Clearing and Settlement News

News 120120: NYSE DB sunk, Japan PTS 5%, Purematch, RBS, Penson Aust....Costa Concordia, Otago Rail Trail trail!

2012-01-25T03:03:00.000-08:00

This week-end it’s back into the lovely, lovely ocean.

WooHoo...

36thWarriewood to Mona Vale Ocean Swim

http://www.oceanswims.com/Events/EventDetails.asp?EventID=313&EventScheduleID=&EventRegistrationID=25023

Mind you, those sharkies appear to be getting a bit nippy...

http://www.bbc.co.uk/news/world-asia-16632606

http://news.yahoo.com/witnesses-aussie-shark-attack-jaws-003144393.html

...But fatal attacks are rare in Australia, with just 27people killed in the past 22 years.

I spent most of last week doing a father and son bike ridewhich had kindly been organised by my son’s school.

Son number 1 was one of only 3 boys in his year to undertakeand complete the challenge.

We did some extra rides off the trail too, that were alsoquite challenging.

It was great to see the overall improvement in ridingskills, amongst so many other things, during the shared ride.

I can only recommend NZ. Great countryside, great people andfor a small country, some of their infrastructure has been planned and executedon a heroic scale. Respect.

The Otago Rail Trail...

Canal Ride:

http://www.endomondo.com/workouts/nPrFZS95F9g

River Ride:

http://www.endomondo.com/workouts/jpP6d9bJAUw

Rail Trail, Clyde to Alexandra:

http://www.endomondo.com/workouts/oYswg23d6Ts

Rail Trail, Alexandra to Lauder:

http://www.endomondo.com/workouts/qDB0KiN4FZA

Rail Trail, Lauder to Ranfurly:

http://www.endomondo.com/workouts/oWlF5Fn2dUE

Rail Trail, Ranfurly toMiddlemarch:

http://www.endomondo.com/workouts/tQY21heHCik

Coast Road:

http://www.endomondo.com/workouts/oo2ItKlshOA

The other thing I’ve done this week is some blog housekeeping.

That said, if I don’t have an up to date email address foryou please let me know.

I do (eventually!) post all emails at http://clearingandsettlement.blogspot.com ... the whole point is having somewhere to search these stories!

...I feel a one sided ocean cruise ship theme coming on....

NYSE Euronext / Deutsche Bourse deal to get scuppered in EU.

Canada’s Alpha lists a bit.

Japan could open the flood gates for PTSs

The CXA story interested me...as much for the comment thatASX Purematch has yet to take on any water (liquidity).

SIX Swiss exchange have problems on the bridge.

Pipeline...sunk in favour of Aritas

Rant 1: I think it’s pretty irresponsible (or ignorant) ofthe financial media to report on middle eastern web site attacks. Who cares?Surely this just throws fuel onto an irrelevant fire? Trading platform outages,yes, that’s got the potential to be material...a web site down for a bit?Please. This is useless reporting. Grrr

Rant 2: On clearing I should be ranting about the newinteroperability regime.

I did start reading some of the trade comments but yet againthere is a failure of complete disclosure.

Forexample, Andrew Bowley fails to disclose he is a NED at EuroCCP....so it wouldbe hard for him to advocate clearing anywhere else. I still feel competitiveclearing in Europe is still vested interests and not about competition.

The good news is, the World Bank appears to have picked thebottom of the market (a la Costa Concordia!)

RBS scuttles equity business line.

BNY re-floats Penson

In Manchester, it looks like crime does pay, but they needto do more cost benefit analysis.

I like the Plastic Jungle exchange concept.

Well, enough from me.

As a modeller in my boyhood this one appealed to me:

A boy goes into his local toy shop and asks if they stockany Italian Cruise Liner models.

“Yes” says the shop keeper.

“Would you like me to put it on one side?”

Have a great week-end all.

s.riley.mail@googlemail.com

http://clearingandsettlement.blogspot.com/

Platforms

EUANTI-CHIEFS PREPARE TO TORPEDO DEUTSCHE BÖRSE/NYSE MERGER

Anti-trustofficials in the EU are prepared to block the proposed mega-merger betweenDeutsche Börse and the New York Stock Exchange over fears that the deal wouldstifle competition in the derivatives markets.

Moreon this story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23303

BLOOMBERG:TMX Group Gains Share of Canada Trading as Alpha Declines

TMX Group Inc. (X) extended its control ofthe Canadian market for equities trading in December after taking market sharefrom bank-owned Alpha Group and other alternative trading platforms.

TMX, the Toronto Stock Exchange ownerthat’s facing a C$3.73 billion ($3.66 billion) takeover bid from a group ofCanadian banks and pension funds, had 71 percent of the market across its threevenues last month, up from 65 percent in November, according to monthlystatistics from the Investment Industry Regulatory Organization of Canada.

http://www.bloomberg.com/news/2012-01-16/tmx-group-gains-share-of-canada-trading-as-alpha-declines.html

BLOOMBERG:Japanese Regulator May Lower Barriers to Alternative Trading

“The FSA arerightly thinking about liquidity from the perspective of the end-investor,”said Jessica Morrison, head of Asia Pacific market structure for Deutsche Bankin Hong Kong. “Making liquidity on alternate venues sufficiently accessible toall market participants, in order to provide best execution, is an importantand worthwhile priority to pursue.”

Regulatoryimpediments are hampering growth on Japan’s newer venues, Morrison said. Forexample, investors are required to make a takeover bid if they acquire morethan 5 percent of a company through off-exchange transactions with more than 10shareholders, she said. No such rule exists for shares bought on the mainbourses.

“If you wanted toput PTS on equal footing with the exchanges, you’d have to get rid of the 5percent rule,” Sadakazu Osaki, head of research at Nomura Research InstituteLtd

http://www.businessweek.com/news/2012-01-17/japanese-regulator-may-lower-barriers-to-alternative-trading.html

Chi-Xdetermined to make inroads

Attemptingto head off the new competition, the ASX in November unveiled a similarlow-cost trading platform, PureMatch. It has had little success so far,attracting no volume since it launched. An ASX spokeswoman said volume was notexpected until later in the year, after its new data centre was operating andit had more time to better target brokers.

http://www.theaustralian.com.au/business/markets/chi-x-determined-to-make-inroads-in-stockmarkets/story-e6frg916-1226247778385

VEGA-CHISETS 7 FEBRUARY LAUNCH DATE FOR BOND TRADING MTF

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42655

NZXCOMPLETES SALE OF CARBON REGISTRY TO MARKIT

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42646

ASX technology chief steps down

TheASX said today group executive for technology Jeff Olsson “has decided toleave” the company, with his departure date set for July.

"Unfortunately, you don't always makethe right decisions over the course of time, so you can get burdened with somebad decisions or technology that was good at the time but has now aged,"Mr Fowler said.

"That's not a reflection upon thecurrent CTO -- it's just a question of scale and age. I have some sympathy forthem."

http://www.smh.com.au/business/asx-technology-chief-steps-down-20120111-1puu6.html#ixzz1ji8Rc3TI

SIXSWISS EXCHANGE GLITCH DELAYS TRADING SIX Swiss Exchange has been forced todelay the start of trading by three hours because of a "technical problem".

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23315

HKExand CFFEX (China Financial Futures Exchange) sign MOU

http://www.hkex.com.hk/eng/newsconsul/hkexnews/2012/120111news.htm

MarketStatistics 2011

http://www.hkex.com.hk/eng/newsconsul/hkexnews/2012/documents/120119news.pdf

ISRAELIHACKERS TARGET ARAB STOCK EXCHANGE SITES AS CYBERWAR ESCALATES

Israelihackers have targeted the Web sites of stock exchanges in Saudi Arabia and AbuDhabi in retaliation for an attack earlier this week on the Tel Aviv bourse.

Moreon this story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23329

CABLE&WIRELESSAND EQUINIX TEAM ON CLOUD-BASED SERVICES

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42637

ERISEXCHANGE TO DISTRIBUTE MARKET DATA THROUGH CME

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42734

FOLLOWINGSCANDAL, PIPELINE TRADING SYSTEMS CHANGES NAME TO ARITAS SECURITIES http://www.finextra.com/news/announcement.aspx?pressreleaseid=42720

CLEARING

ISDASETS OUT GOALS FOR INDUSTRY CLEARING COMMITTEE

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42625

FSBESTABLISHES LEI AND CCP WORKING GROUPS The BIS-backed Financial Stability Boardhas set up a working group to deliver concrete recommendations on governanceissues relating to the management of new Legal Entity Identifiers (LEI) in theglobal securities markets.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23306

InteroperableMTFs primed for market share growth

http://www.thetradenews.com/news/Regions/Europe/Interoperable_MTFs_primed_for_market_share_growth.aspx

OTCclearing - margin methodologies

two articles thatmay be useful in understanding the technical aspects of clearing CDS and IRS.One-time registration required for access.
CDS clearing at ICE
http://www.futuresindustry-digital.com/futuresindustry/201111#pg33
IRS clearing at LCH.Clearnet
http://www.futuresindustry-digital.com/futuresindustry/201111#pg36

***Thanks to Will Acworth on LinkedIn

CLSAPPOINTS FOUR NEW BOARD MEMBERS

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42728

POLICY

NYSEEURONEXT LAUNCHES EU REGULATORY POLICY WEB SITE

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42622

Ithink this is the web site...that’s not mentioned in the press release???

http://corporate.nyx.com/fr/who-we-are/advocacy/eupolicy

REGULATORSDEMAND ACTION ON LEGAL ENTITY IDENTIFIERS

Internationalregulatory authorities have called for the urgent creation of a universal LegalEntity Identifier (LEI) in their final report on the OTC derivatives data thatshould be collected, stored and disseminated by trade repositories (TRs).

Moreon this story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23323

WorldBank Global Economic Prospects

Developingcountries should prepare for further downside risks, as Euro Area debt problemsand weakening growth in several big emerging economies are dimming globalgrowth prospects, says the World Bank in the newly-released Global EconomicProspects (GEP)

http://web.worldbank.org/WBSITE/EXTERNAL/EXTDEC/EXTDECPROSPECTS/EXTGBLPROSPECTS/0,,menuPK:615470~pagePK:64218926~piPK:64218953~theSitePK:612501,00.html

PARTICIPANTS

Royal Bank Of ScotlandReorganisation - Full Statement

Weare considering sale or closure options for our cash equities, corporatebroking, equity capital markets, and mergers and acquisitions businesses whichhad income of c£220 million in the nine months to September 2011 and arecurrently unprofitable. We are in discussions with a number of potential buyersthough there is no assurance of a sale concluding. We took this decisionbecause we want to prioritise our resources on those businesses where we arebest with customers and can operate most profitably for shareholders.

http://hereisthecity.com/2012/01/12/royal-bank-of-scotland-reorganisation-full-statement/

J.P. Morgan WSS posts $971 million revenue in Q4 2011
J.P. Morgan Worldwide Securities Services (WSS) net revenue was $971 million,an increase of 1 per cent compared with the year previous

http://www.assetservicingtimes.com/assetservicesnews/article.php?article_id=2881

BNY Mellon to snap up Penson's Australian ops
Penson Worldwide has announced the sale of its Australian subsidiary to BNYMellon for some $32 million

http://www.assetservicingtimes.com/assetservicesnews/article.php?article_id=2807

LIMEBROKERAGE BOASTS NANOSECOND LATENCY FOR PRE-TRADE RISK MANAGEMENT

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42739

Stuff

THIEVESDIG 100FT TUNNEL TO STEAL ATM CASH Thieves in Manchester spent six monthsdigging a 100-foot tunnel to reach a cash machine but made off with a paltry£6000 for their troubles.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23319

CITIINVESTS IN GIFT CARD EXCHANGE PLASTIC JUNGLE Banking giant Citi has used itsinvestment arm to take a strategic stake in Plastic Jungle, an online exchangefor gift cards. Terms of the deal were not disclosed.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23333

Weare always complaining that our days are few, and acting as though there wouldbe no end of them."

--Seneca, Roman philosopher, statesman and playwright

Eventhe most tedious chore will become endurable as you parade through each dayconvinced that every task, no matter how menial or boring, brings you closer tofulfilling your dreams."

--Og Mandino, American author

News: Demographics, Interoperability, Margining, G-SIFIs....and off to the shakey Isles.

2012-01-23T03:28:00.000-08:00

Demographicsand share prices

This chartshows the price earnings earnings ratio of shares and the ratio of middle agedto old aged people – old people sell shares, middle aged people buy them. Asthe number of old people rises, the valuation of shares fall – and that’s whatlies ahead of us.

http://www.businessspectator.com.au/bs.nsf/Article/markets-charts-US-budget-euro-debt-crisis-GDP-pd20111229-PYW48?OpenDocument&src=eiw&ir=4

HNY everyone!

Timeto dash to NZ and Ch. Ch.

We’re(father and son) off for a bike ride, the Otago rail trail.

http://www.otagorailtrail.co.nz/

Thissite shows 126 quakes in the past week.

http://www.christchurchquakemap.co.nz

Alot of people have gone for forecasts for 2012:

Whatwill the world be like in 2012?

http://blog.slideshare.net/2011/12/23/what-will-the-world-be-like-in-2012/

Ithink we’ll see further industry consolidation, but I also think we’ll see theindustry groaning and creaking with the winds of change. Primarily thoughregulatory reform with some less enduring reforms being those simply inspiredby political grandstanding or some flash in the pan shareholder activism (oncehealthy dividends resume, all sins of excess will be forgotten).

Ialso think we’ll see a sideways year for equities and commodities (caveatChina). Residential real estate will also trend sideways but there will beopportunities for those getting set in commercial real estate for the recovery.The great deleveraging will continue....and inflation is coming.

Ohh,and the Euro will be OK. There will be no break up and the ECB will issue someEuro bonds.

Thatsaid, I thought the Jean-Claude Trichet piece outlining his call for afederalised Europe was particularly poor. It reads more like a call to armsthan a reasoned basis for policy and financial integration.

I think the wind is out of the sails of the NYSE / DB deal.

EMCF publish new rules relating to interoperability.

Meanwhile in Aust we move closer to margining equities in2012.

I think the SEC has taken the side of inertia andindifference with the Lehman / Barclays position.

A link to the G-SIFIs and an interesting unintendedconsequence....the too big to fail brand means the tax payer guarantee isimplied anyway.

Marsal takes 500myn in fees to manage bankruptcy. Bleurrrgh.Tell that to the face of a creditor.

Have a happy, healthy and fun new year.

s.riley.mail@googlemail.com

http://clearingandsettlement.blogspot.com/

Trading

AMSTERDAM-(Dow Jones)- The Dutch government is threatening to block a possible sale ofthe derivative business in Amsterdam, The Dutch government is concerned that asale of the business could hurt the position of the Netherlands as a financialhub,

http://www.nasdaq.com/aspx/company-news-story.aspx?storyid=201112220825dowjonesdjonline000334&title=dutch-government-may-veto-boerse-nyse-merger-concession-source#ixzz1hu9UPyJ0

Deal Delay: DeutscheBoerse, NYSE Push Back Merger Deadline

In a regulatory filing, Deutsche Boerse andNYSE Euronext said they have decided to push back the deadline for completingtheir merger until March 31.

http://www.securitiestechnologymonitor.com/news/db-nyse-delay-merger-deadline-29793-1.html?ET=securitiesindustry:e3180:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=STM_BNA_08302010_122811

NYSE shareholders lose enthusiasmfor Deutsche Boerse deal
Prospects for the proposed merger of Deutsche Boerse and NYSEEuronext continue to dim as regulatory negotiations continue. Some NYSEEuronext shareholders are losing interest or becoming increasingly pessimisticthat the deal won't be approved. "The smoke signals are reasonably obviousat this point that this deal will not happen," said Brian Barish,president and chief investment officer of Cambiar Investors, the 10th-biggestshareholder of NYSE Euronext.

Chi-X Europe Moves to BATS Systems on April 30

BATS Global Markets has set April 30 as thedate when Chi-X Europe will begin operating live on BATS technology. Separateorder books though will be kept for Chi-X Europe and BATS Europe.

http://www.securitiestechnologymonitor.com/news/chi-x-europe-april-30-bats-29754-1.html?ET=securitiesindustry:e3153:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=SIN_DailyClose__121911

Direct Edge Adds a Pricing Tier, Lowers 2 Rebates

Direct Edge said it plans to start a new tierof pricing, while maintaining the top rate on a tier that rewards active marketparticipants. The operator of two national exchanges also plans to lowerrebates on two tiers.

http://www.securitiestechnologymonitor.com/news/direct-edge-new-pricing-january-2012-29792-1.html?ET=securitiesindustry:e3178:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=STM_BNA_08302010_122711

LSE might start trade-data servicefor OTC derivatives
The London Stock Exchange is considering expanding its trade-dataservice to include over-the-counter derivatives. "We are in very earlydiscussions with UK regulators about the possibility of using the UnaVista TRSas a registered trade repository for OTC derivatives," said Mark Husler,head of business development in the exchange's data division. Reuters (15 Dec.)

http://www.reuters.com/article/2011/12/15/lse-repository-idUSL6E7NF3AT20111215

Clearing

EMCFInteroperability Rule Changes

EMCFupdated Clearing Rulebook (interoperability)

http://www.emcf.com/upload/uploads/120104%20Clearing%20Rule%20Book%20ver%207%20final.pdf

EMCFInteroperability Fund

http://www.emcf.com/upload/uploads/20120104%20Regulation%20Interoperability%20Fund.pdf

LCH.ClearnetInteroperability FAQ

http://www.lchclearnet.com/Images/FaQs%20Interop%20for%20Equities%20May%2011_tcm6-57719.pdf

ASXEquities Margining: Q2, ’12 Margin reports, Q4, ’12 EoD margin calls, Q1, ’13Intraday margining.

DerivativesNotices:ATTACHMENT A TO CLM139/11: CASH MARKET MARGINING PROJECT - DECEMBER 2011 MARKETCOMMUNICATION

https://www.asxonline.com/intradoc-cgi/groups/derivatives/documents/communications/asx_032492.pdf

CHESSBulletins:BATCH SETTLEMENT - PARTIAL WAIVER OF ASX SETTLEMENT OPERATING RULE 10.4.5

https://www.asxonline.com/intradoc-cgi/groups/clearing_and_settlement/documents/communications/asx_032490.pdf

Policy

Jean-Claude Trichet, the former ECB President, has justpublished an op-ed outlining his call for a federalised Europe

Acentralized Europe is a globalized Europe

http://blogs.reuters.com/amplifications/2011/12/27/a-centralized-europe-is-a-globalized-europe/

NYSE Euronext sub-penny proposalproves controversial
NYSE Euronext has proposed allowing its members to quote insub-pennies. Some industry insiders want NYSE to slow the plan. SIFMA told theSecurities and Exchange Commission that it raised "significant marketstructure implications that require additional time to be considered."

Specifically, the NYSE will be providing selective access via aRLI, a flag that indicates that a better price exists on the exchange, whichwill be distributed through proprietary market data feeds and not through theConsolidated Quote Stream. Market participants that do not pay for thisproprietary data feed, which often may be smaller firms, will not have accessto this liquidity information. Also, even if market participants canaccess the proprietary data feeds, they will be unable to access the quoteunless they can

attest that the request is to fill an order for a retailcustomer. This requirement thus precludes institutional investors fromaccessing that quote. SIFMA believes that this Program therefore raisesselective access concerns and appears to run contrary to the mandate inRegulation NMS for open, non-discriminatory access to quotes.

Read the SIFMA comment letter.

http://www.sifma.org/issues/item.aspx?id=8589936678

SEC sides with Lehman in disputewith Barclays
Lehman Brothers Holdings won support from the Securities andExchange Commission in its asset dispute with Barclays. The agency said Lehmandoesn't have enough money to repay customers, and that Barclays has aconditional claim on money held in reserve. "The commission wishes toensure that assets held in the special reserve bank account for the exclusivebenefit of customers, as well as other assets required to be held for thebenefit of customers, are properly administered in the event a broker-dealer isliquidated," the SEC said.

http://www.bloomberg.com/news/2011-12-26/sec-backs-lehman-brokerage-in-3-billion-barclays-dispute-after-shortfall.html

FinancialStability Board: Policy Measures to Address Systemically Important FinancialInstitutions

G-SIFIslist

http://www.financialstabilityboard.org/publications/r_111104bb.pdf

...AndCapital surcharge requirements...

http://www.reuters.com/article/2011/11/04/g20-financials-idUSL6E7M430120111104

Commentary: G-SIFI designationmight be backfiring
Global regulators are implementing rules to battle the conceptthat some financial institutions have become too big to fail, but those rulesappear poised to backfire, CNBC.com Senior Editor John Carney writes. From"what I'm hearing from people at smaller Wall Street firms, [systemicallyimportant financial institution] is already becoming a code word for'ultra-safe counterparty' against whom minimal collateral requirements may becharged", Carney writes. CNBC/NetNet blog (21 Dec.)

http://www.cnbc.com/id/45752151

SIFMA seeks to broaden discussionof high-frequency trading
SIFMA today will release a white paper that calls for morediscussion about high-frequency trading and how it affects the broader marketstructure and other investing. The paper also notes that high-frequency tradinghas yet to be accurately defined. "It's a characterization that'sundefined," said Randy Snook, executive vice president at SIFMA. "Wethink there are a range of computer-based trading strategies and our objectivewith this paper is to focus on behaviors that are disruptive, and notnecessarily focus on the speed of trading." SIFMA SmartBrief readers canget their first look at SIFMA's statement and white paper.

http://www.sifma.org/issues/item.aspx?id=8589936694

Participants

Lehman Pays Marsal Firm Almost $500 Million to Manage Bankruptcy
BusinessWeek
Lehman Brothers Holdings Inc. has paid almost half a billion dollars in fees torestructuring firm Alvarez & Marsal LLC during its bankruptcy, according toa court filing.

Lehman,which has spent more than $1.5 billion on fees since filing the biggest bankruptcyin U.S. history in September 2008

Marsal,who bills Lehman hourly, has said he will start distributing some cash to thedefunct firm’s creditors by next year, more than three years after thebankruptcy filing. He has court approval for a $65 billion liquidation planthat would pay the average Lehman creditor less than 18 cents on the dollar inthe next few years, according to court papers
http://www.businessweek.com/news/2011-12-27/lehman-pays-marsal-firm-almost-500-million-to-manage-bankruptcy.html

JPMorgan leads ranking of globalinvestment banks
JPMorgan Chase collected 8.1% of the $68 billion in total revenueof investment banks around the world this year, according to Dealogic. Bank ofAmerica Merrill Lynch's share was 7.4% and Goldman Sachs Group had 5.8%. Meanwhile,Freeman & Co., a New York-based research firm, said that as of Dec. 19, theglobal, year-to-date investment banking fee pool was $78.6 billion. Bloomberg (12/20)

http://www.bloomberg.com/news/2011-12-20/investment-banks-fees-slump-to-lehman-era-lows-for-2011-amid-euro-crisis.html

Themysterious millionaires factory

Macquarieis a global financial services company with over 15,000 employers, just overhalf of whom are based outside Australia. It acts primarily as an intermediaryfor institutional, corporate and retail clients around the world, with aparticularly strong presence in the Asia-Pacific region. Macquarieservices include (but are not limited to)

http://www.macrobusiness.com.au/2011/12/the-mysterious-millionaires-factory/?utm_source=Media+List&utm_campaign=66ebd5a351-RSS_DAILY_MAILCHIMP_CAMPAIGN&utm_medium=email

Stuff

HowAustralia (or Western Australia at least) digs itself out of a GFC.

http://www.macrobusiness.com.au/2011/12/mapping-was-mining-boom/?utm_source=Media+List&utm_campaign=66ebd5a351-RSS_DAILY_MAILCHIMP_CAMPAIGN&utm_medium=email

Create& Collaborate

http://us1.campaign-archive2.com/?u=028de8672d5f9a229f15e9edf&id=00b9f19f14&e=6ac94dc2f4

"Ifyou're unhappy, nine times out of ten it's because you're clinging ontosomething.
Nine times out of ten, happiness and letting go are synonymous."

Betterkeep yourself clean and bright; you are the window through which you must seethe world."

--GeorgeBernard Shaw, Irish playwright

Whateveryou can do or dream you can, begin it.
Boldness has genius, power and magic in it!”

JohannWolfgang von Goethe

“Themoment one definitely commits oneself, then Providence moves, too.”
― W.H. Murray in The Scottish Himalaya Expedition, 1951

Actboldly and unseen forces will come to your aid."

--Dorothea Brande, American writer and editor

Itis a fair, even-handed, noble adjustment of things, that while there isinfection in disease and sorrow, there is nothing in the world so irresistiblycontagious as laughter and good-humour."

--Charles Dickens, British author

Ithink making mistakes and discovering them for yourself is of great value, butto have someone else to point out your mistakes is a shortcut of theprocess."

--Shelby Foote, American historian and novelist

Abilitywill never catch up with the demand for it."

--Confucius, Chinese philosopher

2011-12-29T03:38:00.000-08:00

Merry Xmas All!

Christmas is the time when kids tell Santa what they want andadults pay for it.
Budget deficits are when adults tell government what they want and their kidspay for it.

I believe anything can be used as collateral, subject toaccurate pricing...but in the middle of a GFC something about putting loans andcollateral together just makes me wonder.

Interesting blog from IMF (I didn’t think they’d blog). Yes,perception often does become its own self fulfilling reality.

Retail bond market is a missing dimension to the Aussiecapital markets (and the UK too!)

Penson continues its ‘strategic repositioning’. Back in2006, Penson was one of the entities asked to provide pricing for a competingCCP for Chi-X Europe. Of course EMCF won the RFP and the rest is history.

I thought I forgot things when I walked around the housebecause I’m becoming old. Then good old scientific American tells me not toworry, its just my mind using the doorways as a memory purge....I think Ibetter move to an open plan office and go and live in a field.

No ocean swims organised for the coming days but I sure planto catch a few waves.

It’s been a whirlwind of a year.

Thank you for those of you that have been patient andunderstanding readers!

Have a very Merry Christmas and a Happy andHealthy New Year.

Let love warm your life, light brighten your mind and peaceguide your way.

All the very best and enjoy!

s.riley.mail@googlemail.com

http://clearingandsettlement.blogspot.com/

Platforms

US sets terms for Deutsche-NYSE merger

The Justice Departmentissued a consent decree that allows the merger to proceed but with DeutscheBoerse required to divest itself of an interest it holds in a rival U.S. stockexchange, Direct Edge.

That stake is heldby the International Securities Exchange, an options exchange operator based inNew York. ISE in turn is wholly owned by Eurex, the derivatives exchange ofDeutsche Boerse.

ISE has held its31.54% minority stake in Direct Edge since 2008. ISE will have two years fromthe closing of the merger to complete the sale.

http://www.securitiestechnologymonitor.com/news/db-nyse-clear-antitrust-hurdle-29784-1.html?ET=securitiesindustry:e3165:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=STM_BNA_08302010_122211

BATS Proposes Rewards Program for Market Makers

Theexchange operator said through the BATS CLP program, liquidity providers wouldcompete for a daily reward by posting competitive quotes in a stock orexchange-traded product. The liquidity providers, who must be a registeredmarket maker on BATS and be classified as a CLP for a listing - will berewarded based on their continuous daily quote size at the National BestBid/Offer, BATS said

http://www.advancedtrading.com/exchanges/232300853?cid=nl_at_daily&elq=cd1daf6fcfb1427683914311eae3fdd3

HKEx Publishes Market Statistics 2011 in Response toMedia Requests http://www.hkex.com.hk/eng/newsconsul/hkexnews/2011/1112202news.htm

17page breakdown here:

http://www.hkex.com.hk/eng/newsconsul/hkexnews/2011/Documents/20111220news.pdf

TMXGROUP BUYS 16% STAKE IN BERMUDA STOCK EXCHANGE

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42499

Robert Elstone to join Westpac board

http://news.smh.com.au/breaking-news-business/robert-elstone-to-join-westpac-board-20111221-1p4tm.html

Intersuisse to buy Austock brokerage

Lastyear the broker hired the former head of Bank of America-Merrill Lynch inAustralia, Paul Masi, as its chief executive
For Intersuisse, which specialises in resource and energy stocks, theacquisition will give it broader distribution for its Singapore-based backer,Phillip Brokerage
Phillip, which has operations in 12 countries mostly in Asia, has a 46 per centstake in Intersuisse.
http://www.smh.com.au/business/intersuisse-to-buy-austock-brokerage-20111219-1p2f2.html#ixzz1hKNwrZBJ

Clearing

Markit and Euroclear sign memorandum of understanding

Markit and Euroclear Bank have signed a memorandumof understanding to jointly create an operational infrastructure to support theuse of loans as collateral in financing transactions.

http://www.securitieslendingtimes.com/securitieslendingnews/article.php?article_id=217910

Policy

BoE and FSA warn about drawbacks of risk-preventiontools
The Bank of England and the UK Financial Services Authority releaseda paper that highlights challenges faced by regulators as they strive toprevent a repeat of the 2008 financial crisis. The paper explains drawbacks oftools that the central bank might use to keep excessive risk from building upin the financial system.

http://www.bloomberg.com/news/2011-12-20/boe-s-king-says-policymakers-needs-proper-powers-to-tackle-systemic-risk.html

Instruments of macroprudential policy

http://www.bankofengland.co.uk/publications/other/financialstability/discussionpaper111220.pdf

***42 pages of macroprudential policy reading here. (not yet available on eReaders/ Kindle for holidays).

2011 In Review: Four Hard Truths

First, post the 2008-09 crisis, the world economy is pregnant with multipleequilibria—self-fulfilling outcomes of pessimism or optimism, with majormacroeconomic implications.

Second, incomplete or partial policy measures can make things worse.

Third, financial investors are schizophrenic about fiscalconsolidation and growth.

Fourth, perception molds reality.

http://blog-imfdirect.imf.org/

EQUITYCAPITAL MARKETS UPDATE | Treasurer releases discussion paper on developing aretail corporate bond market

http://www.blakedawson.com/Templates/Publications/x_publication_content_page.aspx?id=64669

***Nice wrap up of the consultation document.

DiscussionPaper - Development of the Retail Corporate Bond Market

http://www.treasury.gov.au/contentitem.asp?NavId=&ContentID=2266

Participants

Merrill Lynch to Produce Thunder for Asian Trading

Bank of America Merrill Lynch said it will marketa broker-neutral trading platform named Thunder, to institutional customers inAsia.

The platform is based on in-houseelectronic tools, as well as trading technology from Tora Holdings, a supplierof high-speed trading systems based in Tokyo and Hong Kong.

Merrill Lynch’s Thunder platform will usemulti-broker, multi-market, multi-asset electronic trading technology fromTora.

http://www.securitiestechnologymonitor.com/news/merrill-lynch-asian-trading-platform-thunder-29705-1.html?ET=securitiesindustry:e3145:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=STM_BNA_08302010_121611

UBS bonus deal

A unique dealto protect part of the annual bonus pool at UBS Australia expires within weeks
Under the terms of that deal, UBS agreed to let the Australia unit allocate acertain percentage of its revenue stream toward year-end pay, the sources say.Annual country revenues and bonus pools are normally kept separate at banks.
http://www.smh.com.au/business/ubs-bonus-deal-opens-pool-to-predators-20111219-1p19r.html#ixzz1gyA7EzUp

PENSONBRINGS IN ADVISERS ON SALE OF CANADIAN UNIT

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42495

Penson to close UK arm
Penson Worldwide has announced plans to close its UK operation over the nextfew months, and to sell certain of the operation’s assets to third parties.

http://www.securitieslendingtimes.com/securitieslendingnews/article.php?article_id=217911

BLOOMBERG: London Brokers Shrink as Debt Crisis Bites

Inthe past month, Altium Capital closed its securities unit. Evolution Group Plc(EVG), Merchant Securities Group Plc, Arbuthnot Securities Ltd. and CollinsStewart Hawkpoint Plc have all accepted takeover offers from largercompetitors.

http://www.bloomberg.com/news/2011-12-22/london-brokers-throw-in-the-towel-as-debt-crisis-hits-revenue.html

Stuff

Europe's PerishingParishes

in the Netherlands,Christianity's retreat from society has been particularly drastic. TheProtestant Church alone loses some 60,000 members each year. At this rate, itwill cease to exist there by 2050, church officials say.

St. Joseph's church opened a skate park, with ramps and obstaclesin the nave, charging €3.50 to spend a day skating between holy figures. Sincethen church attendance has been respectable.

http://www.spiegel.de/international/zeitgeist/0,1518,805075,00.html#ref=nlint

Why Walkingthrough a Doorway Makes You Forget
Scientists measure the "doorway effect," and it supports a novelmodel of human memory

http://www.scientificamerican.com/article.cfm?id=why-walking-through-doorway-makes-you-forget

Christmas is the time when kids tell Santa what they want andadults pay for it.
Budget deficits are when adults tell government what they want and their kidspay for it.

http://www.brainyquote.com/quotes/keywords/deficits.html

2011-12-22T15:13:00.000-08:00

Ahh,as ever time flies.

Well,after the chill of Bondi to Bronte lets home the Manly swim is a bit warmer.

Nicewrite up here:

http://www.oceanswims.com/Events/EventDetails.asp?EventID=304&EventScheduleID=&EventRegistrationID=21850

LSEacquiring the FT (Pearson) stake is not such a great deal 8in my view. FTalways provided an angle the LSE couldn’t.

ASXis on the pay before they vest executive comp. bandwagon.

EMCFrecognised as the incumbent. Lovely! No doubt the same applies to Chi-X Europe?

Notsure about the FIA Principal Traders Response.

Politicalchanges in Aus, but nothing changes until the next election.

RICsand ISINs should be free or at cost recovery at most.

Kindasad to see DB sell / lose the Asset Management limb of their business.

Getcoand Virtu both see value in increasing their NYSE floor presence.

Aussiealchemists get to play and try and turn our grey matter to gold. (frankly, Ithink digging holes in the back yard is easier).

Andan odd, but related story. Aussie real estate is a proxy for what ishappening globally. Inter-Asian cash flows are rising to compensate for thestagnating G20 countries.

Noteto self, for statements of the obvious, try University of New Orleans and SUNYOld Westbury. CFOs flee the sinking ship prior to bankruptcy. Fancy that!

Havea great w/end all,

Platforms

BATSCHI-X EUROPE EXECUTIVE COMMITTEE MEMBERS NAMED

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42407

CME President Awaits theGreenlight for the Reopening of China’s Financial Derivatives Market

CME Group began offering yuan exchange futureson Oct 17 in order to satisfy the increasing needs of settlements of thecurrency in global markets. Chinese analysts said this might facilitate theinternationalization of China’s currency.

The company also plans to launch a clearinghouse in Asia and increase the number of employees in the region.

“The best is yet to be” is Gill’s mottothat he learned at school – the Anglo-Chinese School in Singapore. “It holdstrue for most things we do through life,” he said.

http://www.asiaetrading.com/cme-president-awaits-the-greenlight-for-the-reopening-of-chinas-financial-derivatives-market/

LSETO BUY PEARSON'S FTSE STAKE

TheLondon Stock Exchange (LSE) has agreed a £450 million cash deal to buy the 50%stake in FTSE International it does not already own from publisher Pearson.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23244

DEUTSCHEBÖRSE AND NYSE EURONEXT OFFER MORE CONCESSIONS TO REGULATORS Deutsche Börse andNyse Euronext have offered the European Commission more concessions in a bid toallay antitrust concerns and secure approval for their $9 billion merger deal.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23251

Hidden pay condemned

THE powerful peak body for industry superannuation, theAustralian Council of Super Investors, has condemned the payment of hiddendividends on unvested shares, calling for management to ''pay back the money''in cases where performance pay has not been earned.

Several leading Australian companies are hiding paymentsto their senior management teams by paying dividends on performance shares,meaning executives are getting a return on performance stock to which they maynever be entitled.

The ASX Corporate Governance Council is yet to deliberateon the practice of paying dividends from stock which has not vested. The newchairman of the council, Alan Cameron, was unavailable for comment yesterday.

The ASX corporation buys stock on market from which itpays dividends to its management, before the stock vests. The payments aremodest and disclosed in the remuneration section in the annual report.

Last financial year, each participating employee receivedan average $2300 in franked dividends and former CEO Robert Elstone about$46,000.

http://www.smh.com.au/business/hidden-pay-condemned-20111212-1orev.html#ixzz1gZhs1W00

XCHANGINGRENEWS LME CONTRACT

Thecontract, which renews on 1 January 2012, is for a minimum of three years, witha two year notice period after the first year. The contract is expected togenerate revenues of c. £75 million over its first three years.

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42351

SIXARRESTED IN MILLION POUND PHISHING SCAM UK police have arrested six people inconnection with a phishing scam that plundered over £1 million from student bankaccounts.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23240

***I immediately assumed this was the Swiss exchange....

Securities lending on India's NSE booms
Stock lending has been booming in the last threemonths due to reverse arbitrage opportunities thrown up by equities

http://www.securitieslendingtimes.com/securitieslendingnews/article.php?article_id=217898

Volatility in China: Hong Kong, Shanghai Capitalizeon Indices

Hong Kong Exchanges and Clearing Limitedsaid Thursday it plans to start trading futures based on a volatility index inFebruary.
That follows the Wednesday announcement by the Shanghai Stock Exchange that itplanned to launch a series of indices based on market volatility, in January.

http://www.securitiestechnologymonitor.com/news/hong-kong-shanghai-volatility-indices-29740-1.html?ET=securitiesindustry:e3138:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=STM_BNA_08302010_121511

Clearing

DTCCFILES WITH SEC TO OPERATE CCP FOR MORTGAGE BACKED SECURITIES

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42384

BURGUNDYCHOOSES EUROCCP FOR INTEROPERABLE CLEARING

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42362

EUROCLEARPREPS MANAGEMENT CHANGES

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42377

Shaking Things Up, In European Clearing

Ilove this:

Andovercome the reluctance of incumbents such as LCH.Clearnet, EMCF and SIXx-Clear to upset the existing order and allow “interoperability” betweensystems.

EMCFas incumbent?

Brilliant.

http://www.securitiestechnologymonitor.com/news/diana-chan-euroccp-profile-29714-1.html?pg=3

LSE eyes OTC trade repository

TheLondon Stock Exchange has started talks with British regulator the FinancialServices Authority (FSA) about launching a trading data service forover-the-counter (OTC) derivatives.

TheLSE already offers a trade data repository called UnaVista TRS, for sharetransactions, but is eyeing expansion into OTC products ahead of regulatoryreforms to that market.

http://www.reuters.com/article/2011/12/15/lse-repository-idUSL6E7NF3AT20111215

Policy

FIA PrincipalTraders Group

The FIA Principal Traders Group has issuedthe following letter to CFTC Commissioner Scott O'Malia in response to hisrequest for public comment on a proposed definition of High Frequency Trading:

http://www.automatedtrader.net/headlines/99556/fia-response-to-cftc-proposed-definition-of-high-frequency--trading

***Answering a question with a question provokes thought, but I don’t think itaddresses misconception and misdirected political opinion.

Developingthe Retail Corporate Bond Market - 13/12/2011

http://ministers.treasury.gov.au/DisplayDocs.aspx?doc=pressreleases/2011/155.htm&pageID=003&min=wms&Year=&DocType=

Discussionpaper: Development of the retail corporate bond market: streamlining disclosureand liability requirements

http://www.treasury.gov.au/documents/2266/PDF/Retail_Corporate%20Bonds_Discussion_paper.pdf

***27 page discussion paper available here.

Industry welcomes Shorten's promotion

Thenew Industrial Relations and Financial Services Minister Bill Shorten said he'sdelighted with his new promotion to Cabinet

http://www.financialstandard.com.au/news/view/12548405/

The 2011 RBA Conference Volume, The Australian Economy inthe 2000s, has been released today on the Bank’s website.

http://www.rba.gov.au/publications/confs/2011/index.html

THOMSONREUTERS LOOKS TO SETTLE EC DATA ANTITRUST CASE Thomson Reuters has offeredconcessions in the way it licenses the proprietary Reuters Instrument Codes(RICs) in a bid to settle an EU antitrust investigation.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23256

***RICs and ISINs should be free, or cost recovery at most.

Insolvency rogues face crackdown

Governmentannounces new laws to protect creditors from misconduct by liquidators.

http://www.smh.com.au/business/insolvency-rogues-face-crackdown-20111214-1ouvn.html

Participants

BNYMellon to snap up Penson's Australian ops

Penson Worldwidehas announced its intention to sell Australian subsidiary, PFSA, to BNY Mellonfor some $32 million

The agreement is for a sharepurchase transaction from which Penson expects to realise a gain of about $14million when the deal closes in the fourth quarter this year

http://www.assetservicingtimes.com/assetservicesnews/article.php?article_id=2807

Deutsche Bank tosell asset management arm

Deutsche Bank has announcedplans to offload its asset management arm, after completing a strategic reviewof the company, according to the Financial Times.

According to the report, theunit will be priced at €2 billion ($A2.6 billion), with initial bids due laterin the year.

http://www.businessspectator.com.au/bs.nsf/Article/Deutsche-Bank-to-sell-asset-management-arm-pd20111216-PL5DD?OpenDocument&src=pmm

Mitsubishi UFJ to take 15%stake in AMP Capital

Mitsubishi UFJ Financial Group will pay $425 million for a 15percent stake in AMP Capital that will enable Japan’s biggest publicly tradedbank to take a stake in the world's fourth-largest pension market

In September2008 Mitsubishi UFJ provided a US$9 billion lifeline to Morgan Stanley when theNew York-based investment bank’s stock price was floundering amid concerns overits business viability. Mitsubishi UFJ had a 22.4 percent stake in MorganStanley as of July 1.

http://www.iandtnews.com.au/news/mitsubishi-ufj-pays-425-mln-for-15-stake-in-amp-capital

VIRTUFINANCIAL BUYS NYSE AMEX DESIGNATED MARKET MAKER

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42379

Getco Grabs BofA Merrill's DMM Unit.

www.tradersmagazine.com/news/getco-merrill-dmm-109628-1.html

BANKOF AMERICA MERRILL LYNCH AND TORA TEAM ON TRADING PLATFORM FOR BUY SIDE

5%of all trading volume on the Tokyo Stock Exchange is processed throughTORA.

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42358

INSTINETBLOCKMATCH RECEIVES OK TO REFERENCE EUROPEAN CONSOLIDATED PRICE

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42408

Stuff

040- 'Turning Grey Into Gold', Address to the Older Workers and WorkabilityConference - 12/12/2011 http://ministers.treasury.gov.au/DisplayDocs.aspx?doc=speeches/2011/040.htm&pageID=005&min=wms&Year=&DocType=

***So, Australia is trying to turn Old...into Gold. I guess a bit of alchemy isone way to reduce the pension burden. Hope it doesn’t hurt.

154- Final Report on the Economic Potential of Senior Australians - 12/12/2011

Realisingthe economic potential of senior Australians: turning grey into gold

http://www.treasury.gov.au/EPSA/content/publications/grey_gold/default.asp

Allexplained in 66 pages.

Impacted by MF Global,Patsystems Receives Takeover Offer

IONTrading is Patsystem’s single largest shareholder, and has been holding 29percent of the shares for the past two or three years, according to a spokesmanfor the vendor. ION has valued each share in Patsystems at 14 pence or 20 centsper share. Based on its current market cap of 29 million pounds, ION is valuingthe software firm at $45 million.

ION— which earlier this year acquired Wall Street Systems — now has until Dec.26th to either announce a firm intention to make an offer or not.

http://www.advancedtrading.com/regulations/232200249?cid=nl_at_daily

Ray White posts bestresults in eight months and says Gold Coast office surprise star

Amongthe highlights of the year was a successful Asian marketing tour, during whichmore than 20 residential sales were made to Indonesian purchasers in the newTop Ryde City project north of Sydney.

“Infact, all of Asia seems to be selling to all the rest of Asia. For the firsttime in memory, Japanese developers are marketing Tokyo housing projectsdirectly to Australian citizens through the Australian press,” White says.

“Thegiant Dubai developer Majid is set to market their massive Al Futtaim projectin Beirut to the Lebanese community in Australia.

http://www.propertyobserver.com.au/industry-news/ray-white-posts-best-results-in-eight-months-and-says-gold-coast-office-surprise-star/2011121552865?utm_source=Property+Observer+List&utm_campaign=167b100cec-December_16_20117_4_2011&utm_medium=email

Study: CFO resignations could signal corporatebankruptcy
A chief financial officer's resignation couldbe a sign that a company is in danger of going bankrupt, according to a studyby researchers at the University of New Orleans and SUNY Old Westbury. Ananalysis found that corporate bankruptcies occurred more frequently followingthe departure of a finance chief. A CFO's access to financial information couldinfluence the decision to quit a failing company, the researchers say.

http://www.cio.com/article/696242/When_the_CFO_Quits_Will_Bankruptcy_Follow_

WarrenBuffett once said that if you were not prepared to own the whole business for10 years, you should not own a piece of it for 10 minutes.

"Hewho takes offense when none is intended is a fool. He who takes offense whenoffense is intended is a bigger fool."
-- Attributed to Confucius

You'llnever plow a field by turning it over in your mind."

--Irish proverb

CXA mkt share, CXA TAS Oops, CXG, UBS, X-Clear yodels, EMCF OTC, Turquoise read all about it....and a southerly blows over Bondi to Bronti.

2011-12-18T15:40:00.000-08:00

Bondi– Bronte was an excellent swim.

Toughestconditions (so they say) in the running of the event.

Althoughthe day started sunny, an unfavourable southerly wind soon changed the face ofthe race.

Morethan 10% of the field either did not show or did not start.

Ofthose that started, about 1% got fished back out again.

Waterwas supposed to be 18C. As for me, my toes were numb by about the first turningbuoy (can).

(Numbnessis always an interesting sensation early in the race. Does get one wondering. )

Onegood thing I notice about swimming in bitterly cold water is clear water andgreat visibility.

Inprevious years, I’ve done this swim in about 35mins.

Thisyear I did 52:18 (average for age was 57:22). Same course, same distance, just17mins slower, gives you an idea of the conditions.

Iknew at the end of the race I’d been for a swim....(not least because of thepeople with hypothermia and the space blankets all around).

Gottarespect that ocean.

In2011, posn 519/1360, 53/127, 52:18 (avg 57.22)

In2009, posn 839/1988, 120/215, 35:52 (Average time 37.13)

In2008, posn 595/1702, 50/153, 35.21 (Average time 38:09)

Resultshere:

http://www.multisportaustralia.com.au/RaceTecResults/Default.aspx?CId=1&RId=613&EId=1

Onereport here:

http://oceanfit.com.au/event/bondi-to-bronte/

Eventreport and pictures here:

http://www.bonditobronte.com.au/bondi-to-bronte-ocean-swim.html

Printyour own certificate here:

http://www.bonditobronte.com.au/ocean-swim-results.html

...socongratulations to you!

CXA/ ASX market share:

Acouple of people picked up on this.

Thereis a useful page / source on the ASX web site:

http://www.asx.com.au/trading_services/market-share-detail.htm

Turquoiseon the book shelves!

ASXhiccup with CXA TAS (Trade Acceptance Service)

UBSinvests in CXG.

HKupgrades.

LMEupgrades and Cinnober in the news.

EMCFstarts OTC clearing. I really like this. The scope of product that is eligiblefor clearing has only just started to be explored.

SIXyodels on interoperability...yet remains silent on their vested interest withUBS (17.3% ownership).

Francecalls on HFT regulation demoralizing.

Listof GSIFI’s

Aussiereal estate often gets cited as being expensive and hosting its own bubble.

CertainlyAussie real estate is relatively expensive...but that is because it isunderpinned by a unique set of local tax arrangements.

...Infact, we even get our own negative gearing Wiki page.

Thisweekend...I was off to Billie....but now going off to Brissy to see mum!

Havea good weekend all,

s.riley.mail@googlemail.com

http://clearingandsettlement.blogspot.com

Whythe euro will be OK.

Merkozy's eurobond in disguise

Itmay seem absurd, but the pact between Germany and France has suddenly madeItalian bonds attractive. And while everything hinges on the crisis summit,eurobonds may no longer be necessary.

http://www.businessspectator.com.au/bs.nsf/Article/Eurozone-Italy-Angela-Merkel-Nicolas-Sarkozy-Goldm-pd20111207-PB5KX?OpenDocument&src=pmm

Anda nice...little round up of events in Asia in 2012 –

"FacingForward & Focusing on the Future - Top 10 Newsworthy Market Events of 2011in Asia"

SGX-ASX

ExchangeTechnology Up-grades

Chi-XAustralia

HongKong Mercantile Exchange

TSE/OSEMerger Announcement

Chinanow has FIX Routes

ASEANLink

CorporateGovernance

HKExand China JV

BRICS– A Move Towards Global Cooperation

http://balmoraladvisory.wordpress.com/

Platforms

ExTurquoise CEO, Eli Lederman, self publishes his first novel!

Ledermandenounces what he sees as a culture of greed in which shareholder interestsrank far below individual ambition.

Ledermantook the LSE to an employment tribunal last year.

“Eversmaller order sizes transacting at ever higher frequencies – that’s just anillusory boon to banks and does nothing for the end-investors for whom marketsreally should be designed.”

http://thetradenews.com/node/7137

BATSEUROPE HIT BY TRADING BREAKDOWN

BatsEurope has suffered a trading breakdown just days after finalising a deal toacquire rival platform Chi-X Europe.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23232

ASX glitch hits Chi-X settlement
TheASX's trade acceptance service stopped clearing and settling trades by rivalexchange Chi-X from about 10am to 12pm yesterday, preventing orders from beingcompleted.
http://www.smh.com.au/business/asx-glitch-hits-chix-settlement-20111206-1oh4j.html#ixzz1fqGs36Zi

UBSTAKES STAKE IN CHI-X GLOBAL

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42279

EU regulators seekmore concessions from Deutsche Boerse and NYSE

EU regulators told NYSE Euronext and Deutsche Boerse that they need to offermore concessions to overcome antitrust concerns about their proposed merger.Authorities said the exchanges' offer last month didn't sway rivals andcustomers. Bloomberg (06 Dec.),

http://www.bloomberg.com/news/2011-12-06/deutsche-boerse-nyse-concession-offer-said-short-of-european-union-demands.html

AMS/3.8 Will beImplemented for Start of Trading Tomorrow

Hong KongExchanges and Clearing Limited (HKEx) is pleased to announce that the PostRelease Test for AMS/3.8, an update to the securities market trading system,has been completed successfully, paving the way for the system to be rolled outin advance of the start of trading tomorrow (Monday) morning.

The upgradewill increase the securities market’s efficiency and transparency and pave theway for future growth. It will increase the trading system’s processingcapacity over the current capacity by about 10-fold to 30,000 orders persecond, scalable to 150,000 orders per second, and reduce latency to 2 millisecondson an average trading day, about 70 times faster than present and better thanthe project target of 9 milliseconds at 30,000 orders per second.

http://www.hkex.com.hk/eng/newsconsul/hkexnews/2011/111204news.htm

Chi-XJapan November 2011 Trading Statistics

http://www.chi-x.com/resources/jp/file/monthly/Chi-X%20Japan%20Monthly_November%202011.pdf

BroadridgeConnects to Chi-X in Australia

Broadridge Financial Solutions, Inc.announced November 29 that, beginning October 31, 2011, users of its SUMMITstockbroking and accounting solution for the Australian equities market areable to take full advantage of Broadridge’s new broker trading connectivitytool to process trades executed on the recently launched Chi-X alternativeexchange in Australia.

http://www.asiaetrading.com/broadridge-connects-to-chi-x-in-australia-through-new-multi-market-broker-trading-connectivity-solution/

LMEUPGRADES ELECTRONIC TRADING PLATFORM

Thepartnership between Cinnober and the LME began back in 2003, when the Swedishsupplier delivered its first version of the LMESelect platform, based on itsproprietary TRADExpress technology. During this long partnership, electronictrading has grown from 2% to over 70% of the LME's market volume.

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42285

CINNOBERRELEASES HOSTED OTF PACKAGE

Swedishtechnology supplier Cinnober has released a subscription-based hosted servicefor banks and brokerages looking to create an Organised Trading Facility inline with new European marketplace regulations.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23237

Clearing

EMCFLIVE WITH CCP SERVICES FOR OTC TRANSACTIONS

EMCFwill offer clearing and settlement services in Over The Counter Transactions(OTC) in ING issued Sprinters and Citi's issued Speeders (both structuredproducts) traded on cats (Citi's Automated Trading Services)

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42255

SWISSCLEARER TARGETS ASIA AS EUROPEAN INTEROPERABILITY DEALS BOOST VOLUMES SIXSecurities Services is to push for clearing interoperability in Asia afterdoubling its market share of clearing London Stock Exchange trades followingthe introduction of similar measures in Europe.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23238

Table10, page 31 of SIX annual report.

UBSown 17.3% of SIX. (CS own 12.8%).

http://www.six-group.com/download/publications/annual_reports/2010/six_group_financial_report_2010.pdf

Market participants unconvinced by OTC reform

OTC clearing reform will not reducesystemic risk, according to 50% of market participants surveyed at a recentindustry debate. Nevertheless, 79% have identified the need for collateraloptimisation within their organisations, driven by regulatory changes on thehorizon.

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42277

Policy

Statement by Glenn Stevens, Governor: Monetary PolicyDecision

Atits meeting today, the Board decided to lower the cash rate to4.25 per cent, effective 7 December 2011.

Thereduction in the cash rate as a result of the Board's previous decision flowedthrough to lending rates, which are now around their average level of the past15 years.

http://www.rba.gov.au/media-releases/2011/mr-11-28.html

France calls for tougher ruleson high-frequency trading
Jean-Pierre Jouyet, chairman of France's market regulator, said regulatoryproposals covering high-speed trading need to be stronger. "The mechanismenvisaged by the [European] Commission must be expanded by giving the EuropeanSecurities and Markets Authority broader powers to regulate high-frequencytrading more effectively; for example, as regards platforms' pricing or ticksizes," Jouyet said. Reuters (05 Dec.)

http://uk.reuters.com/article/2011/12/05/eu-mifid-idUKL5E7N53R220111205

U.S.working with other countries on swaps rules

Theyhave complained that under the proposal, foreign subsidiaries of U.S. companiesthat do business with foreign institutions would be forced to back derivativetrades with collateral while non-U.S. banks would not.

http://uk.reuters.com/article/2011/12/05/financial-regualtion-gruenberg-idUKN1E7B41HP20111205

Mr Glenn Stevens’ speech,to the Inaugural Warren Hogan Memorial Lecture at theUniversity of Sydney in Sydney,

The Incredible Eurodollar.

Large centres of high saving withportfolios that are overweight in foreign assets whose return is low and whosevalue is highly likely to go down, measured in the currencies of the holders,amounts to something of a problem. Attempts by those holders to exit thisposition quickly would be, to say the least, highly disruptive. They know thatand that is why they do not attempt it, though there is a degree of diversificationunder way. To paraphrase the old line, if I owe you a few billion, I may have aproblem. If I owe you a trillion or two, you may have a problem every bit asbig as mine.

So there is a very long-term issue ofportfolio re-balancing to be addressed here as well as one of structuralrealignment of national price levels (i.e. real exchange rates). At the sametime though, there are increasing calls for the emerging economies with largesurpluses and high reserve holdings to play a part in assisting Westerneconomies facing budgetary and banking sector problems. With the balance sheetsof many Western sovereigns already under pressure, there is hope forcontributions from large reserve holders – they, after all, are the ones withthe cash.

http://www.rba.gov.au/speeches/index.html

PolicyMeasures to Address Systemically Important Financial Institutions

http://www.financialstabilityboard.org/publications/r_111104bb.pdf

GloballySystemically Important Financial Institutions:

(Therewill, in due course, be a framework for globally systemic insurance companieswith parallel criteria.)

Bankof America

Bankof China

Bankof New York Mellon

BanquePopulaire CdE

Barclays

BNPParibas

Citigroup

Commerzbank

CreditSuisse

DeutscheBank

Dexia

GoldmanSachs

GroupCrédit Agricole

HSBC

INGBank

JPMorgan Chase

LloydsBanking Group

MitsubishiUFJ FG

MizuhoFG

MorganStanley

Nordea

RoyalBank of Scotland

Santander

SociétéGénérale

StateStreet

SumitomoMitsui FG

UBS

UnicreditGroup

WellsFargo

Participants

DEUTSCHEBANK RESTRUCTURES TRANSACTION BANKING UNIT

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42324

Mitsubishi UFJ takes 15% stakein AMP Capital

Mitsubishi UFJ Financial Group, Japan’s biggest publicly traded bank, has paid$425 million for a 15 percent stake in AMP Capital as part of an agreementwhereby the two companies will distribute each other’s products in theirrespective countries.

http://www.iandtnews.com.au/deal/mitsubishi-ufj-pays-425-mln-for-15-stake-in-amp-capital

Stuff

Brazil’s huge hopes sinking?
Theworld’s largest iron ore carrier is disabled and could sink at a key Brazilianport from where Vale, the world’s No.2 mining company, loads about 10 per centof the global iron-ore trade, shipping agents and media said on Monday.
http://www.macrobusiness.com.au/2011/12/brazils-huge-hopes-sinking/?utm_source=Media+List&utm_campaign=6d1c4a12d7-RSS_DAILY_MAILCHIMP_CAMPAIGN&utm_medium=email

Negative gearing price models
Thereis widespread acknowledgement that Australian tax rules, particularly negativegearing and capital gains tax (CGT) discounts for assets owned for more than ayear, lead to higher home prices (and reduced tax revenue for government – inthe order of $2.5billion pa).
http://www.macrobusiness.com.au/2011/12/negative-gearing-price-impacts-modelled/

Negative Gearing Exposed

itis clearly the case that Australia’s taxation system has artificially increasedthe demand for housing, thereby putting upward pressure on house prices

http://www.unconventionaleconomist.com/2010/06/negative-gearing-exposed.html

Negative gearing (Australia)

http://en.wikipedia.org/wiki/Negative_gearing_%28Australia%29

India’s Rupee is Now Asia’s Worst Performing Currency

India’srupee has dropped nearly 13 percent against the dollar since the beginning of theyear, thanks to a combination of domestic and international factors. Right now,it’s Asia’s worst-performing currency.

http://online.wsj.com/article/SB10001424052970203611404577043600945741714.html

"There is nothing souseless as doing efficiently that which should not be done at all."

- Peter Drucker

Fortunatelyfor serious minds, a bias recognised is a bias sterilised."

--Benjamin Haydon, British painter and writer

2011-12-04T22:14:00.001-08:00

WooHoo,this weekend is one of my favourite journey swims, Bondi to Bronte.

Itis also the first serious surf swim of the season.

Thisis a 2.4km swim (subject to where they put the buoys) between the first twosurf life saving clubs in the world.

http://bonditobronte.com.au/

Ithink I missed this swim in 2010.

In2009, posn 839/1988, 120/215, 35:52 (Average time 37.13)

In2008, posn 595/1702, 50/153, 35.21 (Average time 38:09)

Lastweek-end was the Santa fun run.

Some of the best of photosfrom this year’s Santa Fun Run are available HEREon Variety Australia’s Facebook page.

Atthe start of the week CXE and BATS were poised, by the end of the week the dealis done. The bit that is left unsaid in these deals is the retrenchment andrationalisation that follows. Thoughts with all the CXE team.

Meanwhile...downunder....

ASXand CXA continue to acquaint themselves. Some early stats showing some niceearly market shares.

ASICruns the slide rule over ASX.

Aussiehas a new gold exchange! Welcome ABX. Another TLA (Three Letter Acronym).

Canada...comesshopping in Aust!

Tradewebcomes to Aust.

SFE,oops ASX24 (ridiculous name in my view), publish MF Global client list.

Columbo(Peter Falk) needed in Columbo (Sri Lanka)...I assumed Columbo ran onMillennium...I was wrong.

Byebye SecFinex.

IfI had more time, I’d rant a bit more about MF Global and the predicament ofvendors.

Greatto whip Westpac for the use of ‘Stress-Free’ but this is hardly the sort of flyby night advertising that puts a shiver down my spine. It’s the rest of thejunk that shouts out from the fly by night crowd in the Sunday rags (papers)

FunnyUBS say the Risk Officer departure is unrelated to Adoboli. Really?

Thankyou to my South African friends who have provided tremendous support for theblog this week...including the revised title of “Pete’s blog”...for now we’llstick with C&S...although other suggestions are always welcomed.

Havea great week end all.

Igotta run!

s.riley.mail@googlemail.com

http://clearingandsettlement.blogspot.com

Platforms

BATS Poised to Complete Acquisition of Chi-X Europe

BATS Global Markets said it received formalapproval from the United Kingdom’s Competition Commission to acquire Chi-XEurope, the largest pan-European trading venue.

This was the last regulatory approvalrequired to complete the acquisition. BATS will merge Chi-X Europe into BATSEurope to create BATS Chi-X Europe. The combined operation will be the largest electronictrading venue in Europe, exceeding the volume of the London Stock Exchange orthe Frankfurt Exchange.

BATS Chi-X Europe will handle approximately25% of European equities trading.

http://www.securitiestechnologymonitor.com/news/bats-Chi-X-UK-Nod-received-29623-1.html?ET=securitiesindustry:e3071:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=STM_BNA_08302010_112511

BATSCOMPLETES CHI-X ACQUISITION

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42218

Chi-X / ASX (source: IRESS)

	Chi-X		ASX		% Chi-X/ASX
21 - 25 Nov	132624	-23.08	6245796	5.12	2.12
14 - 18 Nov	172416	124.98	5941462	1.40	2.90
7 - 11 Nov	76636	310.26	5859346	-13.49	1.31
31Oct - 4 Nov	18680	na	6773086	na	0.28

As of today PureMatch is operational. PureMatch is an alternative orderbook introduced by ASX to facilitate high frequency traders.

http://www.asx.com.au/documents/trading_services/asx-purematch-factsheet.pdf

11-266AD ASIC releases ASX assessment report
http://www.asic.gov.au/asic/asic.nsf/byHeadline/11-266AD%20ASIC%20releases%20ASX%20assessment%20report?opendocument

Australia has a new Gold Exchange

Tradinghas commenced today on the Australian Bullion Exchange (‘ABX’), Australia’sfirst physical bullion exchange.

http://www.abx.com.au/

HKExResearch and Corporate Development has released the Derivatives MarketTransaction Survey 2010/11.

Thefull report of the survey is available on the HKEx website.

http://www.hkex.com.hk/eng/stat/research/research.htm

ASEANExchanges CEOs: Plans on Track to Promote ASEAN as an Asset Class

Following the November 2011ASEAN Exchanges CEOs meeting, the ASEAN Exchanges CEOs announced November 17that the collaboration framework is on track towards meeting its goals ofcollectively...

Theseven ASEAN Exchanges have a combined market capitalization of approximatelyUSD2.0 trillion and more than 3,600 companies listed on their exchanges.

http://www.asiaetrading.com/asean-exchanges-ceos-plans-on-track-to-promote-asean-as-an-asset-class/

Error Trade Triggers Colombo Exchange's CircuitBreakers

Anerror trade in the shares of a listed company triggered a market-wide halt onthe Colombo Stock Exchange (CSE) today.

Thevolatility safeguards in place on the Sri Lankan bourse ensure that trading ishalted if the Milanka Price Index (MPI) drops by more than five percent withinthe day from the previous market's close.

http://www.waterstechnology.com/sell-side-technology/news/2127742/error-trade-triggers-colombo-exchanges-circuit-breakers

Colombo Exchange Trading Systems

http://www.cse.lk/static/TradingSystems.htm

Canada Rising: CNSX Markets HoldsIts Own

CNSXMarkets was established in 2001, the year that the TSX acquired the CanadianVenture Exchange. Enter the CNSX, the first new Canadian stock exchange in morethan 75 years. The Toronto-based startup would try to carve out a niche foritself among Canada’s junior capital space, comprising firms in the oil, gas,base and precious metals, bio-farm and bio-tech industries. The CNSXmarketplace was launched in the summer of 2003 and a year later became a fullyrecognized stock exchange.

PureTrading, the CNSX’s ATS . Pure was a major change for the Canadian marketplaceand represented a significant technology overhaul in the industry, aseverything from order management systems (OMSs), data management systems andsmart order routers had to be upgraded.

Pureand the CNSX are lit markets, as are Omega, Alpha, Chi-X and the TSX VentureExchange (TSX-V). Currently, the dark liquidity conversation is in its infancy,as only 3 percent of Canadian trade volumes are transacted in the dark. But inJune alone, the country saw the addition of two new dark ATSs, and one lit ATS.

http://www.waterstechnology.com/waters/feature/2086364/canada-rising-cnsx-markets-holds

TMXRESOLVES STOCK SYMBOL MALFUNCTION

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42219

TMX Bids for Risk Management Software Vendor AmidTroubles

Canadianexchange operator TMX Group has entered into a takeover agreement withSydney-based risk management software provider Razor Risk Technologies and willacquire all of the vendor’s issued shares. The offer is for CAD$.0349 ($.0343)per share, equivalent to a purchase price multiple of one times annual sales asof June 2011. Razor’s board has indicated that it will accept the offer,subject to its terms and conditions.

http://www.waterstechnology.com/sell-side-technology/news/2129208/tmx-bids-risk-management-software-vendor-amid-troubles

NYSEEURONEXT TO SHUTTER SECFINEX

USexchange operator Nyse Euronext is to shutter its SecFinex securities lendingplatform in the face of a dismal economic climate.

NyseEuronext acquired a 51% stake in the London-based business in 2007 inpartnership with Societe Generale and Fortis.

SecFinextried to reposition as a central clearing counterparty, striking a deal withDTCC-backed EuroCCP to launch a service for the UK market.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23218

TRADEWEBINTRODUCES AUSTRALIAN GOVERNMENT BOND MARKETPLACE

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42235

Clearing

Acrossthe Pond

...isa DTCC publication designed to provide a "thumbnail" sketch offinancial regulatory reform activities in the United States and European Union.

Enjoy!....

http://www.euroccp.co.uk/leadership/newsletters/atp_issue8.pdf

Policy

Javelin in the News

http://thejavelin.com/

Participants:

Man’s Aussie client list.

Pursuant to Rule 5160(b), the Exchange has suspendedthe following entities’ admission as an ASX 24 Trading Participant:

* Biskra Aotearoa Limited
* Brahman Securities Pty Limited
* Epoch Capital Pty Limited
* GETCO Australia Pty Limited
* GFIN Pty Limited
* MW Markets Pty Limited
* Obmar Pty Limited
* Rouge Homme Futures Pty Limited
* Seacurl Trading Pty Limited
* Sean Taberner Trading Pty Limited
* Silkroad Capital Pty Limited
* S J L Hindsight Securities Pty Limited
* Spectrum Capital Proprietary Limited
* TransMarket Trading Pty Limited

http://www.asiaetrading.com/asx-24-suspends-14-trading-participants/

Furtherdetails are set out in ASX 24 notice No. 201/11

http://www.sfe.com.au/content/notices/2011/notice2011_201.pdf.

Bankrupt MF Global Sticks Tech Vendors with UnpaidBills

Alist of MF Global Holding's unsecured creditors and shareholders includes Caplin Systems Ltd.,owed $427,520; HeadstrongServices, an IT consultant, owed $3.9 million, Bloomberg Finance, LP, owed$276,064, according to a story in Bloomberg News, which cites the company'sbankruptcy filing and related court papers filed in the Manhattan bankruptcycourt.

Earlier this week, Patsystems, a provider ofscreen-based dealing systems for futures and options markets said it also issuffering a financial loss by the collapse of MF Global, its largest client.The shortfall in revenues from MF Global has led Patsystems to consider apossible takeover offer from ION Trading, a technology firm that currently owns29 percent of the company and is its largest shareholder. ION has valued eachshare in Patsystems at 14 pence or 20 cents per share, according to Monday'sstatement.

http://www.wallstreetandtech.com/trading-technology/232200547?cid=nl_at_daily&esid=899&rid=2083043&source=Email

JPMorgan Chase Remains Largest Bankin U.S.

Asof Sept. 30, JPMorgan had $2.27 trillion in assets, ahead of Bank of America(Charlotte, N.C), with $2.21 in assets, according to SNL. JPMorgan Chaseovertook BofA in October as the country's largest bank, a position held by Bankof America since it acquired Merril Lynch in the first quarter of 2009.

http://www.banktech.com/core-systems/232200339?cid=nl_bnk_daily

11-277MR Westpac reviews use of 'stress-free' inresponse to ASIC’s concerns
http://www.asic.gov.au/asic/asic.nsf/byHeadline/11-277MR%20Westpac%20reviews%20use%20of%20%20'stress-free'%20in%20response%20to%20ASIC%E2%80%99s%20concerns?opendocument

UBSCHIEF RISK OFFICER MISKOVIC REPLACED BY PREDECESSOR In the wake of its $2.3billion trading scandal, Swiss bank UBS has replaced chief risk officer MaureenMiskovic after less than a year in the job.

UBSinsists the departure of Miskovic is not connected to the events that sawLondon-based Kweku Adoboli make a loss of $2.3 billion through unauthorisedtrading.

Fullstory: http://www.finextra.com/news/fullstory.aspx?newsitemid=23216

Stuff.

Foreign Investment Decision - 25/11/2011

approvethe application by SABMiller PLC (SABMiller) to acquire Foster's Group Ltd(Foster's)

http://ministers.treasury.gov.au/DisplayDocs.aspx?doc=pressreleases/2011/145.htm&pageID=003&min=wms&Year=&DocType

Ohno...I’ll be drinking Sth African beer!

Virgin Australia Welcomes ACCC Approval of SingaporeAirlines Alliance

1 December 2011: Virgin Australiagroup of airlines today welcomed the ACCC’s final approval of its proposedalliance with Singapore Airlines.

http://www.virginaustralia.com/AboutUs/Media/NewsandPressReleases/P_019293.html

RBA loses pay autonomy for Stevens

TheRBA now pays Mr Stevens more than Federal Reserve chairman Ben Bernanke andEuropean Central Bank president Jean-Claude Trichet combined.

TheRBA chief's 2010 total compensation was $1.05 million, with an $805,000 basesalary. Mr Trichet was paid 367,863 euros ($500,000) last year, 2 per cent morethan his 2009 salary, according to the ECB's annual accounts published inMarch. Mr Bernanke earned $US199,700

http://www.smh.com.au/business/rba-loses-pay-autonomy-for-stevens-20110915-1kb53.html#ixzz1ezd5LSFM

Anold guy was working out in the gym when he spotted a sweet young thing...

Heasked the trainer that was near-by, "What machine in here should I use to impress that sweet thing over there?"
The trainer looked him up and down and said, "Try the ATM in thelobby."

"Don'ttry to stand out from the crowd, avoid crowds altogether" was a line fromIgnore Everybody (Ignore Everybody: and 39 Other Keys to Creativity by Hugh MacLeod); here I tried to illustrate it visually:

http://us1.campaign-archive2.com/?u=028de8672d5f9a229f15e9edf&id=99d23cf38a&e=6ac94dc2f4

Iliked this!

http://fc01.deviantart.com/fs13/f/2007/077/2/e/Animator_vs__Animation_by_alanbecker.swf

Brazil, Pipeline, BIDS, OTC trifecta ISDA BIS BoC, Man oh Man.....and Ho Ho Ho w/ Dawny nutters.

2011-11-27T14:29:00.000-08:00

This week end, we get into a bit of Ho, Ho, Ho.

The Santa Fun Run is a 5km run through Sydney city that is done in an official 'Aussie' Santa suit.

http://www.varietysantafunrun.com.au/NSW/

Dawny swim results are out:

http://www.oceanswims.com/images/downloads/dawnyres1124sex.html

I last did this swim in 2009, circa 44 minutes I think. This year, I came in with a time of 41:57. I certainly felt stronger in the water but the overall result is not much better (although there was a record turnout for this swim). I came in at pos’n 138 (139 in ’09) in a field of 313. 27^th / 62 in my age and 93 / 193 for the boys.

It amazes me a) how many people turn up to a swim on the banks of the harbour on a Sundee morning (nutters) and b) how good they are in the water.

...and how an Ocean swimmer should look...

http://www.youtube.com/watch?v=9X3mSSsjhgY

...looks so effortless in the water....makes my stroke look like a slap and a flap. :)

(don’t get excited, this is literally just an ocean swimmer plying his trade).

I loved this story!

A man after my own heart.

http://www.smh.com.au/wa-news/gold-thieves-behind-bars-20111123-1nuox.html

Brazil going through some real reform. BVMF doing a total systems overhaul....only for the technology to become attractive enough to enable competition. Welcome Direct Edge. One thing we experienced in the early days of Chi-X Europe was each time LSE sent a few million on increasing the capacity of trade elect, it just created more arbitrage opportunities. LSE investments increased our throughput and market share. Noice (said with an Aussie twang). Belated thanks guys.

Pipeline eats the inevitable result of what it sewed by trying.... to predict the trading intentions of Pipeline’s customers and trade elsewhere in the same direction as customers before filling their orders on Pipeline’s platform, the SEC said.

Thank you Tokyo and Osaka for finally putting us out of our misery and confirming this transaction. I thought it was done already.

I do like and respect IP. But I get a bit nervous when patents are awarded for things like matching. It looks like BIDS are more patents of algos but a CLOB’s a CLOB and I’d hate to see patented order types etc.

A flurry of OTC stuff out earlier in the week but I just haven’t had a chance to wade through it all. But some good extracts. For those following the OTC space, the Canadians are doing some good work. I recommend the Bank of Canada work. The Street wise professor highlights how we are simply massaging the risk stress ball... As one big corporate end user told him: clearing mandates have transformed credit risks into liquidity risks: I can manage the first, but the second scares me.

I agree.

WooHoo, IMC. HFT do get an unfair rap. Too much perception and not enough fact. It’s a shame we need a Principal Traders Association at all, but since we have one, I’m a fan.

MF Global woes continue. Through it all, my heart goes out to clients, creditors and staff. But I just think liquidators and receivers are self serving idiots looking after their own vested interests. (Umm, this is a sweeping generalisation and not directed at a specific or individual firm, you’re all tarred with the same brush). Liquidators don’t ‘get’ the markets they’re asked to look into. If there has to be a step in, I think there would be a much better outcome for all parties if it was via a secondment model of market practitioners.

More Euro woes. Hang in their Europe. She’ll be right. Inflation is coming to depreciate the debt away.

Play the Euro Zone Bank/country stress tester while you wait.

http://graphics.thomsonreuters.com/11/07/BV_STRSTST0711_VF.html

Enough, have a look at the economist computing power chart of the day and treat yourself to a free trading calendar....

The 2012 AsiaEtrading Cheat Sheet and Holiday Calendar is now available from the Download Center!

Get your PDF Cheatsheets now from AsiaEtrading

Cash (600kb) Download

Futures (600kb) Download

Both Zip Format (600kb) Download

Have a great w/end.

s.riley.mail@googlemail.com

http://clearingandsettlement.blogspot.com/

NB. All views are my own...well not really...my views have been shaped by other people’s views...anyway, this disclaimer means no one is responsible for any view. Is that how it’s supposed to work?

Platforms

Direct Edge to Launch Exchange in Brazil

The exchange will be headquartered in Rio de Janeiro and launch, if all goes according to plan, by the end of 2012. Direct Edge Brazil will be a rival to BM&FBovespa.

http://www.securitiestechnologymonitor.com/news/direct-edge-brazil-exchange-2012-launch-29595-1.html?ET=securitiesindustry:e3054:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=SIN_DailyClose__112111

Direct Edge Examines Clearing Options in Brazil

The operator of the EDGA and EDGX exchanges said it has reached out to BM&FBovespa for possibly handling its clearing. But it has “no announcement” to make.

http://www.securitiestechnologymonitor.com/news/direct-edge-brazil-clearing-options-29598-1.html?ET=securitiesindustry:e3054:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=SIN_DailyClose__112111

PLUS LAUNCHES EXCHANGE TRADING PLATFORM; TAPS QUANTHOUSE MARKET DATA FEED

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42074

Hong Kong Exchanges will now acknowledge orders in two milliseconds, a 70-fold improvement

Hong Kong Exchanges and Clearing Limited (HKEx) announced today (Wednesday) that an upgrade of its securities market trading system (AMS/3) from the current AMS/3.5 version to AMS/3.8 will be rolled out on 5 December 2011 (Monday). The rollout plan follows the successful completion of a series of market rehearsals and Exchange Participants’ (EPs’) confirmation of their readiness.

The upgrade will increase the securities market’s efficiency and transparency and pave the way for future growth. It will increase the trading system’s processing capacity over the current capacity by about 10-fold to 30,000 orders per second, scalable to 150,000 orders per second, and reduce latency to 2 milliseconds on an average trading day, about 70 times faster than present and better than the project target of 9 milliseconds at 30,000 orders per second.

http://www.hkex.com.hk/eng/newsconsul/hkexnews/2011/111116news.htm

Pipeline Will Divest Its Trading Operation

Milstream Strategy Group LLC, sought to predict the trading intentions of Pipeline’s customers and trade elsewhere in the same direction as customers before filling their orders on Pipeline’s platform, the SEC said.

http://www.securitiestechnologymonitor.com/news/pipeline-trading-biancamano-question-and-answer-29585-1.html?ET=securitiesindustry:e3048:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=STM_BNA_08302010_111811

TOKYO AND OSAKA EXCHANGES AGREE MERGER

The Tokyo and Osaka stock exchanges have agreed to merge in 2013 as they seek to strengthen their positions in a global market in the midst of a wave of consolidation.

Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23184

Former EuroCCP chief takes up LME role

The London Metal Exchange (LME) has announced that Trevor Spanner has started in his role as managing director of post trade services, a further step towards self-clearing for the commodities exchange

http://www.assetservicingtimes.com/assetservicesnews/article.php?article_id=2763

BIDS Wins Patents on Block Trading, Portfolio Balancing

BIDS Trading said it was awarded patents on block trading and on real-time balancing of portfolios.

http://www.securitiestechnologymonitor.com/news/bids-patents-block-trading-risk-portfolio-balancing-29616-1.html?ET=securitiesindustry:e3063:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=SIN_DailyClose__112311

Clearing

NASDAQ OMX UNVEILS RISK MANAGEMENT PLATFORM FOR NORDIC CLEARING HOUSE

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42075

Italian Clearing Buoys LSE's Bottom Line

Strong growth in its post-trade clearing operations helped grow income for 2011 79 percent from the year-earlier period.

The post-trade service unit’s total income, including net treasury income, grew 64 percent and revenues increased 8 percent, mainly driven by growth in clearing volumes. Interest earned on loans to clearing members of CCG including Italian banks increased a whopping 225 percent to 54.3 million British pound sterling, the LSE says.

http://www.securitiestechnologymonitor.com/news/lse-earnings-clearing-boost-29571-1.html?ET=securitiesindustry:e3036:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=SIN_DailyClose__111611

Bankers worried by uncertainty of market reforms

http://www.efinancialnews.com/story/2011-09-20/uncertain-outlook-for-market-infrastructure

Policy

ISDA analysis on COSTS vs benefit of Mandatory Electronic Execution for OTC Derivs

The paper finds that:

OTC derivatives pricing is extremely competitive, compares favorably to similar futures products and, unlike futures execution, is available in large transactions.
The electronic execution mandate and the proposed new regulatory framework will limit choice for end-users and ultimately increase transaction costs.
The possible benefits for small end-users will be no more than $1,000 for a $10 million interest rate swap before fees for execution and clearing. Any net benefit for small end-users will be dramatically outweighed by costs to the market as a whole.
Estimated initial set-up costs to market participants from the new rules are more than $750 million while ongoing costs are more than $250 million per annum.
The initial and ongoing costs identified in the paper amount to approximately $1,300 per transaction. These costs, of course, do not currently exist in the marketplace.
Derivatives users believe restrictive provisions in the proposed rules such as the 15 second rule, the requirement for at least five participants to quote through a request for quote (“RFQ”) platform, very high block trade thresholds and very short block trade reporting delays will negatively impact liquidity and push transaction costs up further.

http://singledealerplatforms.org/2011/11/14/isda-analysis-on-costs-vs-benefit-of-mandatory-electronic-execution-for-otc-derivs/#more-3607

Full 41 page ISDA paper available here:

November 10, 2011. ISDA Publishes Discussion Paper on: “Costs and Benefits of Mandatory Electronic Execution Requirements for Interest Rate Products” (http://www2.isda.org/news/isda-publishes-discussion-paper-on-costs-and-benefits-of-mandatory-electronic-execution-requirements-for-interest-rate-products)

http://www2.isda.org/

BIS REPORTS ON COUNTERPARTY RISKS IN CCP MODELS

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42065

The macrofinancial implications of alternative configurations for access to central counterparties in OTC derivatives markets

33 page report available here.

http://www.finextra.com/finextra-downloads/prdocs/cgfs46.pdf

Tim Lane, Bank of Canada, also gave an excellent speech on: Curbing Contagion: Options and Challenges for Building

More Robust Financial Market Infrastructure

6 page speech available here:

http://www.bankofcanada.ca/2011/09/speeches/curbing-contagion-options-and-challenges/

The Hon Bill Shorten MP, Assistant Treasurer and Minister for Financial Services and Superannuation has released a discussion paper on the handling and use of client money in relation to over-the-counter (OTC) derivatives transactions.

http://www.treasury.gov.au/contentitem.asp?NavId=037&ContentID=2231

29 Page discussion paper available here:

http://www.treasury.gov.au/documents/2231/PDF/DP_Client_Monies_OTC.pdf

Which bank/country will blow next?

Reuters Breakingviews has an interesting interactive Euro Zone Bank/country stress tester, which shows the impact on bank Tier 1 ratio and capital shortfall (1st tab) of varying Euro zone Debt 'haircuts' using slider control. They also have a similar stress tester for the impact on Euro zone country debt (2nd tab).

http://singledealerplatforms.org/2011/11/01/which-bankcountry-will-blow-next-new-online-game/

The bitter irony here is that many derivatives end users (real money investment funds, industrial hedgers) did not pose any real systemic risk under bilateral structures. But forcing them to clear drives them to utilize funding mechanisms that are systemically risky. As one big corporate end user told me: clearing mandates have transformed credit risks into liquidity risks: I can manage the first, but the second scares me.

http://streetwiseprofessor.com/?p=5698

Participants

Critics of high-speed trading are ignoring the facts

In an interview with Financial News , Remco Lenterman, the managing director of the Dutch firm IMC, argued that academic evidence showing the benefits of high-frequency trading is overwhelming and that its critics aren't being driven by facts.

Lenterman is also chairman of the European Principal Traders Association.

http://www.advancedtrading.com/articles/232200195?cid=nl_at_daily

MF Global's Aussie arm to close, 83 jobs lost

Broker MF Global Australia will be wound up in coming months after no offers were made for the business as a going concern.

http://www.smh.com.au/business/mf-globals-aussie-arm-to-close-83-jobs-lost-20111121-1nqwl.html#ixzz1eOdUrC6y

Buffett Invests $5 bln in Bank of America

http://www.reuters.com/article/2011/08/25/us-bankofamerica-idUSTRE77N4J420110825

BofA Merrill Announces Ultra-Low Latency Platform

Bank of America Merrill Lynch today announced BofAML Express, the firm’s new ultra low-latency market access and risk control platform for U.S. equities.

The platform delivers sub 10-microseconds of wire-to-wire latency and provides an embedded series of risk controls required by recent SEC regulation, according to the firm in today’s release.

http://www.advancedtrading.com/articles/231002175?cid=nl_at_daily

BNY Mellon and Jefferies partner for clearing

Jefferies has announced that its global execution and clearing services arm has been selected by BNY Mellon to provide support for its FCM offering

http://www.assetservicingtimes.com/assetservicesnews/article.php?article_id=2786

Stuff

The Rise of a Euro Doomsayer

http://finance.yahoo.com/news/rise-euro-doomsayer-155509377.html

Chart of the Day: Gold is running out of time?

Today’s chart comes from the McClellan Market Report (via Pragmatic Capitalism) and implies that the secular bull market in gold has several more years of outperformance over the equity market.

http://www.macrobusiness.com.au/2011/11/chart-of-the-day-gold-is-running-out-of-time/?utm_source=Media+List&utm_campaign=1648fe1a74-RSS_DAILY_MAILCHIMP_CAMPAIGN&utm_medium=email

Daily chart: Boots on the ground

Where American troops have served during the past 60 years

http://www.economist.com/blogs/dailychart/2011/11/american-troop-deployments?fsrc=nlw|newe|11-21-2011|new_on_the_economist

Daily chart: Computing power

The energy efficiency of computing is doubling every 18 months

http://www.economist.com/blogs/dailychart/2011/10/computing-power?fsrc=nlw|newe|10-10-2011|new_on_the_economist

CXA starts Fragulating ASX, NYSE DB, HK on and off CPs, Golden age of inflation....Dawny & it's just not cricket.

2011-11-20T13:53:00.000-08:00

Well, it’s not often I get a reminder to push the blog out from anxious readers....but it looks like I totally overlooked the cricket.

Bloke goes to a lady of the night and says 'I’d like to be dominated, what can you do for me?'
She says, ‘Mate, for AU$100, I can do utter domination and total humiliation.’
'Great' says he, 'so what do I get for my AU$100?'
She replies 'a baggy green cap and a white shirt'

For those non cricket followers you can see plenty of baggy greens at....

http://cricket.com.au/

At least this is lighter reading that the first test result.

Thank you so much to those generous South Africans that volunteered to arrange some extra tests...given that the Aussies can’t manage to play for 5 days...

Meanwhile, I’ll be turning my attention to the Dawny swim this Sundee.

http://www.oceanswims.com/Events.asp?EventID=275

Saturday I need to get back on the bike. We’ve booked a little father and son adventure in NZ:

4^th – 11^th Jan 2012.

http://www.otagorailtrail.co.nz/index.php?option=com_content&task=view&id=33&Itemid=48

First week of full trading for CXA. Depending on what and where you measure anything from 0.5% to 1.5% market share.

NYSE / DB remedies? I hope it’s just this press release that is scant on details. Who cares about 3^rd party access to a CCP? The point is 3rd party access to the trade feed. I hope that is what they mean.

LSE taking MF Global’s stake is a nice exit for the administrators. Book that deal at 21 euros!

Couple of CPs (Consultation Papers) I missed in HK on exchange and OTC clearing.

I like SwapBox. Euroclear should be doing more of these industry / utility services. I hope their pricing is utility sized too!

Now the central banks are piling into gold? That’s it, inflation is coming. Austerity is too hard and debt too big so a nice period of inflation should help to remove some of the debt mountain. Now, I’m betting the house on inflation booming. Any other good investment strategies for me?

ASIC consults on research separation (the old softing issue). Gotta be done in my view. Commoditised and transparent.

Virgin gets Northern rock for a 747. Funny.

For those that want a break from C&S, I recommend whats wrong with agriculture.

And as for the Euro? She’ll be right mate, it’s just a bit of a squeeze right now.

Piccie from:

http://www.macrobusiness.com.au/2011/11/chart-of-the-day-euro-probability/?utm_source=Media+List&utm_campaign=ae3fab70c7-RSS_DAILY_MAILCHIMP_CAMPAIGN&utm_medium=email

Another week flies by.

Have a great w/end all.

s.riley.mail@googlemail.com
http://clearingandsettlement.blogspot.com/

Platforms

Australian Exchange: Component Failed on Primary, Backup Systems

The Australian Securities Exchange said an electronic component involved in broadcasting market messages failed on its primary and backup trading systems, leading to its four-hour outage on October 27.

http://www.securitiestechnologymonitor.com/news/asx-component-failed-october-27-outage-29548-1.html?ET=securitiesindustry:e3029:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=SIN_DailyClose__111411

Initial ASX Circular on outage:

https://www.asxonline.com/intradoc-cgi/groups/trading_and_market_information/documents/communications/asx_031961.pdf

ASX Ltd. says it will begin offering transactions in the $1 trillion Australian managed funds market on April 15 next year.

http://www.iandtnews.com.au/homepage-featured-posts/asx-to-offer-managed-funds

Aussie Fragmentation.

http://fragmentation.fidessa.com/australia/

DEUTSCHE BÖRSE AND NYSE EURONEXT TO SHED BUSINESSES TO WIN EU APPROVAL FOR MERGER

Deutsche Börse and Nyse Euronext are proposing to divest their overlapping equity options business across Europe and open up third party access to Eurex Clearing in an effort to win EU approval for their $9 billion merger deal.

They have also agreed to grant unprecedented third-party access to Eurex Clearing for interest rate and equity index derivatives on a "fair, reasonable and non-discriminatory basis" and include cross margining.

More on this story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23176

Shanghai exchange is ready to let foreign issuers sell shares
The Shanghai Stock Exchange is prepared to allow foreign companies to list on the second-largest equity market in the world. Trading in foreign companies' shares should start "as soon as possible when the time is ripe", said Xu Ming, an executive at the exchange. "The internationalisation of the securities market will benefit the whole nation and overseas companies are highly motivated." Bloomberg (14 Nov.)

EGYPTIAN EXCHANGE LAUNCHES NEW TRADING PLATFORM

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42042

Clearing

LSE makes approach for MF's LCH stake

MF Global owns just under 2% of LCH, and administrators at KPMG are looking for a quick sale of the stake as they look to recoup significant proceeds from the broking firm.

The LSE's offer, possibly available at the same price as its EUR21-a-share bid for 51% of LCH, may be designed to prevent the stake falling into the hands of a counterbidder for the clearing house.

http://www.marketwatch.com/story/lse-makes-approach-for-mfs-lch-stake-report-2011-11-14

BM&FBOVESPA SELECTS CALYPSO TO REGISTER AND CLEAR OTC DERIVATIVESS

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42046

LCH.CLEARNET BEGINS CLEARING FOR TURQUOISE

http://www.finextra.com/news/announcement.aspx?pressreleaseid=42045

Consultation Paper on HKEx Clearing House Risk Management Reform Measures

http://www.hkex.com.hk/eng/newsconsul/mktconsul/marketconsultation.htm

73 page paper here:

http://www.hkex.com.hk/eng/newsconsul/mktconsul/Documents/cp201107.pdf

Consultation paper on the proposed regulatory regime for the over-the-counter derivatives market in Hong Kong

The Hong Kong Monetary Authority (the "HKMA") and Securities and Futures Commission (the "SFC") invite market participants and interested parties to submit written comments on the Consultation paper on the proposed regulatory regime for the over-the-counter derivatives market in Hong Kong (available as Acrobat PDF file) on or before 30 November 2011.

https://www.sfc.hk/sfcConsultation/EN/sfcConsultMainServlet?name=OTCReg

55 page paper at:

https://www.sfc.hk/sfcConsultation/EN/sfcConsultFileServlet?name=otcreg&type=1&docno=1

'Swapbox' Clears Short Positions in Greek Bonds

Euroclear Bank has created a “swapbox” based on algorithms which pair off short positions in Greek government bonds with long positions of the same value.

http://www.securitiestechnologymonitor.com/news/euroclear-debt-crisis-swapbox-greek-bonds-29551-1.html?ET=securitiesindustry:e3029:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=SIN_DailyClose__111411

Policy

Central banks accelerate gold purchases
Central banks more than doubled their purchases of gold in the third quarter compared with the previous quarter, when gold buying was already inflated, according to the World Gold Council. "Central-bank buying was a highlight of the quarter. Statistics this year have been remarkable," said Marcus Grubb, the council's managing director of investment. The Wall Street Journal (tiered subscription model) (18 Nov.), Financial Times (tiered subscription model) (17 Nov.)

11–255MR ASIC proposals for research houses

ASIC today released a consultation paper proposing research report providers, including research houses, separate their business units as a strategy to manage conflicts of interest as part of moves to improve confidence in the independence and quality of research reports.
This proposed segregation would involve strict and formal physical and electronic separation between ancillary business units such as consulting and funds management services and the research business.

http://www.asic.gov.au/asic/asic.nsf/byHeadline/11%E2%80%93255MR%20ASIC%20proposals%20for%20research%20houses?opendocument

Stuff

Whats wrong with Agriculture?

As it now stands, we have holdings in the low thousands of acres, with average revenue of less than $400,000 per annum on assets over $2.5 million – barely one-third of the revenue of a modern convenience store that has a few hundred thousand dollars invested, and where

the franchisee takes home more income each year than the average farmer.

There has to be a new approach: the old one isn’t working anymore.

http://www.ibisworld.com.au/images/marketing/WhatFutureforAgriculture-Nov2011.pdf

The British Treasury sold Northern Rock, the "good" part of a failed British bank that was taken into public ownership, to Virgin Money for £747m ($1.2 billion).

The auction to find a buyer for EMI concluded with the music label being split in two. Universal Music is to pay $1.9 billion for EMI's recorded-music division, and a consortium which includes Sony Music and the estate of Michael Jackson will buy EMI's music-publishing unit for $2.2 billion.

Imagination is more important than knowledge."

--Albert Einstein,
German-born physicist

News: Crikey Access Independence Dent, PureMatch, Hello PDQ, Plus a kerfuffle.....JPM Corp Cup and Heron report

2011-11-13T13:37:00.000-08:00

I totally forgot about the JPM Corporate Challenge this week. (I knew I was supposed to keep up the running in training for something). Anyway, a great event put on by JPM.

http://register.jpmorganchasecc.com/chasecc/results/show_individual.tcl?sub_event_id=41440&series_year=2011&result_id=1911487

I did around 34:47 in ’09, so satisfied with 32:35 this year.

The official race report is up from the Heron Island swim:

http://www.oceanswims.com/default2.asp?active_page_id=337

Next swim is the Dawny which I like as it gives you a chance to swim around Cockatoo island in Sydney harbour:

http://www.oceanswims.com/Events.asp?EventID=275

Then what I hope is the last run of the year:

http://www.varietysantafunrun.com.au/NSW/

I don’t usually worry about hackers etc. (why would you bother?)...but this offended my sensibilities.

Outrageous! By all means knock out the Dax...but leave sport out of politics!

(The only time politics is acceptable in sport is when the Aussie government is buying Olympic gold medals through direct subsidy of our sportspeople....other countries doing this is of course cheating).

HACKERS CONFUSE GERMAN STOCK EXCHANGE WITH FRENCH RUGBY SITE

Hackers have knocked out a French rugby club fansite, mistaking it for Deutsche Börse's Dax portal.

More on this story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23131

Australia lacks the satirical richness of the UK. We do have something in the vein of “private eye” with some objective journalism from crikey.com. I liked their story of the firm that did some of the lobbying for the ASX / SGX deal. I thought the access economics paper woeful at the time. Looks like it’s not the first time they’ve written to order rather than content.

Now that CXA has come to market, ASX launches purematch. (could be co-incidence?) The perfect trading book for blue chip names. Just fancy that!

I do like PDQ. Now that we’ve pretty much commoditised the price / time priority CLOB (you know, central limit order book), these variations on a theme will be the next differentiators.

Plus what a kerfuffle at Plus.

Rothschild (typical floor broker) only saw my position on Dodd Frank about 147 years before me. I hate frontrunners!

(http://en.wikipedia.org/wiki/Front_running)

My heartfelt congratulations to the EMCF team. 1 billion contracts....and that only in year to date.

Another landmark in the European landscape. Jolly good show chaps. Bravo!

Bitterballen and tulips all round!

(and why not make your own.... http://www.youcook.ca/blog/2010/02/hhh-bitterballen/)

Have a great week end all,

Whatever your leisure, make it a pleasure!

s.riley.mail@googlemail.com
http://clearingandsettlement.blogspot.com/

Platforms

ASX-SGX: why the combination is in Australia’s national interest

http://www.asxgroup.com.au/media/PDFs/20101206_ASX_SGX__AccessReport.pdf

Access is an economic consultancy (these days part of Deloitte) that hires itself out to anyone who wants an ‘independent’ economic research report to strengthen their case. And Access isn't shy about taking sides on major public debates.

There was its intervention, paid for by the Distilled Spirits Council of Australia, in the alcopops debate, labelled "as dodgy as a three-day-old kebab" by Nicola Roxon. Then there was its pro-industry efforts to sway the debate over carbon pricing – for the Australian Industry Greenhouse Network and the states – and its work for the big miners over the RSPT (on both the industry's current tax rate and the apocalyptic consequences of the RSPT), just to name a few.

http://www.businessspectator.com.au/bs.nsf/Article/Access-Economics-budget-forecasts-Deloitte-Austral-pd20111107-ND5F4?OpenDocument&src=pmm

11–250AD ASIC confirms ASX readiness to launch PureMatch
ASIC today confirmed it is satisfied that the ASX, prospective participants and data vendors are ready for ASX’s new order book, PureMatch, to commence operating from 28 November 2011.

PureMatch is an alternative order book that will operate in parallel to ASX TradeMatch, the primary existing ASX order book through which trading in ASX takes place. PureMatch will provide an alternative mechanism for trading of the most liquid cash market products which are traded on ASX’s TradeMatch.

http://www.asic.gov.au/asic/asic.nsf/byHeadline/11%E2%80%93250AD%20ASIC%20confirms%20ASX%20readiness%20to%20launch%20PureMatch?opendocument

New Equity Trading Venue Inserts Speed Bump

With the PDQ trading platform, an order is paused for a set period of time – 20 milliseconds — and in that time liquidity can be aggregated through an electronic crowd competing for orders, says Ross, who is a former options traders on the CBOE and also the former CEO of GETCO

“Institutions are annoyed with the high frequency trading guys, as they feel they are being gamed, while the HFT firms are concerned that institutions have better fundamental information in the short term,” he says. HFT shops that post first in the lit markets are subject to “adverse selection” by the institutions, he claims.

While PDQ’s electronic equity venue pauses the auction, it collects responses from the algorithmic liquidity responders and creates an order book based on price/time priority and then it executes the order against the book. The pause also enables PDQ to from a book with more size and better prices, contends Ross.

http://www.wallstreetandtech.com/electronic-trading/231902698?cid=nl_wallstreettech_daily

DB, NYSE Preparing Concessions for Europe's Regulators

NYSE Euronext and Deutsche Boerse have begun working on concessions to present to European regulators, after talks over the last two days with the European Union’s competition commission.
The two days of meetings “failed to alleviate antitrust regulators’ concerns about the $7 billion deal,’’ Bloomberg reported Thursday afternoon.
The European Union has set a November 17 deadline for proposing remedies.

http://www.securitiestechnologymonitor.com/news/deutsche-boerse-nyse-euronext-concessions-eu-29536-1.html?ET=securitiesindustry:e3017:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=STM_BNA_08302010_111011

VARDY RESIGNS FROM PLUS MARKETS

Plus Markets chairman Giles Vardy has stepped down following a shareholder-led revolt to forcibly oust him from the role Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23150

LSE SIGNS DELHI STOCK EXCHANGE TO MILLENNIUMIT PLATFORM The Delhi Stock Exchange (DSE) has signed for equity, derivatives, FX trading and clearing technology from the LSE's MillenniumIT unit.

Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23148

In addition, Hirander Misra, the former Chi-X Europe COO who over the summer quit Algo Technologies, the fintech vendor he helped set up, is in the frame to lead a revamped DSE, says the FT.

EUROPEAN ENERGY EXCHANGE SELECTS TRAYPORT GLOBALVISION

http://www.finextra.com/news/announcement.aspx?pressreleaseid=41909

Osaka Securities Exchange denies TSE-OSE merger reports

http://atmonitor.co.uk/news/newsview.aspx?title=osaka-securities-exchange-denies-tse-ose-merger-reports

HKEx Publishes its 2011 Third Quarter Results

http://www.hkex.com.hk/eng/newsconsul/hkexnews/2011/Documents/111111news.pdf

Clearing

EMCF CLEARS ONE BILLIONTH EQUITY TRANSACTION

http://www.finextra.com/news/announcement.aspx?pressreleaseid=41934

BM&FBOVESPA TAPS CINNOBER FOR CLEARING OVERHAUL Brazilian exchange operator BM&FBovespa has licensed technology from Swedish vendor Cinnober for a major revamp of its clearing operations.

Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23142

Stuff

“The few who understand the system, will either be so interested from it’s profits or so dependant on it’s favours, that there will be no opposition from that class.”
- Rothschild, London, 1863.

News: ASX ooops, CXA Ahhh, TMX, DTCC data x2, farewell MFG.....Heron Sharks, Easter Eggs

2011-11-13T13:34:00.000-08:00

Well, Heron Island was a great swim. Inaugural is the word. Swimming around an Island, you’re always going to be against the current one way or another, but to do it with king tides...there was some hard graft to be done along the front of the Island. Still, high tide means more water over the reef and more space for sharks to disperse. The snap (on the blog) is me with the sharks (thought you might prefer that to the image of an old tyre being washed up onto the shore after an hour at sea). I’ve come to the conclusion that sharks are 10% bigger under the water and 10% bigger again when you’re the only one in the water with them.

A great swim and apart from being whipped by those pesky Olympians, not a bad result.

http://www.oceanswims.com/images/downloads/heronres113.html

My kinda Easter egg:

Search Google for “recursion” and click the “Did you mean?” suggestion. Or call up the Sydney Opera House in Google Earth and then spin around to the waterfront side; a late, great TV celebrity waits for you there. Or ask Google Maps to give you the directions from Japan to China and marvel at Google’s suggestion for getting across the Pacific (step number 42).

http://www.scientificamerican.com/article.cfm?id=the-jokes-on-your-computer&WT.mc_id=SA_CAT_TECH_20111101

See Step 42 at:

http://maps.google.com.au/maps?q=Japan+to+China&saddr=Japan&daddr=China&hl=en&sll=-25.335448,135.745076&sspn=53.947846,60.292969&geocode=FRhxKAIdfJI9CCkvGX_XD05nNDFEUmZ81HVC9Q%3BFZw0IwIdReU1BinBQsblZI5QMTFvNp80fKodlQ&vpsrc=0&safe=high&t=m&z=4

Maple gets it’s TMX.

But I’ve dropped the ball on watching what’s happening with LME. Any insights appreciated.

BATS / CXE moves forward.

ASX oops....and CXA Ahhh.

DTCC having two data warehouses is just nuts. And saying just knowing US exposures is OK is also nuts in a world where we’re looking for consolidated views on exposures.

EMCF published interoperability service description...and welcomes Hugh.

MF Global is sad on so many levels. A firm going down because it didn’t stick with it’s knitting (commodities to sovereign debt is a bit of a jump), for the clients....but also for sooo many suppliers (be it PATS or any other). Then there is a displacement of all those people. The ED&F Man shop has had some good people through its doors. No-one likes to see exits in the style of Lehman, Madoff or MFG. Thoughts to staff, customers and suppliers.

Last week end of road training before the JPM corporate cup next week.

Good week end all,

Scott.

s.riley.mail@googlemail.com

http://clearingandsettlement.blogspot.com/

Platforms

TMX GROUP BOARD BACKS MAPLE TAKEOVER BID The board of TMX Group has finally recommended that shareholders accept a C$3.8 billion takeover offer from a consortium of Canadian banks and pension funds.

Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23108

BATS EUROPE MIGRATES TO EQUINIX DATA CENTRE

Binary Order Entry offers a new optional order entry method for participants to interact with the BATS Europe platform that further reduces latency. The full suite of BATS Europe order types will be available using Binary Order Entry, as well as the standard FIX protocol format.

http://www.finextra.com/news/announcement.aspx?pressreleaseid=41702

An Interview with Jeff Olsson, Group Executive, Technology, ASX

18/Oct/11

We have reduced latency from around 30 milliseconds five years ago to around 300 microseconds in ASX Trade at present (a hundredfold reduction). When the high speed matching facility (Purematch) goes live in Q4 this will be further reduced to around 100 microseconds.

The project is progressing according to the project schedule and still on track for the first system to go live at the end of the year (ASX Trade)

http://www.fst.net.au/Whoswho.aspx?id=471&op=au

ASX sheds light on recent outage, delays move to new data centre

03/Nov/11

ASX Limited has revealed the extent of the problems that shut down its ASX Trade platform last week for four hours and reportedly delayed its move to a new $32 million data centre in Gore Hill by three months.

http://technologyspectator.com.au/industry/financial-services/asx-sheds-light-recent-outage-delays-move-new-data-centre

Traders furious as glitch halts bourse

28/Oct/11

THE Australian Securities Exchange was working last night to repair the damage to its reputation after its recently installed trading system, run by the US exchange operator Nasdaq OMX, suffered its second setback in less than a year, causing a four-hour shutdown yesterday.

The outage also coincided with the final settlement day for October series exchange-traded options, leaving options traders furious.

http://www.smh.com.au/business/traders-furious-as-glitch-halts-bourse-20111027-1mm5o.html

Chi-X Australia reports successful debut

Chi-X Australia, the alternative trading platform owned by exchange operator and technology provider Chi-X Global, traded a total of A$3.84 million across the six stocks available on the first day of its soft launch, with no reported technical hitches.

http://www.thetradenews.com/trading-venues/exchanges/6979

TERAEXCHANGE PLANS CENTRAL LIMIT ORDER BOOK FOR SWAPS AND OTC CLEARED DERIVATIVES

http://www.finextra.com/news/announcement.aspx?pressreleaseid=41715

http://www.teraexchange.com/

ERIS EXCHANGE RECEIVES CFTC APPROVAL TO BECOME A DESIGNATED CONTRACT MARKET AND ANNOUNCES THE LAUNCH OF BENCHMARK FORWARD STARTING INTEREST RATE SWAP FUTURES

http://www.erisfutures.com/sites/default/files/Eris_Exchange_Press_Release_10_31_11_0.pdf

MALTA STOCK EXCHANGE SIGNS FOR XETRA E-TRADING PLATFORM The Malta Stock Exchange is set to roll out Deutsche Börse's electronic trading system, Xetra.

Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23119

Dark Pools Don't See Bright Future in Canada

Despite several dark pool launches north of the border this year, growth of the sector in Canada could be impeded by stiff regulation and a well-entrenched 'upstairs market.'

http://www.advancedtrading.com/crossingnetworks/231600189?cid=nl_wallstreettech_daily

Clearing

DTCC to Create A Second Data Warehouse for Swaps

The Depository Trust & Clearing Corp. has asked the Commodity Futures Trading Commission to register a new storehouse called the DTCC Data Repository that will keep track of details on transactions occurring only in the United States in different classes of derivative swaps.
DTCC does have a global swaps repository called Trade Information Warehouse. But a provision of the Dodd-Frank Wall Street Reform Act is leading to the creation of a separate warehouse of data on U.S.-only swaps.

http://www.securitiestechnologymonitor.com/news/swaps-dtcc-registration-cftc-29475-1.html?ET=securitiesindustry:e2982:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=STM_BNA_08302010_110111

HUGH BROWN JOINS EMCF AS DIRECTOR OF UK MARKETS

http://www.finextra.com/news/announcement.aspx?pressreleaseid=41811

EMCF INTEROPERABILITY SERVICE DESCRIPTION

In anticipation of the introduction of interoperability for Chi-X and BATS in January of next year we have produced a service description for your convenience.

The guideline contains practical and operational information about the set-up and processes around interoperability. The guideline can be found on our website under ‘projects’ and ‘interoperability’.

http://www.emcf.com/upload/uploads/111025%20Service%20description%20interoperability%20v1%20final.pdf

Participants

11-237AD MF Global
Tuesday 1 November 2011
ASIC is aware that companies in the MF Global group have been placed into administration. This impacts a number of companies in Australia.

http://www.asic.gov.au/asic/asic.nsf/byHeadline/11-237AD%20MF%20Global?opendocument

MF GLOBAL COLLAPSE HITS PATSYTEMS

Shares in UK screen-dealing software house Patsystems fell over 10% yesterday on news of the collapse of MF Global, a major customer accounting for recurring revenue of around £3 million.

Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23110

MF Global Workers Face Tough Job Market
Recruiters are flooded with resumes as workers at MF Global Holdings race to get hired before peers.

http://www.wallstreetandtech.com/career-management/231902206?cid=nl_wallstreettech_daily

Stuff

MUMBAI GETS DIAMOND-DISPENSING ATM

Indian jewellery firm Gitanjali has unveiled an 'ATM' that dispenses not cash but gold, silver and diamonds.

Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=23102

DOUBLE DUTCH?

The Anglo-Dutch wars of the 17th and 18th centuries were acrimonious even by the usual standards of war . The wars were a very long time ago and we are all friends now

The common strand in all of these disparaging 'Dutch' expressions is that anything Dutch is the opposite of what it ought to be. Examples of these expressions are:

Dutch bargain - a bargain made when one is debilitated by drink - first recorded in 1654.
Dutch defence - a legal defence in which the defendant seeks clemency by deceitfully betraying others - 1749.
Dutch comfort - cold comfort; only good because things could have been worse - 1796.
Dutch metal/Dutch gold - a cheap alloy resembling gold - 1825.
Dutch courage - brash bravery induced by drink - 1826.
Dutch treat - no treat as such; each person pays for their own expenses - 1887.

http://www.phrases.org.uk/meanings/double-dutch.html

We Aussies are financially joined at the hip with the US.

http://www.macrobusiness.com.au/2011/11/chart-of-the-day-sp-versus-asx/?utm_source=Media+List&utm_campaign=39a7602832-RSS_DAILY_MAILCHIMP_CAMPAIGN&utm_medium=email

Clearing and Settlement News

News 120120: NYSE DB sunk, Japan PTS 5%, Purematch, RBS, Penson Aust....Costa Concordia, Otago Rail Trail trail!

36thWarriewood to Mona Vale Ocean Swim

ASX technology chief steps down

OTCclearing - margin methodologies

Royal Bank Of ScotlandReorganisation - Full Statement

News: Demographics, Interoperability, Margining, G-SIFIs....and off to the shakey Isles.

Whatwill the world be like in 2012?

Themysterious millionaires factory

CME President Awaits theGreenlight for the Reopening of China’s Financial Derivatives Market

Ray White posts bestresults in eight months and says Gold Coast office surprise star

CXA mkt share, CXA TAS Oops, CXG, UBS, X-Clear yodels, EMCF OTC, Turquoise read all about it....and a southerly blows over Bondi to Bronti.

ASX glitch hits Chi-X settlementTheASX's trade acceptance service stopped clearing and settling trades by rivalexchange Chi-X from about 10am to 12pm yesterday, preventing orders from beingcompleted.http://www.smh.com.au/business/asx-glitch-hits-chix-settlement-20111206-1oh4j.html#ixzz1fqGs36Zi

Negative gearing (Australia)

India’s Rupee is Now Asia’s Worst Performing Currency

Canada Rising: CNSX Markets HoldsIts Own

Javelin in the News

Virgin Australia Welcomes ACCC Approval of SingaporeAirlines Alliance

Brazil, Pipeline, BIDS, OTC trifecta ISDA BIS BoC, Man oh Man.....and Ho Ho Ho w/ Dawny nutters.

Bankers worried by uncertainty of market reforms

In an interview with Financial News , Remco Lenterman, the managing director of the Dutch firm IMC, argued that academic evidence showing the benefits of high-frequency trading is overwhelming and that its critics aren't being driven by facts.

MF Global's Aussie arm to close, 83 jobs lost

The Rise of a Euro Doomsayer

Chart of the Day: Gold is running out of time?

CXA starts Fragulating ASX, NYSE DB, HK on and off CPs, Golden age of inflation....Dawny & it's just not cricket.

News: Crikey Access Independence Dent, PureMatch, Hello PDQ, Plus a kerfuffle.....JPM Corp Cup and Heron report

News: ASX ooops, CXA Ahhh, TMX, DTCC data x2, farewell MFG.....Heron Sharks, Easter Eggs

Chi-X Australia reports successful debut

ASX glitch hits Chi-X settlement
TheASX's trade acceptance service stopped clearing and settling trades by rivalexchange Chi-X from about 10am to 12pm yesterday, preventing orders from beingcompleted.
http://www.smh.com.au/business/asx-glitch-hits-chix-settlement-20111206-1oh4j.html#ixzz1fqGs36Zi