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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: At Least Three Banks Seen Central To Libor Rigging; Surge In Suspicious Trade Reports To FSA; France’s Hollande Lays Dodo Bird Egg With First Budget Standard

More of Barclays’ partners in Libor crime come to light, and the head of RBS says he expects the bank to pay a hefty fine (given what happened to Barclays, that may be a statement of optimism and hope). Ever since Britain’s FSA declared its intention to spot-check internal corporate vigilance, the number of suspicious trade reports filed by companies with the FSA has doubled. France is set to start its new financial transaction tax on Wednesday, and reactions to the idea are decidedly not all favorable.

John Lothian Newsletter: ICE Futures U.S. To Close New York Trading Floor; CFTC Panel To Weigh New Customer Fund Safeguards; CME Group Executives Launch Defense Of Libor Standard

IntercontinentalExchange announces that their ICE Futures U.S. New York operation will go fully electronic by fall of this year.  The CFTC’s technology panel takes on the issue of customer fund safety in their latest meeting.  CME Group defends the LIBOR rate product, though not the manner in which it was manipulated.  If you missed it yesterday, you can pick up the interview with Jae-Joon Lim of Korea Exchange, discussing Kospi products and the prospects for yuan-denominated clearing.  Also, Doug Ashburn gets out his pen to cover the solid launch of GCF Repo Index Futures over at NYSE Liffe U.S.

John Lothian Newsletter: Low volumes at U.S. exchanges keep earnings under pressure; PFG Has Regulators on Defense in Congress; Nomura CEO Watanabe to Resign Amid Scandal Standard

As financial exchanges prepare to release earnings, concern is voiced about poor results stemming from ongoing low volumes.  The PFG fraud scandal brings regulatory leaders before Congress to testify about what went wrong.  In Japan, where systemic wrongdoing is also popping up here and there, the CEO of broker Nomura resigns in the midst of insider-trading problems at that firm.  In MarketsWiki.tv, you’ll find links to new interviews with various people in the industry. 

John Lothian Newsletter: LME Investors Approve Sale To HKEx; New York Fed Faces Questions Over Policing Wall Street; ASX And SGX Set To Share Access To Data Standard

Voting day has arrived, and the shareholders of the London Metal Exchange vote in favor of a sale to HKEx.  The New York Fed faces pointed questions about why it saw problems with LIBOR rates, yet felt no inclination to actually let anyone outside the system know about them.  If they can’t merge, they can still cooperate:  exchanges in Australia and Singapore agree to share data center resources.  In today’s First Read, Jim Kharouf points out unsavory aspects of a new lawsuit that dredges up old accusations.

John Lothian Newsletter: CME Exploring Use of Clearinghouses to Hold Client Funds; Libor Probe Expands to Bank Traders; Spain, Italy Ban Short Selling to Slow Market Turmoil Standard

CME Group, stung by a second brokerage that misused its customer funds, proposes taking customer funds away from brokers and storing the money in a safe place.  The LIBOR investigation is now targeting individual groups of traders at multiple institutions. Spain and Italy reinstate previously-ineffective bans on short selling at their exchanges, evidently this time hoping for a different result from the same action.  In today’s First Read, Jim Kharouf discusses the CME Group’s fund safety plan.

John Lothian Newsletter: Futures Overseer Plots Revamp; Singapore Exchange Chief Eyes Asia IPOs; NYSE Seeks Clearing Expansion, Cost Cuts Standard

Regulators in various financial centers are showing, for the moment, energy and motivation for reviewing and upgrading policies and practices. The Singapore Exchange’s head continues to work on organic growth rather than mergers, and has his eye on boosting Asian IPOs. Following their failed merger, NYSE Euronext looks to cost cutting and increased clearing services to light its way forward.  In First Read today, Jim Kharouf experiences the pain of theft, and finds it’s not much different being ripped off by a financial thief or a common household burglar.

John Lothian Newsletter: Libor Director Swaps BBA For Thomson Reuters; Singapore Bourse Says Not In Merger Talks With LSE Standard

Libor Director Swaps BBA For Thomson Reuters; Singapore Bourse Says Not In Merger Talks With LSEThe director responsible for the management of the setting of Libor at the British Bankers’ Association has left his post, just as a group of banks being investigated in an interest-rate rigging scandal are looking to pursue a group settlement with regulators. Lots of talk about SGX and LSE planning a merger, although it seems that is being refuted.

John Lothian Newsletter: Rate probe turns to four major banks; US regulators warn of tri-party repo risk; Singapore Exchange tightens listing rules Standard

As expected, the baleful eye of the regulators swings toward four more banks that may have engaging in LIBOR shenanigans with Barclays.  As if the current crop of regulatory train wrecks were not enough, the tri-party repo market is flagged as having been systemically vulnerable to trouble for years.  Singapore Exchange toughens requirements for listing companies, hoping to reform its roll of titles and attract more interest from around the world.  In the top box, take a look at a MarketsWiki.tv interview with Cinnober CEO Javier Tordable; and if you haven’t seen the MW.tv interview with Kevin Cook of Autumn…

John Lothian Newsletter: CFTC Chief Admits Failure In Oversight Of Peregrine; U.S. To Launch Broad Review Of Futures Firms; Tradition Brokers First Trade On LNG East Asia Index Standard

Gary Gensler, head of the CFTC, agrees that the agency fell short when it failed to detect fraud at Peregrine over a 20-year time frame.  With a second, fresh failure in the “customer fund safety” department, a number of companies and regulatory groups in the futures industry have agreed to undertake bold steps to actually verify that funds on deposit are fully and properly in place for remaining companies in the industry.  Broker Tradition has successfully completed the first-ever exchange-cleared (using CME Direct Screen) OTC trade for liquid natural gas.