| October 06, 2016 | "Irreverent, but never irrelevant" | | | | John Lothian
Publisher
John Lothian News | |
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CHX: Ownership Matters
By John Lothian
Chicago Stock Exchange Seeks Transformation in New Owners and Trading Processes
With over 50 venues in the U.S. to execute trading of shares of stock, the Chicago Stock Exchange ("CHX") unfortunately only stands out for its being overlooked. Its management seeks to change that with an ownership overhaul, trading technology process innovations and a push back into listings that could attract Chinese companies, among others.
Like a little brother who gets forgotten in a big family, CHX is fighting for attention with its plans. Many of its current owners have stakes in other trading venues that bring higher margins to them than CHX, which means the exchange is not the first, second or third choice in many instances for where their owners want to send equities order flow. To solve that issue, CHX has found a new ownership group and engineered a pending sale.
It is not a sale to CHX's Chicago neighbor, the CME Group, which stand firmly committed to staying out of the equity trading business. Instead, the sale involves a Chinese led group, the Chongqing Casin Enterprise Group.
For the rest of the story, click here
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Bob Otter - 40 Years in Futures
MarketsWikiEducation.com
From humble beginnings as a runner during high school, Bob Otter became a futures industry tale of success. He told John Lothian News about what was lost and what was gained when exchanges went all electronic, as well as the lessons he learned. His career began the way many do, with a local connection.
Watch the video »
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CBOE Acquisition of Bats Should Be a Home Run; Wells Fargo upgrades CBOE stock to Outperform and jacks up its price target range.
By Wells Fargo Securities
We are upgrading CBOE (ticker: CBOE) to Outperform from Market Perform on the view that the acquisition of Bats will create considerable shareholder value. We see the stock working as investors appreciate the accretion to earnings per share (25%-plus in our view) along with the more diverse potential upside optionality in the combined businesses. There has been some price/earnings dilution for legacy CBOE, but we think that is now largely played out setting up for a nice risk-reward. No change to our 2016E/ 2017E/ 2018E EPS of $2.37/ $2.70/ $2.95, but we note these do not include the Bats acquisition. We are raising our valuation range to $78-$83 from $65-$70, which is based on a 22 times multiple on our 2018E earnings per share pro forma for Bats ($3.60).
/goo.gl/CJPxXW
**JK: Get ready for more baseball references. If the deal isn't a home run, would you settle for a triple?
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Perseus Allows Global Markets to Communicate Faster and More Securely
Institutional Investor
jlne.ws/2dLgUTB
**An interview with Jock Percy of Perseus.
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Listen to Wu-Tang: The fundamentalz of financial analysis, according to rappers
Jason Karaian - Quartz
The making and spending of money is a preoccupation of many hip-hop artists. (They're quite good at it, too.) It follows, then, that professional financial analysts could learn a thing or two by studying their priorities.
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****JB: I always got a kick out of this picture of P. Diddy counting through a stack of $100 bills and looking puzzled at the $1 bill he found.
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UMass economist rebuts Mankiw paper on income inequality
Rachel Butt - Business Insider
Three years ago, Harvard University economist  and Mitt Romney advisor  Gregory Mankiw stirred things up with a paper in defense of the 1%. Basically, Mankiw said the rich deserve to be rich because they contribute more to society  not because they're gaming the system. Inequality is a product of invention and creativity, such as Steve Jobs' iPod and J.K. Rowling's Harry Potter books. Naturally, the paper was met with a strong response from a range of dissenters including (predictably) Paul Krugman, and (maybe less predictably) the Economist magazine. But if you thought the discussion was over, then you don't understand economists, or academics.
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****JB: I am wondering what it is that Trump has contributed to society to make him deserve his fortune. Somehow I do not think "The Apprentice" or Trump Steaks meet muster.
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The Overlords Of Finance
By Danielle DiMartino - ValueWalk
An Insider's Take on the Willful Ignorance and Elitism At the Federal Reserve
It was the best of times. And it still is. Intrepid investors who never dreamed they'd put all of their eggs in one full-boar risk asset basket have never had it so good. Stocks are up, bonds are up, emerging markets are up, real estate is up. Heck, it's all up. As it should well be. It's different this time. No, really. It is.
/goo.gl/m83eXw
**JK: This title sounds like a great new action video game.
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Old Master market reels from Sotheby's fake assessment; Auction house says £8.4m Frans Hals painting is a forgery
by: James Pickford and Josh Spero - FT
A painting sold by Sotheby's as the work of Dutch artist Frans Hals for £8.4m has been reassessed by the auction house as fake, triggering fears that more multimillion dollar Old Master works will be exposed as the work of a highly skilled forger.
/goo.gl/UyeJ7I
**JK: Just shocking, shocking that we have forgers in the art world.
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Wednesday's Top Three
There are times when getting denied is a good thing. Such is the case in DRW's court battle with the CFTC; our top two stories were from The Wall Street Journal, In Market-Manipulation Brawl, CFTC Loses Round One and Crain's Chicago Business' Another step toward trial for DRW Holdings in market manipulation case. We can't get enough law and order as the third spot went to Bloomberg's piece CFTC, Oystacher Said to Be in Spoofing Case Settlement Talks
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| Lead Stories | Three Risks to the Global Financial System as Debt Hits Record Levels; IMF urges major restructuring of the European banking system and sees emerging-market corporate defaults on the rise
By IAN TALLEY - WSJ
In recent years, the global financial system has weathered Brexit, China's deceleration and emerging market mayhem.
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Understanding Deutsche Bank's $47 Trillion Derivatives Book; Size of figure can be misleading, but some of those assets are hard to value, stoking concern among investors
By MIKE BIRD - WSJ
Shares in Deutsche Bank AG have fallen by more than 48% this year amid concerns that the lender faces a hefty fine from the Justice Department and as its core lending business suffers from low interest rates and weak economic growth.
/goo.gl/8VZqL5
ICAP's future reflects derivatives market in transition; A clubby world transformed by a mix of heavy regulation, poor industry economics and technology
by: Philip Stafford - FT
Only hours after the UK has decided to leave the EU and voice brokers in ICAP's London office are bellowing orders and looking to close deals on behalf of bank traders.
/goo.gl/KyN3ZK
How the owners of Fidelity get richer at everyday investors' expense
Tim McLaughlin - Reuters
The mutual fund giant Fidelity Investments, founded seven decades ago and run ever since by the Johnson family, has won the trust of tens of millions of investors. The company's tradition of putting clients' interests "before our own is a big part of what makes Fidelity special," the fund firm says in its mission statement. In at least one lucrative field, however, the Johnson family's interests come first. A private venture capital arm run on behalf of the Johnsons, F-Prime Capital Partners, competes directly with the stable of Fidelity mutual funds in which the public invests. It's an arrangement that securities lawyers say poses an unusual conflict of interest.
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EU Financial-Transaction Tax Set for Showdown in Luxembourg
Alexander Weber - Bloomberg
The 10 European Union countries pursuing a financial transaction tax meet in Luxembourg on Monday, trying to break a stalemate on the levy first proposed five years ago.
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World debt hits $152tn record, says IMF; Calculation of burden highlights challenge of boosting growth
by: Claire Jones in Washington - FT
The world is $152tn in the red  a record-breaking level of debt, according to the International Monetary Fund.
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IMF urges governments to tackle record global debt of $152tn
Larry Elliott - The Guardian
The International Monetary Fund has urged governments to take action to tackle a record $152tn debt mountain before it triggers a fresh global financial and economic crisis. Warning that debt levels were not just high but rising, the IMF said it was vital to intervene early in order to mitigate the risks of a repeat of the damaging events that began with the collapse of the US sub-prime housing bubble almost a decade ago.
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Queue Position And Algo Slices: Like Taking Candy From A Child (Order)
Global Trading
Every buy-side trader has been there. You see the bid, you try to hit it and it disappears in front of you. Haim Bodek explains how it's done. High frequency trading (HFT) strategies modelled on the Chicago Futures pits and enabled by bespoke order types allow firms using them to exit trades moving against them and rejoin the queue at the top to wait for favourable market conditions. And the key to the whole strategy? A ready supply of orders behind them in the queue - child orders created by the slicing algos used to execute many buy-side orders.
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When Globalization Eats Its Young
Harold James - Project Syndicate
Evidence that globalization is reversing continues to pile up: trade and international capital flows are sluggish, and migration is increasingly being restricted. These trends emerged in the aftermath of the 2008 financial crisis, so they can't be blamed on a new populist backlash against globalization. Rather, their source can be traced to national authorities' failure to take the logic of globalization seriously.
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A civil war in the banking industry
By: Nick O'Connor - MoneyWeek
The interests of the world's central banks and commercial banks have been aligned since the financial crisis. Central banks looked after their commercial counterparts by making it easy for them to rebuild their balance sheets after Lehman Brothers went bust by keeping interest rates low and reflating the financial system with lots of quantitative easing (QE). All good for banks, if not for savers.
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ETF price war escalates as BlackRock fires broadside at rivals; World's largest fund manager cuts fees to attract more interest from US pension advisers
by: Chris Flood - FT
The cut-throat price war between exchange traded fund providers in the US escalated on Wednesday after BlackRock fired another broadside at rival managers by reducing fees across its core iShares ETF range.
/goo.gl/iAmk4M
Hedge funds: Brevan Howard comes up short; Stellar returns helped make hedge fund and its $3tn industry but the future looks uncertain
by: Lindsay Fortado and Miles Johnson - FT
Brexit offered the tantalising prospect of a comeback for billionaire hedge fund founder Alan Howard.
/goo.gl/LjkE68
Berlin pursues discreet talks with U.S. officials on Deutsche Bank
Reuters
The German government is pursuing discreet talks with U.S. authorities to help Deutsche Bank (DBKGn.DE) secure a swift settlement over the sale of toxic mortgage bonds, according to sources in Berlin.
/goo.gl/VB7ASe
EU's Clearinghouse Plan: The New Too-Big-to-Fail
Bloomberg
The European Union has plans to prevent failure in derivatives clearinghouses, looking to head off potential havoc in the financial system. Bloomberg's John Glover reports on "Bloomberg Markets."
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Deutsche Bank is latest victim of America's Treasury war
BEN WRIGHT - Telegraph
António Horta Osório, the chief executive of Lloyds Bank has read it; Peter Sands, the former chief executive of Standard Chartered, has most certainly read it; and Stuart Gulliver, the chief executive of HSBC, thought so much of the book that he hired its author. I suspect there isn't a bedside table of a single European bank executive worth their salt that has not been graced by a copy of Treasury's War by Juan Zarate.
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| Brexit | | Financials stories regarding the recent decision of the United Kingdom to leave the European Union | Angela Merkel urges German firms to back tough stance in Brexit talks
Jon Henley and Philip Oltermann - The Guardian
Angela Merkel has significantly stiffened her rhetoric on Brexit, telling an audience of German business leaders that any exception to the EU's single market rules would represent "a systemic challenge for the entire European Union".
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Bank of England was too pessimistic about Brexit vote - deputy governor
Angela Monaghan - The Guardian
Bank of England deputy governor Ben Broadbent has said policymakers had been too pessimistic about the immediate aftermath of the Brexit vote, but warned of an "insidious" threat to business investment. "There's little doubt that the economy has performed better than surveys suggested immediately after the referendum and ... somewhat more strongly than our near-term forecasts as well," Broadbent said in a speech at the Wall Street Journal's offices in London.
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| Exchanges, OTC & Clearing | | Top news from exchanges, clearing, settlement and trade execution facilities | Bats Announces Successful Migration of BZX Options Exchange to Next-Generation Matching Engine
Bats Global Markets
Bats Global Markets, Inc. (Bats: BATS), today announced the successful migration of its largest options exchange, BZX Options, to the company's proprietary next- generation matching engine.
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BSE pins hope on international bourse for derivatives push
Business Standard News
BSE, Asia's oldest stock exchange, is pinning its hopes on its upcoming international exchange to get a toehold in the equity derivatives segment. The exchange will be banking on various tax sops given by the government, including exemptions from stamp duty, as well as commodity and securities transactions tax (STT), to attract market participants.
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Sebi renews licence of BSE's clearing corp for one year
Business Standard News
Indian Clearing Corporation Ltd (ICCL), an arm of BSE, has been granted renewal of recognition by the regulator Sebi for a period of one year. The one-year licence to ICCL is valid from October 3, this year.
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Tradeweb U.S. ETF Trading Volume Surpasses $12 Billion Year-to-date
Tradeweb
Tradeweb Markets, a leading builder and operator of global fixed income, derivatives and ETF marketplaces, announced that more than $12 billion notional volume has traded year-to-date on its electronic request for quote (RFQ) platform for U.S. ETFs since launching in Q1 2016. Now with 18 market makers trading with more than 135 clients, the platform is demonstrating valuable access to institutional-sized liquidity with average trade size exceeding 135,000 shares in Q3.
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Nasdaq Holds Third Quarter 2016 Investor Conference Call
Press Release
Nasdaq (NASDAQ:NDAQ) has scheduled its Third Quarter 2016 results announcement.
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Women's Exchange Celebrates its 4th Anniversary
HKEX
Hong Kong Exchanges and Clearing Limited's (HKEX) Women's Exchange celebrated its fourth anniversary at its annual reception last night (Wednesday).
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ASX GROUP MONTHLY ACTIVITY REPORT - SEPTEMBER 2016
ASX
The value of ASX-listed stocks, as measured by the All Ordinaries Index, fell 0.1% in September 2016. This performance was in contrast to some major markets, including the UK up 1.7%, Singapore up 1.7% and Hong Kong up 1.4%. Declines were also observed in Japan down 2.6%, Germany down 0.8% and the US down 0.1%.
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TMX Group Limited announces release date for Q3 2016 financial results and analyst conference call
TMX
TMX Group Limited will announce its financial results for the third quarter ended September 30, 2016 in the evening of Thursday, November 3, 2016. An analyst conference call to review the results will be held on Friday, November 4, 2016 at 8:00 a.m. ET.
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TSX NAVex Signs on Mutual Fund Provider; Toronto Stock Exchange's new mutual fund solution continues to build on industry momentum
TMX
TSX NAVex, Toronto Stock Exchange's unique centralized mutual fund solution, today announced the addition of Excel Funds Management Inc. (Excel Funds) and its mutual fund strategies to the platform. Eight Excel Funds strategies, including its flagship Excel India Fund, the largest and longest-running India-focused mutual fund in Canada, are expected to be available on the platform in the coming weeks.
/goo.gl/ieMbi2
TMX Group Consolidated Trading Statistics
Press Release
TMX Group Limited today announced September 2016 trading statistics for its marketplaces - Toronto Stock Exchange, TSX Venture Exchange, TSX Alpha Exchange (Alpha), Montréal Exchange (MX) and NGX.
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NSE gets board nod to launch IPO via OFS, clears bonus shares; It will file draft IPO papers with the Sebi for the domestic public issue by January 2017
Business Standard
Ahead of its much-awaited initial public offering (IPO), the National Stock Exchange's board has decided that the public issue will be in the form of an offer for sale by shareholders while the directors have approved issuance of bonus shares, stock split and a dividend payout for the existing investors.
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NSE moves to make systems tamper-proof; The bourse is implementing 11 'pan-organisation' measures to strengthen its IT infrastructure as Sebi initiates an independent audit of its systems
N Sundaresha Subramanian
The National Stock Exchange (NSE) is undertaking major initiatives to boost its information security following recommendations by a third party auditor from Israel. While the bourse has already implemented several suggestions, as many as 11 other measures have been taken up as separate projects and are in various stages of implementation. "Out of the 152 recommendations, 141 have been closed. The remaining 11 open items are large pan-organisation initiatives and will be completed as separate projects," the NSE annual report for the year that ended on March 2016 said. ...
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| Politics | | An overview of politics during an election year as it relates to the financial markets | Wall Street Might Have a Blind Spot When It Comes to Trump
Sangwon Yoon - Bloomberg
Markets inefficient at pricing in unexpected political events; High voter distrust risks surprise U.S. election outcome
Minutes into last week's presidential debate, investors decided that Donald Trump, a candidate many of them fear, was being outshone by Hillary Clinton. This, they figured, would help stem his momentum, and so they frantically bid up the value of the Mexican peso, a currency that has become an election barometer. The next day, the S&P 500 Index jumped 0.6 percent.
/goo.gl/wRfzfQ
Xi Jinping May Delay Picking China's Next Leader, Stoking Speculation
Chris Buckley - NY Times
The Chinese president, Xi Jinping, appears prepared to defy the Communist Party's established script for transferring power and delay the designation of his successor until after a party congress next year, unsettling the party elite and stirring speculation that he wants to prolong his tenure.
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| Investing & Trading | | Today's top stories from fixed income, currencies and commodities (FICC) | 'Fiduciary rule' may create a $10 trillion exchange-traded behemoth by 2020
By Ryan Vlastelica - MarketWatch
The Labor Department's "fiduciary rule" was designed to help retirement savers, but one of the biggest beneficiaries might be exchange-traded products, including ETFs and ETNs.
/goo.gl/X2sZl4
Commodities to struggle to regain stance in portfolios: JPM
Eric Onstad - Reuters
Commodities will battle to regain a prized place in many portfolios after the "super cycle" fizzled out and in a world of muted global growth, executives at JP Morgan Asset Management said. The sector could, however, claw back a shred of its former glory by providing some diversification benefits, they said during a conference by the fund manager in London this week.
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Jamie Dimon Made One of the Year's Best Trades
Julie Verhage - Bloomberg
It was perfectly timed. Back on February 11 of this year, Jamie Dimon, the Chairman and Chief Executive Officer of JPMorgan Chase & Co., made a highly publicized purchase of 500,000 shares of his own company's stock, worth about $26.6 million at the time. The stock ended up hitting a bottom that day and has surged more than 25 percent since then.
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Companies Keep Increasing Dividends, But Momentum Fades
Ben Eisen - WSJ
The value of dividends paid out by U.S. companies increased in the third quarter by $6 billion, a sign that firms are still increasing payments to shareholders, but not by as much. A total of 427 companies raised their dividends by $9.1 billion last quarter, down from 497 during the third quarter of 2015, according to S&P [...]
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Rieger Report: "Belly of the Curve" Good for Muni & Corporate Bonds
J.R. Rieger - S&P Indexology
Through October 3rd, the S&P Municipal Bond Index has returned 4.23% year-to-date and the S&P 500 Bond Index has returned 8.97%. The 7 - 10 year maturity range has outpaced the overall benchmarks in both cases.
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Harvard Borrows Big to Cut Cost of Crisis-Era Derivative Losses
Amanda Albright, Michael McDonald - Bloomberg
University paid more than $1.25 billion to break swap deals; With interest rates low, it's refinancing $2.5 billion of debt
Harvard University is cutting the tab left by one legacy it'd rather forget.
/goo.gl/bE87jJ
The Most Overlooked Trait of Investing Success
by Morgan Housel - Collaborative Fund
I once asked a doctor: What's the hardest part of your job?
It wasn't the stress or responsibility. It was so basic. "Getting my patients to do what I ask of them," she said.
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| Banks, Brokers & Managed Funds | | The latest from banks, brokers, hedge funds and managed futures | Deutsche Bank's $14 Billion Scare
Tom Schoenberg, David McLaughlin - Bloomberg
Justice officials had envisioned $3 billion mortgage penalty; U.S. added prosecutors and gave RMBS cases a new overseer
This summer, U.S. Justice Department officials working on a mortgage securities investigation of Deutsche Bank AG expected the bank to settle the matter for $2 billion to $3 billion, according to people with knowledge of the matter.
/goo.gl/D1f9UP
The secret pay packages of Fidelity's star stock pickers
Tim McLaughlin - Reuters
One of the best kept secrets in the mutual fund industry is the compensation of portfolio managers who oversee trillions of dollars in retirement assets. The SEC does not require any detailed disclosure.
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Central Bankers on QE Highway Worry About Running Out of Road
Enda Curran - Bloomberg
Two of the world's most accommodative central banks are starting to think about ways out of the bond-buying maze.
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ICAP's future reflects derivatives market in transition
Philip Stafford - Financial Times
Only hours after the UK has decided to leave the EU and voice brokers in ICAP's London office are bellowing orders and looking to close deals on behalf of bank traders. From behind the ranks of massed computer screens, on the European interest rate swaps desk a broker shoots up from his chair and hollers the near-incomprehensible price of a swap: "10-year 6s" to his colleagues around him. Surrounded by a mass of screens and flashing lights, they in turn mumble the price into phones glued to their ears, like a classroom reciting lines after a teacher, as they relay the offer to traders at banks.
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ETF price war escalates as BlackRock fires broadside at rivals
Chris Flood - Financial Times
The cut-throat price war between exchange traded fund providers in the US escalated on Wednesday after BlackRock fired another broadside at rival managers by reducing fees across its core iShares ETF range. The world's largest fund manager cut expense ratios on 15 US-listed iShares ETFs by up to 5 basis points, reducing annual fees to between 4 and 14bp from a previous range of 7 to 16bp.
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Berlin pursues discreet talks with U.S. officials on Deutsche Bank
Paul Carrel and Noah Barkin - Reuters
The German government is pursuing discreet talks with U.S. authorities to help Deutsche Bank (DBKGn.DE) secure a swift settlement over the sale of toxic mortgage bonds, according to sources in Berlin. Until now, German officials have played down their role in the standoff, saying it is up to Deutsche to work out a deal with the U.S. Department of Justice (DOJ), which is demanding up to $14 billion to settle claims the lender mis-sold mortgage-backed securities before the financial crisis. But government officials in Berlin, speaking on condition of anonymity, told Reuters they hoped to facilitate a quick deal that would buy Deutsche Bank time to regain its footing.
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Deutsche Bank must convince investors its business model is viable: IMF
Reuters
Deutsche Bank needs to convince investors that its business model is viable, a senior International Monetary Fund official said on Wednesday amid concerns about the bank's financial strength.
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Deutsche Bank Mismarked 37 Deals Like Paschi's, Audit Says
Vernon Silver, Elisa Martinuzzi, Donal Griffin - Bloomberg
Deutsche Bank AG, indicted for colluding with Banca Monte dei Paschi di Siena SpA to conceal the Italian lender's losses, mismarked the transaction and dozens of others on its own books, according to an audit commissioned by Germany's regulator.
/goo.gl/BiWxU8
Brevan Howard founder says fund will stay open despite losses
Lindsay Fortado and Miles Johnson - Financial Times
The billionaire founder of one of Europe's largest hedge funds says he will "absolutely not" follow in the footsteps of his rivals and shut Brevan Howard to the public, despite several years of losses and investors pulling their cash.
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Central-bank gold purchases expected to stay muted, Citi says
Akin Oyedele - Business Insider
Central banks are among the largest buyers of gold, but they've retreated from the market in 2016. Only Russia, China, and Kazakhstan have increased their gold reserves so far this year, according to Citi Analyst Nell Agate.
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Goldman Employees to Pull $300 Million From Omega Advisors
Dakin Campbell, Katherine Burton, Saijel Kishan - Bloomberg
Follows insider trading charges against Omega's Leon Cooperman; Bank retirement plan also liquidated fund managed by Och-Ziff
Goldman Sachs Group Inc.'s retirement plan is pulling about $300 million from Leon Cooperman's Omega Advisors Inc., marking the second time this year it's cutting ties with a famous alum who ran afoul of U.S. authorities.
/goo.gl/mBX3ix
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| Fintech | | A roundup of today's market tech news and a look at tomorrow's disruptors | Fidessa voted Trading System of the Year in FOW's Asia Awards
Fidessa
Fidessa group plc (LSE: FDSA) has today announced that its derivatives trading platform has been named Sell-side Trading System of the Year at the FOW Awards for Asia 2016. Judged by an independent panel of industry experts from a range of disciplines across the region, these awards recognise leadership, growth and achievement in the Asian derivatives marketplace. This is the fourth year running that Fidessa's platform has been recognised in these awards as the leading trading system in Asia.
jlne.ws/2dLVeH3
Blockchain heavyweights meet in Brussels for intellectual property workshop
Ian Allison - Yahoo
A group of blockchain experts and enthusiasts met under the auspices of the EU in Brussels for a two-day workshop about how blockchain can protect and enforce intellectual property.
/goo.gl/bAHgL6
JPMorgan is developing a new blockchain project
BI Intelligence
JPMorgan Chase is working with Ethereum startup EthLab on a new blockchain project called Quorum, the Wall Street Journal and CoinDesk report.
/goo.gl/FL4TAc
TOCOM New Trading System Successfully Launched on September 20
September Volume Averaged 85,496 Contracts per Day, Down 3.7%, while Open Interest Continues to Expand Recording 9-Year-High
Press release Oct. 5
The Tokyo Commodity Exchange announced today that average daily volume for September 2016 was 85,496 contracts, down 3.7% month-over-month. Volume for TOCOM's largest contracts was mixed; Dubai Crude Oil was up 5.5% to 19,849 contracts and Rubber was up 6.4% to 6,567 contracts while Gold Standard decreased 13.7% to 24,608 contracts.
TOCOM Dubai Crude Oil traded heavily on speculation that OPEC would adopt a production freeze to curb worldwide supply.
/goo.gl/mcyAlu
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| Regulation & Enforcement | | For more regulatory, visit MarketsReformWiki, our website focused on current market reform efforts. | Supreme Court Appears Skeptical of Radically Altering Insider-Trading Rules
Aruna Viswanatha - WSJ
Supreme Court justices appeared skeptical Wednesday of overhauling insider trading rules in a closely watched case that could alter the scope of what amounts to illegal securities trading. The case, Salman v. U.S., raises the question of whether trading activity is considered "insider trading" if the person who initially shared a secret tip didn't receive a benefit for providing it.
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U.S. top court leans toward making insider trading prosecutions easier
Nate Raymond - Reuters
U.S. Supreme Court justices hearing a closely watched insider trading case indicated on Wednesday they were likely to make it easier for prosecutors to pursue such charges against traders, but questioned where to draw the line. The appeal by Bassam Salman, an Illinois man convicted after making nearly $1.2 million trading on information that came from his brother-in-law, was the first insider trading case to come before the justices in two decades.
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Credit Suisse Paying $90 Million Penalty for Misrepresenting Performance Metric
SEC
The Securities and Exchange Commission today announced that Credit Suisse AG has agreed to pay a $90 million penalty and admit wrongdoing to settle charges that it misrepresented how it determined a key performance metric of its wealth management business.
/goo.gl/rys3D2
Credit Suisse to Pay $90 Million for Padding Private Assets
Matt Robinson - Bloomberg
Credit Suisse Group AG agreed to pay a $90 million penalty to settle U.S. Securities and Exchange Commission claims that the bank misrepresented how much money it attracted to its private bank.
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What's So Wrong With Insider Trading Anyway?
Amelia Thomson-DeVeaux - FiveThirtyEight
An investment banker passes along a tip to his brother about upcoming mergers involving his bank's clients. The brother slips the tip to his brother-in-law, who uses the information to make more than $1 million from trading he did ahead of the deals. There's no evidence that the banker received compensation for leaking the information, other than possibly some warm fuzzies for helping a family member make a lot of money. Is their family relationship enough to justify convicting the brother-in-law for insider trading? Or did the banker need to receive something tangible  say, a fancy new car or a duffel bag full of cash  in return?
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CFTC Swaps Report Update
CFTC
The CFTC Swaps Report provides a detailed weekly snapshot of the gross notional outstanding as of the penultimate Friday prior to the CFTC Swaps Report's Wednesday publication date, as well as a detailed weekly total of the transaction volume (on both a ticket volume and dollar volume basis) ending that same penultimate Friday, in two asset classes (interest rate swaps, credit default swaps).
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UBS is dismissed in U.S. silver lawsuit, other claims narrowed
Jonathan Stempel - Reuters
A U.S. judge has dismissed UBS Group AG (UBSG.S) as a defendant in a lawsuit accusing big banks of conspiring to fix silver prices and exploit price distortions at investors' expense. In a decision made public on Tuesday, U.S. District Judge Valerie Caproni in Manhattan also said investors may pursue some but not all antitrust and manipulation claims against Bank of Nova Scotia ("ScotiaBank") (BNS.TO) and HSBC Holdings Plc (HSBA.L).
jlne.ws/2dLECzb
CFTC Commissioner J. Christopher Giancarlo Releases Latest Podcast: 21st Century Markets Need 21st Century Regulation, October 5, 2016
Press Release
Today, Commissioner J. Christopher Giancarlo released a Podcast entitled "21st Century Markets Need 21st Century Regulation." The podcast released today follows the recent address the Commissioner gave to the American Enterprise Institute.
jlne.ws/2dLUx0b
ESMA PUBLISHES UPDATED AIFMD Q&A
ESMA
The European Securities and Markets Authority (ESMA) has published an updated questions and answers document on the application of the Alternative Investment Fund Managers Directive (AIFMD).
/goo.gl/PA3oJy
FINRA's Monthly Recap - September 2016
FINRA
Revisit the latest FINRA Notices, compliance resources, and news from September 2016.
/goo.gl/z1nBbX
Warning: System Maintenance
NFA
Due to system maintenance, the following systems will not be available on Saturday, October 8, 2016 between 7:00 a.m. and 5:00 p.m. CDT: Online Registration System, BASIC Data Entry, Security Futures Products Training, Online Payments, Online Arbitration Claims, Arbitrator Profile, Arbitrator Training, Employment Application and Profile System, and all Electronic Filings including EasyFile, Exemptions, Questionnaire, and Disclosure Documents. We apologize for any inconvenience.
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| Regions | | Stories of local interest from the Americas, EMEA and Asia-Pacific regions | Nobel laureate Stiglitz sees Italy, others leaving euro zone in coming years
Reuters
Nobel Prize-winning economist Joseph Stiglitz predicted in a interview out on Wednesday that Italy and other countries would leave the euro zone in coming years, and he blamed the euro and German austerity policies for Europe's economic problems.
jlne.ws/2dLW6v2
Investment banking: Asia beyond the headlines
Euromoney Magazine
September brought more evidence of the apparently shifting sands in Asia Pacific investment banking. First, news broke of plans at Goldman Sachs to cut up to 30% of its investment bankers in Asia - about 90 people. Then, a few days later, rumours spread of a dramatic expansion of investment banking capability at China Citic Bank in Hong Kong, in particular in M&A and equity capital markets.
jlne.ws/2dLE6Bc
China's Corn Reforms Harvest Headaches at Home and in U.S.; Push to overhaul bloated sector has left animal-feed imports from America more expensive
By LUCY CRAYMER - WSJ
China's effort to overhaul its bloated corn sector has sent local prices to their lowest levels in 10 yearsÂand left animal-feed imports from the U.S. more expensive for Chinese livestock farmers.
/goo.gl/rkYsRW
IPO Fest Puts Copenhagen in Big League as Offshore Cash Flows In
Christian Wienberg - Bloomberg
The man in charge of Nasdaq OMX in Copenhagen says the Danish capital is proving a surprising magnet for some of this year's biggest public listings.
/goo.gl/2pFR7A
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| Miscellaneous | | Stories that don't quite fit under the other sections | California Keeps On Farming, With or Without Water
By Justin Fox - Bloomberg
California agriculture, which had been plowing ahead in the face of a major drought, finally had an off year in 2015, according to data released recently by the U.S. Department of Agriculture. The state's farms brought in cash receipts of an estimated $47.1 billion (this will be revised in the months and years to come), down from a record $56.6 billion in 2014. Here's how that looks in historical context, with the numbers adjusted for inflation.
/goo.gl/m4SNAv
Looming megadroughts in western US would make current drought look minor; Warming temperatures and uncertain rainfall mean if more isn't done to slow climate change, droughts lasting 35 years could blight western states, study says
Oliver Milman - The Guardian
The harsh drought currently gripping California may appear trivial in the future as new research shows that the south-west US faces the looming threat of "megadroughts" that last for decades.
/goo.gl/Vcwa9q
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