Breaking News

BOE’s Carney Calls for Rules to End Cryptocurrency Anarchy

anarchy

First Read

Don’t Blink, The Markets Are Changing Right In Front of Your Eyes; Eighteen Years Later, Another Inflection Point
By John Lothian – JLN

Eighteen years after the start of this newsletter, the markets and its participants face new challenges that make reading JLN today even more important, relevant and necessary to keep abreast of the latest disruptive challenges.

Today we find ourselves at an inflection point in the markets, with a new generation of digital natives discovering whole new opportunities in the markets, billions of dollars pouring into potentially disintermediating fintech and intense global interest in all things fintech and crypto.

Back in 2000, when this newsletter was first published, the markets were facing the move from traditional open outcry trading and other trading formats to electronic trading. The changes in market structure were going to impact everyone, and they did. Gone are firms, exchanges, traders and colleagues who could not pivot to the new electronic trading world.

Today, billions of dollars around the world are being invested in fintech applications which have the potential to disintermediate the disintermediators of the last eighteen years. Crypto markets, blockchain, artificial intelligence, machine learning, big data and other technologies represent material challenges to the status quo and the entities who profit from it.

For a deep dive into what is happening in fintech in the exchange space, read the World Federation of Exchanges & McKinsey joint report on fintech in capital markets infrastructure industry.

But don’t blink, because the world is changing right before your eyes.

For the rest of the commentary, click HERE

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Hits & Takes
JLN Staff

For the fourth year, a global collaboration across 59 stock exchanges around the world plans to ‘Ring the Bell for Gender Equality’ to celebrate International Women’s Day 2018 on 8 March. The World Federation of Exchanges is partnered with several other organizations to raise awareness. Is your exchange ringing the bell?~JK

Commodity Markets Council reported that Jim Newsome, former chair of the CFTC and co-founder of Delta Strategy Group, will replace Gregg Doud as CMC president. Doud was confirmed as Chief Agricultural Negotiator for the United States Trade Representative.~JJL

To find out more about or sign up for the CBOE’s Risk Management Conference, go to www.cboermcus.com.~JJL

Via LinkedIn: QB is thrilled to have won the CTA 2018 US Services Award for “Best 3rd Party Algo Trading Solution”~JJL

Hehmeyer is now publishing its own Hehmeyer Crypto Index (HCI), a weighted index of 12 coins. You can find it HERE. An investment pool based on the index is coming soon.

Do you want to know the top 15 cities for blockchain jobs, according to Forbes? Click HERE.~JJL

Timothy P. Peterson of the law firm of Murphy & McGonigle offers some good advice on what to do if the SEC comes calling about your ICO. See the story below.~JJL

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As SEC Subpoenas to Tech Companies in Digital Tokens Market Increase, What Issuers Need to Know
By Timothy P. Peterson – Murphy & McGonigle

(Timothy P. Peterson, a former senior counsel in the SEC Division of Enforcement, is a partner in the Washington DC office of Murphy & McGonigle.)

The Securities and Exchange Commission (“SEC”) reportedly has revved up its focus and issued a significant number of subpoenas targeting technology companies in the digital token space, following on earlier pronouncements from the agency that it would expand its focus on ICOs and cryptocurrencies. The subpoena process is one of the primary weapons in the SEC’s enforcement arsenal, and ICO issuers will need to understand what they can expect over the next few weeks.

What is a subpoena?

For the rest of the story, click HERE

**Also see JLN’s piece ICO Rules and Regs: Initial Coin Offerings Under Regulatory Spotlight

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NFA Board Update—February 2018 Meeting
NFA
NFA Vice-Chairman Maureen Downs and President Tom Sexton discuss highlights and other notable information from NFA’s February Board meeting, including NFA’s recent Long-Range Planning meeting, Board elections and cryptocurrencies. The video is intended to keep NFA Members and the investing public apprised of the important topics discussed by NFA’s Board.
/goo.gl/UM1NWT

***** Of course cryptocurrencies were discussed. What else would anyone talk about during the last few months?~JJL

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NFA permanently bars Chicago, Ill. introducing broker Fortune Trading Group, Inc.
NFA
NFA has permanently barred Chicago, Ill. guaranteed introducing broker (GIB) Fortune Trading Group, Inc. (FTG) from membership and from acting as a principal of an NFA Member. NFA also barred FTG’s sole principal and an associated person Jonathan Schuler from membership and from acting as a principal of an NFA Member for five years. In addition, NFA ordered Chicago, Ill. futures commission merchant Ironbeam, Inc. (Ironbeam), FTG’s guarantor, to pay a $100,000 fine.
/goo.gl/vs7zZK

***** That is how the cookie crumbles.~JJL

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Thursday’s Top Three
Thursday’s top read stories were led by Reuters’ article LJM Partners shutting its doors after ‘vol-mageddon’ losses in U.S. stocks. Second went to Business Insider’s Nasdaq pours cold water on the arguments fueling a civil war on Wall Street. Third went to Bloomberg’s slightly misleading headline This $1 Trillion Money Manager Just Joined the Crypto Frenzy, which was really more about Wellington investing in chip makers than trading on Bitcoin spot and futures markets.

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MarketsWiki Stats
121,366,036 pages viewed; 23,021 pages; 211,875 edits
MarketsWiki Statistics

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Lead Stories

BOE’s Carney Calls for Rules to End Cryptocurrency Anarchy
Lucy Mekin, Edward Robinson – Bloomberg
Says Bitcoin volatility shows problems with virtual coins; He rejects chances of central-bank issued crypto in near term
Mark Carney is calling for greater regulation to bring the era of cryptocurrency “anarchy” to an end. “The time has come to hold the crypto-asset ecosystem to the same standards as the rest of the financial system,” the Bank of England governor said Friday in a speech at Bloomberg’s European headquarters in London.
/goo.gl/gXhEoP

***Ok, I gotta say it: “Anarchy In The UK?”~JK

Nasdaq sues IEX for allegedly infringing technology patents; Rival claims move is attempt ‘to obstruct an innovative new competitor’
Nicole Bullock in New York – FT
Nasdaq is suing rival IEX, alleging the upstart exchange knowingly violated a series of Nasdaq patents in developing its trading platform.
/goo.gl/5mjqmu

***** The spirit of the ISE lives on at Nasdaq.~JJL

Overstock’s Byrne Says SEC Wants to `Know Everything’ About ICO
Lily Katz – Bloomberg
Regulator asked about investor accreditation, company history; Retailer has had many meetings with SEC and Finra, CEO says
Overstock.com Inc. Chief Executive Officer Patrick Byrne has a colorful history when it comes to dealing with Wall Street and regulators. It could get even more interesting.
/goo.gl/2FJymz

London Stock Exchange makes ‘good progress’ in hunt for new chief; Exchange continues to look at large deals as it reports double-digit earnings growth
Philip Stafford in London – FT
The London Stock Exchange Group is continuing to look at large deals even as the company had little news for investors on its long-running search for a new chief executive to replace Xavier Rolet.
/goo.gl/StLAqW

CME Group Announces New SOFR Futures Launch Date and Contract Specifications
CME Group
CME Group, the world’s leading and most diverse derivatives marketplace, today announced it will launch monthly and quarterly Secured Overnight Financing Rate (SOFR) futures on May 7, 2018, pending regulatory review. The futures will be based on the Alternative Reference Rates Committee-endorsed SOFR index, scheduled to be published daily by the Federal Reserve Bank of New York in cooperation with the U.S. Office of Financial Research beginning on April 3, 2018.
/goo.gl/Yo89WW

The CHX is a Target for Cryptocurrency Exchanges
By: Richard Johnson – Greenwich Associates
On February 15th, the SEC blocked the sale of the Chicago Stock Exchange (CHX) to a China-based consortium, due to concerns over the proposed ownership structure. This is the latest blow to the storied exchange, which was founded in 1882 but has struggled to stay relevant in a space dominated by ICE, Nasdaq and the Chicago Board Options Exchange (CBOE). Back in October, the SEC also put a halt on their plans to implement a speed bump that the CHX hoped would attract new business and boost their market share from a paltry 0.5%.
/goo.gl/FFCoVJ

OCC Declares Nearly $80 Million Clearing Member Refund for 2017
OCC
OCC, the world’s largest equity derivatives clearing organization, today announced the declaration of a nearly $80 million refund to clearing members under its approved capital plan. This is the second largest clearing member refund made by OCC since the inception of its capital plan.
/goo.gl/vBCvBF

Digital Tokens Rise Even as SEC Bears Down
Camila Russo – Bloomberg
Securities regulators in the U.S. are reportedly investigating a large number of digital-asset projects yet the market is responding with a resounding: “Crypto don’t care.”
/goo.gl/H7shX8

The SEC’s Uneven Cryptocurrency Crackdown; ICOs need tougher scrutiny, but so do Reg A+ stock offerings.
Stephen Gandel – Bloomberg
Two weeks ago, Bitzumi Inc., which describes itself as a “vertically integrated bitcoin exchange” of online media and crypto-related offerings, began soliciting investors on its website.
/goo.gl/Eq64r8

Tudor Jones likens Powell’s job to Custer’s Last Stand
Robin Wigglesworth – FT
Hedge fund magnate Paul Tudor Jones has compared new Federal Reserve chair Jay Powell’s job to that of George Custer “looking down at an array of menacing warriors” at the Battle of the Little Bighorn.
/goo.gl/PdeKmy

Japanese venture capital investment hits record levels; Panasonic joins Toyota and Sony in bid to fund innovative tech start-ups
Kana Inagaki in Tokyo – FT
Venture capital spending by Japanese corporations including Toyota and Sony have reached record levels as established companies look to the start-up world to keep pace with digital innovation.
/goo.gl/52xSA5

Schwarzman Collects $787 Million in ’17 to Rule Over Wall Street
Anders Melin and Melissa Mittelman – Bloomberg
The Blackstone Group LP co-founder received $786.5 million for 2017, his biggest take-home ever, according to calculations based on the firm’s annual report filed March 1. His stake in New York-based Blackstone—and the $661 million in dividends it yielded—fueled much of the payout.
/goo.gl/aLc4zs

Exchanges, OTC and Clearing

CME Group Reaches Highest-Ever Monthly Volume of 27.3 Million Contracts for February 2018
CME Group
CME Group, the world’s leading and most diverse derivatives marketplace, today announced it reached an all-time high monthly average daily volume (ADV) of 27.3 million contracts during February 2018, up 48 percent from February 2017. This milestone surpasses the prior peak of 20.9 million contracts in November 2016 by 31 percent. During 2018 to date, there were 26 trading days with volume above 20 million contracts, compared with four days during the same period in 2017. Open interest at the end of February was 130 million contracts, an increase of 11 percent from the end of February 2017, and up 21 percent from year-end 2017.
/goo.gl/9D7nep

OCC Announces Cleared Contract Volume Up 43 Percent in February; Securities lending up 39 percent in February and 34 percent year-to-date; Index options volume up 70 percent in February and average daily volume up 58 percent year-to-date; Cleared futures volume up 27 percent in February and average daily volume up 22 percent year-to-date
OCC
OCC, the world’s largest equity derivatives clearing organization, announced today that total cleared contract volume in February was 477,587,355 contracts, up 43 percent from February 2017 volume of 333,411,251 contracts. OCC’s year-to-date average daily cleared contract volume is up 39 percent from 2017 with 23,934,996 contracts.
/goo.gl/7eVQYt

Nasdaq Files Patent Infringement Lawsuit to Protect Intellectual Property; Lawsuit Aims to Halt Unauthorized Use of Proprietary Electronic Trading Platform Technology
Globe Newswire
Nasdaq (Nasdaq:NDAQ) filed a patent infringement lawsuit in the United States District Court for the District of New Jersey today, aiming to protect Nasdaq’s electronic trading technology from unauthorized use by IEX Group, Inc. and Investors Exchange LLC (IEX).
/goo.gl/Xb72ca

London Stock Exchange Group Plc Preliminary Results For The Year Ended
London Stock Exchange Group
Unless stated otherwise, all figures in the highlights below refer to continuing operations for 12 months to 31 December 2017 and comparisons with the prior 12 month period on the same basis.
/goo.gl/Uo6TSJ

London Stock Exchange profits rise but investors kept waiting for new CEO
Samuel Agini – Financial News
The London Stock Exchange Group saw profits rise sharply in 2017 but investors remain in the dark over who will be the next leader of the iconic British institution.
/goo.gl/XQxxTz

Data and clearing help boost LSE in slow markets; Exchange says it’s making ‘good progress’ finding a new CEO
Philip Stafford – FT
The London Stock Exchange Group shrugged off last year’s slow trading environment on global markets, reporting double digit earnings growth on the back of its push into indices and derivatives clearing.
/goo.gl/Fg9DZ2

FTSE Russell and LCH drive profits at LSEG;
Hayley McDowell – The Trade
The London Stock Exchange Group (LSEG) has reported a 17% increase in revenues in 2017, with its FTSE Russell and LCH businesses driving growth.
/goo.gl/Ei3epA

Cboe and oneZero Financial team up on market data; oneZero Financial’s clients will gain access to Cboe’s real-time market data.
Hayley McDowell – The Trade
Cboe Global Markets will provide institutional broker software provider oneZeroFinancial with real-time stock and quote and trade data.
/goo.gl/fvFx6b

Editorial changes of the General Terms and Conditions and the Price List of Eurex Frankfurt AG, effective 2 May 2018
Eurex
In agreement with the Swiss financial market supervisory authority FINMA, Eurex Zürich AG will discontinue the operation of its derivatives trading venue Eurex Zürich by 31 March 2018. Trading at Eurex Deutschland will continue unchanged. It will have no effect on the admission of Exchange Participants at Eurex Deutschland.
/goo.gl/jQ2Y4g

Introduction of discount for OTC IRS & ZCIS Gold Packs for Clearing Members’ own accounts
Eurex
Effective 1 March 2018, Eurex Clearing will introduce a discount on the OTC IRS and ZCIS Gold Pack for Clearing Members’ Own Accounts. The Discounted Gold Pack allows subscribing Clearing Members unlimited clearing of all OTC IRD products including IRS, OIS, FRA, Basis, ZCIS across all currencies from 1 March until 31 December 2018. The existing Gold Packs are offered at a discount of ~68 percent.
/goo.gl/JYGdHT

LME announces introduction of financial OTC booking fee and enhanced trading regulations
LME
Modifications made to financial OTC booking fee following market feedback; Proposed new rules concerning the use of LME data, systems, trading venues and intellectual property to be implemented with immediate effect; Financial OTC booking fee policy to be payable from 1 June 2018
The London Metal Exchange (LME) today announced the introduction of its updated Financial OTC Booking Fee Policy and enhanced trading regulations, following a consultation period with the market.
/goo.gl/4x7Gej

London Metal Exchange announces $1 OTC contract fee
Neil Hume – FT
The London Metal Exchange plans introduce a new fee from start of June for contracts in the over-the-counter market that reference its prices.
/goo.gl/6K5YCh

OCC securities lending activity sees increase
Securities Lending Times
OCC has calculated that its securities lending activity was up 39 percent in new loans from February last year with 224,374 transactions last month.
/goo.gl/p7DU45

The World Federation of Exchanges & five partner organisations bring together 59 stock exchanges to ‘Ring The Bell For Gender Equality’
WFE
For the fourth year, a global collaboration across 59 stock exchanges around the world plan to ‘Ring the Bell for Gender Equality’, to celebrate International Women’s Day 2018 (Thursday 8 March).
/goo.gl/gQq6Yg

Fintech

These 3 companies could sprint ahead of Wall Street when it comes to cryptocurrency
Frank Chaparro – Business insider
Fundstrat, the research firm, is predicting the next two years will be big for bitcoin and the world of crypto.
/goo.gl/XZ7euT

Ascent Technologies, a leading regulatory technology (regtech) company, announced the successful completion of their Series A funding round.
Finextra
Ascent raised $6 million in this oversubscribed round, which was led by Alsop Louie Partners and joined by Randall Kroszner, member of the Board of Governors of the Federal Reserve System from 2006 to 2009.
/goo.gl/sP2jm5

This Bitcoin-Trading Family Man Faced Years in Prison. Now He’s Telling His Story
Katy Steinmetz – Time
“When I first got into this, I’d have to explain what it was because no one would have any idea,” says Jason Klein says as he sips tea at a cafe in the Ozarks on a cold winter day. “Now it seems like I could walk up to almost anyone in this room and they’d know.”
/goo.gl/NDkVRK

Sheila Bair says bitcoin has no intrinsic value — but neither does the dollar
Mike Murphy – MarketWatch
Former FDIC chair Sheila Bair isn’t too worried about the mania surrounding cryptocurrencies, and sees no reason why bitcoin and its brethren should be outlawed.
/goo.gl/9cXips

Opinion: These 3 trends could give fintech a bigger say in your money matters
Eyal Lifshitz – MarketWatch
Uses and usefulness of financial technology are growing
Fintech, short for “financial technology,” is dramatically changing how consumers and businesses access and manage their money.
/goo.gl/v9XkD3

Bitcoin Transaction Volume Is Puzzling Investors; Bitcoin’s price comeback isn’t being reflected in transaction volume.
Bloomberg
Earlier this year, when Bitcoin’s price fell by more than 60% from its record close, a less-noticed Bitcoin figure also plunged: the number of daily transactions.
/goo.gl/gUb9e7

Former Fed governor helps fund markets compliance AI group; Investment highlights interest in using machine learning to reshape trading industry
Philip Stafford in London – FT
Former Federal Reserve governor Randall Kroszner is among a group of investors in a start-up US fintech company that has raised $6m to apply artificial intelligence to markets compliance.
/goo.gl/7h4bep

Cryptocurrencies failing as money, but technology has promise: Carney
William Schomberg, Andy Bruce – Reuters
Cryptocurrencies such as Bitcoin are failing as a form of money and have shown clear signs of being a financial bubble, but their technology could improve the financial system in future, Bank of England Governor Mark Carney said on Friday.
/goo.gl/eXRdDw

Politics

Senate Readies Rollback of Bank Rules; Midsize banks have been wondering if Republicans will actually loosen financial regulations. The Senate is about to try to.
Andrew Ackerman and Christina Rexrode – WSJ
The Senate is expected to soon approve the most significant bipartisan rollback of postcrisis financial rules since Republicans took control of Washington last year.
/goo.gl/tqnUdT

Crapo’s Dodd-Frank Rewrite Set for Senate Floor Vote Next Week
Elizabeth Dexheimer – Bloomberg
Senate Majority Leader Mitch McConnell has set the stage for a vote on one of the biggest rewrites of financial industry rules since the Dodd-Frank Act was passed nearly eight years ago.
/goo.gl/HMVUJY

Trump’s tariff war nudges Cohn toward White House exit; The president’s top economic adviser lost a battle to prevent the imposition of steep tariffs pushed by protectionist advisers.
Ben White And Andrew Restuccia – Politico
Gary Cohn, President Donald Trump’s top economic adviser, has been rumored to be on the brink of leaving the White House for months but stayed for one main reason: to stop the president from imposing steep tariffs. By Thursday afternoon, Cohn had lost the fight.
/goo.gl/NUjiML

Trump’s racially charged, xenophobic words hurt our economy. Will that make him stop?
Bennie G. Thompson, Opinion Contributor
President Trump’s incendiary, xenophobic rhetoric — often masquerading as homeland security policy — corresponds directly with recent declines in U.S. favorability abroad and overall global confidence in U.S. leadership.
/goo.gl/sF6mgs

Nothing Trump Does Can Save Coal; Don’t blame liberals and regulations; blame capitalism and technology.
Barry Ritholtz – Bloomberg
It’s not the new black. Photographer: Kirill Kukhmar/TASS/Getty Images
On the campaign trail and in the White House, Donald Trump has warmly embraced coal. He has rolled back regulations on its use and eliminated some federal subsidies for alternative energies like solar and wind, along with electric cars. A few coal miners even landed jobs in the industry as the producers anticipate rising use. “Coal is BACK, baby!,” Breitbart News declared.
/goo.gl/qVsF2d

Senate Intelligence Leaders Say House G.O.P. Leaked a Senator’s Texts
Nicholas Fandos – NY Times
The Senate Intelligence Committee has concluded that Republicans on the House Intelligence Committee were behind the leak of private text messages between the Senate panel’s top Democrat and a Russian-connected lawyer, according to two congressional officials briefed on the matter.
/goo.gl/ktBNJu

Trump’s Tariff Folly; His tax on aluminum and steel will hurt the economy and his voters.
The Editorial Board – WSJ
Donald Trump made the biggest policy blunder of his Presidency Thursday by announcing that next week he’ll impose tariffs of 25% on imported steel and 10% on aluminum. This tax increase will punish American workers, invite retaliation that will harm U.S. exports, divide his political coalition at home, anger allies abroad, and undermine his tax and regulatory reforms. The Dow Jones Industrial Average fell 1.7% on the news, as investors absorbed the self-inflicted folly.
/goo.gl/SbRnXQ

Trump’s Chaos Theory for the Oval Office Is Taking Its Toll
Mark Landler And Maggie Haberman – NY Times
For 13 months in the Oval Office, and in an unorthodox business career before that, Donald J. Trump has thrived on chaos, using it as an organizing principle and even a management tool. Now the costs of that chaos are becoming starkly clear in the demoralized staff and policy disarray of a wayward White House.
/goo.gl/cPovf1

SEC dropped inquiry a month after firm aided Kushner company
Bernard Condon and Stephen Braun?-?AP
he Securities and Exchange Commission late last year dropped its inquiry into a financial company that a month earlier had given White House adviser Jared Kushner’s family real estate firm a $180 million loan.
/goo.gl/DLCruC

Regulation

The SEC is reportedly investigating a number of ICOs
Jon Russell – TechCrunch
The SEC is getting up close and personal with companies that have raised ICOs, according to a new report.
/goo.gl/omxY7U

CFTC Chairman Giancarlo to Participate in a Fireside Chat at the Managed Funds Association’s Legal & Compliance 2018 Conference
CFTC
/goo.gl/rw9eo5

Carney calls for crackdown on cryptocurrency ‘mania’
BBC
Cryptocurrencies such as Bitcoin should be regulated to crack down on illegal activities and protect the financial system, Mark Carney has warned.
/goo.gl/RJ5r4q

BoE’s Carney calls for crypto crackdown; Bitcoin and other digital currencies ‘exhibit the classic hallmarks of bubbles’
Caroline Binham – FT
The governor of the Bank of England, Mark Carney, has pledged that it is time to regulate elements of cryptocurrencies and their ecosystem, as policy makers at the central bank weigh how much of a risk they pose to financial stability.
/goo.gl/QbmoZd

Bank of England chief Mark Carney says cryptocurrencies are failing as money
Caitlin Morrison – City AM
Carney said cryptos are too volatile to operate well as a system of money (Source: Getty)
Bank of England governor Mark Carney said cryptocurrencies are failing as a system of money.
/goo.gl/B4D9sz

Wells Fargo’s Wealth Management Unit Attracts Justice Department Attention; Whistleblowers accuse the bank of pushing products that may not have been the best fit for the customer
By Emily Glazer – WSJ
Wells Fargo & Co.’s problems are expanding to its wealth-management business. The Justice Department in late 2017 told the bank to conduct an independent investigation of its wealth-management business after whistleblowers from the bank alleged sales problems to the agency, people familiar with the matter said.
/goo.gl/Zqgpc2

ASIC takes action against Rio Tinto and its former CEO and CFO for misleading and deceptive conduct
ASIC
ASIC has commenced legal proceedings in the Federal Court in Sydney today against Rio Tinto Limited (RTL) and its former Chief Executive Officer, Mr Thomas Albanese, and its former Chief Financial Officer, Mr Guy Elliott. The proceedings relate to statements which ASIC alleges were misleading or deceptive contained in the RTL annual report for 2011 which was signed on 5 March 2012 and published on 16 March 2012.
/goo.gl/hGchxN

ASIC permanently bans financial adviser for unethical conduct
ASIC
The Australian Securities and Investments Commission (ASIC) has permanently banned Muneer Mahmood Khan (also known as ‘Ivan Khan’) from providing financial services after finding that he was not of good fame or character, and that he had acted unethically.
/goo.gl/SBp1iP

FINRA Foundation Seeks Applicants for Military Spouse Fellowship; Fellows Provide Military Service Members and Their Families with Financial Counseling and Education Services While Earning Professional AFC® Credential
FINRA
Starting today, the FINRA Investor Education Foundation Military Spouse Fellowship is accepting applications for its 2018 class of financial Fellows — a unique program designed to increase the financial capability of U.S. service members and their families.
/goo.gl/YZz824

Podcast: CFTC Talks EP033: Chamber of Digital Commerce
CFTC
This week on CFTC Talks, we bring on Chamber of Digital Commerce’s President Perianne Boring and General Counsel Amy…
/goo.gl/ZPFBh8

Investing and Trading

Stocks Roiled on `Trade War’ Talk; Bonds Advance: Markets Wrap
Robert Bland – Bloomberg
S&P 500 futures drop; carmakers lead European stocks lower; Japan’s Topix slumps after BOJ chief flags stimulus exit
Headwinds mounted for global stocks on Friday as President Donald Trump ratcheted up his “trade war” talk, compounding investor concerns over a more hawkish Federal Reserve and the timing of ending monetary stimulus in Japan.
/goo.gl/TBHtSX

California Fruit Will ‘Die on the Vine’ After ICE Raids, Labor Warns
Kartikay Mehrotra – Bloomberg
Undocumented workers are arrested, detained in federal sweeps; Oakland mayor’s warning condemned by administration, officials
Maria’s husband spent the past 15 years pruning citrus trees on farms across California’s Central Valley. In that time, he’d become skilled enough to earn more than the state’s $11-an-hour minimum wage trimming branches for Sun Pacific, the company that brings the Cuties brand of mandarin oranges to grocers and tables across the U.S.
/goo.gl/tmQf93

Are men hard-wired to take risks?; Why the idea that the ‘Lehman Sisters’ might have averted the financial crisis is a delusion
Cordelia Fine – FT
If you study the science of sex differences, social events always have a whiff of testosterone.
/goo.gl/1ZeHb8

Libor surge is nearing danger level for debt-drenched world
Ambrose Evans-Pritchard – Telegraph
New Fed chief Jay Powell at his hawkish debut on Capitol Hill this week
The stress signals of the global credit system are flashing amber. The offshore dollar funding markets that lubricate world finance are facing an incipient squeeze.
/goo.gl/b3tYQP

Volatility Is Back But Volatility Funds Are Duller; The managers of an inverse-VIX fund just reduced risk for investors and also for themselves
Spencer Jakab – WSJ
Capital Decimation Lite, anyone? Volatility is back in the stock market, but the investments that imploded spectacularly in February are gone except for one survivor. That fund is now a much tamer version of its former self.
/goo.gl/wHnBy1

Why It’s So Hard to Invest With a Social Conscience
Ron Lieber – NY Times
Peer under the hood of your mutual fund or portfolio of index investments. If you’re like most people, you’ll find that you own shares of at least a few companies that make you squeamish. Perhaps you no longer wish to make money when Equifax collects and sells your data, especially when it has proved that it can’t do so safely. Or perhaps you have soured on big banks that treat customers poorly.
/goo.gl/6rQCt3

Institutions

Scaramucci Says He Fears John Kelly Will Thwart SkyBridge Sale
Jennifer Jacobs – Bloomberg
Accuses Kelly of blocking him from meeting with Trump; Says he fears Kelly will stymie Skybridge sale in revenge
Former Donald Trump aide Anthony Scaramucci tore into White House Chief of Staff John Kelly, accusing him of blocking his access to the president at the White House and Davos and driving away Trump’s most-important advisers at a critical moment when the White House is in chaos.
/goo.gl/xyYDxq

Neuberger Berman boss Walker dismisses comparison with behemoths; While he takes engagement seriously, big passive managers are ‘in different industry’
Owen Walker – FT
On the school run in St Louis, Missouri, George Walker’s father would often stop the car outside a grand house. He would tell his son that inside lived the “big man” who ran the St Louis Trust Company, the local wealth manager.
/goo.gl/PCytZ8

Ken Griffin’s Citadel Dismisses 21 People
Katia Porzecanski – Katherine Burton – Bloomberg
Culling leaves stock unit with a dozen portfolio managers; About half of departures were hired from Visium in 2016
Billionaire hedge fund manager Ken Griffin has made a habit of pouncing on other firms’ distress to seize — or in some cases, save — top talent. He can also be unforgiving when it comes to his own business.
/goo.gl/MTXGfc

Barclays Won’t Face Criminal Case for Hewlett-Packard Trades
Tom Schoenberg – Bloomberg
New Justice Department approach encourages bank cooperation; Prosecutors will reward companies that report securities fraud
Barclays Plc will not face criminal charges over allegations that one of its traders defrauded Hewlett-Packard Co., signaling a new U.S. approach that results in lesser penalties for institutions that report securities fraud themselves.
/goo.gl/5SPWSF

BNP Paribas makes major reshuffle to global markets business; BNP Paribas has made a number of leadership changes to its electronic trading, prime services and derivatives teams across the global markets business.
Joe Parsons – The Trade
BNP Paribas has made a series of high-level appointments to its markets businesses, with the aim to integrate its electronic trading and technology teams.
/goo.gl/hikdLr

Regions

The Saudis Can’t Just Throw Their Bond Market Weight Around; The kingdom has to respect the power of the Fed.
Marcus Ashworth – Bloomberg
Saudi Arabia could return to the international bond market this month for a third time, once it has wrapped up refinancing a syndicated loan. The kingdom’s last two jumbo issues went well, but this time is different.
/goo.gl/sg8iNA

EU considers imposing ‘safeguard’ import tariffs in response to US; Trade commissioner says Trump’s move could have ‘dangerous domino effect’
Shawn Donnan in Washington – FT
The EU will consider imposing its own “safeguard” tariffs on imports of steel and aluminium in response to US president Donald Trump’s decision to levy national security tariffs on imports of the metals from around the world, the EU’s top trade official has warned.
/goo.gl/34dE6A

Russia to Rescue as Europe Draws More Gas in Siberian Chill
Elena Mazneva, Anna Shiryaevskaya, Matthew Carr – Bloomberg
More pipeline shipments and a rare LNG cargo due to arrive; Spot gas prices in Europe tripled to a record as demand surged
Russia is sending more natural gas to Europe than ever before as a blast of Arctic air lifted demand for heat and electricity, underlining the region’s dependence on its eastern neighbor.
/goo.gl/MXcCgX

Oil Traders Make Sea Odyssey as Gasoline Criss-Crosses Globe
Ann Koh, Serene Cheung, Laura Blewitt – Bloomberg
China supplying Mexico, which usually imports fuel from U.S.; Just weeks ago, cargoes also moved from Europe to Australia
Over the course of March, the oil tanker Nave Pyxis will slice through the Pacific Ocean as it makes an unusual journey of about 8,000 miles from China to Mexico.
/goo.gl/HCZZ6S

Amsterdam Prepares for Bumper Crop of IPOs
Wout Vergauwen, Ruben Munsterman – Bloomberg
Alfen listing intention is third IPO announcement this week; LeasePlan, Adyen biggest name that could still come this year
The Dutch IPO drought is over. With at least four confirmed initial public offerings in Amsterdam, 2018 is already looking twice as busy as all of last year.
/goo.gl/eP1NYQ

Venezuelans Are Paying a 100% Premium for Cash; It’s yet another infuriating inconvenience of living in an imploding economy.
Andrew Rosati – Bloomberg
My most recent order arrived by motorcycle, a loaded, black trash bag tossed my way. “This is what’s available,” the courier said gruffly before zooming off. I nodded. There’s no begging in the bolivar business.
/goo.gl/3dNh8Z

Deutsche Bank, JPMorgan Hire as Banks Look Past Saudi Purge
Sarah Algethami, Matthew Martin – Bloomberg
Banks announce new hires, deals after anti-corruption campaign; Deutsche Bank sees ‘more positive’ outlook for deals
Global banks are pushing ahead with growth plans in Saudi Arabia four months after a crackdown on corruption threatened to derail ambitious plans to transform the economy.
/goo.gl/793DQD

Brexit

A No-Deal Brexit Risks U.K. Food Crisis, Sainsbury CEO Warns
Sam Chambers – Bloomberg
Leaving EU with no deal is ‘inconceivable,’ Coupe says; U.K.-EU tensions simmer over shape of trading relationship
Brexit would lead to an unprecedented food shortage if the U.K. leaves the European Union without a deal, the CEO of the country’s second-biggest grocer said.
/goo.gl/wwkGkp

Miscellaneous

David Mullins Rose to Fed Vice Chairman, Then Joined Doomed Hedge-Fund Firm; Finance expert taught at Harvard and helped sort out S&L crisis in the 1980s
James R. Hagerty
David W. Mullins Jr. -1946-2018
David W. Mullins Jr. had a soaring career as a finance professor at Harvard, a senior Treasury official under President George H.W. Bush and vice chairman of the Federal Reserve Board. He helped clean up after the widespread collapse of savings and loan institutions in the late 1980s and steered the Federal Reserve to lower interest rates in the early 1990s. He was seen as a possible future Fed chairman.
/goo.gl/4PfiDY

A Fake-News Warning From a Former Propagandist; Why readers shouldn’t underestimate the power of disinformation.
Faye Flam – Bloomberg (paywalled)
From to, viral fake news stories often seem propelled by their own preposterousness. It’s a different matter for professionally produced disinformation. That, I learned from a former pro, requires a core of logic and verifiable fact.
/goo.gl/BE3cBP

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About Author

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