| August 24, 2023 | "Irreverent, but never irrelevant" | | | | John Lothian
Publisher
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Hits & Takes
John Lothian & JLN Staff
The SEC was busy yesterday with several press releases and numerous statements from the commissioners. Among the press releases were "SEC Enhances the Regulation of Private Fund Advisers" and "SEC Adopts Amendments to Exemption From National Securities Association Membership."
The statements from the commissioners included:
- Statement on Private Fund Advisers - Chair Gary Gensler
- Statement Regarding Private Fund Advisers Rulemaking - Commissioner Caroline A. Crenshaw
- Statement on Private Fund Advisers; Documentation of Registered Investment Adviser Compliance Reviews - Commissioner Mark T. Uyeda
- Empowering and Protecting Private Fund Investors - Commissioner Jaime Lizarraga
- Statement Regarding Exemption from National Securities Association Membership - Chair Gary Gensler
- Statement on the Adoption of Amendments to Rule 15b9-1 m - Commissioner Hester M. Peirce
- Statement Regarding Exemption from National Securities Association Membership - Commissioner Caroline A. Crenshaw
- Improved Oversight of Off-Exchange Trading - Commissioner Jaime Lizarraga
- Statement on Final Rule Regarding Exemption for Certain Exchange Members - Commissioner Mark T. Uyeda
The Managed Funds Association also put out a statement, "MFA Statement on SEC's Adoption of Final Private Fund Adviser Rule."
Cboe's CEO Ed Tilly was on Bloomberg Markets: The Close yesterday talking about a surge in VIX options trading and new products.
According to a story in Futurism, "Elon Musk Associates Say His Strange Behavior May Be Related to Ketamine Habit." This could explain a lot of the erratic behavior. It must be incredibly difficult to run all those companies he has and to be that rich and that isolated.
According to various reports, including one from CoinDesk, Sam Bankman-Fried plans to blame his lawyers for bad advice for his mistakes running FTX.
Speaking of FTX's current lawyers, they are burning through $1.5 million in legal costs every day, CoinDesk reports.
Just in case you were wondering, former Chicago Bulls great Michael Jordan is the richest basketball player ever, with a fortune of $3.5 billion, Bloomberg reports.
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
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New data from the World Federation of Exchanges (WFE) found that geo-political and economic tensions have hampered expectations of a quicker economic recovery. Bank failures in Europe and in the United States, as well as persistent inflation, which has forced central banks to tighten monetary policies, contributed to the uncertainty. Download the WFE's H1 2023 Market Highlights report here. ~SAED
Our most read stories yesterday on JLN Options were:
- Wall Street blamed zero-day option traders for a sudden stock-market selloff. But a BofA team says they got it wrong.
- Nvidia stock options traders are bracing for larger move than usual after earnings
- Worried About Inflation Or Where The Market Is Headed? Warren Buffett Thinks This Asset Class Is The Answer ~JB
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HOU is the Domestic Crude Oil Benchmark on the Move
JohnLothianNews.com
Jeff Barbuto is trying to build a new benchmark in U.S. domestic crude oil at Intercontinental Exchange, where he has worked for 21 years running oil and is now the head of global oil markets. The benchmark is HOU, the Midland WTI contract for the Gulf Coast first started five years ago with the help of Magellan Midstream Partners.
Listen to the podcast »
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Bank of America Disputes Goldman Logic on Zero-Day Option Threat to Stocks; Booming investing tool spurs fresh handwringing on Wall Street; Latest debate centers around last week's flurry in put trading
Lu Wang - Bloomberg
The heated debate on the threat posed by the boom in stock derivatives that expire within 24 hours is pitting two of Wall Street's biggest banks against each other. After Goldman Sachs Group Inc. blamed the rise of zero-day options for the late-afternoon S&P 500 selloff seen on Aug. 15, Bank of America Corp. dubs the logic "largely misguided." At the center of the disagreement: The precise role played by put derivatives that protect against equity losses with a strike price at 4,440, a level close to where the market was trading at that time.
/jlne.ws/3QT7WEm
****** If investors want to sell, they will find a way. They always have. This blame the derivative baloney is old, stale and misguided.~JJL
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Leaked Zoom all-hands: CEO says employees must return to offices because they can't be as innovative or get to know each other on Zoom
Ashley Stewart - Business Insider
Zoom CEO Eric Yuan told employees this month that the company was making the surprising decision to send some workers back to the office regularly because its flagship remote-work product didn't allow employees to build as much trust or be as innovative as in the office, according to a leaked meeting recording viewed by Insider. Zoom, one of the main enablers and beneficiaries of remote work, told employees living within 50 miles of a Zoom office that they must work there at least two days a week. The top reason for the mandate, Yuan said at the August 3 meeting, is that it's difficult for employees to get to know each other and build trust remotely.
/jlne.ws/3OURjpo
****** In related news, gun companies say don't use guns as you can shoot yourself in the foot.~JJL
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American workers are demanding almost $80,000 a year to take a new job
Jeff Cox - CNBC
The amount of money most workers want now to accept a job reached a record high this year, a sign that inflation is alive and well at least in the labor market. According to the latest New York Federal Reserve employment survey released Monday, the average "reservation wage," or the minimum acceptable salary offer to switch jobs, rose to $78,645 during the second quarter of 2023. That's an increase of about 8% from just a year ago and is the highest level ever in a data series that goes back to the beginning of 2014.
/jlne.ws/45I3cWa
****** Wage inflation is the next shoe to drop.~JJL
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Cargill boss calls for ship owners to invest in wind power; US agricultural trader and freight operator is testing vessel fitted with 37.5 metre-high sails
Oliver Telling - Financial Times
Cargill's head of ocean transport has called on the shipping industry to give wind power a chance in its efforts to decarbonise, as one of the world's largest marine freight operators prepares to test the use of sails on a midsized vessel.
/jlne.ws/3E7TaSH
***** As George Amberson said, the only honorable thing to be in life is a yachtsman.~JJL
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Cboe CEO Says Firm Can Go After Deals in Open Jurisdictions
Katherine Doherty - Bloomberg
Exchange operator Cboe Global Markets Inc. can do future acquisitions and expand its global presence due to its "flexible balance sheet," according to Chief Executive Officer Edward Tilly. "There is nothing we have to do. We like to be in jurisdictions that are open to competition, and we like to be there in scale," Tilly said in an interview with Bloomberg Television Wednesday. "That's really where our acquisitions have been in the past."
/jlne.ws/3P9qZcf
****** I need to have some "Tilly Shark" t-shirts made up. The man is now a shark.~JJL
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Wednesday's Top Three
Our top story Wednesday was The Wall Street Journal's This $599 Putting Green Improved My Golf Game. It Might Work For You. It's definitely still summer. Second was Bloomberg's A Bitcoin ETF Debuts, But Traders Aren't Biting. Third was Insider's Sam Bankman-Fried does not have access to Adderall in custody and subsists on a diet of peanut butter sandwiches and water, his attorney alleges.
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| Lead Stories | Goldman, JPMorgan, Morgan Stanley, UBS Settle Stock-Lending Suit
Chris Dolmetsch and Bob Van Voris - Bloomberg
Goldman Sachs Group Inc., Morgan Stanley, JPMorgan Chase & Co. and UBS AG agreed to pay nearly $500 million to settle an antitrust class action by US pension funds over the banks' control of the market for stock loans used for hedging and short selling.
/jlne.ws/47HPjcp
Pension funds shake off crypto worries with backing for broker Hidden Road; Retirement plans try to juice their returns but observers see risks if hedge fund borrowers suffer losses
Nikou Asgari - Financial Times
Traditional investors such as pension funds are providing the financing to a broker that is helping hedge funds take bigger bets on volatile cryptocurrency assets. Retirement plans including that of US defence contractor Lockheed Martin are among the backers of crypto prime broker Hidden Road, according to people with knowledge of the matter, providing the financing that in traditional markets typically comes from banks.
/jlne.ws/44q4G6m
Majority of prop trading firms obliged to join FINRA under expanded SEC rule; Potentially dozens of broker-dealers are set to be affected by the ruling; market opinion divided on decision.
Claudia Preece - The Trade
The Securities and Exchange Commission (SEC) has moved to expand the remit of national securities associations such as the Financial Industry Regulatory Authority (FINRA). to cover previously exempt proprietary trading firms. The move to increase the number of broker dealer firms registering with FINRA comes as the commission aims to promote fair, orderly, and more efficient markets. The decision is set to contribute to greater transparency and strengthened oversight in the treasury markets due in large part to the fact that FINRA requires members report post-trade activity in these markets.
/jlne.ws/3spwTNs
Are hedge fund pioneers facing the end of a golden era? The multi-manager model has generated years of exceptional returns, even after fees. But rising interest rates and an expensive battle for talent are taking their toll
Harriet Agnew and Ortenca Aliaj - Financial Times
As an undergraduate at Harvard University, Ken Griffin had a satellite dish installed on the roof of his dorm room so he could trade convertible bonds, laying the foundations for the launch of his Citadel hedge fund in 1990.
/jlne.ws/45kpP37
Another Metals Trader Says It Has Been Hit by a Nickel Fraud; US trader Kataman says it found containers full of steel waste; Kataman details alleged fraud in lawsuits in London, Singapore
Archie Hunter, Alfred Cang, and Jonathan Browning - Bloomberg
Another trading house has been stung after buying a cargo supposedly containing nickel that turned out to be full of near-worthless rubble. The latest example, detailed in lawsuits in London and Singapore, is separate from the $600 million alleged fraud against Trafigura Group that shocked the trading industry earlier this year, but it involves several of the same companies.
/jlne.ws/45mq1PE
SEC Crackdown Spurs Bitstamp to Stop US Crypto Staking Service; Bitstamp will discontinue staking services from Sept. 25; SEC crypto clampdown views staking as unregistered security
Olga Kharif - Bloomberg
Bitstamp, one of the oldest digital-asset exchanges, will discontinue staking services in the US amid a crackdown on the product by the Securities and Exchange Commission. The decision was made in the light of "current regulatory dynamics" in the US, Bistamp's national Chief Executive Officer Bobby Zagotta said in a statement. The move takes effect on Sept. 25, he added.
/jlne.ws/3KUaDSj
SEC Pushes for More Visibility Into High-Speed Traders' Treasury-Bond Moves
Alexander Osipovich - The Wall Street Journal
The Securities and Exchange Commission will force more high-frequency traders to report data on their Treasury bond trades, part of the agency's ongoing effort to step up regulation of electronic traders in the U.S. government debt market. In a 3-2 vote on Wednesday, the SEC's commissioners tightened a decades-old exemption that some trading firms have used to avoid becoming members of the Financial Industry Regulatory Authority, as many broker-dealers are required to do.
/jlne.ws/3P9tUBL
WhatsApp messages between traders lands bank with £5.4m fine; Ofgem says rules to ensure energy market transparency were broken by the bank's failure to police rules banning communications via WhatsApp.
James Sillars - SkyNews
A major US bank has been fined £5.4m by the UK's energy regulator for failures to record and retain communications between traders. Ofgem said that the penalty imposed on Morgan Stanley & Co International plc (MSIP) was the first of its kind and related to discussions over WhatsApp between January 2018 and March 2020.
/jlne.ws/3qK0TTP
'Golden Age' for Investing Is Over, Evercore's Ralph Schlosstein Says; The period has passed as rates stay higher for longer, he says; Ahead, the way to make money is equities; he also likes cash
Isabelle Lee - Bloomberg
The aggressive monetary tightening launched by the Federal Reserve last year has brought an end to a "Golden age of investing' that will force Wall Street traders to rethink how they allocate their portfolios, says Ralph Schlosstein, chairman emeritus at Evercore ISI.
/jlne.ws/45BPc0R
Tornado Cash Founders Storm, Semenov Charged by US in Money Laundering Scheme; One man arrested in Washington state, another is a fugitive; Founders helped North Korea launder money, US prosecutors say
Bob Van Voris and Allyson Versprille - Bloomberg
Two founders of Tornado Cash, a cryptocurrency mixing service that has been under scrutiny by various US agencies for more than a year, were charged with helping launder more than $1 billion for clients that included a North Korean cybercrime organization. Roman Storm and Roman Semenov were charged with conspiring to launder money, violate US sanctions and operate an unlicensed money-transmitting business. Tornado Cash claimed to provide untraceable and anonymous financial transactions using a cryptocurrency.
/jlne.ws/3KVnO5z
Geo-political and economic tensions have hampered expectations of a quicker economic recovery, WFE data shows quicker economic recovery
World Federation of Exchanges
New data published by the World Federation of Exchanges (WFE), the global industry group for exchanges and central clearing counterparties, shows that the various geo-political and economic tensions markets experienced during the first half of 2023 have hampered expectations of a quicker economic recovery.
/jlne.ws/44mVeRd
Libor Zombies Pit Hedge Funds Against Banks in High-Stakes Feud; Traders buy old, cheap bank debt with no easy shift from rate; Strategy is to reject transition efforts, push for repayment
Tasos Vossos and William Shaw - Bloomberg
One of the most lucrative, and contentious, trades of 2023 has emerged in an obscure corner of financial markets, minting overnight profits for the hedge fund crowd of as much as 35%.
/jlne.ws/3slJpgZ
The Brics don't stack up as a committee to run the world; Even the rival long-established G7 rich countries have often struggled for consensus
Alan Beattie - Financial Times
For evidence that Brics summits are adopting the routine features of the global governance circuit, observe the familiar jostling during this week's meeting in South Africa to manufacture an announcement and maintain the impression of forward momentum.
/jlne.ws/3qSiqcm
Brics leaders invite 6 nations including Saudi Arabia to join bloc; Cyril Ramaphosa says countries will be admitted next year in 'first phase of expansion process'
Joseph Cotterill - Financial Times
The five Brics nations have invited Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates to join their emerging market group, South African president Cyril Ramaphosa said on Thursday. The countries will join the Brics bloc made up of Brazil, Russia, India, China and South Africa at the start of next year as the "first phase of the expansion process" for the forum, Ramaphosa said at the end of the summit of Brics leaders in Johannesburg.
/jlne.ws/47FbK29
BRICS bank can help African countries tackle urgent challenges
Reuters
The New Development Bank created by BRICS countries in 2015 can help finance African countries' projects to tackle their most urgent challenges, the bank's president Dilma Rousseff said on Thursday. The BRICS countries are "good partners" for Africa, former Brazilian President Rousseff said in a speech in Johannesburg, adding the bank would finance physical and digital infrastructure projects in Africa as well as educational ones.
/jlne.ws/3sus3hQ
What to Know About Key Nations Seeking to Join BRICS; Saudi Arabia, Argentina, Indonesia and Egypt are among the potential candidates to expand the five-nation bloc, many of them seeking stronger ties with non-Western powers. Iran is also interested.
Vivian Yee, Natalie Alcoba, Farnaz Fassihi and Sui-Lee Wee - The New York Times
Dozens of countries have expressed interest in joining BRICS, a group encompassing Brazil, Russia, India, China and South Africa that views itself as a counterweight to the West and which is meeting this week in Johannesburg.
/jlne.ws/44rOAt0
Who Has the Weakest Banks - the US or China? The two governments are both addicted to debt. Lenders are just collateral damage.
Shuli Ren - Bloomberg
Wherever you look, banks seem to be paying the price for their governments' past policy errors. Lenders in the world's two largest economies are in a horse race to see which one spirals to the bottom first.
/jlne.ws/3KTupNS
Apollo Sued Over $570 Million Payout Tied to Leon Black Departure
Jef Feeley - Bloomberg
Apollo Global Management was sued by an investor seeking information about $570 million in payments the private equity firm made to founders Leon Black, Josh Harris and Marc Rowan after Black's ouster over his ties to sex offender Jeffrey Epstein.
/jlne.ws/3E6Qjtc
Hedge Funds, PE Firms Hit With New SEC Fee Disclosure Rules
Lydia Beyoud and Dawn Lim - Bloomberg
Hedge funds and private equity firms will have to disclose more about their fees and face new restrictions from the US Securities and Exchange Commission on giving investors special treatment.
/jlne.ws/3siMgam
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| Ukraine Invasion | | News about the invasion of Ukraine by Russia and its military, economic, political and humanitarian impact | Wagner acolytes mourn Yevgeny Prigozhin as Kremlin stays silent; Investigators launch criminal investigation into crash of private jet allegedly carrying militia group's founder
Polina Ivanova in Berlin and Henry Foy in Brussels - Financial Times
Wagner fighters made a makeshift memorial for their founder Yevgeny Prigozhin in St Petersburg on Thursday as the Kremlin maintained its silence on the warlord's apparent demise in a plane crash. Supporters of Prigozhin, who is listed among the passengers of a private jet that crashed north-west of Moscow on Wednesday, killing all aboard, mourned the warlord's loss and accused "traitors" of assassinating him in retribution for a mutiny he led in late June.
/jlne.ws/3qP6dVR
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| Exchanges, OTC & Clearing | | Top news from exchanges, clearing, settlement and trade execution facilities | Deutsche Borse, SimCorp acquisition receives final approval from regulators; Deutsche Börse agreed to acquire SimCorp in an all-cash public takeover for $4.3 billion earlier this year.
Claudia Preece - The Trade
Deutsche Borse has confirmed it has received final regulatory approval from for its $4.3 billion acquisition of SimCorp. The offer period for the acquisition expires on 19 September, with the transaction expected to be completed by 29 September at the latest. Deutsche Börse entered into a binding agreement to acquire SimCorp in an all-cash public takeover back in April. At the time the acquisition was expected to complete in Q3 2023.
/jlne.ws/44pkNkS
IOSCO, CPMI report examines central counterparty risks; Policymakers seek to ensure CCP readiness to handle loss events
James Langton - Investment Executive
In the wake of the global financial crisis, policymakers pushed for greater use of central counterparties (CCPs) in the global derivatives markets. Now, they're calling on CCPs to ensure that they have adequate resources to deal with risks such as investment losses and cyberattacks. In a joint report, the International Organization of Securities Commissions (IOSCO) and the Bank for International Settlements' Committee on Payments and Market Infrastructures (CPMI) stressed the need for CCPs to ensure they can handle losses triggered by events other than trading-firm defaults.
/jlne.ws/47Oqvzt
HKEX expected to cover damages in LME nickel lawsuits; Legal costs cannot be passed to members as non-default losses under the LME's rule book, lawyers say
Luke Clancy and Samuel Wilkes - Risk.net
Clearing members of the London Metal Exchange are not expected to foot the bill for any damage awards or lawsuit settlements over the cancellation last year of nickel trades worth billions of dollars, according to multiple sources familiar with the exchange's rule book.
/jlne.ws/47NlOWy
Deutsche Boerse Receives Final Regulatory Approval for Public Takeover of SimCorp
Deutsche Boerse
As announced by Deutsche Boerse AG after receiving feedback from the European Commission on August 23, 2023, it has received the final regulatory approval for the public takeover of the Danish SimCorp A/S.
/jlne.ws/3PaIE3q
EEX Press Release - EEX to provide registry and auctioning services for biogas certificates in France (Please see French version below)
European Energy Exchange
The European Energy Exchange(EEX) has been appointed by the French Ministry of Energy Transition to develop and operate registry and auctioning services for biogas Guarantees of Origin (GOs), as well as registry services for biogas production certificates. In coordination with the Ministry, EEX will launch the biogas GO registry on 1 October 2023, taking over from the French gas distributor GrDF, the current operator of the scheme. First auctions for biogas GOs are expected to be held at the beginning of 2024.
/jlne.ws/45o2Hkm
Correction To 2023 Full-Year Results Presentation Slides
ASX
ASX advises that an error appeared on page 47 of the 2023 Full-Year Results Presentation Slides released to the market on 17 August 2023. The error relates to two of the line items demonstrating the changes to the ASX Group own cash reserves and short-term investments for FY23.
/jlne.ws/46R1Cme
Toronto Stock Exchange, TSX Venture Exchange, TSX Alpha Exchange and Montreal Exchange Closed for Labour Day
TMX
Toronto Stock Exchange, TSX Venture Exchange, TSX Alpha Exchange and Montreal Exchange will be closed on Monday, September 4, 2023 for the Labour Day holiday.
/jlne.ws/47EL0Pf
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| Fintech | | A roundup of today's market tech news and a look at tomorrow's disruptors | Adyen, Block, PayPal Learn the Dangers of Fintech Hype
Lionel Laurent - Bloomberg
Being a middle man in the world of digital payments is "a good business to be in," wrote a pair of former SWIFT executives in their 2021 book The Pay Off. Processors shuffle money from A to B on behalf of merchants, take 1%-3% off the top, and keep whatever's left after banks and card issuers get their cut. "Sometimes the best ideas really are the simplest," they concluded.
/jlne.ws/45mz2rU
This Unstoppable Fintech Keeps Crushing Analyst Estimates
Eric Volkman - The Motley Fool
Following the lead of Warren Buffett's Berkshire Hathaway, investors have been diving into this company. Investors love companies that consistently beat earnings estimates. One that has now done so in three of the past four reported quarters is the rapidly up-and-coming Brazilian fintech Nu Holdings. Here's a look at how rapidly the company has been growing, and why it's been topping expectations so routinely of late.
/jlne.ws/3OKsKLH
Citi Makes Strategic Investment in Rextie, Peru's Leading Fintech for FX Services
Press Release
Citi, a global leader in foreign exchange (FX) markets, has made a strategic investment in Rextie, Peru's leading fintech for FX services. The investment makes Rextie Latin America's first FX fintech to receive an investment from one of the largest banks in the world. Citi's cutting-edge FX technology will also be integrated into Rextie's currency exchange services.
/jlne.ws/3qSnKMS
Fintech Tycoon Emerges as Mystery Backer Behind Kazakh Bank Deal
Nariman Gizitdinov - Bloomberg
A billionaire co-owner of Kazakh fintech giant Kaspi.kz JSC provided the financial backing that helped resolve the biggest asset dispute since Nursultan Nazarbayev resigned as president in 2019, according to people familiar with the matter. Kazakh authorities asked Kaspi's chairman, Vyacheslav Kim, to extend the previously undisclosed funding that allowed for a change in ownership at First Heartland Jusan Bank, the people said, speaking on condition of anonymity to discuss private details.
/jlne.ws/3YVaPqb
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| Cybersecurity | | Top stories for cybersecurity | Strengthening Cybersecurity In Finance: A Look At EU DORA Regulations
Perry Menezes - Forbes
In November 2022, the European Union published the Digital Operational Resilience Act (DORA). The intent of this act is to add information and communications technology (ICT) requirements to the previously adopted operational resilience regulation for financial services providers in EU member states. Financial services organizations operating in the EU-and organizations providing services to EU financial service firms-are expected to comply with DORA requirements before January 17, 2025.
/jlne.ws/3KTGGlw
House bill would require federal contractors to adopt cyber vulnerability disclosure policy
Justin Doubleday - Federal News Network
Vulnerability disclosure policies have proliferated throughout federal agencies in recent years, and if a new House bill ends up becoming law, federal contractors would have to adopt policies for accepting vulnerability information from security researchers as well. Rep. Nancy Mace (R-S.C.) today announced the Federal Cybersecurity Vulnerability Reduction Act of 2023. Mace is chairwoman of the House Oversight and Accountability Committee's cybersecurity, information technology and government innovation subcommittee.
/jlne.ws/44qJ4qF
NIST Releases Cybersecurity Framework 2.0 Draft
InComplianceMag
The National Institute of Standards and Technology (NIST) has recently published for public comment the first draft of its Cybersecurity Framework 2.0 (CSF 2.0). First published in 2014, the NIST Cybersecurity Framework is a voluntary framework that includes standards, guidelines, and best practices to help organizations more effectively manage cybersecurity risks. The Framework also fosters increased communications between both internal and external stakeholders about risk and cybersecurity issues.
/jlne.ws/45o70fw
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| Cryptocurrencies | | Top stories for cryptocurrencies | Worldcoin's Eyeball-Scanning Crypto Dream Is Under Threat
Hannah Miller - Bloomberg
It's been an eventful month for Worldcoin since minting its crypto token. The project, co-founded by OpenAI Inc.'s Sam Altman, quickly learned that if you try to scan the eyeballs of every person on earth in exchange for crypto, regulators might have some questions.
/jlne.ws/3qPclgP
UK's Travel Rule Troubles Showcase Global Challenge for Crypto; U.K. crypto firms have just days to comply with new anti-money laundering requirements - but they are seeking more guidance given patchy implementation of the controversial FATF rule between jurisdictions.
Camomile Shumba, Jack Schickler - CoinDesk
U.K. crypto firms have just days to implement the "travel rule" designed to curb money laundering - but patchy implementation of the rule globally is not making it easier for service providers to comply, CoinDesk has been told by industry experts.
/jlne.ws/3QSZrJs
FTX Seeks to Appoint Novogratz's Galaxy to Manage Giant Crypto Hoard; Administrators aim to maximize the value of the FTX estate; Spat over assets had erupted between FTX and some creditors
Sunil Jagtiani - Bloomberg
The administrators of FTX are seeking to appoint the asset management arm of billionaire Michael Novogratz's Galaxy Digital Holdings Ltd. to help oversee the bankrupt exchange's giant pile of digital tokens.
/jlne.ws/3OGIwXS
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| Politics | | An overview of politics as it relates to the financial markets | The west is suffering from a crisis of courage; Trump's refusal to turn up to the Republican debate is one more sign that this virtue is no longer held to be important
Jemima Kelly - Financial Times
The first Republican primary debate, held in Milwaukee on Wednesday, was an unusual one: it featured no one who currently stands a chance of being the party's candidate in next year's presidential elections. The only man who does, Donald Trump, decided it wasn't worth the hassle. "I am leading the runner up, whoever that may now be, by more than 50 Points," the four-times indicted former president wrote on his social media platform, Truth Social, on Friday. "People know my Record, one of the BEST EVER, so why would I Debate?"
/jlne.ws/3YQdcKI
Washington drafts proposal for Venezuela's oil sanction easing
Marianna Parraga, Vivian Sequera and Timothy Gardner - Reuters
U.S. officials are drafting a proposal that would ease sanctions on Venezuela's oil sector, allowing more companies and countries to import its crude oil, if the South American nation moves toward a free and fair presidential election, according to five people with knowledge of the plans.
/jlne.ws/3KPPMzB
NRA-Style Politics Transformed Canada's Gun Culture - and Shootings Rose 869%; A third of guns used in Canadian crimes and then traced by authorities were legally imported from the US. That's three times the global average.
Natalie Obiko Pearson, David Kocieniewski and Eric Fan - Bloomberg
Some 300 miles north of Canada's border with Montana, the prairies end, the roads narrow and the rural towns give way to the vast, unbroken forests of northern Saskatchewan, where on clear nights the aurora borealis dance above pristine lakes. This is the home of Canada's highest rate of gun crimes.
/jlne.ws/44myssS
Putin to BRICS: Russia is 'reliable partner' for Africa on food, fuel supplies
Reuters
Russian President Vladimir Putin told the BRICS summit in South Africa on Thursday that Moscow intends to deepen ties with African countries, and that it would remain a reliable partner for food and fuel supplies. In a video link address, Putin said Russia was interested in developing "multi-faceted ties" with Africa, which has been roiled by fuel and food price rises resulting from the conflict in Ukraine.
/jlne.ws/3qSjuNo
Zimbabwe election marred by delays and vote-rigging accusations; Some voters in southern African nation still to cast ballots more than 24 hours after poll began
Joseph Cotterill and Kudzanai Musengi - Financial Times
The closely watched general election taking place in Zimbabwe has been marred by long delays, accusations of vote-rigging and the arrest of local polling observers, threatening another contested election outcome for the southern African nation. Some voters were still waiting to cast ballots on Thursday, more than 24 hours after the election started. The government of President Emmerson Mnangagwa, who is seeking a new five-year term, was forced to extend voting times by decree at dozens of wards including in the capital Harare as his ruling Zanu-PF faced vote-rigging claims.
/jlne.ws/44mXYht
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| Regulation & Enforcement | | Stories about regulation and the law. | Tornado Cash Founders Charged with Money Laundering and Sanctions Violations; Roman Storm and Roman Semenov Charged with Operating the Tornado Cash Service, Laundering More Than $1 Billion in Criminal Proceeds
U.S. Department of Justice
A Russian national and a Washington man were charged today with conspiracy to commit money laundering, conspiracy to commit sanctions violations, and conspiracy to operate an unlicensed money transmitting business.
/jlne.ws/44oajCh
New Securities Commission Malaysia Board Members Appointed
Mondovisione
The Securities Commission Malaysia (SC) today announced the appointments of Dato' Mohammad Faiz Azmi and Dato' Alizatul Khair Osman Khairuddin as Board Members for a two-year term, effective 15 August 2023.
/jlne.ws/3KUJ6zY
BaFin - Shares In Swiss Investment Solution: Grounds To Suspect Shares Being Offered To The Public Without The Required Prospectus
Mondovisione
BaFin has sufficient grounds to suspect that Swiss Investment Solution is offering its shares to the public in Germany without the required prospectus. The company has not published a prospectus for this product. As a rule, securities may be offered to the public in Germany only if a prospectus has been published. This prospectus must be approved by BaFin prior to publication. Offering securities to the public without an approved prospectus constitutes a violation of the prospectus requirement under Article 3(1) of the EU Prospectus Regulation - unless an exemption applies.
/jlne.ws/3qIXrJa
BaFin Investigates Baring Private Equity London
Mondovisione
The Financial Supervisory Authority (BaFin) warns consumers about the company Baring Private Equity London. The company has been contacting customers of Interactiv Global Brokers on an unsolicited basis and offering to buy off shares in Ecological Technologies Ltd. that these customers had bought in the past through Interactiv Global Brokers as broker.
/jlne.ws/3E7PEaG
Over 3,100 Charged With Pandemic Relief Fraud, Justice Dept. Says; The department outlined several cases, including one in which the defendants were accused of using fraudulently obtained funds to solicit a murder.
Madeleine Ngo - The New York Times
For more than two years, Leon Haynes, a New Jersey tax preparer, told some of his clients that the federal government was giving out "free money" in the form of pandemic relief to people who owned businesses. According to federal prosecutors, Mr. Haynes filed more than 1,000 false tax forms, fraudulently claiming more than $124 million in Covid-19 employment tax credits for businesses that he and others owned.
/jlne.ws/3OMxTmw
CFTC Charges Texas Man and His Company with Fraud and Misappropriation
CFTC
The Commodity Futures Trading Commission today filed a civil enforcement action in the U.S. District Court for the Northern District of Texas against Walter Dunning Larrick, III, a former resident of Corpus Christi, Texas, and Cambridge Financial Advisors, LLC, a Texas limited liability company owned and controlled by Larrick. The complaint alleges Larrick and Cambridge fraudulently induced at least 70 people to invest over $3.6 million in a purported commodity pool and then misappropriated most of the pool funds.
/jlne.ws/3KRCWAE
SEC Adopts Amendments to Exemption From National Securities Association Membership
Amendments will enhance FINRA oversight of firms that trade securities proprietarily across markets
SEC
The Securities and Exchange Commission today adopted rule amendments that narrow the exemption from Section 15(b)(8) of the Securities Exchange Act of 1934, which requires any broker or dealer registered with the Commission to become a member of a national securities association unless the broker or dealer effects transactions in securities solely on an exchange of which it is a member. The Financial Industry Regulatory Authority Inc. (FINRA) currently is the only registered national securities association.
/jlne.ws/44mzeGi
SEC Charges Former Attorney at U.S.-Based Global Law Firm with Insider Trading; Visiting attorney at the Washington, D.C. office of law firm used access to confidential client info to make illegal profits
SEC
The Securities and Exchange Commission today announced insider trading charges against Romero Cabral da Costa Neto for trading based on material, nonpublic information concerning a client of the global law firm where he worked as a visiting attorney from Brazil.
/jlne.ws/3YP5GzZ
SEC Reopens Comment Period for Enhanced Safeguarding Rule for Registered Investment Advisers Proposal
SEC
The Securities and Exchange Commission today reopened the comment period on its proposed rule that would redesignate and amend the current custody rule under the Investment Advisers Act of 1940 to enhance protections of customer assets managed by registered investment advisers, which was proposed by the Commission on February 15, 2023. The initial comment period ended on May 8, 2023.
/jlne.ws/3EaWTii
SEC Enhances the Regulation of Private Fund Advisers
SEC
The Securities and Exchange Commission today adopted new rules and rule amendments to enhance the regulation of private fund advisers and update the existing compliance rule that applies to all investment advisers. The new rules and amendments are designed to protect private fund investors by increasing transparency, competition, and efficiency in the private funds market.
/jlne.ws/3EbfHhy
SEC Charges Former New Jersey Corrections Officer with Crypto Fraud Scheme Targeting Law Enforcement Personnel
John DeSalvo also charged with fraud in separate investment scheme
SEC
The Securities and Exchange Commission today charged former New Jersey State Correctional Police Officer John A. DeSalvo with fraudulently raising funds through the unregistered offering of the Blazar Token, a crypto asset security he created but that collapsed in May 2022. The SEC also charged DeSalvo with misappropriating investor funds, much of which he sent to his personal crypto asset wallets and used to pay for a bathroom renovation.
/jlne.ws/47O6sl0
SEC Charges Former New Jersey Corrections Officer with Crypto Fraud Scheme Targeting Law Enforcement Personnel
SEC
The Securities and Exchange Commission today charged former New Jersey State Correctional Police Officer John A. DeSalvo with fraudulently raising funds through the unregistered offering of the Blazar Token, a crypto asset security he created but that collapsed in May 2022. The SEC also charged DeSalvo with misappropriating investor funds, much of which he sent to his personal crypto asset wallets and used to pay for a bathroom renovation.
/jlne.ws/3QVDutd
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| Investing & Trading | | Today's top stories from equities, indices and FICC (fixed income, currencies and commodities) | 'Inflation tapeworm' makes companies more susceptible to shocks; The risks of a corporate mis-step are rising and the potential impact is deepening
Anne Richards - Financial Times
"Inflation acts as a gigantic corporate tapeworm," Warren Buffett wrote in 1982 when US consumer prices rose just over 6 per cent over the year. "That tapeworm pre-emptively consumes its requisite daily diet of investment dollars regardless of the health of the host organism."
/jlne.ws/3qI53eQ
Nvidia's AI boom exceeds Wall Street's lofty expectations; Revenue more than doubles amid soaring demand for chips needed to train latest artificial intelligence models
Richard Waters - Financial Times
Nvidia's revenue more than doubled in the latest quarter on soaring demand for the chips needed to train the latest artificial intelligence models, outstripping even the heightened estimates that had spread on Wall Street in recent days.
/jlne.ws/3srSV2g
Nvidia's AI Surge Is Just Getting Started; Blowout results and forecast show demand isn't short-lived, but high prices will spur competition
Dan Gallagher - Bloomberg
Much of the world might think Nvidia's NVDA 3.17%increase; green up pointing triangle artificial-intelligence boom is a new thing. It has actually been a very long time in coming and will likely last a while too. Nvidia has been at the AI game for more than a decade now. The company began touting its Cuda programming language used by AI developers to investors as early as 2006, according to transcripts compiled by S&P Global Market Intelligence. That technology formed the foundation of a business to sell the graphics processors once used mainly in videogames to data center operators seeking more-advanced computing capabilities. Nvidia's data center business crossed the $1 billion mark in annual revenue five years ago and recently surpassed the size of its videogaming business.
/jlne.ws/3E9CY3f
US Venture Capital Funding Value Nosedives More Than Half YoY During January-July 2023, Finds GlobalData
Mondovisione
Venture capital (VC) funding activity in the US witnessed a considerable year-on-year (YoY) decline during January-July 2023. A total of 4,617 VC funding deals were announced in the US during the period, which was a decline of 37.4% over 7,379 VC deals announced during the same period in 2022, finds GlobalData, a leading data and analytics company.
/jlne.ws/44vNtZC
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| Environmental, Social and Corporate Governance | | Stories about environmental, social and governance investing | EU's new Green Deal chief to reach out to industry and voters; Maros Sefcovic has promised 'intensive' talks amid a growing backlash against bloc's climate agenda
Alice Hancock and Andy Bounds - Financial Times
The EU's new Green Deal chief has promised "intensive" talks with industry and voters about the bloc's measures to fight climate change, amid concerns raised by environmental groups that Brussels could further water down legislation. Maros Sefcovic on Wednesday sought to strike a balance between the European Commission's ambitious climate goals and what he described as helping the continent's industry "maintain their traditionally very strong position in the global economy".
/jlne.ws/47MUPe0
Investors Call on G20 to End Unsustainable Agri Subsidies
Vibeka Mair - ESGInvestor
A US$7.3 trillion coalition convened by investor network FAIRR has called on G20 finance ministers to align agricultural support with climate and nature goals by 2030. Supported by 32 investors, including Legal & General Investment Management and BNP Paribas, the investor statement calls for the repurposing of agricultural subsidies to align with government, multilateral, and private sector commitments to transition to net zero and protect and restore nature by 2050. Subsidies and other incentives make up around 15% of total agricultural production value globally, and can incentivise the over-production and over-consumption of greenhouse gas-intensive agricultural products.
/jlne.ws/45HAcOA
Pension Funds, BlackRock to Finance Battery Storage Expansion
Aaran Fronda - ESGInvestor
In a move aimed at bolstering sustainable energy infrastructure, three Canadian pension funds have joined forces with global asset manager BlackRock to invest US$1.2 billion in Swedish battery manufacturer Northvolt. The Investment Management Corp. of Ontario (IMCO), the Canada Pension Plan Investment Board, and the Ontario Municipal Employees Retirement System have partnered with BlackRock to enhance a convertible debt programme that was initiated by Northvolt last year, according to a recent report. With this latest infusion of capital, the programme's total size has expanded to US$2.3 billion,
/jlne.ws/47M0noX
Bank Boardrooms Need More Experts on Nature-Related Risks; Less than a third of CDP's survey respondents focus on forests and water concerns as much as climate change. Some are now waking up to how nature impacts their profit.
Nathaniel Bullard - Bloomberg
Most financial firms are failing to see how the natural world impacts their business, but they're about to wise up - quickly. That's one conclusion you could make from the latest financial disclosure report from CDP. For years the non-profit has collected data on how banks, insurers, asset managers and asset owners approach the measurement of risks from climate change. Last year it asked companies to do the same for nature-related problems from commodity-driven deforestation to water insecurity.
/jlne.ws/3KVwxVk
'I Don't Want to Go Home.' Europe's Housing Is Not Heat-Ready; Millions of people on the world's fastest-warming continent live in houses and apartments ill-equipped for rising temperatures.
Olivia Rudgard - Bloomberg
Emily Wilkie's introduction to motherhood has been monopolized by heat. A 34-year-old charity director, Wilkie lives in London with her husband and their four-month-old son Dylan. Their apartment's large windows make for an airy space that appealed to Wilkie's husband when he bought the place, but they also let in constant sunlight. Once the temperature outside cracks 27C (80F), the flat stays at least three degrees warmer. In summer months, the family dog wears a cooling vest. Dylan, Wilkie says, is "constantly sweaty." "It just makes him so miserable," she says. "You have all this guilt about being a bad mum. It is really stressful."
/jlne.ws/3YPfjhV
Indonesia Aims to Finalize $20B Climate Plan by COP28
Faris Mokhtar - Bloomberg
/jlne.ws/3qIVuMS
EU Anti-Climate Lobbying Stalling Africa's Transition
Emmy Hawker - ESGInvestor
/jlne.ws/3YPpsLv
Equinor opens world's largest floating wind farm in Norway
Nora Buli - Reuters
/jlne.ws/3KQuUbm
Canada steps up pace of oil production growth, seen rising 8% in two years
Nia Williams - Reuters
/jlne.ws/3PbcqoL
More than a decade after nuclear meltdown, Fukushima water release begins
Reuters
/jlne.ws/3P8WN0L
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| Banks, Brokers & Managed Funds | | The latest from banks, brokers, hedge funds and managed futures | FTSE UK Index Series - Indicative Quarterly Review Changes September 2023
FTSE Russell
FTSE Russell, the global index provider, advises of the following indicative changes to the FTSE 100 and 250, based on data as at Friday 18th August 2023.
/jlne.ws/3OLmaVb
Inside Fidelity International's fund to invest in biodiversity; The head of Fidelity International's portfolio of climate and biodiversity funds, Velislava Dimitrova, addresses the rise of nature-related investments.
Grant Harrison - GreenBiz
Investors know carbon pretty well: how to measure it, assess its impacts and incorporate it into investment-decision making. Of late, institutional investors have signaled they want to play their part in addressing what scientists are calling the sixth - and first human-caused - mass extinction. Investment funds built to consider the risks and value creation opportunities posed by nature and biodiversity loss have started launching, and disclosure frameworks including the Taskforce on Nature-related Financial Disclosures (TNFD) should allow investors to better understand, allocate and engage on material nature-related issues. Examples include investing in circular water solutions, alternative proteins to prevent land-use conversion or sustainable fish feed.
/jlne.ws/45ZWH1p
'Thematic Fatigue' Hobbles Once-Hot Slice of ETFs With Outflows; People got burned by themes, like with ARKK, says Psarofagis; Clean energy, fintech-centered ETFs among those with outflows
Vildana Hajric - Bloomberg
A once-hot sliver of the exchange-traded funds universe focused on thematic investing is having another difficult year.
Investors have yanked roughly $2.6 billion from these types of ETFs so far in 2023, putting them on pace for their worst year of outflows in data going back to 2001, according to Bloomberg Intelligence. If the trend holds it will be the second consecutive year of cash leaving thematic funds, the first such losing streak of the last two decades.
/jlne.ws/45JrX4f
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| Work & Management | | Stories impacting work and more about management ideas, practices and trends. | In Reversal Because of A.I., Office Jobs Are Now More at Risk; Technology disruption typically affected blue-collar occupations. Now white-collar workers may feel the brunt of changes.
Claire Cain Miller and Courtney Cox - The New York Times
The American workers who have had their careers upended by automation in recent decades have largely been less educated, especially men working in manufacturing.
/jlne.ws/44oHUvG
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| Wellness Exchange | | An Exchange of Health and Wellness Information | More People Call in Sick on August 24 Than Any Other Day; The second 'sickest' day of the year falls after Super Bowl Sunday in February.
Mia Gindis - Bloomberg
Perhaps it's the inexplicable craving for a day off ahead of the big Labor Day holiday. Perhaps it really is a stomach bug, or that more recent fiend - the coronavirus. And of course, it might just be the blues at the end of summer.
/jlne.ws/3KUYrk2
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| Regions | | Stories of local interest from the Americas, EMEA and Asia-Pacific regions | Rare Japan Bond Fund Plan Shows Once-Dead Market Coming to Life; Asset manager plans new fund launches for retail investors; Investor interest in JGBs is growing after BOJ policy tweak
Takashi Nakamichi and Nao Sano - Bloomberg
SBI Global Asset Management Co. plans to target retail investors with two new mutual funds for Japanese government bonds, a rare launch that shows activity revving up as the central bank loosens its grip on yield control.
/jlne.ws/3OPUTRh
Lira Rallies as Turkey Raises Rates to Near Two-Decade High; The central bank raised rates above survey expectations New MPC members were appointed last month in latest revamp
Beril Akman - Bloomberg
Turkey's central bank raised interest rates far more than expected, in the first sign that a new lineup of monetary officials favors more aggressive moves to curb inflation running near 50%. The lira surged. The Monetary Policy Committee, under Governor Hafize Gaye Erkan, raised the rate to 25% from 17.5% and far above survey expectations. Most economists polled by Bloomberg predicted a hike to 20%.
/jlne.ws/3OM6P6F
Israel will expand gas exports to Egypt, says energy ministry
Reuters
Israel on Wednesday said it will boost natural gas production from its offshore Tamar field and increase exports to Egypt, which is contending with rising demand and falling output. Exports to Egypt will be increased by an additional 38.7 billion cubic meters (bcm) of natural gas over 11 years, the ministry said, and production from Tamar will grow by 60%, or 6 bcm annually, from 2026.
/jlne.ws/45xSulc
EU to open third round of joint gas buying in September
Reuters
The European Union will open its third round of joint gas buying next month, as the bloc moves to secure supplies in preparation for another winter with scarce Russian gas. The EU started collectively buying gas this year, as part of its response to Russia slashing gas deliveries in 2022 following its invasion of Ukraine.
/jlne.ws/45kcEzf
Nigerian Central Bank Threatens Forex Dealers as Naira Wobbles; Regulator imposes trade penalties on banks, exchange bureau; Nigeria struggling to stabilize forex since June devaluation
Emele Onu - Bloomberg
Nigeria's central bank has stepped up its scrutiny of lenders and foreign-exchange bureaus, marking the latest effort to ease a dollar shortage that has sapped the naira.
/jlne.ws/3ORlY6Z
Argentina's economic activity down 4.4% in June as agriculture plunges
Reuters
/jlne.ws/3YNEHoo
Trudeau's Oil Pipeline at Risk of More Delays With Route Change; Trans Mountain cost has exceeded C$30 billion amid setbacks; Expansion promises to triple capacity of pipeline to Pacific
Robert Tuttle - Bloomberg
/jlne.ws/45BjGiM
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| Miscellaneous | | Stories that don't quite fit under the other sections | I want my salt back; I'm under attack on two fronts: there's no salt in my food - and no salt shakers to correct it with
Tim Hayward - Financial Times
It all started a couple of months ago, on a Sunday morning. I'd nipped into one of my cafes for a quiet bacon and egg roll. A harmless indulgence that I justify easily as "quality control" and entirely unrelated to greed or hangover. The grill cook passed over my usual - a fluffy white roll and four spectacularly crisp rashers lined up just so, topped with a fried egg, winking at me with its cyclopean yellow eye. I took it to a table where we could be alone.At first bite, I spotted that something was amiss and called the cook over. "This is going to sound daft, but can we put some salt on this bacon?" It turned out that the cook, too, had been sprinkling extra salt on her own bacon roll. "I don't know what's going on," she said, "but it tastes better that way, doesn't it?"
/jlne.ws/3sksCuB
The clear and present danger of the transactional gift; The ability of some wealthy US families to gain privileged access to elite universities is one example of our deeply tangled thinking about 'gifts'
Gillian Tett - Financial Times
At a smart New York lunch the other day, the conversation turned to the emotive subject of elite university admissions. "What type of gift do you need to give to guarantee a mediocre kid an Ivy League place these days?" asked one participant, only half in jest.
/jlne.ws/3QXK3vz
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