JLN REPORTS ON FIA IDX-V DAY TWO
FIA IDX-V: ‘No Victory Laps,’ But Systems Clear Amid Pandemic-Infused Volatility
By Suzanne Cosgrove – John Lothian News
The global pandemic provided European markets with their first major test since the implementation of financial reforms that followed the 2008-2009 financial crisis, a challenge they met despite “stress on all of the markets, all of the time,” said Daniel Maguire, CEO of LCH Group and group director, post trade division, of LSEG.
To read the rest of this report, go here.
Brent Crude: Global Benchmark
By Thom Thompson – John Lothian News
The closing session of IDX-V Day 2 offered ICE pumping its own oil in the form of an infomercial (“sponsored session”) about ICE Brent crude futures. The two-person session had Chris Edmonds, ICE Global Head of Clearing and Risk, as master of ceremonies, and ICE Head of Oil Market Research Mike Wittner as the sole other speaker.
To read the rest of this commentary, go here.
Lessons Learned in Real Time
By John Lothian
At the end of the IDX-V session on the lessons learned Wednesday, just after Chris Smith from LME mentioned the importance of infrastructure for working from home, my internet failed.
FIA’s Don Byron, who moderated the panel, had mentioned how when the movie Frozen II came out, the telecom companies mentioned it had slowed down the internet globally, as well as the last mile.
To read the rest of this report, go here.
Hits & Takes
By John Lothian & JLN Staff
I was told tonight by a source in Singapore that the John Lothian Newsletter is very popular in Hangzhou, China. Hangzhou has a lot of English speakers and is the true finance center of China. JLN gives them a window into the west and the commodities markets that are so important to China.
This gives me a good segue to our plans for a new demographic study JLN will be conducting. But before we do the study, I would like to ask another favor. For any and all readers outside of Chicago and particularly the U.S, would you send me an email and tell me your location?
Also, if you would be so kind, please offer a testimonial of why you subscribe or read JLN. Even if you are not a subscriber, but somehow receive JLN, please offer your location and a short testimonial. We would like this anecdotal information and the testimonials to be able to offer our sponsors insight into the audience we are reaching and the reasons why people use our services. Click HERE to email me with your location and short testimonial.
Today is the third day of FIA’s IDX-V and the virtual hangovers are terrible. Too many virtual Guinesses last night with the crew at the virtual pub. Today, I am wearing my “Pork Belly & The Outtrades” t-shirt I bought a couple of years ago at the gala dinner. I also bought a framed box that includes all the Game of Thrones books, a map of Westeros and the Free Cities and a signature of authenticity from George RR Martin to support Futures For Kids. The framed Game of Thrones box is on the wall in my office, just above where I sit and write this newsletter.
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Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
The U.S. Senate Committee on Banking, Housing and Urban Affairs is set to discuss the “digitization” of money and payment systems on Tuesday, June 30. A number of notably pro-cryptocurrency and blockchain figures will be there, including former CFTC Chairman J. Christopher Giancarlo and Charles Cascarilla, CEO and co-founder of Paxos, creator of the PAX stablecoin.~MR
Chris Hehmeyer: An Endorsement of the Crypto World Like None It’s Ever Seen
By John Lothian
The crypto world received a large and powerful endorsement yesterday from a pillar of the futures world. Chris Hehmeyer, in a blog post where he announced the reasoning for rebranding his firm from Hehmeyer Trading + Investments to just Hehmeyer, gave the crypto world a boost it had never before seen.
He is the highest ranking member of the futures world to wholly embrace the crypto world, giving it a jolt of integrity, honesty and legitimacy.
To read the rest of this commentary, go here.
Hehmeyer Trading + Investments Rebrands as Hehmeyer; The change in branding reflects the firm’s shift in business to algorithmic trading and market making in the digital asset space
Hehmeyer Trading + Investments, a Chicago-based trading firm, today unveiled its new brand, Hehmeyer. This rebrand coincides with the evolution and consolidation of the company’s business segments solely into algorithmic trading and market making in cryptocurrencies.
******Hehmeyer is now the Madonna of the crypto world, a single name everyone knows.~JJL
The New Hehmeyer
Written from the perspective of Hehmeyer CEO Chris Hehmeyer.
There were three moments in my career that made me stop what I was doing in wonderment, moments that gave me firm direction as to where I would take the next steps in my career.
*****Chris Hehmeyer never seems to age, so I am not sure what this new Hehmeyer will look like.~JJL
GOP’s Devin Nunes Can’t Sue Twitter Over Tweets by Fake Cow
Robert Burnson – Bloomberg
California Republican Congressman Devin Nunes can’t sue Twitter over the tweets of a fake cow and others that mock him relentlessly on the social media platform. A judge in Virginia, citing a law loathe to Republicans, on Wednesday dropped Twitter from Nunes’s lawsuit, noting that Section 230 of the federal Communication Decency Act grants social media networks immunity from liability for the posts of their users.
Wednesday’s Top Three
Our top story Wednesday was the Bloomberg Opinion piece Day Traders Will Have Fun Until They Get Wiped Out. Second was The City of London Has a Slavery Problem, also from Bloomberg. Third was John Lothian’s post of some remembrances of Mark Thornberry, who died at the age of 59 from liver cancer.
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Veteran Commodities Trader Chris Hehmeyer Goes All In on Crypto
Nikhilesh De – Coindesk
Hehmeyer Trading + Investments, the commodities investment firm, is pivoting to crypto full-time. The Chicago-based company, which began offering cryptocurrency services in 2017, will now focus solely on being a market maker and algorithmic trader in the space, rebranding to Hehmeyer in the process.
Investors Are Favoring Firms That Let People Work From Home
Ayai Tomisawa – Bloomberg
AllianceBernstein, Dai-ichi Life ask firms about virus steps; Virus is ‘litmus test’ to judge companies: AllianceBernstein
Some fund managers are increasingly basing investment decisions in part on how considerate companies are to their employees and clients during the coronavirus pandemic. Did firms move right away to let their staff work from home? Did they continue paying contract employees who had to stop working? Are they offering flexibility for clients who can’t pay bills on time? More and more, investors such as Dai-ichi Life Insurance Co. and AllianceBernstein Holding LP are asking questions like those when considering where to park their money.
Cboe to challenge CME and Refinitiv with new FX platform; Chicago-based group is trying to break dominance of EBS and Matching in $6.6tn market
Eva Szalay – FT
Exchange group Cboe Global Markets is launching a new currency trading platform, attempting to break the stranglehold of CME Group and Refinitiv in the $6.6tn-a-day market.
Cboe launches FX central limit order book; Liquidity providers will be rewarded with faster access to market data when quoting at the best bid or offer via the new FX central limit order book from Cboe.
Hayley McDowell – The Trade
Cboe Global Markets has confirmed plans to launch a new central limit order book for FX trading in a move that will see the exchange group compete with the likes of Refinitiv and CME Group. Known as Cboe FX Central, the platform has been designed as an all-to-all market with firm liquidity for instant executions. It will initially offer trading in the most actively traded pairs in spot FX, and will go live on 29 June.
Europe Is Approaching a Disastrous Economic Cliff Edge
Joao Lima – Bloomberg
Some job protections due to roll off amid unsteady recovery; Portugal’s layoff program changes in just over a month
In northern Portugal, Tiago Carvalho is nervously counting the days until his business has to stand on its own two feet again. The restaurant owner in Braga, home to the country’s oldest cathedral, says revenue is less than a third of what it was before the coronavirus kept tourists away and confined locals to their homes. Even with lockdown restrictions largely rolled back, customers have stayed away, reflecting the slow pace of recovery across Europe.
Eventus sees 20-30 European clients in 12 months
Luke Jeffs – FOW
US surveillance firm Eventus Systems plans to multiply its European client base over the next 12 months to as many as 30 clients after it signed on Tuesday INTL FCStone’s European arm. Eventus has said it already has some clients in Europe but it wants its regional client list to increase significantly over the next year as the firm moves aggressively into the market.
Turkey’s War Against the Markets:; What you need to know
Rodney Jefferson – Bloomberg
From state institutions to the media, President Recep Tayyip Erdogan tightened his grip on just about everything in Turkey since a failed coup against him in 2016. The one force he couldn’t seem to rein in was the free market.
LSEG names new chief financial officer; Johnson Matthey’s finance chief Anna Manz will join LSEG in November in the same role as David Warren prepares to retire.
Kiays Khalil – The Trade
The London Stock Exchange Group (LSEG) has confirmed that an executive director at Johnson Matthey will become chief financial officer as David Warren retires from the role. Anna Manz will join the firm as chief financial officer on 21 November reporting directly to David Schwimmer, CEO of LSEG. She joins the exchange group from Johnson Matthey where she headed up finance, procurement and IT functions as CFO.
Don’t Repeat This Crisis Error Once Dark Hours Pass; Some policy makers in Asia are wavering on extending stimulus. They should resist the temptation to end support too early.
Daniel Moss – Bloomberg
Welcome to the first truly global recession of the modern era. The pandemic disrespects national borders and is contemptuous of differences between regions and levels of economic development. Unlike in the global financial crisis and the trough that followed the 2001 terrorist attacks in the U.S., all regions are suffering contractions. Asia’s policy makers need to remember that when plotting the path ahead as economies emerge from lockdowns.
Scotland Should Start a Sovereign Wealth Fund; Standalone investment vehicles would be the best way for nations to channel their state aid into equity holdings.
Mark Gilbert – Bloomberg
Scottish leader Nicola Sturgeon has navigated her own course in dealing with the aftershocks of the novel coronavirus. In pursuing what she calls an “interventionist approach” to the pandemic thrashing the economy, she’d be wise to consider creating a sovereign wealth fund to build a trust fund for her nation.
A second senior economist is abruptly leaving the White House amid ongoing economic crisis; Tomas Philipson announced he is stepping down two days after Kevin Hassett announced his departure
Robert Costa, Ashley Parker, Josh Dawsey and Jeff Stein – Washington Post
One of President Trump’s senior economic officials has abruptly left the White House in the middle of the economic crisis caused by the coronavirus pandemic. He becomes the second senior White House economic official whose departure was announced this month.
Minnesota Sues Exxon, Koch Over Climate Change; Lawsuit is latest targeting oil industry over global warming, efforts that have been unsuccessful so far
Christopher M. Matthews – WSJ
The Minnesota attorney general sued Exxon XOM -4.71% Mobil Corp., Koch Industries and a top oil-and-gas trade group Wednesday, alleging they have for years deceived consumers about the effects of climate change.
Stock-Market Surge Masks Volatility in Individual Sectors; Energy sector, set for best quarter on record, is on cusp of bear market
Caitlin McCabe – WSJ
The S&P 500 is on track for its best quarter since 1998, but despite the dramatic rebound, many sectors are still struggling to find steady footing. The index’s consumer discretionary and energy segments are both on pace for their best quarterly performances on record, according to Dow Jones Market Data. Records for both date to the fourth quarter of 1989.
US capitalism has been shattered; The coronavirus response is paving a path to government control of the economy
Henry Kaufman – FT
American capitalism is rapidly disappearing. Its demise has been under way for some time and the economic devastation wrought by the Covid-19 pandemic is the latest blow to our political economy.
Germany’s Virus Infection Rate Drops to Lowest in Almost 3 Weeks
Andrew Blackman – Bloomberg
Germany’s coronavirus infection rate fell to the lowest in almost three weeks, while the number of new cases remained well below the level at the height of the outbreak.
Did Trump Really Slow Down Coronavirus Testing? It almost certainly doesn’t matter whether the president gave a formal order. His influence has been severely diminished.
Jonathan Bernstein – Bloomberg
There’s a bit of a mini-scandal underway about whether President Donald Trump deliberately slowed down coronavirus testing. Trump said he did so during a rally in Tulsa on Saturday, and has frequently said that he opposes added testing because it produces worse statistics. Then the White House said that he was kidding. Then Trump said on Tuesday that he doesn’t kid.
Delta CEO: 500 Staff Tested Positive For Coronavirus, 10 Dead
Danny Wicentowski – Yahoo News
Ten employees of Atlanta-based Delta Air Lines have died from coronavirus, and some 500 employees have tested positive, the company has revealed.
U.S., EU Discuss Restarting Travel After Bloc Considers a Ban
Nick Wadhams – Bloomberg
Pompeo says he’s confident two sides can find solution; EU weighing restrictions on Americans when travel resumes
Secretary of State Michael Pompeo said the Trump administration is working with the European Union over how to restart travel suspended by the Covid-19 pandemic, even as the bloc weighs whether to exclude Americans from an initial reopening plan.
America’s Pandemic Failure Makes It an Outcast; In the end, coronavirus built the wall.
Mark Gongloff – Bloomberg
America: Pariah State
President Donald Trump came to office promising to build a wall around to America to keep foreigners out. He may leave it with foreigners building walls to keep Americans out. The coronavirus pandemic is surging in many parts of the world and threatens to rebound in many more. But one of the globe’s worst hot spots is the U.S., thanks to slapdash pandemic management that basically leaves each state to fend for itself, and not always well. So today you have the governors of New York, New Jersey and Connecticut, with their worst outbreaks hopefully behind them, announcing (probably unenforceable) quarantines for travelers from America’s new disaster zones, of which there are too many.
Virus Spread Spells Peril for Trump Campaign
Kathleen Hunter – Bloomberg
For a president banking on the support of his base in the American heartland, the news is getting worse. The resurgence of the virus is posing a renewed political challenge for Donald Trump, who has made his push for a swift economic re-opening a centerpiece of his pandemic response.
The Lasting Normal for the Post-Pandemic City; Coronavirus has altered the look and feel of cities globally, but only some changes will remain when the crisis is over.
Richard Florida – Bloomberg
Two images of the post-pandemic city have emerged. One is the urbanist’s utopia of widened sidewalks, ample bike lanes, parking lots converted to green spaces and extended networks of pedestrianized boulevards. The other is a dystopia of empty streets and boarded-up shops, a barren cultural landscape in which the diversity, energy, and pageantry of Barcelona’s La Rambla, Paris’s Champs Elysees, London’s Piccadilly Circus, and New York’s Times Square have been replaced by a tableau of socially-distanced and masked citizens, scurrying quickly between their jobs and their homes.
Chinese Covid-19 Vaccines Cleared for Final Testing in U.A.E.
China National Biotec Group gets U.A.E. approval for testing; World’s fast-moving shots approach final stage of trials
A Chinese state-owned vaccine developer secured regulatory approval to test its coronavirus shots in the United Arab Emirates, making it one of the first among a slew of global efforts to get the greenlight for the final stage of human trials.
U.S. Rebuffs China, Rejecting Links Between Covid and Food
Mike Dorning – Bloomberg
USDA, FDA say there’s no evidence people get virus from food; Export curbs aren’t in line with ‘science of transmission’
U.S. health and agricultural authorities issued thinly veiled criticism of new demands from China for food-exporting companies to sign documents stating that they comply with safety standards to prevent transmission of Covid-19.
California’s Newsom Rejects Another Lockdown With Virus Surging
David R. Baker – Bloomberg
California Governor Gavin Newsom urged residents to recommit themselves to slowing the spread of the coronavirus as cases climb by record numbers, while stopping well short of halting efforts to restart the state’s economy.
140,000 Businesses Listed on Yelp Are Still Closed Because of Covid-19 Pandemic; Retailers and restaurants are hardest-hit, but there is surge in searches for black-owned businesses
Matt Grossman – WSJ
The majority of businesses that closed during the Covid-19 pandemic remained shut this month as the crisis continued to upend commerce, according to data from review site Yelp Inc.
Coping With Covid-19; Flare-ups are inevitable but new lockdowns aren’t the answer.
The Editorial Board – WSJ
Fears of a resurgence of the novel coronavirus are dominating the news and spooking financial markets. The flare-ups bear watching, and preparing for, but the original lockdowns were never going to eradicate the virus short of unacceptable economic pain. The unhappy but inevitable truth is that Americans will have to learn to cope with the virus, which means trial and error and more individual responsibility.
Exchanges, OTC and Clearing
Cboe FX to Launch Central Limit Order Book for FX Market
Cboe Global Markets
Cboe FX Central, a new central limit order book, aims to bring competition and innovation to the FX “primary” markets; Cboe FX Central brings to market a unique market model designed to incentivize and democratize FX liquidity provision and market data; Cboe FX Central scheduled to launch on Monday, June 29, 2020
Cboe FX Markets, a Cboe Global Markets, Inc. (Cboe: CBOE) company and a leading platform for institutional foreign exchange (FX) trading globally, today announced plans to launch Cboe FX Central, a new central limit order book (CLOB) designed to bring competition and innovation to the FX market.
ICE expands ETF Hub authorised participants with Wells Fargo; Wells Fargo joins several other major institutions as an authorised participants on the ICE ETF Hub, including Goldman Sachs and Citadel Securities.
Hayley McDowell – The Trade
US exchange group ICE has confirmed that Wells Fargo has become the latest major institution to become an authorised participant within its exchange traded funds (ETF) ecosystem.
Eurex Clearing welcomes new members to the Supervisory Board; Three new Supervisory Board members appointed
The five most active participants in the Eurex Clearing Partnership Program continue to hold seats; As of today, the Supervisory Board of Eurex Clearing, one of the largest clearing houses globally and part of Deutsche Börse Group, welcomes three new members.
Tammo Diemer, Managing Director at the Federal Republic of Germany Finance Agency GmbH, will succeed Jutta Dönges.
LSEG Appoints Anna Manz as Chief Financial Officer
London Stock Exchange Group
London Stock Exchange Group (LSEG) announces today that Anna Manz will join as Chief Financial Officer and a member of the Board of LSEG plc on 21 November, reporting to David Schwimmer, CEO, LSEG. She succeeds David Warren who announced in October 2019 his intention to retire from the Group and to step down from the Board by the end of 2020. David Warren will step down as Chief Financial Officer and Executive Director when Anna starts, remaining with the Group until his retirement date of 24 June 2021 to ensure a seamless transition.
Vienna Stock Exchange: VÖNIX Sustainability Index Is Celebrating 15 Years
Since the beginning of the week, the VÖNIX, one of the first national sustainability indices worldwide, has a new composition: Raiffeisen Bank International AG was newly included in the index. The VÖNIX is now entering its 16th index year and is thus a sign of the sustainability that is lived in Austria. It includes those companies listed on the Vienna Stock Exchange that are leaders in ecological and social activities and services. The calculation and distribution is carried out by Vienna Stock Exchange.
Industry pioneers Eventus Systems and VoxSmart Ltd. form strategic alliance in global markets surveillance; Firms offer market participants holistic trade and communications surveillance solution
Eventus Systems, Inc.
Eventus Systems, Inc., a multi-award winning global trade surveillance and risk management software platform provider, and VoxSmart Ltd., a global leader in communications surveillance technology, announced today that they have formed a strategic alliance. The firms are collaborating to build custom solutions for global market participants looking to enhance their ability to surveil and manage risk across the entire order and trade lifecycle, from pre-trade communications to execution and post-trade monitoring.
‘Companies have no choice.’ The pandemic is forcing business to digitize
Michal Lev- Ram – Fortune
The novel coronavirus pandemic has wreaked havoc on much of the world. But it might result in at least one positive outcome for companies that have been slow to digitize: a forced acceleration of that transformation.
BIS Encourages Central Banks To Continue Adapting To The Challenge Of Digital Payments
Rapid reshaping of payment services requires central banks to keep evolving as they support the safety and integrity of the payment system; Changes are generating interest in central bank digital currencies (CBDCs), which deserve consideration as additional means of payment; Covid-19 has spurred contactless payments while highlighting shortcomings in payment systems, especially for the poor and unbanked.
Central banks, as guardians of the safety and integrity of the payment system, must keep evolving to meet the challenge of rapidly accelerating digital innovation, the Bank for International Settlements (BIS) writes in its Annual Economic Report.
Wirecard’s Wild Week Finally Ends in Insolvency Filing
Sarah Syed, Luca Casiraghi, and Fabian Graber – Bloomberg
Management cites company over-indebtedness in documents; Company files for protection after $2.1 Billion went missing
Wirecard AG filed for insolvency, the culmination of a stunning accounting scandal that led to the arrest of its CEO and left the German payment-processing firm unable to find over $2 billion missing from its balance sheet.
Quant Insight launches Quant Analytics Platform on OpenFin
Quant Insight (Qi), the macro data analytics firm that applies innovative quantitative techniques to financial markets, today announced the firm has launched their desktop application on OpenFin, the operating system of finance. Qi provides quantitative macro analytics across multiple asset classes to a wide array of investors from discretionary to systematic, from equity long/short to absolute return. Qi brings a single, comprehensive and robust solution to its clients with actionable signals.
Crypto Trust’s 50% Price Collapse Highlights Liquidity Hazard
Olga Kharif – Bloomberg
Grayscale Ethereum Trust has tumbled more than 50% this week; Net asset value premium had surged more than 800% since launch
Cryptocurrency enthusiasts are getting a reminder of the risks that remain in digital assets even while using structured investment vehicles. The price of the Grayscale Ethereum Trust, which invests in the the world’s second-largest cryptocurrency, has tumbled more than 50% this week even though the value of the token has increased slightly.
How to Spot a Crypto Scam
John Biggs – Coindesk
You’ve seen it before: A site that promises instant returns on your small crypto investment. It looks legitimate with all the happy customer testimonials, FOMO-inducing promises and easy-to-use dashboards that look like so many other financial sites. The language is open, breezy but sometimes, well, odd. One site, Coindeskminers.com especially piqued our interest because it used a derivative of our brand without our knowledge, much less consent.
Blockchain Will Let You Track Salmon From Sea to Dinner Plate
Agnieszka de Sousa – Bloomberg
Norway’s fish suppliers partner with IBM to track life of fish; People want to know more about how their food is produced
Consumers around the world will soon be able to know intricate life details of the salmon they eat with a new blockchain initiative from top exporter Norway.
Germany Wonders How Wirecard Could Misplace $2 Billion; The fintech darling was supposed to revive the German tech sector but got dragged down by financial improprieties.
Sarah Syed, William Canny, Eyk Henning – Bloomberg
The question everyone in the German business world is asking these days is as simple as it is perplexing: How, exactly, do you misplace more than $2 billion? That’s the mystery surrounding Wirecard AG.
METACO SA And Frankfurt School Blockchain Center Form Strategic Partnership – Partnership Underlines Joint Commitment To Transforming The Financial Services Industry
METACO SA, the leading provider of security-critical infrastructure enabling financial institutions to enter the digital asset ecosystem, has formed a strategic partnership with Frankfurt School Blockchain Center (FSBC), the think tank and research center which investigates implications of the blockchain technology, crypto assets and distributed ledger technology (DLT) for companies and their business models.
The COVID-19 E-Commerce Boom Hasn’t Trickled Down to Bitcoin, Despite Advantages
Leigh Cuen – Coindesk
Despite the COVID-19 e-commerce boom, bitcoin is hardly seeing more merchant usage as a transactional currency than it was five years ago. “We’ve been doing this for six years and it’s still very rough around the edges,” said Brian Hoffman, co-founder of OB1, maker of crypto marketplace app Haven and its desktop counterpart, OpenBazaar. The Haven app has logged 30,000 downloads since launching in July 2019. Since there’s a fine line between open commerce and bitcoin-fueled black markets, Hoffman said compliance costs are a chief concern for his startup. Any seller can list any item using the open-source protocol, but only compliant offerings get picked up by OB1’s search engine.
Libra-like stablecoins could improve consumer welfare in certain cases, Fed researchers find
Saniya More – The Block
Facebook’s proposed Libra digital currency has alarmed policymakers around the world who say central banks should control any global currency. But such “basket-backed” stablecoins could improve consumer welfare in certain economic scenarios, according to a recent research paper from the U.S. Federal Reserve. In March, former Bank of England governor Mark Carney proposed a central bank-run system that sounded a lot like Libra in that it would be backed by a basket of different currencies. He called it a “synthetic hegemonic currency.”
New York Moves to Lure Crypto Startups as BitLicense Turns Five
Nikhilesh De – Coindesk
Five years after throwing up a wall around its market few crypto startups could scale – a wall known as the BitLicense – New York is handing down a ladder. The New York Department of Financial Services (NYDFS) said Wednesday it will consider issuing conditional licenses under which startups would be allowed to partner with existing licensed entities to begin operations in the Empire State.
Kleiman Bitcoin Case Heads to Trial as Motion for Sanctions Against Craig Wright Is Denied
Sebastian Sinclair – Coindesk
Divisive crypto industry businessman Craig Wright is heading to a jury trial in a case that revolves around billions of dollars in bitcoin. The move to trial comes after the legal team for the estate of David Kleiman, Wright’s deceased former business partner, were denied an omnibus motion filed in May attempting to sanction Wright over his alleged misbehavior.
CBDC Issuance Is ‘Not a Reaction’ to Libra, Says Central Bank Body
Danny Nelson – Coindesk
The Bank for International Settlements (BIS), the so-called bank for central banks, rejected the popular narrative that private sector stablecoin proposals (read: Libra) have been key in spurring the issuance of central bank digital currencies (CBDC) in a report published Tuesday.
Government of Monaco teams up with Tokeny to oversee tokenization projects
Yogita Khatri – The Block
Monaco’s Ministry of State has partnered with Tokeny to ensure control and compliance of tokenization projects in the tiny European country. Tokeny announced the news on Thursday, saying that the ministry wants to support the financing of projects that are focused on environmental impact. The Monaco government recently passed a bill that allows projects to fund themselves via issuing tokenized securities. The full regulatory framework is yet to be announced.
Coinbase Bring USDC Stablecoin to Algorand’s Blockchain
Nikhilesh De – Coindesk
The CENTRE consortium, led by Coinbase and Circle, announced on Thursday that its U.S. dollar-backed stablecoin, USD Coin (USDC), would be launched on the Algorand blockchain as part of a new collaboration with the Algorand Foundation.
Venezuela tests Bitcoin payments for some passports
Jose Antonio Lanz – Decrypt
Venezuela introduced an option to pay in Bitcoin for passports. The option was only available for some applicants outside the country for a brief time, suggesting it was run as a test. Enabling Bitcoin payments for official state business could be a way to mitigate the effects of US sanctions.
Hacker Group Stole $200 Million from Crypto Exchange
Arnab Shome – Finance Magnates
A single cryptocurrency hacking group is targeting exchanges and wallets for the past couple of years and managed to rake more than $200 million, Israeli cybersecurity firm ClearSky claimed. Though the actual identity of the hacking group is not known, a report published by the cybersecurity firm on Wednesday, detailed that it is clear from the profile, modus operandi, and digital infrastructure of the attacks that it was the single group.
Four More Years of Trump Is Too Much for America’s Allies; A Q&A with Mira Rapp-Hooper on how China and Russia are looking to shatter the U.S.-led global order.
Tobin Harshaw – Bloomberg
Many Americans feel that November’s presidential election will be one of the most important ever for the future of the Republic. Well, in truth, every presidential election is one of the most important ever for the future of the Republic. What will set it apart is that it’s one of the most important for the future of America’s allies.
Political Donors Linked to China Won Access to Trump, GOP; Hundreds of thousands of dollars in political donations opened doors in Washington for Chinese nationals with high-level ties
Brian Spegele – WSJ
Soon after Donald Trump took office, people with ties to the Chinese state poured hundreds of thousands of dollars into his re-election bid to get close to and potentially influence the new president. The effort had early success in gaining access for those involved, helping them meet the president or top Republicans at fundraisers or at an internal GOP leadership meeting. It reveals how China seeks to build inroads into U.S. politics, gather information on U.S. leaders and if possible affect policy-making.
Elites in Beijing see America in decline, hastened by Trump; But they are not sure whether it would suit China for Trump to be re-elected
Whom would China prefer as America’s next president? That is a hard question, without an uplifting answer. In elite circles in Beijing, both President Donald Trump and his rival, Joe Biden, a former vice-president, are spoken of with distrust and condescension. Rather unusually, both candidates are known quantities. Each man has spent many hours with President Xi Jinping. During the first term of the Obama administration, when Mr Xi was heir-apparent to the leadership of China with the formal rank of vice-president, Mr Biden, as his opposite number, was tasked with taking his measure. Visiting China in 2011, Mr Biden hailed their numerous meetings in various countries and their “mutual respect”.
Blackstone’s Tony James Hosts Fundraiser for Biden
Jennifer Epstein – Bloomberg
Biden seeks to balance Wall Street with progressives’ demands; James is seen as a potential member of a Biden administration
Blackstone Group Inc. Executive Vice Chairman Tony James hosted a small, high-dollar fundraiser for Democratic nominee Joe Biden on Wednesday. James and his wife, Amabel, led the virtual event for 30 donors with Biden, who’s been appearing nearly daily at fundraisers before the end of the quarter next week. Biden has been seeking to balance his efforts to raise hundreds of millions of dollars for his campaign from wealthy donors with the policy concerns of progressives who hope to see him enact tough rules on Wall Street if elected.
Pentagon Names 20 Chinese Firms It Says Are Military-Controlled
Anthony Capaccio and Jenny Leonard – Bloomberg
Huawei, Hikvision and Panda Electronics are on the list; Relations with China have become a U.S. election-year issue
The Pentagon unveiled a list of companies it says are owned or controlled by China’s military, opening them to increased scrutiny in the latest spat between the world’s biggest economies.
WikiLeaks Assange Accused of Conspiring With ‘Anonymous’ Hackers
Edvard Pettersson – Bloomberg
WikiLeaks founder Julian Assange conspired with hackers affiliated with the “Anonymous” and “LulzSec” groups, which have been linked to numerous cyber attacks around the world, according to new indictment by the U.S. Justice Department. Assange, who’s detained in the U.K. on a U.S. extradition request, gave the leader of LulzSec a list of targets to hack in 2012 and told this person that the most influential release of hacked materials would be from the Central Intelligence Agency, National Security Agency or the New York Times, according to a statement Wednesday from the Justice Department.
Trump is not just in denial but also indifferent to an unfolding American tragedy
Stephen Collinson, CNN
It’s a “public health train wreck in slow motion,” in the words of one health expert, and the best President Donald Trump cares to offer the thousands more Americans projected to shortly die of Covid-19 is the unsubstantiated prospect of a “beautiful surprise.”
White House National-Security Adviser Warns of China’s Bid to ‘Damage Our Economies’; Robert O’Brien, in remarks unusual for typically low-key member of president’s team, says days of U.S. passivity regarding Beijing are over
Gordon Lubold – WSJ
White House national-security adviser Robert O’Brien added his critical voice to the Trump administration’s growing condemnation of Beijing on Wednesday, calling China’s Communist Party a threat to the sovereignty and the economies of the U.S. and its allies.
Ocasio-Cortez overcomes Wall Street foes to win primary; Other New York races pitting progressives against veteran incumbents are too close to call
Lauren Fedor – FT
New York’s Alexandria Ocasio-Cortez has won the Democratic primary in her race for re-election to the US House of Representatives, dealing a blow to an array of Wall Street titans who poured money into her opponent’s campaign.
Germany assumes EU presidency with renewed sense of purpose; Angela Merkel’s first priority is to broker deal on bloc’s post-pandemic recovery fund
Guy Chazan and Sam Fleming – FT
When Angela Merkel set out her agenda for Germany’s presidency of the EU last week, she made it clear how high the stakes are. Germany’s role, she said, was to prevent the coronavirus pandemic unravelling the European single market and threatening the integrity of the EU.
SEC censures private equity and hedge fund managers over fees; US regulator identifies widespread ‘deficiencies’ that led investors to overpay for services
Chris Flood – FT
The US markets regulator has rebuked private equity and hedge fund managers for overcharging investors and secretly favouring their high-paying clients over other customers in clear contravention of existing regulations.
Dubai Financial Services Authority Publishes Cyber Thematic Review Report
The Dubai Financial Services Authority (DFSA) today published a thematic review report on cyber risks. The Report highlights a number of important opportunities for operational risk management practices of Firms operating in the Dubai International Financial Centre (DIFC).
IRS Provides Relief for Retirees on Required Distributions; Deadline for anyone who wishes to return money taken out of retirement accounts in 2020 is Aug. 31
Anne Tergesen – WSJ
The Internal Revenue Service issued a notice Tuesday that people who took required distributions from retirement accounts this year can put the money back. On March 27, President Trump signed into law a measure that suspends for 2020 the required minimum distributions, or RMDs, many retirees must take from tax-deferred 401(k) and individual retirement accounts.
Treasury Dept. May Consider Extending Tax Filing Deadline a Second Time; Secretary Mnuchin said he hopes next round of stimulus could pass both houses of Congress in July
Paul Kiernan – WSJ
The government may consider postponing the 2019 annual tax-filing deadline a second time, though Treasury Secretary Steven Mnuchin suggested Tuesday that the benefits of doing so would be less clear than before.
Hong Kong Monetary Authority And Hong Kong Securities And Futures Commission: Annual Update To The List Of Financial Services Providers Under The Clearing Obligation For OTC Derivative Transactions
The Hong Kong Monetary Authority (HKMA) and the Securities and Futures Commission (SFC) today issued joint consultation conclusions on the annual update to the list of Financial Services Providers (FSP List) (Note 1) under the clearing obligation for over-the-counter (OTC) derivative transactions.
SG Americas to Pay $3.1 Million to Settle Charges of Providing Deficient Blue Sheet Data
The Securities and Exchange Commission today announced settled charges against broker-dealer SG Americas Securities LLC for failing to provide complete and accurate securities trading information known as “blue sheet data.” SG Americas agreed to pay a $1.55 million civil penalty to resolve the SEC’s charges and separately agreed to pay $1.55 million to the Financial Industry Regulatory Authority (FINRA) to resolve parallel charges.
FINRA Fines SG Americas Securities $1.55 Million for Submitting Inaccurate Blue Sheet Data; SG Americas Securities to Pay $3.1 Million in Total Fines to FINRA and SEC
FINRA announced today that it has fined SG Americas Securities, LLC (SGAS) $1.55 million for submitting inaccurate trade data (known as “blue sheets”) to FINRA for more than seven years. Additionally, the firm must also certify within 90 days of this settlement that it conducted a comprehensive review and revised its systems and procedures related to the deficiency. The Securities and Exchange Commission (SEC) today announced a related settlement in which SGAS will pay $1.55 million for providing inaccurate blue sheet submissions to the SEC.
ASIC approves temporary COVID-19 changes to the Banking Code
ASIC has approved a variation of the Banking Code of Practice (Code). The variation, as proposed by the Australian Banking Association (ABA), involves the insertion of a ‘Special Note’ into the Code to allow for special application of specified Code provisions until 1 March 2021. The ABA has proposed the variation due to the extraordinary external environment caused by COVID-19.
NFA bars Scott Joseph Gecas, a former associated person, from membership for five years
NFA has barred Scott Joseph Gecas from membership and from acting as a principal of an NFA Member for five years. Gecas was an associated person (AP) of former Chicago, Ill. NFA Member introducing broker Long Leaf Trading Group, Inc. (Long Leaf).
Enforcement Initiatives, Developments and Priorities
This session provides an overview of new developments and trends in enforcement, including enforcement priorities. Panelists highlight noteworthy decisions and settlements that illustrate FINRA priorities, and provide guidance on regulatory and compliance practices.
Investing and Trading
U.K. Bond Yields Fall to Record, Catching Some Traders Off Guard
James Hirai and Eddie Spence – Bloomberg
Five-year rate declines to minus 0.047%, beating low in May; Concern over virus’s spread has spurred risk aversion
The turn in global market sentiment has caught out investors in U.K. government bonds, spurring a rally that sent the yield on five-year debt to an all-time low.
Billionaire Hamm Adds $57 Million of Faith In His Shale Driller
Dan Murtaugh – Bloomberg
Billionaire wildcatter Harold Hamm bought more shares in the shale drilling company he controls as oil prices recover from their historic plunge. Hamm added $57.1 million of shares in Continental Resources Inc., where he’s executive chairman, according to a filing with the U.S. Securities & Exchange Commission. The 3.44 million shares he purchased bring his total of direct and indirect shares to 288 million, or about 79% of the company.
Americans Roughed Up by the Market Still Think Stocks Are Great; Six in 10 investors say now is a good time to invest, even though half believe more pain is ahead in 2020.
Berber Jin – Bloomberg
Americans are still hopeful about the long-term health of the stock market, despite being pessimistic about how their investments will hold up in the short term, a Wells Fargo/Gallup survey found. Most people remain eager to invest — especially to try to build their retirement funds, the survey found. The quarterly survey of 1,076 of adults with at least $10,000 invested was conducted between May 11 and 17, when U.S. stock markets had rebounded from their 2020 lows in March but were still significantly below mid-February’s highs.
Families fleeing the city are pushing up home prices amid tight supply; A buyer from New York City saw a home via virtual tour, then three hours later offered the full asking price, in cash, one realtor said.
Martha C. White – NBC News
The number of existing home sales cratered in May, but real estate professionals — along with homeowners — say pent-up demand is roaring back, cheering sellers but threatening affordability for suburban and rural buyers competing with cash-flush buyers fleeing cities.
Bankruptcy Is Extra Burden for Some Job Seekers; Private employers can weigh a bankruptcy filing in assessing an applicant; consumer advocates want to change that
Katy Stech Ferek – WSJ
Hundreds of thousands of Americans who have lost their jobs during the coronavirus pandemic could be confronting an added barrier as they seek to rejoin the workforce: a bankruptcy on their record.
New Report From Invesco Finds Record USD15.4bn In Gold Purchased By Exchange Traded Products In Q1 2020
A record USD15.4 billion in gold was purchased by exchange traded funds and similar products in Q1 2020 globally, equivalent to 298 tonnes, according to a new market report from Invesco. The volume highlights the depth of the coronavirus-led market shift towards ‘safe haven’ assets and the central role that exchange-traded products (ETPs) have played in supporting investors at this key time.
The Activist Investor Done With Finance
Jeff Ubben’s plan to end finance as usual
One of America’s top activist investors said that he’s leaving the $16 billion hedge fund, ValueAct, that he has turned into a major force in corporate boardrooms. His reason is, perhaps, even bigger news.
ETFGI Reports That ETFs And ETPs Listed In Europe Reported Net Inflows Of US$10.59 Billion During May 2020
ETFGI, a leading independent research and consultancy firm covering trends in the global ETFs/ETPs ecosystem, reported today that ETFs and ETPs listed in Europe reported net inflows of US$10.59 billion during May, bringing year-to-date net inflows to US$21.33 billion which is significantly less than the US$38.51 billion gathered at this point in 2019. Assets invested in the European ETFs/ETPs industry have increased by 4.6%, from US$928.33 billion at the end of May, to US$971.21 billion, according to ETFGI’s May 2020 European ETFs and ETPs industry landscape insights report, an annual paid-for research subscription service. (All dollar values in USD unless otherwise noted.)
Barclays veteran eFX distribution head to lead FX business at TP ICAP; Holden Sibley will join TC ICAP as managing director and head of FX Hub after 17 years at Barclays.
Annabel Smith – The Trade
Interdealer broker TC ICAP has hired the head of eFX distribution for the Americas at Barclays to leads its FX trading services business.
INTL FCStone to rebrand as StoneX Group; Next month, INTL FCStone will become StoneX Group as it looks to drive digitalisation in markets following its GAIN Capital takeover.
Hayley McDowell – The Trade
US broker and clearing firm INTL FCStone has confirmed it will rebrand to become StoneX Group shortly after completing its acquisition of online trading services provider GAIN Capital.
Societe Generale appoints fixed income and currencies head for the Americas; Gareth Hughes will lead fixed income and currencies for the Americas at Societe Generale, after working for the bank since 2009.
Societe Generale has promoted one of its senior fixed income trading veterans to lead its fixed income and currencies division in the Americas.
Mizuho Investors Reject Shareholder Climate Resolution
Aaron Clark – Bloomberg
Nordic institutions among those that supported the proposal; Initiative shone the spotlight on Japan’s coal financing
Mizuho Financial Group Inc. investors rejected a shareholder climate resolution at a annual general meeting Thursday that had placed Japan’s third-largest bank in the spotlight for its financing of coal power projects.
Britain’s Racial Divide Is On Display in Work, Pay and Poverty
Andrew Atkinson and Zoe Schneeweiss – Bloomberg
Protests under the Black Lives Matter movement are causing the U.K. to look at its past to help understand the economic disadvantage of the present. The killing of George Floyd and the coronavirus have, respectively, forced the country to confront its history and links to the slave trade as well as policies that activists say have ignored — and in some cases exacerbated — the plight of minorities.
Recovery for Libya’s War-Torn Oil Industry to Be Slow and Costly
Salma El Wardany – Bloomberg
Facilities are decaying after nearly a decade without repairs; Potentially decisive battle at Sirte won’t end Libya oil woes
Libya’s oil industry is crumbling after more than nine years of neglected maintenance amid a civil war that’s killed thousands and destroyed towns across the country.
Qantas May Actually Benefit From the Coronavirus; With its near monopoly in the domestic market, the carrier is in a good position as aviation recovers.
David Fickling – Bloomberg
You might not have thought it three months ago, when the spread of Covid-19 forced Qantas Airways Ltd. to halt international flights and drove its shares to their biggest percentage drop in eight years. But a global pandemic could wind up being good news for the company.
In Asia, Brands Built on Racist Stereotypes Face Scrutiny; Marketing pitches that are insensitive to Black people and dark-skinned consumers are common.
Almost 90 years ago, consumer-products maker Hawley & Hazel decided to piggyback on the popularity of vaudeville singers like Al Jolson, a White man who won fame in Jim Crow America performing in blackface. The Shanghai-based company named its new toothpaste brand Darkie and emblazoned its packaging with a blackfaced man sporting a top hat and a toothy grin. Even before the recent Black Lives Matter protests around the globe, maintaining that kind of racial trope would have been considered a marketing bridge too far in much of the world.
Soybean Prices Rally as China Ramps Up Buying; A streak of big soybean purchases by Chinese buyers has helped make the crop profitable again for U.S. farmers
Kirk Maltais – WSJ
China has ramped up its purchases of U.S. soybeans recently, sparking a rebound in prices and making the crop profitable again for U.S. farmers after the coronavirus pandemic had slammed demand.
Austria sells another ‘century bond’ as borrowing costs fall; Country raises EUR2bn from sale of debt, which matures in July 2120
Philip Stafford – FT
Austria has sold another “century bond” three years after its first, seizing on the ultra-low borrowing costs available in the market after unprecedented stimulus efforts from the European Central Bank.
Brexit Deal Seen Erasing Pound’s Virus-Induced Loss. That’s All
Anooja Debnath, Eddie Spence, and Maria Elena Vizcaino – Bloomberg
Currency strategists see 55% chance of trade agreement in 2020; That would lift pound 4.4%, versus 5.6% slide if no deal: poll
The pound’s likely boost from a Brexit trade agreement this year will only just about help it recover from the damage inflicted by the pandemic, a Bloomberg survey found.
EU parliament leader: Boris Johnson seems unwilling to find compromise in Brexit talks
Daniel Boffey – The Guardian
Boris Johnson appeared unwilling to compromise in order to secure a trade and security deal with Brussels when he joined EU leaders for a summit last week, one of the three who attended the meeting has told the Guardian. David Sassoli, the president of the European parliament, punctured a recent outbreak of optimism over a potential deal by warning that the EU had been left concerned at the end of a video conference call by the lack of “enthusiasm” to find common ground on the most contentious issues.
Gove Attacked Over ‘Veil of Secrecy’ in Key Brexit Discussions
Edward Evans – Bloomberg
The U.K. government is hindering lawmakers’ efforts to properly scrutinize key decisions over the country’s exit from the European Union, a parliamentary panel said. The European Scrutiny Committee called on Cabinet Office Minister Michael Gove to lift what it called the “veil of secrecy” surrounding the Joint EU-U.K. Committee and its sub-committees that oversee the implementation of the Brexit Withdrawal Agreement. The panel also asked Gove to promise to consult Parliament on any changes affecting Northern Ireland.
Bankers Almanac Celebrates 175th Anniversary – Continues To Be The Leading Source Of Global Financial Intelligence For Organisations Worldwide
Accuity, the leading global provider of financial crime screening, payments and know your customer (KYC) solutions, has marked the 175th anniversary of Bankers Almanac, one of the most authoritative and comprehensive sources of financial intelligence that informs the decisions of virtually every bank around the world.
Battered U.S. Wine Importers Brace for Higher Tariffs; White House is considering raising levies on European wines to 100% from 25% over an aviation trade dispute
Josh Zumbrun – WSJ
Harry Root’s business distributing imported wine from Europe was already reeling from a sales slump brought on by coronavirus lockdowns when he was hit with another gut-punch: a $25,000 tariff on a shipment of rose, “fun whites” and beaujolais wines at the Port of Charleston.