws/3i3Or7C

Indonesia Fuels Worries With Plans to Cut Central Bank Autonomy
Grace Sihombing – Bloomberg
Lawmakers seek to expand BI’s mandate, create monetary council; Central bank is already buying bonds to finance fiscal deficit
Bank Indonesia’s independence is coming under threat with proposals from lawmakers to give the government greater sway over monetary policy.
/jlne.ws/31OOAWU

The Border Wall That the U.S., Not Mexico, Is Paying For
Mark Niquette – Bloomberg
From the very start of his campaign for the U.S. presidency, Donald Trump has passionately promoted construction of a border wall between the U.S. and Mexico. Even if it’s not as vast as he once envisaged, or made of concrete as he used to describe it, or financed by Mexico as he famously promised his supporters, Trump can and does cite progress on his signature project. He’s managed to fund it in large part by circumventing Congress, where resistance helped force a record 35-day partial government shutdown in late 2018 into 2019. Funding for the project might stop if Trump is defeated in November by his Democratic challenger, former Vice President Joe Biden.
/jlne.ws/3hRQEmx

Should Freedom of Assembly Be an Absolute Right? From Belarus to Oregon, Germany and beyond, people are taking to the streets. But not all demonstrations are equally deserving of respect.
Andreas Kluth – Bloomberg
The “right of the people peaceably to assemble,” as the U.S. constitution’s first amendment calls it, is one of the pillars of liberty. That’s why all liberal democracies guarantee and protect it in some form. But is this right absolute? Could there be, in well-defined cases, a liberal case for abridging it?
/jlne.ws/3hSJS06

Boris’s Empire Song Sinks Beneath Market Waves; Stocks are selling off as the economy heads toward another Brexit cliff and the prime minister wades into a debate about patriotic anthems.
John Authers – Bloomberg
Britain has moved on from the Brexit debate. One of the passionate political arguments at present is over the songs that should be sung on the Last Night of the Proms, an annual opportunity to wave union jacks and be patriotic. At least two of the songs, from the Victorian era, are a little problematic these days.
/jlne.ws/2QPsc9L

White House Says CDC Will Halt Evictions Using Quarantine Rules
Jennifer Jacobs and Justin Sink – Bloomberg
Agency plans temporary action for those earning up to $99,000; CDC acts as Trump, lawmakers haven’t reached stimulus deal
The Trump administration said it will use its quarantine authority to keep renters in their homes during the coronavirus pandemic as a way to prevent an eviction crisis that could worsen economic strains.
/jlne.ws/3bhpDXs

Mnuchin Talks With Pelosi, Signals Urgency on New U.S. Stimulus
Saleha Mohsin and Erik Wasson – Bloomberg
Treasury chief says some areas of economy still need help; Senate Republicans are moving toward $500 billion skinny bill
Treasury Secretary Steven Mnuchin said the U.S. economy urgently needs additional fiscal stimulus to fully rebound from the Covid-19 crisis, and he initiated a conversation with House Speaker Nancy Pelosi amid stalled negotiations on a relief package.
/jlne.ws/3gT8hkE

Congressional investigation finds over $1 billion in coronavirus aid fraud
Ben Popken – NBC News
Over $1 billion in emergency coronavirus aid relief went to companies that “double dipped” and received multiple Paycheck Protection Program loans in violation of the program’s rules, according to a preliminary analysis released Tuesday by the House Select Subcommittee on the Coronavirus Crisis.
/jlne.ws/2QNU5Pm

Trump Isn’t Here to Serve the People; He has shown that we need new laws to constrain an executive who seeks unchecked power.
Susan E. Rice – NY Times
Desperate to salvage his presidency, Donald Trump is inciting racial violence by encouraging armed vigilantes to confront protesters angry over the killing and maiming of unarmed Black people by the police. The president is stoking civil conflict to distract voters from his failed leadership and strengthen his electoral prospects.
/jlne.ws/2QMERtZ

Regulation

SEC Probes China’s GSX Techedu After Short Sellers’ Pleas; Short sellers accuse New York-listed tutoring company of inflating its sales
Jing Yang – WSJ
GSX Techedu Inc., GSX 10.88% a Chinese after-school tutoring company, said it is being investigated by the U.S. Securities and Exchange Commission after short sellers accused the Beijing-based firm of inflating its sales. The New York-listed company disclosed the probe with its second-quarter results, which were released early Wednesday. GSX said it was contacted by the SEC’s enforcement division and asked to produce financial and operating records dating back to the beginning of 2017. The company added that it is cooperating with the investigation. Its shares fell 15% in premarket trading.
/jlne.ws/333OlqH

SEC Awards Over $2.5 Million to Joint Whistleblowers for Detailed Analysis That Led to Multiple Successful Actions
SEC
The Securities and Exchange Commission today announced an award of over $2.5 million to joint whistleblowers whose tip based largely on highly probative independent analysis of a public company’s filings led to several successful enforcement actions. In addition to their tip, the whistleblowers provided helpful assistance early in the investigation, which helped save Commission time and resources.
/jlne.ws/3jEm4xn

SEC Investor Advisory Committee to Meet Virtually on September 24
SEC
The Securities and Exchange Commission’s Investor Advisory Committee will hold a virtual public meeting on September 24, 2020. The meeting will begin at 10 a.m. ET, is open to the public via live webcast, and will be archived on the Committee’s website for later viewing.
/jlne.ws/3lIpAZu

FINRA’s R&D Program: Exploring the Future of Advanced Analytics
FINRA
FINRA’s Research and Development Program is using advanced analytics to change the way FINRA performs its essential regulatory functions. Feeding off FINRA’s culture of innovation, the R&D program is designed to be quick and agile, hoping to find transformative new technologies, but willing to fail and fail fast when an idea doesn’t work out.
/jlne.ws/32MDzVn

Call for Candidates in the Upcoming FINRA Small Firm Advisory Committee Election
FINRA
The purpose of this Notice is to inform small FINRA member firms1 of the upcoming Small Firm Advisory Committee (SFAC) election. Two seats on the SFAC are up for election, one representing the South region and one representing the Midwest region.
/jlne.ws/3lB6K6q

ESMA sees high risk of decoupling of financial market performance and underlying economic activity
ESMA
The European Securities and Markets Authority (ESMA), the EU securities markets regulator, today publishes its second Trends, Risks and Vulnerabilities (TRV) Report of 2020. A webinar open to the public will be held on 9 September to present the report.
/jlne.ws/32LXfsI

CFTC Charges 20 Entities for Making False Registration Claims
CFTC
The Commodity Futures Trading Commission today announced the filing of charges against 20 entities for making false and misleading claims of having CFTC registration and National Futures Association (NFA) membership required to offer services related to trading in foreign exchange (forex), digital assets, and derivatives. Each complaint seeks orders directing the entities to cease and desist from committing violations of the Commodity Exchange Act and CFTC regulations.
/jlne.ws/2Gl9IMn

Danske Debt Scandal Triggers FSA Probe and Police Scrutiny
Morten Buttler and Frances Schwartzkopff – Bloomberg
Danske Bank A/S is the target of a fresh probe involving the police after it emerged that the lender may have misled Denmark’s financial watchdog about its handling of debt collection errors. The Financial Supervisory Authority has given Denmark’s biggest bank until Sept. 10 to answer a series of questions relating to the case, including exactly when Danske first discovered there was something wrong. Denmark’s economic crime squad, known locally as SOIK, said on Wednesday it is in talks with the FSA regarding the case.
/jlne.ws/3lK0s4o

Switzerland Steps Up Spying Probe Into Its No. 2 Bank
Patrick Winters and Hugo Miller – Bloomberg
Finma starts enforcement proceedings after spying probe; New CEO Gottstein has worked to restore investor confidence
Switzerland’s financial regulator started enforcement proceedings against Credit Suisse Group AG over a spying scandal that led to the ouster of ex-Chief Executive Officer Tidjane Thiam.
/jlne.ws/2YXg4Ig

Swiss open enforcement case against Credit Suisse in spy affair
John Miller – Reuters
Switzerland’s financial supervisor has opened enforcement proceedings against Credit Suisse (CSGN.S) over a spying scandal that led to the ousting of former Chief Executive Tidjane Thiam and tarnished its reputation.
/jlne.ws/3gRUFX9

Investing and Trading

Inflation Is Higher Than the Numbers Say; While government statistics say inflation is low, the reality is that the cost of living has risen during the pandemic, especially for poorer Americans.
Justin Wolfers – NY Times
The latest inflation statistics say prices have risen by only 1 percent over the past year. But there’s something wrong with those numbers because the pandemic has made economic life more expensive in ways the official bean counters aren’t capturing.
/jlne.ws/2YW3Ork

How Shell integrated FX algos into its corporate treasury mix; Interview: oil giant puts up to 50% of spot flows through algos, explains FX head Michael Dawson Shell
Lukas Becker – Risk.net
Back in 2010, the use of algorithms to execute foreign exchange spot transactions was in its infancy, and those dipping their toes into the new world were limited primarily to hedge funds and large asset managers. But a handful of corporates were interested at the time, one being oil giant Shell.
/jlne.ws/3lKxfGu

Active funds fail to outperform passive rivals despite Covid-19 opportunity; Research shows only 44% of active UK large-cap equity funds outdid passive peers in first 6 months
Alf Wilkinson – FT
Actively managed funds failed to outstrip their passively managed counterparts in the wake of the turmoil sparked by the pandemic, despite many active managers touting the turbulence as an opportunity, according to new research.
/jlne.ws/34T63j7

Why Blank Check Companies (SPACs) Are Filling Up Fast
Crystal Tse and Crystal Kim – Bloomberg
Special purpose acquisition company is a boring name for something generating a ton of excitement in financial circles this year. How about “blank check companies” — that’s more appealing. Or the idea of billion-dollar pools of cash, or the chance to buy into promising startups without the uncertainty of an IPO. Put it all together and SPACs sound pretty alluring. So far this year they’ve raised over $30 billion, more than double last year’s $12.4 billion. Whether the format will stick or is just a fad remains to be seen.
/jlne.ws/2YUrtIz

Exxon weighs global job cuts after unveiling Australian lay-off plan
Sonali Paul – Reuters
Exxon Mobil Corp (XOM.N) is assessing possible worldwide job cuts, a spokesman said on Wednesday, after the company announced a voluntary lay-off programme in Australia.
/jlne.ws/2F0E3yR

KKR Knows a Good Monopoly Play When It Sees One; The buyout firm is betting Italy’s broadband network plan will pay off. It could be proven wrong by heavy investment needs and a failure to unite rival fiber providers.
Chris Hughes – Bloomberg
One easy way to lose money in European telecoms has been to invest in Telecom Italia SpA. That’s an inauspicious backdrop to the deal between U.S. buyout firm KKR & Co. and the owner of Italy’s fixed-line phone network. This time the range of outcomes is wide open.
/jlne.ws/3hSK4MS

Investors pour cash into Chinese start-ups in hunt for next Tesla; Electric vehicle makers in the country are raising billions of dollars as demand returns
Christian Shepherd and Peter Campbell – FT
Investors are pumping billions of dollars into China’s electric vehicle start-ups as they seek to turn out the next Tesla, creating a window of opportunity for Beijing to forge a national champion in the industry.
/jlne.ws/3bosxJR

Environmental, Social and Corporate Governance

Does Covid-19 Mark the End of ESG Investing or A New Beginning? (Part III)
TABB Forum
Authors Indranil Ghosh and Shelley Goldberg explain, in this final segment of a three-part series, the important role that government plays in Environmental, Social & Governance (ESG) investing. Besides helping to “de-risk” projects, governments can also set rules so that capital is most effectively channeled into having a sustainable impact.
/bit.ly/34V5WmY

ESG bond funds held back by fear of criticising US, research suggests; Concern that evaluating western governments’ debt is pushing managers into politics
Steve Johnson – FT
Fund managers’ unwillingness to criticise western governments, particularly that of the US, is holding back the development of “sustainable” government bond funds, research suggests.
/jlne.ws/3jCJIu5Take ESG sceptics’ claims with a lorry load of salt; It is nonsense to claim that stakeholder capitalism delivers inadequate returns

Chuka Umunna – FT
Even before Covid-19 hit, there was a growing clamour around the need to integrate environmental, social and governance (ESG) factors into corporate and investment decisions, taking a wider range of stakeholder interests into account. This was intensified by the pandemic and the death of George Floyd, which put social issues and equality under the spotlight.
/jlne.ws/2GlHEZg

Germany Gets $36 Billion of Orders for Its Debut Green Bond
John Ainger – Bloomberg
Europe’s largest economy aims to be benchmark for such debt; Market is beginning to boom with EU aiming to sell green bonds
Germany racked up 30 billion euros ($35.6 billion) of orders for its first green bond as it sets out to dominate the growing market by the end of the year. The price guidance for the 10-year securities was one basis point tighter than the existing conventional bond, according to a person familiar with the sale, who asked not to be identified because they’re not authorized to speak about it.
/jlne.ws/31Qm4nW

ESG Scores Aren’t Enough to Achieve a Net-Zero Future; Investing to match your values is pretty different from picking out the companies best able to survive in a sustainable, climate-aligned world.
Emily Chasan – Bloomberg
Just like in traditional investing, there are dozens of strategies you can use to be an ESG investor. There are funds that pick the best-rated low-carbon companies, funds that focus on companies with more women on boards, and funds that use a series of ratings and checklists to ensure the stocks they are betting on are “better” than the rest of the market.
/jlne.ws/3jy40os

Institutions

Citi becomes first US bank to win custody prize in China; New York-based bank receives licence at a time of rapid growth in mainland funds market
Thomas Hale – FT
Citigroup has become the first US bank to receive a fund custody licence in China, allowing it to provide a core service to global asset managers as they rush to participate in the opening up of the country’s financial sector.
/jlne.ws/3lKkgVg

Ex-Blackstone trader balks at ‘grubby’ terms of Codere debt deal; Hedge fund manager battles over restructuring of Spanish casino operator
Robert Smith and Nikou Asgari – FT
Akshay Shah, the former Blackstone executive who once raked in large profits by persuading Spanish company Codere to default on its debts, is challenging a new restructuring at the casino operator that he says will award “grubby fees” to select creditors.
/jlne.ws/34ZOGNs

Robinhood, Schwab and Other Brokers Resolve Online Glitches
Annie Massa – Bloomberg
Robinhood had problems with stock, options and crypto trading; TD Ameritrade, Vanguard also among those hit by disruptions
Robinhood Markets and three other online brokers said they resolved disruptions on their platforms Monday after a morning of glitches affected thousands of customers. Robinhood, which had problems related to equities, options and cryptocurrency trading, said shortly after noon in New York that the issues were fixed. TD Ameritrade Holding Corp., Vanguard Group and Charles Schwab Corp. also reported difficulties, including slowness with websites and mobile apps, that resulted in user complaints.
/jlne.ws/31PZhse

Regions

Abu Dhabi oil group reaches $5.5bn real estate deal with Apollo; Adnoc to net $2.7bn in upfront proceeds from 24-year lease agreement on rents
Simeon Kerr – FT
Abu Dhabi’s state oil company has sealed a long-term investment partnership with a consortium led by Apollo Global Management, which is taking a 49 per cent stake in the group’s real estate assets valued at $5.5bn.
/jlne.ws/2YZN4PZ

Why Warren Buffett is gambling on Japan’s distinctive dealmakers; Changes in culture may be needed in a sector but one marked overdue for re-evaluation
Leo Lewis and Kana Inagaki – FT
Japan’s sogo sosha — or general trading houses — have a distinctive culture, fierce competitive streak and a horror of being compared to their rivals. One of them is the world’s biggest handler of endangered bluefin tuna; another had its management system forged in a Siberian prison. One has just installed garden swing-chairs to help its executives think; another was responsible for one of history’s worst trading scandals. A fifth has Botticelli’s La Bella Simonetta hanging outside its boardroom.
/jlne.ws/333Acd5

India Has a New Plan to Tackle $140 Billion in Bad Loans
Suvashree Ghosh and Jeanette Rodrigues – Bloomberg
India has rolled out a fresh plan to tackle an old problem: the mountain of bad loans held by its banks. With the pandemic forecast to push soured assets to a two-decade high, Prime Minister Narendra Modi is struggling to find cash to support the state-run lenders that hold most of it, and to spur credit to a shrinking economy. Most of the risky debt is concentrated in two sectors — telecoms and utilities — that are vulnerable to the economic slowdown, meaning if they face more trouble, then a massive amount of debt goes bad.
/jlne.ws/2YVwLDG

Saudi Cutting Oil Deliveries to U.S. as It Tightens Supply
Brian Wingfield and Sheela Tobben – Bloomberg
U.S. imported 51k b/d of Saudi crude last week: cargo data; Flows have dwindled as kingdom seeks to tighten global supply
Saudi Arabia is continuing to divert its oil away from America’s shores. The kingdom last month loaded about 5.6 million barrels a day on to tankers, a small increase from July, vessel-tracking information compiled by Bloomberg show. Within that, an ever-smaller share went to the U.S., and cargo data show that deliveries in the week ended Aug. 28 dropped to what could be the lowest in decades.
/jlne.ws/32SYUMS

Trader Fat Finger Blamed for Accidentally Selling 5 Million Company Shares
Bloomberg News
Sale was made by a trader managing chairman’s account; Li Dongsheng issued an apology Wednesday on social media
The chairman of TCL Technology Group Corp. said a trader accidentally sold 5 million company shares using his account — an incident that comes as the stock nears a record high. The sale was made at 1:03 p.m. Tuesday by a trader managing chairman Li Dongsheng’s accounts who had typed in the wrong stock code, the Guangdong-based panel maker said in a filing to the Shenzhen exchange. Li bought back the shares for 35.8 million yuan ($5.2 million) less than two hours after the trader sold them for 35.9 million yuan, the firm said. He will hand over profits from the trade to the company, the statement added.
/jlne.ws/2YSE3s3

Australian Firms Tout Private Credit After Pandemic Drives Down Yields
Andreea Papuc and Adam Haigh – Bloomberg
Revolution Asset says its secure debt strategy returns 6%; FIIG says family offices show more interest in private debt
Australian asset managers reported growing interest in the private-credit market from institutions and family offices seeking income after the pandemic drove down yields on traditional investments.
/jlne.ws/3lHD6g4

Wheat King Russia Is Missing Out on China’s Buying Spree
Anatoly Medetsky – Bloomberg
China has boosted wheat imports to ensure food security; Major Russian growing areas are banned from selling to China
Despite ramping up wheat purchases from around the globe, China remains one of the few main markets that Russia is struggling to crack. China’s imports are expected to climb to a seven-year high this season — almost doubling in just two years — as the country tries to secure food supplies amid a recovery in the domestic economy following coronavirus lockdowns. While that’s good news for shippers like France and Australia, Russia can only supply small amounts, mainly because China bans most Russian wheat over fungus concerns.
/jlne.ws/2YTPcZy

China cracks down on waste to ensure food security; Xi Jinping launches ‘operation empty plates’ in face of virus, floods and trade tensions
Christian Shepherd – FT
China’s “champion eaters” have attracted a dedicated following for their ability to gobble down vast quantities of food. Swallowing eye-popping volumes of fried chicken, instant noodles and hot dogs have made these gluttons internet stars.
/jlne.ws/3bishMB

Brexit

UK’s euro clearing access to EU requires careful analysis post Brexit: ECB official
Huw Jones – Reuters
Detailed analysis is needed before the European Union can decide on long-term access for the London Stock Exchange (LSE.L) to clear euro denominated derivatives for customers in the bloc, a European Central Bank official said on Wednesday.
The LSE dominates euro derivatives clearing and EU policymakers have called for the activity to be relocated to the bloc given that Britain will no longer have to comply with EU rules after Dec. 31 when a post-Brexit transition period ends.
/jlne.ws/3lFgM6B

U.K. Stocks Care About Brexit Cliff, Not Johnson’s Proms; Stocks are selling off as the economy heads toward another Brexit cliff and the prime minister wades into a debate about patriotic anthems.
John Authers – Bloomberg
Britain has moved on from the Brexit debate. One of the passionate political arguments at present is over the songs that should be sung on the Last Night of the Proms, an annual opportunity to wave union jacks and be patriotic. At least two of the songs, from the Victorian era, are a little problematic these days.
/jlne.ws/3lHbPdo

Brexit: Britain begins to ‘chart new course as an independent coastal state’; Britain’s future as an independent coastal state has moved one step closer after MPs backed a post-Brexit plan for waters and fisheries management.
Daniel O’Donoghue – The Press and Journal
Britain’s future as an independent coastal state has moved one step closer after MPs backed a post-Brexit plan for waters and fisheries management.
/jlne.ws/3gVwarU

Miscellaneous

A “Corn Moon” rises tonight — and it only happens every 3 years
Sophie Lewis – CBS News
The final full moon of the summer rises bright in the night sky on Tuesday. Known as the “Corn Moon,” it only happens once every three years. September’s full moon was given its name by the Algonquin tribes living in the northeastern U.S., according to The Old Farmer’s Almanac. They named it for the time of year when they harvested staple crops like corn, pumpkins, squash, beans and wild rice.
/jlne.ws/2QLhdxQ

Hottest season on record: Merciless Phoenix heat blasts by all-time monthly, summer milestones
Ian Livingston – Washington Post
Phoenix has relentlessly baked for months. In July, it clinched its hottest month on record. Then August topped that and became the new hottest month.
/jlne.ws/3hRTh7T

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