[00:00:06] Welcome to the John Lothian News daily Update podcast for February 1, 2024. I am your host, John Lothian. This podcast is brought to you by John Lothian News thank you for joining us. Here are the hits and takes commandments from today's JLN Today is the 20th anniversary of the founding of Crystal clear communication, Ellen Resnick's public relations firm providing communications counsel to and partnering with leading financial exchanges, clearing brokerage and trading firms, and fintech and reg tech companies across multiple continents. It's hard to believe that it has been 20 years since Ellen launched Crystal Clear.
[00:00:48] I first met Ellen when I called her to talk my way into the press conference to announce one Chicago, when the John Lothia newsletter did not have a name and it was a viral marketing offshoot of my brokerage operations. As head of the electronic trading division of the Price Futures group, Ellen and I had a rocky start, complicated by my bifurcated role as a broker and blogger. I could get into CME meetings wearing my broker hat that journalists could not giving me an information advantage. Ellen needed to manage this with other journalists who covered the CME, which I understood. But it was also an advantage for the CME where she was head of corporate communications for me to create buzz for the exchange.
[00:01:38] After she founded Crystal Clear, we found ourselves on the same side often as she had clients who were John Lothian news or Marketsweaky sponsors. Needless to say, our relationship improved. I have always had the greatest respect for Ellen and her work as she is a brilliant communicator, strategist and writer. She is also one of the most ethical people I know, which is not a common trait in all public relations people. Ellen has thanked the many people who helped her during her 1st 20 years of running crystal clear in a LinkedIn post. You can read with a link in today's newsletter. The AFM conference in Bangkok has started and AFM chairman Pat Kenny is on the stage. There's a link for a picture in today's newsletter. JLN has published three video shorts on LinkedIn from our two part series with Birmingham Southern College president Daniel Coleman. The videos include one with Coleman talking about missing talking to people about the markets. Second is a video of Coleman talking about raising money for Birmingham Southern and how investors could turn around the college. The third video is Coleman on what college should be like and what classes that should be core. Today, FIA published its FIA update with January 2024 highlights on LinkedIn the MFA Network Miami 2024 is going on right now and is the largest on record with over 900 attendees, the MFA shared on LinkedIn.
[00:03:26] I am starting to work on setting up video interviews for FIA's Boca Raton, Florida International Futures conference. If you or your firm are interested in participating in a video interview with John Lothian news, please contact me at
[email protected] the UN Sustainable Stock Exchanges initiatives SSE launched a toolkit for exchanges to help guide markets on the new IFRS sustainability disclosure standards. The toolkit helps exchanges and market participants with model guidance that has been reviewed by the IFRS International Sustainability Standards Board. Issb. Details on the toolkit, which is free to download, can be found with a link in today's newsletter our most read stories from our previous edition of JLN options were if Trump wins, the market could skyrocket. Be ready for anything from Barron's fast, exact, joint S and P 500 VIX smile calibration in discrete and continuous time from risk net and China stock sink to five year low as traders unwind rescue bets from Bloomberg, subscribe to the free JLN Options newsletter with a link in today's JLN. Here are more stories from the first read section of today's JLN. Here's the video series that we had yesterday. The journey of Daniel Coleman from english literature to financial markets part one Daniel Coleman's path to success in the financial markets is a tale of a chance encounter that led him to a career he never anticipated. Born in Alabama, Coleman embarked on a journey that took him from the Ivy League halls of academia to the high stakes world of trading in Philadelphia, Chicago and New York, and back home in academia's highest level. Watch this video on johnlothiannews.com and then here's a second video reviving Birmingham Southern Dan Coleman's journey to save a struggling college. Dan Coleman left KCG after it was acquired by Virtu Financial and moved back to Birmingham, Alabama to contemplate his future. He reached out to a local college, Birmingham Southern, whose board he once served on. Little did he know he would soon end up as its president. You can watch this video on johnlothiannews.com.
[00:06:05] Here's a press release from Fiatech. Fiatech launches global client operations team for trade data network clients joint offering with e clerks to simplify client onboarding and resolve trade breaks. Fiatech, a leading futures industry technology provider, and eclerx, a market leader in business process management, today announced they have launched an integrated global client operations team to monitor trades and allocations being processed on Fiatech's trade data network, TDN. The jointly staffed team is designed to support and augment clients own operations teams to identify trade breaks and other risk events as they occur instead of on t plus one. As is commonplace across the industry today, this service, a combination of automated exception management and 24 x five global operations support, will be available to all TDN brokers and clients at no additional cost. My comment I will be talking to FIA tech soon and sharing more details with you. Here is another story, this one from the Wall Street Journal. The headline the intelligence paradox AI may make markets less rational. Even the smartest algorithm has to operate within limitations on risk and capital.
[00:07:37] The evolution of artificial intelligence raises profound questions for financial markets. Will human portfolio managers become obsolete as AI algorithms become smarter? Will markets become perfectly efficient and reflect the ultimate equilibrium in which prices mirror economic reality without human distortion? Economists longstanding debate about market efficiency sheds light on these questions. In the 1970s, Eugene Fama argued in his efficient market hypothesis that asset prices reflect all available information, and it is therefore impossible for an investor to outperform the markets consistently. This thesis shaped modern finance, only to be countered a decade later by Robert Schiller, who argued that stock prices are more volatile than would be expected if investors were making decisions based on strictly rational thinking. He processed instead that human irrationality drives market bubbles, crashes, and overall inefficiency. Despite their opposing views, Mrs. Fama and Schiller were jointly awarded the Nobel Prize in 2013. My comment who said the markets are rational? Here's another story, this one from the Financial Times. The headline Joe Biden appoints John Podesta as the US's top climate diplomat. Veteran of Clinton, Obama and Biden administration replaces John Kerry. Joe Biden has appointed his clean energy advisor, John Podesta, as the US's top climate diplomat, moving swiftly to fill the vacancy despite a looming presidential election. The appointment comes at a critical time for U. S. Climate and international energy policy, with allies concerned about the country's commitment to global climate goals if Donald Trump wins the 2024 presidential election. My comment the thing I like about presidential administrations is they are like old tires. Lots of retreads. Here's another story, this one from the Telegraph. The headline a third world war would transform global finance beyond recognition. Given the risks, you might expect the ever more apocalyptic warnings of World War Three, now almost daily trouted out by the politicians and the military, to be more obviously reflected in the behavior of financial markets. Even comparatively localized wars tend to be deeply damaging to the economies involved, though there are exceptions which I will come to. But world wars are on another scale, entirely hugely destructive events which take decades to recover from. If fought in the modern age, with its lethal nuclear arsenals, it might even prove existential.
[00:10:42] My comment I have a great idea. Let's not do this. Here are the top three stories from Wednesday's JLN. Our top story Wednesday was the Financial Times german derivatives exchange Urex appoints ABN AMro's Bougie as new chief. Robert Bougie was also our markets wiki page of the day. Second was Bloomberg's millennium to back Goldman Sachs veterans Asia hedge fund. Third was the Financial Times should savers worry about compensation after HSBC? Fine. Here are the top three stories from the lead section of today's JLN. The first story is from the New York Times. The headline generative AI's biggest impact will be in banking and tech report says for some companies, the new technology is an opportunity to enhance productivity and profit. Will their workers benefit as well? A new generation of artificial intelligence is poised to turn old assumptions about technology on their head. For years, people working in warehouses or fast food restaurants worried that automation could eliminate their jobs. But new research suggests that generative AI, the kind used in chatbots like OpenAI's Chat GBT, will have its biggest impact on white collar workers with high paying jobs in industries like banking and tech. A report published Thursday by the Burning Glass Institute, a non profit research center, and SHRM, formerly the Society for Human Resource Management, stops short of saying the technology will do away with large numbers of jobs. But it makes clear that workers need to better prepare for a future in which AI could play a significant role in many workplaces that until now have been largely untouched by technological disruption.
[00:12:49] Here's another story. This is the LinkedIn Post from Ellen Resnick, president at Crystal Clear Communications commemorating the 20th anniversary of crystal clear communications. Today marks 20 years since I founded Crystal Clear Communications. It's been quite a journey. I've been privileged to provide communications counsel to and partner with leading financial exchanges, clearing brokerage and trading firms, and fintech and regtech companies across multiple continents. Little did I know when I left what we now call CME Group that I would remain closely associated with the futures industry and financial markets for two more decades and counting.
[00:13:33] And then here's a story from the Wall Street Journal. The headline Julius Baer CEO exits over 700 million dollar signal loss Julius Baer put the spotlight back on risks at Switzerland's banks. With the departure of its chief executive and a big writedown of loans extended to property magnet Renee Benko, the private bank took a full loss allowance on the roughly $700 million it lent to Benko, the austrian developer whose empire extended to a stake in the Chrysler building, and his Cigna group that halved its full year profit to 454,000,000 swiss francs, or about 527,000,000 U. S. Dollars.
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