Breaking News

John Lothian Newsletter: Six Exchanges Collectively Fine Merrill Lynch; CBOE, Bats Deal Creates New Exchange Behemoth; Hedge Funds Take Another Punch to Gut

First Read

Kristin Boggiano, Guggenheim Partners – It’s a Jungle Out There

MarketsWikiEducation.com

“You’re going to reinvent yourself your whole career. It’s not just a one-step thing. You may start off in the Ecuadorian Amazon, and become a regulatory lawyer years later.”

When Kristin Boggiano was finishing college, she admittedly had no clue what she wanted to do. So when she got an opportunity to spend three weeks in the jungles of Ecuador working with indigenous tribes, she jumped at the chance. When she returned, she still had no conclusions, except that she really enjoyed indoor plumbing, air conditioning and American food.

What she has come to understand, however, is the value of a network, which is why she founded Women in Derivatives (WIND), which attracts, educates and mentors female leaders in the financial industry.

Boggiano also understands that the key to finding one’s place in the industry is to follow the demand. While that may mean fewer traders and brokers in today’s financial world, it also means more specialists in operations, technology, risk management, compliance, and law.

But it wouldn’t hurt to swing by Ecuador, just to check it out.

Watch the video »

++++

ICE Clear Singapore Announces J.P. Morgan As A New Clearing Member
ICE
Intercontinental Exchange (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, today announced that J.P. Morgan has been approved as a clearing member for ICE Clear Singapore, effective immediately.
/goo.gl/JycLCi

***** Big catch for ICE in Singapore.

++++

DRW employee explores intersection of technology and business in lecture
The Michigan Daily
Matt Godbolt, a senior software engineer at the financial trading firm DRW, charged that the convergence of business and software engineering has never been more prominent than it is right now at a lecture on campus Tuesday evening
Godbolt addressed a crowded electrical engineering and computer science classroom filled with primarily EECS undergraduate students, discussing his career path and the financial trading field.
jlne.ws/2dwdZwW

***** Maybe we can get Matt for next year’s Chicago MarketsWiki Education World of Opportunity program.

++++

Disney Is Working With an Adviser on Potential Twitter Bid
Alex Sherman, Sarah Frier – Bloomberg
Salesforce said to be working with Bank of America on bid; Twitter presentations to prospective buyers said to start soon
Walt Disney Co. is working with a financial adviser to evaluate a possible bid for Twitter Inc., according to people familiar with the matter.
/goo.gl/QS7Upr

***** The term “tweet” will be discontinued and the term “GOOFS” will be adopted.

++++

Monday’s Top Three
Yesterday’s top story, of course, was CBOE‘s $3.2 billion acquisition of Bats Global Markets. In the click race, however, the story did not make the top three, probably because all the facts of the deal, as well as the view of our editorial staff, appeared in their entirety in the newsletter. If you missed it, click HERE.
In the click race, the top story was a bit more lighthearted, a NY Times obituary, Edward Davis, ‘World’s Grumpiest Boss,’ Dies at 85. In second place was a regular Monday feature, Katten Muchin Rosenman Special Counsel Gary DeWaal‘s weekly feature, Bridging the Week. Rounding out the top three was a cautionary tale of being penny-wise and pound-foolish. According to a Bloomberg View feature by Barry Ritholtz, Harvard’s underperforming endowment fund is learning that sometimes you get what you pay for.

Lead Stories

Six Exchanges Collectively Fine Merrill Lynch $3 Million for Violating the SEC’s Market Access Rule and the Exchanges’ Respective Supervision Rules
By GlobeNewswire
The Bats BZX Exchange, Inc., Bats BYX Exchange, Inc., Bats EDGX Exchange, Inc., New York Stock Exchange LLC, NYSE Arca, Inc., and The NASDAQ Stock Market LLC (collectively, the “exchanges”) announced today that, in disciplinary actions initiated by the Financial Industry Regulatory Authority (“FINRA”) on their behalf, the exchanges collectively fined Merrill Lynch, Pierce, Fenner & Smith Incorporated (“Merrill Lynch” or the “firm”) $3 million for violating the Securities and Exchange Commission’s (“SEC”) market access rule and the exchanges’ respective supervision rules.
/goo.gl/TP3pZs

SEC: Merrill Lynch Charged With Trading Controls Failures That Led To Mini-Flash Crashes
SEC.gov
The Securities and Exchange Commission today announced that Merrill Lynch has agreed to pay a $12.5 million penalty for maintaining ineffective trading controls that failed to prevent erroneous orders from being sent to the markets and causing mini-flash crashes.
/goo.gl/5dGr8c

CBOE, Bats Deal Creates New Exchange Behemoth; The $3.2 billion cash-and-stock offer is the latest move in the wave of consolidation in the exchanges sector
By BRADLEY HOPE and TELIS DEMOS – WSJ
For years, CBOE Holdings Inc. was the reluctant acquisition target: a profitable options exchange with an old-school trading floor ripe for change.
/goo.gl/6lI6Bu

Hedge Funds Take Another Punch to Gut; Brevan Howard to charge 0% fees for some investors, while Perry Capital is shutting down
By JULIET CHUNG – WSJ
The hedge-fund business is getting so tough that two of its biggest names are taking radical steps. Europe’s Brevan Howard Asset Management LLP plans to charge 0% fees for some investors. New York stalwart Perry Capital LLC is going further. It is shutting down.
/goo.gl/HDaov8

Richard Perry Walks Away, Hoping He’ll Get a Shot at Vindication
Katherine Burton, Katia Porzecanski – Bloomberg
Manager says he’d back Westhus and Shah if they start funds; Perry says mortgage bet could take a year or more to play out
Richard Perry can’t quite believe it’s over. Despite three years of losses, falling assets and turnover of senior executives, despite even the news Monday that he was shuttering his flagship hedge fund — he’s still looking for a bit of redemption.
/goo.gl/WiPGmn

World Record in Negative Rates Has Surprising Lesson for Banks
Frances Schwartzkopff – Bloomberg
Danish bankers association head says NIRP good for impairments; Banks may get through whole NIRP cycle without passing on cost
The head of the bankers’ association in Denmark, where interest rates have been negative longer than anywhere else on the planet, says the policy may not be as punishing for lenders as once thought.
/goo.gl/6nb4SX

Perseus Announces World’s Fastest Route Between Chicago and Tokyo
Perseus
Perseus, a proven leading provider of global managed services and high-precision, high-speed connectivity, today announces improvements to its network route between Chicago and Tokyo. Once the project is complete, Perseus will offer the lowest latency connectivity commercially available between the two markets.
/goo.gl/HUDwuO

Banks to Need Billions More Capital in Tests Under Fed Plan
Jesse Hamilton – Bloomberg
Wall Street would have to come up with billions of dollars in additional capital in a proposed revamp of the Federal Reserve’s annual stress tests that could also scrap some provisions that lenders have criticized.
/goo.gl/4g3Vbv

A New Debate Over Pricing the Risks of Climate Change
Hiroko Tabuchi and Clifford Krauss – Bloomberg
Some companies, including Exxon Mobil, say the economics of climate change are too hard to predict for them to give investors hard numbers about the business impact of global warming.
Federal regulators may disagree and are considering requiring Exxon to do just that for the value of its oil reserves.
/goo.gl/S16XaC

Wall Street Shrinks Further in Asia With Goldman, BofA Cuts
Cathy Chan – Bloomberg
Bank of America said poised to cut senior bankers in Asia; Goldman Sachs also said to be planning steep reductions
Even a record acquisition spree by Chinese companies isn’t enough to ease pressure on investment banks to cut costs in Asia, with Goldman Sachs Group Inc. and Bank of America Corp. becoming the latest firms to prepare job reductions.
/goo.gl/xFO2uO

London Remains Ahead of New York as Top Global Financial Center
Alex Tanzi – Bloomberg
The Global Financial Centers Index measures cities based on their attractiveness to financial services professionals, according to two inputs: statistical data and a poll of finance professionals. The index was created by the Z/Yen group for the City of London.
/goo.gl/GuO4Mx

Exchanges, OTC and Clearing

CBOE/ Bats: volatile acquirer
Financial Times
The Chicago Board Options Exchange badly wants a systems upgrade. The company intends to acquire Bats, the Kansas-based operator of foreign exchange and equity markets that listed just six months ago (after botching an earlier attempt four years before). CBOE wants to move both companies’ trading activity on to the target’s technology platform. There must surely be cheaper ways to reboot.
/goo.gl/b2JMwO

China jitters and the Chicago Stock Exchange
Chicago Tribune
When it comes to stock market investments, timing is everything. So you have to feel a little bad for John Kerin, CEO of the Chicago Stock Exchange, who’s lined up an exciting deal that faces serious political head winds. He has a chance to expand in the U.S. and take his technology to China. Kerin’s vision: Make the Chicago Stock Exchange a financial services conduit for companies and investors on both sides of the Pacific.
/goo.gl/i7tAjF

Eris Sets Another Record
Eris September Newsletter
Eris Standards Open Interest set a new high of 124,116 contracts in Q3
Eris Standards OI = 73% of total
Largest single trade to date: $2.715bn
/goo.gl/eFGCsJ

Taiwan Shuts Markets as Typhoon Megi Strengthens, Cuts Power
Bloomberg
Markets and offices were closed in Taiwan on Tuesday as Typhoon Megi brought wind and rain to across the island. More than 2,000 households lost electricity and about 1,700 people were evacuated, according to the island’s National Fire Agency. The capital city of Taipei shut markets, schools and offices, along with municipalities across the island. ECB Television showed residents struggling with umbrellas blown inside out by strong wind.
/goo.gl/qaLa8v

Two Exchange Operators, CBOE and Bats, Agree to Merge
Leslie Picker – NY Times
Two Midwestern exchange operators have agreed to combine in a deal that would merge two of the largest trading venues in the United States. CBOE Holdings, which owns the Chicago Board Options Exchange, where the popular Standard & Poor’s 500-stock index and volatility index options trade, is paying $3.2 billion in cash and stock to acquire Kansas-based Bats Global Markets according to a statement released by the companies on Monday. The Chicago Board Options Exchange is the largest American options exchange, and Bats is the second-largest stock exchange operator in the United States by volume, behind the New York Stock Exchange.
/goo.gl/AV00q0

Exchanges defeat appeal of U.S. high-frequency trading lawsuits
Jonathan Stempel – Reuters
A federal appeals court on Friday rejected an investor’s attempt to revive lawsuits accusing major U.S. exchanges of selling early access to market data to high-frequency traders, the subject of Michael Lewis’ 2014 best-seller “Flash Boys.”
/goo.gl/wwXEfq

Bilateral margining driving new member activity at ForexClear
LCH
10 entities have increased or commenced activity in the last 6 months; ForexClear now has 24 members of the service; Over $100bn in notional cleared last week, the largest week since service’s inception in 2012
LCH, a leading global clearing house, announced today that its ForexClear service has seen 10 entities turn to actively clearing FX non-deliverable forwards in the past six months. A leading NDF clearing service in the market, ForexClear has experienced a significant rise in cleared notional and trade count in 2016, with over $220 billion in notional cleared to date in September 2016. As of 23 September, over $1 trillion in notional has been cleared in 2016.
/goo.gl/bJa4GY

Curveglobal – Open Access Derivatives Venture Goes Live
London Stock Exchange Group
CurveGlobal, the new interest rate derivatives venture developed by London Stock Exchange Group (LSEG) with a number of major dealer banks: Bank of America Merrill Lynch, Barclays, BNP Paribas, Citi, Goldman Sachs, J.P. Morgan and Societe Generale, together with the Chicago Board Options Exchange, has gone live.
/goo.gl/Pwo3dk

New HKEX Group Website Launches
HKEX
Hong Kong Exchanges and Clearing Limited (HKEX) released a revamped version of its Group website on the weekend featuring a suite of new features designed to improve functionality and make information easier to find.
/goo.gl/aCmjdy

Change of Company Website for Publication of Regulatory Filings
HKEX
Hong Kong Exchanges and Clearing Limited (“HKEX”) announces that it has adopted the HKEX Group website (www.hkexgroup.com) as its designated company website for publication of HKEX’s announcements, notices and other corporate communications with immediate effect.
/goo.gl/Cchc7e

New E-Learning module with degree “Certified ETF specialist”; Capital Markets Academy of Deutsche Börse provides future online tutorial
Deutsche Boerse
The German stock market has the training to become a certified ETF specialists from now as an online course. By learning format the Capital Markets Academy of the company allows participants timeshifting learning and increase flexibility. The online training has a circumference of 14 lessons and ends with a presence check in Frankfurt. So far, the offer included only a two day classroom course.
/goo.gl/IzJKzW

Interview with Philipp Schultze, Sales Equity & Index Derivatives at Eurex
Eurex
What is the rational behind the introduction of SMI® Weekly Options?
/goo.gl/XKS8E9

Italian Referendum Date Clarity Adds To Favourable Long VSTOXX, Short VIX RV Play
Eurex
by Georgia Reynolds, EMEA Reporter
Greater clarity on the Italian referendum date has created a tactical opportunity to trade VIX / VSTOXX relative value, specifically by going long VSTOXX puts and short VIX puts in October maturities. The VSTOXX Oct futures will unlikely be directly impacted, while the VIX Oct futures will likely be supported given U.S. elections according to Bank of America Merrill Lynch.
/goo.gl/FwjiWc

Thomson Reuters and Clifford Chance Team Up to Deliver OTC Derivatives Documentation Solutions
Thomson Reuters
Thomson Reuters and Clifford Chance have joined forces to help global financial institutions tackle in a timely, efficient and more cost-effective manner their most pressing regulatory obligations relating to margin rules for uncleared over-the-counter (OTC) derivatives. Using an innovative approach to contract negotiation and documentation, the partnership offers a flexible, rapidly scalable, technology-enabled solution that will empower these financial institutions to meet their current multi-jurisdictional regulatory obligations and as they continue to evolve in the future.

Politics

Mexican Peso Gives Clearest Market Signal That Trump Lost Debate
Isabella Cota, Netty Idayu Ismail – Bloomberg
Peso surges 1.8%, set for best one-day gain since February; Implied volatility climbed to 2011 high in lead-up to debate
The Mexican peso rebounded from a record low, a sign investors may perceive Hillary Clinton outperformed Donald Trump in the first U.S. presidential debate.
/goo.gl/Y61eb9

How Trump Rides on Waves of Other People’s Money
By Timothy L. O’Brien
During a campaign stop in North Carolina last week, Donald Trump described the logic behind his plans for billing other countries for U.S. military support should he become president:
/goo.gl/XhgZrY

Economics Has a Major Blind Spot
Noah Smith – Bloomberg View
The longer I work in the news media, the more I notice a problem with the way economics interacts with the world at large. Just to cite one example, economists often don’t take politics into account. As a result, econ models leave out important pieces, and the advice of economists often falls on deaf ears or is seen as impractical. Traditionally, economists think of themselves as policy advisers. Politicians and their appointees make the laws, levy the taxes, set the regulations, make spending decisions, and chart the course of monetary policy; economists stand at their side, faithful technocratic advice-givers neutrally relaying the latest insights from academia. That’s the typical vision, anyway.
/goo.gl/vMpQlp

Billionaire Banker Backs New Big-Money Group Aiding Trump
Zachary Mider – Bloomberg
Andy Beal, a billionaire banker and friend of Donald Trump, is behind a new effort to help the Republican presidential candidate defeat Democrat Hillary Clinton. Save America From Its Government, a super-political action committee, was formed earlier this month and spent about $1 million on advertisements last week, Federal Election Commission records show. According to Save America’s website, Beal helped set up the group and is paying an undisclosed amount of administrative and overhead expenses. It’s also soliciting outside donations.
/goo.gl/s2SYNp

Hillary Clinton Is Outraising Trump 20-to-1 Among Billionaires
Bloomberg
Hillary gets the vote from America’s richest citizens. Or at least she’s getting their cash. Former Secretary of State and Democratic presidential candidate Hillary Clinton has collected $21.1 million for her campaign and its supporting political action committees from 17 U.S. donors on the Bloomberg Billionaires Index. Republican Donald Trump has received $1.02 million from 12 members of the group.
/goo.gl/UvWXEG

Deutsche Bank Returns to Haunt Merkel in an Election Year
Patrick Donahue, Birgit Jennen – Bloomberg
German government moves swiftly to douse bailout talk; Debate highlights chancellor’s tangled history with bank
In April 2008, as the global financial crisis was brewing, Angela Merkel hosted a 60th birthday reception in her Berlin chancellery for Deutsche Bank’s then-chief executive Josef Ackermann. Eight years later, her government is doing its best to keep Germany’s biggest bank at arm’s length.
/goo.gl/cBGqDC

Trump Slams Yellen’s Fed Again, This Time on a Much Bigger Stage
Jeanna Smialek – Bloomberg
Candidate’s criticism of low-rate policy goes unrebutted; Fed didn’t materialize in 2012 general-election debates
Donald Trump took aim at the Federal Reserve in front of millions of viewers during the first 2016 presidential debate, accusing the U.S. central bank of playing politics in a challenge to its legitimacy that could have lasting consequences.
/goo.gl/sA1SpC

Investing and Trading

Global debt climbs towards fresh high as companies and countries keep on borrowing
Szu Ping Chan – The Telegraph
Global debt issuance is on course to hit a record high in 2016 as figures showed sales this year topped $5 trillion (£3.9 trillion) at the end of September. Debt issuance rose to $5.02 trillion in the nine months to September 22, according to Dealogic, putting 2016 on course to beat the all-time high of $6.6 trillion recorded in 2006.
/goo.gl/VjFl8Y

Why Money Is Rushing Into Venture Capital; Canvas Ventures joins a parade of VC firms amassing larger funds this year, but some investors fear the music will stop.
Sarah McBride – Bloomberg
Venture capitalists may be storing up supplies for winter. With VC fundraising on track for its best year since the dot-com era, some investors say there’s a rush to raise cash before it disappears.
/goo.gl/NmXRvk

BlackRock Issues Warning on Treasuries as Fed Moves Toward Hike
Wes Goodman – Bloomberg
It’s time to rethink the role of U.S. Treasuries, Turnill says; 10-year yield to exceed 2% in 2017, survey of analysts signals
BlackRock Inc., the world’s biggest money manager, said investors should be wary of Treasuries as the Federal Reserve moves toward raising interest rates.
/goo.gl/6PhUqV

Tudor’s Existential Moment
Lisa Abramowicz – Bloomberg Gadfly
In general, the hedge-fund industry is starting to stabilize after more than a year of severe withdrawals. But there’s one significant exception: For a handful of large macro funds, the pain continues.
/goo.gl/Pxy9pY

Perry Capital Closing Flagship Fund After Almost Three Decades
Katia Porzecanski and Katherine Burton – Bloomberg
Richard Perry, one of the biggest names in hedge funds, is calling it quits after 28 years. Perry, 61, is winding down his New York-based flagship fund as the industry confronts one of the most tumultuous periods in its history. In a letter to investors Monday, he said his style of investing no longer worked.
/goo.gl/DSHsej

Institutions

The Deutsche Bank crisis could take Angela Merkel down – and the Euro
Matthew Lynn – The Telegraph
There are some words that make such an unlikely pairing that we find it hard to put them together. Italy and efficiency, for example. Or Bake Off and Channel 4. And ‘Germany’ and ‘banking crisis’ is another one. Our image of German banks, and the German economy, as completely rock solid is so strong that it takes a lot to persuade us they might be in trouble.
/goo.gl/TAEKW9

Deutsche Bank denies seeking help from Berlin over DoJ
James Shotter, Laura Noonan and Thomas Hale – Financial Times
Deutsche Bank has denied seeking assistance from Berlin and said it had no plans for a capital increase after investors attacked the embattled bank, sending its share price to its lowest levels in more than three decades.
/goo.gl/hdJK3o

Wells Fargo Sued by Shareholders Over Cross-Selling Scandal
Kartikay Mehrotra – Bloomberg
Wells Fargo & Co. was accused of misleading shareholders about its opening of unauthorized accounts and blamed for a 9 percent drop in the bank’s stock price when details became public this month.
/goo.gl/vwvGZM

Wells Fargo Mulls Creating New Europe Unit After Brexit Vote
Giles Broom – Bloomberg
Frankfurt, Paris, Amsterdam are options, EMEA chief Pizzo says; Bank will retain a presence in London, despite Brexit: Pizzo
Wells Fargo & Co. won’t wait for the U.K. to formally trigger an exit from the European Union before taking steps to ease the impact on its business, according to the U.S. lender’s top executive in Europe.
/goo.gl/WHjNjy

RBS CEO Mulls ‘Uncharted Territory’ of Failure to Sell Division
Richard Partington – Bloomberg
Ross McEwan says bank is ‘having to think about the what ifs’; RBS must sell 314 branch unit to meet European Union rules
Royal Bank of Scotland Group Plc Chief Executive Officer Ross McEwan indicated he may fail in his plan to sell the bank’s Williams & Glyn consumer and commercial division to a rival lender before the end of this year.
/goo.gl/Omxn2X

Opinion: Mervyn King says this is the future of central banks
MarketWatch
For some eight years now, central banks around the world have been trying to generate an economic recovery. Despite their efforts, a sustainable recovery remains elusive and the banking system, bailed out and recapitalised in 2008, remains fragile, especially in Europe and China. Being seen as the only game in town is becoming a burden on central banks.
/goo.gl/VTdPXo

Fintech

Boat adds innovative insurance offering to increasing portfolio of services
Cinnober
Boat Oasis – the latest shared service specifically designed for the insurance industry; Partnering with member owned not-for-profit company Oasis LMF ; Ten managing agents supporting the first offering of hurricane and earthquake models
Boat Services Ltd, a fully owned subsidiary of leading exchange and clearing technology supplier Cinnober, has signed an agreement with Lloyd’s of London and ten managing agents to provide access to catastrophe models via the Oasis Loss Modelling Framework under a shared service arrangement.
/goo.gl/pwuBdJ

Snapchat Has 60 Million Daily Users in World’s Biggest Ad Market
Sarah Frier – Bloomberg
Number represents about a third of Facebook’s audience; U.S. is most lucrative market for social media advertising
Snapchat now has more than 60 million daily active users in the U.S. and Canada — about a third of what Facebook Inc. has in the world’s most lucrative advertising market.
/goo.gl/9ShwyD

Too Many Tiny IPOs Leave Tokyo 25 Years Behind Silicon Valley
Yuji Nakamura, Takashi Amano – Bloomberg
Trace the roots of most modern Japanese tech companies back far enough and there’s a good chance you’ll stumble across a little-known venture capital firm called Jafco Co.
/goo.gl/dDynWI

Congratulations America: Your Paycheck Will Soon Clear in One Day; The 40-year-old network that moves money among U.S. banks is finally getting an upgrade.
Ben Steverman, Jennifer Surane – Bloomberg
It’s Friday, and your paycheck is missing a zero. Even if payroll owns up to it, you could be waiting until Wednesday to get your money. Your power company is threatening a penalty for an overdue balance? Don’t expect your last-minute payment to get there in time. Waiting for the market to drop before buying stock? By the time the money gets to your mutual fund, it will probably have recovered.
/goo.gl/AfgNNh

Regulation

S.E.C. Takes Different Strategy in Insider Trading Case
Peter J. Henning – NY Times
The Securities and Exchange Commission’s latest insider trading case, against the prominent hedge fund manager Leon G. Cooperman, will test whether the old proverb “where there’s smoke, there’s fire” is enough to prove a violation.
/goo.gl/hKSqSX

Fed’s Tarullo raises prospect of bank break-ups
Ben McLannahan – Financial Times
The biggest US banks should be prepared to break themselves up if they struggle to adjust to new rules designed to ensure they could withstand the most severe of shocks to the system, the most powerful US banking regulator has suggested.
/goo.gl/W40xzp

BofA to pay $15.5 million fines for causing ‘mini-flash crashes’
Suzanne Barlyn and Jonathan Stempel – Reuters
Bank of America Corp (BAC.N) agreed to pay a total of $15.5 million in fines to settle charges by U.S. regulators and exchanges that lapses in its Merrill Lynch unit’s risk controls disrupted trading in 15 stocks, leading to “mini-flash crashes.”
/goo.gl/PtlKVK

Merrill Lynch Charged With Trading Controls Failures That Led to Mini-Flash Crashes
SEC
The Securities and Exchange Commission today announced that Merrill Lynch has agreed to pay a $12.5 million penalty for maintaining ineffective trading controls that failed to prevent erroneous orders from being sent to the markets and causing mini-flash crashes.
/goo.gl/5dGr8c

Bill Gross wins access to some Pimco records in bonus lawsuit
Jonathan Stempel and Jennifer Ablan – Reuters
Pacific Investment Management Co must turn over some records sought by its former star bond fund manager Bill Gross, who is pursuing a $200 million lawsuit claiming he was forced to resign so that his bonus could be divided among others.
/goo.gl/YRZiby

Federal Reserve proposes new limits on Wall Street energy bets
Patrick Rucker and Olivia Oran – Reuters
The Federal Reserve on Friday outlined a plan to limit Wall Street bets on the energy sector by forcing companies like Goldman Sachs and Morgan Stanley to hold more capital against such investments.
/goo.gl/rnRJQb

Senator seeks SEC probe of Yahoo hack
Reuters
Democratic Senator Mark Warner on Monday asked the U.S. Securities and Exchange Commission to investigate whether Yahoo and its senior executives fulfilled obligations to inform investors and the public about a hack affecting 500 million user accounts.
/goo.gl/qRnG6w

Erdogan sees ‘ulterior motives’ in U.S. case against gold trader
Ayla Jean Yackley – Reuters
President Tayyip Erdogan believes U.S. federal attorneys had ulterior motives in including references to him and his wife in court papers related to their prosecution of a gold trader, Turkish media on Sunday quoted him as saying. Reza Zarrab, a dual Turkish-Iranian national, was arrested in Miami in March. He was charged with helping Iran process millions of dollars in transactions that violated U.S. sanctions against Tehran in effect at the time.
/goo.gl/wV0bgZ

SEC drops some claims against ex-Thornburg Mortgage executives
Reuters
The U.S. Securities and Exchange Commission has dropped several claims against two former executives at now-defunct home lender Thornburg Mortgage Inc in a lawsuit brought in the wake of the 2008 financial crisis.
/goo.gl/NQIY36

SEC Charges CEO and Boiler Room Operator With Fraud
SEC
The Securities and Exchange Commission today charged a former microcap company CEO and a boiler room operator with defrauding seniors and others who were pressured to invest in a pair of penny stock companies and promised lucrative profits.
/goo.gl/B8Ccdi

Sebi increases checks and balances for brokers
Business Standard
Capital market regulator Securities and Exchange Board of India (Sebi) on Monday introduced a slew of checks and balances on stockbrokers, aimed at improving risk management and transparency in the system.
/goo.gl/hppzUt

Sebi issues disclosure norm for commodity exchanges
Business Standard
Markets regulator Securities and Exchange Board of India (Sebi) on Monday asked commodity exchanges to make quarterly disclosure about disablement of member terminals, along with duration of such activity, due to shortage of funds and margins.
/goo.gl/RXxTkc

Regions

Drawn-out Brexit negotiations will hurt eurozone, warns Draghi
Szu Ping Chan – The Telegraph
Eurozone growth is likely to suffer if Brexit negotiations become protracted, according to the president of the European Central Bank. Mario Draghi described the UK as an important trading partner for the single currency area as he said Britain’s “destiny” would also impact the 19-nation bloc.
/goo.gl/N7G6Yn

Russian Wheat Exports Disappoint as Low Prices Slow Farmer Sales
Anatoly Medetsky – Bloomberg
Level of shipments seen as low, given nation’s record crop; Egypt’s fungus policy caused prices, shipments to fall
Russian wheat exports haven’t lived up to expectations so far this season as falling prices made some growers reluctant to sell grain to traders amid a halt in purchases by Egypt, the world’s largest buyer.
/goo.gl/6fSLCp

Iran Now Has the Edge in the Fight Over Oil Prices With Saudi Arabia
Javier Blas – Bloomberg
Riyadh is pushing for first oil production limits in 8 years; Iran is resisting Saudi-backed plan to freeze its own output
Suddenly the tables have been turned on Saudi Arabia.
/goo.gl/fJCmsc

Brexit May Spark ‘Substantial’ London House-Price Drop, UBS Says
Jack Sidders – Bloomberg
London’s housing market faces severe price declines if the U.K.’s vote to leave the European Union triggers an extended period of economic weakness, according to UBS Group AG.
/goo.gl/kxgFhy

UBS, JPMorgan can’t match China bank IPOs
By JUN LUO – Bloomberg News
Jamie Dimon and Sergio Ermotti starred in the roadshow promoting Postal Savings Bank of China Co.’s share sale
/goo.gl/SQuFI9

Miscellaneous

Rick Bayless sells Frontera Foods to ConAgra
Peter Frost – Crain’s Chicago Business
What started off as a business plan pitched to Rick Bayless by a fan and MBA student has just been sold to one of the largest food manufacturers in the world. Frontera Foods, the Chicago-bred and -based packaged-foods company founded in 1996 by Bayless and the brand’s CEO, Manny Valdes, was acquired today by Chicago-based ConAgra, the maker of processed foods such as Slim Jim, Reddi-Wip and Hunt’s. Terms were not disclosed.
/goo.gl/VEhtCD

No Breakup for Pfizer? No Problem for Wall Street
Charley Grant – WSJ
Pfizer’s decision not to split into two companies came as a disappointment to Wall Street. But investment bankers are likely to get a consolation prize.
/goo.gl/jSTtwC

I Trashed the Economy When I Was Head of the Fed
By Mark Gilbert
The San Francisco branch of the Federal Reserve has a game on its website that lets you play at being Chair of the Federal Reserve. After tinkering with it, I’ve come to some conclusions: Modeling the economy is a mug’s game, short-term interest rates are a poor tool for steering the economy, and I should never be given the job of running a central bank.
/goo.gl/x2GU0y

Eight-Cent Eggs: Grocery Prices Are Plunging
Craig Giammona – Bloomberg
Wal-Mart effect combines with deflation to eat away at margins; Two-for-one sirloins? How about a nice deal on a wagyu steak?
Call it the Great Grocery-Store Giveaway of 2016.
/goo.gl/0HkCD0

0.00 avg. rating (0% score) - 0 votes

About Author

Doug Ashburn is a former editor-at-large of John Lothian News. He left in late 2016 and is now the managing editor of T3 Custom.