August 3, 2005

 

Lead Stories

 

CFTC Suspends and Restricts Registration of Chicago Mercantile Exchange Cattle Trader Dean Kaulentis

Cattle Trader’s Registration Suspended for Six Weeks and Then Restricted for Three Years

WASHINGTON, D.C. – The U.S. Commodity Futures Trading Commission (CFTC) announced today that on August 1, 2005, it simultaneously filed a notice and issued an order settling an administrative action against Dean Kaulentis of Lake Forest, Illinois. The CFTC order suspends Kaulentis’ floor broker registration for six weeks beginning on Monday, August 8, 2005, and restricts his registration for three years.

The CFTC’s notice and order are based on prior disciplinary action taken against Kaulentis by the Chicago Mercantile Exchange (CME), in which the exchange found that Kaulentis had engaged in uncommercial conduct and acts substantially detrimental to the interest and welfare of the exchange. The CME charged that in 2001 and 2002, Kaulentis pre-arranged trades of Live Cattle futures contracts opposite other exchange members, instead of competitively executing his customer orders. The CME also charged that Kaulentis assigned a trade to himself at a better price than his customer received. The CME ordered Kaulentis to repay the affected customer $4,200, fined Kaulentis $75,000, and suspended Kaulentis’ trading privileges for thirty days.

http://www.cftc.gov/opa/enf05/opa5105-05.htm

 

Russell 2000 hits a record high

NEW YORK -- Wall Street surged higher Tuesday, carrying the Russell 2000 to a record close as investors welcomed encouraging economic data and a continuation of double-digit corporate earnings growth. The Standard & Poor's 500 and Nasdaq composite indexes again reached their best closing levels in more than four years.

http://www.suntimes.com/output/business/cst-fin-econ03.html

 

Small-cap stock rally defies skeptics

http://news.reuters.com/newsArticle.jhtml;jsessionid=GYNC3AE1NCREICRBAE0CFEY?type=reutersEdge&storyID=9262771

 

Nymex gets $240 million equity offer

SAN FRANCISCO (MarketWatch) -- The New York Mercantile Exchange has received a $240 million bid for a 20% equity stake in the exchange from private-equity firm General Atlantic, according to a media report Wednesday.

http://www.marketwatch.com/news/story.asp?guid=%7B7AE43094-6B21-4988-BB6F-33CD40182938%7D&siteid=google

 

Vote set for Archipelago deal

http://chicagobusiness.com/cgi-bin/news.pl?id=17337

 

Cox should learn from his past

The lawyer solemnly told regulators it would be far too costly for a mutual fund to seek appraisals of its assets, and no appraisals were made. When employees of the investment firm suspected something was amiss, they were reassured when a government auditor pored over the books and concluded that all was well.  And so the fraud continued for more than a decade. It later turned out that the assets sold to investors were largely fictitious and that the supposed auditor, who presented credentials showing she worked for the California Department of Corporations, was in reality an actress hired by the man running the fraud.

The lawyer who argued that it would be a waste of money to require appraisals is about to be inundated with appeals to reduce the cost of regulation.  That lawyer was Christopher Cox, incoming chairman of the Securities and Exchange Commission. Cox did not know he was representing a crook at the time he wrote the letter. It was years later that William Edward Cooper, whose investment firm Cox was representing, pleaded guilty and was sentenced to 10 years in prison.

http://www.kansascity.com/mld/kansascity/business/12287410.htm

 

***** This was from July 29, but is a though provoking column by Floyd Norris of the New York Times.

 

SEC: Extension Of Compliance Date For Rule 612, The Sub-Penny Rule, Of Regulation NMS

http://www.exchange-handbook.co.uk/news_story.cfm?id=54291

 

Bermuda Stock Exchange Granted Designated Investment Exchange Status by the UK's Financial Services Authority

The Bermuda Stock Exchange is pleased to announce that it has been granted Designated Investment Exchange status by the UK Financial Services Authority with effect from 1 September 2005.

http://biz.yahoo.com/bw/050803/35200.html?.v=1

 

Grasso Opens the Door

In an exclusive interview, former New York Stock Exchange chief Richard Grasso tells NEWSWEEK what might entice him to make a deal with Attorney General Eliot Spitzer. Meanwhile, more details emerge on the NYSE-Archipelago merger.

http://www.msnbc.msn.com/id/8802059/site/newsweek/

 

Speed, efficiency, and convenience seen as the biggest drivers of growth

Electronic foreign exchange trading volume has doubled in each of the past two years, far outstripping overall FX trading volume growth, according to a new report from Greenwich Associates.

http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=29882&IdSection=2&cat=2

 

Treasury Says 30-Year Bond Is Coming Back

http://www.nytimes.com/aponline/business/AP-30-Year-Bond.html

 

U.S. to resume 30-year bond sales

Sales an attempt to add liquidity in long-term debt markets; first new issue due in early 2006.

http://money.cnn.com/2005/08/03/markets/bondcenter/thirty.reut/index.htm

 

THE U.S. WILL BRING BACK the 30-year Treasury bond next year, in a move that would help finance the national debt and should hold appeal for investors looking for a safe, longer-term investment option.  11:01 a.m.

http://online.wsj.com/article/0,,SB112307432544303739,00.html?mod=home_whats_news_us

 

***** Online WSJ subscription required.

 

Q&A: What the long bond's return means

http://online.wsj.com/article/0,,SB112307537962003760,00.html?mod=home_whats_news_us

 

***** Online WSJ subscription required.

 

Bond's Return to Yield Winners

Revival of 30-Year Treasury Sales Could Aid Security of Pensions, Profits of Traders and Investors

http://online.wsj.com/search#SB112299725637102651

 

***** Online WSJ subscription required.

 

Minutes Of The Meeting Of The Treasury Borrowing Advisory Committee Of The Bond Market Association August 2, 2005

The Committee convened in closed session at the Hay-Adams Hotel at 11:30 a.m. One member of the Committee, Ina Drew, was not present. Assistant Secretary for Financial Markets Timothy Bitsberger welcomed the Committee and gave them the charge.

http://www.ustreas.gov/press/releases/js2673.htm

 

U.S. 30-Year Treasuries Increase as Government Brings Back Bond Listen

U.S. Aug. 3 (Bloomberg) -- U.S. 30-year Treasuries rose after the government said that it will resume sales of the securities for the first time since 2001, providing a new benchmark for investors.

http://www.bloomberg.com/apps/news?pid=10000103&sid=aA0VfMk.WFb4

 

Electronic bond trading records high volumes on debut

MUMBAI: Screen-based trading in the bond market debuted with a bang. On the first full-fledged trading session, screen-based trading volumes were at Rs 800-900 crore, out of a gross market turnover of Rs 2,000 crore. The screen-based, order matching system may marginalise bond brokers, some of whom are exploring new business models.

http://economictimes.indiatimes.com/articleshow/1189488.cms

 

Environmental Trading News

 

Electrabel, Banco Santander and Climate Change Markets join IPE to trade ECX CFIs

There are now 40 Members enabled to trade in ECX CFI emissions contracts on the IPE. In addition, approximately 25 companies have direct access to the trading via one of the Clearing Members.

http://www.europeanclimateexchange.com/pages/page274.php

 

Bill Clinton On Bloomberg TV: Roberts, Climate Change, China, Iraq

NEW YORK, Aug. 3 /CNW/ -- In a one-on-one interview with Bloomberg Television(R), former United States President Bill Clinton spoke to Bloomberg News(R) Managing Editor Al Hunt about Supreme Court nominee Judge Roberts, climate change, China and the war in Iraq.

http://www.newswire.ca/en/releases/archive/August2005/03/c6607.html

 

EEX Half-Yearly Balance Sheet Is In The Black For The First Time – Introduction Of The Physical Future In France - Strong Growth In All Segments Confirms Arrangements For IT Integration And Product Enlargement – Revenues 30 Percent Above Last Year´S Period – Start Of Continuous Trading In CO2 Emission Allowances

http://www.exchange-handbook.co.uk/news_story.cfm?id=54300

 

Exchange & ECN News

 

CBOT Fed Watch - August 2 Market Close

In advance of this week's Federal Open Market Committee meeting on August 9, the Chicago Board of Trade will be reporting daily rate change probabilities in the FOMC's federal funds target rate, as indicated by the CBOT 30-Day Federal Funds futures contract.

http://www.cbot.com/cbot/pub/cont_detail/0,3206,991+23425,00.html

 

CBOT Strike Price Notice August 3, 2005

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1032+29724,00.html

 

NYBOT Announces Antwerp Coffee Warehouse Actions

http://www.nybot.com/releases/pressRelease.asp?releaseID=903

 

NYBOT Trading Volumes Continue Strong In July Year To Date, 12% Ahead Of Record 2004 Numbers

http://www.nybot.com/releases/pressRelease.asp?releaseID=902

 

“NYSE CEO AGENDA 2006” Defines Challenges and Opportunities Ahead for Global Leaders 1st Annual Survey of NYSE Listed-Company CEOs

http://www.nyse.com/press/1122979103009.html

 

NYSE Composite Index Sets New Closing High

http://www.nyse.com/press/1122979104595.html

 

Amex Lists Common Stock of National Lampoon Inc.

http://www.amex.com/atamex/news/press/sn_NLN_080205.htm

 

***** The funniest listing I have seen in a long time.

 

advent of last trading day for Options

http://www.ose.or.jp/e/news/0508/050803a.html

 

PROPOSED AMENDMENTS TO CDP RULES AND PROCEDURES

http://info.sgx.com/webnewscentre.nsf/bcb6f015b16e5258482569a7001af139/48256838002f07b148257052002c9348?OpenDocument

 

Russia's RTS launches stock index futures

MOSCOW, Aug 3 (Reuters) - Russia's RTS stock exchange launched trading in stock index futures on Wednesday, adding to its portfolio of futures and options on blue chip stocks.

http://asia.news.yahoo.com/050803/3/251w0.html

 

SYNTHESIS BANK ENTERS AGREEMENT WITH CHICAGO MERCANTILE EXCHANGE

Electrical Synthesis Bank, the Swiss leader in online investment banking, has entered into a marketing agreement with Chicago Mercantile Exchange (CME), the largest futures exchange in the United States with the broadest global distribution for trading futures electronically. This makes the electronic trading platform, Synthesis TradingFloor (www.tradingfloor.com), CME's only partner in

http://au.biz.yahoo.com/050803/17/6rof.html

 

NASDAQ Announces Market Statistics For The First Six Months Of 2005

http://www.exchange-handbook.co.uk/news_story.cfm?id=54303

 

American Stock Exchange Lists Merrill Lynch Strategic Return Notes Linked to the Industrial 15 Index

http://biz.yahoo.com/prnews/050803/nyw133.html?.v=19

 

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/dig080205.txt

 

CFTC Brings Fraud Charges Against Florida Father and Son, Alleging That Jack and Chris Smithers, and Their Company, Prosperity Consultants, Inc., Fraudulently Solicited Customers to Trade Commodity Futures Contracts

http://www.cftc.gov/opa/enf05/opa5104-05.htm

 

Extension of Compliance Date for Rule 612, the Sub-Penny Rule, of Regulation NMS

See also Final Rule, Release No. 34-52196

http://www.sec.gov/news/press/2005-106.htm

http://www.sec.gov/rules/final/34-52196.pdf

 

2005-105 Aug. 2, 2005 SEC Advisory Committee on Smaller Public Companies Solicits Public Input on Ways to Improve the Current Regulatory System for Smaller Companies

See also Release No. 33-8599; Request for Inp

http://www.sec.gov/news/press/2005-105.htm

http://www.sec.gov/rules/other/33-8599.pdf

http://www.sec.gov/cgi-bin/acspc-questions

 

CEOs spending more time on compliance, survey finds

Board members better informed as a result

http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=29876&IdSection=15&cat=15

 

Ontario improves investor protection

Legislation proclaimed implementing civil liability for secondary market disclosure

http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=29875&IdSection=8&cat=8

 

SEC bars broker in trading scheme Tue Aug 2, 2:53 PM ET

BOSTON (Reuters) - The U.S.     Securities and Exchange Commission on Tuesday said it barred a former Prudential Securities broker from the industry for orchestrating a scheme to mislead investors into buying shares of a local company.  The securities watchdog last year accused Chauncey Steele and six others of manipulating and inflating the stock price of Fairfield, Connecticut-based Competitive Technologies Inc.(AMEX:CTT - news).

http://news.yahoo.com/news?tmpl=story&u=/nm/20050802/bs_nm/financial_broker_dc_1

 

German regulator checking for insider trading at DaimlerChrysler

FRANKFURT, Germany -- Germany's financial services watchdog said Wednesday that it had opened a routine investigation into possible insider trading at DaimlerChrysler AG, focusing on dealing ahead of the announcement that CEO Juergen Schrempp was to retire.

http://www.detnews.com/2005/autosinsider/0508/03/01-268579.htm

 

Managed Futures - Managed Funds

 

S&P/TSX composite beats Dow, S&P 500 in July

Benchmark index up 12.7% so far this year

http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=29872&IdSection=15&cat=15

 

Hedge fund guide urges openness

The Managed Funds Association on Tuesday published its latest “sound practices” guide for hedge fund managers, including new recommendations on trading controls, risk management, disclosure to investors and the valuation of complex financial products.

http://news.ft.com/cms/s/2831d2f8-0374-11da-b54a-00000e2511c8.html

 

Hedge Funds Settle in Ritzy Suburb

If the hedge-fund boom has a capital, it is Greenwich, Conn., a ritzy suburb about 30 miles from Manhattan. More than 100 hedge funds, managing more than $100 billion, have set up shop here in the past few years.

http://online.wsj.com/article/0,,SB112303110400603336,00.html?mod=home%5Fpage%5Fone%5Fus

 

**** Online WSJ subscription required.

 

Hedge funds: No fear?

Amid talk of a hedge fund bubble, some say blowup fears may be exaggerated.

NEW YORK (CNN/Money) - Should Average Joe worry about what hedge funds are doing? Or just Millionaire Jane?

http://money.cnn.com/2005/08/01/markets/hedge_risk/

 

the group's protected fund of hedge funds offers return of 80% of highest value it reaches

Old Mutual is launching a protected fund of hedge funds offering an annual return of 4% above the Bank of England base rate.

http://www.trustnet.com/general/news/display-story.asp?id=70012&db=ifa

 

Fund Managers Raising the Ante in Philanthropy

By JENNY ANDERSON

The success of hedge funds is creating a new pool of rich donors worth tens of millions, even hundreds of millions.

http://www.nytimes.com/2005/08/03/business/03hedge.html

 

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

 

Cargill Sponsors Mayo Clinic's Nutrition in Health & Disease Course in Chicago

http://www.cargill.com/news/news_releases/050801_mayoclinic.htm#TopOfPage

 

Interim results

Patsystems' results for the six months ended 30 June 2005

http://www.patsystems.com/NewsEvents/index.cfm?fuseaction=NewsEvents&subaction=NewsArticle&fromSideMenu=true&id=126

 

Online Forex Training Reaches Hawaii

Over the last year, the latest day trading financial craze receiving a lot of media attention has been speculation in the $1.9 trillion -- day -- foreign exchange market, or Forex. So how do you go about getting started with countless online trading account companies pitching the same sales theme of quick gains on a small investment, much like the M.L.M. boom of the 80s?

http://biz.yahoo.com/prnews/050803/law030.html?.v=24

 

Producers watch bears and bulls tangle in pits

http://westernfarmpress.com/news/7-26-05-producers-watch-bears-bulls/

 

Call In The Super Heroes

Investment bankers need every special power and secret weapon they can lay their hands on to rebuild profitability and win the battle for market share.

http://www.institutionalinvestor.com/default.asp?page=1&SID=568190&ISS=18622&type=12

 

9/11 rescue workers plead for fund restoration

Rescue workers suffering from post-9/11 ailments and several local politicians called on Congress Tuesday to restore $125 million of proposed cuts to the workers' compensation fund.

"I'm embarrassed by the staggering lack of priorities in Washington," said U.S. Rep. Steve Israel (D-Huntington) at a news conference at the Central Islip Fire Department.

http://www.newsday.com/news/local/longisland/ny-liisra0803,0,4073762.story?coll=ny-top-headlines

 

Superderivatives® Scores Highly In 2005 Euromoney Financial Technology Poll

http://www.exchange-handbook.co.uk/news_story.cfm?id=54302

 

The irrepressible rise of the renminbi

By Fred Hu

Since China engineered a stunning change in the way it manages its currency, many people have expressed disappointment with the modest size of the renminbi's appreciation. But these critics have missed the crucial point: the renminbi is no longer a currency rigidly pegged against the dollar, but one whose value will move up and down in response to changing economic and market ­fundamentals.

http://news.ft.com/cms/s/5ead3ee8-03bb-11da-b54a-00000e2511c8.html

 

TradeStation Group Reports Monthly Business Metrics

TradeStation Group, Inc. today reported the following business metrics for July 2005:

http://biz.yahoo.com/prnews/050803/flw003.html?.v=22

 

John's Comments

 

Sign the petition and make a difference!  

Sign this petition. By doing so, you'll ensure that women who are diagnosed with breast cancer won't have to worry about being forced out of the hospital after undergoing a mastectomy! The Breast Cancer Patient Protection Act of 2005 will guarantee that women and their physicians, not insurance companies, will decide when they are ready to go home. So voice your support now — with your signature. Lifetime will deliver your signature, along with the millions of others, to Congress. Please add your name to the list to help get this legislation passed.

http://www.lifetimetv.com/reallife/bc/pledges/bc_mast_pledge.html

 

***** A CBOT member asked me to include this petition in the newsletter.  I signed the petition and encourage others to do likewise.

 

*******

 

Brent Crude Watch

 

IPE Brent Volume: 141,446

NYMEX Brent Crude Volume: 3014

NYMEX Percent of Total Volume: 2.09%

 

********

 

Chicago Electronic Trading Scorecard for August 3, 2004

 

Percent Electronic

 

CBOT: 63.15%

CME: 69.94%

CME Eurodollars: 78.43%

CME Live Cattle: 2.80%

CME Currency Products: 87.60%

CBOT Soybeans: 5.01%

 

CBOT Options: 11.12%

CME Options: 4.00%

 

Volume 

 

OneChicago Volume: 21,270

Eurex US Volume: 1906

Euronext.liffe Eurodollar Volume: 5293

CBOE Futures Exchange Volume: 447

 

Market Share

 

CBOT 100 oz. Gold Volume: 1322

NYMEX 100 oz. Gold Volume: 42,905

CBOT Share: 2.99%

 

CBOT 5000 oz. Silver Volume: 141

NYMEX 5000 oz. Silver Volume: 24,024

CBOT Share: .58%

 

CBOT Mini Gold Volume: 431

CBOT Mini Silver Volume: 410

 

Notes: OneChicago’s record setting open interest was 1,120,153 as of yesterday.  The open interest in the OneChicago Select Index A is now 2000 contracts. 

 

Liffe Eurodollar Over-Under

 

Liffe/Globex: .60%

Liffe/CME: .47%

 

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 jlothian@pricegroup.com johnlothian@johnlothian.com IM: LothianJohnJ http://www.pricegroupetd.com tel: tel2: fax: mobile: +1 312-264-4350 +1 800-713-0215 +1 312-264-4399 +1 312-203-5515

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Disclaimer: The John Lothian Newsletter is a product of John J. Lothian & Company, Inc.  The opinions expressed are strictly the opinion of John Lothian, and not necessarily those of his employer, The Price Group and its management, and is intended solely for informative purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed.  No guarantee of any kind is implied or possible where projections of future conditions are attempted.  Security futures are not suitable for all customers.

 

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