Baltic Dry Index. 1114 -09 Brent Crude 62.80
“October:
This is one of the peculiarly dangerous months to speculate in stocks. The
others are July, January, September, April, November, May, March, June,
December, August and February.”
Mark Twain.
Ash Wednesday and the
start of Lent. St Valentine’s Day. The 89th anniversary of Chicago’s St Valentine’s Day, massacre, will it repeat today at the VIX? The eve of the Lunar New
Year. What could possibly go wrong?
We open with another “Liebor”
scandal brewing, this time in Chicago and the Volatility Index. Has the
Commodity Futures Trading Commission been asleep at the switch, or deliberately,
for some reason or other, looking the other way? They wouldn’t do that, would
they?
Below, Cboe’s VIX
comes in for big scrutiny on VIX Wednesday. But will it over shadow today’s US
inflation figures? With all the world now watching, will the riggers be forced
into not rigging today’s VIX close? How will that play in the wobbly markets?
"Anyone engaging in illegal financial
transactions will be caught and persecuted."
George W. Bush, Washington, D.C., Sept. 19,
2008
How Wall Street’s ‘fear gauge’ is being rigged, according to one whistleblower
Published: Feb 13, 2018 11:07 p.m. ET
Cboe says whistleblower letter is filled with ‘inaccurate statements’
One of the most popular measures of volatility is being manipulated, charges one individual who submitted a letter anonymously to the Securities and Exchange Commission and the Commodity Futures Trading Commission.The letter makes the claim to regulators that fake quotes for the S&P 500 index SPX, +0.26% are skewing levels of the Cboe Volatility Index VIX, -2.50% which reflects bearish and bullish options bets 30-days in the future on the S&P 500 to gauge implied stock-market volatility (see excerpt from the letter below).
The flaw allows trading firms with sophisticated algorithms to move the VIX up or down by simply posting quotes on S&P options and without needing to physically engage in any trading or deploying any capital. This market manipulation has led to multiple billions in profits effectively taken away from institutional and retail investors and cashed in by unethical electronic option market makers. |
The whistleblower’s claims are consistent with those documented by John Griffin, professor of finance at the University of Texas and Ph.D. candidate Amin Shams in May 2017 in research that says the cost of manipulating less-liquid SPX options would be more than paid for by a successful bet on the direction of the VIX. The paper is consistent with the whistleblower’s conclusion—that manipulators are moving prices of the SPX options by spoofing at settlement—entering quotes for trades that are never executed—to “paint the tape” and, therefore, influence the value of expiring VIX derivatives.
Opinion: How S&P 500 options may be used to manipulate VIX ‘fear gauge’
The VIX has underpinned a number of strategies described as so-called short-volatility, which imploded dramatically last Monday when VIX, also known as Wall Street’s fear gauge, registered its largest percentage change in its history, cratering bets that volatility measures would fall, if not remain muted.
Short volatility products, notably, VelocityShares Daily Inverse VIX Short Term ETN XIV, -0.75% tumbled 90% in after-hours trade Feb. 5 as the Dow Jones Industrial Averaged DJIA, +0.16% plunged 1,175 points, or 4.6%, marking its sharpest point drop in the blue-chip gauge’s 121-year history. Another product, the exchange-traded fund ProShares Short VIX Short-Term Futures ETF SVXY, -0.44% known by its ticker SVXY, also tanked last week.
Credit Suisse, the sponsor, of VelocityShares Daily, or XIV, said it planned to liquidate the product on Feb. 21.
----Jason Zuckerman, attorney at law firm, Zuckerman Law, who is representing the anonymous whistleblower, told MarketWatch that his client is concerned about unfair markets.
“My client is concerned about VIX manipulation that has already caused
investors to incur massive losses and is eager to prevent further harm from
investors,” Zuckerman said.
The whistleblower would also like the market regulates to play a more
active role in preventing further harm to investors including requiring more
accurate and comprehensive disclosures about the various risks that are
associated with products linked to VIX,” he said.
The letter urges “the SEC and CFTC to promptly investigate the matter
before investors suffer additional losses due to this fraud.”
More
Why Wednesday Could Be a Huge Day for the VIX
By Gregory Calderone
Tomorrow’s VIX options expiration could prove extra volatile for the
gauge.
The Cboe Volatility Index tends to have bigger swings on days its
contracts mature, with intraday moves of 13 percent on average on the past 12
monthly expirations. That compares with a mean daily fluctuation of 10 percent
in the year through January. Of course, that was before this month, when a
record VIX surge on Feb. 5 sent its average intraday move for February to
almost 60 percent.
What’s more, the recent market turmoil has led to a surge in the number
of VIX contracts, and put open interest almost tripled to a record since the
Jan. 17 expiration. Counting puts and calls, there are 15.4 million VIX options
outstanding, and 40 percent of them mature tomorrow.
While most stock-index options expire on the third Friday of every
month, monthly VIX contracts expire two days earlier, on the Wednesday.
February 14, 2018 / 4:02 AM /
Updated 2 hours ago
SE Asia Stocks-Cautious as investors await U.S. inflation data; Philippines drops
* Philippines weakest market in region
* Most markets subdued, Vietnam closed for holiday
By Christina Martin
Feb 14 (Reuters) - Most Southeast Asian stock markets traded
on a cautious note on Wednesday, mirroring broader Asia as
investors awaited a U.S. inflation report that could hold clues
on rate hike movements globally.
Investors said the U.S. consumer price readings due later in
the day will be key to where stocks move in the short term,
given it was the risk of accelerating inflation that sparked the
recent global equity rout.
MSCI's broadest index of Asia-Pacific shares outside Japan
rose 0.4 percent.
"The markets are on tenterhooks awaiting tonight's critical
U.S. CPI data. Last week, the market took the uptick in
inflation very poorly," said Stephen Innes, head of trading for
Asia Pacific at Oanda.
"Will we see a reply to last week's tumult if inflation
rears its ugly head? An inflation scare could push Treasury
yields much higher and send equities spiralling lower."
More
February 14, 2018 / 4:52 AM
China stocks dip ahead of Lunar New Year, Hong Kong rises
SHANGHAI, Feb 14 (Reuters) - China stocks dipped on Wednesday morning, with
investors cutting risk exposure on the last trading day before the week-long
Lunar New Year holiday while Hong Kong shares extended their rebound.
** China’s stock market will be closed Feb 15-Feb 21 due to the holiday.
Hong Kong shares will halt trading on Thursday afternoon, and will resume
trading next Tuesday, Feb 20.
** At 04:11 GMT, the Shanghai Composite index was down 9.64 points or
0.3 percent at 3,175.32.
** China’s blue-chip CSI300 index was down 0.06
percent, with its financial sector sub-index lower by 0.58 percent, the
consumer staples sector up 0.65 percent, the real estate index down 1.02
percent and healthcare sub-index up 0.57 percent. ** Chinese H-shares listed in
Hong Kong rose 0.54 percent to 12,069.12 while the Hang Seng Index was up 0.77
percent at 30,068.56. ** The smaller Shenzhen index was down 0.17 percent and
the start-up board ChiNext Composite index was weaker by 0.72 percent.
More
February 14, 2018 / 2:46 AM
Japanese shares give up early gains, Nikkei hits 4-month low
TOKYO, Feb 14 (Reuters) - Japan’s Nikkei share average
failed to maintain early gains on Wednesday, and hit a four-month low as
investor sentiment remained shaky ahead of U.S. inflation data due later in the
day.
Nikkei average initially tracked gains on Wall Street shares
to rise 0.6 percent but it quickly lost steam, dropping as much as 0.9 percent
to 21,061.85 in morning trade, below last week’s low of 21,078.71.
At the midday break, the Nikkei was at 21,109.29, off 0.64 percent for
the day.
While the Nikkei’s 200-day moving average, which stood around 21,000, is
seen as a major support, a break of that level could worsen the battered
sentiment, a real possibility if U.S. January inflation data triggers another
rout in global shares.
The broader Topix dropped 0.7 percent to 1,704.47, slipping to its
lowest levels since October, with small cap shares hit the most. The Topix
Small dropped 1.2 percent.
Selling was broad-based, with about three-quarters of about 2,000 shares
listed on the Tokyo Stock Exchange’s main board in the red while only about
one-fifth made gains.
More
Finally, blame it on
global warming, Brexit and Trump.
Suddenly planet Earth seems to have glut of snow. Just don’t tell the extreme left wing, anti-America, anti-British, anti-Christian,
anti-Israel, anti-Trump, pro-moslem, pro-lgbt, pro-Comrade Corbyn, pro-Clinton,
pro-global warming, degenerate, trougher’s paradise of the BBC.
North wind blow, we shall have snow
Old English Winter Weather Saying.
Record snowfall amounts pile up around the globe
Record
snowfall in Windsor, Ontario – February 11, 2018 – A record 18.4 cm of snow fell
on Windsor on Friday, according to Environment Canada. Read more
10 Feb 2018 – Snowfall on a good
part of Spain. Read more
Michigan city’s snowfall totals climbing toward record highs – February 10, 2018 – With more snow on the way. – Read more
New snowfall record for Calgary, Alberta – February 10, 2018 – 9 Feb 2018 – “For this time period in February you have the most snow on the ground ever recorded – Read more
Arctic dips to 76F below zero: ‘Some of the coldest temperatures that people have ever experienced’ – February 12, 2018
Record snowfall in British Columbia – February 10, 2018 – Mt. Timothy dealing with record snowfall – Read more
Record Montana snowfall for the season – February 10, 2018 – Several reporting stations in central and eastern Montana are reporting historic snowfall totals through the first week in February. Read more
Record snowfall in Japan kills seven – February 8, 2018 – Many motorists forced to spend the night in their vehicles. – Read more
First snowfall ever in parts of Morocco – February 8, 2018 – Up to 282 cm (110 inches) of snow in the Middle Atlas. That’s more than 9 feet. – Read more
Chicago – 20 inches of snow by Saturday night possible – February 8, 2018 – “Travel will be very difficult to impossible at times overnight and into Friday morning,” the National Weather Service warns. Snowfall rates of 1 to 2 inches per hour. – Read more
Northern France hit by heavy snow – More on the way – February 8, 2018 – On Tuesday night more than 1,500 motorists were stranded on the N118. – Read more
Heavy snowfall in Spain – Temps far below average – February 7, 2018 – – Wintry conditions are still causing widespread problems on Spain’s roads and train services. Read more
Nearly a thousand fishing boats trapped in ice in NE China – February 6, 2018 – – Nearly a thousand fishing boats for marine farming are surrounded by sea ice in Jinshitan Fishing Port, northeastern China’s Liaoning Province. Read more
More
“If the new moon holds the old moon in her lap, fair weather.”
Most of the time, it’s difficult to see the dark part of the moon during its new and crescent phases.
----During high pressure, fair weather systems though, the atmosphere clears up more than usual, and dim objects are easier seen by the human eye.
So, if you can see the dark part of the moon (that’s the meaning of the cryptic proverb), it means a high pressure system is making its way in, and you can expect good weather.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Today, the latest from the cryptocurrency mania crash.
“Speculation
is an effort, probably unsuccessful, to turn a little money into a lot.
Investment is an effort, which should be successful, to prevent a lot of money
from becoming a little.”
Fred Schwed
Jr., Where Are the Customers' Yachts?: Or a Good Hard Look at Wall Street.
Meet cryptocurrency guru George Weiksner—he’s 11
Published: Feb 13, 2018 11:11 p.m. ET
George Weiksner lives in Old Greenwich, Conn. He attends Greenwich Country
Day School. And, from there, his story—more than likely—diverges from those of
his classmates. At 11 years old, he might look a bit out of place at the upscale New York City restaurant Bagatelle, which hosts Crypto Mondays, a meet-up group where crypto and blockchain enthusiasts meet, glad-hand and share ideas about the world of digital currencies.
George is, in reality, far from out of place.
He is the CEO of Pocketful Of Quarters, which, according to its website, is the “universal cryptocurrency for games.”
“This idea came up. I was coming back from school, and my dad told me about cryptocurrencies. I had this idea with games that [was] one for all your games, and that’s how this idea got started,” he told ICO Investor TV.
The apple hasn’t fallen far from the tree. His dad, Michael Weiksner, a
Stanford Ph.D., is a general
partner at Rostrum Capital, which invests in
next-generation platform companies. According to Michael Weiksner’s LinkedIn
profile, Rostrum plans to invest between $100,000 and $250,000 in 15 companies
over the next two years. (George has his own LinkedIn presence, identifying him
primarily as a student.)
While Pocketful of Quarters may not have raised hundreds of thousands of
dollars in capital, it is finding a niche in the crypto space.
“Cryptocurrency investing is more like, I feel, later, and [an initial
coin offering] is like in the beginning. What we do in our ICO is we’re making
it so you’re investing in something that has already been partly built so ours
is kind of in between, which is kind of nice,” Goerge Weiksner said.
More
February 13, 2018 / 3:13 AM
Cryptocurrency traders to launch lawsuit against Coincheck on Thursday - lawyer
TOKYO
(Reuters) - A group of cryptocurrency traders will file a lawsuit against
Coincheck Inc on Thursday over last month’s theft of $530 million (£382
million) in digital money from the Tokyo-based exchange, a lawyer representing
the claimants said.
The ten traders will file the claim at the Tokyo District Court over Coincheck’s
freezing of cryptocurrency withdrawals, Hiromu Mochizuki, a lawyer representing
the plaintiffs, told Reuters.
The traders will request that Coincheck allows them to withdraw
cryptocurrencies to “wallets” - folders used for storing digital money -
outside the exchange, Mochizuki said. The group may launch a second lawsuit at
the end of the month to claim for damages over the heist, he added.
Coincheck representatives did not immediately respond to phone and
emailed requests for comment.
The Coincheck incident highlighted the risks in trading an asset that
policymakers are struggling to regulate, and has renewed the focus on Japan’s
framework for overseeing these exchanges.
The Tokyo-based exchange, which froze all withdrawals of yen and digital
currencies following the theft, resumed yen-withdrawals from Tuesday, according
to posts on Twitter.
Coincheck said on Friday it would allow customers to withdraw yen after
confirming the integrity of its system security. It added it would keep
restrictions on cryptocurrency withdrawals until it could guarantee the secure
resumption of its operations.
Bitcoin Investors Aren't Paying Their Cryptocurrency Taxes
By Jen Wieczner 2:59 AM EST
Despite months of warnings to pay their
taxes on cryptocurrency profits, American Bitcoin investors aren’t in a
hurry to tell Uncle Sam what they owe.Early data from one popular tax preparation service shows that only a minuscule proportion—just .04%—of U.S. tax filers have reported their cryptocurrency gains and losses to the Internal Revenue Service so far this year. That’s far fewer than the 7% of Americans who are estimated to own Bitcoin or another cryptocurrency, and who are likely to owe taxes to the IRS on those investments.
Of the first 250,000 people to file their tax returns using Credit Karma, fewer than 100 of them disclosed any taxable event for cryptocurrency. Of those, only a single person disclosed a crypto gain or loss big enough to be “significant,” according to Credit Karma, a free credit-monitoring startup.
While it’s still early in tax season—at last count, the IRS had received only 18.3 million individual tax returns so far this year, or some 13% of the total expected this tax season—cryptocurrency investors still seem disproportionately reluctant to report their earnings. (Read our guide on how to pay Bitcoin taxes here.)
For example, in a survey of more than 2,000 American cryptocurrency owners conducted in January by Credit Karma Tax along with research firm Qualtrics, some 57% of respondents said they’d realized gains on their crypto investments—profits the IRS considers taxable. And yet even more Americans (59%) said they had never reported any such gains to the IRS.
More
Bitcoin Industry Grapples With Age-Old Problem of Inheritance
A U.S. man has spent
years trying to untangle the legal mess he found himself in after his
26-year-old son, an early miner of Bitcoins, died in a plane crash
By Nate Lanxon
13 February 2018, 10:09 GMT
Five years ago, Matthew Moody was killed during an observational flight when the two-seater plane he was in crashed flying over a canyon in Chico, California.
His father, Michael Moody, knew his 26-year-old son had been mining Bitcoins — today worth thousands of dollars each — but had no idea how many he had or how to find them. Michael Moody has spent the past three years seeking the answers.
“My son was actually one of the earliest people to mine it,” said Moody, a retired software engineer. “He used his computer at home to mine Bitcoins when you actually could do it that way and he had a few we think.”
The decentralized and unregulated nature of Bitcoin means that without the keys to access his son’s digital wallet, hosted by blockchain.info, Moody has no way of accessing any funds. And it’s almost impossible to find out whether a person is sitting on peanuts or a fortune, as wallets can contain an unlimited number of unique addresses, or identifiers, with Bitcoins assigned to each. Without knowing every address, it’s not possible to locate every piece of currency.
Blockchain.info did not respond to requests for comment on this story.
“There is no authority that could be appealed to fix this,” Nolan Bauerle, director of research at cryptocurrency analysis website CoinDesk, said of an individual’s Bitcoin stash becoming inaccessible after they pass away. “Those coins would be abandoned.”
Moody says entrepreneurial young people, unfamiliar with emerging digital currencies, need to be better educated about the steps needed to be taken to ensure their investments are properly secured, both for themselves and for future heirs.
More
“The indignation school
of writers never tires of pointing out the millions that are stolen in the
Street. But while the millions are being stolen, the billions are being lost.
Nothing crooked—just bad luck and bad brains met together in an effort to do
something that couldn’t be done in the first place.”
Fred Schwed Jr., Where
Are the Customers' Yachts?: Or a Good Hard Look at Wall Street
Technology Update.
With events happening fast in the
development of solar power and graphene, I’ve added this section. Updates as
they get reported. Is converting sunlight to usable cheap AC or DC energy
mankind’s future from the 21st century onwards?
Mass production of new class of semiconductors closer to reality
Date:
February 9, 2018
Source:
University of Waterloo
Summary:
Chemists have made it easier for manufacturers to produce a new class of faster
and cheaper semiconductors.
Two Waterloo chemists have made it easier for manufacturers to produce a
new class of faster and cheaper semiconductors.
The chemists have found a way to simultaneously control the orientation
and select the size of single-walled carbon nanotubes deposited on a surface.
That means the developers of semiconductors can use carbon as opposed to
silicon, which will reduce the size and increase the speed of the devices while
improving their battery life.
"We're reaching the limits of what's physically possible with
silicon-based devices," said co-author Derek Schipper, Canada Research
Chair Organic Material Synthesis at the University of Waterloo. "Not only
would single-walled carbon nanotube-based electronics be more powerful, they
would also consume less power."
The process, called the Alignment Relay Technique, relies on liquid
crystals to pass orientation information to a metal-oxide surface. Small
molecules called iptycenes then bond to the surface locking the orientation
pattern into place. Their structure includes a small pocket large enough to fit
a certain size carbon nanotube that remains after washing.
"This is the first time chemists have been able to externally
control the orientation of small molecules covalently bonded to a surface,"
said Schipper, a professor of chemistry and a member of the Waterloo Institute
for Nanotechnology. "We're not the first ones to come up with potential
solutions to work with carbon nanotubes. But this is the only one that tackles
both orientation and purity challenges at the same time."
Schipper further pointed out that the approach is from the bottom up
with the use of organic chemistry to design and build a molecule which then
does the hard work.
"Once you've built the pieces, the process is simple. It's a
bench-top method requiring no special equipment," Schipper explained.
In contrast to self-assembly techniques which rely on the design of a
suitable molecule to fit snuggly together, this process can be controlled at
every step, including the size of the iptycene "pocket." In addition,
this is the first a solution has been found to tackling the challenge of
aligning and purifying carbon nanotubes at the same time.
The study, co-authored by Serxho Selmani, a doctoral candidate in the
Department of Chemistry at Waterloo, appears this week in the journal Angewandte
Chemie International Edition.
The monthly Coppock Indicators finished January
DJIA: 26,149 +282 Up. NASDAQ: 7,411 +310 Up. SP500: 2,824 +212 Up.
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