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Exchange Invest is a free daily email/web newsletter
about the core events pertaining to investment
in financial markets infrastructure such as:

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JUNE 12 2017

Good Morning and welcome to Exchange Invest Issue 1013 which corresponds to the year AD in which China surpassed Europe (capital Kaifeng, becoming the largest city in the world, overtaking Cordoba in Andalusia) while the Vikings conquered England…the barbarian raiders overrunning the country and forcing Aethelred the Unready to flee to Normandy. Plus ca change some might say.

Prosperity UK Video

Prosperity UK Panel – Brexit, Euro Clearing & Financial Market Structure: panel ably chaired by Barney Reynolds headlining parish luminaries Jeff Sprecher and Michael Spencer, with one Patrick L Young lurking in the background – perhaps the ‘hot button’ parish topic in derivatives of the moment…

In Today’s Exchange Invest

Finally Vikram Limaye is approved as NSE CEO while standing down from his cricketing commitments. Xavier discusses Euro clearing fiasco as he bats on for a longer innings. For now ICE global cotton contracts retires hurt to the pavilion while I bowl a few pithy googlies.

And there’s more, happy scrolling:

In BigWorld

Plaudits to Paris where Emmanuel Macron has been buoyed despite a low turnout as it looks like his party’s overall majority will be achieved in Parliament. Once the run offs are complete, the tough task of turning a fluid new movement into achieving the reform France desperately needs, will begin.

Over in the UK, chaos reigns as Mrs May looks even less competent than Friday morning after some fabulously tone deaf moments and pure slapstick incompetence over the weekend. That said, for those dreamers believing Brext is a goner, bear in mind MPs elected on pro-Brexit manifestos represent 580+ of the 650 UK MPs. Meanwhile the Labour (pro Marxist) shadow Finance Minister made it clear yesterday on TV his party believes in leaving the single market… Mrs May faces her backbench MPs tonight in what is likely to be, at best, a frosty meeting.

Public Markets

LSE Boss: It Wasn’t Brexit That Killed DB1 Dream
Telegraph.co.uk

PLY: Not clear what he definitively thinks did kill the Merger of Equal Desperation:

“While three months have passed since that moment, Rolet is evidently still frustrated by the deal’s collapse and the reasons behind it – he insists the partnership didn’t crumble because of “Brexit, competition or business rationale” but doesn’t really pinpoint who or what is to blame. He repeats that it is far better to try and fail than not to try at all.”

The XavRol narrative that he is staying for the long term continues. That said this is a classic Sunday newspaper fawn so whatever he says was met with unquestioning fascination on the part of the interviewer. You can almost read the pupil dilation between the lines. Nonetheless, Xav makes some pithy and pertinent remarks defending his turf in the euro clearing shenanigans:

““It’s going to be complete chaos. This has not been properly thought through,” he says, angry that there has been so little time to respond to the consultation. “To give the market a month for a consultation, it’s never happened in the history of the EU. You want a policy proposal in a month? Frankly that is not how good policy is made. Consider the systemic issues linked to a botched or hurried migration. This is extraordinarily complex.”

The most attractive alternative to London in his mind is not somewhere in Europe but New York, he adds, before batting off any signs of concern for his business.”

Brexit Threat To London’s Euro Clearing House : Brussels Poised To Seize £747Bn A Day Business
This is Money

PLY: The EU’s jumbo threat to European financial stability.

Cinnober Implements A Stock Split
Cinnober

PLY: Three for One.

London Stock Exchange Group Plc Transaction In Own Shares
MondoVisione

Private Markets

Despite Hopes, ‘Flash Boys’ Heroes Are Far From Reshaping Us Stock Market
Wall Street Journal (subscription)

PLY: Strikes me there is a difference between “hopes” and “projections.” A miracle projection came upon many parishioners who read “Flash Boys” and dreamt of their ideal marketplace (albeit not that it was purely homogeneous between the supporters’ visions either). Thus far in, IEX is making steady progress. “Rome wasn’t burnt in a day” and the process of reshaping an exchange landscape will take a long time with IEX playing their role in creating a better market structure… Albeit the US remains hidebound by the idiocy of Reg NMS et al which demonstrates the crass ineptitude of those regulators who were arrogant enough to believe that their hubris could outsmart a generation (even a decade) of human ingenuity.

Should UK Bend IPO Rules For Saudi Aramco?
Sky News

PLY: Nope. This listing brings a whole series of potentially toxic issues to the heart of the chalice.

Sebi Approves Vikram Limaye’s Appointment As MD & CEO of NSE
Economic Times

PLY: More in “Career Paths” below. Meanwhile NSE will at least breath a sigh of relief that their chosen CEO candidate has passed (belated) regulatory muster.

NSE Crisis: Will Sebi Initiate A Deeper Probe Into Alleged Unfair Trade Practices?
Firstpost

“NSE may need to restate its financials because the co-location server facility stream accounted for nearly 35-40 percent of NSE’s core revenues.”

PLY: NSE goes #Coyote on the ‘uglyometer.’ First time the “C-word” has been deployed here relating to NSE. How ironic! That most glacial of organisations, NSE, the pure execution hybrid of Indian economic prowess, laid so low as to be viewed as subject to “Crisis!” Clearly an IPO even by December may look optimistic. If newly confirmed by Sebi CEO Vikram Limaye thought delivering trust in cricket was a challenge, he now has a remarkable task ahead of him.

Why NYSE Is Implementing A ‘Speed Bump’ & How It Could Help
Forbes

PLY: The ultimate speed bump here is the Forbes website not being visible on all browsers…

Tel Aviv Bourse To Remove Hurdles For New Members
Reuters

PLY: “New” CEO Ittai Ben-Zeev working to shake up the TASE.

Real Cos & Entrepreneurs Left Now, Tourists Have Gone Back: Dev Khare, Lightspeed India
DealStreetAsia

PLY: Interview with Dev Khare of Lightspeed India, who notes 4 key areas of interest, one of which is parish pertinent:

“The fourth is financial tech, particularly lending, which has been very active in 2016. Then there is B2B marketplaces, where we have a very successful company India Energy Exchange in our portfolio and last year, we invested in another B2B marketplace Udaan.”

Debate On New Stock Exchange In Nepal
New Business Age

CDSL May Set IPO Price Band At Rs 145-149
Economic Times

Irish Stock Exchange Top-Placed Irish SME Workplace In EU Awards
Beat 102-103

CEO Of Ghana SE Urges President To Form SEC Board
Ghana Business News

Special Section: FTI, NSEL, India at the Crossroads

Ajay Tyagi, And The Job Of A Sebi Overhaul
Livemint

PLY: Article covers all angles of the challenges facing Ajay Tyagi as Sebi Chairman…but is included in this section as I am quoted discussing just why NSEL needs to be cleared up once and for all.

A Result Of Meticulous Research
The Statesman

He has been likened to the mythical Abhimanyu of the Mahabharata, who was trapped in a sinister plot by the Kauravas, and like John Galt, the protagonist of Ayn Rand’s Atlas Shrugged.

PLY: Review of the book “The Target” all about Jignesh Shah, his rise and fall.

Technology

Nasdaq Backs France’s Stratumn’s $6.25M Investment In Blockchain & Data Security Space
Forbes

PLY: Another investment for the NASDAQ ventures arm. Apologies if the Forbes site does not load on your browser, this has been the case for some weeks now, alas.

Ipreo And Hamilton Lane Announce The Formation Of Private Market Connect
PR Newswire UK (press release)

PLY: Somewhere within this appallingly structured, opaque press release, there may lurk the kernel of something interesting…

Products

30th Anniversary of Equity Futures Market
JPX

PLY: Congratulations to JPX on this milestone.

ICE Delists World Cotton Futures Contracts
Times of India
World Cotton Futures Die A Quiet Death
Financial Times

PLY: A real shame, the ICE team worked hard to innovate but in the end the complexities of a single global benchmark was too much to add volume, with the US contracts remaining the overwhelming (if unsatisfactory) benchmark. A lesson perhaps in the overarching single holy grail approach to product development (India please take note) but will regional contracts now be the angle? Clearly there is a huge opportunity here and ICE are to be applauded for their innovation in an era when exchanges are less willing (often for understandable budgetary scale reasons) to produce new contracts. The opportunity for new markets is greater than ever…but often at a quantum below where the behemoths can sensibly, directly invest.

Sebi Board To Consider Cutting IPO Listing Time To 4 Days
Livemint

PLY: Sebi is moving forward which is great news. The difficulty is trying to convert an inert, if not downright reactionary, entity into something which progressively helps markets as opposed to merely meddling…

Sebi Body Wants Review Of Position Limits For Commodity Futures
Economic Times

PLY: QV above.

NCDEX Launches Futures In Degummed Soy Oil
Business Standard

Iran Mercantile Exchange Moves to Break Auto Pricing Monopoly
Financial Tribune

PLY: Fascinating…

Career Paths

Vikram Limaye To Head NSE , Will Leave COA Role On July 14
The Hindu

PLY: Finally, a decision! Sebi Kremlinologists will note a correlation with the Ravi Narain departure last week while it is clear Sebi disliked the idea of Limaye also having a key role in the cricketing world – which may be an issue of regulatory oversight or just plain jealousy on the part of a forbidding bureaucrat within cricket crazy India.

Trump To Nominate Ex-NYSE Euronext VP Dawn Deberry Stump To CFTC
Reuters

PLY: Good luck to Dawn Deberry Stump. It strikes me La Stump’s nearly 4 year tenure as FIA SVP and Head of Government Affairs is rather more pertinent than her period as one of the legions in the DVD army of old.*

*Newcomers to the parish gazette may be shocked to know that once upon a time NYSE was perceived as a shambles and Euronext a train wreck of internal bickering…in this enlightened “ICE age” I appreciate this ‘ancient history’ is hard to believe.

Fox News Favorite Announces Future Run For US Senate
BizPac Review

PLY: Apparently Eric Bolling is a leading financial TV anchor (does anybody watch this stuff any more?). The former commodities trader on the New York Mercantile Exchange was “discovered” on the trading room floor, which led to a career on CNBC and then FOX. Good luck to him in politics…

Cliff Moyce Interview
NASDAQ

PLY: Good to see LIFFE stalwart Cliff interviewed about DataArt and more…

Long Island Hires & Promotions: Autism Communities
Newsday

PLY: I appreciate that Gary Katz may not welcome attention on his activities ex-exchanges, as he is a private man. However as a great parishioner, doubtless he will add considerable value the Deer Park based Long Island Autism Communities Inc. and while the former ISE CEO may be, in his trademark understated fashion, hiding his light under a bushel, I am sure all parishioners wish him well in helping with the complexities of autism.

Crowdfunding

There Are Now 29 FINRA Regulation Reg CF Crowdfunding Portals
Crowdfund Insider

Crowdfunding Is In Trouble — & The Game Industry Can Save It
VentureBeat

Crowdfunding isn’t fatigued — it’s growing up.

Multi-Lingual Crowdfunding Sites Can Attract Global Audience
London Business School

Online crowdfunding platforms in Europe will struggle to attract investors from around the globe unless they use more than one language on their site…

Peer-To-Peer Comes Of Age As Alternative Asset Class For Investors
Financial Times

PLY: Brussels Bugle, often critical of P2P comes out as a supporter.

Other Stories

I think that’s quite enough for today…
Have a great Monday…look at it this way: whatever happens you have a sporting chance your day will be better than Theresa May’s!

Thanks for reading Exchange Invest!

Patrick

Patrick L Young
Executive Director DV Advisors

April 2018
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