160 Exchange Invest Weekly Podcast September 10th, 2022

Exchange Invest
Exchange Invest
160 Exchange Invest Weekly Podcast September 10th, 2022
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Transcript

This week in the parish of bourses and market structure:       

Narain is nicked. Another former National Stock Exchange of India CEO gets arrested. 

There’s a tale of Two JSE’s over in Johannesburg, it’s curtains for the plan Technology Board while in Jamaica, optimism remains around the junior market. 

Is El Salvador’s BTC DOA?

The obituaries are in concerning the El Salvador Bitcoin currency play from Steve Hanke and Bloomberg amongst others.

And particularly in Europe, there is an Energy Market Meltdown. 

The damning news for Europe is that even JP Morgan, led by Euro poodle and perennial Davos man on the wrong side of future trends, Jamie Dimon, has begun moving staff ex-Frankfurt to London in order to avoid working by candlelight (presumably while powering their Bloomberg terminals with pedal power?) 

There is of course a solution – it’s called free markets and less kissing up to deranged dictators full of gas. 

My name is Patrick L. Young.

Welcome to the bourse business weekly digest.

It’s the Exchange Invest Weekly Podcast Episode 160.

Good day ladies and gentlemen, this is a very brief reduction of highlights amongst the key headlines from the week in market structure. All the analysis of the many events and happenings from the past seven days can be found in Exchange Invest’s daily subscriber newsletter, the unique guide to the bourse business sent daily to your inbox.

More details at ExchangeInvest.com.

Ukraine’s President Zelenskiy ‘rings’ the New York Stock Exchange’s bell virtually this week. He’s seeking $400 billion in foreign investment. It was a fine moment of symbolism as the New York Stock Exchange rightly saluted Ukrainian entrepreneurship and ingenuity at a grim time in the nation’s history. Hopefully, the Russian invasion will end soon and more hopefully still be there after Ukraine can become a more open, less corrupt society to enable its economic potential in which we can all feel comfortable to invest.

 in India, the enforcement directorate, they have arrested the former NSE MD-CEO Ravi Narain that’s in a money laundering case. A shocking development in the “Holy Hoax” unraveling of the NSE’s pest management as now Ravi Narain being arrested in this money laundering case is amongst one of several pending actions against the exchange and its staff, that makes Ravi the second former CEO of NSE after Chitra Ramkrishna (currently on a lengthy period of incarceration without bail) as we watched the descent of the NSE from the one-time poster child of electronic Indian stock trading and indeed still a hopeful IPO candidate, which is nowadays encountered difficult legal times. 

The Johannesburg Stock Exchange has frozen the plan to launch a technology board despite overwhelming support from institutional investors, audit firms, and listing sponsors. Meanwhile, in Jamaica, the JSE have reached a historic landmark of 100 listed companies and their CEO Marlene Street Forrest, who is, I believe, going to retire later this year, is still bullish on the junior market of the Jamaica Stock Exchange too.

Overall, China has been enhancing Hong Kong’s status as a global financial hub, adding overseas stocks to the cross-border trading scheme, that’s known as Connect. Those new initiatives are being welcomed by all parties, and indeed, China further opened its domestic derivatives markets during the course of the past week enabling foreign investors further access if they’re qualified overseas institutions to trade what has been previously broadly domestic futures and options instruments. Of course, the macro event to watch in China is the upcoming 20th Party Congress on October 16th.

Results, just one set but very interesting numbers they are this week from the parish, The International Stock Exchange (TISE), that’s the Channel Island stock exchange as was. They announced pretty encouraging results for the first half of 2022. Actually, I’d call them very encouraging results, profit after tax was -14.5% but given the fact that overall listings have been drying up in lots of places, they managed to record a turnover of 4.9 million pounds ($5.7 million) which is +2.5% equally they didn’t see a cataclysmic fall off in the number of listings, 487 securities listed during the course of the first half of the year. 

New markets, Bangladesh is looking at its first commodity exchange by the end of this year, the Chittagong Stock Exchange planning to launch that, and Aquis Exchange, they’ve launched a new market. Well, it’s new to them, it’s a pan European dark pool, it’s going to be called Aquis matching pool that accelerates the development of the Aquis Stock Exchange business, and indeed, Aquis is going to be accelerating the platform itself onto its own technology in the near course of time, which can only further AMP up the former UBS MTF which Aquis acquired a few months back now going to be issued with double UK and EU dark pools. 

If you’re trying to understand what the world of markets means, whether it’s a dark pool, blockchain, cryptocurrency, or something else, don’t forget my recent book “Victory or Death?”. It came 20 years on from the “Capital Market Revolution!”

“Victory or Death?” is published by DV Books and distributed by Ingram worldwide. Moreover, coming on Tuesday while you’re waiting for your copy of “Victory or Death?” to arrive, check out our Livestream Tuesday 6pm. We’re back, we’re going to be discussing Exberry: Building Cloud Based Exchanges with guests Guy Melamed & Magnus Almqvist of the Exberry organization. 

In crypto land this week, Indonesia is looking to launch a crypto exchange by the end of 2022. Meanwhile, Binance chief CZ has been reiterating in a lengthy blog post that Binance is not a “Chinese company”. At the same time, a few international developments, a Nigeria Binance partnership is in talks to create a digital city to develop blockchain in West Africa. 

Coinbase they have a bit of nasty this week, a mispricing issue allowed users in Georgia to cash out their positions for 100 times what should have been the rate. Ultimately, Georgia and Coinbase users who profited from the hours-long price bug found their bank accounts locked while the exchange demanded its money back. It’s an ugly standoff, Coinbase looks amateur and has exacerbated yet another PR egg-faced with their actions at the same time as proclaiming elsewhere in their agitprop in the course of the last week “Coinbase is the most trusted platform for buying, selling, and exchanging digital assets”  The question is does that really stand up to reality? And indeed, more importantly, is it the behavior becoming of even the well mere $10 billion plus market cap business that Coinbase says these days? 

Product news this week, the European energy crash was mega, Sweden and Finland stepped in to for power companies. In fact, people are saying that it may even be bigger in terms of the bailout than the Lehman financial crisis of 2008. Of course, that was the crisis over the Russian invasion of Ukraine being exacerbated by a typically daft EU attempt to control prices top down at the end of last week, which led Russia to properly close the Nordstream pipeline. 

“I’m here from the government I’m here to help”. Once again, Reagan’s most terrifying maxim proves damningly correct as Germany’s lead sponsored by a supplicant and short-term ‘stupid’ (there’s no other word for this), and long-term moronic likewise, European Union threatens to turn the European Union nations back towards an energy insecure password candles look like groovy innovations. This is absolutely squarely the fault of the government, as a lead if you can call it led by the Russian sleeper agent Angela Merkel (there is surely no other explanation or justification for her appalling leadership these days). Can there be?

In terms of an unmitigated catastrophe which now threatens the European lifestyle (once the richest in the world but no longer), the fissures may yet take down the Euro and the EU itself – at which stage Brussels will have only itself to blame.

On the energy points and specific to our markets, a chill wind of socialist critique is now embracing the media and more: Think tanks pushing anti market rhetoric and somehow people suggesting that TTF is actually to blame for this whole thing, which is, well, frankly, laughable, but a sick joke. 

It’s an ugly week for power markets, it has been an ugly week for the politicians who have failed the people but more importantly, despite the short-sightedness of the political classes, EEX, ICE, and NASDAQ all deserve plaudits for their ability to run markets against a purely chaotic back backdrop. 

Elsewhere in product news, the Baltic Exchange and Zhengzhou Commodity Exchange have agreed on an MOU for Panamax futures. LCH CDSClear has gone live with clearing for iTraxx Australia indices and single name constituents and Egypt have put their plans on ICE for a few months after the Russian invasion of Ukraine, they are intending to privatize 10 government companies via the stock exchange during the course of the year. Finally, in product news, this week, the Beijing Stock Exchange they’re going to launch their first index for small and mid-sized enterprises known as the BSE 50

Technology news, MCX is in talks with 63 moons to renew their service contract. MCX having reversed itself into a fiasco due to the failure of Tata Consulting Services (TCS) to deliver the solution agreed, according to the timeline of their contract, it does not require a great deal of intellectual application to correctly allocate the phrases “upper hand” and “under pressure” respectively, to the appropriate party to this negotiation. 

Over in Zimbabwe finally, in technology this week, Victoria Falls Stock Exchange (VFEX) have launched its online trading platform.

Regulation news, the backlash continues on the SEC‘s proposals concerning proprietary trading. The notion that actors – whether individuals or corporate bodies – must register with a regulator to speculate or hedge using their own capital when not undertaking client activity are beholden to market making practices, ought to be anathema to the whole notion of regulation. However, when you have a rather despotic control, freak style of management, passing as a US government and indeed passing as the chairman of the SEC, there is a regulator with a knick-knack for overreaching edicts, and that’s where we end up it’s a ridiculous concept proprietary trading should be free of regulation. 

SEBI has warned algo trading brokers against promising high returns to protecting investors, which is a reasonable approach and the overall past performance is no guarantee as to future outcomes world of regulatory advertising. 

Career paths this week at former CFTC Commissioner Jill Sommers has joined the FTX US Derivatives Board. At least it’s encouraging to see FTX attracting female talent from beyond the pages of Vogue for once. 

There’s a new director of the Costa Rica National Stock Exchange, he’s on a mission to make the capital market a country project. All the very best to César Restrepo Gutiérrez who will be taking over on November 17th. He currently works for the Colombian Stock Exchange.

 In “Big World” this week. Gosh, it’s hard to know where to start. One could mention that it’s only 4 years not even four years since the UN General Assembly of 2018 when Donald Trump noted “Germany will become totally dependent on Russian energy if it does not immediately change course”. 

How the German delegation laughed out loud at that point in time. “Trump has well never been the best vessel for the communication of truth” as Douglas Murray noted in the spectator, but in this case, it’s difficult to argue just how right he was.

Elsewhere, we had an obituary written on El Salvador’s Bitcoin experiment. El Salvador Had A Bitcoin Revolution. Hardly Anybody Showed Up when the rather withering headline in Bloomberg, which also accompanied a National Review article by amongst others, The Economist Steve Hankey. 

“Since there’s a weak rule of law in El Salvador, the “forced tender” provision of the Bitcoin law has no teeth. As a result, most Salvadorian businesses – 80% – refused to accept Bitcoin as a medium of exchange” noted the Hankey paper.

It went on to add “The verdict is in on Bukele’s Bitcoin experiment, it was based on false promises from beginning to end. A total failure.” 

How remarkable it is, ladies and gentlemen, that dropping in an already outmoded, energy intensive, and not very scalable asset could result in a national failure of currency replacement. Unless you were reading Exchange Invest, of course. 

And on that bombshell, ladies and gentlemen, that mysterious and magnificent note, it only falls to me, Patrick L. Young, publisher of Exchange Invest to exhort you to try free trial to our newsletter ASAP and also wish you until episode 161 of this podcast, to have a great week in blockchain, life, and markets.

LINKS:

Ukraine’s Zelenskiy ‘Rings’ NYSE Bell, Seeks $400 bln In Foreign Investment
Reuters

ED Arrests Former NSE MD-CEO Ravi Narain In Money Laundering Case
Hindustan Times

Ex-NSE CEO Ravi Narain Arrested In Laundering Case
Times of India

JSE Freezes Plan To Launch Technology Board
ITWeb

Jamaica Stock Exchange Reaches Historic Landmark Of 100 Listed Companies
Jamaica Observer

Street Forrest Still Bullish On The Junior Market
Jamaica Observer

China To Enhance Hong Kong’s Status As A Global Financial Hub, Adding Overseas Stocks To Cross-Border Trading Scheme
South China Morning Post

China Further Opens Its Domestic Derivatives Market

Nasdaq

TISE Announces Strong Results For H1 2022

TISE Unaudited Interim Financial Report
TISE

Bangladesh’s First Commodity Exchange By This Year
The Daily Star

Aquis Exchange Launches New EU Dark Pool, Aquis Matching Pool (AMP)
Aquis Exchange

Indonesia To Launch Crypto Stock Exchange At End-2022
Yahoo Finance

Who Is Guangying Chen, and Is Binance a “Chinese Company”?
Binance Blog

Nigeria, Binance In Talks For Digital City To Develop Blockchain
Bloomberg

Coinbase Mispricing Allows Users in Georgia to Cash Out for 100 Times Rate
CoinDesk

Sweden, Finland Step In To Avert Lehman-Like Situation For Power Companies
Reuters

Baltic Exchange and Zhengzhou Commodity Exchange Agree MOU For Panamax futures
Hellenic Shipping News Worldwide

Egypt To Relaunch Government IPOs Program On The Stock Exchange
Arab News

Beijing Stock Exchange To Launch Its First Index
Caixin Global

MCX In Talks With 63 Moons To Renew Service Contract
The Hindu Business Line

VFEX Launches Online Trading Platform
Herald

SEC Proposal On Proprietary Trading Sparks Backlash
IFLR

SEBI Warns Algo Trading Brokers Against Promising High Returns To Protect Investors
Outlook India

Former CFTC Commissioner Jill Sommers Joins FTX US Derivatives Board
PR Newswire

A New Director Of The Costa Rica National Stock Exchange Is On A Mission To Make The Capital Market A ‘Country Project’
JournalTime

El Salvador’s Bitcoin Experiment A Failure
National Review

El Salvador Had A Bitcoin Revolution. Hardly Anybody Showed Up
Bloomberg






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