Johnson Defeated in No-Deal Brexit and Election Votes – Financial Times

Humiliating setbacks leave UK prime minister ‘hostage’ in Downing Street.

Barnier Warns Brexit Talks in Paralysis – Financial Times

EU chief negotiator tells diplomats UK has presented no new proposals.

China and the US Will Hold High-Level Trade Talks in Early October – Wall Street Journal

Chinese and American officials plan to hold trade talks in Washington in early October, the latest attempt to tame a trade war that is rippling through the global economy and hurting business investment and confidence.

HK Leader Lam Says Hopes Extradition Bill’s Withdrawal Will Help Solve Crisis – Straits Times

Hong Kong leader Carrie Lam said Thursday her decision to scrap extradition legislation was only the “first step” to addressing the city’s unrest, after protesters said the chief executive’s concessions fell short of their demands.

Lagarde Pledges to Review ECB’s Negative Rates – Wall Street Journal

As she pitched to become the central bank’s new president, the former IMF chief also vowed to review bond-buying policies.

Central Banks Dust Off Old Tools to Stem Risks from Easy Money – Bloomberg

As global central banks swing back into easing mode, old tools long frowned upon by monetary purists are being embraced to ensure cash goes where it’s needed.

Regulatory News

Whistleblower Alleges Ethics Breach at FMSB – Financial Times

A whistleblower has accused top executives at the body set up by the Bank of England to guide financial market behaviour of perverting the course of justice, alleging that they put pressure on him not to testify as an expert witness in a case against a member bank.

US Authorities Fine OCC – Profit & Loss

The Securities and Exchange Commission and the US Commodity Futures Trading Commission have announced that the Options Clearing Corporation will undertake remedial efforts and pay $20 million in penalties to settle charges that it failed to implement policies to manage certain risks.

What’s Worse: Using Unreliable Poll Data or Encouraging Fast Traders? – Profit & Loss

The UK’s Financial Conduct Authority has issued a warning that trading on unpublished polls ahead of a UK general election or, who knows, another Brexit Referendum, could constitute a breach of its market abuse rules – although given the pollsters’ recent performance around the world one has to question why anyone would bother except as a reverse indicator!

ISDA to Create Custody Function for IM – Profit & Loss

The International Swaps and Derivatives Association and Linklaters have announced the addition of a new custody function on ISDA Create’s initial margin offering, which will enable users to complete all documentation required for regulatory IM on a single platform.

Australia’s Treasurer Wants New Inflation Deal with RBA – Australian Financial Review

Reserve Bank governor Philip Lowe will be required to write to Treasurer Josh Frydenberg explaining why the central bank has missed its inflation target, a move likely to raise pressure to cut interest rates further.

Crypto News

Is the Future of Finance Digital? – Profit & Loss

Back in 2013, when Profit & Loss first started writing about this new digital currency that was creating a buzz called “bitcoin”, most mainstream financial services firms wanted nothing to do with it.

Crypto Banking Regulation Around the World, First Signs of Growth – Coin Telegraph

Banking is often seen as the antithesis of Bitcoin the very industry the nascent protocol looks to defuse and disrupt. Ironically, many banks are desperately in need of the attributes and facilities afforded by cryptocurrencies — specifically blockchain, their underlying technology.

As Crypto Markets Go Cold, Who Will Pay for Open-Source Code? – Coin Desk

Earlier this year IBM purchased Red Hat, the oft-referred to model for how open source can thrive, for $34 billion. Long the consultant to enterprises, IBM is going through a transitional period as a business and needs a boost. Red Hat’s open-source software offers IBM the ability to better compete in cloud services offered by Amazon, Microsoft and Google. Why is this important?

Current Altcoins Won’t Recover, Next Boom to Be Led By New Crypto Assets – News BTC

The altcoin market is currently in crisis mode, with most of the various individual crypto assets outside of Bitcoin reaching new yearly lows, and in general, bleeding out all remaining value generated during the 2017 crypto hype bubble.

London’s Bitcoin and Blockchain Nightmare Could Be Coming True – Forbes

Bitcoin, cryptocurrency and blockchain startups exploded onto the London financial technology scene over the last few years, but now, due to a combination of potentially tougher new regulation and the UK’s looming exit from the European Union, things could be about to take a turn for the worse for the fledgling bitcoin and crypto sector.

Company News

UBS Plots Revamp of Investment Bank After Performance Falters – Financial Times

The bank’s main equities division will be combined with its smaller foreign exchange, rates and credit trading (FRC) operations to create a single securities and trading unit, said three people with knowledge of the changes. Jason Barron, head of equities, will run the unit alongside George Athanasopoulos, head of FRC.

FXSpotStream Hits New Volume Peak; Integral Also Rises – Profit & Loss

FXSpotStream has recovered from its dip in July to post a new peak for average daily FX volume on its platform in August. 

After Three Chinese banks are Bailed Out, are More at Risk? – The Economist

Widespread defaults are unlikely, but risk aversion is a danger in itself.

Hong Kong Exchange Operator Probes Trading Disruption – Financial Times

Hong Kong’s exchange operator said it was looking into disruptions of its futures and options market on Thursday as trading volumes for some futures contracts in the territory dropped precipitously.

Investment Banking Revenues Plunge to 13-year Low – Financial Times

Revenues at the world’s top investment banks plunged to a 13-year low in the first half of 2019 as geopolitical tensions, slowing growth and low interest rates compounded a structural decline that set in after the financial crisis.

Goldman Sachs’s Partnership Is Shrinking – Wall Street Journal

Goldman Sachs Group partnership is shrinking under a new chief executive who wants to restore its exclusivity.

Market Savvy

Will FX Go the Way of Treasury Futures? – Greenwich Associates

FX futures make up a tiny part of the global foreign exchange market today, but given recent changes, they and similar instruments have the potential to grow fast enough that FX may eventually follow in the footsteps of U.S. Treasuries—a market that was mostly OTC and in which futures now top cash trades in terms of average daily volume (ADV).

Recessions are Getting Less Common, but More Terrifying – Australian Financial Review

The world has seldom been worse-equipped to fight a recession. Yet it has never had fewer recessions to fight. 

Why US Claims that China is a Currency Manipulator are Groundless – South China Morning Post

The yuan has appreciated significantly since the global financial crisis, and a review of China’s policy decisions show that it has, in fact, done more than any other major economy to honour its commitment to hold the value of its currency.

The Philippine Peso’s Rally is Rapidly Unraveling – Bloomberg

The Philippine peso’s rally in the first half of the year is rapidly unwinding as rising global trade-war fears and faltering economic growth pummel the currency. Further losses may be in store.

US Economy Growing Modestly as Trade War Dents Activity: Fed – Reuters

The US economy grew at a modest pace in recent weeks, with manufacturing buffeted by a global slowdown while consumer purchases gave mixed signals on the strength of household spending, the Federal Reserve reported.