Observations – Statistics – Commentary
Run Terry, But Don’t Go Far
by John J. Lothian
Friday a story popped up in my email box with a “Terry Duffy” key word alert from Google. The story from Fox Business said Duffy was threatening to move the CME Group out of Chicago and Illinois because CME was a public company and the state of Illinois had just raised corporate taxes. No one asked him if he wanted his taxes raised, he said.
Liking to stir the pot when I see a good chance, I Tweeted the story and asked “what happened to Chicago as Risk Management Capitol? It did not take very long for CME Group’s communications team to see this and quickly respond with a Tweet of their own with a link from a Reuters story refuting the Fox Business story and its interpretation of Duffy’s comments.
First hats off to the CME communications team. They did exactly what they are supposed to do. Monitor mentions of the CME and quickly respond to any misinformation.
Secondly, there was a time when the leaders at the various Chicago exchanges were also active commercial, community and political leaders. Perhaps Mr. Duffy, who has long had political aspirations, should apply them to the state of Illinois and run for Governor the next time the election cycle runs around. Don’t just solve the problem of the CME Group, but help bring financial and political leadership for all businesses in Illinois. He should apply his business and political skills to solving the financial problems of the State of Illinois as Governor.
On Friday I worked on a page on MarketsWiki for the very first president of the Chicago Board of Trade, a gentlemen by the name of Thomas Dyer. According to various sources I could find, Mr. Dyer was President of the Chicago Chamber of Commerce in 1848 when he participated in the forming of the Chicago Board of Trade. Another man, George Smith, was elected to serve as the first CBOT president, but he declined. Dyer was then selected to be the first president, which I believe was an unpaid position.
Dyer later served as Mayor of the City of Chicago from 1856 to 1857. He also served in the legislature and was twice a delegate to the Democratic Convention. Like Duffy, Dyer had a public servant father. Dyer’s father had served in the US Revolutionary War.
Mr. Duffy is certainly a community leader and active in political circles representing and promoting the CME. With all the regulatory challenges the CME Group and the rest of the financial services industry faces, the CME and industry need his leadership. However, there was a time when business people stepped up to serve the public in elected office. Given how bad the finances of the State of Illinois are and the leadership void in the Illinois Republican Party, maybe the time has come for Mr. Duffy to serve his state.
With CME Group and financial industry friend Rahm Emanuel looking like a sure thing for Mayor of Chicago, perhaps the time is right for Mr. Duffy to run.
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Chicago Mercantile Exchange Considering Moving After Tax Increase
Chicago – The head of the company that owns the Chicago Mercantile Exchange and Board of Trade is threatening to leave Chicago.
http://jlne.ws/epfM7M
*** Yes.
CME nixes report that had exchange leaving Chicago over tax hike
(Reuters) – CME Group Inc., which runs the Chicago Mercantile Exchange and the Chicago Board of Trade, has no plans to leave the city, despite concerns over Illinois’ recent tax hike, a spokeswoman said on Friday.
Crain’s Chicago Business
http://jlne.ws/fuhVda
**** No
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Wall Street’s Collapse to Be Mystery Forever: Jonathan Weil
By Jonathan Weil – Bloomberg
To get to the heart of what went wrong with the report released yesterday by the Financial Crisis Inquiry Commission, check out its account on page 254 of how the largest investor in a cash fund managed by Bank of America suddenly pulled out $20 billion of its money in November 2007.
***JM: Nicely done, Mr. Weil.
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Banks face loss of IT staff to hedge funds
By Philip Stafford – Financial Times
Investment banks are face losing key IT staff to start-up hedge funds offering double pay and equity incentives as trading firms fight to build increasingly competitive computerised trading networks.
http://jlne.ws/f3kery
***JM: Alas, if only investment banks could also pay bonuses and incentives to the employees they find valuable.
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CBOE Hosts 27th Annual Risk Management Conference, February 27 – March 1, in Dana Point, California
CHICAGO, January 28, 2011 – The Chicago Board Options Exchange (CBOE) today announced it will host its annual Risk Management Conference — one of the longest-standing, premiere events in the financial industry — from Sunday, February 27 through Tuesday, March 1, 2011, at the St. Regis Monarch Beach resort in Dana Point, California.
Among thirty risk management practitioners presenting at RMC are keynote speakers Dr. Jose Pinera, Former Minister of Social Security of Chile (“Reinventing Social Security for the 21st Century”); David M. Blitzer, Ph.D., Managing Director & Chairman of the Index Committee, S&P Indices (“The S&P 500 for 2011 and Beyond: An Economist’s Look Forward”); and William J. Brodsky, CBOE Chairman and CEO (“Report from Washington: Congressional and Regulatory Update”).
Sessions include:
* “Tail Risk Protection: How and Why Investors Might Hedge Downside Risk”
* “VIX Option Strategies and Short and Relative Value Volatility Strategies”
* “Volatility ETNs & ETFs: Pros and Cons of Volatility-Based Investment Products”
* “Equity Correlation and Macro Investment Decisions; Crash Risk and Correlation Trading Paradigms”
Registration and hotel information, a schedule of events and sessions, and a roster of speakers are available at www.cboermc.com. Please inquire about discounts for qualified end-users and complimentary registration for journalists.
http://jlne.ws/erJymE
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Environmental Markets Newsletter
Markets May Be ‘Significantly Harmed’ by CO2 Theft, Traders Say
Ewa Krukowska and Mathew Carr – Bloomberg
Europe’s emissions markets may be “significantly harmed” unless regulators set a deadline for fixing the security flaws exposed by carbon thieves, the International Emissions Trading Association said.
http://jlne.ws/gREQ6s
Carbon Futures May Gain From Prompt Losses, Bache Says
Catherine Airlie and Mathew Carr – Bloomberg
Carbon traders are shifting to futures from spot transactions to minimize their risks in the wake of hacking attacks that left an estimated $41 million worth of permits missing, according to Bache Commodities Ltd.
http://jlne.ws/hDiofh
EU Carbon Market Suffers Further Setback
Sean Carney – Wall Street Journal
Some European national registries of carbon-dioxide-emission allowances Friday said they were waiting for the European Commission to authorize a resumption of the troubled European Emissions Trading Scheme after the EC shut spot trading Jan. 19 due to cyberfraud.
http://jlne.ws/gcjimC
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JLN Metals Edition
Small Trader Makes Big Waves
WSJ.com
A huge trade by a tiny hedge fund has sent shudders through the gold market. Thanks to the nature of futures trading, Daniel Shak’s $10 million hedge fund held gold contracts valued at more than $850 million, more than 10% of the main U.S. futures market, and the equivalent of South Africa’s annual gold production.
http://jlne.ws/hoXiYT
** This spread trader accounts for the massive drop in open interest and provides more fodder for the position limits cap discussion.
Strange Currency
Return to the gold standard? It’s just crazy enough for some state legislators to propose it.
Slate Magazine by Annie Lowrey
Imagine it’s April 15 a few years from now. You need to pay your state taxes, and fast. So, you check out the latest official state exchange rate, and then reweigh your bars. You’re over-thank goodness-so you hope the tax office has some ingots to change out. It’s such a pain when they run out of ingots. After you pay your taxes, you need to pick up a few groceries. Luckily, you have some spare silver ore on hand and decide to use the home mint in the basement to pop out a few coins. Voilà-restocked pantry!
http://jlne.ws/hom5CQ
** Looks at recent efforts to return to ‘sound money’ and the many inherent difficulties of tying a major global economy to a scarce resource that is predominantly produced elsewhere. Required reading for Ron Paul and his minions; oh, and Hugo Salinas Price.
The Cheviot Sound Money Conference
An essay by Hugo Salinas Price
Since ancient times one of the most important activities which any State exclusively reserved to itself was the minting of the nation’s money. In our age we have seen that modern banking systems have completely usurped this fundamental function of the State. Had the banking systems of the world fulfilled this function correctly, we should not be pondering monetary matters.(Downloads PDF)
http://jlne.ws/eeG6t9
** See above.
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MarketsWiki Page of the Day
Gerstenberg & Company
http://jlne.ws/feZete
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MarketsWiki Recent Updates
People
Thomas J. Hammond; Brad Vannan; David J. Peniket; Johnathan Short; Charles Walker; Thomas Dyer; Bernard Dan; William Parke; Patrice Blanc; Adolph Gerstenberg; Charles Gerstenberg
Companies, Organizations and Groups
IntercontinentalExchange Inc.; Chicago Board of Trade; Newedge; Gerstenberg & Company; Stock Exchange of Thailand
Miscellaneous
Presidents of the Chicago Board of Trade; Chicago Board of Trade Building; Social Security
Statistics
8,446,576 pages viewed, 5,925 articles, 108,004 edits
MarketsWiki Statistics
Lead Stories
ELX Announces New 9 Cent One-Tier Fee Schedule For All U.S. Treasury And Eurodollar Futures Contracts
New York, January 31, 2011– ELX Futures, L.P. (ELX), a leading electronic futures exchange, announced today a new 9 cent one-tier bundled fee schedule for market users trading all U.S. Treasury and Eurodollar futures contracts on ELX, effective February 1, 2011.
www.elxfutures.com
*** ELX plays limbo with the CME Group and NYSE Liffe US. With NYSE Liffe US poised to introduce their NYPC clearing solution, this move keeps the price pressure on both exchanges.
ELX Futures to Charge 9 Cents for Treasury, Eurodollar Trades
By Matthew Leising
Jan. 31 (Bloomberg) — ELX Futures LP, the derivatives exchange owned by Wall Street’s largest banks, will charge 9 cents for all trades of U.S. Treasury and Eurodollar futures contracts starting Feb. 1, the New York-based company said in an e-mailed statement today. ELX is seeking to compete with CME Group Inc., the world’s largest futures market, and home to the most active Treasury and Eurodollar futures trading.
ELX Futures Aggressively Drops Trading Fees For Rate Futures
By Jacob Bunge Of DOW JONES NEWSWIRES
ELX Futures LP said Monday that it will this week cut trading fees on its derivatives exchange to a flat 9 cents per contract ahead of the expected launch of a new rival.
The user-owned U.S. exchange operator told traders that it would lower fees on futures contracts on Treasury yields and inter-bank lending rates to 9 cents per contract beginning Tuesday, as the still-small challenger works to draw business.
http://jlne.ws/gHKfcH
ICE Futures Europe Sets Daily Volume and WTI Crude Futures Records
London (31 January 2011) IntercontinentalExchange, Inc. (NYSE: ICE), a leading operator of global regulated futures exchanges, clearing houses and over-the-counter (OTC) markets, announced that ICE Futures Europe set an exchange-wide daily volume record of 1,492,384 contracts on 28 January. The new record surpassed by 4.4% the previous daily record of 1,429,283 contracts, which was established on 12 January 2011.
http://jlne.ws/eStwrD
Euronext sparks outrage with tick size reduction
By Jeremy Grant – Financial Times
Euronext has said it will reduce the increments by which share prices are allowed to fluctuate – so-called “tick sizes” – on Dutch and French blue chips shares from next month, breaking a truce between competing platforms agreed over a year ago to avoid such moves.
http://jlne.ws/i0AixD
Nasdaq OMX lures trades to platform
By Telis Demos in New York – Financial Times
Nasdaq OMX has captured up to 1 per cent of total US share trading on a new type of platform that aims to lure large blocks of trades back on to exchanges. The claim by Eric Noll, head of US trading operations at Nasdaq OMX, comes as regulators are questioning the effects of off-exchange trading – including “dark pools”, where orders are matched anonymously – on overall market transparency.
http://jlne.ws/evuixx
BATS Launches Real-Time Latency Monitoring Service Available To Bzx And Byx Exchange Members Tuesday, Feb. 1 And Bats Europe Participants By March 1
KANSAS CITY, Mo., and LONDON – January 31, 2011 – BATS Global Markets (BATS) today announced the release of a real-time latency monitoring service for BATS BZX Exchange and BATS BYX Exchange members effective Tuesday, Feb. 1.
www.batstrading.com
Wells Fargo Joins CME Group for Interest-Rate Swap Clearing
By Matthew Leising
Jan. 31 (Bloomberg) — Wells Fargo & Co.’s securities unit has joined the CME Group Inc. for guaranteeing interest-rate swaps, the firm said today in a statement. Banks will be required to back most of their interest-rate swaps with a clearinghouse beginning this year under the U.S.
Dodd-Frank Act.
Brooksley Born of the FCIC: “We may well still be in a financial crisis”
By: David Dayen
In a sometimes contentious call, Financial Crisis Inquiry Commission representatives Phil Angelides and Brooksley Born acknowledged that we might still be in a financial crisis, and that their report should not be seen as the last word on an event that still has the capacity to significantly damage the global economy.
FDL News Desk
http://jlne.ws/hRlorF
Key GOP lawmakers chide CFTC for “irrational” pace
By Roberta Rampton and Christopher Doering
WASHINGTON (Reuters) – Key House Republicans said the U.S. futures regulator was sacrificing quality for speed as it raced to write dozens of regulations to implement its share of financial reforms.
http://jlne.ws/ify0AQ
Ex-LSE director set to head up new watchdog
Daily Telegraph
A former director at the London Stock Exchange is on the verge of being named as head of the new Consumer Protection and Markets Authority (CPMA), after it is spun out of the Financial Services Authority (FSA).
http://jlne.ws/fgUjQa
Double Secret Strategy: Reform Opponents Trying to Starve Regulators
By Tom Steinert-Threlkeld, Securities Technology Monitor
Commodity Futures Trading Commission member Bart Chilton told insittutional investors Wednesday that opponents of changes wrought by the Dodd-Frank Wall Street Reform Act are trying to block implementation of resulting rules by starving regulators of funding.
http://jlne.ws/feyX4U
Barnier backs caps on commodity traders
By Nikki Tait in Brussels
EU internal market commissioner Michel Barnier reaffirmed his support for the introduction of position limits for traders in commodity markets on Thursday. The commissioner said he was “personally in favour”, noting that the idea is already under consideration in the US. “I don’t see why the US should be more rigorous than we are,” he said.
http://jlne.ws/hEePol
***JM: Ok, psychology for $400, here’s the answer: William H. Whyte in 1952, in Fortune Magazine.
***JM: bzzzt! “Who first coined the term ‘groupthink’, when and where?”
Harmonised accounting rules to hit US banks
By Helen Thomas – Financial Times
US banks could see their balance sheets balloon under new proposals from the accountancy rulemakers that would dramatically reduce their ability to net their derivatives exposure.
http://jlne.ws/dMhP18
IMF contests complacency over euro
By Chris Giles in Davos – Financial Times
John Lipsky, the leading US official at the International Monetary Fund, challenged the air of complacency over the eurozone at the World Economic Forum, telling the Financial Times that the loans to Greece and Ireland had “no guarantee of success” and that restructuring of debt would not be without cost.
http://jlne.ws/hOR6XX
Despite What the Financial Crisis Commission Says, Derivatives Did Not Cause the Crisis
The Atlantic
One of the new report’s most glaring mistakes is to scapegoat these misunderstood financial products
http://jlne.ws/dE3fhe
In Financial Crisis Autopsy Auditors Nowhere To Be Found
Forbes
By now you’ve probably read several reviews and analyses of the Financial Crisis Inquiry Commission
http://jlne.ws/dKMgkc
Words of Remorse at Davos, Sort Of
By KATRIN BENNHOLD – NY Times
DAVOS, Switzerland – “I’m a banker and I feel remorse.”
It wasn’t Jamie Dimon, chief executive of JPMorgan Chase, or Peter Sands from Standard Chartered talking, but Simon Johnson, the former chief economist of the International Monetary Fund and a professor at the M.I.T. Sloan School of Management. “Neither of these statements are true. But I thought you should hear these words at least once at Davos,” he told an audience at the World Economic Forum.
http://jlne.ws/fOPaFv
Some National Carbon Registries May Reopen Within Days, EU Says
Bloomberg
European Union Climate Commissioner Connie Hedegaard said some of the bloc’s carbon registries may reopen within days while others could stay closed for weeks after missing emissions permits forced a security upgrade.
http://jlne.ws/g7yruz
EU expects to begin reopening emissions trading next week
EARTHtimes.org
Brussels – The European Union’s executive expects to begin reopening the bloc’s flagship scheme for trading greenhouse gas emission permits next week, more than two weeks after hackers forced its closure, it was announced on Friday.
http://jlne.ws/g4PbWq
Poland Registry: No ETS Spot Trading For At Least 2 More Weeks
Dow Jones
WARSAW -(Dow Jones)- Poland’s carbon dioxide emissions registry expects spot market allowances trading to remain suspended for at least two more weeks, an official at KASHUE, the country’s registry, told Dow Jones Friday.
http://jlne.ws/frnne4
Lufthansa, Delta Jockey for Free Carbon Permits: Energy Markets
BusinessWeek
The biggest expansion of Europe’s carbon market is pitting Deutsche Lufthansa AG against Japan Airlines Corp. and Delta Air Lines Inc. in a contest for free permits as traders struggle against computer hackers.
http://jlne.ws/eOMzey
CarbonSmart goes up in smoke
Straight Furrow
A PIONEERING attempt to provide landholders with a new income stream through forestry offsets, Landcare CarbonSmart, has fallen foul of the Canberra stalemate over emissions regulation.
http://jlne.ws/f5olsH
What is carbon trading?
Daily Telegraph
Europe has been trading permits to emit carbon dioxide since 2005. The economic concept of the trading scheme is simple but the practice has been fraught with problems.
http://jlne.ws/g04xnw
For more environmental trading news, subscribe to the Environmental Markets version of the John Lothian Newsletter edited by Jim Kharouf.
Visit http://www.jlnenvironmental.com to subscribe.
Exchange & ECN News
Dealers at odds with CME over use of third-party marks
Author: Matt Cameron – Risk Magazine
A split has emerged between CME Clearing and some of its dealer members over the central counterparty’s (CCPs) willingness to consider granting clearing…
http://jlne.ws/gS1taL
CME Group Announces that E-micro Gold Futures Reach Record Volume
Press Release
CHICAGO, January 28, 2011 – CME Group, the world’s leading and most diverse derivatives marketplace, today announced record volume yesterday in its COMEX E-micro Gold futures contract of 2,007 contracts. The prior record was 1,439 on January 20, 2011.
http://jlne.ws/cjpXe7
ICE to Introduce U.K. Natural Gas Options Contract Next Month
Press Release
http://jlne.ws/fTJ8g8
Updates to LSE double in 10 years
By Alistair Gray – Financial Times
Companies have become more willing to issue statements to the stock exchange highlighting recent deals signed with customers, even when such information has only a negligible impact on their financial outlook.
http://jlne.ws/dKgr0r
Nasdaq indices suffer data feed outage
By Telis Demos in New York – Financial Times
Nasdaq OMX said its index data feeds were disabled for an hour early on Friday morning, though trading on the Nasdaq marketplace itself was not disrupted.
http://jlne.ws/ezaZ9f
FWB Exchange Council re-elects Lutz Raettig as chairman
Press Release
Deutsche Boerse: The Exchange Council of the Frankfurt Stock Exchange (Frankfurter Wertpapierboerse – FWB) was reconstituted on 27 January 2011. The members re-elected Dr. Lutz Raettig (Morgan Stanley) as Chairman. His new Vice Chairman is Dr. Werner Brandt (SAP AG).
http://jlne.ws/hEJlip
Exchange Council of Eurex re-elects Gustav Gass as chairman
Press Release
Eurex: At its constituent meeting on Thursday, 27 January 2011, the Exchange Council of Eurex Deutschland re-elected its Chairman as well as the Vice Chairman for a period of three years. Gustav Gass, CEO Gass Capital Markets GmbH, was again appointed as Chairman and Lars Hille, board member of DZ Bank AG, will continue to be Vice Chairman.
http://jlne.ws/efydHO
BM&FBOVESPA: Public Consultation: Notice Of Public Hearing On The Competitive Bidding To Select Market Makers For Equity Options
Press Release
http://jlne.ws/gX6fr4
BM&FBOVESPA: SMAL11 Financial Volume Of BRL24.23 Million Hits New One-Day Record
Press Release
http://jlne.ws/gw9tQM
BM&FBOVESPA Launches Reference Interest Rates For The Fixed-Income Market
Press Release
http://jlne.ws/hzZZ18
First LME steel delivered into new US storage facilities in Chicago
Press Release
The London Metal Exchange’s (LME) new US storage facilities for steel billet saw their first delivery yesterday with 325 tonnes delivered into Chicago.
http://jlne.ws/fHn6Zz
Atrium Network Offers Access To SIX Swiss Exchange
Press Release
Atrium Network, provider of smarter connectivity solutions for the financial community, today announced connectivity to the Zurich-based SIX Swiss Exchange to enable lower latency non-encrypted access for its clients.
http://jlne.ws/hL97K1
Luxembourg Stock Exchange To List First Bond Issued By The European Financial Stability Facility
Press Release
http://jlne.ws/gG2kRa
[CBOE] Trader E-News
Press Release
http://jlne.ws/eCD447
[CBOE] Modifications to Strike Setting Parameters of $1 Strike Program
Press Release
http://jlne.ws/f1phIy
New Version Of The Clearing Rules Of RTS Clearing Center Takes Effect On February 14, 2011
Press Release
http://jlne.ws/ea64id
NYSE LIFFE TO LAUNCH EQUITY OPTIONS ON APERAM
Amsterdam, 31 January 2011 – Today NYSE Liffe, the Europe-based derivatives business of NYSE Euronext (NYX), announced that it will add options on the shares of Aperam (ticker symbol: APAM) to its highly successful range of equity option classes. The launch of these options follows the successful listing of Aperam, the demerged stainless, electrical and specialty steel activities of ArcelorMittal, which took place on January 26. On the same day Aperam was also included in the AEX-index. The Aperam options will be introduced on the Amsterdam derivatives market of NYSE Liffe.
http://www.nyx.com
Banks, Brokers & Dark Pools
Europe’s banks hint at return to health
By David Oakley in London and Ralph Atkins in Frankfurt – Financial Times
Europe’s banking system is returning to health amid signs that financial institutions are no longer hoarding cash, according to key indicators.
http://jlne.ws/fIMK3i
MF Global Declares Quarterly Dividend Payments for Preferred Stock
NEW YORK, Jan 28, 2011 — MF Global Holdings Ltd. (NYSE: MF), a broker-dealer providing trading and hedging solutions, today announced that the company’s board of directors has declared a quarterly dividend on MF Global’s Series A and Series B Preferred Stock.
http://jlne.ws/cto7bF
Goldman execs get big raises. But why?
CNN Money
America’s favorite bankers have outdone themselves yet again. How might you compensate management for a year in which profits plunged , you spent $550 million of shareholder money to settle a fraud investigation and your stock ended up more or less exactly where it started (see chart, right)?
http://jlne.ws/i3SWCd
Goldman’s Blankfein Awarded $12.6 Million in Stock
BusinessWeek
Goldman Sachs Group Inc. gave Chairman and Chief Executive Officer Lloyd Blankfein a $12.6 million stock bonus for 2010, an increase from $9 million in restricted stock a year earlier.
http://jlne.ws/gXLdXx
Citigroup restructuring investment banking operations
PTI via Yahoo! India News
New York, Jan 30 (PTI) Citigroup Inc is restructuring its operations with a view to channelise investment in the energy, power and chemical sectors, according to a media report.Citing a memo the bank sent to employees on Friday, The Wall Street Journal reported that Citi is splitting its energy and power businesses into two separate portfolios, while chemicals will now fall under its global …
http://jlne.ws/dLkVmC
UBS: To Pay CHF16 Million For One-Time Payment To Pensioners
Dow Jones
ZURICH -(Dow Jones)- UBS AG (UBS) said Monday it will charge roughly 16 million Swiss francs ($17 million) against first-quarter earnings in order to pay CHF1,000 each to retired employees in Switzerland.
http://jlne.ws/i8C34h
GIC Plans to Hold on to Citigroup, UBS Stakes for `Many Years,’ Tan Says
Bloomberg
Government of Singapore Investment Corp. , the biggest investor in Citigroup Inc. and UBS AG, plans to hold on to its stakes in the banks for “many years” and will only consider selling if there are attractive offers.
http://jlne.ws/i249vY
Banks keep close eye on Barclays’ cocos plan
By Francesco Guerrera and Patrick Jenkins in Davos and Tom Braithwaite in Washington – Financial Times
Big banks on both sides of the Atlantic are weighing whether to follow Barclays as it pushes ahead with a plan to pay bonuses with innovative bonds, dubbed cocos.
http://jlne.ws/eQwuY9
RBS to push into low-risk retail funds
Independent
Royal Bank of Scotland will today launch a significant push into retail fund management, as it looks to become one of the biggest players in a L40bn market.
http://jlne.ws/gv7VlW
RBS unveils funds that aim to beat volatility
Money Marketing Online
The Royal Bank of Scotland is launching its first two British retail funds to help provide less volatile products for investors.
http://jlne.ws/ha4FTi
Split RBS and NatWest, says architect of banks’ merger
Guardian Unlimited
Royal Bank of Scotland should also sell off insurance business, says Sir George Mathewson Royal Bank of Scotland should be forced to sell off NatWest, according to the bank boss who orchestrated the historic acquisition more than a decade ago . The assertion by Sir George Mathewson, who was chief executive of the Edinburgh-based bank when the hostile takeover of NatWest was launched in 1999, is …
http://jlne.ws/fsmKu6
UK may start selling $73 bln RBS stake in early 2012 – report
Reuters UK Focus via Yahoo! UK & Ireland Finance
LONDON, Jan 31 (Reuters) – Britain could startselling its 46 billion pound ($73 billion) stake in Royal Bankof Scotland early next year, the Financial Times said onMonday citing bosses at the bailed-out …
http://jlne.ws/fb49vu
Chapdelaine Credit Said to Shut as Primus Deal Fails
By Lisa Abramowicz – Bloomberg
Chapdelaine Credit Partners, the bond broker started two years ago when debt markets seized up, will close next week after failing to raise capital, according to people with direct knowledge of the matter.
http://jlne.ws/gd8C87
Mandy helped prepare Barclays boss Bob Diamond for grilling by MPs
Daily Mail
Lord Mandelson gave him informal advice ahead of his appearance before the Treasury select committee earlier this month.
http://jlne.ws/fI65I4
Ex-Lehman COO resurfaces
eFinancial News
The former chief operating officer at Lehman Brothers in Europe who joined Macquarie last March as chief executive of its European business – before leaving just weeks later – has re-emerged at a proprietary trading firm.
http://jlne.ws/gYn1jY
Furry Creatures Explain Bank Bailouts: ‘The Screwing Of The American People’ (VIDEO)
The Huffington Post
In a video exploration of the bank bailouts, two cute creatures decide the bank bailouts amount to “the screwing of the American people.” In the new video, from Omid Malekan , one character asks why the banks were bailed out, and the other responds “Because they said the banks were too big to fail, and if they failed, there would be too many foreclosures, and no new mortgages.”
http://jlne.ws/gy7AaW
Lehman, JPMorgan Aim to Keep Examiner’s Documents Secret in Court Fight
Bloomberg
Lehman Brothers Holdings Inc. and JPMorgan Chase & Co. asked a judge to let them keep secret the documents they subpoenaed from bankruptcy examiner Anton Valukas in their fight over billions of dollars in loans and collateral.
http://jlne.ws/gOhmfG
Irish spread betting firm likely to make loss despite revenue growth
Irish Examiner
WORLDSPREADS, the Irish-founded financial spread betting and online share trading service, has stated that it is likely to make a loss in its current financial year, rather than a profit as initially anticipated.
http://jlne.ws/fMQtDp
Regulatory News
The SEC News Digest
The SEC News Digest provides daily information on recent Commission actions, including enforcement proceedings, rule filings, policy statements, and upcoming Commission meetings.
http://www.sec.gov/news/digest/2011/dig013111.htm
SEC Charges Connecticut-Based Hedge Fund Manager for Fraudulent Misuse of Investor Assets
Press Release
Washington, D.C., Jan. 28, 2011 – The Securities and Exchange Commission today obtained a court order freezing the assets of a Stamford, Conn.-based investment adviser and its principal, Francisco Illarramendi, charging that they misappropriated at least $53 million in investor funds and used the money for self-dealing transactions.
http://jlne.ws/gS9eUH
SEC Institutes Proceedings Against California Attorney for Falsifying Documents for Production to SEC Staff
Press Release
Washington, D.C., Jan. 28, 2011 – The Securities and Exchange Commission today instituted administrative proceedings against a California-based attorney for engaging in improper professional conduct during an SEC examination.
http://jlne.ws/dXIfxA
Judge Freezes Hedge Fund Manager’s Assets
ABC News
Judge freezes hedge fund manager’s assets after SEC says he used $53M for personal gain
http://jlne.ws/hWoGOq
A Fund Manager Ensnared
BY JENNY STRASBURG, MICHAEL ROTHFELD AND SUSAN PULLIAM – WSJ
A former Citigroup Inc. hedge-fund manager has been drawn into the government’s insider-trading investigation as a co-conspirator in the case, and his firm has been raided by Federal Bureau of Investigation agents, according to people familiar with the matter.
http://jlne.ws/erKRxy
Barai Capital hedge fund under U.S. government scanner: report
Reuters.co.uk
(Reuters) – The founder of U.S. hedge fund firm Barai Capital Management has been drawn into the government’s insider trading probe that involves “expert network” firms, the Wall Street Journal said, citing people familiar with the matter.
http://jlne.ws/f5yyxa
Goldman’s Tourre Loses Bid to Delay SEC Case Depositions in U.S.
BusinessWeek
Goldman Sachs Group Inc. trader Fabrice Tourre, accused of misleading investors in a product linked to subprime mortgages, lost a bid to delay U.S. depositions in a Securities and Exchange Commission lawsuit.
http://jlne.ws/glObt6
Married Former Goldman Sachs Trader Pretended He Was Single and Living In London To Dodge $1 Million In Taxes
Business Insider
Derivatives trader Llewellyn Connolly lives in Bond Street in Manhattan with his wife. But that’s not what the Harvard grad told New York City. According to the Daily News (via DB ), he told the city he was single and living in London so he could avoid paying high taxes here.
http://jlne.ws/gsvCrs
Francois de Dietrich sentenced to 18 months imprisonment for failure to comply with Court Order and to cooperate with FSA investigation
Press Release
The High Court in Northern Ireland has committed Francois de Dietrich to an 18 month prison sentence after he failed to comply with a court order obtained by the Financial Services Authority (FSA) and statutory information requests from the FSA ordering him to give, amongst other information, details of where his assets were held.
http://jlne.ws/gzqZ1H
Rajaratnam Prosecutors, Like Quattrone, Want to Show Jury Money
Bloomberg
If the Justice Department has its way, a jury will hear how much money accused insider trading mastermind and billionaire Raj Rajaratnam made and he won’t be allowed to question their motives for prosecuting him.
http://jlne.ws/f9Qlkw
Don’t Be Fooled by Investment Scams For Startups
Business Insider
After you have heard a few startup success stories, like Google, Facebook, and Microsoft, you may be tempted to invest some money yourself, maybe by pooling your funds with other investors who claim to have a great track record.
http://jlne.ws/hJAq3m
BCSC Executive Director’s Bulletin: Securities regulator alleges woman made false or misleading statements
Press Release
Vancouver – The executive director of the British Columbia Securities Commission has issued a notice of hearing alleging that Jo Ann Nuttall made false or misleading statements during an investigation interview.
http://jlne.ws/ePZQ4h
Investments – Indexes – Managed Futures – Managed Funds
John A. Paulson Makes $5 Billion Betting on Gold
New York Times
Mr. Paulson made more in 2010 than he did in 2007 when he bet against subprime investments.
http://jlne.ws/hCndqc
The $5b man: Wall Street’s biggest payday
Business Day
Billionaire hedge fund manager John Paulson, whose bet against the overheated housing market made him one of the world’s wealthiest people, became a lot richer last year, confirming that hedge funds are still Wall Street’s gold mine.
http://jlne.ws/fm7zlr
Litigation fund raises L40m
By Jane Croft, Law Courts Correspondent – Financial Times
A company hoping to cash in on the growing tide of litigation emanating from the credit crunch has raised L40m ($63m) for a Guernsey-based fund that will invest in commercial legal battles and arbitration. Calunius Capital is one of a new breed of so-called litigation funders that provide financing to companies embroiled in disputes that would otherwise struggle to meet spiralling legal bills.
http://jlne.ws/h24DaR
Hedge Funds Get No Love In Davos
Forbes
Banks execs and government officials are taking shots at the “unregulated” hedge fund industry-whic
http://jlne.ws/ggT7mw
With Hire, Man Group Aims to Bolster U.S. Presence
By AZAM AHMED
Man Group, the publicly traded British hedge fund manager, has hired Miriam Tai as head of United States consultant relations, a position meant to bolster the firm’s presence in the United States among institutional investors.
Ex-UBS pair launch wealth management boutique
eFinancial News
Two former UBS private bankers have launched a wealth management boutique, the third time in four years that UBS alumni have set up their their own boutiques.
http://jlne.ws/hEmBy2
FinnCap focus on small companies pays off
By Masa Serdarevic – Financial Times
FinnCap’s strategy of specialising in small Aim-listed companies has been vindicated after the addition of five new clients took it up to second place in a league table of Aim brokers.
http://jlne.ws/fQ952k
Ackermann Says Bailout Risk Lurks for Hedge Funds
BusinessWeek
Deutsche Bank AG Chief Executive Officer Josef Ackermann said unregulated financial companies such as hedge funds may pose a systemic risk to the economy if oversight isn’t increased.
http://jlne.ws/hyHUzb
Forward Management Launches Forward Tactical Enhanced Fund
Business Wire
SAN FRANCISCO–(BUSINESS WIRE)–Forward Management, LLC (“Forward”) today announced the launch of the Forward Tactical Enhanced Fund (FTEEX), a mutual fund that seeks to profit from both up and down market movements through continuous management of market exposure. “We are excited to be launching this new strategy enabling us to build on the success of the Forward Tactical Growth Fund we …
http://jlne.ws/eHIXrw
Groupon financiers sow next online crop
By: Lynne Marek and John Pletz – Crain’s
Even as Groupon Inc.’s original backers tease would-be investors with the prospect of an IPO, they’re wagering on a lengthening list of brand new dot-coms they think could be their next breakaway hits. And they’re doing it in their idiosyncratic way: taking business pitches on napkins or in tweets and writing checks within hours if they’re smitten.
http://jlne.ws/h19GrP
10th Anniversary of ETFs
Press Release
Amsterdam, Brussels, Lisbon, and Paris, 28 January 2011 – NYSE Euronext (NYX) celebrates today the 10th anniversary of ETFs on its European market following the listing of products by iShares and Lyxor in January 2001.
http://jlne.ws/i8RLDE
Web Wealth: Making sense of ETFs
Philly.com
Despite the growth of so-called exchange-traded funds, or ETFs, many investors remain baffled by them. Are they safe? Are they a good alternative to mutual funds? Check these sites for answers.
http://jlne.ws/idUZGn
HSBC launches new China ETF in Europe
Money Observer
HSBC has ushered in the Chinese New Year with the launch of the HSBC MSCI China ETF in Europe. The fund is listed on the London Stock Exchange in sterling and US dollar trading currencies, while further registrations and cross-listings across Europe are planned.
http://jlne.ws/hIQYXK
Want to start a hedge fund?
The Globe and Mail
It turns out getting a fund going in Canada isn’t all that easy, even if you’re a big name on Bay Street
http://jlne.ws/fYQJi1
Reap farm profits without sowing
Chicago Sun-Times
The worst thing about investment advice is that you get it and then realize it’s no good because it’s aimed at people with a lot more zeroes in their free cash account than you possess.I concluded that a couple weeks ago after listening to investment adviser Jim Rogers, in full guru mode, telling a Chicago crowd that the world in the coming century will belong to the producers of goods, not the …
http://jlne.ws/hJlvP4
Hedge Fund Bears Lose on Oil After Egypt Erupts: Energy Markets
BusinessWeek
Hedge funds cut bullish bets on oil last week by the most in two months before political protests erupted in Egypt, igniting a rally that sent prices up by the most since 2009.
http://jlne.ws/hmMb1v
BATS 1000 Index Declines 0.4% On Week
Press Release
http://jlne.ws/gS6o5W
Standard & Poor’s Announces Changes In The S&P/TSX Canadian Indices
Press Release
http://jlne.ws/hTDasS
Standard & Poor’s Announces Changes In The S&P/TSX Venture Composite Index
Press Release
http://jlne.ws/gTKEdn
Technology News
ITRS says it can predict trading breakdowns
By Philip Stafford
The push to assess all potential consequences of trading is set to move into IT infrastructure, with a UK company in the final stages of developing a product to predict breakdowns before they happen. ITRS, a risk monitoring software company, based in the City of London, says it has developed an industry-first tool that can forecast when outages in IT systems are likely to occur, based on the activities of the trading house.
http://jlne.ws/fAr2Pp
***JM: I’m lost. What’s a “breakdown”? Like, computers/networks stop operating? Or something else?
Media News
Twitter tries to turn 140 characters into money
By Jessica Guynn, Los Angeles Times
On “The Tonight Show,” Conan O’Brien used to get big laughs for mocking Twitter as an egotistical stream of mundane updates from celebrities. But when he got bounced from his late-night gig at NBC, O’Brien could no longer take to the airwaves to reach his fans, so Twitter became his open hailing frequency. He later thanked Twitter “for saving my ass.”
http://jlne.ws/ghzyTZ
Define Gender Gap? Look Up Wikipedia’s Contributor List
By NOAM COHEN – NY Times
In 10 short years, Wikipedia has accomplished some remarkable goals. More than 3.5 million articles in English? Done. More than 250 languages? Sure. But another number has proved to be an intractable obstacle for the online encyclopedia: surveys suggest that less than 15 percent of its hundreds of thousands of contributors are women.
http://jlne.ws/fA1QSZ
Reports
Briefing.com Economic Calendar
http://www.briefing.com/Investor/Public/MarketAnalysis/Calendars/EconomicCalendar.htm
USDA Today
http://www.nass.usda.gov/Publications/index.asp
CBOE Events Calendar
http://www.cboe.com/AboutCBOE/EventCalendar.aspx
Economic Release Calendar
The Economic Release Calendar (PDF) is a schedule of government, academic and industry economic releases, provided as a service to CME customers.
http://www.cmegroup.com/tools-information/calendars/
Asia-Pacific News
China To Allow Corporate Currency Swaps March 1
FOX Business
SYDNEY — China will allow some banks to conduct yuan, foreign-currency swaps on behalf of clients, beginning March 1, according to reports from the region Monday. The move is designed to extend financial derivatives beyond the interbank market in China, the reports said. Banks that have been approved for a year to issue foreign-currency swaps will be able to issue further swaps without extra …
http://jlne.ws/fTNV5N
Eastday-Yuan trade barriers coming down
Eastday.com
BEIJING – Zhou Xiaochuan, China’s central bank governor, pledged to remove domestic policy barriers to promote the yuan’s use in cross-border trade settlements and outward investments by Chinese enterprises.
http://jlne.ws/gbjccK
Chinese Banks on the Prowl in Europe
By DAVID ENRICH, JASON DEAN and LAURA STEVENS – WSJ
Chinese financial institutions are pushing into Europe, opening bank branches, scouting for deal opportunities and even attending German banking classes, in the latest illustration of China’s growing global economic clout.
http://jlne.ws/epkfDW
China Should Buy More Gold, Silver for Reserves, Daily Reports
Bloomberg
China should increase its gold and silver reserves, the Economic Information Daily reported today, citing an interview with central bank adviser Xia Bin .
http://jlne.ws/e3fdCa
Morgan Stanley Invents A Clever Way To Invest In China
Forbes
There is no limit to Wall Street’s ingenuity– especially when a brand new exciting opportunity presents itself to profit in the most dynamic of all the emerging markets, China.
http://jlne.ws/fFNzuF
Tokyo Grain Exchange Maximum Rate For Additional Discharging Ports Charges
Press Release
http://jlne.ws/ggDm2r
Tokyo Stock Exchange Group Announces Financial Report For The Nine-Month Period Ended 31 December, 2010
Press Release
http://jlne.ws/frr79c
Frontier Markets
NCDEX relaunches rubber futures
Business Standard India
National Commodity & Derivatives Exchange Limited (NCDEX) is re-launching its rubber futures from January 31, with chan-ges considering market de-mand and feedback. The contract size will be 1 metric tonnne (MT) and the unit of price quotation will be in Rupees per Quintal. The tick size will be Rs 10. The basis centre is Kochi with additional delivery centres at Kottayam, Kozhikode, Thrissur …
http://jlne.ws/hnr1D1
Bank Of America Merrill Lynch Joins NASDAQ Dubai’s Equity Derivatives Market
Press Release
Bank of America Merrill Lynch has joined NASDAQ Dubai’s equity derivatives market as its first General Clearing Member (GCM). This enables Bank of America Merrill Lynch to clear the trades of other brokers as well as its own, injecting liquidity into the fledgling market.
http://jlne.ws/h43i7V
ICEX Launches Iron Ore Futures Contract On Saturday, January 29
Press Release
Mumbai based Indian Commodity Exchange (ICEX) has received permission from Forward Markets Commission (FMC), commodity futures market regulator, to commence futures trading in Iron Ore Futures (IOF) contracts on January 29, 2011.
http://jlne.ws/gZ9uRS
Indian Commodity Exchange Successfully Launches World’s First Iron Ore Contract
Press Release
Mumbai based Indian Commodity Exchange (ICEX) on Saturday successfully launched world’s first iron ore futures contract. ICEX Iron ore March 2011contract prices were up 1.20% to trade at Rs 8,069 per tonne while April 2011 contracts also traded at Rs 7,628 per tonne.
http://jlne.ws/dLusUD
HSBC payments division wins three awards
Gulf Times
HSBC’s payments and cash management (PCM) division has bagged three awards for its outreach into the Middle East and North Africa region.
http://jlne.ws/a4zpTY
BFX set to put the Middle East on world’s financial services radar
Zawya
JEDDAH: The launch of the Bahrain Financial Exchange Bahrain Financial Exchange ( BFX BFX ) on Feb. 7 is set to reinforce the position of the Middle East region on the world’s financial services radar. The exchange, once operational, will help bring back liquidity into the region.
http://jlne.ws/i2JfXo
Islamic banking gaining foothold in Nigeria
MENAFN
http://jlne.ws/hx3cvf
Tread carefully when investing in developing countries
The Globe and Mail
Overall economic growth doesn’t always lead to rising stock markets, and political, social and economic problems can take their toll
http://jlne.ws/huBv5F
Region expects flurry of fundraising in 2011
Zawya
Dubai: The Gulf region is expected to witness a flurry of activity in fundraising this year by both government related entities and corporates and refinancing debt will not be a big problem for many of these entities, David Karsbol, chief economist at Saxo Bank Saxo Bank , told Gulf News in an interview.
http://jlne.ws/fTI54p
Morgan Stanley fund to invest $200-M in India infrastructure
ABS-CBNNEWS.com
MUMBAI – Morgan Stanley’s Global Infrastructure Fund will invest $200 million for an equity stake in the Indian arm of privately held Spanish construction firm Isolux Corsan, the Economic Times newspaper said in a report on Saturday.
http://jlne.ws/eZngzL
RBS coutts furthers nri initiative in the Middle East with key appointment
Zawya
Dubai, 31 January 2011 – RBS Coutts, the international private banking arm of the Royal Bank of Scotland Group, today announced the appointment of Santosh Keni as Head of the Non-Resident Indian (NRI) and South Asia business in the Middle East.
http://jlne.ws/fdcPQk
Weekend Investor: How to profit from consumers in emerging markets
Market Watch
The rise of emerging market consumers, with their young populations and higher disposable incomes and spending, has contributed mightily to growth China, India, Brazil and other developing economies. Now the consumer in these fast-growing regions has been knocked off the shelf.
http://jlne.ws/hlRPo1
Egyptian Bourse, Banks Will Be Closed Today, State TV Reports
BusinessWeek
The Egyptian bourse will be closed today following clashes yesterday between thousands of protestors and police in central Cairo, the fifth day of unrest. Banks also will be shut, State TV said.
http://jlne.ws/eX6DmJ
Dubai Gold & Commodities Exchange Weekly Market Commentary – January 30, 2011
Press Release
http://jlne.ws/hAONsN
Malawi Stock Exchange Weekly Report – 28 January 2011
Press Release
http://jlne.ws/gNc2VU
Miscellaneous News
A good employer offers more than Botox
By Lucy Kellaway – Financial Times
Last week, Fortune magazine published its latest survey of the 100 best companies to work for in the US. As I have never worked at any of them I can’t offer first hand corroboration of the rankings – though in 1981 I did try to get a job at Boston Consulting Group (rated number two in the Fortune list), but was rejected after letting slip in an interview that I had no idea what a learning curve was.
http://jlne.ws/gig4Jb
Economic growth is not a race to the moon
By Clive Crook – Financial Times
My first take on Barack Obama’s State of the Union address was to find it disappointing. The US president missed the perfect opportunity, I thought, to prepare the US for the fiscal squeeze that must come. Having read the speech more carefully, I feel I was unfair. I was too kind.
http://jlne.ws/grhI41
SIFMA Issues Quarterly Government Securities Issuance And Rates Forecast
Press Release
SIFMA today issued its quarterly government securities issuance and rates forecast for the first quarter of 2011.
http://jlne.ws/elgC4E
Commodity prices and speculation, again
From: Greed, Green and Grains
The other week I got a list of questions from a journalist at China’s Life Week, which is presumably the country’s biggest news magazine.
http://jlne.ws/ebnBfp
