132 Exchange Invest Weekly Podcast February 19th, 2022

Transcript:

This week in the parish of bourses and market structure:

Latency Lust Bites National Stock Exchange of India on some Valentine’s Day while NASDAQ’s reshuffling their IT sales management in the week NYSE appears to be going full NFT.

My name is Patrick L. Young.

Welcome to the bourse business weekly digest.

It’s the Exchange Invest Weekly Podcast Episode 132.

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 of 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.

The new New York Stock Exchange President Lynn Martin has noted that the iconic trading floor on Wall Street is not going away. At the same time modernity rules within the New York Stock Exchange itself, they filed a trademark application for their NFT marketplace. That comes in a week when we actually saw the platform which sold an NFT of Jack Dorsey’s first tweet for $2.9 million, named Cent, which had 150,000 users on revenue “in the millions” decided to halt transactions because people were selling tokens of content that didn’t belong to them. The CEO said the issue of fake and illegal content exists across the industry.

And indeed this week the South China Morning Post brought us a story when noting that China’s board Wukong had been accused of copying the Bored Ape Yacht Club.

One exchange closure this week, the Indian Commodity Exchange (ICEX) is shutting its doors and applied to be delisted with the Securities and Exchange Board of India the regulator, SEBI. They had a busy week. In fact, SEBI rather knocked a hole in the wall of the National Stock Exchange of India’s upcoming IPO plans as they reverted with substantial penalties against the bourse itself (o new products for six months is perhaps not overly gruesome, but the messaging is ugly for the former poster child of the market). And indeed remember, they are planning an IPO imminently.

Ravi Narain, one of their former CEOs has retired so we won’t presumably be seeing him returning for Sebi permission after his ban ends. But Chitra Ramkrishna, also a former NSE CEO looks to be career toast in the financial market. As to Anand Subramanian, who was a leading figure ultimately COO of the NSE he may yet occupy a curious footnote in parish history (as the story went in a 190-pages order issued late on Friday, the capital market regulators stated that the previous experience of Subramanian “was not relevant to the position for which he was appointed” and “frequent, arbitrary and disproportionate increases in his compensation” were granted by CEO Ramkrishna). Oh, and then, of course, there’s the case of the Himalayan mountain-based Hindu Yogi who appears to have been actually driving a huge amount of the policy of the NSE during the Chitra Ramkrishna CEO era. All in all, it seems a lust for latency (or power in some form or another) has led to a very sorry coda to the previously stellar history of NSE. At the same time, presumably, scriptwriters from Netflix or HBO are salivating at the prospect of this as a drama.

In results: the disappointingly parochial approach of management just isn’t working. That’s one message from the lacklustre results of CME and DB1 to take up to examples compared to their more dynamic peers this results season. Add to that indeed, we could also mention the likes of the ASX down under some have had a pandemic slowdown relative to the best in class. The other finding is that was CME rocketing 3% after its results were announced on the basis that CME had beaten some analyst expectations, perhaps we need a new cadre of analysts?

Anyway, the stasis continues to add at least three formerly dynamic parish names. However, their investor base appears passive to the point of Stockholm syndrome and thus it may be a long, long time before dynamism is injected once again into these formerly great properties.

As of last week, we had scintillating results, and let’s just name five of them to remind us about this results season: CBOE, ICE, NASDAQ, TMX and latterly Euronext were amongst those exchanges staking a claim to be growth engines of the future.

New markets this week: just one announcement but it’s a very exciting one, Sebi (the Indian regulator) they’ve given an in-principle nod for the Bombay Stock Exchange, preliminary authorization to enable Electronic Gold Receipts (that means they’ve given the nod to a Gold Spot exchange).

Deals news this week: well, first the disappointment -the Deutsche Boerse CEO Theodor Weimer says the big Merger & Acquisition deal is not on the agenda. In other words, DB1 is confirming it intends to bore us to death with a variation of the CME’s ‘undynamism’. That comes in the same week when Theodore Weimar added yet another lucrative board post. In this case, Knorr-Bremse he’s joining the board thereof the German conglomerate as a result of the AGM last week.

New Zealand Exchange – they’ve completed their superannuation acquisition from ASB and the Chilean Peruvian and Colombian Exchanges are moving forward to their operations on a single platform.

If you’re bamboozled by what goes on in the world of FinTech, Blockchain, Cryptocurrency and so on, then you want to be reading my latest book “Victory or Death”. FinTech ultimately can kill your career and 20 years on from the excitement of the original FinTech best-seller “Capital Market Revolution!”. It’s time to look at some of those loose strands. Whether you are an exchange parishioner, a FinTech professional, or anybody just trying to stay ahead of where technology is now driving investments and finance, “Victory or Death” is published by DV books and is distributed by Ingram worldwide.

Don’t forget to check in to our Livestream, which takes place on Tuesdays at 6 pm London time. This week we have an incredible linkage we linked up Kenya, Gibraltar and indeed Harringay in North London, where we were listening to Henrik Hasselknippe of Xpanisv Markets talking all about the fascinating nexus between carbon and sustainable markets. Coming this week we’re gonna have a fascinating discussion on inflation. That topic is on everybody’s lips.

One Cum-Ex story this week: a former Warburg Banker has got three and a half years for the Cum-Ex fraud and his role in it.

In crypto land this week: Binance is buying a $200 million stake in Forbes Magazine that comes barely two years since Binance was attempting to sue the self-same publication.

Product news this week: amid a welter of announcements amongst others. The news is that Euronext will be launching the AEX ESG Index to meet the market financial community’s sustainable investment needs. ICE benchmark administration continues to tweak the interest rate world post-LIBOR, they’ve launched a Beta ICE term SOFR reference rate package.

All the news of course in the product was in Exchange Invest, the daily newsletter of the bourse business and also at the watercooler of the bourse businesses week, we covered technology news. Highlights this week: the Turkish Exchange Borsa Istanbul and also the UAE Stock Exchange in Abu Dhabi, the Abu Dhabi Securities Exchange, they’ve signed a cooperation deal. They’re going to be providing Borsa Istanbul implementation, consultancy support, etc. to the Abu Dhabi Securities Exchange in the IT field.

Sri Lanka’s Exchange had a slight whoops nasty, one of their days closes on a Wednesday was trimmed by nine minutes due to a technical fault, while the Wiener Börse finally the news is out after only a decade of work on the product behind the scenes, they’re cooperating with a fintech Wallstreetdocs for the automated listing of structured products.

Regulation news this week: the CFTC chair he’s pushing hard for Congress to give him the authority to regulate some cryptocurrencies. Over at the SEC, they voted in favor of the T+1 settlement but of course that comes with the caveat. Remember, the industry itself in the USA said, we’ll be delighted to offer T+1 but then give a T+1000 or so day timeline in order to manage to implement it.

Meanwhile, Andrew Bailey, the head of the Bank of England, he’s called for an indefinite waiver on European Union’s lenders access to London clearing something which the dogmatic Commissioner McGuiness seems to be trying to close the door on despite the fact that it actually flies in the face of all known precepts relating to well that very simple concept of an internationally exchangeable currency.

Career Path news this week: here was a great example of the Exchange Invest advantage. Last year in edition 2079 of the Exchange Invest newsletter, I noted that the ASX CEO Dominic Stevens was highly likely to be leaving his position and not seeking a renewal of his contract. It was entirely unconfirmed at that stage, but here we are not even nine months later, and we find ASX CEO Dominic Stephens is leaving the firm. That’s after spending some $250 million not to deliver a blockchain settlement service replacing the CHESS CSD technology.

Euronext Security’s Oslo appointed Kristine Bastøe as CEO.

Big news from NASDAQ – they’ve announced the retirement of their market technology EVP Lars Ottersgård. Lars Ottersgård is calling it a day on his lengthy NASDAQ tech career and he’s handing on the direct parish sales baton to veteran Roland Chai who’s been working with NASDAQ for a few months now after a long career with the likes the Hong Kong Exchanges and the LCH. Meanwhile, the Verafin CEO and President (and co-founder in 2003) Jamie King will be elevated to Executive Vice President at NASDAQ and will assume the leadership of NASDAQ’s Anti-Financial Crime (AFC) business. Congratulations to all on a very interesting reorganization.

Meanwhile, in ‘Big world’, fortunately, the Winter Olympics have rapidly descended into rows about teenage drugs use. For a few dangerous days, it looked as if we might actually just be able to enjoy the sporting spectacle such as skiing and ice skating. Thank goodness the lawyers are back in the limelight.

That of course comes in the week when we also saw a $4.5 billion Bitcoin money laundering scheme arrest. It’s rare to have a rapper arrested for a felony as bloodless as money laundering. At the same time and music lovers may think that CryptoKaleo possibly deserves jail time just for her infamous rap yodle all about the wonders of holding Bitcoin.

And on that mysterious and magnificent note ladies and gentlemen, my name is Patrick L. Young, Executive Director at Valereum PLC and publisher of Exchange Invest, the daily bulletin of the bourse business, wishing you a great week in blockchain, life and markets.

We’ll be back with another weekly podcast review of the world of bourses next week!

LINKS:

New NYSE President: Iconic Trading Floor Is Not Going Away
Yahoo Money

NYSE Files Trademark Application For Its Own NFT Marketplace
CoinDesk

New York Stock Exchange (NYSE) Files A Metaverse Trademark For Trading NFTs
Finbold

ICEX To Shut Commodity Operations; BSE, MCX To Be Biggest Gainers
Zee Business

An Appointment That Cost NSE And Its Former CEOs Dearly
Business Today

NSE, Two Former CEOs And Others Face SEBI Action
The Economic Times

SEBI Penalises NSE, Former Chiefs Over Lapses In Senior-Level Hiring
Business Standard

Fall Of A Guru: NSE’s Recurring Problems Point To A Breakdown In Governance That Needs Wider Investigation
Times of India

CME Group Inc. Reports Fourth-Quarter And Full-Year 2021 Financial Results
CME

CME Group (CME) Q4 Earnings Beat, Revenues Miss Estimates
Nasdaq