JUNE 8 2017

Good Morning and welcome to issue 1011 of Exchange Invest – an issue which corresponds to the year when the Chinese Guangyun rime dictionary was compiled under Emperor Zhenzong of Song. Use that factoid across the water cooler at your peril…

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 – this remains clearly the ‘hot button’ parish topic of the moment…

In Today’s Exchange Invest

Charles Li on Bond Connect. Euro Clearing being moved forcibly – bad idea according to everybody apart, surprisingly from those who might receive a gift horse from the EuroGods… MIFID II definitely still on schedule – so expect chaos and regression come January in the EU as the shambles of micromanagement unfolds.

Pakistan Stock Exchange IPO under way, 20% stake up for grabs after the Chinese cornerstone consortium invested earlier this year….while in Chicago the SEC is taking more time to consider the Chinese acquisition of Chicago Stock Exchange.

And there’s more, happy scrolling:

In BigWorld

It’s a big day for Britain as a binary option unfolds. The General Election can only produce a significant Conservative Party majority, or, Britain risks simply overturning in a fashion akin to the New Zealand Americas Cup yacht. Despite the mediocrity (in many senses) of Theresa May being (finally) unmasked, the alternative is simply dire – fanatical terrorist supporting extremist Jeremy Corbyn is perhaps the least patriotic British party leader in history apart from his ‘friends’ in the Sinn Fein political front for the IRA from the 1970’s. There are no other credible party leaders in this election – Britain needs a strong Brexit leadership and only May’s Conservative party is remotely equipped to achieve this. I still anticipate a larger majority, could be 100 seats but it looks like an interesting popcorn evening for the UK as results flow in – circa 0200 CET we ought to have some clarity.

Across the Atlantic, the fake news flow will go all retro as everybody tries to find evidence of Watergate in the contemporary White House today. Yet a read of the Comey testimony reveals a figure who has nothing to add to the tedious media agenda of defenestrating Trump at all costs. Expect the Communist News Network and other vendors of untruth to work up a lather when it all looks like much ado about nothing, apart from Mr Comey having a dubious grasp of his actual role (as was).

Public Markets

New JV Will Support China- Hong Kong Bond Connect
South China Morning Post

PLY: On the macro, a word of plaudit to Charles Li. He looked seriously endangered not that long ago and has weathered various storms while doggedly pursuing the China gateway strategy. That approach looks stronger than ever with Bond Connect the latest tangible addition to his linkage portfolio.

ICE CEO Warns UK Not To Take Presence For Granted Post Brexit

PLY: Repeats the stories of yesterday but sufficiently vital that it needs to be taken seriously. Miles Celic and the City UK amongst others have to ensure they beat a path to the door of the government ASAP post election as the UK is taking its incumbency seriously for granted and upsetting key foreign investors is just plain dumb. Britain needs a reset in business relationships to make Brexit work.

DD Special: UK Elections And M&A
Financial Times

PLY: Scroll down for some highlights from IDX, focussed on the clear, concise thoughts of Jeff Sprecher.

LCH Urges EU To Avoid Forced Relocation Of Euro Clearing
London’s Biggest Clearing House Open To More EU Oversight

PLY: Reports remarks at IDX of LCH COO Dan Maguire. Nobody objects to more oversight where it involves clear data sharing and ability for the ECB to better understand the systemic risks. The problem is that the EU has a problem with avoiding crazed collegiate approaches to dictating how markets work – often with a somewhat “Canutian” framework of micromanagement…which will curse the Euro’s already troubled genesis. Meanwhile, if you have not already, don’t forget to check out Barney Reynold’s excellent OpEd piece also from the Bugle: EU-managed control of Euro clearing is not viable.

EU Watchdog Rules Out Further Delay To Markets Reform
Fat Chance of Delaying Markets Reform EU Watchdog Tells City

PLY: The curse of MIFID II still looms large as the EU doubles down on its ludicrously flawed, overly ambitious sequel to the coherent MIFID.

Next EU Bank Stress Test To Be Tougher On Bad Loan Accounting

PLY: QV future exchange M&A. Banks are sellers…

Deutsche Boerse Says Open To Index And Data Business Deals

PLY: I hadn’t realised Rich-fest was already underway yesterday but DB1 CFO Gregor Pottmeyer was trying to offer some deal catnip to investors. If only DB1 would stick to their knitting – but the problem is the C-suite seems to have forgotten the yarn-needle threading thing.

London Stock Exchange Group Plc Transaction In Own Shares

Private Markets

Pakistan Stock Exchange Starts Bidding To Sell Its 20% Stake
The Express Tribune
SECP Extends PSX Bookbuilding By One Day For IPO
The News International

NSE To Take Consent Mechanism Route To Settle Preferential Access Case With Sebi
Economic Times

SEC Takes More Time To Mull Chicago Stock Exchange’s China Deal

Special Section: FTI, NSEL, India at the Crossroads

No news today.


Remarkably no news, would have expected something from IDX and it was the London LineData Exchange conference yesterday if food admin floats your boat…


Tradeweb To Open Early On Friday After Uk Election
New York Times

Fixed income trading platform Tradeweb said it would open early on Friday due to Britain’s general election.

ICE Expands London Gold Contract Ahead Of LME’s Rival Offering
A Clash Of New And Old For The Lost Heart Of Metals Trading?

PLY: The metals market does bad blood with such an aplomb the showdown with Martin Abbott, enriched by LME on their acquisition of LME, has shades of John Grisham about it.

Stock Market Volatility Will Erupt Again – Trading Execs Warn
Financial Times

PLY: Platforms – correctly – talking their own book, backed up by the excellent Emanuel Derman who was a guest speaker at the Sandler O’Neill conference.

Hong Kong’s HkEX Improves Trading Conditions For RMB Currency Futures
Finance Magnates

Is One Of Our Major Financial Markets Vulnerable To Price Manipulation?
Pacific Standard

PLY: Arguments about ViX…

Career Paths

ESMA Appoints New Chair To Investment Management Standing Committee

ESMA Launches Selection Procedure For Policy Officers


Australian P2P Lender Credit Crowd Joins Blockchain Lending Platform Othera
Crowdfund Insider

Fintechs Not Happy With Crowdfunding

PLY: Australian paternalism proving a frustrating issue for crowdfunding development as previously reported.

Other Stories

ESMA Updates MIFID II/ MIFIR Investor Protection Q&A

Betfair First To Offer Markets On Professional Drone Racing
Gambling Insider – In-depth Analysis for the Gaming Industry

PLY: Not sure what is the attraction to professional drone racing – which is distinctly different to competitive conference droning…pro drone racing involves high flyers for one thing. First it was NEX sponsoring a team now Betfair are the first to offer a market on outcomes…

HKEX – Latest Charles Li Direct: Bond Connect – What It Means And How It Works

CEOs Are Getting Fired For Ethical Lapses More Than They Used To
Harvard Business Review

PLY: Hopefully a trend which will flow through the parish as we can ill afford questionable practices by bosses in regulated entities.
I hope all UK voters will assiduously exercise their mandate.

All the best,


Patrick L Young
Executive Director DV Advisors

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