Breaking News

High-frequency traders discredit Japanese stock market narratives; Deutsche Boerse expects EU statement of objections to London Stock Exchange merger in second week of December; Virtu calls on US regulator to examine risks of ETFs

First Read

Happy Thanksgiving
John Lothian News Team

Just a quick note to say Happy Thanksgiving to all. It’s a great time to sit down with friends and family and reflect on the things we are grateful for.

We are especially grateful for all of you, our readers, sponsors, friends and family. We are thankful for all of you.

We wish you a safe and happy holiday. We’ll be back on Friday.

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The Commodities Disruptor
by Chris Outcalt – Galvinize
It was 3 a.m., and the warm Kenyan air smelled of jet fuel. Julie Lerner had just completed a 36-hour journey and stepped onto the runway at Jomo Kenyatta International Airport in Nairobi, Kenya. Her first time in Africa. A few days before her trip, a massive fire had erupted in the airport’s main terminal. The fire made headlines worldwide because the day it broke out happened to mark the 15th anniversary of al-Qaeda attacks on U.S. embassies in Kenya and Tanzania, and officials were concerned the incident might be related. Lerner heard the news from her home in Denver; but when the time came, she boarded the flight to Nairobi anyway.
/goo.gl/MSSRhT

***** Nice coverage of one of the least told success stories in the industry.

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SGX Titan

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Chicago Tech Community Rallies Together For a Great Cause
3 Points Communications
This past Thursday, the Chicago tech and fintech community came together for the third annual T4Youth table tennis tournament. 3Points has been a co-organizer of the event each year after co-founding it in 2014, and we do it because we truly believe in the cause it supports?—?the tournament benefits the Chicago Tech Academy (ChiTech), a four year contract high school in University Village that exposes low-income students to STEM and entrepreneurship courses. ChiTech not only provides a way for the tech community to give back, but it gives important training to young people who, in a few years’ time, will strengthen Chicago’s tech workforce themselves.
/goo.gl/9pxol7

***** These tech guys may be good at table tennis, but did they learn their skills like I did playing pong?

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FINRA moves to speed up market manipulation crackdowns
By John McCrank – Reuters
Wall Street’s industry-funded watchdog took steps to crack down more quickly on manipulative trading practices in the securities markets but needs more authority, according to a regulatory filing.
/goo.gl/UF3nuf

***** FINRA and the word “quickly” in the same sentence is an interesting combination. They move at the speed of regulation.

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CFTC sees huge drop in fines for 2016; Swaps regulator’s treasury contribution falls from $2.8bn to $484m year-on-year
Chris Hawes – HFM
The CFTC saw a huge slump in the penalties collected over the past fiscal year, falling to $1.3bn from $3.1bn a year earlier, annual enforcement results have revealed. However, the number of enforcement actions started by the swaps regulator rose from 69 in FY 2015 to over 100 in FY
/goo.gl/8SfUPc

***** You know, I am not sure if this is good news or bad news. Did the CFTC not catch as many bad guys, or is there less fraud out there this year? Why am I laughing as I write this?

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Ice cream for breakfast makes you smarter, Japanese scientist claims
Julian Ryall – Telegraph
In a discovery that will give nutritionists the shivers, a Japanese scientist has discovered that consuming ice cream for breakfast improves a person’s alertness and mental performance.
/goo.gl/2n88Ed

**** I am willing to give this theory a try.

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Anthony Pereira, Percentile – A Technical Ride Through Two Market Crashes

MarketsWikiEducation.com

“What [the dot-com bubble] made clear to me was that the marketplace and what was actually going on in the world of software development were two very different things.”

All Anthony Pereira, founder and CEO of Percentile, had wanted to do was build software and write code. That took him to the frontlines of two industry crises: he worked for a tech company during the dot-com bubble and a bank during the financial crisis. During the tech bubble, he saw paper millionaires get wiped out when his firm’s stock went from $300 to $6. With that came the realization that people really can just get carried away. That fact was again hammered home during the Lehman Brothers bankruptcy, when Pereira witnessed banks and other counterparties struggling to figure out their exposure to Lehman.

In this video, Pereira talks about what he learned from the rollercoaster ride of the last 20 years.

Watch the video »

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Tuesday’s Top Three
Whether out of empathy, envy, or schadenfreude, our readers clicked most on the
Bloomberg story, Affluenza Anonymous: Rehab for the Young, Rich, and Addicted. Second most popular was another Bloomberg story, Nasdaq’s New CEO Prepared Years for the Job. Then Trump Happened, and number three was a repeat from yesterday’s top three (and yet another Bloomberg story), Inside a Moneymaking Machine Like No Other

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Lead Stories

High-frequency traders discredit Japanese stock market narratives; Regulators and Tokyo Stock Exchange forced to pay more heed to high-frequency traders
by: Leo Lewis – FT
Most trading days, just after the morning trading session finishes, a few familiar faces pile into the Seattle’s Best Coffee branch next to the Tokyo Stock Exchange (TSE). They linger over espressos before returning to an office that stands about 10 metres from the bourse.
/goo.gl/e2wLvs

Deutsche Boerse expects EU statement of objections to London Stock Exchange merger in second week of December
City A.M.
Deutsche Boerse expects the EU competition regulator to publish a statement of objections to the company’s £21bn merger with the London Stock Exchange next month.
/goo.gl/sdVRbP

Virtu calls on US regulator to examine risks of ETFs
Nicole Bullock – Financial Times
Virtu Financial, the high speed middle man, has urged the US Securities and Exchange Commission to examine operational risk associated with exchange traded funds, according to a letter filed with the regulator. Calling it an “area that deserves a closer look,” Virtu’s letter comes as the SEC is preparing a broad review of the rapidly growing ETF industry, reflecting concerns that flows into the sector may be exacerbating market volatility. The SEC, which has a working group studying the area, is expected to examine every aspect of the industry and the consequences of its growth.
/is.gd/NbL4Ne

Redemptions From Hedge Funds Are Widespread And Persistent
ValueWalk
Hedge funds continue to face difficult times, but the $3 trillion industry is not on the verge of disappearing. Savvy institutional investors have more choices, more technology and more influence on their side than ever before. The largest allocators may find it more cost effective to bring resources in-house rather than to pay high fees for mediocrity, while others may turn to replication strategies, or ETFs, but also increasingly to private markets which hold the perception that value has more potential to be realized, and manager expertise is more critical in that process.
/goo.gl/aN3CFA

****SD: From the story – “Redemptions from managed futures were the largest in nearly two years as performance issues began to impact investor sentiment.”

Kochs and Other Madoff Investors Are Winners in Fight Over Profits Held Abroad
By RANDALL SMITH – NY Times
David Koch at a gala in 2015. Credit Krista Schlueter for The New York Times
The company led by the American billionaire Koch brothers, along with dozens of banks and fund managers, kept billions of dollars in profit from Bernard L. Madoff’s Ponzi scheme in accounts offshore. As it turns out, that was a good decision.
/goo.gl/yhgTMr

Trump’s Day One Vow Can Alter Energy Rules But Not Market Forces
Jennifer A Dlouhy – Bloomberg
President-elect Donald Trump can deliver on his promise to remove restrictions on U.S. energy production hours after taking office, even though it will take more than the stroke of a pen to rewrite the shifting economic landscape for coal, oil and gas.
/goo.gl/6HjUnC

Odds of a December Rate Hike: 100.2% (Briefly)
Alexander Osipovich – WSJ
CME Group’s closely watched FedWatch tool on Tuesday briefly indicated that the probability of a rate hike from the Federal Reserve next month was 100.2%. The surprising number was due to a never-before-seen glitch in the way CME calculates the odds of a rate increase, the exchange operator said, adding that it was working to resolve the issue.
/is.gd/ORG43U

Macaskill on markets: Bank trading desks set to win bigly under Trump
Jon Macaskill – Euromoney Magazine
Traders are the most Trump-like figures within banks. They have short attention spans, crave instant rewards and view consistency as a weakness rather than a virtue. Like Trump, traders have been feeling unloved in recent years but now have an unexpected chance to reassert themselves on a big stage. The trading performance of big firms in the coming quarters will help to determine whether the sharp rally in global bank stocks since the US election becomes a sustainable recovery that helps share prices to stabilize above the nominal value of banking assets.
/goo.gl/Bt6IJj

JP Morgan lays out new global electronic trading team
Joe Parsons – The Trade
JP Morgan has laid out a new markets execution team, as it looks to refocus its trading strategy towards electronic execution. Following the hire of David Hudson as head of markets execution earlier this year, it has named Richard James, its current head of currencies and EM execution services, and Peter Ward, head of futures and options executions services, as co-heads for the division’s macro products.
/goo.gl/YXpqCg

****SD: More JP Morgan action – JPMorgan hires Debra Herschmann

Why MSCI and S&P Dow Jones Indices Began Working Together in One Important Way
Reid Steadman – S&P Dow Jones Indices
MSCI and S&P Dow Jones Indices respect each other, as good rivals should, but we often disagree. We see South Korea as a developed market and MSCI classifies it as emerging; we have 500 companies represented in our leading US index and MSCI has 295; we have our own free float methodology and they have theirs. However, we agree in at least one respect: in our approach to classifying stocks by sectors and industries.
/goo.gl/VEcMF5

These Charts Show That Trump Is Bringing the 1990s Back to Markets; We’ve seen this before, sort of.
Narae Kim – Bloomberg
Donald Trump’s election as U.S. president is driving global markets to levels not seen in nearly two decades — but in completely different directions. And the “polarization'” of emerging and developed markets is all part of “Trump reflation,” argues Divya Devesh, a foreign-exchange strategist at Standard Chartered Plc in Singapore.
/goo.gl/3PfH5f

Why moral companies do immoral things; Are sins more common at companies that believe they embody ethical virtue?
by: Michael Skapinker – FT
Many of us think we are harder working, more intelligent and better drivers than the average person. We also think we are morally superior. A 2014 study found that even convicted prisoners thought they were morally better — not just than the average prisoner but than the average person outside.
/goo.gl/VqqPYz

***** We are all capable of sin and lawlessness. And we are all eligible for forgiveness.

The CME Global Financial Leadership Conference 2016 (GFLC)
Maven Wave
The CME Global Financial Leadership Conference 2016 (GFLC) is a conference unlike any other. Each November, the CME and its invited guests assemble in Florida for a two-day meeting to listen and interact with the brightest luminaries in the world of politics, economics, and other fields. Coming just one week after the U.S. Presidential election, it’s no surprise the conference kicked off with appearances from a former Speaker of the House, two former British Prime Ministers, along with two of the most important people in the election teams of George W. Bush and Barack Obama. The balance of day two turned to economic matters and a look at fintech before finishing up with an appearance with the most decorated Olympian in modern history and a once-in-a-lifetime panel of sports legends.
/goo.gl/CfIISw

***** Chuck Mackie does not know how to stop writing all the time.

Exchanges, OTC and Clearing

Deutsche Börse acquires stake in figo
Deutsche Börse
DB1 Ventures, the investment vehicle of Deutsche Börse AG, has participated in the series B financing round of the Hamburg-based FinTech company figo GmbH and is investing a seven-digit amount for a significant minority interest. Other investors are well-known business angels from Germany. In total, figo received around 6.8 million euros in the current financing round.
/goo.gl/Q8NozV

Euronext opts for LiquidMetrix’s best execution analytics platform
Hayley McDowell – The Trade
Euronext has announced plans to implement Strategic Insight’s LiquidMetrix best execution analytics platform for its equity, ETF and derivatives products. LiquidMetrix’s best execution analytics platform provides transaction cost analysis and surveillance tools to help its users prove best execution under MiFID II regulation.
/goo.gl/m9B3oI

Euronext selects Strategic Insight’s LiquidMetrix for its best execution analytics platform
Euronext
Euronext, the leading pan-European exchange in the Eurozone, today announced that it has selected Strategic Insight’s LiquidMetrix – the industry leading solution for best execution, transaction cost analysis (TCA) and surveillance services- as best execution analytics platform for its equity, ETF and derivatives products. Euronext will be using LiquidMetrix to help its clients demonstrate best executionand provide them with valuable insights for their multi-asset trading activity.
/goo.gl/Df52Qi

STOXX changes the composition of benchmark indices
Deutsche Börse
The STOXX Europe 600 Index, STOXX North America, is a registered trademark of STOXX, Inc., a registered trademark of STOXX, Inc. All other trademarks are the property of their respective owners 600 Index and STOXX Asia / Pacific 600 Index.
/goo.gl/Vn2vIc

A Regulatory Solution To Canada’s Market Data Problem
Mondovisione
Aequitas Innovations Inc. and its subsidiary Aequitas NEO Exchange Inc. are disappointed that the Competition Bureau of Canada has decided not to continue its investigation into the TMX Group at this stage. The Competition Bureau opened up an investigation after NEO filed a formal complaint requesting a federal investigation into certain anti-competitive practices of the TMX Group in December 2015. NEO believed, and continues to believe, that the TMX Group is using its dominant market position to maintain control over the pricing of market data in the Canadian capital markets. The main victims of the lack of consolidated market data outside of trading desks and proprietary trading firms in Canada are the retail investors, their investment advisors and public listed companies.
/goo.gl/LnnhzW

Eris Exchange Newsletter – November
Eris Exchange
RECORD – Eris Standard OI reached 131,368; RECORD – Eris Standard OI = 76% of total OI
/goo.gl/LJHWa4

CME delays corn futures contract listings, eyes St. Louis delivery point
Reuters
The CME Group will delay listing of two corn futures contracts that had been scheduled to start trading on Dec. 14 as it continues a review of delivery points which could expand to St. Louis in Missouri, the exchange said in a statement on Tuesday. The delay covers the July 2020 and December 2020 contracts. The exchange said it would also delay listing of all subsequent months.
reut.rs/2fCx6CI

TOCOM and S&P Global Platts Sign Memorandum of Understanding
The Tokyo Commodity Exchange, Inc. (TOCOM) and S&P Global Platts (Platts), announced today that they have signed a Memorandum of Understanding (MOU), to cooperate in developing active markets and benchmark prices for Japanese domestic oil refined products and liquefied natural gas (LNG) in Asia.
/goo.gl/HwIzxA

THE 18th LATIBEX FORUM STARTS TOMORROW
BME
Over 30 companies and 250 intermediaries and investors will come together during this gathering
The 18th Latibex Forum, organised by BME, begins tomorrow with an opening event that will be presided over by José Manuel González-Páramo, CEO of BBVA; Luiz Fernando Leone, CEO of Brazilian power utility Copel; Manuel Manrique, Chairman and CEO of Sacyr and Antonio Zoido, Chairman of BME.
(NOLINK)

BME AND BIG BAN ANGELS CREATE THE FIRST PRE-MARKET ENVIRONMENT IN SPAIN FOR START-UPS
BME
BME and Spain’s National Business Angels Association, Big Ban Angels, have struck an agreement to create the first pre-market environment for start-ups in Spain. The chief objective of the environment is “for entrepreneurs to acquire a stock market culture as an investment option, set up links and communication and boost their investor visibility”, explained Big Ban Angels President, Tomás Guillén.
(NOLINK)

Politics

Trump’s foundation says it violated ‘self-dealing’ ban: IRS forms
Emily Stephenson, Julia Harte, Nate Raymond and Susan Heavey – Reuters
U.S. Republican President-elect Donald Trump’s charitable foundation said it violated a ban on so-called “self-dealing” by transferring income or assets to a “disqualified person,” according to a copy of its 2015 tax filings made public this week.
reut.rs/2fCxNMq

The consent of the governed: The hole at the heart of economics
The Economist
America has a debt ceiling. It’s a statutory limit on how much debt the federal government can issue. For most of its existence (the ceiling will turn 100 next year) Congress has simply voted to raise the limit when borrowing threatens to hit it. In 2011 and 2013, however, Republicans in Congress chose a different approach. They threatened not to vote to raise the ceiling unless various budget demands were met.
econ.st/2fCDbiH

Expectations for Trump Fiscal Stimulus Are Starting to Fade – Income Investing
Amey Stone – Barron’s
President-elect Donald Trump isn’t even in office yet and already expectations for the amount of fiscal stimulus his administration will provide are starting to wane. Trump released a You Tube video describing his priorities for his first 100 days, which didn’t say anything about infrastructure spending, tax cuts or repatriation of corporate cash held overseas.
on.barrons.com/2fCyLbf

Billionaires vs. the Press in the Era of Trump
Emily Bazelon – NY Times
In 2005, Tim O’Brien, then a financial reporter at The New York Times, published the book “TrumpNation: The Art of Being the Donald.” O’Brien talked to sources with an up-close view of Donald J. Trump’s finances, who concluded that the real-estate developer’s net worth was $150 million to $250 million, rather than the $2 billion to $5 billion Trump had variously claimed..
nyti.ms/2fCLT0o

Investing and Trading

Index IDEA: European asset owner shows commitment to investing in green economy
FTSE Russell
European investors are putting their money where their mouth is lately when it comes to committing assets to climate-adjusted, or “green” investment strategies. And, at the same time, they are learning it is possible to precisely target various emerging green economic factors through using a smart beta index-based approach. This reflects their beliefs that both risk premia factors and climate parameters are important components when assessing long-term risk adjusted returns.
/goo.gl/uaP0jZ

Small caps: Unlikely heroes of an aging bull market?
Tom Goodwin, Sr. Research Director – FTSE Russell
July marked a milestone for the current bull market – now the second longest on record. While it certainly does not feel like a momentous occasion, the data indicates otherwise. You might say, this is just a very slow moving bull whose pace is to a large extent dictated by slow underlying economic growth. In such slow-growth economic conditions, the perceived stability of large cap companies may sound alluring but history tells different story.
/goo.gl/N2bgoS

Steven A. Cohen Makes a Move Into Index Funds
Telis Demos – WSJ
A hedge fund titan of active investing, Steven A. Cohen, is making a bet on tiny investments in passive index funds. Point72 Ventures, an early-stage venture fund backed by Mr. Cohen’s Point72 Asset Management LP, has invested $2 million in Acorns Grow Inc., a millennial-focused app maker that encourages users to make regular small-dollar contributions into a basket of exchange-traded index funds as a way to start saving.
/is.gd/cyXzC4

Q&A With Jack Bogle: ‘We’re in the Middle of a Revolution’
By Michael Regan – Bloomberg
Princeton senior thesis in 1951, arguing that mutual funds “may make no claim to superiority over the market averages.” Sixty-five years later, the Vanguard founder is still being forced to defend his argument—perhaps now more than ever.
/goo.gl/KgHQKU

Brevan Howard reverses decline as flagship fund performs; Main Master Fund puts hedge fund on track for first positive year since 2013
by: Lindsay Fortado, Hedge Fund Correspondent – FT
Brevan Howard, one of Europe’s largest hedge funds, has started to reverse several years of poor returns after capitalising on market moves before and after the US election.
/goo.gl/TOjhv1

Engelhart co-founder set to leave after quarterly loss
Emiko Terazono, Neil Hume and David Sheppard – Financial Times
One of the trio of executives who launched commodity trader Engelhart CTP is set to leave the business as it struggles to contain the fallout from a near quarter-billion dollar loss. Chief operating officer Nick Brewer is currently on leave, according to people close to the company, and is expected to depart in the near future. Engelhart, the London-based trading firm spun out of Brazilian bank BTG Pactual, lost about $225m in the third quarter after large wrong-way bets on crude oil, grains and oilseeds. These trades wiped out more than 20 per cent of the net income that it had earned since its launch four years ago.
/is.gd/8qhz4j

Institutions

Ireland reluctant to host high-risk bank trading after Brexit – sources
Anjuli Davies and Padraic Halpin – Reuters
Ireland has signalled to several large investment banks it would be reluctant to host large trading operations, banking sources told Reuters, despite Dublin’s desire to attract financial sector jobs from London after Britain leaves the EU.
reut.rs/2fCHFWB

Hedge funds have mostly missed the Trump rally
Ryan Vlastelica – MarketWatch
The U.S. stock market has been on a tear ever since Donald Trump unexpectedly won the presidential election earlier this month, but hedge funds are largely missing out on the party, Goldman Sachs wrote in a report published late Monday.
on.mktw.net/2fCBJg0

Freeing Fannie Mae and Freddie Mac
Gina Chon – NY Times
The election has resurrected the fiasco of how to fix Fannie Mae and Freddie Mac. Shares of the two bailed-out mortgage agencies have rocketed over the last two weeks on hopes that the Trump administration might end government oversight. Big political roadblocks remain, though.
nyti.ms/2fCHXww

Former ITG chief re-emerges at Barclays
Joe Parsons – The Trade
ITG’s former chief executive, Bob Gasser, has officially joined Barclays to lead the bank’s internal technology operations.
/goo.gl/xniuvQ

Exclusive: Credit Suisse Loses London Head of Spot FX Martin O’Donoghue
Victor Golovtchenko – Finance Magnates
The Head of Spot FX Trading at Credit Suisse Martin O’Donoghue has left the company, multiple sources with knowledge of the matter have shared with Finance Magnates. A company spokesperson has not commented on the matter.
/goo.gl/9ZRoAh

Fintech

Wall Street’s Youngest Workers Aren’t Worried Robots Will Replace Them
Hugh Son – Bloomberg
Ah, youth.
As growing legions of graying Wall Streeters worry that technology is about to make them obsolete, the industry’s most junior staffers are almost unanimously expecting brighter days, according to an Options Group survey.
The recruiting firm asked more than 3,200 traders, salespeople and other finance professionals how advances over the next five years will impact them. In every bracket age 26 and up, at least 8 percent of respondents predicted they will lose their livelihood.
bloom.bg/2glCXxg

Blockchain may fuel the energy industry
Carlo R.W. De Meijer – Finextra
When talking about blockchain, up till recently there was not much happening in the energy industry. At least not in the spotlights. But that is rapidly changing. In April 2016, the ‘said’ world’s first blockchain managed energy trading transaction took place in Brooklyn, New York. The owner of a solar roof panel sold excess energy (a few kilowatt hours) to a neighbour using a smart contract of the Ethereum blockchain. This happened with the Brooklyn micro-grid which is managed by startup company LO3 Energy. During the EMART Energy 2016 event on November 3-4 in Amsterdam the first European megawatt-hour energy trade over a blockchain was executed by the Belgian Yuso and the Dutch Priogen Trading. And more trials are expected to come soon.
/goo.gl/e1FBTu

AI academic warns on brain drain to tech groups; Poaching of artificial intelligence talent could set back research, says Bengio
by: Richard Waters in San Francisco – FT
A brain drain of artificial intelligence talent to the biggest tech companies threatens to set back academic research in the field, according to one of the three experts credited with breakthroughs a decade ago that lie behind today’s biggest advances in AI.
/goo.gl/YsSn79

Meeder Leverages Eze Software Investment Suite Across Business Lines
Eze Software
Meeder Investment Management, the Dublin, Ohio-based provider of investment solutions, has tapped Eze Software Group’s Investment Suite to manage investment workflows across its business lines. The firm, with more than $13 billion (USD) in assets under management and administration, provides investment solutions to financial advisors, retirement plans, public entities, and individual investors. Eze Software Investment Suite gives Meeder access to integrated order management, execution management and portfolio accounting to manage a variety of business needs.
/goo.gl/nceeq3

Regulation

Despite Conflicts, Financial Overhaul Proposals Have Merit
Steven Davidoff Solomon – NY Times
The future of financial regulation is murky given the conflicting statements by President-elect Donald J. Trump, congressional Republicans and Senate Democrats. Some may panic, but looking at the whole picture, there may be some cause for optimism, at least when it comes to the big banks and the concept of “too big to fail.”
nyti.ms/2fCImz7

Madoff trustee lawsuits against Koch, others are dismissed
Jonathan Stempel – Reuters
A federal bankruptcy judge on Tuesday dismissed lawsuits by the trustee liquidating Bernard Madoff’s firm to recoup funds from Koch Industries Inc, the company controlled by billionaire brothers Charles and David Koch, and dozens of other defendants.
reut.rs/2fCA6ip

Galvin claims software developer defrauded investors in trading scheme
Grete Suarez – InvestmentNews
The head of the state securities department in Massachusetts charged a man and his trading software company with fraudulently taking money to trade in securities, and then failing to execute any trades.
/goo.gl/EKtx7i

China Regulator Warns Insurers After ‘Rat Trading’ in Stocks
Bloomberg
China’s insurance regulator said it will step up scrutiny of insurers’ stock-trading activities and punish violations, after barring a company from buying shares amid a probe into a former employee’s misbehavior.
bloom.bg/2fCFwKq

SEC Names Wesley R. Bricker as Chief Accountant
SEC.gov
The Securities and Exchange Commission today announced that Wesley R. Bricker will become the Chief Accountant and succeeds James Schnurr who plans to retire from the agency.
/goo.gl/AO9etU

Chief Accountant James Schnurr to Leave SEC
SEC.gov
The Securities and Exchange Commission today announced that Chief Accountant James Schnurr intends to retire from the agency. Mr. Schnurr began his tenure as the SEC’s chief accountant in October 2014.
/goo.gl/lrkrFB

Sebi likely to ease rules for angel funds
Business Standard News
Capital market regulator Securities and Exchange Board of India (Sebi) is likely to relax guidelines governing angel funds in the country. The regulator could also introduce more checks and balances for compensation agreements between private equity (PE) firms and senior management or promoters of a listed company. The announcements are likely after Sebi board meeting on Wednesday in Mumbai.
/goo.gl/wVKY5e

Justice Department ‘Hustle’ Case Against Bank of America Dies; The government doesn’t file a request to appeal a May ruling that threw out the fraud case tied to the financial crisis
By CHRISTINA REXRODE – WSJ
The government’s Hustle case against Bank of America Corp. is finally dead.
/goo.gl/q2T8ci

Sebi boosts start-up funding, relaxes rules for angel funds; Angel funds are allowed to invest in overseas venture capital undertakings up to 25% of their investible corpus in line with other AIFs
Business Standard
Seeking to give a fillip to start-up funding, markets regulator Sebi on Wednesday relaxed its rules for investment by angel funds in this space, including by allowing them to invest in up to five-year old entities.
/goo.gl/L1MxOB

U.S. SEC says ex-broker peddled securities after bar from industry
By Suzanne Barlyn – Reuters
A former Morgan Stanley broker who was barred from the securities industry later solicited $2.7 million from 10 elderly and retired investors without disclosing that his license was revoked, U.S. securities regulators said on Tuesday.
/goo.gl/ith495

Regions

Argentina biodiesel producers fear losing access to U.S. market
Maximilian Heath – Reuters
Argentina’s biodiesel producers fear losing access to the United States, the destination of nearly all their exports, after Donald Trump’s surprise victory in presidential elections earlier this month, representatives of the sector said.
reut.rs/2fCSuYr

China banks risk Lehman moment as wholesale borrowing rises; Potential for contagion as banks move away from deposit funding
by: Gabriel Wildau in Shanghai – FT
Chinese banks are increasingly reliant on funding sources that western peers used before the financial crisis, leading investors and analysts to warn that China’s financial system could be vulnerable to a Lehman Brothers-style collapse.
/goo.gl/3FjGHx

HSBC Said to Advise Saudi Pension Fund on Financial Hub Sale
Zainab Fattah and Matthew Martin – Bloomberg
Parties discussing sale of struggling $8b district in Riyadh; Initial offer was below Pension Agency’s cost; deal not final
The local unit of HSBC Holdings Plc is advising Saudi Arabia’s Public Pension Agency on the sale of its struggling financial hub to the country’s sovereign wealth fund, according to people familiar with the matter.
/goo.gl/bXX629

China’s reserves a ‘striking wild card’ for agri-commodities; How Beijing handles its reserves of soft commodities will help shape markets in 2017
by: Emiko Terazono – FT
China’s handling of its state reserves of raw materials such as cotton and sugar will be a key factor shaping the direction of agricultural commodities in 2017, according to a major lender to agribusinesses.
/goo.gl/x4ehrU

Potential gold-import ban by India could be biggest bombshell since Nixon
By Nigam Arora – MarketWatch
Back in August 1971, President Nixon shocked the world by taking the dollar off the gold standard. The dollar had been on gold standard since Bretton Woods Agreement of 1944. The biggest bombshell for gold investors in 45 years since Nixon announcement may be ahead. That bombshell is a potential ban on import of gold into India. If this happens, there is a high probability of a one-day drop in gold that could reach $200.
/goo.gl/eotwTP

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About Author

Bergstrom is chief information officer of John J. Lothian & Co. He edits MarketsWiki and JLN Options.