Breaking News

Special Report: How Brexit is set to hurt Europe’s financial systems; SEC’s Clayton Calls on Agency to Ease Disclosure Burdens on Public Companies; Fed Will Unwind the Balance Sheet at an Awkward Moment

First Read

MarketsWiki Education: Day Two in the City That Never Sleeps
By Spencer Doar, JLN Associate Editor (& Comedian in Residence)

What digs! Day two of our MarketsWiki Education series in the city so nice they named it twice was hosted by Thomson Reuters in their penthouse level Carnegie Hall Auditorium overlooking Times Square. Of course, the only way to get the Carnegie Hall Auditorium was via the “practice” elevator.

There were a few speed bumps along the way, but that was mostly due to Elaine Wah, IEX’s head of market quality. (Kidding of course — Wah spoke about the nature of fairness in markets and how fairplay intertwines with the origins of the venue.)

The day kicked off with Duncan Niederauer, former NYSE CEO, who made the whole crowd
aware of their lack of self-awareness. He said 80 percent of folks at any given workplace think of themselves as representing the top quarter of employees. Clearly, the math doesn’t work out and therefore plenty of people must lack self-awareness. As the ancient Greeks said, “know thyself.”

Dennis Dutterer, now retired, but an extremely familiar face in clearing, spoke about… well, it’s hard to encapsulate in a brief blurb. Suffice to say it involved a reference to “The Graduate,” Liverpool cotton traders and the advent of the telegraph. If you’re intrigued, now is a good time to remind you all we will be releasing videos of the talks in the ensuing weeks.

Anna Irrera, a Reuters correspondent focused on fintech, spoke about the current landscape and future of nascent (digital ledger sorts of things) and more developed (think the payments space) technologies. Irrera was amused when almost no one in the audience raised their hand when she asked who understood blockchain. She contrasted the response to industry conferences where everyone talks about distributed ledger technology and she suspects only a tiny minority actually get it. (No one phrased it quite this way, but the idea of posing, and why it’s bad to be a poser, was a thread throughout the talks.)

John Palmer, a former Batser, now CBOEer, delved into the art of risk and risk taking. As a small town Ohioan who grew up on a farm, made it into West Point and then left, he knows a thing or two about diving into the unknown. Oh, and a few years clerking in the CME’s eurodollar pits didn’t hurt either.

While New York is in the books, Monday marks the start of our Chicago MarketsWiki Education events. Monday and Wednesday’s sessions will be hosted by IIT and Friday’s will be at Trading Technologies’ HQ. There is still room at our Chicago events next week Monday and Wednesday but there is a waiting list for Friday. Please sign up or register your interns HERE

Once again, a sincere thank you to all of our sponsors and those who provided us with swag to distribute to attendees. These are truly team efforts.

And hey, since both sites were on Times Square, we got to see offbrand Elmos, Batmen and a mostly naked guitar playing cowboy every day. So, we got that going for us. Which is nice.

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Britain Is Shamed and Brussels Triumphant. But Is That Good for Europe?
By John Micklethwait – Bloomberg
A few capital cities acquire political personalities of their own, not always lovable ones. Donald Trump ran against “Washington” as much as he did against Hillary Clinton. For many people in Europe, “Brussels” is a political character—a bureaucrat plotting an ever-closer European union. That caricature has just staged a recovery that would put Lazarus to shame.
/goo.gl/McVkGp

***** Good summary of the current situation with Brexit.

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Wall Street Journal adds top jobs in digital push
By Sheila Dang – Reuters
The Wall Street Journal said on Wednesday it was adding more than a dozen new senior positions in a newsroom revamp to deliver news faster, with more visuals, as readers increasingly rely on smartphones.
/goo.gl/PXBwcS

***** I did this 10 years ago.

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In the economic circle of life, businesses are dying faster than ever
By Kai Ryssdal and Emily Henderson – Marketplace.org
Not to get all “Lion King” here, but there’s a circle of life in business, just like in the rest of the world. Companies are born, and they die. But now we’re facing an economic situation where companies are dying faster than they’re being created. That’s the upshot of a study by the Economic Innovation Group.
/goo.gl/iJH2vC

****** Sell by day. Fly by night

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EU regulators clamp down on social media searches on job applicants; Data protection chiefs’ guidelines could hit 60% of employers as stance hardens
Paul McClean in Brussels – FT
Employers who check a job candidate’s Facebook or Twitter profile before deciding whether to hire them may be in breach of European law, top regulators have said, as the EU tightens its data protection policies.
/goo.gl/3Y5GJQ

***** Brian Cassin of Vela Technologies at the MarketsWiki Education series in New York said the first thing he does to check out the job candidate is look them up on social media. But now there is an EU law against that.

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Farm Markets Trader Battles Cancer; His friends have labeled his gofundme account: Tough Like Todd
Mike McGinnis – Agriculture.com
It was nearly a decade ago when I first went to work on the floor of the Chicago Board of Trade, reporting on the daily ins and outs of the farm markets right here on Agriculture.com. I knew nobody. It was like walking through a rock concert and seeing only unfamiliar faces. One day, while working on a story about the options markets, I was introduced to a longtime soybean options trader.
/goo.gl/UvXAJn

***** Todd Swenson is a good man and a fine soybean option broker. It breaks my heart to hear this news. You can donate to the Go Fund Me page to help his three college age children HERE

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Wednesday’s Top Three
Our top three stories of the day were led by Crain’s piece on another firm calling it quits in Chicago trading firm Mocho. Second went to The Trade’s piece Exchange data made up a third of revenues in 2016. Third went to Bloomberg’s Bitcoin Is Having a Civil War Right as It Enters a Critical Month

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MarketsWiki Stats
104,278,906 pages viewed; 22,600 pages; 207,038 edits
MarketsWiki Statistics

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Lead Stories

Special Report: How Brexit is set to hurt Europe’s financial systems
Anjuli Davies, Huw Jones and Andrew MacAskill – Reuters
Like many multinational companies, Italian engineering business Brembo relies on London to run its finances. The company, based close to the Alps, makes brakes for Formula One cars and motorbikes and sells them in 70 countries. Hundreds of millions of euros pass through its bank accounts each year – and London is the hub for those flows.
/goo.gl/r8ps32

SEC’s Clayton Calls on Agency to Ease Disclosure Burdens on Public Companies; Chairman seeks to find ways to encourage growing companies to go public
By Dave Michaels – WSJ
The Securities and Exchange Commission is drafting proposals aimed at simplifying complex disclosures prepared by public companies for investors, its chairman said Wednesday.
/goo.gl/W5Hi3b

Fed Will Unwind the Balance Sheet at an Awkward Moment; Raising the government’s borrowing costs just when the government needs to cover growing deficits.
By Scott Dorf – Bloomberg
The playbook for U.S. Treasuries hasn’t changed much since the end of the Great Recession. First, traders come into a new year with a bearish bias, pushing up yields on the expectation that the conundrum of extremely low long-term rates will finally unwind as the economic recovery pushes on. Then, there’s a gradual capitulation as the global demand for Treasuries and disinflationary forces persist, driving yields lower in defiance of the Federal Reserve’s aggressiveness.
/goo.gl/Azgswh

High-Protein Wheat Crunch Concerns Mount as Rains Hit Germany
By Manisha Jha – Bloomberg
Downpours in EU’s No. 2 wheat grower may curb protein content; Drought has already cut this year’s U.S. spring-wheat crop
Rains in Germany, the European Union’s second-biggest wheat grower, are adding to concerns about a global dearth of high-protein crops favored for making specialty breads and pizza crusts.
/goo.gl/drjVnZ

Nex revenues boosted by China FX deal
Philip Stafford – FT
Nex Group reported a 10 per cent rise in first quarter revenues, reliant on its market infrastructure business as low market volatility crimped turnover from trading.
/goo.gl/j3r63b

Nex retreats on political donations after investor backlash; Exchanges operator reports 10% rise in first-quarter trading revenues
Philip Stafford – FT
Shareholders have barred Nex Group’s board from making political donations after the UK trading technology company backed five Conservative candidates at the general election.
/goo.gl/iXVYHw

Former Chief of Collapsed Bitcoin Exchange Mt. Gox Stands Trial in Tokyo
By Takashi Mochizuki – WSJ
More than three years after bitcoin exchange Mt. Gox collapsed, its former head went on trial this week as customers continued to wait for a clear answer on how exactly the company lost virtual currency valued in the hundreds of millions of dollars.
/goo.gl/YLdhQY

Bonfire of the Retail Stocks Brings Traders Running; Retreat creates fertile ground for bargain seekers, hedge-fund managers and day traders
By Ben Eisen and Amrith Ramkumar – WSJ
Shoppers’ retreat from department stores and mall chains is prompting stock traders to stalk the retail sector with a fervor unseen in years.
/goo.gl/GbQUEZ

New S.E.C. Chairman Pledges to Look After Ordinary Investors
By MATTHEW GOLDSTEINJ – NY Times
In his first public speech as the nation’s top securities cop, Walter J. Clayton sought on Wednesday to send a message that he would not shy away from looking out for the interests of mom-and-pop investors.
/goo.gl/RMjidn

Swiss private bank Falcon introduces bitcoin asset management
Brenna Hughes Neghaiwi – Reuters
Wealthy clients of Swiss private bank Falcon will be able to store and trade bitcoins via their cash holdings with the bank from Wednesday, a move that signals the traction the virtual currency is gaining even in slow-changing asset management.
/goo.gl/Ri2DY4

Biased Algorithms Are Everywhere, and No One Seems to Care
Will Knight – MIT Technology Review
Opaque and potentially biased mathematical models are remaking our lives—and neither the companies responsible for developing them nor the government is interested in addressing the problem.
This week a group of researchers, together with the American Civil Liberties Union, launched an effort to identify and highlight algorithmic bias. The AI Now initiative was announced at an event held at MIT to discuss what many experts see as a growing challenge.
/goo.gl/sQvfyz

Icma Warns on Euro Clearing Relocation; Trade body says any forced move could increase risks and costs for derivatives users
Brexit
James Rundle – Waters Technology
The International Capital Market Association (Icma) included access to market infrastructure as one of several risks attached to the UK’s departure from the European Union (EU), in its quarterly report released on July 12.
/goo.gl/J67AP5

Exchanges, OTC and Clearing

LME favourite to clear for new base metals platform NFEx – sources
Pratima Desai – Reuters
The London Metal Exchange is the favourite to clear trades for the new base metals platform NFEx as it would be the most efficient option for those wanting to use both venues, sources familiar with the matter said.
/goo.gl/GD5euE

NYSE Group Expands Opportunities for Listings of Special Acquisition Companies (SPACs) through Listings Rule Enhancements; Launches Three SPAC IPOs in Three Months Raising $1.2B
ICE
The New York Stock Exchange (NYSE), part of the Intercontinental Exchange (NYSE:ICE), has enhanced its listing rules and services platform to attract Special Acquisition Companies (SPACs) to list on the NYSE. A final rule filing for NYSE’s SPAC listings was approved by the SEC late last week.
/goo.gl/Gk3p5j

Prop firms say ‘no thanks’ to speed bumps on LME; The 140-year-old exchange group is consulting with members over its future strategy
By Samuel Agini – Financial News
The lobby group for Europe’s proprietary trading firms has urged the London Metal Exchange to bin any plans it has for the introduction of speed bumps on the 140-year-old exchange.
/goo.gl/MZe1TR

One of the biggest global currency exchanges is more excited about ethereum than bitcoin
John Detrixhe – Quartz
NEX Group operates dominant electronic markets for trading in the world’s most important assets, from US Treasury bonds to currencies like the euro and the dollar. Now, the company is taking a look at cryptocurrencies—particularly ethereum and ripplehttps://goo.gl/B8asRC

BOX Options Exchange Obliterates Status Quo with New Trading Floor Plans; BOX plans on opening a new pit manned by 40 human traders in direct opposition to other exchange leaders.
Jeff Patterson – Finance Magnates
A well-defined options playing field could see some degree of a shakeup as BOX Options Exchange moves to secure a greater percentage of the overall market share. The group is planning on opening a new floor with approximately 40 human traders. Consequently, the move is being met with widespread discontent from other exchanges, many of which filing complaints or letters criticizing the ambitions of BOX, according to a Wall Street Journal report.
/goo.gl/bQB24p

Trillium to Ring The Nasdaq Stock Market Closing Bell
By GlobeNewswire
Trillium, a proprietary trading and trading technology company, will visit the Nasdaq MarketSite in Times Square.
/goo.gl/9e8BWW

CDS Extends Agreement with DTCC’s GLEIF-Accredited GMEI Utility; Canada’s national securities depository, clearing and settlement hub extends commitment to helping clients more effectively manage systemic and counterparty risk
TMX
The Canadian Depository for Securities (CDS), a wholly-owned subsidiary of TMX Group, today commends The Depository Trust & Clearing Corporation’s (DTCC) subsidiary operating the Global Markets Entity Identifier utility (GMEI utility) on receiving official accreditation from the Global Legal Entity Identifier Foundation (GLEIF). The GMEI utility operates as the largest Legal Entity Identifier (LEI) issuer by share of the total LEIs issued worldwide.
/goo.gl/iUrmg8

Survey Finds Hong Kong Securities Market Attracts Wide Range of Investors
HKEX
The Cash Market Transaction Survey 2016 (the 2016 Survey) conducted by Hong Kong Exchanges and Clearing Limited (HKEX) found that Hong Kong’s securities market continues to attract a wide range of investors.
/goo.gl/g3ZdQi

Fintech

When Musical Artists and the Blockchain Converge; Bitcoin Magazine
By Michael Scott via Nasdaq
The 1999 launch of the file sharing service Napster was a seismic wake up call for the music industry. For many musicians and artists, the path to making a living became exponentially more challenging, particularly when it came to recorded music. Illegal downloads, declining CD sales, measly sales from legal music streaming portals and a consumer move from whole albums to single tracks all had a chilling effect on artists’ businesses.
/goo.gl/tMecHF

Witkowski’s Take: Fintech Charter Still on the Horizon; Trump administration appears to be warm to giving financial-technology firms the ability to offer more banking services nationwide
By Rachel Witkowski – WSJ
/goo.gl/81GXhB

Darktrace valued at $825m as fintech firm Revolut secures new funding
James Titcomb – Telegraph
Two British technology start-ups have raised $141m between them in the ­latest evidence that the appetite for fast-growing companies in the UK ­remains robust.
/goo.gl/KpDPrx

Tech firms protest proposed changes to U.S. net neutrality rules
Angela Moon and David Shepardson – Reuters
Facebook Inc (FB.O), Twitter Inc (TWTR.N), Alphabet Inc (GOOGL.O) and dozens of other major technology companies protested online on Wednesday against proposed changes to U.S. net neutrality rules that prohibit broadband providers from giving or selling access to certain internet services over others.
/goo.gl/FdWUsZ

Bitcoin just got a vote of confidence from Switzerland’s legendary banking system; Falcon Private Bank said Wednesday it received approval from a Swiss regulator to offer bitcoin products.; This is the first time the Swiss regulator has done so.; The decision could pave the way for other global regulators to approve bitcoin products.
Evelyn Cheng – CNBC
Switzerland’s financial markets regulator has approved the first Swiss private bank for bitcoin asset management, potentially paving the way for other global banks to offer digital currency products.
/goo.gl/Wtxcvo

Hyperledger Releases Its First Production Ready Blockchain
By REUTERS via NY Times
The Hyperledger Project, a group led by the Linux Foundation, has released its first blockchain code that can be used by large businesses to build software.
/goo.gl/SJuhx1

Politics

Trump’s FDIC nominee Clinger withdraws from consideration
By ZACHARY WARMBRODT – Politico
Jim Clinger asked the White House to withdraw his nomination to become chairman of the Federal Deposit Insurance Corp., the latest setback in the administration’s efforts to fill key financial posts. Clinger cited family issues.
/goo.gl/TvqTCQ

Blumenthal asks antitrust pick to discuss White House role in AT&T deal
Reuters
Senator Richard Blumenthal, a member of the Judiciary Committee, said on Wednesday that he asked President Donald Trump’s top antitrust pick to meet to discuss any contact he has had with the White House regarding AT&T’s (T.N) plan to merge with Time Warner (TWX.N).
/goo.gl/giAUYW

Massive copper mine tests Trump’s push to slash regulation
Emily Flitter – Reuters
Rio Tinto’s proposed Resolution Copper Mine in Arizona would tunnel 7,000 feet underground, where rocks radiate heat from the earth’s molten core. It would suck up enough water to supply a city and leave a crater a mile and a half wide and 1,000 feet deep.
/goo.gl/V5bga5

Regulation

Finra Launches U.S. Treasury Transaction Reporting
Katy Burne – The Wall Street Journal
U.S. Treasury bond traders started reporting their transactions for the first time this week, fulfilling a longtime goal of regulators for daily visibility into the $14 trillion market that influences securities prices across the globe.
/goo.gl/fL8N1X

Remarks at the Economic Club of New York
SEC Chairman Jay Clayton
It is an ideal place to discuss policy of the U.S. Securities and Exchange Commission (“SEC” or “the Commission” or “the agency”) and its effects on the U.S. economy and the American people. I intend to do just that in this, my first public speech as Chairman of the SEC.[1]
/goo.gl/FPxABL

SEC Chairman signals plans to scale back corporate disclosure rules
Sarah N. Lynch – Reuters
Wall Street’s top U.S. regulator on Wednesday signaled support for potentially scaling back the scope and breadth of disclosure rules and compliance costs imposed on public companies, in an effort to entice more companies to go public.
/goo.gl/YoKPxj

RBS to pay $5.5 billion to resolve major U.S. mortgage probe
Andrew MacAskill and Jonathan Stempel – Reuters
Royal Bank of Scotland (RBS.L) will pay $5.5 billion to settle one of the two major U.S. investigations into allegations it mis-sold mortgage-backed bonds that it needs to resolve before the British government can sell its shares.
/goo.gl/a3XVTi

Second ex-State Street executive admits guilt in U.S. fraud case
Nate Raymond – Reuters
A former State Street Corp executive on Wednesday became the second person to plead guilty to participating in what U.S. prosecutors say was a scheme to defraud six clients through secret commissions on billions of dollars of trades.
/goo.gl/h9TAz6

U.S. appeals court blocks release of HSBC money laundering report
Jonathan Stempel – Reuters
A U.S. appeals court on Wednesday blocked the release of a report discussing HSBC Holdings Plc’s (HSBA.L) progress in improving its controls against money laundering, reversing a judge’s order that the report be made public.
/goo.gl/A3XWH2

HFT warns of Mifid II risk to exchange trading; Optiver cautions European Commission against overlooking the ‘real problem’ of the systematic internaliser regime
By Samuel Agini – Financial News
One of the world’s biggest high-speed trading firms has raised concerns that an important part of the EU’s new securities rulebook risks undermining efforts to push more share trading onto exchanges.
/goo.gl/YTSYP7

Sebi expresses concern over high derivatives-to-cash turnover; Sebi issued a discussion paper on ‘Growth and development of the equity derivatives market in India’
Business Standard
The Securities and Exchange Board of India (Sebi) has expressed concern over high equity derivatives turnover vis-à-vis cash turnover.
/goo.gl/VCuJC5

After Sebi crackdown on P-notes, most hedge funds may take FPI route; Some might find this unviable and opt out; impact clearer in some weeks
Ashley Coutinho – Business Standard
A majority of hedge funds which came in through the participatory notes (p-notes) route are preparing to register themselves directly as foreign portfolio investors (FPIs). Last week, the Securities and Exchange Board of India (Sebi) had issued a circular banning p-note holders from taking naked exposure to the derivatives market. It said all existing positions would have to be squared off by the end of 2020 or date of maturity of the instrument, whichever was earlier. On Monday, FPIs requested Sebi for a three-month extension to roll over their July positions. Sebi ..
/goo.gl/ybtWh2

ESMA issues sector-specific principles on relocations from the UK to the EU27
ESMA
The European Securities and Markets Authority (ESMA) has published three Opinions setting out sector-specific principles in the areas of investment firms, investment management and secondary markets, aimed at fostering consistency in authorisation, supervision and enforcement related to the relocation of entities, activities and functions from the United Kingdom.
/goo.gl/KsuXYc

Second ex-State Street executive admits guilt in U.S. fraud case
By Nate Raymond – Reuters
A former State Street Corp executive on Wednesday became the second person to plead guilty to participating in what U.S. prosecutors say was a scheme to defraud six clients through secret commissions on billions of dollars of trades.
/goo.gl/3sciHi

Tighter rules unlikely to stem flow of dark trading to SIs; SIs under MiFID II will still be very attractive trading venues for investors even if EU stamps down on networking attempts.
By John Bakie – The Trade
Updated rules for the systematic internaliser (SI) regime are unlikely to prevent the venues from becoming major dark trading venues, according to Michael Horan, head of trading services at BNY Mellon Pershing.
/goo.gl/4RGJfj

Investing and Trading

Investors Don’t Hate Fund Managers, Just U.S. Stock-Pickers
Charles Stein – Bloomberg
Investors haven’t soured on all active fund managers — only those who pick U.S. stocks.
Actively managed mutual funds and exchange-traded funds that own domestic stocks experienced $98.5 billion in net redemptions in the first six months of 2017, according to the latest figures compiled by Morningstar Inc. Active funds that buy international stocks attracted inflows of $8.7 billion and active funds that buy bonds gathered $106.5 billion.
/goo.gl/gT4Mau

Warrington Wins Pinnacle Award
Warrington Asset Management
Warrington Asset Management’s Strategic Program won the 2017 Pinnacle Award’s 5-Year Best Options Strategy. For six years, the Pinnacle Awards have recognized excellence in trading in the managed futures space. Warrington has been nominated four times, and brought home the coveted award this year.
jlne.ws/2tNaIP3

Why the Euro’s Surge Could Last; As the risk of a eurozone breakup fades, indicators suggest investors are increasingly positive about the currency’s prospects
By Mike Bird – WSJ
Once dubbed a crisis currency, the euro has outperformed its peers against the dollar and investors are betting there are gains to come.
/goo.gl/VS2SRX

Why butter prices are at a record high; A supply shortage combined with rising demand has sent wholesale prices to a record high
Emiko Terazono – FT
Europe is in the throes of a butter shortage.
/goo.gl/fN1DVA

Rooftop Solar Is No Match for Crony Capitalism; Utilities want onerous fees on power generated from the sun. Environmentalists and economists should be dismayed.
By Noah Smith – Bloomberg
The New York Times ran an article over the weekend about efforts by utility companies to fight the spread of rooftop-solar power:
/goo.gl/WD7gnB

Paul Singer Made $57.6 Million in One Day on This Bet
By Tina Davis – Bloomberg
NRG Energy Inc. rose the most in almost nine years on news that it will sell off as much as $4 billion in assets, including potentially all of its renewable energy business. The company has been under pressure from Elliott Management Corp., its fourth-largest shareholder, to cut costs. The share climb Wednesday increases the value of Elliott’s stake in NRG to about $352 million, for a gain of $57.6 million in a day.
/goo.gl/NN1F9z

Bank of Canada Raises Rates for First Time in 7 Years
By Theophilos Argitis – Bloomberg
Canada cautiously became the first Group of Seven country to join the U.S. in raising interest rates on Wednesday, feeding speculation the world’s central bankers are entering a tightening cycle.
/goo.gl/nmxZiZ

Sign of the Bottom? New ETFs Will Bet Against Beaten-Down Retail Stocks; Planned ETFs to bet against brick-and-mortar retailers could prove a contrarian signal
By Chris Dieterich – WSJ
New ETFs are in the works to allow traders to profit from the struggles of brick-and-mortar retailers.
/goo.gl/wm12ms

Investors Don’t Hate Fund Managers, Just U.S. Stock-Pickers
By Charles Stein – Bloomberg
Active international equity funds and bond funds get cash; Latest trends boost indexing giants BlackRock, Vanguard
Investors haven’t soured on all active fund managers — only those who pick U.S. stocks.
/goo.gl/gT4Mau

Black Swans, Wolves at the Door: the Rise of Activist Investors
By Manuel Baigorri and Nishant Kumar – Bloomberg
Activism is growing across Europe, Alvarez & Marsal says; Its research suggests U.K.-based firms are the most at risk
U.K. companies are more likely to be targeted by activist investors than those in Germany, France, Scandinavia and Switzerland, according to Alvarez & Marsal Inc.
/goo.gl/nU6vAw

Institutions

Global Asset Management 2017 – The Innovator’s Advantage
The Boston Consulting Group
The growing challenges confronting asset management were confirmed by the industry’s global performance in 2016. For the first time since the 2008 financial crisis, the revenue pool of traditional managers fell worldwide, along with their profits. Margins contracted as fee pressures continued to increase.
/goo.gl/mPQyqP

****SD: Link is to a full PDF of the report.

Fund Management’s Future? Milking Cows
Mark Gilbert – Bloomberg
To see the future of fund management, look at the the auto industry.
Large-scale producers (the equivalent of Ford Motor Co. or Volkswagen AG) will dominate the landscape, driving inefficient players out of business or absorbing them. Niche players (Ferrari NV, arguably Tesla Inc.) will charge more for specialist products, sometimes in alliance with the bigger players. Those in the middle face extinction.
/goo.gl/y9kWyc

JPMorgan hires new head of global government relations
Reuters
JPMorgan Chase & Co (JPM.N) has hired a former chief of staff to majority leaders of the U.S. House of Representatives as its new head of global government relations, according to an internal memo the bank provided on Wednesday.
/goo.gl/We2vCk

Victory for HSBC: US court says assessment of bank’s anti-laundering efforts must be kept secret
Reuters via SCMP
A US appeals court on Wednesday blocked the release of a report discussing HSBC Holdings Plc’s progress in improving its controls against money laundering, reversing a judge’s order that the report be made public.
/goo.gl/v7UXtm

JPMorgan launched a new tool to help fill 7,500 finance jobs in New York City
Frank Chaparro – Business insider
Thousands of finance jobs are available in New York City, and JPMorgan is trying to fill them with a new search tool.
/goo.gl/ttnyid

Salgado Fights for Family Honor as Espirito Santo Case Drags On
By Anabela Reis – Bloomberg
Portugal’s central bank fined ex-CEO, who denies wrongdoing; Lone Star was picked to buy parts of the Espirito Santo bank
Three years after the bailout of the near-century-old Portuguese lender Banco Espirito Santo SA, the man who led it for over two decades is writing a memoir and rejecting blame for the rescue of his family-controlled bank.
/goo.gl/YK8Vjt

Credit Suisse global head of equities departs; Mike Paliotta, who led the global equities business at the Swiss bank since 2016, has been replaced by Mike Stewart.
By Joe Parsons – The Trade
Credit Suisse has parted ways with its global head of equities, Mike Paliotta, according to a memo seen by The TRADE.
/goo.gl/4jmUj1

Regions

As Qatar row smolders, world markets tot up dependence on Gulf petrodollars
Sujata Rao – Reuters
Qatar’s tensions with its neighbors are making world markets edgy about any hint of financial instability among the Gulf economies, whose vast store of petrodollar savings permeate global investments.
/goo.gl/ibQ8gY

Japan’s foreign bond buying influenced by currency swings; Political risk leaves Italy an outlier when most European fixed income are in favour
Dan McCrum and Kate Allen – FT
To a Japanese bond investor, the world truly is flat. Not only in the sense that they can invest around the world at the click of a button, but that the choices available to them have become extremely compressed.
/goo.gl/e5Agwg

China’s Booming Housing Market Proves Impossible to Tame; Beijing’s efforts to curb speculation have only made buyers more determined; many believe the government won’t allow a market collapse
By Lingling Wei and Dominique Fong – WSJ
The more China tries to rein in its roaring housing market, the more obsessed people get about buying.
/goo.gl/7i76CR

The illusion of trading the UK-US yield gap
FT
The gap between the UK and US 10-year government bond yield has been widening significantly since last year’s Brexit vote. However, the FT’s Miles Johnson argues that anyone betting against gilts should be cautious.
/goo.gl/fdXDJ6

China financial ‘windstorm’ eases as central bank injects cash; Fierce deleveraging campaign moderates after months of financial stress
Gabriel Wildau in Shanghai – FT
China’s central bank injected $53bn into the banking system on Thursday, the latest sign that policymakers have eased up on a fierce deleveraging campaign that has caused turmoil among lenders in recent months.
/goo.gl/FfMPwf

Brexit

Brexit and Trump have forced the EU to listen to its critics and change, admit its top officials
Joe Watts – The Independent
Donald Trump and Theresa May at last weekend’s G20 summit in Hamburg Getty
The shock of Brexit and Donald Trump’s rise is forcing Europe to tackle the deep problems that drove Britons to vote Leave, the EU’s most senior officials have admitted.
/goo.gl/VxoqKc

Firms are ‘bored of Brexit’ and continuing to hire, Robert Walters says
Rhiannon Bury – Telegraph
Companies have become “bored” with the Brexit negotiations and are hiring staff as normal, the chief executive of recruitment firm Robert Walters has said.
/goo.gl/x4Z1dp

Brexit’s Repeal Bill, No Longer ‘Great’ But Vital: QuickTake Q&A; By Thomas Penny and Charlotte Ryan – Bloomberg
The Repeal Bill being introduced by U.K. Prime Minister Theresa May this week — downgraded from the “Great” Repeal Bill — will be seen as a milestone in Britain’s ongoing departure from the European Union. But with reports that lawmakers from across Parliament plan to oppose the bill, it certainly won’t be as straightforward as the prime minister imagined when she announced it in October last year. Even if lawmakers don’t block its passage into law, many months of work — and no shortage of additional legislating — are still ahead before Brexit is a reality.
/goo.gl/tdwhxC

Miscellaneous

The Wall Street Journal Reorganizes Newsroom, Creates Senior Roles; Efforts center on digital, mobile initiatives; Editor in Chief Gerard Baker says newsroom’s head count to remain ‘roughly stable’
By Lukas I. Alpert – WSJ
The Wall Street Journal on Wednesday announced details of a broad editorial reorganization as part of its “WSJ2020” review, creating a new leadership structure with the aim of transforming the 128-year-old newspaper into a mobile-first news operation.
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Bergstrom is chief information officer of John J. Lothian & Co. He edits MarketsWiki and JLN Options.