Wall Street Bank Lobby Lines Up Against a US Digital Dollar; ‘So ashamed’: Russian diplomat quits over Ukraine invasion, attacking Putin’s circle as corrupt and obsessed with luxury

May 24, 2022

First Read

Hits & Takes
John Lothian & JLN Staff

Eurex’s Derivatives Forum Frankfurt kicked off this morning. I hope to catch up on some of the content as the videos are posted to the site.

The World Economic Forum Annual Meeting 2022 is also happening at the same time, and real-time video of some of the content is available from their website without registration.

The CFTC announced yesterday that “Block Trade” Definition compliance begins May 25, ending staff CFTC provided no-action relief. Beginning on May 25, all Swap Execution Facilities are required to comply with the amended definition of “block trade” under CFTC Regulation 43.2.

Citadel’s Ken Griffin was interviewed on Bloomberg Intelligence about the LME nickel trading problems and needless to say, he was not a fan.

If you are in New York City and you don’t have a cellphone, you are better off borrowing someone else’s than looking for a payphone. New York City just removed the last public pay phone and moved it to the Museum of the City of New York, probably next to the typewriter, the telegraph and the DIY smoke signals chart.

As I am getting ready to go to London for IDX, it was time for me to brush up on my travel tips. Daily-Stuff.com has an article, “How to spot an American tourist abroad.” There were just way too many truths in this article. Is it time for me to go get a proper blue British banker suit and try to blend in? Never going to happen. I am just too American, though I will leave my baseball hat at home.

My wife Cheryl and her brothers are headed to Utah to see the band The Eagles play. Thus, I am left at home with our dogs Indy and Bella for the next five days. These are the dog days of May.

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

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‘Ashamed’ Russian diplomat resigns over Putin’s ‘aggressive war’
Emily Rauhala – The Washington Post
A diplomat at Russia’s mission to the United Nations in Geneva has resigned over the war in Ukraine, writing that he has never been “so ashamed” of his country, in a rare public rebuke of the war from within the Russian government. In a letter circulated to colleagues in Geneva and posted on a LinkedIn account in his name as well as on Facebook, Boris Bondarev, counselor at the Permanent Mission of the Russian Federation to the United Nations, said he had left the civil service Monday.
/jlne.ws/3LFbCDt

***** We can only hope there are more Russians of conscience that feel the same way.~JJL

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What Fantasy Football Can Teach Money Managers; Sharpen your stock-picking skills by assembling a portfolio of strikers and wingbacks.
Marc Rubinstein – Bloomberg
The English football season ended Sunday, and for 9.2 million players of the Fantasy Premier League that means finding something else to mull over on a Saturday morning. In the past few years, the fantasy version of the beautiful game has taken off. Each week, fantasy managers field a team of 11 players whose performances on the pitch convert to points in their game.
/jlne.ws/39QYVs4

***** I fear this fantasy has escaped the American shores and has now climbed the cliffs of Dover.~JJL

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Crypto links with banks pose threat to financial stability, says ECB; Central bank warns market is becoming more complex and interconnected with mainstream finance
Martin Arnold – FT
The crypto industry’s deepening ties to banks and asset managers will pose a risk to financial stability, the European Central Bank has warned, in the latest sign of how central banks and governments are stepping up their scrutiny of the market. The ECB said on Tuesday it had undertaken “a deep dive into cryptoasset leverage and crypto lending” and found evidence that these activities were becoming more risky, complex and interconnected with traditional institutions.
/jlne.ws/3wDVg9Y

****** So this asset, which is worthless according to some prominent central bankers, and being used for lending, might be a risk? OK, I got it.~JJL

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When Your Job Fills In for Your Faith, That’s a Problem
Carolyn Chen – NY Times
Plenty of writers have argued in recent years that work has become “a false idol,” with the office, not church, the place where many Americans now seek out meaning and purpose. As a sociologist of religion, I think these writers are right: Work is replacing — and in some cases, even taking the form of — religion among many of America’s professionals. Between 2013 and 2018, I conducted over a hundred interviews for my book “Work Pray Code.” Most of them were with tech workers based in Silicon Valley, people who told me over and over their careers are “spiritual journeys” and their work a “calling.” Many said that they had become more spiritual, whole and connected after working in tech. Their workplaces were communities where they found belonging, meaning and purpose.
/jlne.ws/3yVbhcT

***** God calls us in many different ways. It is a mystery.~JJL

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Monday’s Top Three
Our top clicked story on Monday was a blog post on The Morning Chalkboard about the last day of trading on the CME floor that was dubbed “The Arboretum” after Pat Arbor. (You have to scroll down a bit to see the post.) Second was Goldman CEO says ‘devastated’ by fatal subway shooting of employee, the sad news about Daniel Enriquez, a GS employee who was fatally shot on a Manhattan-bound Q train, from Reuters. Third was The future of crypto trading is futures, about institutional investors in the digital asset market, from The Financial Times.

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MarketsWiki Stats
26,837 pages; 238,580 edits
MarketsWiki Statistics

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Lead Stories

Wall Street Bank Lobby Lines Up Against a US Digital Dollar; ABA, BPI say CBDC would likely drain deposits from bank system; US government weighing whether to launch own digital currency
Allyson Versprille – Bloomberg
Wall Street lenders are calling on the US government to hold off on launching a digital dollar, arguing that a virtual currency backed by the Federal Reserve risks draining hundreds of billions of dollars out of the banking system. An American central bank digital currency, or CBDC as it’s known, would act as a direct competitor to private bank deposits and make credit less available to businesses and households, according to the American Bankers Association and the Bank Policy Institute. The trade groups were responding to a Fed discussion paper released in January that laid out the potential benefits and risks of launching a new virtual tender.
/jlne.ws/39QX8mR

‘So ashamed’: Russian diplomat quits over Ukraine invasion, attacking Putin’s circle as corrupt and obsessed with luxury
Mia Jankowicz – Business Insider
A top Russian diplomat has resigned his post with a scathing letter attacking Russia’s war in Ukraine and what he described as his country’s political degradation, according to multiple reports. “Never have I been so ashamed of my country as on February 24 this year,” wrote Boris Bondarev in a letter sent to diplomats on Monday and shared by the nonprofit organization UN Watch.
/jlne.ws/3yR0NLO

Crypto Shows All the Signs of Financial Stability Risk, ECB Says; Central bank says crypto regulation in the EU is urgent; ECB officials have stepped up crypto warnings in recent days
William Horobin – Bloomberg
A dramatic increase in the size and complexity of crypto markets means the sector is on track to become a risk for financial stability that must urgently be regulated, the European Central Bank said. While recent volatility has not proved contagious to the rest of the global financial system, the threat is increasing with institutional investors increasingly involved, the ECB said in a pre-released chapter from its financial stability review.
/jlne.ws/39KtzmO

How Janus Henderson Lost Two CEOs and Billions of Client Assets; ‘Merger of equals’ was meant to boost both fund managers; Firm has struggled since, losing AUM, executives and value
Loukia Gyftopoulou, Silla Brush, and Scott Deveau – Bloomberg
Everyone in the room knew it was over. First one side, the UK one, had seen its CEO ousted. Now the other side, the US one, was about to see its CEO head for the exit, too. It was September 2021, and the end was near for Dick Weil, the American who’d deftly maneuvered his way to the top of a transatlantic amalgamation of two famous if faded names in mutual funds.
/jlne.ws/3GcUPq2

HSBC and Its Discordant Climate Songbook; A top executive at the global bank sings a different tune and rightly draws tomatoes and ESG broadsides.
Chris Hughes – Bloomberg
If Stuart Kirk had been a nondescript hedge-fund manager when he gave a speech questioning the financial consequences of climate change, it wouldn’t have attracted half as much controversy. But Kirk’s job title was head of responsible investments at HSBC Holdings Plc’s asset-management unit. That changes everything. Kirk created a social-media storm last week after saying investors don’t need to worry about climate risk, and regulators were creating too much work for him and his team on the topic. HSBC Chief Executive Officer Noel Quinn said the comments, made at a conference hosted by the Financial Times, don’t represent the views of the bank’s senior management. The FT reported on Sunday that Kirk has since been suspended.
/jlne.ws/38bGwpd

SEC prepares to crack down on misleading ESG investment claims; Pending rules come as funds repackage themselves for the $3tn ‘sustainable’ market
Patrick Temple-West and Stefania Palma – FT
The US securities regulator is poised to crack down on exaggerated environmental, social and governance credentials in investment products, preparing standards for a sustainable funds industry that has boomed to almost $3tn.
/jlne.ws/3LH8Ld2

Index providers take record $5bn in revenue in 2021; The figure marks a 23% rise on the total collected in 2020, new research shows
Sonya Swink – FT
The boom in ETF assets helped index providers collect a record $5bn in revenue in 2021, a new report shows. Overall, index providers collected 23 per cent more in revenue last year than they did in 2020, according to a report from Burton-Taylor International Consulting. Over the past five years, the compound annual growth rate averaged 11.7 per cent.
/jlne.ws/3wIu3TD

Natural Gas Market Is Hurtling Toward Historic Winter Shortages
Stephen Stapczynski and Heesu Lee – Bloomberg
The liquefied natural gas market is hurtling toward a potentially historic shortage this winter as the world rushes to secure the super-chilled fuel. Europe’s plan to cut imports of piped Russian gas by two-thirds by the end of the year and replace it with LNG from the US and Africa is sharply intensifying competition for the power-plant and heating fuel. There’s also an expectation that China’s battle with Covid-19 will be winding down later in 2022, which should stoke industrial demand from Asia’s biggest economy.
/jlne.ws/3wGmIny

Texas Republicans Roil Muni Market Again With Energy Law
Danielle Moran and Amanda Albright – Bloomberg
Big Wall Street banks were already shut out of Texas’ municipal bond market, where the state and its cities raise money, for policies deemed unfriendly to the gun industry. Now an even larger group could see their public finance businesses hurt by legislation limiting contracts with firms that “boycott” the energy industry. Banks like Morgan Stanley and Wells Fargo & Co. are losing out on municipal-bond deals or finding that they’re essentially sidelined from transactions because of the uncertainty surrounding Texas Comptroller Glenn Hegar’s effort to implement the law, which is meant to protect the state’s oil and gas industry against the rise of environmental, social and governance standards.
/jlne.ws/3sTg1Ml

“Block Trade” Definition Compliance Begins May 25, Ending Staff CFTC Provided No-Action Relief
CFTC
The Commodity Futures Trading Commission’s Division of Market Oversight (DMO) today reminds swap execution facilities (SEFs) that the block trade no-action relief provided in CFTC Staff Letter No. 20-35 will expire on May 25. Beginning that day SEFs are required to comply with the amended definition of “block trade” under CFTC Regulation 43.2. Since 2014, DMO has provided no-action relief for SEFs that have rules and/or procedures to facilitate the execution of block trades for swaps that are intended-to-be-cleared (ITBC) through the SEF’s non-order book trading systems or platforms, and thus were not compliant with the then-Part 43 final rules definition of “block trade” which required block trades to occur away from a SEF’s trading systems or platforms (Block Trade Relief).
/jlne.ws/3yWkOAC

GameStop Launches Digital Wallet for Crypto, NFTs; Videogame retailer looks to turn around core business while tapping into buzzy area
Will Feuer – WSJ
GameStop Corp. launched a digital wallet for cryptocurrencies and nonfungible tokens, pushing further into a buzzy area as it looks to turn around its core videogame business. The company said Monday that the move will allow gamers and others to store, send, receive and use cryptocurrencies and NFTs across decentralized apps without having to leave their web browsers. The Wall Street Journal in January reported that GameStop, a poster child of the meme-stock craze that drove frenetic trading last year, was establishing a division to develop an NFT marketplace and establish cryptocurrency partnerships.
/jlne.ws/3LHMfkv

Terra Collapse Triggers $83 Billion Decentralized Finance Slump
Emily Nicolle – Bloomberg
The collapse of one of decentralized finance’s most ambitious experiments has knocked more than $83 billion off the sector’s total value, as investors fled for safer havens. A crash in the prices of stablecoin TerraUSD, or UST, and its sister token Luna in the first half of May sent shock waves through the DeFi sector, where investors borrow, lend and stake cryptocurrencies without intermediaries like banks. The total value locked across all major protocols has slumped to $112 billion from $195 billion at the start of the month, data from industry tracker DeFi Llama show.
/jlne.ws/3PCpn9c

SEC fines BNY Mellon over ESG in first case of its kind; Regulator hits investment adviser with $1.5mn penalty for allegedly misstating and omitting information
Patrick Temple-West and Stefania Palma – FT
The US Securities and Exchange Commission has fined BNY Mellon’s investment adviser division $1.5mn for allegedly misstating and omitting information about environmental, social and governance (ESG) investment considerations for mutual funds that it managed. The case marks the first time the SEC has settled with an investment adviser concerning ESG statements and comes two days before the agency is set to propose rules establishing how financial firms can apply ESG or other green labels to investment funds. The agency has increasingly been on the hunt for potential greenwashing. From July 2018 to September 2021, BNY Mellon Investment Adviser suggested in documents that all investments in the funds had undergone an ESG quality review, but that was not always the case, the SEC said. Investments held by certain funds did not have an ESG quality review score as of the time of investment, the SEC said.
/jlne.ws/3wFxtGy

Is China ‘Uninvestable’ and What Does That Even Mean?
Sofia Horta e Costa – Bloomberg
For more than a year, President Xi Jinping inveighed against the “disorderly expansion of capital” as he launched punishing regulatory and antitrust campaigns against the private sector, from Big Tech to after-school tutoring. That’s made life more difficult for investors, who since the global financial crisis had benefited greatly from an economic boom in the world’s second-largest economy. Those who rode the bull market are now saddled with losses as erratic government policies — and a murky information flow — turned China’s financial markets into the most turbulent globally. Some investors gave up and called parts of China “uninvestable.” The question now is whether this year’s apparent shift in rhetoric will convince them that it’s safe to come back.
/jlne.ws/3wFHd3C

Czech Republic Gives Ukraine Attack Helicopters and Repairs Its Vehicles; Officials say efforts to fix armored vehicles are part of larger commitment to restore Soviet-style equipment in Ukraine’s possession
Drew Hinshaw – WSJ
The Czech Republic has donated attack helicopters to Ukraine, and along with Slovakia, has allowed Ukraine’s military to send dozens of armored vehicles across their borders for repairs before they are returned to the conflict. The moves mark a significant escalation in Western support for the country in its fight with Russia. The helicopters—Soviet-designed Mi-24 gunships—were deployed to Ukraine in recent weeks, part of a broader effort to help the country reclaim its airspace. Defense Secretary Lloyd Austin thanked the Czechs for their donation during public comments after a Monday meeting of allied defense officials.
/jlne.ws/39HIDl7

The world’s financial system is entering dangerous waters again, warns guru of the Lehman crisis
Ambrose Evans-Pritchard – The Telegraph
If anybody knows where the points of maximum stress lie as monetary tightening collides with epic levels of global debt, it is the man who wrote the definitive opus on the last traumatic blow-up in 2008. Columbia professor Adam Tooze is the rising star of the Davos circuit. His book Crashed: How a Decade of Financial Crises Changed the World is a superb forensic analysis of the political and economic brew that led to the meltdown of the western banking system, and led to the Lost Decade that followed, with invidious consequences for Western liberal democracies.
/jlne.ws/3LU8rbj

JPMorgan warns overseas digital bank losses could top $1bn after UK push; Forecast is the most in-depth it has given since expanding retail presence of its Chase brand outside the US
Joshua Franklin – FT
JPMorgan Chase expects to lose more than $1bn in the next few years on its new digital-only international consumer bank that began operations in the UK last year. Sanoke Viswanathan, JPMorgan’s chief executive for international consumer growth initiatives, said during an investor day presentation on Monday that the bank hoped the digital Chase business would break even by 2027 or 2028.
/jlne.ws/38GhcrV

Why climate change angst is not just an HSBC issue; The banking and asset management sector has much work to do to win the argument internally
Cat Rutter Pooley – FT
Banks take hugely varying approaches in their commitments to tackling climate change. But there’s at least one point of consensus. You have to be seen to be taking it seriously. A talk entitled “why investors need not worry about climate risk” from an HSBC executive hints at disharmony in the ranks.
/jlne.ws/3lFBpAI

Ukraine Invasion

Volodymyr Zelensky calls for global plan to rebuild Ukraine after war; President urges leaders at Davos to help fund reconstruction that is set to cost more than $500bn
Chris Giles and Max Seddon – FT
Volodymyr Zelensky has urged the international community to help fund Ukraine’s reconstruction after the war and use frozen Russian assets to compensate victims. Borrowing words used to launch the reconstruction of Europe after the second world war under the Marshall Plan, Ukraine’s president said his proposal to help cover a rebuild that looks set to cost more than $500bn was “designed to counter hunger, poverty, despair and chaos”. Speaking by video link to a packed main conference hall at the World Economic Forum in Davos, Zelensky said: “I invite you to take part in this reconstruction. The work to be done is colossal. There are more than [$500bn] in losses. Tens of thousands of buildings have been destroyed.”
/jlne.ws/3wMQ1n0

Russia’s invasion of Ukraine has been ‘slow and unsuccessful,’ Pentagon says
Alexander Nazaryan – Yahoo! News
Russia’s invasion of Ukraine continues to be hampered by consistent military assistance to Ukraine from allies in Europe and elsewhere, U.S. military leaders said on Monday after a meeting with allies who made new pledges of weaponry as the war in Eastern Europe is on the cusp of entering its fourth month. “We remain committed, resolved and united in our assistance to Ukraine,” Joint Chiefs of Staff Chairman Mark Milley said at a Pentagon briefing after a second meeting of the Ukraine Contact Group, a consortium that now includes nearly 50 nations, most of them in Europe, committed to defending Ukraine against the invasion that the Kremlin launched in late February.
/jlne.ws/39KypjV

Russia’s Shrinking War; The goals of Russia’s invasion keep getting smaller. But its depleted military is still failing to make major advances, and time is on Ukraine’s side.
Josh Holder, Marco Hernandez and Jon Huang – NY Times
After failing to topple Ukraine’s government in Kyiv, Russia redeployed troops for a far less ambitious goal: Seize the rest of the Donbas, beyond the area where Russia had already advanced a month ago.
/jlne.ws/3sSIdiz

Starbucks is leaving Russia.; The coffee chain said it had closed 130 stores in the country, where a licensing partner employs about 2,000 workers, and ended its brand presence there.
Melina Delkic – NY Times
Starbucks announced on Monday that it was officially exiting Russia, with 130 stores run by a licensee there closing. The company has also halted the shipment of any Starbucks products. The company said in a statement that nearly 2,000 employees in the country would be paid for six months and given help to “transition to new opportunities outside of Starbucks.” In early March, the coffee chain condemned Russia’s invasion of Ukraine and announced that it was suspending all store operations in agreement with its licensing partner, which owns and operates all of the Starbucks outlets in Russia.
/jlne.ws/3PHVFzM

Powerful American Artillery Enters the Fight in Ukraine; The most lethal weapons the West has provided so far to Ukraine are now deployed in combat. Will they make a critical difference for Ukraine’s military in a war that has mostly become an artillery battle?
Andrew E. Kramer and Maria Varenikova – NY Times
Camouflaged in a heap of branches cut from nearby trees, the weapon that Ukraine hopes will make a critical difference in its war with Russia is all but invisible from more than a few feet away. Soon, a single round shoots out with a boom and a howling, metallic shriek as it sails toward Russian positions.
/jlne.ws/3lDhRgE

Russia Is Winning From the Global Food Crisis It Helped Create; While Ukraine’s ports are blocked, Russia is shipping grains to willing buyers at higher prices.
Aine Quinn – Bloomberg
Russia’s war against Ukraine, while deepening a global food crisis, has made the invader among the biggest winners of the mess it helped create. The war has blocked Ukraine’s grain exports by sea, cutting off vital supplies for countries from Somalia to Egypt. The disruption, topped by hot weather and droughts that are hurting wheat crops in other parts of the world, has sent prices of the grain to near-record highs and is threatening hunger in parts of the Middle East and North Africa.
/jlne.ws/3PEp2mj

French Assets Owned by Russians Close to Putin Hit With Lawsuit
Gaspard Sebag – Bloomberg
The French real estate assets of businessmen and top-ranking officials close to Russian President Vladimir Putin were targeted in a lawsuit that alleged they were bought with criminal money. Transparency International France lodged the suit Friday against unnamed persons over allegations of money laundering and failure to justify financial resources. The allegations are based on open-source data that the NGO says enabled them to map out the properties of individuals close to the Russian regime.
/jlne.ws/39QCDGA

UK professional services firms seek exemptions to ban on Russia work; Industry body recommends that advisers are allowed to help clients meet legal requirements
Michael O’Dwyer and Daniel Thomas – FT
Auditors and tax advisers in the UK are lobbying the government for exemptions from a ban on working for businesses in Russia imposed after the invasion of Ukraine. Foreign secretary Liz Truss this month announced plans to force British accounting, management consulting and public relations firms to cut ties with Russian clients as part of efforts to punish Russia’s president Vladimir Putin.
/jlne.ws/3GgUeE8

Record levels of FX and equity futures activity in the run-up to UMR Phase 6, finds CME Group; With 100 days to go until the implementation of UMR Phase 6, all-time records of positions in FX and equity futures have been adopted by market participants.
Wesley Bray – The Trade
An all-time record number of market participants are taking large open interest positions in FX futures, according to CME Group data, while interest in equity futures is expanding rapidly – 100 days out from the final phase of the Uncleared Margin Rules (UMR). Holders of large open positions in FX futures reached a new record of 1,312 as of 10 May, following an all-time level of open interest in FX futures and options of over 3 million contracts (~$290 billion notional) which was reached earlier in the month.
/jlne.ws/3wOnGwE

APG Asset Management to access Eurex’s ISA Direct for repo clearing; The move will allow clients to address market liquidity concerns as well as regulatory-driven challenges.
Wesley Bray – The Trade
Pension fund investment manager APG Asset Management (APG) will start to access Eurex’s centrally cleared repo markets from mid-June 2022, via the latter’s ISA Direct clearing services. The move follows Eurex’s decision to offer expanded access to its cleared repo business to the buy-side, announced last year – which gave hedge funds and other firms increased access to the scheme.
/jlne.ws/3PEADSn

Exchanges, OTC and Clearing

Eurex wins one of the world’s largest pension fund managers for repo clearing
Eurex
– As of mid-June 2022, APG Asset Management N.V. will start trading and clearing centrally cleared repos for its clients via ISA Direct
– Eurex’s ISA Direct clearing service aims to broaden direct CCP access for centrally cleared repo and OTC interest rate swaps
– European pension funds with assets under management of more than EUR 1 trillion will then be connected to Eurex’s cleared repo markets
/bit.ly/3yVgjq4

EEX Group outlines roadmap for entry into Voluntary Carbon Market; Global listing of a dedicated Voluntary Carbon Market product suite – Launch in North America at Nodal Exchange in June and followed by EEX in Europe in H2 2022
EEX Group
EEX Group continues its commitment to a sustainable future by entering the Voluntary Carbon Market (VCM), with a product suite addressing the increasing demand from corporates which seek to offset or neutralise their carbon footprint. Leveraging on its considerable experience in global carbon markets, EEX Group intends to bring enhanced levels of standardisation, transparency and security to the Voluntary Carbon Market.
/jlne.ws/3yX6eJ8

CareTrust REIT Completes Listing Transfer to the New York Stock Exchange
ICE
The New York Stock Exchange, part of Intercontinental Exchange, Inc. (NYSE: ICE), a leading global provider of data, technology and market infrastructure, announced that CareTrust REIT, Inc. (NYSE: CTRE) completed its listing transfer and began trading today as an NYSE-listed company.
/bit.ly/3wELzI5

Nicolet Bankshares, Inc. Completes Listing Transfer to the New York Stock Exchange
Intercontinental Exchange, Inc.
The New York Stock Exchange, part of Intercontinental Exchange, Inc. (NYSE: ICE), a leading global provider of data, technology and market infrastructure, announced that Nicolet Bankshares, Inc. (NYSE: NIC) completed its listing transfer and began trading today as an NYSE-listed company.
/jlne.ws/38MNFfV

Candidates for Directors of Japan Securities Clearing Corporation
JPX
We hereby announce that Japan Securities Clearing Corporation, a subsidiary of Japan Exchange Group, Inc., has nominated candidates for directors to be put forth for approval at the annual general shareholders meeting to be held on June 14, 2022.
/bit.ly/3wKKX2L

Daily Price Limits to be Broadened : 2 issues
JPX
The following 2 issues have fallen under the following (1) or (2) for two consecutive business days. As such, TSE wishes to bring to your attention that it will broaden only the upper (or lower) daily price limit on the next business day (May 25) as follows.
/bit.ly/3yUJb1u

Regular Constituents Chagnes in KOSPI 200, KOSDAQ 150 and KRX 300
KRX
There will be regular constituents changes in KOSPI 200, KOSDAQ 150 and KRX 300, effective from June 10, 2022.
/bit.ly/3Nu5r6z

LMEpassport sustainability disclosures multiply as new certifications added
Four new sets of standards and certifications now available on LMEpassport
LME
Additional 17 producers now disclosing sustainability data
Total of 26 producers and 160 disclosures now listed on LMEpassport
The London Metal Exchange (LME) is pleased to announce the introduction of a range of new certifications on its digital credentials register, LMEpassport, enabling more producers to report on a wider range of sustainability metrics – as demonstrated by the 17 new producers doing so today.
/bit.ly/3LAF7q0

Transactions on the stock market of the Moscow Exchange in April were made by more than 2 million private investors
MOEX
The number of individuals with brokerage accounts on the Moscow Exchange at the end of April 2022 amounted to 19.3 million (+442 thousand in April), they opened 32.7 million brokerage accounts.
/bit.ly/3sQ4q0Q

Moscow Exchange has developed an information bulletin on the commodity market
MOEX
Since May 23, 2022, the National Commodity Exchange (NTB, part of the Moscow Exchange Group) has developed a weekly Commodity Market Information Bulletin for legal entities.
/bit.ly/39O9hsK

Fintech

Russian-Speaking Technologists Rebuild Their Lives in a San Francisco Home; They moved from Russia, Ukraine, Belarus and other countries for jobs in the technology industry. Now they are joined by friends fleeing war and repression.
Cade Metz – NY Times
Over the past five years, Andrey Doronichev has shared his four-story townhouse with nearly 100 entrepreneurs, investors and other aspiring technologists from countries that were once part of the Soviet Union.
/jlne.ws/3NxSjNH

TNS Announces First Managed Hosting and Colocation Access in BME Data Center
Transaction Network Services
Transaction Network Services (TNS) has launched its popular Managed Hosting and Colocation offering in Madrid, which is set to benefit financial market participants looking to access Spain’s principal stock exchange, Bolsas y Mercados Españoles (BME). This is TNS’ first deployment in Spain and joins Frankfurt, Germany and Bergamo, Italy as the organization’s third Managed Hosting and Colocation venue in mainland Europe. It is the seventh site in Europe for TNS with Basildon, LD4, Interxion and LSE in the UK. The announcement underpins TNS’ commitment to investing in its European infrastructure.
/jlne.ws/3lB9SAD

BNP Paribas joins JP Morgan’s Onyx blockchain as it ramps up digital assets play; The bank traded its first intraday repo on the platform last week, becoming the first European bank to join the network.
Laurie McAughtry – The Trade
BNP Paribas has run its first trade on JP Morgan’s Onyx Digital Assets platform, becoming the first European bank to trade on the blockchain-based network. “Digital transformation is a key pillar of our strategy within Global Markets. Through Onyx Digital Assets, we can now leverage blockchain technology for repurchase agreements creating new opportunities to streamline our processes, access intra-day liquidity and ultimately better serve our clients,” said Joe Bonnaud, BNP Paribas Global Markets COO and head of engineering.
/jlne.ws/3wNqxG6

Cybersecurity

States, localities await federal help on cybersecurity
Federal experts to help build safeguards against ransomware attacks
Gopal Ratnam – Roll Call
The House passed legislation last week to ensure that federal cybersecurity experts assist their state and local government counterparts in protecting networks from devastating attacks like those that have crippled cities in Alabama, Michigan, Oklahoma and elsewhere.
The legislation would codify support and assistance that the Cybersecurity and Infrastructure Security Agency already offers to state and local governments. The agency provides security tools, helps states draft policies and procedures, conducts cybersecurity exercises and shares threat information through collaborative channels.
/jlne.ws/3MJ9ETX

Reskilling workers can help meet the cybersecurity staffing challenge
Vishal Salvi – Security Magazine
Among the many changes unleashed by COVID-19, one has been a dramatic increase in the use of digital tools. The World Bank projects that total internet traffic this year will be 50% higher than it was just two years ago. The increased digitalization, needless to say, also amplifies the risks of cyber threats and attacks for us all. That underscores the importance for companies to strengthen their capabilities to develop, implement, and maintain robust cybersecurity protocols.
/jlne.ws/3wLsaUT

Cybersecurity firm Semperis raises over $200 million in KKR-led round
Krystal Hu – Reuters
U.S. cybersecurity software firm Semperis said it has raised over $200 million in a funding round led by private equity firm KKR & Co Inc (KKR.N) at a valuation substantially higher than in its previous round.
Existing investors including Insight Partners and new investors such as Ten Eleven Ventures joined KKR in the round, Semperis told Reuters.
/jlne.ws/3MKoA3Z

Cryptocurrencies

$40bn crypto collapse turns Korea against the ‘Lunatic’ leader; Implosion of cryptocurrency offering 20% yield makes developer Do Kwon ‘the most hated man in Korea’
Christian Davies and Song Jung-a – FT
After Do Kwon indicated he would inject $300mn into the reserves that underpinned the 20 per cent yield on his luna cryptocurrency, a Twitter user asked him where the money would come from. Kwon’s response was succinct: “Your mom, obviously.” Now the brash 30-year-old Korean, who routinely derides his critics as “poor”, is being asked to account for this month’s $40bn collapse of a creation he once described as “the oldest and most widely used algo[rithmic] stablecoin in existence”, before adding: “Bow before the king.”
/jlne.ws/3LFR2CQ

Coinbase’s $51 Billion Nosedive Isn’t Only About Crypto Winter
Olga Kharif and Yueqi Yang – Bloomberg
The firm’s market value has shrunk by about $51 billion since the end of its first day of trading last April. Coinbase shares fell to an all-time low earlier in May, and even after recovering somewhat are still down about 80% from their debut. That’s a steeper drop than Bitcoin’s 53% slump in the same period. The recent bear market and regulatory pressure in crypto have played a big role. Last year, a promising yield-account product called Lend drew ire from the Securities and Exchange Commission, leading the company to scrap it and prompting a public rant by Chief Executive Officer Brian Armstrong. And as crypto prices crashed in the past six months, trading volumes dropped across most exchanges.
/jlne.ws/3PQjMML

IMF’s Georgieva Urges Against Abandoning All Crypto After Terra’s Crash; Risks are there, but not equally among all types of crypto; Regulators must provide better guardrails, education
Allyson Versprille and Emily Nicolle – Bloomberg
People shouldn’t completely shun the crypto world after the recent collapse of a popular stablecoin, an official at the International Monetary Fund said Monday. TerraUSD, or UST, imploded earlier this month, setting off a chain reaction that saw the overall value of the cryptocurrency market slashed by hundreds of billions of dollars.
/jlne.ws/3GfVebf

Sumitomo Mitsui Trust to Set Up Digital Asset Custody Company
Taiga Uranaka – Bloomberg
Sumitomo Mitsui Trust Holdings Inc. is teaming up with a Japanese crypto firm to create a trust company to manage digital assets for institutional investors. The bank has signed a memorandum of understanding with crypto exchange operator bitbank inc. to offer custody services for public blockchain-based crypto assets, including NFTs.
/jlne.ws/3wHE16t

Money Clinic Podcast: Surviving the ‘Crypto Crash’; As two young investors reveal the extent of their crypto losses, could more be done to protect consumers?
Claer Barrett – FT
In the past few weeks, the crypto industry has been shaken by a $40bn wipeout with many so-called “stablecoins” proving themselves to be anything but. The problems started with Terra and Luna, a linked set of digital tokens popular with crypto traders, but the growing fallout has hit the value of more established cryptocurrencies such as bitcoin.
/jlne.ws/3MPcHtW

To use rather than collect, the second coming of NFTs
Thomas URBAIN – AFP
NFTs have been called everything from fads to outright scams, but early adopters see a future for them as uniquely useful tools for business, health and the arts that goes beyond mere digital collecting. The non-fungible token (NFT) craze, just over a year old, has given the world works that have sold for millions and includes collections from the “Bored Ape Yacht Club” to an image of a naked Donald Trump following his 2020 election defeat. This booming world of digital assets has opened up a new market into which tens of billions of dollars have been poured, while also provoking discussions about how they could be useful in the real world.
/jlne.ws/3MX73Gd

Should you invest in drinks NFTs? A beginner’s guide to booze’s new cryptocurrency Wild West
Alice Lascelles – FT
Next month sees the launch of Wokenwine, the first trading platform dedicated to fine wine NFTs. But what does this mean for drinks? While some NFTs correspond to intangible things (such as Jack Dorsey’s first tweet), a drinks NFT corresponds to a physical bottle. The NFT is minted by the company that makes the product and held on the cryptocurrency blockchain (which works like a paper trail of transactions) so that, however many times the product changes hands, its authenticity is guaranteed.
/jlne.ws/38MOx4b

Politics

Biden says no change to U.S. “strategic ambiguity” on Taiwan
Trevor Hunnicutt and Sakura Murakami – Reuters
U.S. President Joe Biden on Tuesday said there was no change to a U.S. policy of “strategic ambiguity” on Taiwan, a day after he appeared to stretch the limits of the U.S. line on the island by saying he would be willing to use force to defend it. The issue of Taiwan looms over a meeting in Tokyo of leaders of the Quad grouping of the United States, Japan, Australia and India, who have stressed their determination to ensure a free and open Indo-Pacific region in the face of an increasingly assertive China.
/jlne.ws/3wH59Uq

Russian invasion of Ukraine is a global issue, says Biden
Oleksandr Kozhukhar and Hans-edzard Busemann – Reuters
U.S. President Joe Biden said on Tuesday that the crisis in Ukraine was a global issue which heightened the importance of maintaining international order, territorial integrity and sovereignty. Biden’s comments delivered at the opening of the “Quad” meeting of Indo-Pacific leaders in Tokyo come a day after he broke with convention and volunteered U.S. military support for Taiwan, the self-governed island claimed by China
/jlne.ws/3yVq5bM

Regulation

SEC Fines BNY Mellon Over ESG Claims; Regulator is boosting its scrutiny of funds as market grows
Dean Seal and Amrith Ramkumar – WSJ
The Securities and Exchange Commission fined the investment management arm of Bank of New York Mellon Corp. $1.5 million for misleading claims it made about funds that use environmental and social criteria to pick stocks. The SEC said Monday that BNY Mellon Investment Adviser Inc. agreed to pay the fine after regulators found that some U.S. mutual funds it managed didn’t go through a quality review of environmental, social or governance factors from July 2018 to September 2021. BNY neither admitted nor denied the claims. Wall Street’s regulator is stepping up its scrutiny of claims by ESG funds as investors pour cash into the category.
/jlne.ws/3wKtmrz

Opening Remarks At OeNB Monetary Policy Panel By Andrew Bailey, Governor, Bank Of England – Given At Oesterreichische Nationalbank, Annual Economic Conference, Vienna
Bank of England
This is a time of very large economic shocks, and particularly very large external shocks, most recently from Russia’s invasion of Ukraine. I say that as someone who wholeheartedly supports the cause of Ukraine and the assistance we must give. We are in a period of rapidly rising energy, goods and some food prices. These are the most visible prices too. This is by far the main cause of high inflation, and is painful, particularly for those less well off. What can and should monetary policy do? There is a very important distinction between: whether monetary policy can anticipate and stop the effects on inflation of shocks; and, if not, whether it should respond when they happen?
/jlne.ws/3NvdP5z

The Pros and Cons of Dollar-Cost Averaging
FINRA
When thinking about investing, one consideration is whether to invest funds all at once or over a period of time. If you choose the latter route, you might be opting for an investment strategy called dollar-cost averaging. With dollar-cost averaging, you invest your money in equal portions, at regular intervals, regardless of the ups and downs in the market.
/jlne.ws/3lDsEqV

SEC Charges BNY Mellon Investment Adviser for Misstatements and Omissions Concerning ESG Considerations
SEC
The Securities and Exchange Commission today charged BNY Mellon Investment Adviser, Inc. for misstatements and omissions about Environmental, Social, and Governance (ESG) considerations in making investment decisions for certain mutual funds that it managed. To settle the charges, BNY Mellon Investment Adviser agreed to pay a $1.5 million penalty.
/jlne.ws/38cfcqW

ASIC disqualifies former Victorian director for breaching directors’ duties
ASIC
ASIC has disqualified James Sackl, of Southbank, Victoria, from managing corporations for three years and six months due to his involvement in the failure of five companies.
/jlne.ws/3yZpGVA

Queensland director disqualified from managing corporations for three years and six months
ASIC
ASIC has disqualified Benjamin David Coventry Brown of Brisbane, Queensland, from managing corporations for three years and six months due to his involvement in the failure of two companies.
/jlne.ws/3yUNmKN

Former Chair, CEO and CFO of Bruck Textile Technologies charged with preventing recovery of employee entitlements
ASIC
On 23 May 2022, Mr Philip James Bart and Mr Ronald George Johnson, the former Chair and Chief Financial Officer of Bruck Textile Technologies Pty Ltd respectively, appeared in Wangaratta Magistrates Court charged with one count each of preventing the recovery of employee entitlements. Mr Geoffrey Thomas Parker, the former Chief Executive Officer, previously appeared on the same charge on 21 March 2022.
/jlne.ws/3PDTrBh

ESMA Study Looks at Reasons for Lower Costs in ESG Funds
ESMA
The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, has published a study looking at the potential reasons behind the relatively lower ongoing costs, and better performance, of environmental, social and governance (ESG) funds compared to other funds, between April 2019 and September 2021.
/jlne.ws/3MCoUSt

FCA response to Amigo’s scheme being approved by the High Court
UK FCA
The High Court today approved Amigo Loans Limited scheme of arrangement (the scheme) to provide redress to customers who are due it for being mis-sold loans and who raise a complaint.
/jlne.ws/3sOuDwH

UK authorities look to strengthen resilience of Money Market Funds
UK FCA
The FCA, jointly with the Bank of England, and with the endorsement of the Treasury, has today published a Discussion Paper on Money Market Fund (MMFs) reform. This seeks views to inform the development of MMF reform proposals. The FCA has also published guidance on the UK MMF Regulation.
/jlne.ws/38MdcGe

Joint Statement of Intent between the Monetary Authority of Singapore and the Swiss State Secretariat for International Finance to Promote Data Connectivity for Financial Services; In recognition of the importance of data connectivity in financial services, the Swiss State Secretariat for International Finance (“SIF”) and The Monetary Authority of Singapore (“MAS”) have agreed on and jointly issue the following statement of intent:
Monetary Authority of Singapore
SIF and MAS recognize the importance of a sound regulatory and policy framework, one that is conducive for the cross-border transmission, storage, processing, access to and protection of data in the financial sector (“data connectivity for financial services”).
/jlne.ws/38GzkBZ

Investing and Trading

Banks and funds stash record $2tn overnight at Fed facility; Investors in search of safe assets flock to overnight reverse repo market
Kate Duguid and Eric Platt – FT
Money market funds and banks parked a record $2.04tn at the Federal Reserve on Monday, underscoring the demand for safe-haven investments as interest rates rise and financial markets whipsaw. The figures disclosed by the Federal Reserve Bank of New York marked the first time that more than $2tn had been tucked away in the Fed’s overnight reverse repurchase facility. While surging demand has in the past been seen as a potential sign of looming problems, it has not raised similar concerns this time, as funds and banks tapping the facility have few other appealing options to store their excess cash.
/jlne.ws/3GaEaU4

Rising Global Food Protectionism Risks Worsening Inflation Woes; Malaysia and India are safeguarding chicken and crop supplies; Around 30 countries curbed exports recently: Fitch Solutions
Low De Wei – Bloomberg
Food protectionism is on the rise in the developing world as governments try to safeguard local supplies, and the effects are threatening to spill over into richer economies. Countries are restricting exports to cope with high prices that have been exacerbated by the war in Ukraine. Malaysia just announced a ban on chicken exports, causing consternation in Singapore, which gets a third of its supplies from there. India has moved to curb wheat and sugar shipments, Indonesia has limited palm oil sales, and some other nations have issued grain quotas.
/jlne.ws/3GdELEG

Now is the time for stockpickers in markets; Best returns can occur when a less cheerful scenario is reflected in security prices
Abby Joseph Cohen – FT
Much has been written about the wicked declines in financial asset prices this year. These commentaries are often framed in the language of technical analysis. For example, has an equity bear market begun?
/jlne.ws/3MDJbHg

Commodity funds stage revival as investors seek inflation hedges; Raw material prices surge as pandemic supply disruptions are compounded by war in Ukraine
Adrienne Klasa – FT
Commodity funds are making a comeback after years out of favour, as institutional investors seek hedges against stubbornly high global inflation. Investment vehicles tied to raw materials such as oil and wheat drew in net inflows of $38.7bn in the year to May 10, building on weekly inflow highs through March, according to data from Citi.
/jlne.ws/3lE9MrU

There Is a Rush for Cash on Wall Street; One piece of evidence is the market’s embrace of dividend-paying companies over firms that do buybacks
Karen Langley, Gunjan Banerji – WSJ
Cash is king right now. The latest evidence: the market’s embrace of dividend-paying stocks over another longtime favorite, firms that do buybacks. Investors are rushing to companies promising regular payouts to shareholders, a sign of Wall Street’s hunger for cash in hand as the Federal Reserve raises interest rates and major stock indexes struggle.
/jlne.ws/3yZ7X0v

Environmental, Social and Corporate Governance

Germany to Bring Back Coal Power Plants If Russia Cuts Off Gas; Government will present emergency decree later Tuesday: Habeck; Move comes even if burning coal will boost carbon emissions
Arne Delfs – Bloomberg
Germany plans to bring back coal- and oil-fired power plants should Russia cut off natural gas shipments to Europe’s largest economy. Economy Minister Robert Habeck will on Tuesday present an emergency decree enabling the government to bring back the facilities in case of gas shortages, according to the proposed legislation seen by Bloomberg.
/jlne.ws/3lFtJ1m

BOE Says Climate Transition Will Cost Finance System Billions
Reed Landberg and William Shaw – Bloomberg
The Bank of England said UK banks and insurers face climate-related losses of £210 billion to £340 billion over the next three decades depending on how quickly the government acts to shift the economy toward net zero emissions. The UK central bank said the financial system is well placed to absorb those losses, though many of them in the worst case scenario will be passed on to consumers, with the poorest people in society hit hardest.
/jlne.ws/38F5Sw9

Maybe There’s No Such Thing as an ESG Stock; The usually dull sector was turned on its head last week by two unlikely events. Together, they point up some thorny contradictions.
Tim Quinson – Bloomberg
The usually mundane world of ESG was turned on its head last week by two sector-shaking events. First, S&P Dow Jones Indices shocked Wall Street by removing Tesla Inc. from the ESG version of the S&P 500 Index. The decision kicked off a huge kerfuffle, with many asking if the electric vehicle maker doesn’t deserve the ESG moniker, than what company does?
/jlne.ws/3wHdA23

Energy Crisis Makes Green Transition an ‘Unprecedented Challenge’; Yergin tells Davos that world has lurched in energy transition; Fortescue sees China steel sector decarbonizing early
Bloomberg News
The world is rethinking its energy transition after a shortage of traditional fuels has left billions either in the dark or paying skyrocketing prices for power. Trying to rapidly deploy clean energy without investing enough in conventional sources has led to a series of lurches in the transition, author Daniel Yergin said at a World Economic Forum panel in Davos on Tuesday.
/jlne.ws/3lDfmL9

Institutions

Top HSBC Venture Capital Dealmaker Leaves to Start New Fund; Ore Adeyemi plans to launch new venture capital firm; Trio departing London-based lender amid tech world turmoil
Jan-Henrik Foerster – Bloomberg
Ore Adeyemi, a top dealmaker in HSBC Holdings Plc’s corporate venture capital arm, is leaving to start his own investment firm with two others from the bank, people with knowledge of the matter said. Adeyemi has been at the bank about 16 years, most recently as managing director and global head of strategic innovation investments based in the San Francisco area. He’s planning to launch a venture capital fund with Tom Bussey, an investment director in the HSBC venture capital group, the people said, asking not to be identified because the information is private.
/jlne.ws/3wQWnSG

HSBC distances itself from comments by an executive downplaying climate risks.; Stuart Kirk, the head of responsible investing for the bank’s asset management division, said the risks of climate change had been overblown. “Who cares if Miami is six meters underwater in 100 years?”
Jenny Gross – NY Times
HSBC is in damage-control mode after a senior executive said policymakers and central bankers had exaggerated the financial risk of climate change. Stuart Kirk, the head of responsible investing for the bank’s asset management division, last week compared predictions about the negative effects of climate change to “Y2K” theories that a computer glitch would cause havoc at midnight on Jan. 1, 2000. “There’s always some nut job telling me about the end of the world,” he said at a Financial Times conference in a presentation titled, “Why investors need not worry about climate risk.”
/jlne.ws/3sRWXyj

JPMorgan Says UK Digital Bank Now Has Almost £8 Billion in Deposits; The JPMorgan Chase & Co. offices in London, UK.; The JPMorgan Chase & Co. offices in London, UK.Photographer: Chris Ratcliffe/Bloomberg
Harry Wilson – Bloomberg
JPMorgan Chase & Co.’s new UK digital lender has attracted more than 500,000 customers and gathered about $10 billion in deposits since launching in September. Chase UK, its British digital-only bank, is “off to a strong start,” JPMorgan said in an investor presentation Monday. But such growth hasn’t come cheap with losses at the US lender’s overseas digital banks likely to exceed $1 billion over the next five years.
/jlne.ws/3Gb1bGE

JPMorgan Plans to Hire 1,300 More Advisers Over Next Three Years
Hannah Levitt – Bloomberg
JPMorgan Chase & Co. plans to hire about 1,300 advisers over the next three years as part of a strategy to boost assets in its wealth-management operation to $1 trillion. The additions would bring the total to 6,000 from about 4,700, Jennifer Piepszak, co-chief executive officer of JPMorgan’s consumer and community banking operation, said at the firm’s investor day Monday. The bank has already added 1,100 advisers since 2017, she said.
/jlne.ws/38i3Ba0

Bill Hwang Ordered to Turn Over Passport After Release on $100 Million Bond
Bob Van Voris – Bloomberg
Bill Hwang didn’t have a passport to hand over when he won release on bail, and a judge is now asking him not to apply for one. In a single-sentence order dated Friday, US Magistrate Judge Katharine Parker modified the terms of Hwang’s $100 million bond agreement to include a clause that he hand over “all travel documents” and “not make any new applications.”
/jlne.ws/3MBQz61

Goldman Staff Outpace Credit Suisse in Return to Office; Bank CEOS talk divide between Europe and US policies at Davos; Goldman staff drifting back to pre-pandemic level in office
Katherine Griffiths and Dale Crofts – Bloomberg
At the first in-person Davos gathering in over two years, one topic among banking bosses was the people not there — workers who are choosing to work from home in the wake of the Covid pandemic. Chief executives who gathered at the Swiss resort showed there is still a divergence of approach about the future of work, even as many countries have rolled out comprehensive vaccine programs and guided people to return to their normal lives.
/jlne.ws/3lAHKO7

Wellness Exchange

China Virus Czar Turns Attention to Beijing as Outbreak Drags on; Capital still reporting dozens of cases a day despite curbs; Government announces tax relief to help prop up economy
Bloomberg News
China’s top official for pandemic control has shifted her attention from Shanghai’s ebbing Covid-19 crisis to Beijing, raising pressure on the capital to contain its lengthy outbreak, and potentially signaling harsher curbs to come. Sun Chunlan, China’s Vice Premier and health czar whose appearance at virus hotspots across the country typically reflects the central government’s priorities, on Monday urged authorities in Beijing to eradicate spread in the community more swiftly and implement more thorough measures adhering to the Covid Zero approach. She inspected the latest areas hit by the virus, according to state media reports, including regions in Beijing’s Haidian district, home to some of China’s top universities.
/jlne.ws/3wFHaVu

Why health officials are less concerned about monkeypox than COVID
Dylan Stableford – Yahoo! News
Public health officials around the world are trying to ease concerns about monkeypox after nearly 100 confirmed cases of the disease were reported in more than a dozen countries worldwide, including the United States. OK, so what is it? How does it spread? And will it be the next pandemic? The answers to those questions and others below.
/jlne.ws/3NBZ0yt

How monkeypox spreads and why current cases are something “we’ve never seen”
CBS News
The monkeypox virus is causing concern among global health experts. While the illness is rarely seen outside Africa, the World Health Organization is reporting more than 90 cases in 12 countries beyond the continent. So far, the Centers for Disease Control and Prevention says there is one confirmed case in the U.S., in Boston, reports CBS News chief medical correspondent Dr. Jon LaPook. There have also been suspected cases in Broward County, Florida, and New York City.
/jlne.ws/3MOnQew

Covid-19 Vaccine and Drug Sales, Once Booming, Plateau; Merck, J&J dial back sales estimates now that supplies are ample and many people are vaccinated
Jared S. Hopkins – WSJ
The gold rush for drugmakers making Covid-19 vaccines and treatments might be over, as demand plateaus, supplies turn ample and the pandemic evolves. Merck & Co. and Johnson & Johnson are among the companies cutting sales expectations for pandemic products this year as they assess the outlook.
/jlne.ws/3yPnn7A

Three Doses of Pfizer’s Covid-19 Vaccine 80% Effective in Young Children, Company Says; The three shots were found effective in preventing symptomatic Covid-19 in children ages 6 months to 5 years old
Jared S. Hopkins – WSJ
Three doses of the Pfizer Inc. and BioNTech SE Covid-19 vaccine were 80% effective at preventing symptomatic Covid-19 and generated a robust immune response in children ages 6 months to 5 years old, the companies said. The vaccine was also found to be safe and well-tolerated among the children in the study, the companies said Monday. Many of the children had received at least some of their shots during the Omicron wave, suggesting that the three-dose series worked well against the highly contagious variant after the two doses produced mixed results.
/jlne.ws/3lEQeU8

Regions

New Bank of Korea Chief Rhee Takes More Vocal Stance on Economy; Rhee more outspoken than predecessor Lee on long-term issues; Governor’s focus ranges from restructuring to demographics
Sam Kim – Bloomberg
New Bank of Korea Governor Rhee Chang-yong is turning out to be more outspoken than his predecessor as he shows a willingness to leverage his position to stimulate debate on economic challenges ranging from inflation to demographics. Rhee made clear ahead of his first policy meeting this week that he will press for higher interest rates to rein in prices, like most of his global peers.
/jlne.ws/3Gch1AF

Australia Pension Investments Lost A$55 Billion in March Quarter
Matthew Burgess – Bloomberg
Australian retirement system assets shrank 0.9% to A$3.4 trillion ($2.4 trillion) in the three months through March as markets were roiled by the prospect of steeper rate hikes and Russia’s increased aggression against Ukraine. The drop was driven by a A$55 billion loss on funds’ investment income, the first drop in two years, as volatility in equity markets increased, according to Australian Prudential Regulation Authority data. Defensive assets like fixed income and property also fell, the figures published Tuesday show.
/jlne.ws/3MMongP

Malaysia Bans Poultry Exports in Latest Food Protection Move
Anuradha Raghu – Bloomberg
The Minister of Agriculture and Food Industries met 12 producers and livestock groups including Leong Hup Poultry Farm Sdn., HLRB Broiler Farm Sdn., PWF Corporation Bhd., and the Federation of Livestock Farmers’ Association of Malaysia on Monday, following a Cabinet meeting that discussed the ban. Malaysia will halt exports of 3.6 million chickens a month from June 1, and investigate allegations of cartel pricing, Prime Minister Ismail Sabri Yaakob said Monday. The move is likely to hit hard in Singapore, which sources a third of its supply from Malaysia, as well as in Thailand, Brunei, Japan and Hong Kong.
/jlne.ws/3ac42mB

India Considers Tax Cut on Soybean and Sunflower Oil to Cool Prices
Pratik Parija – Bloomberg
India is considering cutting an import levy on soybean and sunflower oils, another step in a series of measures the country has taken to cool surging local prices of food. The government is deliberating whether to reduce the agriculture infrastructure and development cess, which is currently 5%, or abolish it, according to a person familiar with the matter. A final decision may be taken this week, said the person, who asked not to be identified as the information is private. A finance ministry spokesperson was not immediately available to comment.
/jlne.ws/3PQNm4L

Malaysia Rules Out Curbs on Cooking Oil Exports, Minister Says; Domestic supplies of palm oil are sufficient: Minister Zuraida; Palm oil output seen jumping to 23-25 million tons this year
Anuradha Raghu – Bloomberg
Malaysia, the world’s second-biggest palm oil producer, has ruled out curtailing cooking oil exports as it has enough supplies to meet local demand and will instead focus on targeting subsidies to ensure it benefits the most needy consumers. “So far, we have no worries because we definitely have no shortages at all,” Plantation Industries and Commodities Minister Zuraida Kamaruddin said in an interview Tuesday. “Most of the time we export more than half of what we produce, and we still have an excess to export,” she said from her office in the administrative capital Putrajaya.
/jlne.ws/3GcZtEu

Russia Loosens More Capital Controls as Ruble Extends Surge
Bloomberg News
The share of foreign-exchange proceeds that exporters are required to sell is being reduced to 50% from 80%, the Finance Ministry said in a website statement. It cited “the stabilization of the exchange rate and the reaching of adequate levels of foreign-currency liquidity on the domestic market.” The ruble is more than 30% stronger against the dollar than it was before Russia sent troops into Ukraine on Feb. 24, triggering harsh sanctions from the US and its allies. The currency’s gains are threatening to hurt budget revenue and exporters.
/jlne.ws/3yU0b89

UK Energy Price Cap Likely to Jump 42% in October, Regulator Warns
Rachel Morison – Bloomberg
The UK’s energy price cap is likely to increase to a record £2,800 in October, just as heating demand starts to pick up at the beginning of winter. Ofgem Chief Executive Officer Jonathan Brearley will write to Chancellor of the Exchequer Rishi Sunak to warn him of the impending increase of more than 800 pounds to bills for about 22 million households, he told a panel of lawmakers on Tuesday.
/jlne.ws/33sAADr

Putin’s State Oil Champion Suffers Biggest Production Drop; Rosneft assets account for 2/3 of decline in Russia production; The company is also leading country’s output recovery in May
Bloomberg News
The state-run oil champion led by a close ally of President Vladimir Putin has seen the largest drop in production since the invasion of Ukraine. Rosneft PJSC, whose Chief Executive Officer Igor Sechin has been part of Putin’s inner circle for decades, along with its subsidiaries account for about two-thirds of Russia’s production cuts since the invasion of Ukraine, data from the Energy Ministry show. That’s about double the company’s share of national output, meaning Rosneft has been affected disproportionately.
/jlne.ws/3yV438L

Egypt Gets Extra $3 Billion in Financing to Cope With Wheat Woes
Abdel Latif Wahba – Bloomberg
A $3 billion increase in funding from the International Islamic Trade Finance Corp. is helping Egypt deal with soaring wheat prices caused by Russia’s invasion of Ukraine, according to an Egyptian official.
/jlne.ws/39Okppx

Cranswick calls on UK government to save pig farming industry; Pork producer says ministers have not acted on suggestions to help sector under ‘unsustainable strain’
Judith Evans – FT
Cranswick, one of the UK’s largest pork producers, has called for government action to save the pig industry after feed price rises added to labour shortages to place farmers under “unsustainable strain”. Adam Couch, chief executive of the listed group, said ministers must do more in the coming months to ensure that the UK had a “viable long-term pig farming industry”.
/jlne.ws/3x4QGAH

Bolsonaro Fires Petrobras CEO After a Month on the Job
Julia Leite and Daniel Carvalho – Bloomberg
The government thanked Jose Mauro Ferreira Coelho, who it nominated in April to lead the oil giant, but said Brazil is living through “challenging times” amid intense volatility of oil prices globally. The administration appointed Caio Mario Paes de Andrade to replace him, according to a note from the Energy Ministry late on Monday. “In order to ensure conditions for job and income growth, it’s necessary to strengthen the private sector’s capacity to invest as a whole,” the note says. “To work and contribute for a balanced scenario in energy is fundamental to generate value for the company, and benefits for society.”
/jlne.ws/3wFabkd

Miscellaneous

Workers in Office Feel Least Connected, Countering RTO Claims; 42% of on-site workers say they feel “not connected” in study; Credit Suisse CEO says banks won’t return to fully in office
Jo Constantz – Bloomberg
CEOs hellbent on getting workers back in the office say that being physically together boosts connectivity. Turns out that’s not the case. Only one in six people feel strongly connected at work, with on-site employees the least connected of all, according to a study Tuesday from consulting firm Accenture Plc. Some 22% of fully remote workers say they feel “not connected,” while the share for those in the office is nearly double.
/jlne.ws/3sVaFjP

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