MAY 11 2017

Just as we share an attitude of looking forward in linear and lateral fashion this is edition 992 of Exchange Invest which coincides with the “under development” 2020 version of the iconic 911 series… Hmmm to enhance my fund to buy one I may have to make this newsletter subscriber only before then. Food for thought.

Prosperity UK Video

Prosperity UK Panel – Brexit, Euro Clearing & Financial Market Structure: a panel ably chaired by Barney Reynolds headlining parish luminaries Jeff Sprecher and Michael Spencer, with one Patrick L Young lurking in the background continues to gain traction and it’s vital to spread the word methinks to add to clarity in the cloudy (at best) CCP debate post Brexit.

In Today’s Exchange Invest

Frantic day in the parish, CFTC launches “MOAB” as a shot across the bows of the EU/ECB/feral ‘remoanian’ Brexit deniers etc. TMX shares lose 8% but they think Aramco may list on Bay Street while HKEX launches LME Metals Week Asia with typical fusillade of messages. And there’s lots lots more…

Albeit parishioners may be pondering the brevity of Bob Greifeld’s term as NASDAQ Chairman. Without any fanfare he has been replaced, having only been installed replacing Borje Ekholm in January. Doubtless a very simple reason behind it albeit I expect a flurry of email from parishioners who don’t recall the notion Bob was an interim placeholder. At least we know La Friedman is clearly in charge.

Happy scrolling on another pith-laden day:

In BigWorld

Apparently the Macron honeymoon has already ended in Brussels according to Politico while Nikkei highlight the first warning shot from Carlos Ghosn – if only “Le CostCutter” could run the 5th Republic!

Meanwhile, think tank the IEA published the European ‘nanny state’ index. Worryingly Britain comes second thanks to all manner of needless impositions from the state – frankly not being able to drink a can of Irn Bru while recuperating in a Scottish hospital strikes me as one of the most moronic in a competitive field. Plaudits to Prague on the Czech Republic being the most permissive state in the bloc: EU Nanny State Index.

Nevertheless, despite Brexit, here’s a story it is hard to find in the Brussels Bugle / NYT and suchlike selective legacy media today: £70 Billion Fund Chooses London as New European HQ. Oh actually the Brussels Bugle prefers to find one ray of concern “UK Tech Investors Face Loss Of Significant Funding highlighting the EIF pulling its money (er, EU taxpayers money?) out of the UK. (Reminds me of a brilliant third party comment accompanying one of my YouTube videos on Brexit: “How Dare He Spread Optimism!”).

Public Markets

U.S. Watchdog Urges EU To Think Through Euro Clearing Changes

PLY: A few weeks back President Trump let off the Mother of All Bombs (“MOAB” or “Massive Ordnance Air Blast” if you prefer the non-tabloid military descriptor) with a fairly devastating result. From Washington via Lisbon through Brussels and onwards to Frankfurt yesterday that supersonic whistling noise you may have heard was the acting CFTC Chairman just delivering the swaps equivalent of the MOAB across the bows of the ship “CCP Euro-Titanic.”

Giancarlo adopts a diplomatic touch which is nonetheless crystal clear in leaving the EU/ECB nexus clear that it risks Mutually Assured Destruction:

“To date, the US has not deemed a body of water – even as large as the Atlantic Ocean – as an impediment to effective CCP supervision and examination. Given the closeness of the US and European derivatives markets, what Europe chooses to do on the supervision of CCPs undoubtedly will inform the evolution of US regulatory policy for cross-border swaps clearing.”

The earlier paragraphs on how few folks actually want to clear swaps at GCM level in the US are instructive too – particularly given (per the answer to Martyn Watkins’ Prosperity UK panel question) the EU 27 (let alone the Eurozone) doesn’t have the clearing capacity to actually service an EU-centric swaps clearing market in its own right. Never has “be careful what you wish for” so neatly coalesced with a veritable “mountain range in the carpet” than the EU’s current deeply flawed protectionist stance.

HKEX Qtrly Net Profit Rose 20 Pct
HKEX’s Q1 Earnings Signal Strength For Group As Revenues Surge
Finance Magnates

PLY: Good numbers. Charles Li in interesting form. Positive yet also apologetic for past LME foibles as he looks to push the group further ahead at what is a fascinating time for the HKEX Group.

Thomson Reuters ‘ First-Quarter Sales, Profit Top Expectations | Reuters

TMX Group Shares Fall 8 Percent As Earnings Miss Estimates
TMX Group Limited Increases Dividend To $0.50 Per Common Share
PR Newswire (press release)

PLY: The smiles in Toronto were clearly on the face of the Thomson family as their data vendor pumped out encouraging numbers as TMX stock sank on the lack of direction in the legacy national marketplace.

HKEX Backs LME To Create ‘Home Depot’ Style Market
Hong Kong Bourse Chief Ready To Listen As LME Plans More Reform
The Star Online

PLY: An arresting headline which is really an encouragement to LME participants to address the thoughtful discussion paper published by the exchange a few weeks back.

Two Sigma to acquire Interactive Brokers’ US options arm
The Trade

The acquisition completes Two Sigma’s journey to expand into the US options market, as it looks to reinvigorate Timber Hill business.

PLY: Very interesting deal – how the Timber Hill market makers access what is now IBKR’s network will be interesting to see in practice.

LME Clearing House Says Interest Growing To Use Metal As Margin Collateral
The Star Online

PLY: It’s all happening in Qianhai as LME Asia metals week kicks off in the economic zone built on reclaimed land where the HKEX Chinese mainland commodity exchange is also planned.

Nairobi SE Moots Employee Share Scheme
Business Daily (press release) (blog)

London Stock Exchange Group Plc Transaction In Own Shares

PLY: No news of any more sales by Xavier today as LSE relentlessly underpin their stock.

Bursa CEO: Learn Basics Of Investment To Avoid Scams
The Star Online

PLY: Heartening to see the Malay language clearly doesn’t have a word for ‘snowflake.’ Sound advice from the exchange CEO.

Private Markets

OSTC Spins Off FX Division To Form Godi Financial
Global Investor Group

PLY: Interesting.

Special Section: FTI, NSEL, India at the Crossroads

No news today.


BME And The Bolsa Of Costa Rica Agree On The Distribution Of Openfinance Technology For The Management Of Investments In Costa Rica

Citadel Securities, XTX Markets Join Blockchain FX Venture Cobalt

AST To Deliver Blockchain-Based Proxy Voting Solution – Company Working With Blockchain Specialist To Accelerate Delivery Of New Technologies That Enhance Transparency, Speed And Accuracy Of Data


LME Throws Hat Into Ring To Run London Silver Price Fix

HKEX To Begin Consultation For A New Third Board End Of May
South China Morning Post

SGX’s New DKI Index Meets With Scepticism
Interfax Global Energy

NYSE Executives To Woo Aramco IPO In Upcoming Saudi Visit

PLY: Thus contradicting something published in a London journal recently that the Saudis would snub New York.

Toronto Exchange `Legitimate Contender’ For Aramco IPO, Ceo Says

PLY: On days where your stock price is plunging 8% as more people realise that as a strategy even a Potemkin village may be beyond your abilities, I suppose a desperate CEO you might be inclined to just say anything to grab a headline.

Deutsche Börse Expands Offering For Start-Ups

Career Paths

Nasdaq Stockholders Elect Members To Board Of Directors – New Director, Melissa M. Arnoldi, Elected To The Board And Eight Directors Re-Elected – Nasdaq Board Elects Michael R. Splinter As Chairman Of The Board

PLY: So the big news is that Bob Greifeld has stepped down as NASDAQ Chairman having only begun in the position January 1st.

The Greifeld era certainly saw an incredible turnaround in the NASDAQ business from a stock market which had a chip on its shoulder over not being recognised as such for many years to a genuine 10 billion dollar international powerhouse. I salute Bob Greifeld for what he achieved.

Farewell too former Chairman Borje Ekholm who has stood down.

Limaye’s NSE CEO Job In Balance, BCCI Told To Drop Contentious Deal
Business Standard

PLY: SEBI appears to maintain a view it can control the exchanges as opposed to regulating them. This delay over Vikram Limaye because of his links to the governing body of cricket is another example of heavy handed regulation which discourages trust in the Indian system.

ISDA Appoints Pension Fund Expert To Board And Elects New Board Members

Nominations For Directors – NZX Limited

Axioma Appoints Technology Veteran Mark Traudt, Bolstering Leadership Team – Leading Industry Executive Joins As Head Of Product Engineering

Cobalt Announces Expansion Milestones – Announces New Launch Participants Citadel Securities And XTX – Opens New US Office – Appoints New COO, Head Of Product And Head Of Solution Delivery And Support

PLY: Finally good luck to Patrick Thornton-Smith who has stood down from his role at Duco and left the parish to become a non-executive directors of the Wine Investment brokerage – cheers Patrick!


Bitcoin Lender Bitbond Nets €5 Million To Fund New Loans

PLY: Great news from the energetic team at Bitbond – well done!

Other Stories

FSB Publishes Global Shadow Banking Monitoring Report 2016

Opening Remarks Before The SEC Advisory Committee On Small And Emerging Companies, Chairman Jay Clayton, May 10, 2017

Opening Remarks At SEC-NYU Dialogue On Securities Market Regulation: Reviving The U.S. IPO Market, Commissioner Michael S. Piwowar, New York City, NY, May 10, 2017

SIFMA Executive Vice President Randy Snook Remarks At The 2017 Operations Conference And Exhibition

ISDA Chairman Eric Litvack’s Remarks At ISDA 32nd Annual General Meeting, Lisbon

New ISDA Animated Video: How Do Derivatives Benefit The Global Economy?

Remarks Before The SEC Advisory Committee On Small And Emerging Companies, SEC Commissioner Kara Stein, May 10, 2017

HKEX – Latest Charles Li Direct: Taking The First Step Towards Building A Long-Term Commodities Platform In China
Thank you for reading Exchange Invest, and the end of the Greifeld era at NASDAQ – a poignant day!

All the best,


Patrick L Young
Executive Director DV Advisors

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