Category: World News (Page 1 of 10)

The EU Agrees on New Deal to Ban PFOF

Market News Daily - The EU Agrees on New Deal to Ban PFOF.
Market News Daily – The EU Agrees on New Deal to Ban PFOF.

The European Union (EU) has agreed on a new deal to ban PFOF, or Payment for Order Flow.

PFOF is the compensation a broker receives for routing trades for trade execution to a particular market maker.

The European Union said on Thursday that member states and the European Parliament have reached a deal on updating the bloc’s “MiFID” securities trading rules.

The EU has been reviewing its securities trading rules to reflect advances in trading technology and also the departure of Britain from the bloc, presenting new competition to EU markets, per Reuters.

“The agreement reached today imposes a general ban on ‘payment for order flow’ (PFOF), a practice through which brokers receive payments for forwarding client orders to certain trading platforms,” a statement from the EU member states’ council said.

Under the deal, member states that already allow PFOF will be exempt from the ban provided it is only offered to clients in that member state.

“However, this practice must be phased out by 30 June 2026,” the statement said.

The deal, which needs formal rubber-stamping from the full parliament and EU states, also sets up ‘consolidated tapes’ that would give investors a snapshot of stock and bond prices on markets to help find the best deals.

“Market data from all trading platforms will be included in consolidated tapes, which will aim to publish the information as close as possible to real time,” the statement said.

Will the U.S Ban PFOF?

Market News Daily - The EU Agrees on New Deal to Ban PFOF.
Market News Daily – The EU Agrees on New Deal to Ban PFOF.

As of right now, the SEC has stated that there is no plan to ban PFOF although the topic has been brought to the table.

SEC Chairman Gary Gensler last year said there may be a conflict of interest for brokers and that too much power is concentrated in a handful of market makers.

The abusive power of PFOF was felt during the ‘meme stock’ frenzy of 2021 when retail orders were being dealt by market makers and hedge funds betting against AMC Entertainment and GameStop stock.

But Citadel and other Wall Street giants have pushed back against the idea of banning payment for order flow.

A spokesperson for Citadel Securities released the following statement to CNBC:

“It is important to recognize that the current market structure has resulted in tighter spreads, greater transparency, and meaningfully reduced costs for retail investors. We look forward to reviewing the proposals and working with the SEC and the industry towards our longstanding objective of further improving competition and transparency.”

“You need to be very deliberate on that approach,” Ken Bentsen, president and CEO of the Securities Industry and Financial Markets Association (SIFMA) said.

“We have been calling for a review of market structure for some time, but let’s be careful not to try to fix things that may not be broken,” he said. “The retail investor is getting a better deal than they ever have.”

Read: “The Game is Rigged” Says Ex-Citadel Data Scientist

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Market News Today - The EU Agrees on New Deal to Ban PFOF.
Market News Today – The EU Agrees on New Deal to Ban PFOF.

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Elon Musk’s New Litigation Team is Taking on Wall Street

Market News Daily - Elon Musk's New Litigation Team is Taking on Wall Street.
Market News Daily – Elon Musk’s New Litigation Team is Taking on Wall Street.

Tesla Inc. (NASDAQ:TSLA) and SpaceX CEO Elon Musk says his new litigation team will go after Wall Street short sellers and other corrupt regulators.

Brandon Ehrhart, General Counsel and Corporate Secretary at Tesla posted on LinkedIn more details.

“Are you an experienced partner at a top law firm?

Do you enjoy handling sophisticated litigation and trials but are frustrated by internal issues like conflicts and passing on work for clients you love?

Tesla Legal is building something unique: a full-scale internal litigation and trial team that can handle all aspects of litigation and trial work, including briefings, hearings, discovery, depositions and trials, completely in-house.

Apply online and see if you qualify for a team that handles cutting-edge and sophisticated legal work itself with NO conflicts.

Because we are one team with one mission: to accelerate the world’s transition to sustainable energy.”

Source: LinkedIn Post.

Elon Musk on Wall Street Short-Sellers

Elon Musk responded to the publication on Twitter sharing Brandon Ehrhart’s LinkedIn post with the following statement:

“Tesla will continue to use outside litigators, but it’s important to build a powerful litigation team internally, so that we’re not always on the defensive.

We’ll also go after the Wall St short-sellers, certain law firms & (sometimes) corrupt regulators who are the true evil.”

Elon Musk has been outspoken about short sellers in the past and has even had quarrels with the Securities and Exchange Commission (SEC) in the past.

“I want to be clear, I do not respect the SEC. I do not respect them”, said Elon Musk in an interview with CBS’s 60 Minutes.

Musk’s war with short sellers goes beyond advocating for his company.

He spoke out against shorts during the ‘Meme Stock’ frenzy of 2021, when large groups of retail investors on Reddit squeezed short sellers from their short positions in GameStop, AMC, and other companies.

“u can’t sell houses u don’t own u can’t sell cars u don’t own but u *can* sell stock u don’t own!? this is bs — shorting is a scam legal only for vestigial reasons,” Elon said in a tweet in January 2021.

Failure in Regulation for Short Selling in America

Regulators have strengthened punishment for naked short selling in South Korea and other parts of the world.

For example, The Financial Investment Services and Capital Markets Act of South Korea was revised in April 2021 so that illegal short sellers will face pecuniary penalties instead of fines.

According to the amended act, the maximum pecuniary penalty is equal to the amount of illegal short selling.

In addition, violation may lead to at least one year in prison or a fine equivalent to 300 to 500 percent of the illegal profit or avoided loss.

This model is raising attention in the United States as the predatorial practice has dominated the industry for decades.

But CEOs such as Roger Hamilton of Genuis Group (GNS) and John Brda, formerly of Torchlight/Meta Materials, and others have begun to take legal action against naked short selling.

The retail community has raised awareness through social media activism and peaceful protests, as seen on Occupy The SEC 2023, of the market injustices investors face today.

One of the most recent and most alarming frauds in Wall Street takes shape in the FINRA and MMTLP scandal – where investors’ money disappeared out of thin air when the self-regulatory agency halted buying and selling prior to delisting the ticker completely.

MMTLP shareholders have their money stuck in limbo with Project Veritas founder James O’Keef now looking at the story.

And with Elon Musk’s new litigation team going after Wall Street short sellers, it certainly brings about a new confidence in the possible changes that may occur in the markets this decade.

Market News Published Daily

Market News Today - Elon Musk's New Litigation Team is Taking on Wall Street.
Market News Today – Elon Musk’s New Litigation Team is Taking on Wall Street.

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Credit Suisse Investors Want the Board in Jail

Market News Daily – Credit Suisse Investors Want the Board in Jail.

Credit Suisse Investors say they want the board of directors in jail after they blocked executive pay plans during the final ever annual meeting.

According to The Guardian, shareholders used most of the nearly five-hour annual general meeting in Zurich – the last in the 167-year-old bank’s history – to voice fury over poor management, hitting out at excessive pay for “incompetent and greedy” bankers who they said took too many risks and endangered Switzerland’s economic prosperity.

In November of 2022, the bank warned investors in a 6-K filing of potential losses due to naked short covering.

Credit Suisse took a massive hit of $4.09 billion in Q3 and hinted at occurring losses in an upturn in markets.

The bank hired 20 banks for a $4 billion injection in effort to pivot from Q3’s disaster and also postponed publication of its annual report earlier this year, per Reuters.

This led clients to withdraw billions of dollars, sending shares on a freefall.

Even after the bank was bailed out, investors continued to pull their money out.

UBS agreed to buy Credit Suisse but sources say 10,000 jobs may have to be cut if the two banks combine.

Investors Scrutinize Credit Suisse in Last Ever Shareholder Meeting

Credit Suisse Shareholders in Zurich - The Guardian.
Credit Suisse Shareholders in Zurich – The Guardian | Credit Suisse Investors Want the Board in Jail.

Board members were criticized for being too quick to agree to its takeover by UBS last month and striking a bad deal for investors, although bosses said the only alternative was bankruptcy.

“This is a dishonorable day for Switzerland,” one investor said.

“I believe we have basically lost trust in the Swiss financial sector.”

Another lamented the collapse of its shares, which he said were now worth no more than a “sack of walnuts”, and offered some shells as a gift to the chair, Axel Lehmann.

Another said it meant livelihoods of pensioners who relied on Credit Suisse stock had “gone up in smoke”, and warned that people “might even think of killing themselves because they no longer have any money left”.

He said the board needed to be held responsible for the many scandals that plagued the bank, including tax evasion and fraud.

“These people should be taken to court, should be put behind bars, and should no longer be allowed to practice their profession,” the shareholder said.

Credit Suisse Chairman Blamed Retail Investors

Credit Suisse Chairman Axel Lehmann blamed the bank’s collapse on retail investors during an interview in Switzerland.

“Last autumn we had a social media storm and this had huge repercussions, more in the retail sector than in the wholesale sector, and too much becomes too much.

And that’s when we reached this point, it’s an accumulation of various facts that contributed to one another then materialized at some point.

And this then caused the situation.”

Axel Lehmann’s response to who was responsible for the disaster of Credit Suisse only goes to show the lack of accountability.

The bank’s own investors said Credit Suisse board members should go to jail and be prohibited from practicing in the profession.

The question is how many more times will banks continue to screw the average investor?

Retail investors have mocked Credit Suisse for its attempt to short and distort AMC Entertainment just months before its troubles.

While many thought the largest movie theatre chain in the world would fall for bankruptcy, it was the bank who ironically turned out to be the biggest disaster in the financial and banking industry.

Market News Published Daily

Market News Today - Credit Suisse Investors Want the Board in Jail.
Market News Today – Credit Suisse Investors Want the Board in Jail.

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Citadel’s Ken Griffin Warns of Recession in America

Market News Daily: Citadel's Ken Griffin warns of recession in America.
Market News Daily: Citadel’s Ken Griffin warns of recession in America.

Citadel’s Ken Griffin warns of a recession in America, though many would be quick to state the nation is already in one.

Bank of America and Wells Fargo were one of the first to warn people in Q4 of last year.

Ken Griffin’s hedge fund Citadel was amongst the very few who turned in profits last year when majority of the industry lost $208 Billion for clients.

This marked the biggest single-year decline since 2008, when they lost $565 billion, LCH data showed.

Citadel’s gain of $16 billion last year was the largest annual gain ever made by a hedge fund manager, LCH said.

Retail investors grow weary of the hedge funds gains, comparing Ken Griffin to Bernie Madoff, who also never posted losses despite the industry crashing.

“The game is not fair and it never has been. Individual investors, even when operating in a swarm, are destined to lose. How do I know? I helped design the game,” says ex-Citadel Data Scientist Patrick McConlogue.

But Ken Griffin says he sees a setup for a US recession primarily due to people’s savings accounts being tarnished.

Here’s what the Citadel CEO had to say.

Ken Griffin Sees Setup for a US Recession

Market News Daily: Citadel's Ken Griffin warns of recession in America.
Market News Daily: Citadel’s Ken Griffin warns of recession in America.

(Bloomberg) Ken Griffin said the setup for a US recession is unfolding, with the Federal Reserve needing to raise interest rates further after Americans were stung with “traumatic” levels of inflation.

The founder of Citadel and Citadel Securities said the Fed is limited in how much it can fight inflation with interest-rate increases, likening the tool to “having surgery with a dull knife.”

“We have the setup for a recession unfolding,” he said in an interview with Bloomberg in Palm Beach, Florida.

Ken Griffin said he would advise Powell to say “less” on inflation.

“Every time they take the foot off the brake, or the market perceives they’re taking their foot off the brake, and the job’s not done, they make their work even harder.”

Ken predicted in 2020 that US markets would struggle with rampant inflation.

He said his firm is not far away from current market consensus on price growth.

“Americans are burning through their pandemic savings, and soaring interest rates are threatening the housing market and other parts of the economy.

That’s a recipe for a downturn, Ken Griffin told Bloomberg.”

Related: Citadel, Charles Schwab Team Up to Destroy SEC Proposals

Ken Griffin News: Citadel’s Ken Griffin talks recession, inflation, + more.

Market News Published Daily

Market News Daily: Citadel's Ken Griffin warns of recession in America.
Market News Daily: Citadel’s Ken Griffin warns of recession in America.

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