Wall Street spent a record $2.9 billion on political contributions and lobbying in 2019 and 2020, a new study shows. Here’s who spent, and received, the most cash.

Trump Biden
President Joe Biden and former president Donald Trump.

  • Wall Street spent a record $2.9 billion on campaign donations and lobbying in 2019 and 2020, a report suggests.
  • It donated heavily in favor of Biden over Trump. Bloomberg LP was the top donor.
  • Sen. Jon Ossoff, a Georgia Democrat, received more money than any other current member of Congress.
  • See more stories on Insider’s business page.

Financial-services firms and trade associations, as well as their employees, spent a record $2.9 billion on campaign donations and lobbying in the 2019-20 election cycle, according to a new report by Americans for Financial Reform (AFR).

Bloomberg LP, founded by former New York Mayor Michael Bloomberg, spent the most cash, and Sen. Jon Ossoff, a Georgia Democrat, received more money than any other current member of Congress, the report said.

The sector spent around 2.5 times more money on electing President Joe Biden than it did on reelecting former President Donald Trump, the data showed.

The total spend was around 50% more than the previous record, when the financial-services industry spent $2 billion during the 2015-16 election cycle.

Read more: The Great GOP Migration: How South Florida became a shadow capital for Trump conservatives

The financial-services industry donated $1.96 billion to House, Senate, and presidential candidates seeking election in the 2019-20 election cycle, and spent $932.9 million on lobbying across 2019 and 2020, per the report.

AFR based its analysis on contributions reported by both financial-services companies and trade associations and individual employees between January 1, 2019 and December 31, 2020. CNBC first reported on its findings.

Bloomberg LP gave the most money

In total, nearly 600 financial-sector companies and trade associations spent at least $500,000 on contributions and lobbying across 2019 and 2020, per the report. It added that there were more than 2,000 registered lobbyists working across the sector.

These are the 20 companies and associations who spent the most, according to the AFR:

  1. Bloomberg LP – $158.9 million
  2. National Association of Realtors (NAR) – $154.3 million
  3. Fahr LLC – $70.7 million
  4. Citadel LLC – $69.3 million
  5. Blackstone Group – $49.5 million
  6. Charles Schwab & Co – $35.6 million
  7. Susquehanna International Group – $30.7 million
  8. American Bankers Association (ABA) – $26.6 million
  9. Paloma Partners – $25.5 million
  10. Bain Capital – $22.0 million
  11. Renaissance Technologies – $21.3 million
  12. Stephens Group – $18.4 million
  13. Elliott Management – $17.0 million
  14. Wells Fargo – $16.8 million
  15. Intercontinental Exchange Inc – $16.2 million
  16. Lone Pine Capital – $15.2 million
  17. Ryan Specialty Group – $15.1 million
  18. Euclidean Capital – $14.4 million
  19. American Property Casualty Insurance Association (APCIA) – $13.9 million
  20. Securities Industry & Financial Market Association (SIFMA) – $13.8 million

Mike Bloomberg briefly ran for president before pumping his fortunes into helping Biden beat Trump.

Who received the funding

The financial-services sector gave $982.8 million in party-coded contributions across 2019 and 2020 through both individual employee donations and PACs, the report said. Of this, 47% went to Republicans and 53% went to Democrats.

Current congressional candidates received $311 million in contributions from the financial sector to their campaign committees and leadership PACs, according to the AFR.

The 10 current members of Congress who received the largest amounts were:

  1. Sen. Jon Ossoff (D-GA) – $6.5 million
  2. Sen. Mark Kelly (D-AZ) – $6.3 million
  3. Sen. Lindsey Graham (R-SC) – $6.2 million
  4. Sen. Mitch McConnell (R-KY) – $5.5 million
  5. Sen. Raphael Warnock (D-GA) – $5.3 million
  6. Sen. Thom Tillis (R-NC) – $5.1 million
  7. Sen. John Hickenlooper (D-CO) – $4.9 million
  8. Rep. Kevin McCarthy (R-CA) – $4.8 million
  9. Sen. (D-MI) – $4.7 million
  10. Sen. John Cornyn (R-TX) – $4.5 million

These donations were dwarfed by contributions to some candidates who ran for reelection but didn’t retain their seats. Republicans David Perdue and Kelly Loeffler, both running in the Georgia Senate races, each received more than $9 million in donations from the financial-services industry.

Wall Street “seems to have made a particular effort to preserve Republican control of the Senate to both lock in pro-industry measures passed during the Trump administration and to forestall reform under President Biden,” the AFR wrote in the report.

Perdue Loeffler
David Perdue and Kelly Loeffler.

Despite almost equal support for Democratic and Republican candidates, the sector donated overwhelming towards Biden’s presidential campaign over Trump’s.

The finance, insurance, and real estate sector contributed $252.6 million towards Biden’s campaign and external groups supporting him – more than twice as much as the $103.3 million given to Trump, according to the AFR.

In the aftermath of January insurrection at the Capitol, dozens of top US companies halted political donations, including Walmart, Amazon, Morgan Stanley, Dow, and AT&T. Some stopped donating to both Democrats and Republicans, and some to specifically to the 147 GOP lawmakers who voted against certifying Biden as president.

Read the original article on Business Insider

Coinbase says the entire crypto market could be destabilized if Bitcoin’s anonymous creator is ever revealed or sells their $30 billion stake

brian armstrong coinbase
Coinbase CEO Brian Armstrong.

  • Coinbase will go public on the Nasdaq on Wednesday via a direct listing.
  • In its February filing, the trading platform cites Satoshi Nakamoto’s identity as a risk factor.
  • The creator’s cache of bitcoins could wreak havoc on the market if Nakamoto sold their collection.
  • Visit the Business section of Insider for more stories.

Cryptocurrency trading platform Coinbase – which has a over $100 billion valuation – said Satoshi Nakamoto could topple an over $1 trillion bitcoin market.

Coinbase will go public on Wednesday as a direct listing on the Nasdaq. The company has been assigned a reference price of $250 per share, according to NasdaqTrader.

In the documents the company released in February for its public debut, Coinbase said Satoshi Nakamoto – the pseudonym used by the individual or group of people who developed bitcoin – could cause significant damage to the company.

If the identity of the creator was revealed, it could cause bitcoin prices to deteriorate, according to the filing.

The filing also referenced Nakamoto’s personal stash of bitcoins, which totals over 1 million. As of April, one bitcoin was worth over $64,000 – an all-time record.

Nakamoto could negatively affect Coinbase, the company said, and destabilize the entire crypto market if the creator decided to transfer his bitcoins, which are valued at over $30 billion.

Read more: Mark Cuban explains how NFTs could provide new revenue streams for small businesses and creators

The creator was the first entity to ever mine for bitcoins, and Nakamoto’s stake in the digital currency accounts for nearly 5% of the entire bitcoin market, as there are only 21 million bitcoins that can be mined. The entire bitcoin market is worth over $1 trillion.

Bitcoin’s value has largely been driven by its deflationary tendencies. If 1.1 million bitcoins were released into the market, the digital currency’s price would almost surely fall.

Similarly, Bitcoin has been praised for its decentralized nature. The currency is not beholden to any institutions or individuals. If Nakamoto was unmasked, that would place the currency under a single entity, which could discourage traders that bought into the currency for its decentralization.

Coinbase’s success is largely tied to Bitcoin’s rise

In a nod to the Bitcoin creator, Coinbase listed Nakamoto as one of the recipients of its public filing.

Coinbase can attribute much of its success to Bitcoin and its creator, who in 2009 developed it as the first decentralized digital currency.

In the years since, Bitcoin has largely dominated the cryptocurrency world, rising over 400% in the past year alone to easily remain the largest digital coin by market cap.

Coinbase is poised to continue to benefit from the cryptocurrency’s rise. The trading platform is the largest in the US and has over 20 million users.

The company’s founder and CEO, Brian Armstrong, referenced the invention of Bitcoin in his letter that was included in the public filing in February.

“When I first read the Bitcoin whitepaper back in 2010, I realized this computer science breakthrough might be the key to unlock this vision of the future,” Armstrong said. “Cryptocurrency could provide the core tenets of economic freedom to anyone: property rights, sound money, free trade, and the ability to work how and where they want.”

Nakamoto’s name first came to public attention after the white paper was released. The paper outlined the principles of a decentralized peer-to-peer digital payment system. In 2011, the creator moved on from the system but has remained a figure of public interest.

There has been much speculation over the years on the creator’s identity. Names like the Bitcoin developer Nick Szabo, the entrepreneur Craig Wright, and Tesla CEO Elon Musk have been put forward as potential creators of the currency.

While it is unknown whether Nakamoto will ever choose to transfer their cache of bitcoins, it seems unlikely the creator will ever reveal their identity.

By maintaining anonymity, Nakamoto could avoid legal consequences. The untraceable nature of bitcoin has also led to its use for illegal goods and services on the dark web. In January, Treasury Secretary Janet Yellen called for more restrictions on digital currencies like bitcoin because of their use in illegal financing.

The unveiling would also violate one of bitcoin’s founding principles that was outlined in its white paper. If a creator was unmasked, it would pose a threat to the decentralized nature of the currency – a tenet Nakamoto put at the center of his plans for Bitcoin.

Read the original article on Business Insider

Students in China are paying talent agents thousands of dollars to get hired at big Wall Street names as the country opens up its financial market, report says

GettyImages 453012454

Getting a top financial job with one of Wall Street’s big firms is something the well-off value immensely in China.

Talent consultant firms in the country have been recruiting finance professionals to assist rich students secure internships and full-time jobs with Wall Street titans, according to a recent Bloomberg report.

They price these services at $12,000 or more to offer an alternate route for students to get hired by companies like Goldman Sachs, Citigroup, McKinsey, Citadel, or Citic Securities, the report said.

Students are guided by bankers who help them with an entire plan of action ranging from networking, to drafting cover letters, and obtaining in-house referrals. They’ve managed to land coveted jobs in global financial hubs from Shanghai to New York.

The companies either denied association with these consulting firms, or declined to comment when contacted by Bloomberg.

A Shanghai-based agency called Wall Street Tequila is said to charge the highest fees. On its official WeChat account, the firm claims it has helped over 3,000 students secure high paid offers of 1 million yuan ($152,680) in the last seven years, Bloomberg reported.

Wall Street Tequila didn’t immediately respond to Insider’s request for comment.

It isn’t uncommon for bankers in China to tie up with talent agents, take up mentorship roles, and charge fees for internal referrals. But it leads to concern that these opportunities aren’t equally available to all socioeconomic classes.

Sean Wang, a senior banker and author, told Bloomberg: “If you pay to have someone else to write your cover letter, or get a first-round interview, is it fair to those job seekers who don’t have, or can’t afford, such packages?”

One consultant at Accenture told Bloomberg they were approached multiple times by agents, seeking payment in return for an internship referral.

The job market has become more competitive, as both global and regional banks are boosting hiring efforts to expand wealth management in the world’s second-largest economy. Goldman Sachs, UBS, and Credit Suisse are among banks looking to bump up their workforces in China.

Read the original article on Business Insider

How JPMorgan plans to boost wealth management and battle fintech competition

Jamie Dimon
JPMorgan CEO Jamie Dimon

  • JPMorgan, headed up by CEO Jamie Dimon, is the biggest US bank by assets.
  • The bank has big plans for wealth management growth.
  • JPMorgan also made new digital banking hires, including poaching an exec from Goldman.
  • Visit Business Insider’s homepage for more stories.

JPMorgan is the biggest bank in the US and a bellwether for the global financial system. So when the firm’s senior-most leaders talk, Wall Street pays attention.

The bank is set to report first-quarter earnings on Wednesday, April 14. Earlier this month, CEO Jamie Dimon published his annual shareholder letter.

JPMorgan has also recently nabbed three new hires for its digital and product leadership team for consumer and community banking (CBB) from some of its biggest competitors.

Read more:

Recent hires and exits at JPMorgan

Sonali   Headshot SDivilek
One of JPMorgan’s recent hires is Sonali Divilek, who was a key executive at Goldman Sachs’ Marcus in charge of products.

JPMorgan on April 13 announced three new hires to support its consumer- and community-banking team.

Sonali Divilek, who was the head of product at Goldman Sachs’ Marcus, is one of the hires. The departure of Divilek, whom Chase said would be joining the bank this summer as the head of digital channels and products, represents a blow for Goldman’s consumer business as it looks to compete amid a raft of leadership and engineering exits.

Thasunda Brown Duckett, a rising star at the firm and the first Black woman to join its influential operating committee, left JPMorgan in February to lead financial services and retirement firm TIAA. Jennifer Roberts, who headed the firm’s business banking group, was named the bank’s new consumer head in March.

More on people moves here:

Wealth management plans

MASPETH, NY - NOVEMBER 17: Shivani Siroya, Kristin Lemkau and Stephanie Cohen speak onstage at Girlboss Rally NYC 2018 at Knockdown Center on November 17, 2018 in Maspeth, New York. (Photo by JP Yim/Getty Images for Girlboss Rally NYC 2018)
Kristin Lemkau, center, the chief executive of JPMorgan’s US wealth management business.

JPMorgan is planning to significantly expand its financial advisor force, bringing the firm closer in size and scope to its rival firms in wealth management. Over the next five to six years, the bank is considering hiring as many as 4,000 advisors to roughly double its current base, US Wealth Management Chief Executive Officer Kristin Lemkau told Business Insider this fall.

Lemkau, who has been with the bank for over two decades and was previously its chief marketing officer, was named head of JPMorgan’s new wealth division in December 2019. Its various wealth businesses, including its self-directed wealth product, were reorganized under one umbrella.

Read more on JPMorgan’s wealth management plans:

Read the original article on Business Insider

The New York Stock Exchange is minting crypto art commemorating the first trades of 6 companies that recently went public

NYSE NFT
  • The New York Stock Exchange announced on Monday that it had minted six NFTs.
  • The NFTs represent the first trades of several companies that recently went public on the NYSE.
  • The crypto art pieces are not currently up for sale, but will be gifted to the companies, a source told Insider.
  • See more stories on Insider’s business page.

The New York Stock Exchange (NYSE) announced on Monday that it was getting into crypto art by minting its own digital collectibles designed to commemorate the first public trade of six stocks.

The NYSE is not only the largest stock exchange in the world, but it is also the first to get into crypto art. The collectibles will represent the first trades of Spotify, Snowflake, Unity, DoorDash, Roblox, and Coupang. NYSE said it plans to launch more first-trade collectibles in the future.

The digital collectibles will operate as non-fungible tokens or NFTs. NFTs are digital collectible tokens that allow the buyer to connect their name directly to the creator via the blockchain.

NFTs have boomed in recent months. In February, one crypto art piece sold for nearly $70 million. Since, celebrities and public figures from Twitter CEO Jack Dorsey to singer Shawn Mendes have gotten in on the trend, which has brought in millions for opportunistic creators and resellers of the pieces.

Read more: NFTs, or non-fungible tokens, are the hottest thing in entertainment, art, and crypto right now. Here’s a simple explanation of the craze.

While the NYSE appears to be getting in on the NFT trend, the exchange’s tokens are not up for sale. The NFTs are housed on Crypto.com, a less than month-old NFT trading platform that has already launched crypto art sales for several celebrities including Snoop Dogg and Boy George.

A source familiar with the matter told Insider NYSE does not plan to sell its NFTs, but has already gifted them to the respective companies. The NYSE also plans to mint future NFTs and gift those to the memorialized companies as well, according to the source.

The NFTs for each company feature a short clip containing information about the first trade, including the sale price, date, and a string of numbers representing the first trade quote code.

Stacey Cunningham, the President of NYSE, said the NFTs will help commemorate the very first moments a company joins NYSE by highlighting the data from a company’s very first trade.

“NYSE technology is processing over 350 billion order, quote and trade messages across our markets on our busiest days, more than any other exchange in the world,” Cunningham said in a LinkedIn post. “Only one of those messages marks the NYSE First Trade: the exact moment a company became public, creating an opportunity for others to share in their success.”

Read the original article on Business Insider

Inside JPMorgan’s plans to boost wealth management and battle fintech competition

Jamie Dimon
JPMorgan CEO Jamie Dimon

  • JPMorgan, headed up by CEO Jamie Dimon, is the biggest US bank by assets.
  • The bank has big plans for wealth management growth.
  • JPMorgan is also looking to bring workers back to offices, including a new Manhattan HQ.
  • Visit Business Insider’s homepage for more stories.

JPMorgan is the biggest bank in the US and a bellwether for the global financial system. So when the firm’s senior-most leaders talk, Wall Street pays attention.

The bank is set to report first-quarter earnings on Wednesday, April 14. Earlier this month, CEO Jamie Dimon published his annual shareholder letter.

Read more:

Wealth management plans

MASPETH, NY - NOVEMBER 17: Shivani Siroya, Kristin Lemkau and Stephanie Cohen speak onstage at Girlboss Rally NYC 2018 at Knockdown Center on November 17, 2018 in Maspeth, New York. (Photo by JP Yim/Getty Images for Girlboss Rally NYC 2018)
Kristin Lemkau, the chief executive of JPMorgan’s US wealth management business.

JPMorgan is planning to significantly expand its financial advisor force, bringing the firm closer in size and scope to its rival firms in wealth management. Over the next five to six years, the bank is considering hiring as many as 4,000 advisors to roughly double its current base, US Wealth Management Chief Executive Officer Kristin Lemkau told Business Insider this fall.

Lemkau, who has been with the bank for over two decades and was previously its chief marketing officer, was named head of JPMorgan’s new wealth division in December 2019. Its various wealth businesses, including its self-directed wealth product, were reorganized under one umbrella.

Read more on JPMorgan’s wealth management plans:

Recent hires and exits at JPMorgan

Thasunda Brown Duckett, a rising star at the firm and the first Black woman to join its influential operating committee, left JPMorgan in February to lead financial services and retirement firm TIAA. Jennifer Roberts, who headed the firm’s business banking group, was named the bank’s new consumer head in March.

More on people moves here:

Read the original article on Business Insider

The Archegos meltdown will result in a $10 billion loss for global banks, JPMorgan says

Wall Street.
Big Tech recovers after a rough day Wednesday on Wall Street.

  • Global banks are expected to lose up to $10 billion from the Archegos meltdown, JPMorgan said.
  • This is 5x the normal loss level for a collateralized daily mark-to-market business, JPMorgan added.
  • It however cited three lessons the industry could take away from the implosion that has roiled the markets.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell

Global banks are expected to lose up to $10 billion following the Archegos Capital Management meltdown, JPMorgan said Monday – raising its estimate from an initial $2 billion-$5 billion – with Credit Suisse Group and Nomura Holding hardest hit.

“One line of argument which could explain why the scale of losses suffered by [Credit Suisse] and Nomura was higher could be a higher level of leverage extended by these banks compared to [Goldman Sachs and Morgan Stanley], which seem to have suffered smaller losses if any,” JPMorgan analysts led by Kian Abouhossein said in a research note Monday.

JPMorgan clarified that there may also be additional considerations that determined the sizable difference between the scale of losses suffered, such as the timing of the sale of positions, among others. Nonetheless, the entire episode affects the industry overall, given that global banks could end up losing five times the normal loss level for a collateralized daily mark-to-market business.

JPMorgan cites three lessons the industry could take away from the fund’s implosion.

First, investment banks in general are in better shape today and are more focused on high-volume execution platforms.

“There is no excessive leverage in the [investment banking] or [private banking] industry,” JPMorgan said. “Although [private banking] leverage has been increasing, it is nowhere near prior peaks.”

The bank also said it sees no excessive equity-swap growth, a simple instrument all parties will benefit from.

Second, US regulatory frameworks like Basel III and the Dodd-Frank Act have improved the risk profile of investment banks. JPMorgan, however, noted that there is still weak oversight for non-bank entities, especially when it comes to family offices.

Archegos, a family office founded in 2012, did not have to disclose investments, unlike traditional hedge funds. JPMorgan also pointed to the lack of transparency when it came to equity-swap filings.

The Archegos sell-off exposed the fragility of the financial system, especially those involving lesser-known practices such as total return swaps, a derivative instrument that enabled Bill Hwang’s office not to have ownership of the underlying securities his firm was betting on and the secrecy of family offices. Typically, family offices enjoy the “private adviser exemption” provided under the Advisers Act to firms as these usually advise less than 15 clients, among other conditions.

But JPMorgan said, “filing requirements would have applied to Archegos given its sizable exposure to some US securities. However, the fact that Archegos did not file with the [Securities and Exchange Commission] can be explained by the usage of total return swaps, which seems to be the primary method through which the sizable positions were built by Archegos.”

Dan Berkovitz, a Democratic commissioner on the Commodity Futures Trading Commission, denounced family offices and their ability to skirt some oversight.

“A ‘family office’ has nothing to do with ordinary families,” he said in a statement on April 1. “Rather, it is an investment vehicle used by centimillionaires and billionaires to grow their wealth, reduce their taxes, and plan their estates.”

Third, JPMorgan said private banks, specifically those linked to Archegos, moving forward could improve their onboarding, especially with clients with backgrounds such as Hwang, who has run into trouble in the past. Private banks could also strengthen their risk management by giving less leverage to non-transparent family offices with concentrated positions and ensure checking the clients’ rehypothecation risk, among others.

Archegos in late March used borrowed money to make large bets on some stocks until Wall Street banks forced Archegos to sell over $20 billion worth of its shares after failing to meet a margin call. Hwang grew his family office’s $200 million investment to $10 billion. Reports say the former Tiger Management trader lost $8 billion in 10 days.

Read the original article on Business Insider

Goldman Sachs’ Marcus unit is struggling with burnout, blown deadlines, and a tech-talent exodus

Hello everyone!

Welcome to this weekly roundup of stories from Insider’s Business co-Editor in Chief Matt Turner. Subscribe here to get this newsletter in your inbox every Sunday.

What we’re going over today:

marcus goldman sachs burnout 2x1

Here’s what’s trending this morning:


Goldman Sachs exodus

From Dakin Campbell:

Goldman Sachs launched its consumer-banking arm five years ago with a marketing blitz and much fanfare, sending a strong signal to Wall Street that it wanted to disrupt retail banking – and reshape its own future.

Since then the bank has built it into a $1 billion business by standing up new technologies at breakneck speed.

But now Marcus staffers are quitting in droves at the precise moment the bank needs them most, just as it announced a slew of ambitious products and reshuffled its corporate structure to focus on growth.

Former employees, as well as banking consultants and an analyst briefed by Insider, said the exodus raises questions about Goldman’s ability to drive its people hard and still compete with Main Street banks.

Read the full story here:

Also read:


Amazon employee reviews

Jeff Bezos
Jeff Bezos

From Ashley Stewart and Eugene Kim:

Internal Amazon documents show the company has a five-tiered ranking system for employee performance reviews and expects managers to rank 20% of employees at the top level, 75% in the middle tiers, and 5% in the bottom tier.

More than half a dozen employees who spoke with Insider said the tier system was evidence of stack ranking, a controversial performance-review system in which employees are evaluated on a curve and a certain percentage must rank at the bottom – which could hurt both an employee’s compensation and their future at the company.

Employees who have been part of the performance-review process told Insider the ratings had to be distributed across teams.

Read the full story here:

Also read:


DEI burnout

DEI consultant burnout 2x1

From Marguerite Ward:

Doris Quintanilla is drained.

For over four years, she’s worked on corporate diversity, equity, and inclusion as the CEO and cofounder of The Melanin Collective – but never in a climate like today’s.

In the wake of the killing of George Floyd, her inbox has been flooded with requests from corporate and nonprofit leaders. They want change, and they want it fast. But at the same time, she felt many were not respecting her.

Read the full story here:

Also read:


Adobe’s ad bet

Adobe CEO Shantanu Narayen
Adobe’s CEO Shantanu Narayen.

From Lauren Johnson:

Five years ago, Adobe had big advertising ambitions.

Adobe acquired $540 million for TubeMogul, a video adtech company that buys ads for brands programmatically and competed with Google, Amazon, The Trade Desk, and MediaMath.

At the time, Brad Rencher, then-EVP and general manager of Adobe’s digital experience business unit and a key player in the TubeMogul integration, promised the deal would create a “‘one-stop shop’ for video advertising, providing even more strategic value for our Adobe Marketing Cloud customers.”

But last summer, Adobe shut down a big part of its TubeMogul acquisition, closing its advanced TV business that sold linear TV ads and political advertising to advertisers.

Read the full story here:

Also read:


ICYMI: Fidelity’s first cryptoasset analyst on opportunities

Bitcoin Bull nft art cryptoart
“Bitcoin Bull” by Trevor Jones.

Vicky Ge Huang talked to Nic Carter, an investor at venture-capital firm Castle Island Ventures and founder of Coinmetrics. You can read the full story here:

Also read:


INVITATION: Keeping our promises to the planet

Join us Tuesday, April 20 at 12 p.m. ET | 5 p.m. GMT | 6 p.m. CET for a free virtual event, “Act to Impact: Keeping our Promises to the Planet.” Hear from corporate leaders, climate activists, experts, and artists about how we all can mitigate and adapt to climate change today to avoid catastrophe in the near future

Sign up here.

Lastly, don’t forget to check out Morning Brew – the A.M. newsletter that makes reading the news actually enjoyable.

Here are some headlines you might have missed last week.

– Matt


Read the original article on Business Insider

3 reasons why volatility could come roaring back to a stock market that’s drifting along near record highs, according to UBS

NYSE Trader
Traders at the New York Stock Exchange.

  • A key tracker of stock-market volatility at its lowest since early 2020 at the same time that US stocks are at record highs.
  • Investors should anticipate Wall Street’s so-called “fear gauge”, or VIX, to come off those lows in the coming months, said UBS.
  • Volatility may pick up pace as investors wrestle with inflation worries and COVID-19 variants.
  • See more stories on Insider’s business page.

Wall Street’s key measure of stock-market volatility is at its lowest since the COVID-19 crisis took off in the US last year, but that calmness will likely break over the next few months, according to UBS.

The US stock market has soared to record highs in 2021 on the back of accelerating coronavirus vaccinations worldwide and roughly $5 trillion in financial aid deployed by the US government to mitigate the pandemic’s economic damage. The vaccinations and stimulus packages have been laying the groundwork for a further reopening of the world’s largest economy as people begin to rebuild work and school routines and spend the money sent to them by Uncle Sam.

The S&P 500 index has shot above the 4,100 level and the Dow Jones Industrial Average tracking blue-chips is at its strongest levels, driven by cyclical sectors such as energy and industrials that stand to benefit from increased economic activity.

Wall Street’s so-called “fear gauge,” at the same time, has dropped below the 17 level, the lowest since early February 2020, before the World Health Organization declared the coronavirus outbreak a pandemic. But don’t expect the Cboe volatility index to continue to stay that low, said the world’s largest wealth manager in a note published Friday.

UBS noted a news report that at least one investor bought about $40 million in VIX call options that indicate the buyer expects market volatility to pick up pace over the next three months. One or more investors anticipated the VIX to reach above the 25 level and rise towards 40 by mid-July, Reuters reported, citing trading data.

“We see reasons to expect periodic bouts of higher volatility in the near term,” said Mark Haefele, chief investment officer at UBS Global Wealth Management, in the note.

Growth vs inflation

Firstly, investors may be torn between optimism over accelerating economic growth and worries over higher inflation. Among the signs that recovery is taking further hold was the recent and strongest reading in services-sector activity since 1997 from the Institute for Supply Management. European growth should also strengthen as vaccinations increase.

“Still, as pent-up demand meets supply constraints, a pickup in inflation could well unsettle investors,” said the investment bank. This week, Dallas Federal Reserve President Robert Kaplan said inflation could rise “well in excess of 2.5%,” over the summer, which would be well above the Fed’s 2% target.

COVID-19 strains

Investors have so far looked through news about variant strains of COVID-19. “This optimism could be put to the test by the spread of new variants of the virus, especially in areas where the vaccination effort has been progressing well, such as in the US.”

UBS noted “pockets” of rising infections in Ohio and Wisconsin.

Trading activity

Volatility has been “sporadically heightened” by a rise in institutional and retail activity in the options market, along with the increased share of growth stocks in major equity indexes, said UBS.

“In the first quarter we saw retail activity driving volatility in individual stocks, such as GameStop, which spilled over into broader market swings,” said Haefele.

Read the original article on Business Insider

Cash App’s hiring spree – Goldman’s push into auto tech – Consulting confessions

2021 01 21T141126Z_2_LYNXMPEH0K0S1_RTROPTP_4_GOLDMANSACHS RESULTS M A.JPG
US stock markets hit new all-time highs this week, but were set to fall on Wall Street on Friday

Good morning and welcome to Insider Finance. I’m Dan DeFrancesco, and here’s what’s on the agenda today:

If you’re not yet a subscriber, you can sign up here to get your daily dose of the stories dominating banking, business, and big deals.

Like the newsletter? Hate the newsletter? Feel free to drop me a line at ddefrancesco@businessinsider.com or on Twitter @DanDeFrancesco.


Square’s Cash App is hiring for a slew of positions hinting at plans to attract more merchants and compete directly with payment networks like Mastercard and Visa

Jack Dorsey

Square’s Cash App had a massive 2020. Now the payment giant is looking to build on that momentum by hiring for a slew of positions for the personal finance app. Here’s a look at what the new roles mean for the company, and the competitors it could be looking to take on.

Read more here.


The world’s biggest investors have realized fixed income won’t generate the returns they need, and they’re turning to hedge funds to fill the gap

GettyImages 1229890667

Hedge fund assets started the year at an all-time high, thanks in part to low interest rates. Now, desperate institutions are replacing low-yielding bonds with hedge funds in their portfolios. Here’s what else you need to know.


Deutsche Bank teamed up with 6 firms led by women, people of color, and veterans on a $750 million bond sale as Wall Street looks to elevate minority shops

Annie Seelaus, CEO of R. Seelaus & Co, Sidney Dillard, a partner and head of corporate investment banking at Loop Capital, David Jones, co-founder, president and CEO of CastleOak Securities

For the first time ever, Deutsche Bank appointed six firms led by women, people of color, and veterans to lead its $750 million bond. Read more on how appointing minority-led firms promotes equity on Wall Street.


A new Goldman Sachs team is on a $7 trillion mission: conquer mobility by making deals with Tesla and Waymo rivals

Goldman Sachs

Goldman Sachs sees the auto industry’s tech revolution as a big opportunity to win new business. The bank is now bringing together its industrial and tech teams to focus on auto tech deals. Get the full rundown here.


Must-know promotions, exits, and hires at firms like BlackRock, JPMorgan, Citadel, and Goldman Sachs

digital wall street virtual remote work 3 4x3

The top people moves across the street, from Carey Halio taking over as Goldman’s new head of investor relations to Paul Bodnar being named global head of BlackRock Sustainable Investing. Read them all here.


Here’s why it’s time to shorten the settlement cycle for US stocks

Michael Bodson, DTCC
Michael Bodson, DTCC

Michael Bodson, the president and CEO of the DTCC, makes the case for moving the settlement cycle for US securities from two days to one. Here’s why.


Odd lots:

Consulting confessions: 6 current and former staffers at Deloitte, PwC, and other top firms detail pandemic burnout (Insider)

Inside Archegos’s Epic Meltdown (WSJ)

BlackRock Increased Fink’s Pay 18% to $29.9 Million for 2020 (Bloomberg)

The SPAC boom is coming for fast-growing fitness and wellness companies. Experts reveal the 6 blank-check firms on the hunt. (Insider)

Meet 13 women who left Big Law to launch their own legal tech startups (Insider)

‘They can do what they want’: Archegos and the $6tn world of the family office (FT)

Read the original article on Business Insider