Hits & Takes
By John J. Lothian
Novel coronavirus and undependable world leaders are the themes today. The coronavirus is dominating the news around the world in 58 countries (and counting). Some medical experts are calling it a pandemic, while some political leaders are saying the threat is overstated or even a “hoax.” Governments, including the U.S. and China, are being challenged about their “basic truthfulness, good faith and responsible stewardship.
The coronavirus outbreak caused the FIA to issue a historic announcement on Friday featuring WHO and CDC recommended restrictions on who they ask not to attend the International Conference in Boca Raton, Florida, starting in a week. Visitors who have traveled to or are from Mainland China, Japan, South Korea, Iran and Italy should stay home. And those who have been in close contact with people mentioned above, or who have the virus, should stay home.
Also, there is a “no hug or handshake” policy in place. I suggest the air fist-bump, where your fist bump runs parallel to the person opposite’s fist bump. Lastly, there will be lots of hand sanitizer around and attendees will be offered an N95 face mask at the registration desk.
Other conferences are being cancelled. IHS Markit cancelled an energy conference planned for March 9 in Houston. Some banks are restricting employee travel or asking visitors from impacted countries to reschedule meetings. JP Morgan said all non-essential international travel should be cancelled and Goldman Sachs is cancelling conferences and “powering up” a parallel trading floor, according to a WSJ report. News Corp., owner of the Wall Street Journal, is also cancelling all non-essential travel, not just international.
President Trump has blamed the media and the Democrats for exaggerating the threat of coronavirus, and at an election rally he called it a hoax. He is not the only politician to ever underestimate an epidemic, but this blame the messenger strategy is not helping calm the markets. President Trump is ignoring the lessons of the 1918 flu pandemic that killed millions, a historian said in a good read from the Washington Post. Even better is this 2017 piece from Smithsonian Magazine about “How the Horrific 1918 Flu Spread Across America.
In U.S. Presidential news, former hedge funder Tom Steyer and former South Bend Mayor Pete Buttigieg left the race for the Democratic nomination for president after getting their butts kicked in the South Carolina primary by Joe Biden.
JLN’s Airbnb reservation for Boca Raton has been cancelled due to a change in policy in Boca for short-term rentals. Argh!~JJL
Coronavirus Spreading Faster Outside China Than Within; Global death toll surpasses 3,000, as new cases jump in Italy, Iran and South Korea
Lucy Craymer – WSJ
The global death toll from the novel coronavirus surpassed 3,000 Monday, as new cases jumped in Italy, Iran and South Korea and three more nations reported their first confirmed patients.
*****Journalists who can do math are very special.~JJL
One of the World’s Largest Energy Summits Canceled on Virus
Simon Casey – Bloomberg
CERAWeek by IHS conference in Houston called off by organizers; ‘Spread of COVID-19 is moving quickly around the world’: IHS
One of the world’s largest and most important energy industry gatherings was canceled by organizer IHS Markit Ltd. on Sunday amid mounting concerns about the coronavirus outbreak. It was due to start March 9.
*****They decided better safe than sorry.~JJL
Eventus Systems Appoints Capital Markets Veterans to Key New Roles
Eventus Press Release
Eric Einfalt Joins as Chief Strategy Officer, David Mitchell as Regional Sales Executive, North America
Austin-based Eventus Systems, Inc., a multi-award winning global trade surveillance and market risk software platform provider, today announced the appointment of two executives to key new roles at the firm. Eric Einfalt has joined as Chief Strategy Officer, and David Mitchell as Regional Sales Executive, North America. Together, they bring more than 45 years of financial services and markets experience.
*****As previously reported by JLN.~JJL
Sanctioned Again; Spoofing; Denied Again; Bitcoin ETF
Gary DeWaal – Bridging the Week
A proprietary trading firm was sanctioned by a sixth futures-industry regulator for purported spoofing trades by one of three employees many years ago. For the employees’ aggregate alleged misconduct, the firm was first penalized by two CME Group exchanges in 2016, by the Commodity Futures Trading Commission and two different CME Group exchanges in 2018, and now again by ICE Futures U.S. Separately, for the seventh time since March 2017, the Securities and Exchange Commission denied approval of an exchange rule to permit trading of a bitcoin-referenced exchange-traded product. The message seems undeniably clear: no means absolutely no when it comes to bitcoin!
Friday’s Top Three
Our most read story Friday was Bloomberg’s Singapore Emerges as Litmus Test for Coronavirus Containment. Second was Nearly 40% of beer-drinking Americans won’t buy Corona due to coronavirus, study shows, From NBC4i.com. I am a bit skeptical of the way the article reported this study – it also says “Among those who said they usually drink Corona, only 4 percent said they would stop drinking Corona.” (And I’m guessing that 4 percent was very drunk.) Third was the web site of Kalshi, a privately held event exchange based in San Francisco that applied to the CFTC for registration as a designated contract market late last year.
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|CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.Recently Updated Pages
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Wall Street Scrambles to Harden Virus Defenses; The outbreak of coronavirus promises a fresh test of logistics planning efforts that have been gradually upgraded over the years.
Rachel Louise Ensign, Liz Hoffman and Justin Baer – WSJ
U.S. banks are preparing for a worsening coronavirus outbreak by laying plans to move staffers to back-office sites, limiting contact with clients who have been abroad and curbing employee travel. Morgan Stanley, whose New York City stock-trading floor is the country’s busiest, is preparing a backup site in suburban Westchester County. JPMorgan Chase JPM -4.33% & Co. has nixed all nonessential international trips. Goldman Sachs Group Inc. GS -1.80% is canceling some conferences and evaluating powering up a parallel trading floor in Greenwich, Conn.
The Fear Is About More Than the Coronavirus; Covid-19 has exposed deep-seated anxieties about markets and political systems around the world.
Tyler Cowen – Bloomberg
The sudden and dramatic drop of the markets — the S&P 500 down 11% last week — cannot be completely explained by fear about the coronavirus. Even if Covid-19 proves relatively deadly, it is not obvious it will lower longer-term corporate earnings by 11%. And it is plausible, though by no means assured, that a vaccine could be ready within a year.
Outbreak starts to look more like worldwide economic crisis
Adam Geller, Paul Wiseman, Christopher Rugaber – AP
The coronavirus outbreak began to look more like a worldwide economic crisis Friday as anxiety about the infection emptied shops and amusement parks, canceled events, cut trade and travel and dragged already slumping financial markets even lower.
U.S. officials talk down coronavirus market panic, tout economic strength
Michelle Price – Reuters
Senior officials in President Donald Trump’s administration on Sunday tried to calm market panic that the coronavirus could cause a global recession, saying the U.S. public had over-reacted and that stocks would rebound due to the American economy’s underlying strength.
China Fails the Leadership Test on Coronavirus; Global leaders must build a reputation for basic truthfulness, good faith and responsible stewardship.
Hal Brands – Bloomberg
Global health crises are geopolitical events, and the spread of the Wuhan coronavirus is no exception. That incipient pandemic is not simply testing the global health system. It is also an acid test for a Chinese regime that intends, in the words of President Xi Jinping, to “take center stage in the world.”
To Defeat Coronavirus, Win the Containment Battle; New research suggests the usual methods aren’t going to be enough in countries reporting outbreaks of the disease.
Mark Buchanan – Bloomberg
The coronavirus epidemic keeps defying predictions. In the last few days, significant new outbreaks have been reported in Iran, South Korea and Italy. Authorities in all three nations have locked down cities and restricted travel in an effort to contain it. The total number of confirmed infections globally is now nearly 80,000, and the number of unknown infections may be much larger.
Virus uncertainty rules, but markets functioning OK: BIS
Marc Jones – Reuters
The Bank for International Settlements said on Sunday that financial markets had functioned resiliently during last week’s coronavirus-sparked sell-off and this was a sign that post-crisis reforms were doing their job.
OECD warns coronavirus could halve global growth; Central bankers say they are ready to act if needed to mitigate economic impact of the outbreak
Chris Giles, Sam Fleming and Martin Arnold – FT
The OECD sounded the alarm about coronavirus on Monday, warning that it could halve global economic growth this year from its previous forecast.
Banks prepare off-site trading in response to virus threat; BoE working with international partners to ‘protect financial and monetary stability’
Katie Martin, Olaf Storbeck, Laura Noonan, David Keohane – FT
Europe’s banks and asset managers are stepping up preparations to keep teams trading in the face of the coronavirus outbreak, with several companies standing ready to shift staff to off-site locations.
How the coronavirus shattered market complacency; Shrugging off risks at the start of the year has proven costly
Robin Wigglesworth, Katie Martin and Tommy Stubbington – FT
The past week was a wake-up call for investors who had assumed the smooth ascent of global stock markets would stretch into 2020.
A Kiss Is Just a Kiss Except When It Spreads the Coronavirus
Thomas Mulier and Marthe Fourcade – Bloomberg
Some experts recommend avoiding physical contact in greetings; Warnings come as the coronavirus gains traction in Europe
King Henry VI of England banned kissing in 1439 to battle the plague. As the world confronts the coronavirus spreading from China, some health authorities are again urging people to refrain from physical displays of affection.
Public health experts call coronavirus a ‘pandemic’; Doctor treating US cases says hospitals should prepare for surge of patients
Brendan Greeley – FT
Three public health experts, including a former member of the National Security Council treating 15 coronavirus patients in Nebraska, have called the outbreak a “pandemic” — suggesting hospitals across the US must prepare for a surge of patients.
Rhode Island, New York announce first coronavirus cases
Emily Brindley – Hartford Courant
The Rhode Island Department of Health announced on Sunday that the state has its “first presumptive positive case” of COVID-19, the 2019 coronavirus disease. The Associated Press reported late Sunday that New York City also has its first confirmed case.
Italy Cases Rise 50%; Seattle Has More Infections: Virus Update
U.S., Japan Warn on travel; Houston energy meeting scrapped; U.S., Australia, Thailand report deaths; Mideast markets slide
Italy had a 50% surge in new coronavirus cases and 34 deaths as the outbreak reached more than 65 nations. The U.S. and Japan issued “do-not-travel” warnings for regions of Italy and South Korea.
Avoiding Coronavirus May Be a Luxury Some Workers Can’t Afford; A sick day? Remote work? Not so easy if your job is at a restaurant, a day care center or a construction site.
Claire Cain Miller, Sarah Kliff and Margot Sanger-Katz – NY Times
Stay home from work if you get sick. See a doctor. Use a separate bathroom from the people you live with. Prepare for schools to close, and to work from home. These are measures the Centers for Disease Control and Prevention has recommended to slow a coronavirus outbreak in the United States.
Chinese Oil Trading Giant Tells London Employees to Work at Home
Sherry Su and Laura Hurst – Bloomberg
Unipec staff in London work from home after employee fell ill; Separately, Chevron employee found not to have coronavirus
Chinese oil trading giant Unipec told its London staff to work from home after an employee fell ill with virus-like symptoms, according to people familiar with the matter.
Companies are canceling U.S. domestic travel over coronavirus fears; Facebook and Amazon are among the companies rethinking employee travel as the outbreak intensifies
Abha Bhattarai – Washington Post
Major companies are beginning to cancel conferences and travel plans within the United States due to the coronavirus, which analysts warn will have cascading impacts on the country’s hotels, airlines and convention centers.
U.S. Surgeon General Urges People to ‘Stop Buying Masks’
Hailey Waller – Bloomberg
Masks aren’t effective in preventing spread of virus, he says; FDA allows labs to use tests they develop faster to test virus
The U.S. Surgeon General urged people to “stop buying masks,” saying on Twitter that they’re not effective in preventing the general public from catching coronavirus.
Exchanges, OTC and Clearing
New York Stock Exchange considers shutting trading floor amid coronavirus fears as Wall Street firms tell workers to prepare to work from home
Ralph R. Ortega – DailyMailcom
The New York Stock Exchange is considering closing its trading floor amid concerns the coronavirus outbreak will spread into a wider pandemic; Wall Street firms already have started restricting travel and advising workers they may have to work from home; Most trading is done electronically and few traders actually still report to the trading floor, which is closed and will not reopen until Monday
Coronavirus (COVID-19); trading from emergency locations
In the context of events that might occur in connection with the spread of the coronavirus (COVID-19), Eurex would like to inform that Trading Participants, in case of an emergency situation, can participate in trading at Eurex Deutschland from outside their notified and approved trading locations (§ 33 in conjunction with § 55 (1) of the Exchange Rules of Eurex Deutschland).
Eurex enables global ESG investing with new MSCI index-based derivatives
New futures using MSCI ESG Screened Indexes launched covering USA, World, EM, EAFE and Japan; Growth in MSCI index-based derivatives driven by buy-side demand; Trading starts in time for the next roll in March
Amid the strong worldwide trend towards responsible investing, Eurex is supporting asset managers in switching to sustainable investments by broadening its ESG segment and expanding its range of ESG derivatives to markets beyond Europe. As of today, five new Eurex futures will cover the sustainable versions of key regional and global MSCI benchmarks.
Nasdaq Dubai Welcomes Listing Of USD Two Billion Sukuk By Islamic Development Bank
Nasdaq Dubai welcomed the listing of a two billion US dollar Sukuk by Islamic Development Bank (IsDB), the multilateral lender which finances development across its 57 member countries.
Tokyo Financial Exchange: Application Of Intraday Additional Margin Call
Today, Tokyo Financial Exchange (TFX) applied the Intraday Additional Margin Call of Interest-rate Futures contracts for the first time since 1 february 2016 as the Three-month Euroyen futures market soared.
Exchange Updates and Streamlines Guidance Materials
The Stock Exchange of Hong Kong Limited (the Exchange), a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (HKEX), today (Friday) updated three Guidance Letters and eight sets of Frequently Asked Questions (FAQs), and withdrew 15 Guidance Materials.
TMX Group Limited Normal Course Issuer Bid Approved
TMX Group Limited (“TMX Group”) announced today that its normal course issuer bid (“NCIB”) has been accepted by Toronto Stock Exchange (“TSX”).
Goldman Sachs Joins ICE ETF Hub for Enhanced Access to ETF Primary Market
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, today announced that Goldman Sachs has connected to ICE ETF Hub as an authorized participant on the platform.
London Stock Exchange Group Directorate Change
London Stock Exchange Group
London Stock Exchange Group plc (LSEG) today announces that Dr. Ruth Wandhöfer, Non-Executive Director, will step down from the Board of LSEG with immediate effect to pursue new opportunities. Don Robert, Chairman, LSEG, said “On behalf of the Board, I’d like to thank Ruth for her contribution to the Group and we wish her well in her new ventures.”
Trading Overview in February 2020; Japan Exchange Group released Trading Overview in February 2020
Cash Equity Market – In February 2020, the daily average trading value for the TSE 1st Section (domestic common stocks) was JPY 2.9748 trillion.
Derivatives Market – (OSE)- In February 2020, total derivatives trading volume was 43,421,093 contracts, which were the highest number for February.
The Spanish Exchange Traded 37.88 BN Euros In February
The Spanish Stock Exchange traded 37.88 billion euros in Equities in February, up 17.2% from the same period in 2019 and up 4.4% from the previous month. The number of trades in February reached 4.16 million, up 49.1% from the same period a year earlier and up 23.9% from the preceding month.
Boerse Stuttgart records February turnover of around EUR 10,5 billion; All asset classes show significant increase in trading volume // Highest monthly turnover since March 2015
Based on the order book statistics, Boerse Stuttgart generated turnover of around EUR 10,5 billion in February 2020. Compared to the same month of the previous year this is an increase of over 101 per cent and the highest level since March 2015.
Gold Futures Trading on DGCX Spikes Amidst Uncertain Global Economic Backdrop
The Dubai Gold & Commodities Exchange (DGCX) last month saw its flagship Gold Futures product continue its strong start to the year, with year-to-date (Y-T-D) volume growth of 773.6% compared to the same period last year, aided by a multi-year record in January. The spike in trading is a response to a global backdrop of economic uncertainty, with investors increasingly looking towards safe-haven assets. Total volumes on the DGCX in February hit 1.49 million contracts, while Y-T-D Average Open Interest (AOI) was 367,878 contracts, up from 243,409 a growth of 51.1% during the same period in 2019.
Central banks are contemplating a world without cash
John Detrixhe – Quartz
Cash may not always be king. That’s why, as apps and payment cards become more popular, officials at central banks are considering how and whether to create a digital form of cash.
LendingTree CEO is worried about a fintech bubble
Austin Weinstein – Charlotte Observer
LendingTree CEO Doug Lebda says that, despite recent mega-deals in the financial technology space, the loan marketplace he founded isn’t for sale.
In February, two huge acquisitions shook up the marketplace in finance, with Morgan Stanley announcing a deal to buy trading platform E-Trade for $13 billion and Intuit disclosing plans to buy personal finance firm Credit Karma for $7 billion. LendingTree, though, doesn’t appear poised to join the party.
Santander to acquire fintech from its Brazilian unit: filing
Carolina Mandl – Reuters
Banco Santander Brasil SA (SANB11.SA) has reached an agreement to sell its financial startup Superdigital to a European subsidiary of Spain’s Banco Santander SA for 270 million reais ($61.53 million), according to a filing on Friday.
The top issues in fintech, according to the industry’s biggest players
Adam Lashinsky and Aaron Pressman – Fortune
With humility and a tad of dark humor about how the world was falling apart around us, several Fortune writers and I hosted a dinner Thursday night in an unseasonably warm San Francisco to talk about fintech. We gathered a who’s who of the technologically savvy companies that are trying to reinvent financial services: Andreessen Horowitz, Ant Financial, Brex, Calibra, Coinbase, Honey, Plaid, Ripple, Ribbit Capital, Robinhood, SoFi, Square, Stripe, and more.
Every company is a fintech company in some way
Adam Lashinsky and Aaron Pressman – Fortune
For someone who proclaimed that fintech’s days are limited, I spent a lot of time last week talking about fintech. My thesis isn’t that fintech isn’t a thing, but rather that one day all finance will incorporate tech and also that the incumbent financial services companies already have some fearsome advantages.
Binance is preparing to launch crypto options trading later this year
Yogita Khatri – The Block
Crypto exchange Binance has been preparing to launch trading in options contracts for later this year,
Coinbase yet to receive an operating license in Japan
Yogita Khatri – The Block
U.S.-based crypto exchange Coinbase is yet to receive an operating license in Japan, but appears to have moved one step closer to get one.
Ethereum community members submit dissenting ProgPoW petition
Aislinn Keely – The Block
Members of the Ethereum community published a petition on Wednesday indicating a level of stakeholder dissent against the activation of ProgPoW, a proposal that seeks to transition Ethereum’s hashing algorithm to an ostensibly ASIC-resistant scheme.
The Libra Association is weighing a shift to a U.S. dollar-backed stablecoin
Frank Chaparro – The Block
The Libra Association is considering whether to abandon the existing currency-and-asset basket model in favor of a dollar-centric one for its proposed Libra stablecoin, sources say
West Virginia Ditches Blockchain Voting App Provider Voatz
Sebastian Sinclair – Coindesk
Voatz, the blockchain-based voting app that was recently claimed by researchers to have vulnerabilities, will no longer be used in West Virginia’s coming elections. On Saturday, NBC News reported that West Virginia’s secretary of state, Mac Warner, had announced that disabled and overseas voters would not, after all, be able to vote with mobile applications during the state’s primaries. Instead, they will have to use a service by Democracy Live, which allows users to fill out a ballot online and return it via post.
Who Needs Cryptocurrency FedCoin When We Already Have A National Digital Currency?
David B. Black – Forbes
The cryptocurrency enthusiasts are at it again, with a new name and even more ambitious goals than before: now they want a “national digital currency.” Hurry! The Chinese will beat us to it, and we’ll be left behind! Somehow, no one in the debate acknowledges the obvious fact that we already HAVE a national digital currency. It’s fast, cheap and secure! It has no issue with regulators, and it’s accepted everywhere. Who knew?
Yemen’s Civil War Shows the Dangers of Crypto
Leigh Cuen – Coindesk
Yemen, home to what the United Nations calls the world’s biggest humanitarian crisis, is in a state of civil war. Half of the country is controlled by the Iran-backed Houthi militant group, which has developed its own cryptocurrency. People from Yemen are often wary of being associated with cryptocurrency, in part because of the Houthis’ crypto efforts. Despite the potential advantages of a trans-national, censorship-resistant cryptocurrency in the country, connectivity issues make it very hard to get bitcoin into this war zone. “It’s too soon for bitcoin,” one researcher said.
Halting $9.8 Billion in Theft Is Key to Crypto Growth, KPMG Says
Matthew Leising – Forbes
The cryptocurrency market needs to improve how it secures digital assets for the $245 billion industry to keep growing, according to KPMG. At least $9.8 billion in digital assets have been stolen by hackers since 2017 because of lax security or poorly written code, the accounting firm wrote in a report released Monday. Adoption of cryptocurrencies such as Bitcoin and Ether among institutional investors has led to competition for a place in portfolios, making safeguarding the tokens more important that ever, KPMG said.
Ripple would not be profitable without selling XRP, says CEO Garlinghouse
Yogita Khatri – The Block
Ripple CEO Brad Garlinghouse has indicated that XRP sales form a significant chunk of the company’s profitability. “We would not be profitable or cash flow positive [without selling XRP],” Garlinghouse was quoted as saying in a Financial Times report published Friday. “Well XRP is one source. I don’t know how to answer that because if you took away our software revenues, that would make us less profitable. If you took away all our XRP, that makes us less profitable. So I don’t think about it as one thing,” Garlinghouse added.
Crypto Exchange Huobi’s DeFi-Focused Blockchain Released in Public Beta
Paddy Baker – Coindesk
Huobi believes its upcoming blockchain will provide financial institutions with a framework for decentralized finance (DeFi) applications and services. The Singapore-based cryptocurrency exchange announced Saturday that its proprietary network, Huobi Chain, had been successfully deployed on its testnet. Developed in collaboration with layer-1 protocol provider Nervos, Huobi says its new blockchain will allow businesses and regulators to determine the rules of the road for the emerging DeFi space.
Cryptocurrency users failing to file AML forms may face trouble this tax season
Jude Lopez – AMB Crypto
With cryptocurrencies like Bitcoin gaining in adoption and mainstream recognition, the IRS has added measures to ensure that crypto traders pay their fair share of taxes this tax season. With over a month left to file tax returns in the US, many crypto users continue to find the process harrowing with regard to appropriately reporting their crypto activity and gains. In a recent episode of the Epicenter podcast, Clinton Donnelly, Founder of CryptoTaxAudit, spoke about the intricacies in crypto-tax, the importance of tax amnesty and highlighted some of the biggest mistakes crypto-users tend to make when it comes to filing their tax returns.
Malta Regulator Clarifies Legal Status of Binance
Samuel Haig – Cointelegraph
In a recent interview, a Malta parliamentarian has sought to clarify the legal status of top cryptocurrency exchange Binance within the island country. Speaking to Cointelegraph, Malta’s Junior Minister for Financial Services and Digital Economy, Bartolo Clayton, reaffirmed that Binance has never been licensed in the jurisdiction: “As informed by the Malta Financial Services Authority, which is an autonomous body not a state entity, until the time of writing, Binance has never been in possession of an official license by MFSA. Such statement has been further corroborated by Changpeng Zhao, CEO of Binance, on his personal Twitter account where he also stated that Malta has not changed its position.”
Crypto traders report increased selling pressure ahead of Monday’s open
Frank Chaparro – The Block
Cryptocurrency investors and traders were working late into the day Sunday, preparing for global stock markets to re-open on Monday. Assets ranging from oil to copper to bitcoin dropped precipitously throughout last week’s trading session as fears tied to the spread of coronavirus gripped markets. The market rout in U.S. equities extended into correction territory, pulling back by more than 10% over the course of last week. Bitcoin has shed an additional 2.2% since U.S. markets closed on Friday, trading down more than 11% since Monday.
Trump announces new travel restrictions amid spread of coronavirus
Morgan Chalfant, Jessie Hellmann – The Hill
President Trump on Saturday further restricted travel from Iran and advised American citizens not to travel to specific regions in Italy and South Korea in response to the coronavirus.
How Do You Solve a Problem Like Fannie and Freddie? FHFA chief Mark Calabria’s decisions could rock a $5 trillion mortgage market and make a lot of money for hedge funds.
Elizabeth Dexheimer – Bloomberg
As the director of the U.S. Federal Housing Finance Agency, Mark Calabria has a relatively low-profile job. He’s the designated watchdog for a small group of financial institutions, most notably the mortgage giants Fannie Mae and Freddie Mac, which have been under government control since the financial crisis. But as the Trump administration moves to take both companies out of conservatorship, Calabria is for the moment one of Wall Street’s most powerful and closely watched regulators.
Warren Vows to Hold Wall Street Accountable for Climate Crisis
Misyrlena Egkolfopoulou – Bloomberg
Proposal aims to rein in financing for fossil-fuel industry; Warren would ask Fed, SEC to rein in banks, asset managers
Democratic presidential candidate Elizabeth Warren said she would hold Wall Street banks, asset managers and insurance companies accountable for their contributions to climate change.
Anyone Breaking Singapore’s Virus Rules Won’t Get Second Chance
Joyce Koh – Bloomberg
Law minister highlights need for everyone to cooperate; Singapore has more than 90 confirmed cases of coronavirus
Singapore’s warnings that it will take strong action against people who break special rules to counter the spread of coronavirus aren’t just empty threats.
U.S. postpones Asian summit in Las Vegas amid coronavirus fears; A White House visit by Austria’s chancellor scheduled for March 3, was also postponed on Friday,
Josh Lederman and Carol E. Lee – NBC
The Trump administration has called off a major summit of Asian leaders next month in Las Vegas amid growing alarm over the coronavirus, two U.S. officials tell NBC News. The United States had planned to host a special summit of ASEAN, the Association of Southeast Asian Nations, on March 14.
Dani Garavelli: Pandemic of mistrust in lying leaders goes global; Panic over the spread of COVID-19 is made far worse by the agendas of populist politicians, writes Dani Garavelli.
Dani Garavelli – The Scotsman
At first, when news about the coronavirus (COVID-19) started circulating, the World Health Organisation praised China for its speedy response. But then doubts about country’s handling of the early cases began to creep in. A shocking story that seemed to point to a cover-up emerged. A doctor, Li Wenliang, had raised the alarm about a new SARS-like virus spreading in Wuhan province in December, but was detained with several others for “rumour-mongering”. Li went on to become one of the 80,000 Chinese citizens who have contracted the virus, and one of the 3,000 who have died from it.
Trump Counts on the Fed to Shore Up Markets, Keeping Up His Pressure Tactics; President urged central bank on Saturday to be a leader amid coronavirus fears
Nick Timiraos – WSJ
President Trump said he is counting on the Federal Reserve to shoulder the government’s response to economic disruptions caused by the coronavirus, renewing the pressure campaign he has used against the central bank during previous bouts of market uncertainty.
New NOAA Hurricane Dorian emails show how tenuous scientific credibility is in the Trump era; The documents come just as the CDC and NIH go to battle against coronavirus.
Andrew Freedman and Jason Samenow – Washington Post
New emails released from the National Oceanic and Atmospheric Administration (NOAA) show how much concern there was within the agency, and how much questioning and anger from the outside, regarding the credibility of its critical-to-life hurricane forecasts as a result of actions taken during Hurricane Dorian last fall.
Financial transaction tax: Has the chance for Democrats finally arrived?
Ben Werschkul – Yahoo Finance
In 1914, the United States imposed a transaction tax on all sales or transfers of stock. It was phased out in 1966. Since then, many progressives have been hoping to bring it back.
SEC Power to Recoup Illegal Gains Put at Risk in High Court Case
Greg Stohr, Benjamin Bain, and Robert Schmidt – Bloomberg
Supreme Court to hear arguments on ‘disgorgement’ orders; Commission returns most ill-gotten gains to harmed investors
The Securities and Exchange Commission is bracing for a U.S. Supreme Court ruling that could eviscerate one of the agency’s most potent weapons by slashing its power to recoup billions of dollars in illegal profits from wrongdoers.
Why Won’t the CFTC Let You Take a Position on the Election? The commission prohibits political bets except those under $850 and for ‘research purposes.’
Max Raskin – WSJ
As the country barrels toward Super Tuesday, there are many ways to make money from the 2020 presidential election. If you think Sen. Bernie Sanders is going to win, you could short luxury-goods manufacturers. Or if you’re betting on Sen. Elizabeth Warren’s chances, you could plan to buy shares of Ancestry.com in the event that the DNA testing company’s long-rumored IPO finally takes place.
Charges laid against former credit representative in relation to breach of ASIC banning order
On 25 February 2020, the matter of Shiv Prakash Sahay was mentioned in the Downing Centre Local Court of NSW. Mr Sahay has been charged with breaching an ASIC banning order.
ASIC releases information sheet on document production guidelines
ASIC has today released an information sheet covering document production guidelines for people who produce books, including documents and any other record of information, to ASIC in connection with investigations or surveillance activities.
MiFID II: ESMA makes available the results of the annual transparency calculations for equity and equity-like instruments
The European Securities and Markets Authority (ESMA) had today made available the results of the annual transparency calculations for equity and equity-like instruments.
Proposed Rule Change to Modify the Trade Reporting Fees Applicable to Participants that Use the FINRA/NYSE Trade Reporting Facility
Financial Industry Regulatory Authority, Inc. (“FINRA”) is filing with the Securities and Exchange Commission (“Commission”) a proposed rule change to amend FINRA Rule 7620B (FINRA/NYSE Trade Reporting Facility Reporting Fees) to modify the trade reporting fees applicable to participants that use the FINRA/NYSE Trade Reporting Facility (“FINRA/NYSE TRF”).
Investor Tips For Turbulent Markets
When the stock market gets rocky, focusing on your overall financial picture, combined with sound planning, can pay dividends. These 5 steps can help steady your pulse during market downturns and elevate your financial security:
Fee Rate Advisory #3 For Fiscal Year 2020
Pursuant to Section 31(j)(2) of the Securities Exchange Act of 1934, the Commission has determined that a mid-year adjustment to the Section 31 fee rate for fiscal year 2020 is not required. These adjustments do not directly affect the amount of funding available to the SEC.
SEC Charges Cardinal Health With FCPA Violations
The Securities and Exchange Commission today announced that Ohio-based pharmaceutical company Cardinal Health, Inc. has agreed to pay more than $8 million to resolve charges that it violated the books and records and internal accounting controls provisions of the Foreign Corrupt Practices Act (FCPA).
SEC Awards More Than $7 Million to Whistleblower
The Securities and Exchange Commission today announced an award of more than $7 million to a whistleblower whose information and assistance were critically important to the success of an enforcement action. The whistleblower provided extensive and sustained assistance, such as identifying witnesses.
Investing and Trading
Market Technicians Think the Selloff Isn’t Over; Investors and analysts who study how different players in the market spread their bets calculate that markets have room for further declines
Paul J. Davies and Julie Steinberg – WSJ
After such a bad week for stocks, the question is whether the worst is over. In the view of analysts of more technical corners of the markets, the answer is: probably not yet.
Commodity Indexation and Financialization: The Debate Goes On Because the Literature is Flawed
A recent RFS paper by Brogaard, Riggenberg, and Sovich purports to show that the rise of commodity index investing has had adverse effects on the real economy. Like most of the papers that analyze index investing, this one is seriously flawed and does not support the broad conclusions it asserts.
A $30 Oil Price Is the Real Virus Threat to OPEC; The oil cartel and its international partners will undoubtedly agree to productions cuts this week. But will they be big enough?
Julian Lee – Bloomberg
It’s finally upon us. The week when ministers from the oil producing countries of OPEC and their allies meet to decide on the future of their latest round of output cuts. Having failed to persuade Russia to bring the meeting forward, Saudi Arabia will now hope to convince its biggest non-OPEC ally of the need to make deeper cuts in the face of a demand slump triggered by the Covid-19 virus. Success is not a foregone conclusion and failure will be costly.
Oil Looks Into Abyss as Virus Threatens Demand Contraction
Javier Blas – Bloomberg
Vitol is modeling one scenario based on a global recession; Oil hedge funds buy $40 put options to profit from demand hit
Flights canceled in Europe, schools closed in Japan, towns quarantined in Italy and panic in California. The coronavirus crisis has gone global, and with it, its impact on energy demand.
‘Fear Factor’ Running High With Global Rate-Cut Bets Mounting
Netty Idayu Ismail, Liz McCormick, and Filipe Pacheco – Bloomberg
Central banks will seek cue from the Fed first, NatWest says; ‘Risk-free assets are getting scarce,’ says Axicorp’s Innes
Traders bracing for another rough week sought refuge in haven assets, sending global bond yields down to new record lows.
Markets Have Three Virus Scenarios to Consider; A model published by the World Health Organization in 2017 that estimates the economic fallout from pandemics should give investors comfort.
Aaron Brown – Bloomberg
The coronavirus seems to be near the tipping point of becoming a global pandemic. The next few weeks may see infection rates peak for the virus that causes a lung illness dubbed Covid-19 and start to decline, aided by containment efforts and warmer weather in the Northern hemisphere. It seems just as likely that won’t happen, which means that in addition to humanitarian concerns, investors have to think about the impact on their portfolios.
Currency Traders Are Missing the Details in This Rout; In bidding up the Japanese yen and selling down the Indonesian rupiah, well-worn investment themes are starting to look a little tired.
Shuli Ren – Bloomberg
Stereotypes are difficult to shake, especially in times of distress. As hard as central bankers and politicians try to change them, the old rules of investing still apply.
Coronavirus Hits Once-Isolated U.S. Natural Gas Market; Epidemic deals latest blow to domestic producers, exposing global links developed since start of shale boom
Ryan Dezember – WSJ
Fears that the new coronavirus might slow the global economy have sent already-depressed natural gas prices tumbling to their lowest level in years.
Another Bad Week for Markets Will Force the Fed’s Hand; Like it or not, central bankers can’t let Wall Street slide indefinitely. That likely means a rate cut sooner rather than later.
Tim Duy – Bloomberg
The Federal Reserve finally succumbed to rising pressure from financial markets that have been roiled by the widening coronavirus crisis with its pledge Friday to “act as appropriate to sustain the expansion.” I suspect central bankers hope the move will buy them enough time to forestall a rate cut until the March meeting. It’s not obvious yet that they will get that time. Another week of free-falling markets would force their hand on an inter-meeting cut.
Coronavirus Accounting Is Looking Vulnerable; Is there too much testing going on, or too little?
Lionel Laurent – Bloomberg
The daily counting of new coronavirus cases has become a grim fixture for politicians, investors and the public. The latest figures suggest the infection is past its peak in China, where cases appear to have plateaued. But it’s spreading fast elsewhere. Italy, which emerged as the epicenter of the virus in Europe last month, posted a 50% jump in confirmed cases on Sunday to 1,694 — more than any other country bar China and South Korea — while France’s rose 30% to 130. Swathes of Northern Italy are in lockdown, while France has banned big public gatherings and advised against la bise.
British hedge fund billionaire Hohn launches campaign to starve coal plants of finance
Matthew Green – Reuters
British hedge fund billionaire Chris Hohn has launched a campaign to persuade central banks to starve hundreds of planned coal-fired power plants around the world of finance, aiming to block the projects before they can pose a threat to the climate.
Goldman Sees Virus as Largest Commodity Demand Shock Since 2008
Serene Cheong – Bloomberg
The world is facing the biggest commodity demand shock since the global financial crisis as the coronavirus outbreak that’s already rocked Asia spreads to the U.S. and Europe, according to Goldman Sachs Group Inc.
JPMorgan Sees a $1.2 Trillion Reason to Nix a U.S. Yield Rebound
Cormac Mullen – Bloomberg
Short duration positions from banks could increase bond demand; Strategists say purchases could limit any increase in yields
Banks likely hold the equivalent of $1.2 trillion worth of short positions in 10-year Treasuries, suggesting any rebound in yields could be capped if they cover their bets, according to JPMorgan Chase & Co.
Barclays Shareholder Calls for CEO to Leave Over Epstein Links; Sherborne Investors said the bank’s board should reverse its decision to recommend Jes Staley for re-election
Simon Clark – WSJ
Barclays PLC Chief Executive Jes Staley came under renewed pressure Monday after an activist investor called on the bank to withdraw its support for its American CEO because of his professional relationship with the late financier and convicted sex offender Jeffrey Epstein.
Steve Cohen’s Point72 Hedge Fund Posts February Gain, Rising Nearly 1%
Michael McDonald and Katia Porzecanski – Bloomberg
Steve Cohen’s Point72 Asset Management gained almost 1% in February, amid a market rout that saw the S&P 500 Index tumble, according to people with knowledge the matter.
Hedge Funds Finally Do Their Job Amid Chaos of Stock Tumble
Katherine Burton, Hema Parmar, and Katia Porzecanski – Bloomberg
After years trailing markets, some funds profit on global rout; ‘This is an incredible time to start picking good valuations’
At long last, beleaguered hedge fund managers may be having their moment. After a decade of mostly mediocre returns — at least compared with the red-hot stock market — hedge funds this month appear to have survived the worst drubbing for equities since the financial crisis. Some even made money.
Morgan Stanley Picks China, Singapore Stocks as Virus Shelters
Abhishek Vishnoi – Bloomberg
Broker bets on further policy stimulus and cheaper valuation; Morgan Stanley downgrades South Korea, Greece, Russia stocks
The coronavirus-wrecked equity markets of China, Singapore and Australia can now provide shelter from the outbreak, according to Morgan Stanley.
French Urged to Stop Cheek-to-Cheek Kisses to Contain the Virus
Rudy Ruitenberg – Bloomberg
One of France’s dearest touchy-feely customs is running up against the coronavirus. Health Minister Olivier Veran urged his compatriots to avoid greeting each other with a cheek-to-cheek embrace and a kiss or several — known as “la bise” in French — to avoid spreading the infection. He also renewed his official advice for people not to shake hands when they meet.
Virus fears close down France’s famed Louvre Museum
John Leicester – AP
The spreading coronavirus epidemic shut down France’s Louvre Museum on Sunday, with workers who guard its famous trove of artworks fearful of being contaminated by the museum’s flow of tourists from around the world.
Coronavirus Could Be The End Of China As Global Manufacturing Hub
Kenneth Rapoza – Forbes
The new coronavirus Covid-19 will end up being the final curtain on China’s nearly 30 year role as the world’s leading manufacturer.
Iran Battles Coronavirus—and the Black Market for Medical Supplies; As Iran struggles to contain the virus, security forces are targeting people hoarding masks for sale on the black market
Aresu Eqbali and Sune Engel Rasmussen – WSJ
Iranian authorities have seized millions of medical supplies being hoarded by black-market traders, an effort to alleviate their own shortfall as they battle to contain the world’s second-deadliest national coronavirus outbreak.
Exclusive: Norway wealth fund could blacklist four major climate culprits
Gwladys Fouche – Reuters
Norway’s $1 trillion wealth fund will exclude four companies for their vast emissions of greenhouse gases, or at least put them on probation to force them to change, the chairman of its ethics watchdog told Reuters.
U.S. Launches Tool to Stake Claim to World’s Rare Earth Minerals
Danielle Bochove – Bloomberg
State Department hopes tool to boost access for U.S. investors; Coronavirus seen raising U.S. focus on secure supply chains
In a high-tech twist on hammering pickets into the ground, the U.S. State Department has helped launch an online tool aimed at staking America’s claim to many of the world’s rare-earth minerals.
Air Pollution Vanishes Across China’s Industrial Heartland
Pete Norman – Bloomberg
Satellite images show major drop in nitrogen dioxide levels; Virus lockdown has affected factory output and transport
China’s lockdown measures to minimize further coronavirus infections have created one unexpected benefit — a dramatic improvement to the nation’s air quality.
Ousted From Oil, Saudi Minister Can Make a Mark in Investing; Khalid Al-Falih’s skills, knowledge and connections are what the kingdom needs as it seeks to become a welcome partner for foreign business.
Ellen R. Wald – Bloomberg
After a week of drama in global financial markets, it’s worth pointing out an intriguing development in Saudi Arabia that warrants watching.
Deluge of New Shares to Heap Pressure on China’s Market
More listed firms may sell new equity than boom-and-bust 2015; Regulator may have to slow pace of approvals if stocks tumble
China’s resilient financial markets may come under a new source of pressure: a flood of share sales and corporate-bond issuance as firms rush to make the most of favorable policies.
Coronavirus Hits Companies in China, But They Still Have Reason to Stay
China’s efforts to contain the coronavirus epidemic are weighing heavily on its manufacturing sector, with a second gauge plunging to a historic low as businesses endured extended factory shutdowns.
Kneeling, Korea’s Sect Leader Seeks Forgiveness for Virus Spike
Jihye Lee – Bloomberg
The ‘Immortal Prophet’ says sect cooperating with government; Shincheonji church linked to more than half of all virus cases
The leader of a religious sect that has been at the epicenter of a sudden surge in South Korea’s coronavirus infections knelt and then bowed before a throng of TV cameras and reporters before asking for forgiveness for unintentionally spreading the virus.
Iran Coronavirus Cases Almost Double as WHO Readies Larger Team
Farah Elbahrawy – Bloomberg
Iran continued to report higher coronavirus cases and deaths as the World Health Organization prepared to send a larger team to the country. Emirates Group, which runs the world’s biggest airline by international traffic, is encouraging staff to take leave as the outbreak saps demand for travel.
The political, ideological and commercial logic of Brexit
Tony Barber – Financial Times
The British government’s threat to walk away from Brexit trade talks with the EU, if the two sides make little progress by June, rests on a mixture of domestic political calculations, ideological itches and commercial reasoning. In terms of domestic politics, Prime Minister Boris Johnson and his ruling Conservatives want to consolidate the popular support they amassed in the December 12 general election, chiefly at the expense of the opposition Labour party.
Brexit: France says idea of Australia-style deal is ‘for the birds’
Lisa O’Carroll – The Guardian
France has mocked Boris Johnson’s claim that the UK can have an Australia-style deal with the EU after Brexit as “for the birds”, warning an extra six months may be needed to strike an ambitious trade deal. Its European affairs minister told an audience in London that such a deal did not exist and it was time for both sides to realise the next phase of Brexit was “for people … not for politicians”.
Brexit Was Tough. The Next 10 Months Look No Easier
Jonathan Stearns – Bloomberg
Think four years of political noise over Brexit will subside now that the European Union and Britain are set at last to kick-off negotiations on their future trade relationship? Think again. Politics will be at the forefront of the EU-U.K. talks due to begin on Monday in Brussels. As a result, businesses must take seriously the risk of tariffs and quotas on two-way trade reemerging as of January 2021, when the post-Brexit transition that maintains the economic status quo is due to end.
Brexit solved with the sword of Damocles; The UK is being belligerent, the EU inflexible. But a deal can be done this year
Gideon Rachman – FT
The prelude to the trade negotiations between Britain and the EU has felt like the weigh-in for a heavyweight title fight. As they prepared for Brexit Two, the rematch, the two boxers shouted threats at each other. Boris Johnson, the Blonde Bomber — fresh from a knockout victory in the UK election — swore that he would come out swinging. Britain, he said, was ready to break off talks, rather than take a step backwards and compromise. Boris’s corner seemed confident that Michel Barnier — the Bruiser from Brussels (still undefeated, after two years of brutal negotiations) — was now ripe for the taking.
What Coronavirus Means for Theme Parks, Concert Venues, and Outdoor Activities
Connor Smith – Barron’s
The coronavirus outbreak is causing problems for a number of companies that pack folks in large crowds. It’s a challenge for businesses ranging from theme parks to concerts and ski areas.