144 Exchange Invest Weekly Podcast May 21st, 2022

Transcript: This week in the parish of bourses and market structure:        ASX declares CHESS dates are “No Longer Viable” LME pushes for a better metals market with less OTC opacity and ICE has new buyers for its Euroclear stake while UK antitrust investigates the LSE’s acquisition of Quantile.  My name is Patrick L. Young. Welcome to the bourse business weekly digest. It’s the Exchange Invest Weekly Podcast Episode 144. Good day ladies and gentlemen, this is a very brief reduction of highlights amongst the key headlines from the week in market structure. All the analysis of the many events of the past seven days can be found in Exchange Invest’s daily subscriber newsletter, the unique guide to the bourse business sent daily to your inbox. More details at ExchangeInvest.com. And indeed this week marks a milestone the 9th Anniversary edition of Exchange Invest was published, with an opportunity to reflect on what’s been going on over the course of the last 9 years we looked through the lens of “Young’s Pyramid” of exchanges amongst other things and noted how CME has broadly remained in the lead at the pyramid of exchanges top throughout that period of time while the relative largest loser in rank terms was  B3 which dropped from Tier 1 to the middle of Tier 2.  London Stock Exchange Group was a dramatic gainer of market capitalization throughout particularly due to not only its share price acceleration, which was a minor factor, but also various elements of frenetic acquisition from the Xavier Rolet era, and more recently, the “bulking up” effect through acquiring Refinitiv. All that story and more can be found on our medium page. and you can reflect on how the exchange parish has been growing through the course of the last 9 years as viewed through the lens of Exchange Invest.  The CME Group’s chairman was perhaps the most high profile person that’s chairman and CEO Terry Duffy to appear before the US House of Representatives Agricultural Committee this week. To quote a rather lengthy statement, but it is nonetheless rather on the button.  “FTX proposes to implement a ‘risk management light’ clearing regime that would significantly increase market risks by potentially removing up to $170 billion of loss-absorbing capital from the clear derivatives market, eliminating standard credit checks, destroying risk management incentives by limiting capital requirements and mutualized risk. Under false claims of ‘innovation’, FTX this proposal is nothing more than cost-cutting measures that would come at the expense of risk management, best practices, market integrity, customer safety and ultimately, financial stability.” As Terry Duffy tore apart excoriating the what may be a‘may work for retail’ proposal to create the unsinkable auto closure versus classically margined CCP approach which looks, in my humble opinion, a lot like the blueprints of the Titanic for clearinghouses. Well, you know what it’s like when you hit the iceberg at the wrong angle, or as Terry Duffy described it perfectly, glaringly...