Crypto Finance Meets Regular Finance

What Is Forex Trading ? – A Definition & Introduction What is Forex? – The basics… Basically, the Forex market is where banks, businesses, governments, investors and traders come to exchange and speculate on currencies. The Forex market is also referred to as the ‘Fx market’, ‘Currency market’, ‘Foreign exchange currency market’ or ‘Foreign currency market’, and it is the largest and most liquid market in the world with an average daily turnover of $3.98 trillion. The Fx market is open 24 hours a day, 5 days a week with the most important world trading centers being located in London, New York, Tokyo, Zurich, Frankfurt, Hong Kong, Singapore, Paris, and Sydney. It should be noted that there is no central marketplace for the Forex market; trading is instead said to be conducted ‘over the counter’; it’s not like stocks where there is a central marketplace with all orders processed like the NYSE. Forex is a product quoted by all the major banks, and not all banks will have the exact same price. Now, the broker platforms take all theses feeds from the different banks and the quotes we see from our broker are an approximate average of them. It’s the broker who is effectively transacting the trade and taking the other side of it…they ‘make the market’ for you. When you buy a currency pair…your broker is selling it to you, not ‘another trader’. • A brief history of the Forex market Ok, I admit, this part is going to be a little bit boring, but it’s important to have some basic background knowledge of the history of the Forex market so that you know a little bit about why it exists and how it got here. So here is the history of the Forex market in a nutshell: In 1876, something called the gold exchange standard was implemented. Basically it said that all paper currency had to be backed by solid gold; the idea here was to stabilize world currencies by pegging them to the price of gold. It was a good idea in theory, but in reality it created boom-bust patterns which ultimately led to the demise of the gold standard. The gold standard was dropped around the beginning of World War 2 as major European countries did not have enough gold to support all the currency they were printing to pay for large military projects. Although the gold standard was ultimately dropped, the precious metal never lost its spot as the ultimate form of monetary value. The world then decided to have fixed exchange rates that resulted in the U.S. dollar being the primary reserve currency and that it would be the only currency backed by gold, this is known as the ‘Bretton Woods System’ and it happened in 1944 (I know you super excited to know that). In 1971 the U.S. declared that it would no longer exchange gold for U.S. dollars that were held in foreign reserves, this marked the end of the Bretton Woods System. It was this break down of the Bretton Woods System that ultimately led to the mostly global acceptance of floating foreign exchange rates in 1976. This was effectively the “birth” of the current foreign currency exchange market, although it did not become widely electronically traded until about the mid 1990s. (OK! Now let’s move on to some more entertaining topics!)… What is Forex Trading? Forex trading as it relates to retail traders (like you and I) is the speculation on the price of one currency against another. For example, if you think the euro is going to rise against the U.S. dollar, you can buy the EURUSD currency pair low and then (hopefully) sell it at a higher price to make a profit. Of course, if you buy the euro against the dollar (EURUSD), and the U.S. dollar strengthens, you will then be in a losing position. So, it’s important to be aware of the risk involved in trading Forex, and not only the reward. • Why is the Forex market so popular? Being a Forex trader offers the most amazing potential lifestyle of any profession in the world. It’s not easy to get there, but if you are determined and disciplined, you can make it happen. Here’s a quick list of skills you will need to reach your goals in the Forex market: Ability – to take a loss without becoming emotional Confidence – to believe in yourself and your trading strategy, and to have no fear Dedication – to becoming the best Forex trader you can be Discipline – to remain calm and unemotional in a realm of constant temptation (the market) Flexibility – to trade changing market conditions successfully Focus – to stay concentrated on your trading plan and to not stray off course Logic – to look at the market from an objective and straight forward perspective Organization – to forge and reinforce positive trading habits Patience – to wait for only the highest-probability trading strategies according to your plan Realism – to not think you are going to get rich quick and understand the reality of the market and trading Savvy – to take advantage of your trading edge when it arises and be aware of what is happening in the market at all times Self-control – to not over-trade and over-leverage your trading account As traders, we can take advantage of the high leverage and volatility of the Forex market by learning and mastering and effective Forex trading strategy, building an effective trading plan around that strategy, and following it with ice-cold discipline. Money management is key here; leverage is a double-edged sword and can make you a lot of money fast or lose you a lot of money fast. The key to money management in Forex trading is to always know the exact dollar amount you have at risk before entering a trade and be TOTALLY OK with losing that amount of money, because any one trade could be a loser. More on money management later in the course. • Who trades Forex and why? Banks – The interbank market allows for both the majority of commercial Forex transactions and large amounts of speculative trading each day. Some large banks will trade billions of dollars, daily. Sometimes this trading is done on behalf of customers, however much is done by proprietary traders who are trading for the bank’s own account. Companies – Companies need to use the foreign exchange market to pay for goods and services from foreign countries and also to sell goods or services in foreign countries. An important part of the daily Forex market activity comes from companies looking to exchange currency in order to transact in other countries. Governments / Central banks – A country’s central bank can play an important role in the foreign exchange markets. They can cause an increase or decrease in the value of their nation’s currency by trying to control money supply, inflation, and (or) interest rates. They can use their substantial foreign exchange reserves to try and stabilize the market. Hedge funds – Somewhere around 70 to 90% of all foreign exchange transactions are speculative in nature. This means, the person or institutions that bought or sold the currency has no plan of actually taking delivery of the currency; instead, the transaction was executed with sole intention of speculating on the price movement of that particular currency. Retail speculators (you and I) are small cheese compared to the big hedge funds that control and speculate with billions of dollars of equity each day in the currency markets. Individuals – If you have ever traveled to a different country and exchanged your money into a different currency at the airport or bank, you have already participated in the foreign currency exchange market. Investors – Investment firms who manage large portfolios for their clients use the Fx market to facilitate transactions in foreign securities. For example, an investment manager controlling an international equity portfolio needs to use the Forex market to purchase and sell several currency pairs in order to pay for foreign securities they want to purchase. Retail Forex traders – Finally, we come to retail Forex traders (you and I). The retail Forex trading industry is growing everyday with the advent of Forex trading platforms and their ease of accessibility on the internet. Retail Forex traders access the market indirectly either through a broker or a bank. There are two main types of retail Forex brokers that provide us with the ability to speculate on the currency market: brokers and dealers. Brokers work as an agent for the trader by trying to find the best price in the market and executing on behalf of the customer. For this, they charge a commission on top of the price obtained in the market. Dealers are also called market makers because they ‘make the market’ for the trader and act as the counter-party to their transactions, they quote a price they are willing to deal at and are compensated through the spread, which is the difference between the buy and sell price (more on this later). Advantages of Trading the Forex Market: • Forex is the largest market in the world, with daily volumes exceeding $3 trillion per day. This means dense liquidity which makes it easy to get in and out of positions. • Trade whenever you want: There is no opening bell in the Forex market. You can enter or exit a trade whenever you want from Sunday around 5pm EST to Friday around 4pm EST. • Ease of access: You can fund your trading account with as little as $250 at many retail brokers and begin trading the same day in some cases. Straight through order execution allows you to trade at the click of a mouse. • Fewer currency pairs to focus on, instead of getting lost trying to analyze thousands of stocks • Freedom to trade anywhere in the world with the only requirements being a laptop and internet connection. • Commission-free trading with many retail market-makers and overall lower transaction costs than stocks and commodities. • Volatility allows traders to profit in any market condition and provides for high-probability weekly trading opportunities. Also, there is no structural market bias like the long bias of the stock market, so traders have equal opportunity to profit in rising or falling markets. While the forex market is clearly a great market to trade, I would note to all beginners that trading carries both the potential for reward and risk. Many people come into the markets thinking only about the reward and ignoring the risks involved, this is the fastest way to lose all of your trading account money. If you want to get started trading the Fx market on the right track, it’s critical that you are aware of and accept the fact that you could lose on any given trade you take. Forex Trading Terminology The Forex market comes with its very own set of terms and jargon. So, before you go any deeper into learning how to trade the Fx market, it’s important you understand some of the basic Forex terminology that you will encounter on your trading journey… • Basic Forex terms: Cross rate – The currency exchange rate between two currencies, both of which are not the official currencies of the country in which the exchange rate quote is given in. This phrase is also sometimes used to refer to currency quotes which do not involve the U.S. dollar, regardless of which country the quote is provided in. For example, if an exchange rate between the British pound and the Japanese yen was quoted in an American newspaper, this would be considered a cross rate in this context, because neither the pound or the yen is the standard currency of the U.S. However, if the exchange rate between the pound and the U.S. dollar were quoted in that same newspaper, it would not be considered a cross rate because the quote involves the U.S. official currency. Exchange Rate – The value of one currency expressed in terms of another. For example, if EUR/USD is 1.3200, 1 Euro is worth US$1.3200. Pip – The smallest increment of price movement a currency can make. Also called point or points. For example, 1 pip for the EUR/USD = 0.0001 and 1 pip for the USD/JPY = 0.01. Leverage – Leverage is the ability to gear your account into a position greater than your total account margin. For instance, if a trader has $1,000 of margin in his account and he opens a $100,000 position, he leverages his account by 100 times, or 100:1. If he opens a $200,000 position with $1,000 of margin in his account, his leverage is 200 times, or 200:1. Increasing your leverage magnifies both gains and losses. To calculate the leverage used, divide the total value of your open positions by the total margin balance in your account. For example, if you have $10,000 of margin in your account and you open one standard lot of USD/JPY (100,000 units of the base currency) for $100,000, your leverage ratio is 10:1 ($100,000 / $10,000). If you open one standard lot of EUR/USD for $150,000 (100,000 x EURUSD 1.5000) your leverage ratio is 15:1 ($150,000 / $10,000). Margin – The deposit required to open or maintain a position. Margin can be either “free” or “used”. Used margin is that amount which is being used to maintain an open position, whereas free margin is the amount available to open new positions. With a $1,000 margin balance in your account and a 1% margin requirement to open a position, you can buy or sell a position worth up to a notional $100,000. This allows a trader to leverage his account by up to 100 times or a leverage ratio of 100:1. If a trader’s account falls below the minimum amount required to maintain an open position, he will receive a “margin call” requiring him to either add more money into his or her account or to close the open position. Most brokers will automatically close a trade when the margin balance falls below the amount required to keep it open. The amount required to maintain an open position is dependent on the broker and could be 50% of the original margin required to open the trade. Spread – The difference between the sell quote and the buy quote or the bid and offer price. For example, if EUR/USD quotes read 1.3200/03, the spread is the difference between 1.3200 and 1.3203, or 3 pips. In order to break even on a trade, a position must move in the direction of the trade by an amount equal to the spread. • The major Forex pairs and their nicknames: • Understanding Forex currency pair quotes: You will need to understand how to properly read a currency pair quote before you start trading them. So, let’s get started with this: The exchange rate of two currencies is quoted in a pair, such as the EURUSD or the USDJPY. The reason for this is because in any foreign exchange transaction you are simultaneously buying one currency and selling another. If you were to buy the EURUSD and the euro strengthened against the dollar, you would then be in a profitable trade. Here’s an example of a Forex quote for the euro vs. the U.S. dollar: The first currency in the pair that is located to the left of the slash mark is called the base currency, and the second currency of the pair that’s located to the right of the slash market is called the counter or quote currency. If you buy the EUR/USD (or any other currency pair), the exchange rate tells you how much you need to pay in terms of the quote currency to buy one unit of the base currency. In other words, in the example above, you have to pay 1.32105 U.S. dollars to buy 1 euro. If you sell the EUR/USD (or any other currency pair), the exchange rate tells you how much of the quote currency you receive for selling one unit of the base currency. In other words, in the example above, you will receive 1.32105 U.S. dollars if you sell 1 euro. An easy way to think about it is like this: the BASE currency is the BASIS for the trade. So, if you buy the EURUSD you are buying euro’s (base currency) and selling dollars (quote currency), if you sell the EURUSD you are selling euro’s (base currency) and buying dollars (quote currency). So, whether you buy or sell a currency pair, it is always based upon the first currency in the pair; the base currency. The basic point of Forex trading is to buy a currency pair if you think its base currency will appreciate (increase in value) relative to the quote currency. If you think the base currency will depreciate (lose value) relative to the quote currency you would sell the pair. • Bid and Ask price Bid Price – The bid is the price at which the market (or your broker) will buy a specific currency pair from you. Thus, at the bid price, a trader can sell the base currency to their broker. Ask Price – The ask price is the price at which the market (or your broker) will sell a specific currency pair to you. Thus, at the ask price you can buy the base currency from your broker. Forex trading is everything.

Yesterday I casually suggested that the ideal thing to turn into a smart contract on the blockchain is an interest-rate swap: It's just a series of exchanges of money, with no need to do anything in the real world, so it is easy to encode in computer instructions. But one reader correctly objected that the real meat of an interest-rate swap as a contract is its credit terms. An interest-rate swap is an unfunded way to get interest-rate exposure. Instead of putting up $1,000 to buy a bond and getting back 2.5 percent interest every year, I sort of pretend that I did that: You give me 2.5 percent of $1,000 every year, and in exchange I give you whatever Libor is that year. But neither of us ever puts up the $1,000.

That means that if interest rates move sharply against me -- if Libor goes to 10 percent -- then I have to come up with $100 each year, and you have to trust that I'm good for it. And that trust usually comes in the form of credit support annexes and collateral posting and the possibility of suing me and so forth, a whole apparatus that lets market participants trust that their counterparties will pay them in the future. Turning that into a smart contract is harder: The smart contract could theoretically be required to pull any arbitrary amount of money from my computer and send it to your computer, and the only way to guarantee that it will be able to do that is to lock up a lot of my money for the whole length of the contract. Everything has to be fully collateralized in order to automate it with perfect reliability. And so unfunded exposures -- bets where I may have to pay you later and you may have to pay me later but neither of us pays now -- are harder to put into smart contracts on the blockchain.

This is in some sense not a bug but a feature; many cryptocurrency enthusiasts like Bitcoin precisely because it limits fractional-reserve banking and excessive leverage and other evils of the traditional financial system. But outside of crypto, much of the work of finance is about finding new ways to take on leverage. And so when you introduce finance people to cryptocurrencies, their first reaction is often "well this is neat, lots of volatility, computers, I can work with this," but their second reaction is often "wait but we need to find a way to borrow this thing."

Anyway here's a story about a former Goldman Sachs and Merrill Lynch structurer who "plans to launch a platform for digital currencies later in 2018 that will allow private or institutional investors to strike so-called repurchase agreements or repos with one another":

Holders of a cryptocurrency—institutions or private individuals—will earn money from lending it out via the Oxygen platform. In return they get another cryptocurrency, which they agree to take as collateral until their original currency is returned. Borrowers get access to a cryptocurrency they want to use or trade short-term. That could allow them to trade it or use it for transactions.

Of course some Bitcoin exchanges already allow for lending and shorting. The point is that this is a feature that people want; it is also a feature that is not built into the Bitcoin blockchain. The core feature of Bitcoin -- the technological problem that Satoshi Nakamoto set out to solve -- is that you can't spend Bitcoins that you don't have. The core feature of finance -- the technological problem that bankers have set out to solve for millennia -- is that you can spend money that you don't have. That's what finance is; it's the business of moving money from the people with the money to the people with productive uses for other people's money. There is an obvious tension.

Elsewhere in tensions between blockchains and finance, here's a story about the Lightning Network, a bid to ease congestion on the Bitcoin blockchain by basically deferring settlement of Bitcoin transactions:

In this system, two parties open a channel and commit funds to it. The opening of a channel gets broadcast to the blockchain and incurs the normal bitcoin transaction fee. The channel can stay open for however long—say, a month—during which time the two users can exchange as many payments as they like for free. When the time expires, the channel closes and broadcasts the final state of the pair’s transactions to the blockchain, incurring another transaction fee.

A lot of what I read about the blockchain for finance involves speeding up settlement time. If you trade stocks or syndicated loans or whatever on the blockchain, people argue, you can have instantaneous settlement instead of waiting days or weeks for your transactions to clear. Meanwhile a lot of people who actually trade stocks or loans or whatever are skeptical of that goal: Gaps between trade and settlement are not just technological failures; you need that time to line up funding or stock borrow or permissions or whatever. It turns out that even trading Bitcoin on the Bitcoin blockchain might work better with a one-month settlement delay. Again and again, the messy reality of the traditional financial system keeps intruding on the crystalline purity of the blockchain.

Elsewhere, here is a headline saying "Davos: Blockchain can no longer be ignored," and imagine ignoring blockchain. I am imagining it right now and it is a lovely feeling. I should point out that the World Economic Forum was writing breathless love letters to the blockchain back in 2016; "let's not ignore blockchain" is among the most Davos-y sentiments I can think of.

And last week Venezuela sort of released the white paper for its cryptocurrency? It is called the "petro," and we have made fun of it before, but even by the standards of joke-cryptocurrency white papers Venezuela's is a poor effort. Tonally it is is more of a "manifesto" than a "white paper," though I suppose that is true of a lot of cryptocurrencies. Monica de Bolle and Martin Chorzempa of the Peterson Institute are unimpressed: "It combines serious misunderstandings with wishful thinking about the benefits of blockchain technology, along with evidence that the government is either trying to fool its populace or that it does not understand the basics of cryptocurrencies, or both." The U.S. Treasury is also unimpressed: Its sanctions FAQ (item 551) notes that the petro "would appear to be an extension of credit to the Venezuelan government," and that people who buy it "may be exposed to U.S. sanctions risk."

And here's a good reason for banks to be wary of Bitcoin:

UBS Group AG Chairman Axel Weber said the Swiss bank won’t trade Bitcoin or offer it to retail clients as increased regulation could lead to a “massive” drop in value.

“This is something where the price is really unclear," Weber said in an interview Wednesday with Bloomberg TV at the World Economic Forum in Davos, Switzerland. “We fear that in the future if these investments implode and the market corrects, then investors will be looking at ‘who sold us this?’"

If some dude on the internet sells you a hugely volatile asset with no intrinsic value and it immediately loses 50 percent of its value, you're like "well played, dude on the internet." If a bank does it, though, you sue.

And 50 Cent is a bitcoin millionaire.

Corporate governance.

There is an extensive literature in finance about how companies should motivate their managers to act in shareholders' best interests, minimize conflicts, discourage shirking, and so forth. Often this literature assumes a sort of idealized homo economicus chief executive officer, one who has a certain set of recognizable human characteristics (some desire for money, power and/or leisure) but who is not necessarily a fully fleshed out person. For instance, the literature rarely considers the CEO's blood pressure or cholesterol levels or family medical history. And yet, as a public company, having a CEO who is alive is perhaps even more important than having one with properly aligned incentives. As CSX has concluded:

CSX Corp. will require the railroad’s chief executive to submit to an annual physical exam that will be reviewed by the board, adopting an unusually aggressive approach to a delicate issue just weeks after the death of its previous CEO.

The railroad’s board was under fire last year after it agreed to hire Hunter Harrison even though he declined to get a physical exam or provide access to his medical records— despite concerns about the then 72-year-old railroad veteran’s health.

It is an unusually stark case of barn-door-closing; really the time to give your CEO a physical is before you hire one who dies in office. But this is not the sort of thing you think about until you have to.

Elsewhere in governance, Bloomberg News reports that Elon "Musk's New Pay Deal Could Make Him the World's Richest Man—If Tesla Succeeds":

If the award fully vests, Musk would own a 28 percent stake in the company worth about $184 billion, vaulting him to the top of the Bloomberg Billionaires Index. Amazon’s Jeff Bezos currently sits atop the index with a $111.5 billion net worth as of Monday’s close in New York. Musk’s stake in SpaceX constitutes about half of his current net worth of $21.5 billion.

Sure yes but look. We talked about this yesterday. If the award just didn't exist -- if Tesla Inc.'s board was just like "you know what, this guy is rich and motivated enough," and decided that his compensation for being CEO would be zero forever -- then Musk would also be the world's richest person at a $650 billion valuation. He currently owns 21.9 percent of Tesla. If Tesla were worth $650 billion -- it's currently worth about $60 billion -- then that 21.9 percent stake would be worth about $142 billion. If Tesla's market cap grows tenfold while Amazon's doesn't move, then Elon Musk will be the richest person in the world, because that is a lot of growth and he owns a lot of Tesla stock. This has very little to do with his compensation plan and very much to do with the fact that if you own billions of dollars of stock and it goes up by 1,000 percent then you will be super duper rich.

Still elsewhere in corporate governance, Twitter Inc. CEO Jack Dorsey and departing Chief Operating Officer Anthony Noto have different management styles:

During Twitter’s frequent company-wide discussions called "Tea Time," Noto rallied employees around pep talks that explained the strategies the company was pursuing, like live video, and often punctuated his company memos with the two-exclamation-point emoji. Dorsey tended to give more abstract speeches that were sometimes personal stories about the founding of Twitter, his own reflections or his vision for the product, according to one of the people.

I guess Dorsey's approach sounds more like "Tea Time," though maybe Noto's is more like management. Anyway Noto is leaving Twitter to become CEO of Social Finance, the online lender whose mission just a couple of years ago was to "kill banks." Now it will be run by a former Goldman Sachs Group Inc. banker. The banks do not want to be killed, and they play a long game.

Never trust the water-skiing instructor.

I am sure that Jimmy Levin is really good at making investment decisions but I giggle every time I am reminded of how he got his start at Daniel Och's hedge fund:

In the late 1990s, Mr. Levin was working at a summer camp in Wisconsin, teaching Mr. Och’s son how to water ski. By last year, the younger man was in line to succeed Mr. Och as chief executive of Och-Ziff Capital Management LLC, the largest publicly traded hedge fund in the U.S. with $33 billion in assets under management. To entice him to stick around, Mr. Och handed Mr. Levin, who is 34 years old and goes by Jimmy, nearly $300 million in cash and Och-Ziff stock.

There is a popular notion that hedge funds are for brilliant iconoclasts who don't fit in with the politics at investment banks, but that is not the whole story. The other side of it is that you have to get along personally with the brilliant iconoclast running your hedge fund if you want to do well there. At a small place without an institutionalized human resources function, the politics can be more important than they are at a big corporate place. They're just weirder and more idiosyncratic politics. Instructing the right kid in the right water-skiing moves at the right time could make your career.

Anyway Levin is now out of favor, Och has "reasserted control," and the knives are out:

Interviews with more than a dozen people close to the situation at Och-Ziff suggest that many inside the firm, including board members and Mr. Levin, were shocked by the shift. People familiar with Mr. Och’s thinking say he felt Mr. Levin pushed too far, too fast, asking for more money and control than he was due.

Being the protege of a big hedge-fund manager can take you a long way, but you run the risk that he will change his mind.

Leaks.

Recently Snap Inc. sent a somewhat ill-tempered memo to employees telling them not to leak Snap's secrets:

If you leak Snap Inc. information, you will lose your job and we will pursue any and all legal remedies against you. And that’s just the start. You can face personal financial liability even if you yourself did not benefit from the leaked information. The government, our investors, and other third parties can also seek their own remedies against you for what you disclosed. The government can even put you in jail.

A lot of tech and business reporters -- whose job, after all, is to get corporate employees to leak their companies' secrets -- found this objectionable, and objected. "Snap Threatens Jail Time for Leakers," was Cheddar's headline reporting the memo. "Leaked Snap Memo Says Employees Could Go to Jail If They . . . Leak Memos," pointed out Yahoo Finance.

Can you really go to jail for leaking corporate secrets? Yes, of course, come on. We talk about it all the time. It is called "insider trading": If you have some Snap secrets, and you tell them to your golf buddy, and you expect him to trade on that information, and he does trade on that information, then you are at least probably guilty of insider trading. (That is not legal advice, and if we had more time we could talk a lot about the "personal benefit test," but it's good enough.) That seems to be what Snap's general counsel is getting at, with the "even if you yourself did not benefit" stuff. Even beyond insider trading there are other ways to go to jail for leaking secret corporate information. Poor former Sergey Aleynikov was arrested twice for allegedly improperly copying Goldman Sachs Group Inc.'s secret computer code, and there is apparently an active criminal investigation into the apparent leak of Waymo's self-driving-car trade secrets to Uber Technologies Inc. People definitely get arrested for leaking corporate secrets, what a silly question.

On the other hand, can you really go to jail for leaking corporate secrets to journalists? I am going to say no, though this is especially not legal advice, and you should consider my conflicts of interest. (Go ahead, leak corporate secrets to me, whatever.) To be fair I do not read Snap's memo to say otherwise: It says that some sorts of leaks could land you in jail, but it doesn't come out and say that leaks to reporters are in that category. Perhaps it does subtly conflate the issues as a tactical choice. Some journalists, who have even more guild loyalty than I do, got very up in arms about the Snap memo, arguing that it is illegal for companies even to fire employees for leaking to the media. This seems ... untrue? There is some authority that broad prohibitions on talking to the media violate the National Labor Relations Act because they might chill employees "from discussing labor disputes, wages, or other terms and conditions of their employment," but Snap's policy prohibits only leaking confidential information, and it seems bizarre to imagine that there's a magical provision of federal law that prohibits companies from keeping their secret financial and operating information secret.

Suing Wall Street.

If you are a service provider -- a law firm, say -- then big banks are attractive clients. They are big, their affairs are complex, they provide steady work, they pay their bills on time. If they want to hire you, you say yes. But here is a Bloomberg Big Law Business profile of Quinn Emmanuel, a big -- and very profitable -- law firm that said no to the banks:

The decision arose after client conflicts prevented the firm from handling some work in the Parmalat matter because it represented banks, which prompted a review of Quinn Emanuel’s business, Carlinsky said.

“The epiphany was: we’ve got this backwards,” he said. “We need to get rid of our bank clients.”

The banks provide steady legal work, sure, but the epiphany was that they provide steady work to both sides. And suing them can be even more lucrative than defending them.

Me yesterday.

I wrote about accountants and the regulatory revolving door.

Things happen.


Men Only: Inside the charity fundraiser where hostesses are put on show. A Wall Street Ally Is Leading the Charge to Roll Back the Volcker Rule. Senate Confirms Jerome Powell as Federal Reserve Chairman. Mnuchin Endorses Weaker Dollar, Sharpening Trade War Rhetoric. State Tax Workarounds Could Mean $154 Billion Lost to Treasury. Qualcomm Gets $1.2 Billion EU Fine for Apple Chip Payments. CFPB Chief Mulvaney Says Days of ‘Pushing the Envelope’ Are Over. Comparability of Basel risk weights in the EU banking sector is questionable. Matt Hurd reminisces about HFT ("A good thing about my prior firm is they did fire people for making money."). Elie Mystal reminisces about his law-school loans. Claw machine cat

sumber:https://www.bloomberg.com/view/articles/2018-01-24/crypto-finance-meets-regular-finance

HALAMAN SELANJUTNYA:

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