John Walsh of the OCC says that current regulation proposals to fix derivatives far exceed the scope of the problems. Hedge funds, having loaded up on Greek debt, are trying now to unload the paper to avoid a bad haircut but are finding few takers. The SEC is stalled in the process of creating rules to require broker fiduciary duty to clients. The FIA establishes a post-MF Global problem-fixing task force, with super-sized companies appointed to steer the effort. In today’s top box, commentary from Doug Ashburn on the state of the Swiss Franc; and a lighter view of a…
Author Archives: Jon Matte
John Lothian Newsletter: NYSE Euronext Explores Adding Partners To Amex Joint Venture; Private equity profits called into question; Osaka to delay key futures contract launch
NYSE Euronext is considering a plan to add more equity partners to its Amex stock exchange. Studies, news and books are pointing out that returns from private equity organizations have done a great job of rewarding the PE managers, but not so much the investors. Japan’s OSE slows down plans to release a new futures contract; bad news for an exchange that is seeing dwindling volume.
John Lothian Newsletter: John Lothian News launches FuturesCrowd.com; ELX Futures Hires Jaycobs As CEO, Wolkoff Departing; New rules are struggle for industry and regulators
John Lothian News announces the launch of the FuturesCrowd.com website, a new venue to help gather problem solvers to address critical issues within the futures industry. Neal Wolkoff says farewell to ELX Futures, and Richard Jaycobs is tapped to lead the exchange. Throughout the financial industry, as regulators struggle to quantify and complete new rules, exchanges, brokers and other participants struggle to understand how to track and implement the constant stream of changes.
John Lothian Newsletter: FSA Pressures Banks to Hand Over MF Global’s U.K. Client Money; Eris Exchange to Distribute Market Data Through CME Group; Volcker Rule Regulators Resist Lawmakers Calls to Scrap Proposal
Britain’s FSA steps harder on the feet of banks in an attempt to get them to release customer money following MF Global’s demise. Eris Exchange reaches an agreement to distribute its SwapBook data via CME Group’s Market Data Platform. Despite calls to just throw away the Volcker Rule and start over, or not at all, regulators working on the issue insist that in the end, they’ll have a viable solution using what they’ve already got so far. In today’s top box, JLN’s Nicole Rohr supplies a Five Minutes interview with Alice Botis of Fidessa; and Hernan Arellano and Felipe Gazitúa…
John Lothian Newsletter: MF Global Commodity Customers Must Be Paid First, CFTC Says; SEC Charges Fund Managers and Analysts in Insider Trading Scheme; IMF requests $500bn for bail-out loans
The CFTC says that MF Global’s trustee has made rookie errors about bankruptcy payouts, and that the ex-brokerage’s customers are first in line for payback. The SEC continues its insider-trading cleanup program by arresting fund managers and analysts, and leveling new charges in some cases at the firms themselves. The IMF, looking over the European crisis, asks for more capital in order to weather rough financial seas ahead.
John Lothian Newsletter: Deutsche Boerse CEO says consolidation is inevitable; S&P Gets No Respect in Market With Lower Yields After Downgrades; World Bank warns emerging nations
DB’s Reto Franconi says that even if the DB-NYSE merger fails, he’ll still be looking for ways to merge his exchange with others. S&P’s downgrades of various countries, banks and funds creates a lot of attention, but not much immediate reaction from investors. The World Bank sounds a grim note to emerging nations, warning them to prepare for financial trouble if the European crisis continues to worsen. In the top box today, double commentary: one from Doug Ashburn of JLN FX on Mario Draghi; and one from Jim Kharouf of JLN Managed Futures on the state of the managed futures…
John Lothian Newsletter: MF Global trustee warns of pay-out shortfall; SEC, Exchange Officials Meet On Market Supervision; NYSE says no more concessions for Deutsche Boerse merger
MF Global’s bankruptcy trustee warns that it may not be able to fully reimburse 100% of the amount that customers are missing. The “flash crash” fallout continues as the SEC steps up enforcement actions and gag orders against exchanges. NYSE Euronext deputy chief executive Dominique Cerutti claims the exchange won’t make any further concessions to gain approval from EU regulators of their merger with Deutsche Boerse. And NYSE Liffe U.S. is named ‘Exchange Of The Year’ By Risk Magazine.
John Lothian Newsletter: NYSE CEO: EU Antitrust Review ‘Fundamentally Flawed’; ICE appoints LME member JP Morgan to advise on potential LME bid; New Rules on Swaps Will Protect Big Traders
Reaction to the recommended rejection of the DB-NYSE merger is loud and varied, including one from the NYSE Euronext CEO that the regulatory review was just plain bad. ICE hires JP Morgan to help them work on a bid for the London Metals Exchange, which is also in today’s news for record-breaking volume announcements, and a quarrel over whether dramatically raising fees right before being acquired is a smart decision. The CFTC yesterday voted to pass rules and proposals regulating swaps, though despite publicity and buzz regarding MF Global, the new rule does not appear to address that type of…
John Lothian Newsletter: Europe set to block DB-NYSE tie-up; Citi chief urges risk disclosure shake-up; Hedge funds lock horns with IMF on Greek debt
Early reports suggest that European regulators are preparing to reject the DB-NYSE merger. Vikram Pandit of Citigroup suggests that banks should explain the methods used to evaluate risk, providing more insight into the degree of optimism present in bank self-evaluations. Hedge funds involved with Greek debt add their name to the IMF’s “bailout complications” list. And in regulation, the CFTC prepares to vote on Dodd-Frank rules from last year; while other agencies consider including clearing houses, insurers and other types of firms to in “too big to fail” considerations that were once applied just to banks.