Untitled Document

April 13, 2005

Lead Stories

Nybot hires bank, considers co-op structure

By LEAH MCGRATH GOODMAN, Dow Jones Newswires

NEW YORK (Dow Jones/AP) _ The New York Board of Trade has hired an investment bank to help it assess its strategic options, with the most likely one being a transition to a cooperative structure, the exchange's top executive said Tuesday. The commodities exchange, which now operates as a not-for-profit organization, has retained New York investment bank Brown Brothers Harriman & Co. "We are looking at possibly changing into a co-op structure," Nybot President and Chief Executive Harry Falk said at an industry conference in New York.

http://www.newsday.com/news/local/wire/newyork/ny-bc-nybot-structure0412apr12%2C0%2C3015003.story?coll=ny-region-apnewyork

NYSE looks to future after settling with SEC

Representatives of the New York Stock Exchange hope that the Securities and Exchange Commission settlement reached Tuesday ends a painful chapter in the exchange's history. The settlement calls for the Big Board to spend $20 million to fund four biannual outside audits of its regulatory practices.

http://news.yahoo.com/news?tmpl=story&u=/usatoday/20050413/bs_usatoday/nyselookstofutureaftersettlingwithsec

For An Elite Few, Some Special Attention

NEW YORK - Yesterday's indictment of 15 specialists raises some serious questions, perhaps about the specialists, but certainly about the accusers.

The criminal charges come while the very idea of specialists is under attack and a year after the settlement of a civil case against the seven New York Stock Exchange specialist firms for $243 million, but with no admission of wrongdoing. Now the U.S. Justice Department is alleging criminal wrongdoing by 15 individuals who allegedly helped their firms to illicit profits of $13.4 million over four years. Thirteen of the 15 have left their firms. Prosecutors say the former specialists violated rules by "interpositioning," that is trading between market orders, and by "trading ahead" of customer orders. Spokesmen for the U.S. Securities and Exchange Commission, which filed charges against the indicted 15 and five others, would not specify how these individuals were caught. But since specialist firms, by design, routinely trade for their own accounts while acting as brokers for others, it would seem difficult to distinguish an illicit trade from an ordinary one.

http://www.forbes.com/services/2005/04/13/cx_da_0413topnews.html?partner=rss

The Outsider, Staying Put at Morgan Stanley

At a memorial service in January, two men joined in a hard, awkward embrace: Philip J. Purcell, the chief executive of Morgan Stanley and Robert G. Scott, a former president of the firm who was forced out of his job by Mr. Purcell in 2003. Mr. Scott, who is now leading a campaign to oust Mr. Purcell, quickly joined a crowd of Morgan Stanley bankers mourning the death of the firm's former chairman, Richard B. Fisher. Mr. Purcell made his exit from Riverside Church in upper Manhattan alone.

Two weeks into the battle for control of one of Wall Street's oldest firms, Mr. Purcell, who has used his outsider status to secure a string of successes, now finds his job and legacy at stake because of his uneasy relationship with the Wall Street establishment.

http://www.nytimes.com/2005/04/13/business/13wall.html

South American Soybean Industry Meetings

The CBOT will be hosting industry meetings in Chicago, Rotterdam and London to brief market participants on the new South American Soybean futures contract.

http://www.cbot.com/cbot/pub/cont_detail/0,3206,998+27591,00.html

Chicago http://www.cbot.com/cbot/pub/page1/1,3248,1940,00.html

Rotterdam http://www.cbot.com/cbot/pub/page1/1,3248,1999,00.html

Floor trader charges shine harsh spotlight on NYSE

NEW YORK (Reuters) - The indictment on Tuesday of 15 former and current New York Stock Exchange floor traders for trading abuses puts the Big Board's corporate governance travails back on the front burner - during a time when the exchange needs all the goodwill it can muster.

http://www.reuters.com/newsArticle.jhtml?storyID=8162094&type=businessNews

Trading scandal uncovered in NY Stock Exchange

Reporter: Karen Percy

ELEANOR HALL: To the United States now, where securities regulators have taken unprecedented action against the New York Stock Exchange over an illegal trading scandal that's rocked Wall Street.

http://www.abc.net.au/worldtoday/content/2005/s1344328.htm

Ex-NYSE traders charged in scams

http://www.newsday.com/business/ny-bzfrau134215844apr13,0,6385589.story?coll=ny-business-leadheadlines

NYSE FLOORED

April 13, 2005 -- Let the howls against self-regulation begin again.

http://www.nypost.com/business/44434.htm

NYSE scandal holds good news, too

A scandal can destroy an institution. Or it can renew it.

http://www.iht.com/articles/2005/04/13/business/nyse.html

List of Specialists in NYSE Fraud Case

The 15 people indicted on charges of securities fraud, and the firms where they work or were formerly employed. If convicted, they each face up to 20 years in prison and fines of up to $5 million.

http://news.yahoo.com/news?tmpl=story&u=/ap/20050413/ap_on_bi_ge/nyse_specialists_list_1

15 Specialists From Big Board Are Indicted

By JENNY ANDERSON

Federal prosecutors indicted 15 former New York Stock Exchange floor traders, who are charged with cheating customers by mishandling trades to enrich their firms.

http://www.nytimes.com/2005/04/13/business/13nyse.html

Opportunity Spreads Across the Atlantic

By Howard Simons, RealMoney.com Contributor

Last week's foray into the spread between the U.S. large-capitalization and small-capitalization stocks as represented by the Russell 1000 (RIY) and Russell 2000 (RTY) indices, respectively, can be extended across the Atlantic. The spread between the Russell 1000 and the Dow Jones Euro Stoxx 50 (SX5E) index embeds elements of international diversification, sector analysis and currency trading all at once.

http://www.thestreet.com/_tscrss/options/futuresshocktsc/10216919.html

SG Securities Ups Deutsche Boerse Fair Value

1139 GMT [Dow Jones] SG Securities lifts Deutsche Boerse (DB1.XE) fair value to EUR61 from EUR54 to account for share buyback program. If company buys shares for around EUR60, the actual share capital bought back by AGM on May 25 should be circa 7%, it says.

http://www.newratings.com/analyst_news/article_775436.html

German Stocks Including Continental Slip; Deutsche Boerse Gains

April 12 (Bloomberg) -- German stocks including Continental AG, DaimlerChrysler AG and Volkswagen AG fell, pacing declines by automotive companies. Deutsche Boerse AG, Europe's biggest stock exchange by market value, rose on plans to buy back as much as 10 percent of its own shares.

http://www.bloomberg.com/apps/news?pid=10000100&sid=aoz0JMLQSP5I

Environmental Trading News

Sullivan & Cromwell LLP Joins Chicago Climate Exchange

Apr 13, 2005 - (New York) - Sullivan & Cromwell LLP today announced that it has committed to become an associate member of the Chicago Climate Exchange, thus becoming the first major international law firm committed to neutralizing its emissions of greenhouse gases through the purchase and retirement of carbon credits and/or purchase of offsets.

http://www.chicagoclimatex.com/news/articles/newsScroller2005041311154901.html

Energy Risk - Earth Day to Spotlight Conservation

The federal government can play a role in facilitating and encouraging wise energy use, while simultaneously protecting the environment and conserving natural resources.

With Earth Day 2005 approaching, policymakers and activists are presenting a host of ways consumers can cut their energy bills and take steps to clear the air at the same time. The U.S. Department of Energy's theme for the April 22 event is "See Your Energy Use in a New Light" and it encourages federal agencies, federal workers, and others to "see the light" and do more to save energy and money.

http://www.garp.com/risknews/newsfeed.asp?Category=6&MyFile=2005-04-13-10602.html

Trade CO2; It is a Gas!

Chicago Climate Futures Exchange SO₂ Allowance Cash and Futures Market Prices Survey Report Wednesday, April 13, 2005 9:30 a.m. Central Time Report
SO₂ Allowance Cash Market Survey
Vintage Bid Offer Last
2005 (or earlier) $875 $890 $880 (Apr. 12)
2006 $870 $885
*Cash Market Price Survey Overview* The SO₂ cash market price information provided above reflects central values of price ranges gathered from randomly selected market participants from energy, brokerage and financial firms. The 9:30 a.m. Central Time report is based on information gathered between 9:10 and 9:25 a.m. Central Time. The 11:45 a.m. Central Time report is based on information gathered between 11:25 and 11:40 a.m. Central Time.
April 12, 2005 Settlement Prices
CCFE SO₂ Futures Market¹ Prices		CCFE SO₂CVD² Futures Market Price
Contract Price		Contract Price
June 2005 $870		June 2005 $870
Sep 2005 $870		Sep 2005 $870
1 CCFE SO₂ futures contracts allow sellers to deliver allowances with 2006 vintage or earlier. 2 CCFE SO₂ CVD futures contracts require sellers to deliver current or earlier vintage. The above prices refer to the CCFE SO₂futures contracts and CCFE SO₂ CVD contracts. Further information on these contracts is available in the CCFE rulebook. For the 9:30 a.m. report these are the prior day futures settlement prices. For the 11:45 a.m. report these are the mid-day CCFE prices that reflect either last trades, volume-weighted best bids and offers, or if market conditions appear unchanged, prior-day settlement prices.
*Disclaimer* Cash market information provided herein is a summary of quotes provided to CCFE by market participants. The information does not represent a recommendation, trading advice or prediction of market conditions CCFE takes no responsibility.

You can sign up for the above emailed report by emailing to corpcomm@chicagoclimateexchange.com

Exchange News

Planting & Stocks Reports Will Impact April USDA Updates

...recent reports...had some curves that could have an impact on the April 8 old-crop supply/demand updates.

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1027+27592,00.html

2005 Corn Outlook

A presentation on the 2005 Corn Outlook.

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1027+27593,00.html

April USDA Revisions had Twists from Trade Expectations

The USDA's April supply/demand & world production updates had some of their usual twists...

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1027+27594,00.html

NYSE Regulation Announces Disciplinary Actions Against One Member Firm and Seven Individuals

http://www.nyse.com/press/1113216387586.html

Fact Book

http://www.tse.or.jp/english/data/factbook/index.html

Mid-term Managemant Plan (For FY2005 to FY2007)

http://www.tse.or.jp/english/ir/financials/plan/index.html

Personnel Changes At Admission Board Of SWX Swiss Exchange

http://www.exchange-handbook.co.uk/news_story.cfm?id=52353

Filings by Designated Contract Markets (DCMS) Current Month
Date of Letter	Date Filed	DCM	Description
04/11/2005	04/11/2005	CBOT	Rule Numbers – 425.01 Establish speculative position limits and reportable position levels for CBOT South American Soybean futures.

Regulatory News

The SEC News Digest

The SEC News Digest provides daily information on recent Commission actions, including enforcement proceedings, rule filings, policy statements, and upcoming Commission meetings.

http://www.sec.gov/news/digest/dig041205.txt

Florida Federal Court Orders Two Florida Residents and Investors Freedom Club To Pay Over $4 Million In Restitution and Civil Penalties in Forex Commodity Scam

http://www.cftc.gov/opa/enf05/opa5066-05.htm

Former NYSE specialist members charged with securities fraud

Stem from investigations by U.S. Attorney’s Office, SEC

http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=28416&IdSection=8&cat=8

OSFI gets high marks as regulator

Survey shows 92% satisfaction rating, up three points from 2002

http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=28412&IdSection=8&cat=8

Judge slams SEC, Justice Department probes in Scrushy case

BIRMINGHAM, Ala. - The Justice Department and the Securities and Exchange Commission improperly merged their investigations of fraud at HealthSouth Corp., a federal judge ruled in throwing out three perjury charges in the fraud trial of former CEO Richard Scrushy.

http://www.tallahassee.com/mld/tallahassee/business/11377798.htm

H.K. Firm Fined For Client-Identity Breach

Hong Kong 's Securities and Futures Commission has censured and fined Instinet Pacific for violating the SFC's client-identity rule, which requires firms to tell the regulator who are the underlying clients of certain transactions within two days of the SFC asking for it.

http://www.compliancereporter.com/default.asp?page=1&SID=494979&ISS=14042&pressbox=1

Managed Futures - Managed Funds

Is There Still Time to Catch the Hedge-Fund Bus?: Matthew Lynn

April 13 (Bloomberg) -- There are few experiences so upsetting as watching lots of people mint themselves a fortune while you miss out.

http://quote.bloomberg.com/apps/news?pid=10000039&refer=columnist_lynn&sid=asINsVPhknF4

Asian hedge fund managers mull SEC registration

HONG KONG, April 13 (Reuters) - Asian hedge fund managers are mulling registration with the U.S. Securities and Exchange Commission in a move that could open their coffers to more investor money, but invite greater regulatory scrutiny.

http://asia.news.yahoo.com/050413/3/1zaas.html

CSFB Hedge Fund Investments Group Launches Registered Funds of Hedge Funds in Five Categories

CSFB's Hedge Fund Investments group is pleased to announce the April 1, 2005 launch of funds of hedge funds registered with the US Securities and Exchange Commission. The five fund strategies are Multi-Strategy, Long/Short Equity, Relative Value, Tactical Trading and Event Driven.

http://biz.yahoo.com/bw/050413/135474.html?.v=1

Hedge Fund Do-Gooders

Hedge funds are desperately looking for ways to make money. The latest trend: shareholder activism.

http://biz.yahoo.com/fool/050412/111332607113.html?.v=1

John Henry

The John W. Henry & Company, Inc. web site -- <www.jwh.com> -- has been updated with detailed composite performance information on our various investment portfolios through the month of March 2005.

Reports

Bond Talk Today's Events

http://www.bondtalk.com/global.cfm?S=todaysevents

USDA Today

http://www.usda.gov/nass/PUBS/TODAYRPT/TODAY.HTM

Miscellaneous News

CHINA ENERGY WATCH: Gasoline Futures Coming, But Not Yet

By Sherry Su A DOW JONES NEWSWIRES COLUMN SINGAPORE (Dow Jones)--Regulators in Asia's main oil trading center, Singapore, need to look out: Big Brother China is moving fast, and in one case, has already overtaken them. With volumes of fuel oil futures traded in the Shanghai Futures Exchange now exceeding Singapore fuel oil swaps trades, the

http://au.biz.yahoo.com/050413/18/42ns.html

Ex-trading manager at Western Gas sued

Federal regulators sued a former Western Gas Resources Inc. trading manager Tuesday in federal court in Denver, claiming he profited illegally by manipulating natural-gas prices. The U.S. Commodities Futures Trading Commission alleges that Andrew K.

http://www.denverpost.com/Stories/0,,36~33~2813286,00.html

SET aims to promote market-maker system

Local brokers say that implementing a market-maker programme for the local securities market would require financial incentives.

http://www.bangkokpost.com/Business/11Apr2005_biz27.php

Two Top Morgan Stanley Bankers Quitting

http://news.reuters.com/newsArticle.jhtml?type=businessNews&storyID=8169425

Morgan Stanley M&A Bankers Perella, Meguid, Will Quit (Update3)

April 13 (Bloomberg) -- Joseph Perella and Terry Meguid, Morgan Stanley's top two investment bankers, plan to resign as the exodus of senior managers from the world's No. 2 securities firm gathers pace.

http://www.bloomberg.com/apps/news?pid=10000087&sid=a18lKEh0GBvs

Morgan Stanley's Vice Chairman to Resign

NEW YORK (Reuters) - Joseph Perella, Morgan Stanley (MWD.N) vice chairman and the company's investment banking chairman, is resigning from the firm, a spokesman said on Wednesday.

http://www.nytimes.com/2005/04/13/business/13wire-morgan.html

DTCC's Networking Service for Fund Industry Enhanced to Support Greater Transparency of Breakpoints

The Depository Trust & Clearing Corporation announced today that it has launched Networking for Direct Accounts to help the mutual fund industry achieve greater operational transparency and to support regulatory recommendations surrounding breakpoints.

http://biz.yahoo.com/bw/050413/135471.html?.v=1

The Bank of New York's Pershing Unit Announces Agreement to Deliver Streamlined Annuity Solution

Pershing LLC, a member of BNY Securities Group and a subsidiary of The Bank of New York Company, Inc., announced that its NetExchange Pro online brokerage platform will include software solutions developed by Blue Frog Solutions, Inc., a leading provider of life and annuity software solutions and business process outsourcing for insurance companies and financial services intermediaries.

http://biz.yahoo.com/bw/050412/125840.html?.v=1

Schwab Foundation to cut amount of grants in half

Charles Schwab's family foundation was born out of his long struggle with dyslexia, first as a student and later as a parent whose youngest son was diagnosed with the learning disability.

http://www.mercurynews.com/mld/mercurynews/11381449.htm

Charles Schwab consolidates data

Financial services company Charles Schwab & Co has selected Teradata to provide datawarehousing technology to support its reporting and analytical needs.

http://www.computerweekly.com/Article137889.htm?src=rssNews

General Colin L. Powell (Ret.) to Deliver Closing Keynote at Schwab Institutional's 15th Annual Impact(R) 2005

Schwab Institutional, a division of Charles Schwab & Co., Inc., has announced that General Colin L. Powell will be a keynote speaker at the 15th annual IMPACT® 2005 conference, one of the largest annual gatherings of independent investment advisors in the nation.

http://biz.yahoo.com/prnews/050413/sfw013.html?.v=6

STOXX Ltd. To License Pan-European Select Dividend and Broad European Indexes to Indexchange

ZURICH, Switzerland, April 11, 2005 (PRIMEZONE) -- STOXX Ltd., the leading European index provider, today announced that it has licensed four of its indexes to Indexchange, the German investment company that specializes in exchange-traded funds. The Dow Jones STOXX Select Dividend 30 Index, Dow Jones EURO STOXX Select Dividend 30 Index, Dow Jones STOXX EU Enlarged 15 Index and Dow Jones EURO

http://au.biz.yahoo.com/050411/21/41ln.html

TradeStation Group, Inc. Announces The Date For Its 2005 First Quarter Earnings Conference Call

http://biz.yahoo.com/prnews/050413/flw099.html?.v=5

Newspapers need focus on reader, editors told

WASHINGTON - Buffeted by declining circulation numbers, increased pressure for profits and growing public mistrust, the newspaper industry is again roiled with angst about its long-term future.

http://www.newsday.com/business/ny-bzasne134215520apr13,0,3441054.story?coll=ny-business-headlines

Wachovia Enters New Institutional Clearing Services Business

Wachovia Corporate and Institutional Trust announced today the launch of its Institutional Clearing Services group. The primary focus of this newly established business unit is to provide non-fully disclosed securities clearing and financing to the institutional marketplace.

http://biz.yahoo.com/prnews/050413/clw011.html?.v=5

Illegal GE rice contaminates food chain in China

13 April 2005, Beijing, China -- Greenpeace is calling for an urgent, international product recall after uncovering the illegal release of a variety of genetically engineered (GE) rice in China. The GE rice has not been approved for human consumption and may have contaminated Chinese rice exports.

http://www.ems.org/nws/2005/04/13/illegal_ge_rice_

Crowds Drawn to Pig Olympics in China

These pigs run, jump and swim — almost anything but fly. Thousands of Shanghai residents have turned out to a city park to watch a herd of pigs compete in what organizers are calling the "Pig Olympics."

http://story.news.yahoo.com/news?tmpl=story&cid=817&e=3&u=/ap/china_pig_olympics

**** In other fascinating pig news, Globex Lean Hogs traded 533 contracts yesterday.

John's Comments

CBOT 100 Oz. Gold Sets New Open Interest Record

The CBOT’s 100 Oz. Gold Futures set a new open interest record yesterday with 4,571 contracts now open, beating the old record of 4,535 set on April 11, 2005.

*********

Thought of the Day?

The more precisely you plan, the harder destiny hits you.

**********

Brent Crude Watch

IPE Electronic Brent Volume: 101,645

NYMEX Brent Crude Volume: 24,152 * record volume and open interest

********

Chicago Electronic Trading Scorecard for April 12, 2005

Percent Electronic

CBOT: 71.57%

CME: 76.69%

CME Eurodollars: 77.21%

CME Live Cattle: 1.06%

CME Currency Products: 84.62%

CBOT Soybeans: 4.43%

CBOT Options: 4.89%

CME Options: 9.83%

Volume

OneChicago Volume: 14,896

Eurex US Volume: 12,843

Euronext.liffe Eurodollar Volume: 35,151

CBOE Futures Exchange Volume: 968

Market Share

CBOT 100 oz. Gold Volume: 1171

NYMEX 100 oz. Gold Volume: 39,048

CBOT Share: 2.91%

NYMEX Share: 97.09%

CBOT 5000 oz. Silver Volume: 250

NYMEX 5000 oz. Silver Volume: 15,420

CBOT Share: 1.60%

NYMEX Share: 98.40%

CBOT Mini Gold Volume: 805

CBOT Mini Silver Volume: 677

CME Emini Russell 1000 (100X) Volume: 3707

Eurex US Mini Russell 1000 (100X) Volume: 2032

NYBOT Mini Russell 1000 (50X) Volume: 828

CFE Mini Russell 1000 (100X) Volume: 2

CME Emini Russell 2000 Volume: 136.109

Eurex US Mini Russell 2000 Volume: 7384

CFE Mini Russell 2000 Volume: 193

Notes: Euro FX futures at the CME set daily volume records for Globex volume and total volume yesterday.

Liffe Eurodollar Over-Under

Liffe/Globex: 2.47%

Liffe/CME: 1.92%

Regards,

John J. Lothian

Publisher

John Lothian Newsletter

www.johnlothiannewsletter.com

Futures Brokerage - Business Intelligence

John J. Lothian
President- Electronic Trading Division

The Price Futures Group, Inc.
141 West Jackson Blvd., Suite 1340A
Chicago, IL 60604

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