Random Market News, 25
"Here's what 4 analysts expect from Jackson Hole — the annual festival of central banking."
"Yellen issues broad defense of post-crisis financial rules.
Federal Reserve Chairwoman Janet Yellen said any rollback of post-crisis financial reforms should be "modest" because they've made the banking system safer and more resilient, rebutting Republicans in Congress and the White House who blame regulatory red tape for holding back the U.S. economy."
"Federal Reserve Board requests public comment on proposal to produce three new reference rates based on overnight repurchase agreement (repo) transactions secured by Treasuries.
The most comprehensive of the rates, to be called the Secured Overnight Financing Rate (SOFR), would be a broad measure of overnight Treasury financing transactions and was selected by the Alternative Reference Rates Committee as its recommended alternative to U.S. dollar LIBOR.
Another proposed rate, to be called the Tri-party General Collateral Rate (TGCR) would be based solely on triparty repo data from BNYM. The final rate, to be called the Broad General Collateral Rate (BGCR) would be based on the triparty repo data from BNYM and cleared GCF Repo data from DTCC."
"2 Societe Generale bankers indicted by U.S. Justice Department for LIBOR actions."
"States Stake Claim on Fintech Battleground.
Washington is easing financial regulation as a battle rages over the supervision of the fintech wave.
As the regulatory rollback gets underway, states are in sharp disagreement with Washington-based watchdogs over how to oversee the heady, financial technology sector, known as fintech. The Office of the Comptroller of the Currency — which supervises 1,400 national banks and federally chartered savings institutions — is facing a court challenge from state regulators who say one of its pro-fintech initiatives is illegal."
"Blockchain for KYC only a year away - R3.
The consortium said the tech would help corporates identify multiple subsidiaries and mutual ownership."
"No 2-and-20? No Problem.
As hedge fund investors continue to push back on fees, some managers looking to attract and keep clients are fundamentally changing how they charge for their services.
These methods can range from offering sliding-scale fees — such as an upfront fee break for so-called founding-class investors for taking a chance on a new firm — to multi-year incentive allocations that are based on performance in a given year, according to Steven Nadel, a partner at law firm Seward & Kissel who works with hedge fund firms."
"Systematizing the Oracle: A Quant Approach to Buffett's Investment Style.
Piotroski developed a scoring system to determine the strength of a firm’s financial position. Similar to Piotroski’s famous F-Score, for each of our criteria, companies that pass will score a one, those that do not, a zero. We can then simply add up these scores to come to an overall score of 0-6."
All models look good 'in sample'.
"Commentary: Toward simplicity in asset valuation models.
When valuing illiquid assets, complexity often breeds confusion. Clarity can better be found in sophisticated-but-simple models."
"Driverless Vehicles of the Future Confront Rules Written for Drivers.
When the U.S. government finally got around to regulating auto safety in 1967, it insisted that every car have seatbelts and that the steering column be engineered to absorb impact so it wouldn’t spear the driver.
The safety rulebook has since swelled to nearly 900 pages and encompasses everything from electronic stability control to rear-view backup cameras. Through all the updates, however, the regulations remain premised on an assumption that may soon be obsolete: that a human would be at the wheel.
That’s about to change. U.S. regulators could soon undertake one of the biggest overhauls of the Federal Motor Vehicle Safety Standards ever, one that would apply to cars that drive themselves."
VIX ~11.28. 10-yr treasury volatility (TYVIX) ~4.01.
Implied Fed rate hike/cut probability for September 20th is ~1.4%/0.0%, November 1st is ~5.4%/0.0%.
In the US, the most important events are the second estimate of GDP growth rate, non-farm payrolls, unemployment rate and ISM manufacturing PMI. Elsewhere, key data include UK and Germany consumer morale; Eurozone inflation rate; Japan unemployment rate, retail trade and industrial production; China PMI data; and GDP growth for India, Brazil and Canada.
US Stocks End Mixed On Friday After Yellen Speech
Wall Street closed mixed on Friday August 25th of 2017 after Fed Yellen made no comments on monetary policy during her speech at the Jackson Hole Symposium, disappointing inventors who were looking for clues on the timing of the next rate hike and the unwind of Fed's balance sheet. Most sectors ended with gains, with big technology companies lagging moderately. The Dow Jones edged up 30 points or 0.1% to 21814. The S&P 500 advanced 7 points or 0.3% to 2446. The Nasdaq lost 6 points or 0.1% to 6266. During the week, all major indices booked gains, with the Dow Jones climbing 0.6%; the S&P 500 0.8%; and the Nasdaq 0.8%.
Dollar Index Hits 15-month Low
US Dollar decreased to a 15-month low of 92.54.
Stocks in Chile Hit All-time High
IGPA increased to an all-time high of 25771.
Stocks in Brazil Hit 6-year High
iBovespa increased to a 6-year high of 71303.
Euro Hits 31-month High
EURUSD increased to a 31-month high of 1.1909.
The ECB governing council asked the EU parliament for greater powers to intervene in failing banks.
Germany’s constitutional court ruled that it has a duty to ignore the European Court of Justice in some situations. (Bloomberg)
Turkey Foreign Visitor Arrivals Rise the Most in 13 Years
The number of foreigners visiting Turkey jumped 46.4 percent to 5.08 million in July 2017 from 3.47 million in the corresponding month a year earlier. It was the sharpest increase since May 2004, mainly boosted by a rise in arrivals from Russia (up 1648.4 percent year-on-year to 835.5 thousand), Germany (up 3 percent to 680.6 thousand), Georgia (up 26.1 percent to 265.0 thousand) and Iran (up 89.6 percent to 254.0 thousand). Meanwhile, arrivals from the UK were almost unchanged at 278.0 thousand. Considering the first seven months of 2017, the number of foreigners visiting Turkey increased 21.9 percent to 17.33 million.
Turkish Lira Hits 37-week High
USDTRY decreased to a 37-week low of 3.4499.
Stocks in South Africa Hit All-time High
JALSH-All Share increased to an all-time high of 56721.
SSE Composite Finishes At 1-1/2 Year High On Friday
Financial Markets were quiet in the Asia-Pacific on Friday 25th of August. However, it was a different story in China, as fears over government debts risks were curtailed and upbeat earnings reports from bluechips exceeded expectations. Shanghai's SSE Composite surged 60 points, or 1.8 percent, to 3332 for its highest close since January 2016. Over the week, the index climbed over 3.7 percent. Materials and financial stocks led the rally with Aluminum Corp. of China jumping 6.3 percent, ICBC adding 3.7 percent and Bank of China up 3.2 percent. China's blue chip CSI300 jumped 61 points, or 1.6 percent, to 3796 and Shenzhen's Component Index advanced 105 points, or 1 percent, to 10,658."
"Air freight boost from rise in semiconductor shipments.
Specialist logistics providers are benefitting from “fundamental changes” in how semi-conductors are used by manufacturers."
"At least two Asia and Europe loops will need to be closed in the fourth quarter of the year, or sailings blanked, to avoid the prospect of excess capacity throwing supply and demand out of kilter.
According to new SeaIntel analysis, a capacity increase of 11.5% by the three east-west alliances between H2 2017 and H2018 will result in a weekly excess of some 28,300 slots between October and December this year – a change in fundamentals that will spark fears of a new rate war."
"Japan’s largest container line plans to test a remote-controlled vessel across the Pacific Ocean in 2019 as it pursues fully autonomous technology that could disrupt the global shipping industry."
"Leasing rules are changing, but fiscal advantages will remain.
Broad changes will go into effect a year from now altering how equipment leases are accounted for on corporate balance sheets. Yet those changes shouldn’t impact trucking too much.
New lease accounting rules will be hitting the books in a little over a year, changing how trucking companies that lease trucks, trailers and other equipment “recognize” the value of such assets on their balance sheets.
After a more than five year effort, the Financial Accounting Standards Board (FASB) issued what’s known as an accounting standards update (ASU) last year aimed at improving financial reporting about leasing transactions.
In essence, that ASU will require organizations leasing assets—referred to as “lessees”—to recognize on their company balance sheets assets and liabilities of equipment with lease terms of more than 12 months the “rights and obligations” created by operating or “finance” leases as well as capital lease.
Those changes go into effect for public companies starting December 15, 2018, and for all other organizations December 15, 2019."
"Mega-Rounds Boost Funding In Restaurant Tech.
July 2017 saw the two largest-ever restaurant tech deals: a $151M private equity investment by Vista Equity Partners to Providence-based Upserve, and a $101M Series C (with participation from Bessemer Venture Partners, Generation Investment Management, and Lead Edge Capital) to Boston-based Toast. Both startups provide software for restaurant management.
While these two recent mega-deals may signify investor interest specifically in restaurant software, the restaurant tech sector encompasses much more."
"Majority of U.S. consumers still download zero apps per month, says comScore.
Apps are dominating consumers’ digital media habits, but getting people to try new ones is still a tough sell. That’s the latest from comScore’s newly released 2017 U.S. Mobile Apps Report, which finds that 57 percent of consumers’ time spent using digital media is now taking place in mobile apps."
"Google’s Tensorflow team open-sources speech recognition dataset for DIY AI.
Created by the TensorFlow and AIY teams at Google, the Speech Commands dataset is a collection of 65,000 utterances of 30 words for the training and inference of AI models."
Voice training also typically requires significant pre-processing/smoothing, so not just a deep learning challenge.
"Nanotube-based Yarns Harvest Energy From Twisting and Stretching.
An international team of researchers led by researchers at the University of Texas (UT) at Dallas—where they have been working on making carbon nanotube-based yarns for well over a decade—has devised a way to make these carbon nanotube yarns into devices that can harvest energy from stretching or twisting them.
In research described in the journal Science, the initial results show promise for immediate use in powering small sensor nodes in Internet of Things (IoT) applications. The team says its nanotube yarns could produce larger amounts of energy by flexing and twisting in response to the movement of ocean waves."
"Magnetothermal Genetics: A Fourth Tool in the Brain-Hacking Toolbox.
A scientist wanting to hack into an animal’s brain used to have three different tools to choose from: electric current, drugs, and light. Now there’s a fourth: magnetic fields. In a paper published last week in the open-access journal eLife, scientists at the University at Buffalo used magneto-thermal genetics to manipulate brain cells in mice, enabling the researchers to control the animal’s behavior."
"Video Friday: Robogami, Flying Snake Robots, and Autonomous Car Eclipse.
Video Friday is your weekly selection of awesome robotics videos, collected by your Automaton bloggers."
Startup/SME of the Day.
The number and therapeutic quality of our stem cells diminishes with age.
Storing your stem cells today preserves them for future therapies that combat age-related disease, and perhaps aging itself."
"Pre-Hispanic City of Teotihuacan.
The holy city of Teotihuacan ('the place where the gods were created') is situated some 50 km north-east of Mexico City. Built between the 1st and 7th centuries A.D., it is characterized by the vast size of its monuments – in particular, the Temple of Quetzalcoatl and the Pyramids of the Sun and the Moon, laid out on geometric and symbolic principles. As one of the most powerful cultural centres in Mesoamerica, Teotihuacan extended its cultural and artistic influence throughout the region, and even beyond."
Evidence suggests a collapse following an underclass revolution against an oligopoly.
CN: Industrial Profits, 9:30 PM ET (8/27)
CH: Employment, 3:15 AM ET
EZ: M3 Money Supply, 4:00 AM ET
IT: Business and Consumer Confidence, 4:00 AM ET
US: International Trade in Goods, 8:30 AM ET
US: Dallas Fed Mfg Survey, 10:30 AM ET
JP: Unemployment Rate, 7:30 PM ET
https://tradingeconomics.com/calendar (More complete listing, including consensus)