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Category Archives: John Lothian Newsletter

The John Lothian Newsletter provides news and commentary about the global exchange traded derivatives, securities, environmental and related OTC markets. The daily email intelligence briefing and companion blog are edited by and .

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 Standard

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 Standard

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 Standard

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.

John Lothian Newsletter: SEC wants banks to say more on European debt exposure; U.S. Inquiry of MF Global Gains Speed; LME’s steel plans tarnished by MF Global Standard

The SEC is pushing banks to provide more data on their exposure to European sovereign debt, on the off-chance that they are swimming with the same sharks that ate MF Global.  Speaking of MF Global, regulators report progress in the “where did the money go” investigation; and (speaking of swimming) the London Metals Exchange find itself in a drained pool, its hopes of forging a steel benchmark futures contract at odds with dramatically lower volume with major player MF Global gone.  In the USA, Walter Lukken has been chosen to lead the Futures Industry Association; and JLN’s Jon Matte is…

John Lothian Newsletter: Global regulators signal leeway on new bank liquidity rules; Mexico’s BMV to be among fastest bourses by May; Wall Street Prepares to Take Sharp Pay Cut Standard

An international regulatory group, while making tough plans for bank liquidity requirements, are also finding time to plan out exceptions to those new rules. Exchange operator BMV proceeds apace with infrastructure upgrades that will make the Mexican exchange one of the fastest in the world. As Q4 earnings, or lack thereof, are tallied for financial firms, a number of those firms are signaling that bonuses may be paid out closer to earth than the stratosphere this year. In Europe, David Cameron continues to declare his opposition to (and willingness to sabotage) a new financial transaction tax. And under pressure from…

John Lothian Newsletter: SEC Blesses CBOE Stock Exchange’s Deal For National Stock Exchange; Fed Forecasts Pose Risk For Soft Interest-Rate Futures Volume; European Banks Prepare More Job Cuts Standard

The U.S. SEC gives a thumbs-up to CBOE Stock Exchange’s plan to take over the National Stock Exchange.  The Federal Reserve’s plan to make an advance timetable for its actions is creating concern that without uncertainty from meeting to meeting, trade in interest-rate futures will suffer.  In Europe, more banks are preparing to shed more jobs; and Hungary, after failing to raise enough money on its own, is now interested in an IMF loan to help pay its bills. Today’s top box contains an article by JLN editor Sarah Rudolph on the CBOE BuyWrite Index.

John Lothian Newsletter: NYSE Euronext Plans New Contracts In Futures Challenge To CME; France to push ahead with ‘Tobin tax’ proposal; China set to bolster short selling Standard

NYSE Liffe U.S. announces new interest rate futures contracts that take aim at CME Group’s market share.  France’s government moves aggressively forward on plans to establish a financial transaction tax well ahead of other nations.  China is set to boost its short-selling industry to expand the depth of its capital markets.  In banking, RBS contemplates shutting down its investment banking business, potentially putting ten thousand jobs on the negative side of that transaction.  And in today’s top box, JJLCO is hiring!  If you’ve got sales chops, high ethical standards and a big sense of humor, we’d love to hear from…

John Lothian Newsletter: CFTC Won’t Delay Position Limits; Regulators inching forward on Dodd-Frank rules; Bring Back Boring Banks Standard

The CFTC rejects the idea of further consideration on position limits, and moves forward with its rules.  With regard to Dodd-Frank, however, rule adoption continues at a snail’s pace.  Calls arise from economists and bloggers to return banks to an old and tested role:  that of a place where money is cultivated in a boring, slow and relatively-low-risk manner.  In the top box, JJLCO announces that GFI Group has joined as a JLN sponsor; and Leo Melamed takes aim at Bart Chilton’s cheetah.

John Lothian Newsletter: EU Said to Prepare Draft Decision on NYSE-Deutsche Boerse Merger; Canada Cites NAFTA Breach if Volcker Adopted; Regulators Fleeing Credit Raters Embrace Zero-Risk Greek Bonds Standard

A draft decision regarding the NYSE-DB merger is underway, and might be released as early as next week.  Canada’s bank regulator joins the opposition to the Volcker Rule, saying its implementation could destabilize economies and violate free trade agreements.  US banking regulators turn away from credit rating agencies (paid by those who are rated) and cast a favorable eye toward the OECD (which represents member governments and rates their bond risk as zero) as a fascinating way to escape organizations without a conflict of interest.  Around the globe, the tide shifts away from 2011-in-review (including “look at all the things…