Breaking News

Regulators plan eleventh-hour change to Mifid share-trading rules; China to Give Foreigners Greater Access to Its Financial Sector

First Read

LaSalle Street Trading Tech Awards Event Reaches New Heights
By John J. Lothian

The LaSalle Street Trading Tech Awards event was a success last night with over 130 people in attendance to see six scouts honored with the Harlan Ten Pas Award and seven firms honored for participating in the Trading Tech 300 program in the last year.

It was a successful networking event as people mixed and share stories of Scouting and the industry and talked about how to move the Trading Tech 300 program to the next level.

With interest in the program from outside the financial industry, Trading Tech 300 is looking to expand into Med Tech, Law Tech, Construction Tech and Civics Tech, among potential fields.

My goal, which I expressed again at the event, is to make Chicago the STEM capital of the world, AGAIN! Chicago was the STEM capital of the world back in 1893 when the World’s Fair in Chicago introduced electricity and the Ferris Wheel to the world, among other things. Someone even mentioned how this mighty goal might be a great way to help attract Amazon’s new headquarters to Chicago.

We are making Chicago the STEM capital of the world one Scout at a time through merit badge workshops focused on STEM in our industry, and now beyond.

During EXPO I secured oral agreements from Nasdaq, ICE/NYSE and Fidessa to hold workshops in New York. Anyone else interested?

The event last night raised $157,000, exceeding the goal of $150K. We are thankful to our sponsors and supporters who contributed to this success. The list includes: ABN AMRO Clearing Chicago, Advantage Futures LLC, Chicago Board Options Exchange, CME Group Inc, Continental Materials Corp, Eurex US, FGMK, LLC, FourStar Wealth Advisors, Mike Dawley, HTG Capital Partners, LLC, Merrill Lynch, Global Wealth & Investment Management, NEX Markets-BrokerTec, OCC, RJ O’Brien, RSM US LLC, Simon Compliance, The Clearing Corporation Charitable Foundation, The Rich Foundation, Thorndyke Sheppard Group, Merrill Lynch, Pierce, Fenner & Smith, Inc., Valuation Research Corporation, Wintrust Wealth Management, Woodfield Fund Administration and XR Trading LLC

Thank you to all who attended the event and who contributed to its past and future success. Last, thank you to Myriam Herrera and the professionals from Pathway to Adventure Council for all their hard work on Trading Tech 300 and this renewed event.

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Hits & Takes
By JLN Staff

On November 14, 2017, NYSE Arca Options will activate the previously announced expansion to Market Maker Self-Trade Prevention (“STP”) functionality. Expanded STP will allow MMs to prevent inbound quotes and orders from executing against opposite-side, resting MM interest.~JJL

Two CME Group disciplinary actions pertaining to spoofing hit the wire yesterday – one concerning cattle futures and one pertaining to E-Mini S&Ps. The stories are also in our “Regulation” section. The end of last week saw a number of wash trade and terminal misuse disciplinary notices. You can see the exchange group’s whole disciplinary docket here. ~SD

We have released another of our FIA Expo videos (see below). This is the first of two to cover cryptocurrencies and distributed ledger technology. The videos we’ve released thus far are: The Industry Discusses the Big Data Boom Part I and Part II and The Industry Discusses MiFID II Part I and Part II. ~SD

Women In Listed Derivatives, aka WILD, is having their annual symposium on Women and Personal Investing on Tuesday, Nov. 14 starting at 4:00 pm in the CME Auditorium, 20 South Wacker Drive, Chicago, IL. It is $45 for WILD members and $95 for non members, which includes a membership. Keynote speaker and panel discussion will be from 4:00 p.m. to 6:00 p.m. followed by a networking reception from 6:00 p.m. to 8:00 p.m.
Moderator: Carolyn Leonard, CEO and Co-Founder of Dymynd
Panelists: Patricia DeChant, Vice President at CIBC Atlantic Trust Private Wealth Management; Mary DiChristafano, Graystone Consulting/Morgan Stanley Private Wealth Management; Julie Shechtman, Senior Vice President at Morgan Stanley Wealth Management; Khloé Karova, Owner of Modern Capital Concepts, an independent Registered Investment Advisor. ~SR

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The Industry Discusses Cryptocurrencies and DLT

JohnLothianNews.com

At the 33rd Annual FIA Futures and Options Expo in mid-October, John Lothian News spoke with a variety of industry participants about upcoming milestones and trends in financial markets.

This fifth video in the series is the first to cover the crazily popular cryptocurrency space and its technological underpinnings. In part one, Ed Tilly, chairman and CEO of Cboe, Drew Shields, Trading Technologies’ CTO, Thomas Flake, the co-founder and chief marketing officer of bcause, Kevin Darby, managing partner at Blue Trading Systems and Chris Hehmeyer, CEO of Hehmeyer Trading + Investments share their thoughts on the future of the crypto space.

Watch the video and read the rest here »

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The Internet Of Tomatoes Is Coming, Starting With Boston Salads
Bloomberg
Intrigued by how blockchain was changing finance, an ex-banker at Wells Fargo & Co. and a former executive at Nasdaq Inc. began looking for other opportunities. They looked at applying the technology to insurance, law, even music. Then they hit on farming.
/goo.gl/BC8dkw

**I’ll have a salad with some block-choy.~JK

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Remembering the Golden Age of Open-Outcry Markets; I worked on the Chicago Board of Trade floor. I couldn’t imagine doing anything else.
Lawrence Schneider – WSJ
I empathize with David Tung Wai’s sadness for watching the demise of the Hong Kong stock exchange trading floor (“At 87, a Stogie-Toting Legend Mourns the End of Trading Floors,” page one, Oct. 26). My first visits to the Chicago Mercantile Exchange began in 1956, when I would go downtown to visit my father and grandfather who traded for themselves, speculators and their butter, egg and onion hedging clients.
/goo.gl/omxDAn

**One of the few people who actually remembers when onion futures were traded, but then came the Onion Futures Act

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What Is Wealth?
The New York Times
Wealth is about community, good health and service to others for Rachel Talton. Ms. Talton, 52, is founder of the Flourish Conference for Women in Leadership, and chief executive of Synergy Marketing Strategy & Research in Akron, Ohio.
/goo.gl/7F6Fgr

**An interesting cross-section of ideas about the topic. I’m now a fan of Nedim Ramic.~JK

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Thursday’s Top Three
Our top read stories of the day were led by The Wall Street Journal’s story on a new analytics tool from Nasdaq, Wall Street Fears Nasdaq Proposal Would Expose Trading Secrets. Second went to our reference to the CME’s data services page at
Have you seen the CME Datamine?. Third went to
Bloomberg’s piece about the future for retailers in America’s ‘Retail Apocalypse’ Is Really Just Beginning

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MarketsWiki Page of the Day: Jos Dijsselhof
MarketsWiki
Former Euronext COO Jos Dijsselhof has been appointed as the new CEO of the Swiss exchange group SIX. Dijsselhof will take over SIX on January 1, 2018, replacing Urs Rüegsegger, who announced in May he would retire.
/goo.gl/vAdksU

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Sponsored Content

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Lead Stories

Regulators plan eleventh-hour change to Mifid share-trading rules
Philip Stafford- Financial Times
Just 54 days before the biggest shake-up in European markets legislation for a decade, regulators are preparing to change share-trading rules that they fear could result in more business being diverted away from public stock exchanges.
/goo.gl/VxAExV

China to Give Foreigners Greater Access to Its Financial Sector
Chao Deng and Eva Dou – WSJ
China took a major step in opening up its financial sector, announcing a relaxation of restrictions on foreign ownership in the securities and banking sectors just hours after U.S. President Donald Trump concluded his visit to Beijing.
/goo.gl/MqZrhp

Norway’s Wealth Fund Says FX Market Needs to Change
Mikael Holter – Bloomberg
Norway’s $1 trillion sovereign wealth fund is advocating for change in the way currency markets function to ensure both sides of trades have equal access to the information they need.
/goo.gl/4Frpxd

The Municipal Bond Trader Working the Phone Is Now a Dying Breed
Danielle Moran – Bloomberg
Electronic networks account for majority of dealer trading; Regulator says data provides first look at role of ATSs
Even on staid municipal bond desks, the days of traders working the phones are rapidly fading.
Electronic-trading platforms, known as ATSs, for securities firms and big investors account for 59 percent of all state and local debt trades between dealers, according to data released by the Municipal Securities Rulemaking Board. Dealers can choose to trade one of three ways — through ATS, broker’s brokers or directly with each other.
/goo.gl/Nr1dHV

Bitcoin: The World’s Most Dramatic Bubble Ever?; Investment manias throughout the centuries have ranged from tulips to tech stocks to housing; is bitcoin different?
Steven Russolillo – WSJ
First it was tulips. More recently it was tech stocks and then the housing market. Lately, it’s all about bitcoin.
/goo.gl/s4VdKf

SIX names new CEO and reorganises securities services; Former Euronext COO Jos Dijsselhof will take over SIX from the beginning of next year.
Joe Parsons – The Trade
Swiss exchange group SIX has restructured its securities and post-trade business, and has appointed former Euronext COO Jos Dijsselhof as its new CEO.
/goo.gl/YHva6s

EU watchdog sides with exchanges over new trading rules
Huw Jones – Reuters
The European Union’s markets watchdog has proposed a tightening in share trading rules within the bloc’s MiFID II reform, marking a victory for exchanges at the expense of big banks only weeks before the new rules come into force.
/goo.gl/KJPXd8

Madoff victims get ready for payday; Feds start returning ill-gotten gains; investors stand to recover 75% of losses
Aaron Elstein – Crain’s NY
More than eight years after Bernie Madoff pleaded guilty to orchestrating his epic Ponzi scheme, the U.S. Department of Justice today began distributing $772.5 million in recovered funds to the fraud’s 24,000 victims.
/goo.gl/voPEUS

TCI presses LSE to hold vote on removing chairman; Hohn calls meeting to oust Brydon and extend Rolet’s contract as chief executive
Philip Stafford – FT
The Children’s Investment Fund, the activist shareholder, has requisitioned an extraordinary meeting of London Stock Exchange Group shareholders to demand the removal of chairman Donald Brydon and extend Xavier Rolet’s contract as chief executive.
/goo.gl/5iFye2

TCI requisitions shareholder meeting to remove London Stock Exchange chairman
Philip Stafford – FT
The Children’s Investment Fund, the activist shareholder, has requisitioned an extraordinary meeting of London Stock Exchange Group shareholders to try to remove its chairman and extend the contract of Xavier Rolet, its chief executive, until 2021.
/goo.gl/gdgAuQ

Activist TCI calls for shareholder vote on removing LSE chairman
Reuters
Activist investor TCI Fund Management called on Thursday for a shareholder meeting to vote on removing London Stock Exchange Chairman Donald Brydon, saying the company had not explained why Chief Executive Xavier Rolet was leaving.
jlne.ws/2ho5Dei

FCM Rankings & Concentration: Q3 2017
Tod Skarecky – Clarus Financial Technology
The latest batch of FCM data has been assembled. Lets dig in.
jlne.ws/2AodKLy

Norway sovereign wealth fund wants forex traders to restore trust; Series of currency scandals prompt call for applying clearer practices for customers
Philip Stafford – FT
The world’s biggest sovereign wealth fund has urged banks to do more to restore investors’ confidence in the global foreign exchange market after a series of scandals.
/goo.gl/LFwx87

On the Ground at FIA Expo: An Industry Coming to Grips With Change
Tom Lehrkinder – TABB Group
There was a great deal of focus on education at the 2017 FIA Expo in Chicago, as the industry pivots to meet the needs of a new generation of investors amid the rise of next-generation technologies. The Cubs may have lost, but the futures industry is learning how to win.
/goo.gl/mn96ZV

Exchanges, OTC and Clearing

CME Pivot Partners with Thomson Reuters
CME Group
CME Pivot and Thomson Reuters Eikon Messenger are partnered to provide a federated chat network.This partnership offers open connectivity between both platforms, providing a seamless experience for all users. With AIM’s third-party vendor decommission on December 1, CME Pivot is an ideal solution that offers greater access to market participants over a secure, fast network.
jlne.ws/2hnWthZ

TP ICAP faces network outage at voice broking unit
Philip Stafford – FT
TP ICAP, the world’s largest interdealer broker, has suffered a big network outage in one of its voice broking businesses.
/goo.gl/aZg6B3

TP Icap struggles to get systems back up and running after being hit by network outage
Oliver Gill – City AM
TP Icap, the world’s largest interdealer broker, is grappling to get its systems back up and running after being hit by a massive network outage.
/goo.gl/yNHdkT

Seven FX Market Participants Agree To Clear CME OTC Non-Deliverable Forwards – Increased Competition Leads To Innovation And Cost Efficiency For Customers In The OTC FX Space
Mondovisione
CME Group, the world’s leading and most diverse derivatives marketplace, today announced that seven market participants have agreed that they intend to clear OTC FX Non-Deliverable Forwards (NDFs) by the end of Q1 2018.
/goo.gl/vKoHbN

Futures Trading Isn’t Just for Big Players, CME Group Says; Small investors can use them for after-hours trades.
TheStreet Staff
Futures Trading Isn’t Just for Big Players, CME Group Says
Futures trading isn’t just for big institutions, but also for average investors who want access to markets virtually around the clock, a top CME Group official says.
/goo.gl/S3dSey

Redesign of the Order-to-Trade Ratio (OTR) in the context of MiFID II
Eurex
As of January 2018, the Order-to-Trade Ratio (OTR) concept in place at Eurex Deutschland and Eurex Zürich AG (collectively: the Eurex Exchanges) will be redesigned. The following changes are planned:
/goo.gl/w3VDJB

TMX Group Limited Declares Dividend of $0.50 per Common Share
TMX
The Board of Directors of TMX Group Limited declared a dividend of $0.50 on each common share outstanding, payable on December 8, 2017 to shareholders of record at the close of business on November 24, 2017.
/goo.gl/bEx2Yg

Fintech

Making the Market: Building Prices in Fixed Income
Vela
The fixed income markets are going through a period of significant transition, as both economic factors and regulatory reforms force more and more trading into the electronic domain and new liquidity venues proliferate. This changing landscape is presenting both new challenges and new opportunities in a variety of areas.
/goo.gl/2dZwkz

Bitcoin’s Exorbitant Energy Costs May Prove to Be Biggest Risk
Sid Verma – Bloomberg
It may not matter whether bitcoin’s a bubble. The staggering energy costs associated with “mining” the digital currency could prove to be its downfall.
Even as bitcoin flirts with $8,000, the price required for mining to be marginally profitable stands at a jaw-dropping $300,000 to $1.5 million by 2022 based on current growth trends and electricity use, according to Christopher Chapman, an analyst at Citigroup Inc. At that pace, the implied consumption would match that for the whole of Japan over the long haul.
jlne.ws/2hpA03Q

China Fintech IPO Fever Wanes as Regulators Weigh Crackdown
Crystal Tse and Alfred Liu – Bloomberg
Regulators review interest rates charged by cash microlenders; The euphoria around Chinese fintech listings is starting to wane.
Online lender PPDAI Group Inc. raised $221 million after pricing its U.S. initial public offering below the bottom end of a marketed range, people with knowledge of the matter said Friday. Rival Qudian Inc. fell below its offer price the week after its October debut in New York, then bounced back, only to see its stock drop 7.4 percent over the past two days.
/goo.gl/aJCcmT

Politics

Gary Cohn Tacitly Reveals That He Slept Through Years Of Goldman Sachs Media Training
Thornton McEnery – Dealbreaker
It appears that Gary Cohn might have grown over-comfortable being the smartest man in the room at any given moment in the Trump White House.
The Big Grundle sat down with CNBC’s John Harwood to talk over the tax reform plan he fashioned for Trump. He then proceeded to say a litany of things that made us wonder if Gary ever received any media training at Goldman Sachs whatsoever. In the space of 20-odd minutes, Gary spoke with such extemporaneous frankness on economic issues surrounding the tax plan that it began to seem like he forgot he worked in the White House.
jlne.ws/2horfHl

Mueller Probes Flynn’s Role in Alleged Plan to Deliver Cleric to Turkey
James V. Grimaldi, Shane Harris and Aruna Viswanatha – WSJ
Special Counsel Robert Mueller is investigating an alleged plan involving former White House National Security Adviser Mike Flynn to forcibly remove a Muslim cleric living in the U.S. and deliver him to Turkey in return for millions of dollars, according to people familiar with the investigation.
/goo.gl/NkdztJ

Regulation

Guide to Mifid II implementation
FT Advisor
Directive 2014/65/EU doesn’t sound very catchy but this is the official designation of the Markets in Financial Instruments Directive II legislation which is coming into force in just a few weeks’ time.
jlne.ws/2hoot4X

NEX Regulatory Reporting will apply to become an SFTR trade repository
NEX Group
NEX Regulatory Reporting announces today its intention to apply to become a trade repository for the Securities Financing Transactions Regulation (SFTR) and launch a dedicated reporting solution, pending the issuance of the final technical standards from ESMA.
/goo.gl/rY6bJZ

CME-Jiongsheng-Zhao-Notice of Disciplinary Action
CME Group
Pursuant to an offer of settlement in which Jiongsheng (Jim) Zhao (“Zhao”) neither admitted nor denied the rule violation upon which the penalty is based, on November 7, 2017, a Panel of the Chicago Mercantile Exchange (“CME”) Business Conduct Committee (“Panel”) found that on one or more occasions between September 14, 2015, and March 23, 2016, Zhao engaged in certain activity in which he entered and cancelled large orders in the December 2015, March 2016, and June 2016 E-Mini S&P 500 futures contracts on the Globex electronic trading platform without the intent to trade.
jlne.ws/2ho7PCr

CME-George-Keefe-III-Notice of Disciplinary Action
CME Group
Pursuant to an offer of settlement in which George Keefe III neither admitted nor denied the rule violation upon which the penalty is based, on November 7, 2017, a Panel of the Chicago Mercantile Exchange Business Conduct Committee found that on several occasions between June 2015, and March 2016, Keefe engaged in certain activity in which he entered and canceled layered orders in the Live Cattle futures contract market without the intent to trade.
jlne.ws/2hnRAW0

The Morning Ledger: SEC May Give New Cyberbreach Disclosure Guidelines
Tatyana Shumsky – WSJ
Good morning. U.S. Securities and Exchange Commission’s Director of Corporation Finance William Hinman said Thursday that public companies will soon face new guidelines for how they report cybersecurity breaches to investors, writes CFO Journal’s Ezequiel Minaya.
/goo.gl/hEJyZK

ESMA updates its Q&As on MiFID II/MiFIR Investor Protection topics
ESMA
The European Securities and Markets Authority (ESMA) has added 4 new Q&As to its Questions and Answers (Q&A) document on the implementation of investor protection topics under the Market in Financial Instruments Directive and Regulation (MiFID II/ MiFIR). The new Q&As cover the topics of post-sale reporting, record keeping, and inducements.
/goo.gl/FSQvuD

FINRA Hearing Panel Bars Broker for Defrauding Elderly, Blind Customer
FINRA
The Financial Industry Regulatory Authority (FINRA) announced today that a FINRA extended hearing panel barred broker Hank Mark Werner of Northport, New York, for fraudulently churning and excessively trading the accounts of his customer – a blind, elderly widow – and for making unsuitable recommendations. The hearing panel also ordered Werner to pay more than $155,000 in restitution to the widow, fined him $80,000 and ordered disgorgement of more than $10,000 representing commissions received for recommending the purchase of an unsuitable variable annuity. The decision resolves charges brought by FINRA’s Department of Enforcement in August 2016.
/goo.gl/4a4gSH

This Veteran’s Day, Let’s Recognize How Vets Fare Financially
PETE CHANDLER – FINRA
Each November 11, we recognize the many accomplishments and sacrifices made by our 22 million U.S. military veterans. We pay tribute to their bravery and service to our country, and hear many personal stories of what it means to be a veteran in America today.
/goo.gl/mUatfH

SIFMA Statement on Completion of Quantum Dawn IV Cybersecurity Exercise
SFIMA
SIFMA today released the following statement from Kenneth E. Bentsen, Jr., SIFMA president and CEO, upon completion of SIFMA’s November 7-8 industry-wide Quantum Dawn IV cybersecurity exercise. Over 900 participants from over 50 financial institutions, government agencies and regulators participated in this simulation of a large-scale cyberattack on the financial markets. A fact sheet with details on Quantum Dawn IV is available here.
/goo.gl/Jn1y3H

Capita Financial Managers to pay up to £66 million for the benefit of investors in the Connaught Income Fund, Series 1
UK FCA
The Financial Conduct Authority has today announced that Capita Financial Managers Limited (CFM) has been publicly censured and will pay up to £66 million to those investors who suffered loss as a result of investing in the Guaranteed Low Risk Income Fund, Series 1 (or as it became later known, the Connaught Income Fund, Series 1) (“the Fund”), which is now in liquidation. The payment will be made via the FCA.
/goo.gl/uGuDL3

SEC Announces the Formation and First Members of Fixed Income Market Structure Advisory Committee
SEC
The Securities and Exchange Commission today announced the formation and first members of its Fixed Income Market Structure Advisory Committee.
/goo.gl/p42s5H

Investing and Trading

U.S. Tax Concerns Ripple Through Global Markets; Tax reform proposed by Senate Republicans differs from the House plan, raising worries on prospects for a bill
Marina Force – WSJ
European stocks edged down Friday, following Asian markets and Wall Street lower on concerns over the U.S. tax-overhaul plan.
/goo.gl/YDL5MR

Noble shares slide 7% after reporting $3bn loss
Edward White – FT
Shares in Noble Group slid in early trading on Friday after the company posted a $3.05bn net loss in the first nine months of 2017 a day earlier.
/goo.gl/LWDgZf

Investors shun active US equity funds; Outflows hit more than $150bn for the year despite improved performance
Robin Wigglesworth in New York – FT
Money is flowing out of active equity funds despite the improving performance of traditional investment managers, with another $4.5bn seeping out of US funds over the past week to take the cumulative outflow to more than $150bn this year.
/goo.gl/dvQj1a

‘Offshore magic circle’ law firms fear Paradise Papers fallout; Rivals to data-leak group Appleby fret over security but hope to mop up clients
Madison Marriage and Barney Thompson – FT
Fear and suspicion have swept through the “offshore magic circle” law firms that advise wealthy individuals and large multinationals on how to minimise their tax bills, following the leak of the Paradise Papers.
/goo.gl/zqxz1R

BlackRock’s Larry Fink Sees as Much as $5 Trillion Moving to Passive
By Simone Foxman – Bloomberg
BlackRock Inc. Chief Executive Officer Laurence Fink predicted that new regulations including MiFID II in Europe and the fiduciary rule in the U.S. could push $2 trillion to $5 trillion in assets into passive investments.
/goo.gl/TUdUZ7

Major Stock Selloffs Just Aren’t What They Used to Be
Luke Kawa – Bloomberg
Volatility is back — at least by this year’s standards. The 0.8 percent retreat in the S&P 500 Index just after noon in New York is what passes for a two-sigma drop in the benchmark gauge.
/goo.gl/YJ8VzZ

Bitcoin Is No Bubble, Says Investor With $213 Million Stake
Edward Robinson – Bloomberg
VC Tim Draper bought 30,000 coins in 2014, at about $600 each; Draper says cryptocurrency ‘transformation’ is here to stay
Tim Draper was walking through a pavilion at a tech conference in Lisbon on Tuesday when he was cornered by an entrepreneur touting a new digital currency. No sooner had the venture capitalist heard the pitch than he was approached by another guy hawking his own initial coin offering. Another followed, then another.
/goo.gl/Pxvpuq

Investors Are Celebrating the Tech Revolution; The economic transformation makes an era of steady growth and low inflation possible.
Tyler Cowen – Bloomberg
Why have U.S. stocks risen so high over the past year? That debate has focused on the costs of Trumpian instability versus the benefits of corporate tax cuts, but there’s another important angle: Investors now seem to think that steady growth and low inflation are compatible going forward. That’s largely because the tech revolution has taken positive turns toward a future of diverse and highly useful platforms, rather than monopoly and high prices.
/goo.gl/8u8zCz

Institutions

Deutsche Bank Deploys Tool to Map Climate Investment Risks
Emily Chasan – Bloomberg
Data to be used for passive investment indexes debuting in ’18; Maps can show how heat waves, wildfires may affect operations
Deutsche Bank AG’s asset-management unit is using a detailed map to determine where natural disasters spawned by climate change may pose the greatest risks to its investment portfolios.
jlne.ws/2hmBvjc

Japan’s Biggest Banks Confront Harsh Reality With Cost Overhaul
Gareth Allan and Yuki Hagiwara – Bloomberg
Mizuho is said to weigh cutting third of workforce in 10 years; BOJ says lenders’ overcapacity is putting pressure on profit
Years of shrinking interest rates, demographic challenges and threats from rapidly advancing technology are finally coming to a head at Japan’s biggest banks as they prepare to eliminate thousands of positions and downsize branches.
/goo.gl/6s6CjF

Regions

Japan’s Kobe Steel blames fake data scandal on corporate culture
Leo Lewis – FT
Kobe Steel has sought to blame at least a decade of data fabrication across multiple production facilities on a closed corporate culture, over-pursuit of profits and “unbalanced” factory management.
/goo.gl/zNggGq

China pledges to open finance sector to more foreign ownership; Official says foreign and domestic investors to be treated ‘equally’ when buying stakes
Gabriel Wildau in Shanghai and Hudson Lockett in Hong Kong – FT
China has announced plans to ease limits on foreign ownership of financial services groups, following years of complaints that such restrictions block foreign groups’ development in the country.
/goo.gl/tZni7T

How China Is Opening Up to Foreign Finance Firms
Paul Panckhurst – Bloomberg
China is thrusting open the door to its financial industry. Limits on foreign ownership for banks, asset managers, securities firms and insurance companies are all going, at least eventually. It’s all part of China’s move to gradually open up its $40 trillion financial sector as well as counter criticism that it’s been a one-sided player in global commerce. Symbolically, the announcement came the day U.S. President Donald Trump, a staunch critic of China’s trade and business practices, wrapped up his first visit to the country.
/goo.gl/uXbs1e

Russia Says It Will Retaliate Against U.S. Media Next Week
Henry Meyer – Bloomberg
Moves in response to foreign-agent label for state-run channel; CNN, Voice of America, Radio Liberty seen as possible targets
Russia said it will retaliate next week against American media after the U.S. government ordered state broadcaster RT to register as a foreign agent, following accusations it interfered in last year’s presidential elections.
/goo.gl/F4L7uT

Germany Could Escape Carbon Hole at Home by Investing Abroad
Mathew Carr and Brian Parkin – Bloomberg
Nation is set to miss its 2020 emissions-reduction target; Paris climate deal might spur unprecedented cooperation: RWE
Germany’s Chancellor Angela Merkel finds herself in a bit of a pollution pickle.
/goo.gl/63fpbV

China Moves to Open Market for Financial Firms in Historic Step
Bloomberg News
Nation removes foreign ownership limits on lenders, fund firms; Announcement coincides with Trump’s first state visit to China
JPMorgan Asia Pacific Chairman and CEO Nicolas Aguzin discusses China’s plan to open its financial system.
China took a major step toward the long-awaited opening of its financial system, saying it will remove foreign ownership limits on banks while allowing overseas firms to take majority stakes in local securities ventures, fund managers and insurers.
/goo.gl/vmppK5

Brexit

Brexit talks thrown into chaos after Ireland makes fresh border demands in leaked document
Peter Foster and James Crisp – The Telegraph
British hopes of opening Brexit trade and transition talks this December were thrown into renewed doubt as it emerged that Ireland is making fresh demands over the Northern Ireland border question, the Telegraph can reveal.
jlne.ws/2hm1KGA

BOE’s McCafferty Says Banks May Leave Before Brexit Deal Agreed
Fergal O’Brien and Jill Ward – Bloomberg
Moves may start if no news by spring, McCafferty tells LBC; Says political instability bad for business, markets
Bank of England policy maker Ian McCafferty said clarity on Brexit will be needed early next year to prevent banks starting to shift jobs out of the country.
/goo.gl/S9xcgP

EU Aims for December Brexit Deal as Talks Yield No Breakthrough
Ian Wishart – Bloomberg
European Union chief negotiator Michel Barnier said no breakthrough was made in Brexit talks this week, but progress was made on citizens’ rights and both sides are aiming for a deal in December.
/goo.gl/efWQMT

Brexit talks thrown into chaos after Ireland makes fresh border demands in leaked document
Peter Foster, James Crisp, brussels – Telegraph
British hopes of opening Brexit trade and transition talks this December were thrown into renewed doubt as it emerged that Ireland is making fresh demands over the Northern Ireland border question, the Telegraph can reveal.
/goo.gl/34VFos

Architect of Article 50 claims Brexit can be reversed
Laura Hughes – Telegraph
The British people are in danger of being “misled” by Government claims that Brexit cannot be reversed, the architect of Article 50 has warned.
/goo.gl/sDuHD3

Miscellaneous

Bike-Sharing Upstarts Are Flooding Europe With Cheap Cycles; Dockless systems present a big challenge to older operators—and the cities they serve.
Carol Matlack , Stefan Nicola , and Ania Nussbaum – Bloomberg
Until last summer, bike-sharing in Munich was an orderly undertaking: Two competing systems offered a total of 2,400 two-wheelers that riders could pick up at about 100 locations around the city. Then in September, after a company called OBike dropped 7,000 bright yellow rental cycles on sidewalks and streets across town, residents began complaining about bikes piling up outside subway stations and clogging parking spots. “Things began spiraling out of control,” says Florian Paul, the city official who oversees cycling programs. “It just overwhelmed people.”
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How did the news go ‘fake’? When the media went social; In all the fuss over misinformation, one crucial aspect is ignored: the way people now perform their relationship with news in order to win the approval of others
Claire Wardle and Hossein Derakhshan – The Guardian
The Collins Dictionary word of the year for 2017 is, disappointingly, “fake news”. We say disappointingly, because the ubiquity of that phrase among journalists, academics and policymakers is partly why the debate around this issue is so simplistic. The phrase is grossly inadequate to explain the nature and scale of the problem. (Were those Russian ads displayed at the congressional hearings last week news, for example?) But what’s more troubling, and the reason that we simply cannot use the phrase any more, is that it is being used by politicians around the world as a weapon against the fourth estate and an excuse to censor free speech.
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Bergstrom is chief information officer of John J. Lothian & Co. He edits MarketsWiki and JLN Options.