| November 08, 2016 | "Irreverent, but never irrelevant" | | |  | John Lothian
Publisher
John Lothian News | |
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CME takes emergency action to prepare for Election Day volatility
Reuters
CME Group Inc took emergency action on Monday to allow bigger-than-normal price swings in its interest rate futures on Election Day on Tuesday, as the market operator warned that the U.S. presidential vote could increase volatility.
/goo.gl/TMBWu4
**** Make sure your seat belts are buckled and you have your Dramamine close for the motion sickness.
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Celebrities to join forces with the City to combat motor neurone disease
>From David Setters
The Broad Appeal are once again supporting their close friend David Setters for a quiz night as the next City Against MND event in London. Good Morning Britain presenter, Charlotte Hawkins, whose father sadly died of MND in 2015, has agreed to partner Chris as quiz masters at the event on 18 January 2017. So if you want to have a great night of fun testing your sporting and general knowledge, good food and even better company, then gather a team together and book a table. The event is being promoted by Contango Markets consultant and former Futures & Options World Managing Director, David Setters. Diagnosed with a slowly progressive version of the disease in 2012, Setters founded The City Against MND Network in 2015. "The Network aims to provide a focus for corporate, collaborative and individual giving from the City, its institutions and service companies," he explains. "I've already found several individuals working in financial services who have been in some way "touched" by the disease, whether through family, colleagues or friends."
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***** David Setters continues to show his leadership and courage.
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Another Last-Minute Regulation; The feds want to seize trade secrets without due process.
WSJ
Can a federal agency vote to eliminate due process for the people it regulates? The Commodity Futures Trading Commission (CFTC) is trying to do so with its 2-1 Friday vote that threatens liberty well beyond financial markets.
/goo.gl/KFk5km
***** The slippery slope of one regulator getting extrajudicial powers and other agencies, commissions and regulators pressing for it as well is a big issue here. There goes our system of checks and balances. With all due respect to the CFTC and their plans, we are a country of laws, and a core element is the design by our founders of checks and balances. Going outside the courts with special powers for the administrative branch undermines our rights and values.
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A trader's guide to watching the election, courtesy of Goldman Sachs
MarketWatch
Want to watch the election like a Vampire Squid? Goldman Sachs has produced a guide to watching the election. And while the conclusion from analyst Alec Phillips is pretty much consensus  a win for Hillary Clinton over Donald Trump, a slight Democratic majority in the Senate and the Republicans retaining control of the House  the hour-by-hour guide is very detailed and includes not just the time in which states close their polling, but what time races might be called.
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**** Here is an hour by hour guide from Bloomberg too.
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Wizards of Today's Markets: Jack Schwager, Part 1
Rick Lane - Trading Technologies
We recently ran our third "Wizards of Today's Markets" Q&A, rounding off our trio of Chicago trading legends with TransMarket Group's Ray Cahnman. To close out the series, we thought it would be fitting to talk with the originator of the "Market Wizards" moniker himself, Jack Schwager.
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***** The following series has been sponsored by Hogwarts, the School of Witchcraft and Wizardry. Do you think the CFTC will want to know their trading spells?
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Scott Feldman, ICAP Infinity - The Fintech Evolution
MarketsWikiEducation.com
"That ability to communicate well and play [the role of] Google Translate is a differentiating factor for someone in the fintech space. You've got to marry the technology with the finance, and a lot of times they don't speak the same language."
That ability to communicate is one of the soft skills that people hiring in the fintech space seek in candidates. But the industry looks for many more traits in prospective entrants because fintech is a developing corner of the market and, as such, there is no one template for a dream resume or candidate.
According to Scott Feldman, managing director with ICAP Infinity, while candidates can have a variety of traits that qualify them for a job, the business itself should always have three characteristics to help it succeed: being cheaper, better and faster. If you can improve the cost, improve the speed and/or improve the user experience, you will be successful at a given company or with a particular product.
A perfect example given by Feldman is the foreign exchange market. Improvement in all three of those categories turned FX into a $5.3 trillion daily market in 2015, compared with a $2 trillion market in notional daily value in 2004.
Watch the video »
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CBOE's Laura Zinanni Named Vice President, Office of the CEO
CBOE
The Chicago Board Options Exchange (CBOE) today announced it has promoted Laura Zinanni to the position of Vice President, Office of the CEO. In her new role, Zinanni will serve as a primary advisor to CEO Edward T. Tilly, providing advice and recommendations on complex issues as identified.
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***** And I thought a little bird was Tilly's primary advisor.
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Deutsche Börse Photography Foundation presents "C / O Talents - David Favrod, Verónica Losantos"
Deutsche Börse
The Deutsche Börse Photography Foundation is showing works by the two winners of the international talent competition "Talents" by C / O Berlin. The exhibition will be on display in the company headquarters of Deutsche Börse, The Cube, in Eschborn from 17 November 2016.
/goo.gl/N2TDbU
***** Take the time to see the exhibit when you visit The Cube.
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Monday's Top Three
It's election time and our readers love it. The top read piece was the Michael Lewis spoof piece in Bloomberg called Trump-Clinton Hack Reveals Wall Street's Secrets. Jim Kharouf's column about the importance of voting was a strong second - Time to Rise Up, Vote and Unite. Third went to those who are curious about just how much money donors are pouring into this mess of an election campaign with OpenSecrets' Top Individual Contributors: All Federal Contributions
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| Lead Stories | Election Marks Crossroads for SEC; Regulator is likely to get new leader, raising doubts about efforts to change financial reporting, other priorities
By TATYANA SHUMSKY - WSJ
The Securities and Exchange Commission is likely to get a new chairman no matter who wins Tuesday's presidential election, raising doubts about the agency's priorities.
/goo.gl/cYSVmC
SGX and the Baltic Exchange confirm completion of acquisition
SGX
Singapore Exchange Limited ("SGX") and The Baltic Exchange Limited ("Baltic Exchange") are pleased to announce that the acquisition of the Baltic Exchange by SGX has been completed today as planned, bringing together complementary strengths of Singapore and London, two of the world's most important maritime centres.
/goo.gl/sXFTrV
How Blockchain Will Change Your Life; The technology's potential goes way beyond finance.
By GINNI ROMETTY - WSJ
Until the mid-1990s, the internet was little more than an arcane set of technical standards used by academics. Few predicted the profound effect it would have on society. Today, blockchainÂthe technology behind the digital currency bitcoinÂmight seem like a trinket for computer geeks. But once widely adopted, it will transform the world.
/goo.gl/jzwjYQ
Wall Street Frets About Cybersecurity as U.S. Demands More Data
By ANDREW ACKERMAN - WSJ
In the wake of the financial crisis, federal regulators are demanding a vast trove of private data to help them better monitor markets. But in the age of routine, sophisticated hacks, many in the financial industry worry the government will be unable to keep that sensitive information secure.
/goo.gl/EcNTS2
Banking Technology Vendors Feel the Pinch
Telis Demos - WSJ
Bankers aren't the only ones feeling the pinch from cost-cutting at banks. Executives at DH Corp., Fiserv Inc., Fidelity National Information Services Inc. and others who sell technologies and services to banks have pointed to a drop in new spending by their clients as a factor in slower growth in key businesses.
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Europe to formalise new derivatives rules on Nov 21
by: Philip Stafford, Jim Brunsden - FT
Europe is set to formalise its delayed new rules clamping down on banks' ability to trade derivatives on November 21, pushing the introduction date date back a few weeks so it does not clash with investment banks' annual code freezes.
/goo.gl/fpzrl5
Cyber Risk And Geopolitical Threats Top List Of Financial Industry Concerns In New DTCC Survey
Press Release
Broad geopolitical risks, including the outcome of tomorrow's U.S. Presidential Election and Britain's exit from the EU ("Brexit"), were among top risks facing the global financial system, according to a new survey conducted and published today by The Depository Trust & Clearing Corporation (DTCC), the premier post-trade market infrastructure for the global financial services industry.
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In Battle of World's Biggest Oil Exchanges, One Gets Turbo Charge From Exports
Alex Longley - Bloomberg
Nymex WTI average daily volume growth more than double Brent; Exchange's prominence boosted by end of U.S. trade limits
In the battle for supremacy between the world's two largest oil exchanges, one of them is enjoying a turbo charge from the U.S. government.
/goo.gl/A0E9lz
European banks brace as they prepare to disclose US accounts; Experts say US profits of European banks are well below Wall Street rivals
by: Laura Noonan in London - FT
European banks' misadventures on Wall Street will come in for fresh scrutiny this week when they publish the first sets of quarterly accounts for what have often been troubled businesses.
/goo.gl/dkrpkI
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| Exchanges, OTC & Clearing | | Top news from exchanges, clearing, settlement and trade execution facilities | London Stock Exchange Welcomes World First Bond to Protect Forests and Deepen Carbon-Credit Markets
London Stock Exchange Group
London Stock Exchange today welcomes a first-of-its-kind bond, issued by the IFC - part of the World Bank Group - that gives investors the unique option of being repaid in either carbon credits or cash. Listed in London, the five year, 1.546 per cent coupon bond raised $152m from a wide range of international investors, to support private sector development and prevent deforestation in developing countries.
/goo.gl/h8tg4G
LCH clears over $1 trillion in inflation swaps notional
LCH
Over $1 trillion in inflation swaps since the service launched in April 2015; 43 members, 47 clients and 12 clearing brokers live and clearing GBP, EUR and USD inflation swaps; Significant uptick since introduction of bilateral margin rules, in some jurisdictions, on 1 September 2016; Record months in September and October with $170 billion in inflation swaps cleared in each month; a 500% increase compared to preceding 12 month average
/goo.gl/XStq8u
During His Participation In The World Federation Of Exchanges General Assembly, EGX Chairman Signs An MOU With BM&FBOVESPA
Mondovisione
EGX Chairman signed a memorandum of understanding with the Brazilian stock market "BM & FBOVESPA"; Omran launches an initiative for the WFE to adopt a Code of social responsibility and issue an annual report of sustainability; Omran discusses with Taiwan Stock Exchange the possibility of Dual Listing to attract new investments to the Egyptian market
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Bats Global Markets to Provide Bats One Quote, Trade Data to Morningstar
Agreement Builds upon Existing Relationship
BATS
Bats Global Markets (Bats), a leading global operator of exchanges and services for financial markets, and Morningstar, Inc., a leading provider of independent investment research, today announced an agreement under which Bats will provide the Bats One Summary market data feed to Morningstar.
/goo.gl/QqPWNw
New UBS equity index ETF on S & P 500 with currency hedging on Xetra started; ETF provides access to 500 leading US companies
Deutsche Boerse
Since Tuesday, a new equity index ETF has been traded on the S & P 500 index of UBS Global Asset Management via Xetra and Börse Frankfurt.
/goo.gl/mZaXdY
SGX reports market statistics for October 2016
SGX
Total Securities market turnover value was at S$19.6 billion, down 5% month-on-month and down 15% year-on-year, over 21 trading days. There were 21 trading days in September 2016 and 22 in October 2015.
Total Derivatives volume was 11.5 million, down 14% month-on-month and up 2% year-on-year.
/goo.gl/XZjXgR
Bats Global Markets says to provide bats one quote, trade data to Morningstar
Reuters
Bats Global Markets to provide bats one quote, trade data to Morningstar Source text for Eikon
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| Politics | | An overview of politics during an election year as it relates to the financial markets | What the Election Means for the Markets
Neil Irwin - NY Times
What will happen to financial markets after the election? More so than usual, we have a decent idea. That's because there has been a clear and identifiable swing in a variety of asset prices  especially the stock market and currencies  at inflection points in the presidential race. A stock market rally on Monday is the latest evidence. The 2 percent gain in the Standard & Poor's 500 as of about 2 p.m. appears to be linked to the announcement on Sunday by James Comey, the F.B.I. director, that an examination of newly discovered Hillary Clinton's emails revealed nothing warranting charges.
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Trump's Big-Money Cavalry Never Rode to His Rescue
Zachary Mider - Bloomberg
Trump's own donations fell short of $100 million he promised; Billionaire Adelson's spending was less than expected
On Monday, Donald Trump's campaign was asking fans to send $5 or $10 to buy pizza and snacks for election-day volunteers. He's ending his campaign against Hillary Clinton the way he began it: heavily outspent by his opponent.
/goo.gl/W5bJo6
Analysts seem to have resisted writing awful election notes
Alexandra Scaggs - Financial Times
Just how bad has this US election season been? Well, we're hard-pressed to find examples of tasteless Wall Street analyst headlines published about it. Seems like most gaffes are coming from the fintech industry these days. On the bank side, there have been cheesy notes, and some cringeworthy headlines, but for the most part, analysts have stayed between the lines. That's unusual! (Email us if we've missed something.)
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TV news prepares for a record-setting election night with Trump vs. Clinton
Stephen Battaglio - Chicago Tribune
If the wild, unpredictable 2016 presidential campaign is a reality show starring Donald Trump and Hillary Clinton, think of election night as the series finale. Based on the record-shattering ratings for the debates and all-time audience highs for the cable news networks during the past year, it's likely that Tuesday will be the most-watched night of election coverage ever.
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| Investing & Trading | | Today's top stories from fixed income, currencies and commodities (FICC) | Why the Math Behind Passive Investing May Be Wrong
Wesley Gray - WSJ
For many investors, the superiority of passive investing over active investing is axiomatic. And why not? Study after study has demonstrated that only a small portion of actively managed funds beat their benchmarks over long time frames. A recent Wall Street Street Journal article, "The Dying Business of Picking Stocks," noted that while 66% of mutual funds and ETFs are currently actively managed, this figure is down from 84% 10 years ago.
/goo.gl/NI10Wr
Why Consistency of Dividend Growth Matters
Kieran Kirwan - S&P Indexology
With anemic global economic growth, investors have become leery about U.S. companies' ability to grow earnings and increase dividends. Indeed, S&P 500 earnings declined for the fifth consecutive period in the second quarter of 2016 and even if the third quarter results are positive, the growth rate is likely to be very small. A potential consequence of this "earnings recession" is that future dividends could be at risk. Earnings are an essential driver of dividends, and ultimately returns, so there is good reason for concern.
/goo.gl/nnMd5o
Certain Volatility Funds Raising Election Risk for the Stock Market
Gunjan Banerji - WSJ
Investors on edge before the U.S. election have one more thing to worry about: Selling by certain funds and exchange-traded funds could aggravate volatility after voting day. As stock-market turbulence remained low for most of this year, so-called volatility-control funds added equities, according to Deutsche Bank. These funds, which represent about $200 billion, have a fixed allocation to bonds and adjust stocks bets in response to market swings, said Rocky Fishman, a New York-based equity derivatives strategist at Deutsche Bank.
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ETF product supply 'reaching saturation point' despite rapid growth in assets
Tom Eckett - InvestmentWeek
Despite the growing popularity of exchange-traded funds (ETFs), the supply of products to the market 'is reaching a saturation point' as launching new innovative offerings becomes increasingly difficult. According to the Global ETF Survey 2016, conducted by consultancy EY, 64% of ETF providers do not expect the success rate of new products to improve in the future (see chart, below).
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Oil investor impatience grows over global surplus
Amanda Cooper - Reuters
Oil investors are growing increasingly disgruntled with the pace at which supply and demand are rebalancing, cutting their bullish bets and pushing the benchmark price to its biggest discount relative to future prices in nine months. The premium of Brent crude futures for delivery in six months over those for prompt delivery, one measure of confidence in the market outlook, on Monday shot to its largest since February, the point at which OPEC first floated the idea of a possible deal on output to erode a two-year-old global surplus.
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Computer-Driven Hedge Funds Wrong-Footed on Bond Bets
Laurence Fletcher - WSJ
Computer-driven hedge funds' big bets on bonds are coming back to bite them. This $277 billion sector, which tries to profit from market trends and patterns, has been bulk buying government bonds in recent years, capitalizing on steady price rises. But they have been wrong-footed in recent weeks by a spike in U.S. and German government bond yields on worries about inflation and the limitations of central bank bond-buying programs.
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Re-slicing the global pie: FTSE GDP Weighted Index Series
Catherine Yoshimoto - FTSE Russell Blog
When you look at so many products that we buy and consume, is anyone shocked to see "Made in China" on the label? Probably not. It should come as no surprise then that China is now the world's largest economy. And yet the total capitalization of China's equity markets open to foreign investors lags far behind its global economic stature. In fact, there are many countries whose market capitalization does not reflect their relative share of the global economy. When a large discrepancy like this does exist, it can make sense to re-slice the global pie.
/goo.gl/X7AUHx
An Idea to Revolutionize Europe's Debt Could Be Coming of Age
Piotr Skolimowski - Bloomberg
What if it were possible to create a government bond for the euro area that was seen as a safe asset, without that meaning Germany has to stand behind the debts of others? Consider it done, almost. The European Safe Bond is, in theory, a parcel of euro-area government debt of different risk grades that would provide the 19-nation currency bloc with a single "safe asset" that's not linked to the fate of any individual member.
/goo.gl/VbqK73
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| Banks, Brokers & Managed Funds | | The latest from banks, brokers, hedge funds and managed futures | Banks gird for Brexit-style tumult following U.S. election
Olivia Oran - Reuters
U.S. banks, including Morgan Stanley (MS.N), JPMorgan Chase & Co (JPM.N) and Goldman Sachs Group Inc (GS.N), are bracing for potential tumult on financial markets in the wake of Tuesday's U.S. election. Bank preparations ahead of the U.S. election reflect their experience following Britain's shock vote to leave the European Union in June, when the S&P 500 fell 3.6 percent the day after the poll
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SEC Investigating Banks Over Possible Mishandling of ADRs; Agency sent subpoenas to BNY Mellon, Citigroup, Deutsche Bank and J.P. Morgan Chase, sources say
By JEAN EAGLESHAM - WSJ
The U.S. Securities and Exchange Commission is looking into whether big banks have been mishandling securities in the arcane but sizable market for American depositary receipts, according to people close to the investigation.
/goo.gl/GVjdQX
HSBC investors fear timetable to find new bosses is slipping
Sinead Cruise and Simon Jessop - Reuters
Some major shareholders in HSBC (HSBA.L) want the bank to give greater reassurance on succession-planning for its chairman and chief executive, concerned that a timetable for replacing veterans Douglas Flint and Stuart Gulliver may be slipping.
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Europe banking: The 20-year trade with zero return
Euromoney Magazine
European banks stocks have been on a tear since their summer lows, with the Stoxx Europe 600 banks index rising by 30% from the bottom of 117 in early July, up to 153 at the end of October. And while investors could be forgiven for being underwhelmed by this - given that the index is still down 17% year-to-date - some market participants are daring to hope that the worst may be over for European banks.
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RBS sets aside £400m to compensate small businesses; Fund dismissed as 'wholly inadequate' by former customers of bank's restructuring arm
by: Martin Arnold, Banking Editor - FT
Royal Bank of Scotland is putting aside almost £400m to compensate some of the small business owners that allegedly suffered at the hands of its controversial restructuring unit in the aftermath of the financial crisis.
/goo.gl/bztuCV
TRADING UP: JPMorgan Shuffles Equities Staff; KeyBanc Hires ABS Team
John D'Antona - MarketsMedia
JPMorgan announced a slew of staff changes within its equities team. After hiring Mark Leung and Jason Sippel as global co-heads of equities in September, the two dispatched a memo announcing multiple moves within the equities group.
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Crédit Agricole quarterly net profits boosted by bond trading; French bank plans to pay an all-cash dividend of 60 cents per share for 2016
by: Michael Stothard in Paris - FT
Shares in Crédit Agricole jumped on Tuesday after the French bank said that a rebound in bond trading had helped net profits to double in the third quarter from the same period last year.
/goo.gl/7k3IWX
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| Fintech | | A roundup of today's market tech news and a look at tomorrow's disruptors | Steve Ballmer's Plan to Make America Great Involves Excel Spreadsheets; The ex-Microsoft CEO is working on a project that aims to make government data more accessible.
Dina Bass - Bloomberg
Steve Ballmer is pretty bummed out about the election. A self-proclaimed "numbers guy," Ballmer said the truth is getting lost in the political rhetoric, and he wants to arm citizens with data to defend against lies by the campaigns. "Nobody seems to care about the facts," he said.
/goo.gl/1BcbeH
Why Susquehanna feels more like a tech company
eFinancialCareers
Guy, a network architect in the technology team at Susquehanna International Group (SIG), actually enjoys his commute to work. "I drive over the Sydney Harbour Bridge every morning - that certainly beats taking a crowded train to work in the cold in London," says Guy, who joined the quantitative trading firm earlier this year. But it's not only his stunning daily journey and "amazing new lifestyle" in Sydney that appeal to the Englishman - he's finding the company culture at Susquehanna to be refreshingly technology focused.
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FinTech firms team up to bring AI to global bond markets; BondIT to integrate Chinese market data from Wind Info to build on existing fixed income tool.
By Hayley McDowell - The Trade
BondIT has teamed up with financial data and research provider for Chinese markets, Wind Info, to enhance its existing machine learning tool.
/goo.gl/uhVFgm
After cyber attacks, Internet of Things wrestles with making smart devices safer
By Jeremy Wagstaff and J.R. Wu - Reuters
Recent cyber attacks harnessing everyday devices such as cameras, video recorders, printers, routers and speakers are a wake-up call to the hidden dangers of the Internet of Things.
/goo.gl/t8KGz5
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| Regulation & Enforcement | | For more regulatory, visit MarketsReformWiki, our website focused on current market reform efforts. | SEC Investigating Banks Over Possible Mishandling of ADRs
Jean Eaglesham - WSJ
The U.S. Securities and Exchange Commission is looking into whether big banks have been mishandling securities in the arcane but sizable market for American depositary receipts, according to people close to the investigation.
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German banking association calls for extension to Basel IV timetable
Reuters
The German banking association (BdB) on Monday called for an extension to the timetable to decide on new international banking regulation. The Basel Committee of bank supervisors from nearly 30 countries intends to deliver the new Basel IV rules by the end of this year.
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Exclusive: U.S. states join Dow-DuPont merger probe - sources
Diane Bartz - Reuters
U.S. state attorneys general have joined a federal antitrust probe of the planned merger between DuPont (DD.N) and Dow Chemical Co (DOW.N), according to three people familiar with the matter, heightening risks to a deal that could help reshape the global farm industry.
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SEC to hold Fintech Forum on Nov. 14
SEC
The SEC is scheduled to host a forum to discuss innovation in the financial services industry Nov. 14, 2016, at SEC headquarters in Washington, D.C.
/goo.gl/dPiQOT
Sebi's investment advisory guidelines face resistance
Business Standard News
United Forum, a forum of national and regional associations of distributors and independent financial advisors (IFAs), has opposed several of the proposed amendments to the Sebi (Investment Advisors) Regulations, 2013.
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Steven Majoor Speaks at European Commission's Hearing on Review of EU Macro-Prudential Framework
ESMA
RISK ANALYSIS & ECONOMICS - MARKETS INFRASTRUCTURE INVESTORS
Steven Maijoor, Chair, today spoke at the European Commission's Public Hearing on the Review of the EU Macro-prudential framework.
/goo.gl/7L3S9S
ASIC welcomes 'client money' reforms
ASIC
ASIC today welcomed the Government's decision to proceed with 'client money' reforms in respect of retail OTC derivatives. 'The reforms to the client money regime will strengthen protection of client money that is provided by retail derivative clients. By improving protection for retail client money, the reforms will help to increase investor confidence in the Australian financial system,' said ASIC Commissioner Cathie Armour.
/goo.gl/UJECEi
Complaints about listed companies jump in Hong Kong; Regulator says it is hearing about 'inexplicably high' valuations
by: Don Weinland and Jennifer Hughes in Hong Kong - FT
Complaints to the Hong Kong securities regulator about "problematic" public companies have risen sharply in a sign of the pressure it is coming under to crack down on questionable practices, the head of the watchdog has admitted.
/goo.gl/r4ecD7
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| Regions | | Stories of local interest from the Americas, EMEA and Asia-Pacific regions | China's securitisation market blossoms; Diverse range of assets from home mortgages to dance ticket sales packaged for sale
by: Gabriel Wildau in Shanghai - FT
An ancient Chinese poem, famously quoted by Mao Zedong, calls for diversity: "Let 100 flowers bloom; let 100 schools of thought contend."
/goo.gl/Wr4VS7
SBI-FTSE to create bond index for India
Anup Roy - Business Standard News
In a significant development for the Indian bond market, State Bank of India (SBI) and FTSE Russell, the arm of the London Stock Exchange, will jointly develop a bond index for global investors to benchmark Indian bond market against that of its competitors.
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Falling China forex reserves follow weaker currency
Roger Blitz - Financial Times
China's foreign exchange reserves dropped more sharply than expected in October, falling to their lowest level in more than five years, according to data released by the country's central bank.
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A Toxic Mix of Banks and Politics; Italy's referendum threatens the latest emergency recapitalization of Banca Monte dei Paschi di Siena
By JAMES MACKINTOSH - WSJ
Politics and banks are a toxic mix, as the U.S. election has made plain. Banks will find out if the same is true in Italy early next month when the country's referendum on constitutional changesÂbeing treated by many as a vote on the popularity of Prime Minister Matteo RenziÂthreatens the latest emergency recapitalization of Banca Monte dei Paschi di Siena SpA, the world's oldest bank.
/goo.gl/FCDcCp
Stars of 'The Big Short' bet on Japan's BIMBOS trade; It's a stock market strategy designed to benefit as Japanese corporates buy publicly-listed subsidiaries
by: Leo Lewis - FT
By agreement of all but a few diehards, the once fabulous investment-by-acronym party is over. A window or two has been broken, the carpet definitely needs replacing and BRICs, CIVETs and MINT are stumbling into the night through the neighbour's hedge.
/goo.gl/j14mYx
Rand Takes Over Mantle of World's Most Political Currency
Xola Potelwa - Bloomberg
Volatility exceeds Mexican peso's as America goes to polls; Uncertain political outlook makes currency a tough trade
Move over Mexico. With the U.S. election campaign over, South Africa's rand has replaced the peso as the currency poised for the biggest politically driven price swings.
/goo.gl/sGmnic
Saving China's stock market
Yi Huang, Jianjun Miao, Pengfei Wang - VOX
The Chinese Shanghai Stock Exchange Composite Index dropped by a third in mid-2015, wiping out billions in share value. One of the responses of the Chinese government was to directly participate in the stock market. This column assesses the costs and benefits of this intervention, finding that the resulting gains amounted to about 5% of Chinese GDP. The value was created not just from increased equity and investor confidence, but also from increased liquidity and reduced probability of default for listed firms.
/goo.gl/VT1qHv
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| Miscellaneous | | Stories that don't quite fit under the other sections | First came Grexit. Then Came Brexit. Now Prepare Yourself for Italex.
Ben Eisen - WSJ
Traders and investors love to shorten things, especially the names of faraway risks that are sure to be talked about over and over again. First, there was Grexit, the term given to the possibility of Greece leaving the European Union. Then there was Brexit, for the British vote to leave the bloc. One enterprising strategist even came up with Chexit to describe China's currency decoupling from the U.S. dollar.
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