War for Madrid Exchange to Widen as Deutsche Boerse Considers Bid

Nov 19, 2019

First Read

Hits & Takes
By JLN Staff

Donnie Roberts is one of my favorite people and he is the next participant in the MarketsWiki Education Open Outcry Traders History Project. He came to Chicago after graduate school with a Marine Corps duffle and a cardboard box for his belongings. He met Mike Juneman at Timber Hill who introduced him to David Downey, who hired him. He traded on the Cboe and loved every day of it. But he also figured out the future did not involve pit trading and shuffling paper around. He joined Interactive Brokers, then later Thinkorswim. Today he is the president and CEO of the startup The Small Exchange.~JJL

Michael Hermann is starting a new position as a sales executive at ICE Data Services at Intercontinental Exchange.~JJL

Hot off the presses is the announcement from American Financial Exchange, LLC (AFX) that they have launched AMERIBOR on the blockchain. AFX now mints two ERC-721 non-fungible tokens for each AMERIBOR transaction on the AFX platform (for each counterparty to the transaction). Nothing available online as of press time.~SR

Those who are travelling to, or work and live in Hong Kong shouldn’t take any chances when it comes to personal safety, as the situation there has gone from bad to worse. Global medical, safety, and security consultancy firm HX Global/Healix International has raised its current risk level for Hong Kong to “Moderate.” Stay safe out there, folks.~MR

The count on the Justice for Jitesh petition on Change.org is over 1650. Time to send the petition along and start to apply more pressure.~JJL

John Lothian News is developing a special report about spoofing. The report will include a whitepaper written around the subject from content produced at an anonymous roundtable discussion of a diverse group of industry participants. The special report will also include one-off stories and commentaries, video interviews and various related resources. We are looking for participants and sponsors for the special report. Contact me if you are interested in participating and/or sponsoring the special report.~JJL


Global Appeal: Tim McCourt of the CME Group

ESGs, S&P E-Minis, and Bitcoin Options – oh my! Tim McCourt stopped by the Eurex booth at FIA Expo 2019 to discuss how consumer demand has shaped the CME’s latest product offerings.

Watch the video »


The Purpose of a Corporation Should be Driven by “And” Not “Or”
Adena Friedman – President and CEO of Nasdaq
Earlier this year, I joined 180 other CEOs to sign the Business Roundtable’s “Statement on the Purpose of a Corporation.” The letter underscored our commitment to the free market system while also laying out a set of responsibilities that we believe each company owes to all stakeholders – to deliver value, to invest in employees, to be ethical with our suppliers, to support our communities, and to focus on long-term shareholder value.

*****Do well by doing good. Simple.~JJL


Dealing With Bias in Artificial Intelligence; Three women with extensive experience in A.I. spoke on the topic and how to confront it.
Craig S. Smith – NY Times
Bias is an unavoidable feature of life, the result of the necessarily limited view of the world that any single person or group can achieve. But social bias can be reflected and amplified by artificial intelligence in dangerous ways, whether it be in deciding who gets a bank loan or who gets surveilled.

*****For years the definition of artificial intelligence was someone drinking beer.~JJL


New study finds journalists score far lower in moral reasoning than they did 13 years ago
Eric W. Dolan – PsyPost
A new study published in Journalism Practice suggests that professional journalists are less morally developed than they used to be. “For the last couple years, one of my main research interests has been the shifting nature of journalistic identity, like what makes up professionalism in the industry. Numerous studies by various researchers have shown that it’s kind of in flux,” said study author Patrick Ferrucci, an assistant professor at University of Colorado-Boulder.

*****The “NONES” have it.~JJL


Pot Stock Hits Keep Coming as Biden Knocks Weed Ahead of Meeting
Aoyon Ashraf – Bloomberg
Marijuana stocks took another leg down on Monday, after the Washington Post reported that former vice president Joe Biden said that weed may be a “gateway drug” that can lead users to harsher substances, a sign one of the leading democratic challengers to President Trump may be at odds with much of his party when it comes to pot. Pot stocks including Canopy Growth Corp., Aurora Cannabis Inc., Cronos Group Inc. and ETFMG Alternative Harvest ETF underperformed Monday, extending a recent slump that has plagued the sector following a brutal earnings season.

*****Weeds always come back.~JJL


Monday’s Top Three
Our top read story of the day was Richard Johnson’s The Hard Step column in Medium about starting a new company. Second was Gary DeWaal’s always insightful and carefully un-named analysis in Bridging The Week’s Cryptocurrency or Security; Spoofing; Double Jeopardy; Restitution. Third was the FT’s Ion Group buys currency software supplier MarketFactory


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Lead Stories

War for Madrid Exchange to Widen as Deutsche Boerse Considers Bid
Viren Vaghela and Daniel Schaefer – Bloomberg
Operator of Frankfurt exchange has $2.2 billion war chest; Swiss exchange made a $3.1 billion offer; Euronext is in talks
The battle for the Madrid stock exchange could escalate into a three-way bidding war as Deutsche Boerse AG looks into whether it should enter the fray. The operator of the Frankfurt bourse is studying a potential offer for Bolsas y Mercados Espanoles SA, according to a person familiar with the matter. The process is at an early stage and Deutsche Boerse may still decide against such a move, said the person, asking not to be identified discussing internal deliberations.

Asset manager Russell Investments put up for sale; Goldman Sachs hired to sell group with $293bn under management as industry consolidates
Eric Platt and James Fontanella-Khan and Owen Walker – FT
Private equity owner TA Associates has hired Goldman Sachs to explore a sale of Russell Investments, putting the $293bn asset manager on the block as part of a wave of consolidation in the fund management industry, according to people briefed on the matter.

MGEX Launches SPIKES Futures in Collaboration with MIAX and T3 Index
Miami International Securities Exchange, LLC (MIAX) and the Minneapolis Grain Exchange, Inc. (MGEX), a Designated Contract Market (DCM) and Derivatives Clearing Organization (DCO), today reported the launch of futures on the SPIKES Volatility Index (SPIKES).

How Riyadh’s Saudi Aramco ambitions were thwarted; Bankers had to deliver news to angry chairman that investors valued oil group at well below $2tn target
Simeon Kerr and Arash Massoudi and Anjli Raval – FT
Some of the world’s top investment bankers gathered at a Riyadh palace on Saturday to deliver their final recommendations on a project that had consumed the government of Saudi Arabia for the past few years: the initial public offering of Saudi Aramco.

Most German banks are imposing negative rates on corporate clients; Practice proves controversial in country where ECB has been accused of penalising savers
Martin Arnold and Olaf Storbeck – FT
Almost 60 per cent of German banks are charging negative interest rates on the deposits of corporate clients and more than 20 per cent are doing the same for retail customers, according to new data published on Monday.

Return of short-selling bans: market protection or ‘war against truth’?
Lawrence Delevingne, Simon Jessop, Jonathan Spicer – Reuters
New moves to curb short-selling in some countries have set the stage for a renewed battle between free market advocates and authorities aiming to check investors they see as profiteers who destabilize major companies.

Fannie’s and Freddie’s Long Road to Public Offerings; Regulators have offered a timeline for the government-backed entities’ release from government control, but some key decisions remain
Telis Demos – WSJ
There are now some timelines in the way forward to reshape the U.S. housing-finance system. A lot still needs to happen, though.

Exchanges, OTC and Clearing

Deutsche Börse, Swisscom and Partner successfully transact securities transactions with tokens in Switzerland; Feasibility study lays the foundation for efficiency leap in securities settlement / settlement using different DLT protocols
Deutsche Börse
Deutsche Börse, Swisscom and its three partners Falcon Private Bank, Vontobel and Zürcher Kantonalbank have successfully completed securities transactions with tokenized shares using Distributed Ledger Technology (DLT). With this proof-of-concept, the partners demonstrate through legally binding transactions what immediate and secure securities settlement of small and medium-sized enterprise (SME) securities could look like in the future.

ABN AMRO Bank selects UnaVista as its regulatory reporting platform for SFTR and MiFID II
London Stock Exchange Group
UnaVista, part of London Stock Exchange Group, is delighted to announce that it has been selected by ABN AMRO Bank as their regulatory reporting platform for SFTR trade reporting and MiFID II transaction reporting.

MTS launches first electronic trading platform for Cypriot government bonds
London Stock Exchange Group
MTS, part of London Stock Exchange Group, today announces that it has launched the first designated electronic trading platform for Euro-denominated Cypriot government bonds.

BME’S Pre- Market Environment To Hold Its 6th Investor’s Day Tomorrow
The BME Pre Market Environment (EpM) will tomorrow hold its 6th Investor’s Day in Valencia tomorrow, in which it will bring together all the companies that make up this training and networking programme. This year the EpM brings news, as the Steering and Monitoring Committee has agreed to incorporate Forner SomHi and two new partners: BerriUp and Ética

Bursa Malaysia Launches Mirror, Learn & Trade
Bursa Malaysia Berhad (“Bursa Malaysia” or “the Exchange”) today launched Mirror, Learn & Trade (MLT), a first-of-its-kind virtual education programme in Malaysia in collaboration with some of the country’s leading analysts. It aims to provide a platform for both potential and current investors to learn and build their investment knowledge and strategies to invest in the stock market.

Moscow Exchange signs memorandum of understanding with China Foreign Exchange Trade System
Moscow Exchange (MOEX) has signed a Memorandum of Understanding (MoU) with the China Foreign Exchange Trade System (CFETS) to facilitate collaboration and to unify the liquidity pools for trading in the RMB/RUB currency pair on the two platforms.

Japan’s Tokai invests $5 mln in SGX, Temasek backed blockchain firm iSTOX
Ledger Insights
Today, blockchain capital markets platform iSTOX said it received $5 million in funding from the Singapore unit of Japan-based Tokai Tokyo Financial Holdings. Developed and managed by blockchain firm ICHX Tech, the platform aims to provide one-stop issuance, custody and trading of digitized securities.

Amendment of Default Transaction Size Limits
In the context of the launch of T7 Release 8.0 and due to Member feedback referring to the new release, Eurex Frankfurt AG revised the default transaction size limits defined by the exchange.

MIAX Exchange Group – Holiday Schedule – Thanksgiving 2019
Please be advised that the MIAX Exchanges will be closed on Thursday, November 28, 2019 in observance of the Thanksgiving Holiday.


Luminex Adds To Sales and Technology Teams In Response To Growing Engagement With Its Block Trading Venue
Globe Newswire (press release)
Luminex Trading & Analytics LLC, a buy side-owned trading venue delivering efficient, low-cost block executions, today announced the hires of three veteran financial and technology professionals, spurred by growing engagement with the platform by its community of investment management firms. Joshua Reed has joined as a Sales and Relationship Manager, Joshua Opper has joined as Director of Infrastructure and Robin Burr has joined as a Software Engineer.

Zurich’s Bankers Make Way for Techies and Bitcoin Startups; The capital of Swiss banking draws big names like Google and Facebook, as well as a swarm of crypto companies.
Catherine Bosley – Bloomberg
On Bahnhofstrasse, Zurich’s main street, a building that once housed a private bank has been turned into a hub for blockchain development. The forces reshaping the economy of Switzerland’s largest metropolis are also exerting a sartorial influence. Fifteen years ago, “I think 80 percent of the men would’ve been wearing a suit and tie. Now it looks different,” with more people dressed casually, says Thomas Meister, general manager of Trust Square, which has 40-odd companies working on crypto applications as tenants.

INDATA launches architect AI data analytics; Buy-side software specialist INDATA unveils cloud- and web-based data aggregation tool aimed at helping investment firms get to grips with their data.
Hayley McDowell – The Trade
Buy-side software and technology provider INDATA has released software-as-a-service (SaaS) to help investment firms aggregate data for business intelligence (BI) reporting.

ABN AMRO adopts UnaVista regulatory reporting platform; ABN AMRO Bank will use UnaVista’s platform for MiFID II and SFTR regulatory reporting.
Hayley McDowell – The Trade
ABN AMRO Bank has opted to adopt a regulatory reporting platform from the London Stock Exchange Group’s UnaVista for MiFID II and securities financing transactions regulation (SFTR) compliance.

Losing the Plot with Doug Cifu, CEO of Virtu Financial
Doug Cifu chats with Ronan and JR about 606 reporting, the future of analytics at Virtu, and how his past as a fashion lawyer (!) informs his work.

Connections count when it comes to start-ups; Successful university incubators forge links across disciplines
Jonathan Moules – FT
Erik Abrahamsson grew up in rural southern Sweden and worked for tech start-ups in Singapore before returning to full-time study on an MBA programme. He does not think he could have found a better location than Oxford, where he completed his masters degree, to launch his own venture, a data analytics business for the insurance sector called Digital Fineprint. “To start a successful company you need to be close to knowledgeable people and Oxford has some of the greatest talent in the world,” Mr Abrahamsson says.

OANDA names Lucian Lauerman Head of Solutions for Business
A global leader in online multi-asset trading services and currency data and analytics, OANDA Global Corporation is pleased to announce the appointment of Lucian Lauerman as Head of Solutions for Business. Based in London, he will be responsible for the strategic growth of the firm’s corporate offering, which delivers cutting-edge foreign exchange technologies and services to leading companies around the world.

Ant May Join Race for Singapore Virtual Bank Licenses
Chanyaporn Chanjaroen and Lulu Yilun Chen – Bloomberg
Jack Ma’s firm is ‘actively looking into this opportunity’; Online finance giant got a permit in Hong Kong this year
Billionaire Jack Ma’s Ant Financial Services Group said it may apply for a virtual banking license in Singapore, a move that would add a heavyweight contender to the race.


Andrew Yang Campaign Releases Technology Plan Focusing on Rebuilding Public Relationship With Big Tech
Danny Nelson – Coindesk
Crypto-friendly U.S. presidential candidate Andrew Yang unveiled his campaign’s technology plan focused on how to rebuild America’s relationship to its big tech behemoths, in addition to his calls for normalizing how crypto is treated at the regulatory level. In a policy proposal posted to his website, Yang proposes stringent data protection laws, a “Department of Technology,” child-protection health guidelines and changes to section 230 of the Communications Decency Act, the central tenet of internet regulation that shields websites from their users’ actions. Details of his crypto plan come near the end of the 3,500-word tech manifesto.

To save the euro, turn it into a digital stablecoin; A bond-backed currency would overcome problems created by incomplete monetary union
Thomas Mayer – FT
When economic weakness turns into recession, Leo Tolstoy’s observation that “every unhappy family is unhappy in its own way” will apply to the eurozone countries. Increasing economic divergence will put strains on the eurozone that could lead to its collapse. The European Monetary Union project has failed to reach completion. While the banknotes issued by the European Central Bank are of uniform credit quality, the value of euros deposited in banks differs across countries depending on the financial firepower of national governments to back the deposits when banks fail.

Is bitcoin really an “uncorrelated safe haven”?
Jemima Kelly – FT
Over the years bitcoin has frequently been touted as a “safe haven”. It’s an idea that seemingly doesn’t to want to die, despite the fact that its pretty much the most volatile things you can get your hands on and there’s been a stream of thefts and hacks worth hundreds of millions of dollars from exchanges and other crypto platforms.

Stablecoins as a euphemism for full-reserve banking
Izabella Kaminska – FT
Everyone has a personal theory of money. And by and large everyone’s theory differs to everyone else’s. Because money is in part philosophical as well as technical, and hence hugely subjective.

Winklevoss Brothers Buy a Startup Founded by Identical Twins
Olga Kharif – Bloomberg
Gemini’s first acquisition lets users buy crypto collectibles; Nifty Gateway lets people buy digital assets with credit card
Crypto entrepreneurs Tyler and Cameron Winklevoss just made their first-ever acquisition, and the duo behind the company they bought couldn’t be more similar.

Galaxy Digital Launches Bitcoin Funds
PR Newswire
Galaxy Digital Holdings Ltd. (TSXV: GLXY) announced that its affiliate, Galaxy Digital Capital Management LP, launched the Galaxy Bitcoin Fund and the Galaxy Institutional Bitcoin Fund. Both funds are passively managed vehicles that offer institutional and accredited investors low-fee, institutionally wrapped bitcoin exposure supported by vetted service providers.

The SEC Is Reviewing the Bitwise Bitcoin ETF Rejection
Nikhilesh De – Coindesk
The U.S. Securities and Exchange Commission (SEC) is taking a second look at the rejection of a recent bitcoin exchange-traded fund (ETF) proposal. Overturning the rejection would clear the way for potentially the first bitcoin ETF in the U.S., following years of anticipation of a mainstream-ready investment product. According to a notice published in the Federal Register over the weekend and dated Nov. 18, the SEC’s five commissioners will review the bitcoin ETF put forth by Bitwise Asset Management. Bitwise did not request the review, said Matt Hougan, the company’s global head of research.

UK Law Panel Defines Crypto Assets as Property
Daniel Palmer – Coindesk
A panel of senior British judges and lawyers has moved to clarify the status of cryptocurrencies in law. The UK Jurisdiction Taskforce of the Lawtech Delivery Panel published a legal statement Monday, recognizing crypto assets as “tradable property” under English and Welsh law. The statement also defines smart contracts as “enforceable agreements” under English law.

IRS investigators scrutinize Bitcoin ATMs and kiosks
Yilun Cheng – The Block Crypto
The Internal Revenue Service (IRS) is actively policing crypto ATMs for potential money laundering and tax issues, a top official told Bloomberg last Friday. To date, there are 4,131 Bitcoin ATMs and kiosks in the United States, according to Coin ATM Radar. With these machines, users can pay a small fee and trade fiat currency for cryptocurrency on the spot. While a convenient invention, these services have raised concerns among regulators.

No, Royal Bank of Canada Isn’t Opening a Crypto Exchange
Nikhilesh De – Coindesk
The Royal Bank of Canada (RBC) is not currently planning to build or launch a cryptocurrency exchange, CoinDesk has confirmed. RBC spokesperson Ed Jones pushed back on recent media reports that Canada’s largest bank was exploring the development of a crypto exchange, telling CoinDesk via email on Monday that a number of recent patent applications filed by the bank do not indicate any intention to actually launch an exchange. Canadian news source The Logic reported last week that the bank was “exploring” the launch of a crypto trading platform. A number of other news sites picked up the story or republished The Logic’s version.

China Crypto Crackdown Elicits Binance, Tron Weibo Appeal
Zheping Huang – Bloomberg
Shanghai regulators ordered crypto-related firms to quit; Suspensions come after Xi Jinping’s remarks triggered frenzy
Crypto giants Binance Holdings Ltd. and Tron have been banned on China’s largest micro-blogging service amid what appears to be fresh steps to crack down on digital currency trading.


With Friends Like These, Do Markets Need Enemies? Elizabeth Warren, Jeremy Corbyn and Germany’s Greens may be their ironic savior.
John Authers – Bloomberg
One trend common across the world seems to be that the markets’ best chances of getting what they want comes from parties and politicians normally regarded as market-unfriendly. In the U.K., the Conservatives, usually the markets’ friend, are also the party of Brexit. In the U.S. the strongest opposition to the erratic Donald Trump is coming from populist left-wingers. And in Germany, under pressure to reverse course and adopt an expansive fiscal policy, the best chance of that involves getting the Greens in power.

Christine Lagarde Can Face Down the ECB Skeptics; She inherited a governing council riven by political differences. But there’s more the European Central Bank can do to boost growth if it wants to.
Ferdinando Giugliano – Bloomberg
Christine Lagarde has taken the helm of the European Central Bank at a time of rising skepticism over the power of monetary policy. Critics say that the central bank has no tools left to bring inflation back to its target of close to, but below, 2%. The ECB is now a helpless bystander, they claim, as the power to foster a recovery sits squarely with elected governments.

Trade War Drag on World Economy to Fade in 2020, Says Goldman
Bloomberg News
The trade war’s drag on the world’s largest two economies will gradually fade in 2020 as tariffs on imports from China have likely peaked, according to Goldman Sachs Group Inc.

Trump says he told Fed’s Powell U.S. interest rates are too high
U.S. President Donald Trump said he complained to Federal Reserve Chair Jerome Powell about high U.S. interest rates in a meeting they held at the White House on Monday morning.

Trump Is Scaring Away Some Foreign Students; New data shows a continuing but modest decline in the flow of international students to U.S. colleges and universities.
Justin Fox – Bloomberg
The number of new international students at U.S. universities fell for the fourth academic year in a row in 2018-2019. But only by a little bit (the new-student number was 0.9% lower than the previous year’s).

A Massive Coal Plant That Asked for Trump’s Help Has Gone Dark
Will Wade – Bloomberg
Navajo Generating Station powered Arizona’s growing population; Gas, renewable energy proved too cheap for plant to compete
In the end, the unraveling economics of U.S. coal proved too much for even a giant among power generators to handle.

Warren Calls Out Blackstone for ‘Shameless’ Profits From Housing
Misyrlena Egkolfopoulou and Heather Perlberg – Bloomberg
Democrat says firm ‘tanked’ homeownership for many after 2008; Criticism comes in release of her $500 billion housing plan
Elizabeth Warren called out Blackstone Group Inc. for its real estate practices as she laid out her tenants’ rights plan, accusing the company of “shamelessly” profiting from the 2008 housing crisis.

Donald Trump Promised to Eliminate the Deficit in 8 Years. So Far, he has increased it by 68%
Shane Croucher- Newsweek
During the 2016 campaign, President Donald Trump made an aggressive promise on federal finances: He would eliminate the budget deficit within eight years. Now, three years into his presidency, the deficit is 68 percent higher than when he started.


ESMA chair outlines staggered and focused approach to MiFID II review; ESMA chair Steven Maijoor acknowledged a recent position paper from the German regulator calling for reform to MiFID II in Europe during a keynote address.
Hayley McDowell – The Trade
European authorities will take a “staggered” and “focused” approach to an upcoming review of MiFID II which could see changes to the wide-reaching rules, according to the chair of the EU financial watchdog.

Steven Maijoor delivers keynote address at Euro Finance Week
The Chair of the European Securities and Markets Authority (ESMA), Steven Maijoor, has delivered the keynote address at the beginning of the Governance Risk Management and Compliance Day of Euro Finance Week in Frankfurt.

Conduct risk during LIBOR transition: Questions and answers
LIBOR will end after 2021. We expect firms to take appropriate steps to ensure they can transition to alternative rates ahead of end-2021.

FCA to monitor whether firms take steps to treat customers fairly when replacing LIBOR
Finance Feeds
In choosing replacement reference rates, considering the contract as a whole, firms need to ensure the replacement rate is fair, the UK regulator says.

SEC revisits security-based swaps proposal; Sefs expect new trading rules for single-name CDS to be published “pretty soon”
Robert Mackenzie Smith – Risk.net
The US Securities and Exchange Commission is reworking its 2011 proposal on security-based swaps. New trading rules could be out for comment in the coming months, say industry sources.

SIFMA’s Board Of Directors Announces Newly Elected Officers
The Board of Directors of SIFMA announced it has elected the following principal officers to leadership positions on the Board for 2020:

FCA publishes damning report on gender diversity
Rachel Mortimer – FT Adviser
Little progress has been made towards achieving gender diversity in the financial services industry, a damning report has found. A research note carried out for the Financial Conduct Authority and published by the regulator yesterday (November 18) warned diversity had remained “consistently low” at industry level at a female quota of approximately 17 per cent of FCA approved individuals.

SEC Chairman Cites Fishy Letters in Support of Policy Change
Zachary Mider and Ben Elgin – Bloomberg
Advocacy group ginned up comments on shareholder voting; Clayton cited some of the letters at a commission meeting. When Securities and Exchange Commission Chairman Jay Clayton handed a policy win to corporate executives this month, he pointed to a surprising source of support: a mailbag full of encouragement from ordinary Americans.

Professor Who Wrote Book on Drug Crime Is Accused of Money Laundering
Bob Van Voris – Bloomberg
Bagley charged in U.S. with laundering cash from Venezuela; Professor edited book on drug trafficking and organized crime
A Miami professor who’s an expert on drug trafficking and organized crime was charged by the U.S. with laundering money from Venezuela, skimming more than $250,000 for himself.

Ex-Hedge Fund Trader Gets 40 Months for Mismarking Scheme
Chris Dolmetsch – Bloomberg
Jeremy Shor convicted in scheme to overvalue fund assets; Shor’s prosecution was part of broader federal crackdown
A former trader at the defunct hedge fund Premium Point Investments was ordered to spend almost 3 1/2 years in prison for conspiring with the firm’s co-founder to overvalue its assets in order to attract new investors and keep clients from leaving.

Carl Icahn urges U.S. SEC to ‘rethink’ proposed rule change for proxy advisers
Billionaire activist investor Carl Icahn on Monday urged the U.S. Securities Exchange Commission (SEC) to rethink a proposed rule change for proxy adviser firms, saying it would make activist investing “even more difficult and expensive to practice.”

Husband And Wife From W. New York Admit Running $500K Ponzi Scheme
Paul Milo- Daily Voice
A married couple from West New York pleaded guilty to multiple offenses related to an investment firm that was really cover for a Ponzi scheme, the U.S. Attorney for New Jersey said Monday.

Brooklyn man sentenced in landmark cryptocurrency fraud case
Aaron Elstein – Crain’s New York
A Brooklyn cryptocurrency promoter was sentenced to 18 months in prison Monday, becoming the first person to serve time for running an ICO scam.

Investing and Trading

Analyst Hub Opens San Francisco Office with Veteran Equity Research Executive Warren Dowd as Head of West Coast Sales
Globe Newswire
Analyst Hub, LLC, an independent research infrastructure platform company that provides talented sell-side analysts a path to owning their own enterprises, today announced the addition of veteran equity research sales executive Warren Dowd as Head of West Coast Sales in Analyst Hub’s new San Francisco office.

Let Proxy Advisers Do Their Work; Muzzling independent research firms would only reward underperforming CEOs and stifle oversight.
Carl Icahn – WSJ
Over decades, my companies created hundreds of billions of dollars of value for shareholders by guiding boards and chief executives through the steps necessary to increase the value of their companies. Holding boards and CEOs accountable—and replacing them when necessary—improves the economy, makes companies more competitive, increases employment, and adds to shareholder value. Disasters like Enron, WorldCom and Tyco are much less likely when investors can subject CEOs and boards to scrutiny.

The absence of fear is a little scary in itself; Wall Street’s Vix volatility gauge is becalmed, as stocks keep drifting higher
Philip Stafford – FT
The S&P 500 closed at a record high last Friday, just like it did in the six weeks before that. Despite a lot of political turmoil around the world, prices are drifting gently upwards, and a lot of people expect them to keep doing so.

Why the global shortage of safe assets is getting worse; Limited supply of government bonds could keep yields low or negative
Tommy Stubbington – FT
Government bonds issued by big developed economies have surged in price this year — pushing yields to record lows. A key reason is that these “safe assets” are in short supply.

HSBC Says British Pound May Soar. Or Crash
Tracy Alloway and Chris Anstey – Bloomberg
Nothing is priced in, says Bloom at the country’s biggest bank; Sees sterling at $1.45 end of 2020 on Brexit deal, $1.10 no de
The outcome of Britain’s December election poses a binary choice for the nation’s currency and “anything can happen” at the polling stations, according to the largest U.K. bank.


Julius Baer CEO Rewards Investors With First Buyback in 8 Years
Patrick Winters – Bloomberg
Swiss bank to book writedown for struggling Italian unit; Net new money drops further below Baer’s medium-term targets
Julius Baer Group Ltd. announced its first share buyback in eight years as Chief Executive Officer Philipp Rickenbacher rewarded investors for sticking with the bank through two years marked by compliance concerns and sliding returns.

Ken Fisher Loses $67 Million as Chicago Police Fund Pulls
Janet Lorin – Bloomberg
Lewd comments by Fisher have spurred exodus of clients; About $3.9 billion in investor cash has been pulled from firm
Chicago’s police pension fund, responding to lewd comments made by money manager Ken Fisher, has decided to pull about $67 million it has invested with his firm.


Global Infrastructure Partners Seeks $5 Billion for Debut Emerging-Markets Fund
Gillian Tan – Bloomberg
Infrastructure manager is raising up to $22 billion main fund; GIP is also seeking $1.25 billion for its third Indian fund
Global Infrastructure Partners is seeking $5 billion for its debut emerging-markets fund, according to a person familiar with the matter.

Norwegians to Giant Wealth Fund: Can I Have My Cash Now?
Mikael Holter – Bloomberg
Fund sees uptick in inquiries from people seeking withdrawals; Investment vehicle was created from Norway’s vast oil wealth
Norway has always said its sovereign wealth fund belongs to the people. But recently, that’s needed a bit of clarification.

China’s travellers get nervous about going abroad; Domestic tourism becomes more appealing amid growing concerns about safety
Asia Research – FT
Chinese appetites to travel abroad are being tested by safety concerns as law and order break down in Hong Kong and as Beijing’s relations with governments in key holiday destinations fray.

At UN, Middle East countries discuss steps towards regional nuclear-free zone
UN News
Speaking on Monday during the inaugural session of the deliberations on a nuclear-weapon free Middle East, UN Secretary-General António Guterres said the zone would have significance beyond the region. “I therefore hope this Conference will serve as the start of an inclusive process in which all the States of the region can participate,” he said.


An inflexible Brussels is damaging its own interests over Brexit; The EU has seen legal constraints where there are in fact only political choices
Anand Menon – FT
The EU has behaved inflexibly during the Brexit negotiations. In doing so, it has ignored its own interests, which favour a close and collaborative relationship with the UK.

One Million Brexit Coins Melted Down After Johnson Misses Deadline
Thomas Penny – Bloomberg
The U.K. has used the seven-sided 50 pence coin to celebrate national achievements ranging from the London Olympics of 2012 to the work of children’s author Beatrix Potter.

Brexit or Corbyn? U.K. Business Agonizes Over Election Choice
Joe Mayes – Bloomberg
Caught between a Brexit they don’t want and a firebrand socialist they fear, business executives were not impressed after the leading candidates in Britain’s upcoming general election tried to win their support. Speeches by Conservative Prime Minister Boris Johnson and opposition Labour leader Jeremy Corbyn failed to resonate with attendees at the Confederation of British Industry’s conference in London on Monday.


Study Finds Vast Majority of Americans See Local News As A ‘Public Good’
Annabelle Woodward – Forbes
It’s been a hard decade for local newspapers in America. Though widely considered vital to democracy, daily and weekly local news outlets have been in decline since the early 2010s, around the same time that tech platforms like Facebook and Google began dominating the digital space. Algorithm-driven consumption habits, coupled with the Republican-led Federal Communication Commission’s 2017 decision to permit large-scale broadcast media mergers, have only succeeded at making matters worse.

The new “Wolf of Wall Street” is an influencer who sells gold to Republican seniors
Hanna Kozlowska & Jeremy B. Merrill – Quartz
Lucas Asher says in a YouTube video that he’s an investor in tech world darlings like Spotify and Palantir. He’s founded a few startups of his own, including a music-sharing app called Revo. He admires Silicon Valley visionary billionaires like SpaceX CEO Elon Musk.

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CME to permanently close most trading pits

CME to permanently close most trading pits

First Read $40,626/$300,000 (13.5%) Anonymous ++++ Hits & Takes John Lothian & JLN Staff Without fanfare or amplification from its executives, the CME Group shut the books on most -- but not all -- of its floor trading history Tuesday afternoon with the...

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