Transcript
This week in the parish of bosses and market structure, NASDAQ buys Verafin and the CFTC whitewash the Cushing crisis. My name is Patrick L. Young. Welcome to the bourse business, weekly digest. It's the Exchange Invest Weekly podcast.
The European Union's regulatory arm, ESMA, have proffered naked protectionism and blatant idiocy. They're telling European banks, they must trade derivatives inside the European Union after Brexit. Of course, that's completely going against the idea of - well - free trade and indeed all the other agreements that they have in the world.
Therefore you can trade derivatives in any old panjandrum of republics across the world, but not in London because: Brexit. Frankly, the European Union's naked idiocy of protectionism and Imperialist stand in a very, very bad tempered divorce where clearly the European Union is feeling the belittled spouse - is a mess.
In the medium term expect to see serious financing pressure build in the European Union. As banks face higher costs of funding, higher margins, and much more else besides this is not what the European Union can afford, nor the crumbling Eurozone, as it heads into 2021 under a serious Credit crunch, which is looming across a banking system on the continent of Europe that is already in huge problems, across many nations, such as Italy ...problems, which have land unresolved for over a decade thanks to the vacillation of the European Union's failed political classes. This will not end well so long as the European Union pursues its myopic post-Brexit policies as an attempt to punishment beat Britain.
Elsewhere the regulatory blob: having a particularly good week. The CFTC, the Commodity Futures Trading Commission in the USA, they have, well, unfortunately - we expected this all along entirely- whitewashed, the Cushing crisis.
The CFTC process has been exposed as hideously inadequate to put it mildly.
Absolutely. Zero buddy has had a good word to say about the regulator in my inbox, since this announcement, after what is perceived as a whitewash.
Elsewhere regulators margin models have been ruled to be too lax. According to a BlackRock executive Eileen Kiely, an MD specializing in clearing house risk management, at, BlackRock argues that there are holes in the rules….
At the same time in the New York Post, an excellent editorial, “this soak, the rich tox would destroy the economies of New York and New Jersey.” That is of course the Financial Transaction Tax proposed at the server level, which caused the governor of Texas. Mr. Abbott, to note the fact that the stock exchange coalition, visiting him with a view to relocating their servers and trading of Wall Street there were very impressed after a trip to the Texas Governor's mansion. Elsewhere speculation this week that while Deutsche Boerse will own most of ISS assets, the shareholder proxy service, it won't control it. That at least according to the words its CEO made: ISS president and CEO, Gary Retelny.
Frankly, dreams are free. What I perceived in the Zoom stream of the DB1 investor day was an entirely supplicant. If not outright fawning Mr Retelny towards his new boss, Teodore Weimer, as noted in the previous week's podcast. And indeed in the pages of Exchange Invest itself every day.
I don't think this ownership structure will work in the real world conflict of interest front, and indeed it gets worse because now DB1 is backing the ISS in a lawsuit against the American SEC. That's all about reigning in the influence of the likes of ISS and Glass Lewis, who issue guidance to investors on everything from the executive pay to mergers and acquisitions.
Having bought the business last weekend, Deutsche Boerse has jumped in to suggest that it would like to support this...
