Sep 13, 2011
Asia stocks pull back as financials weigh Asia markets trade mostly weaker. Tokyo stocks post small losses.
Dollar gains against major rivals The greenback picks up steam against major rivals, with Europe’s debt troubles dominating global asset markets.
Canada stocks log first win in four sessions Canadian stocks rise Tuesday, with their first win in four sessions supported by gains among mining and energy issues as prices for natural resources advanced after a rough day-ago session.
Brazil stocks slip; retail sales above consensus Brazil’s key equity index edges lower Tuesday, with many interest-rate sensitive shares down as a strong monthly retail-sales report highlights inflation and interest-rate concerns in the country.
Australian gold stocks poised to shine Analysts identify their picks of the Australian-listed gold sector.
U.S. stocks edge up with Europe in view Major indexes rise for the second session this week, with Wall Street latching onto any signs that Europe will contain its debt crisis.
Financials extend gains as regional banks rally Financial stocks extend gains for a second session as regional banks rally following an upgrade of Fifth Third Bancorp.
Microsoft, Cisco gains lead broad tech rise Tech stocks mostly rise in early activity, with Cisco Systems and Microsoft in the spotlight in advance of closely watched events scheduled by the two sector giants.
ACCC boss Rod Sims on his SME learning curve, Rinehart blocks access to family court fight, Warning after worker wins compo for work-from-home injury: Smartcompany News & Analysis
Today on SmartCompany we look at Gina Rinehart’s successful bid to block the media from her court battle with her family, bring you a warning from the curious case of a worker who received compensation for falling down the stairs while working at home and examine the Government’s back flip on forcing restaurants and cafes to provide separate menus for public holidays and Sundays. Plus in Entrepreneur Watch, James Thomson looks at why the Pratt family’s court battle has a way to go yet.
For all this and more, head to our home page.
For all this and more, head to our home page.
| Entrepreneur Watch |
|James Thomson |
The court battle between the estate of Richard Pratt and his former mistress gets messier by the day – and it still has a way to run.
|Microsoft showcases Windows 8|
|MICROSOFT has pulled back the curtain on Windows 8 which is designed to power not only PCs but also rivals to Apple's iPad.|
|HTC's 3D smartphone launched|
|HTC today has released its 3D camera phone in Australia. It's the second phone locally that lets users create and view 3D content.|
|Dell unveils $US5bn buyback|
|DELL has approved a plan to buy back up to $US5 billion in stock, or about a fifth of its current market value.|
|Cochlear facing six-year low|
|COCHLEAR'S recall of its Nucleus 5 hearing device could see the company post its weakest full-year earnings in six years.|
|Local authors join online book lawsuit|
|AUSTRALIAN authors have joined a legal action against five US universities accused of "abducting" more than seven million books|
|NBN will 'destroy' private firms|
|THE federal government has been accused of destroying private businesses installing broadband networks.|
|Telstra, Google exit IIA|
|IT giants turn their back on the Internet Industry Association.|
Intel Corp and Google Inc launched a development partnership aimed at accelerating the chipmaker's foray into smartphones. They will work together to optimize future versions of Google's Android mobile software for Intel's "Atom" processors, hoping to speed the development and time-to-market of future Intel-powered smartphones.
Microsoft Corp handed out sleek new tablet computers with a test version of Windows 8 at its annual developer conference, to spark excitement over its new operating system.
Cisco Systems Inc CEO John Chambers said he remained upbeat about technology spending by customers despite an uncertain economic outlook.
Dell Inc, the world's second-largest computer maker, is cautiously optimistic that its strong performance in Europe and Asia will continue, but is concerned about U.S. government spending, an executive said.
The forecasts will be key for BlackBerry maker Research In Motion this quarter, as investors grope for hints that the company's long downturn is coming to an end.
Nintendo's attempt to rescue its failed 3DS handheld games gadget failed to dispel market gloom, triggering a 5 percent share slide and stoking deep worries for an iconic brand desperate to win back users.
|Developers get early taste of Windows 8|
|September 13, 2011 05:06 PM ET|
|ANAHEIM, California (Reuters) - Microsoft Corp handed out 5,000 sleek Samsung tablet computers running a test version of Windows 8 at its annual developer conference on Tuesday, hoping to stoke excitement over its new operating system. | Full Article|
|Google bid for Motorola rose in negotiation: filing|
|September 13, 2011 07:51 PM ET|
|(Reuters) - Google Inc raised its offer for Motorola Mobility Holdings Inc by 33 percent to $12.5 billion over two weeks of negotiations between the two companies, according to a regulatory filing on Tuesday. | Full Article|
|Exclusive: U.S. in criminal probe of eBay employees|
|September 13, 2011 07:08 PM ET|
|SAN FRANCISCO (Reuters) - U.S. prosecutors have launched a criminal probe into whether eBay Inc employees took confidential information from classified ad website Craigslist as eBay sought to build a rival service, a copy of a grand jury subpoena obtained by Reuters shows. | Full Article|
|Cisco slashes sales outlook, enters new era|
|September 13, 2011 06:58 PM ET|
|SAN FRANCISCO/NEW YORK (Reuters) - Cisco Systems Inc slashed its long-term forecasts, acknowledging an end to an era of scorching growth after cutting thousands of jobs in a sweeping four-month reorganization. | Full Article|
|Intel, Google unveil Android mobile partnership|
|September 13, 2011 04:03 PM ET|
|SAN FRANCISCO (Reuters) - Intel Corp and Google Inc launched a development partnership on Tuesday, the latest effort by the world's dominant maker of PC microprocessors to break into the booming smartphone market. | Full Article|
Public Policy Keynote Address by Commissioner Scott D. O’Malia before 2011 International Swap and Derivatives Association, Annual North America Conference
September 13, 2011
I would like to thank Stephen O’Connor and the International Swap and Derivatives Association (ISDA) for inviting me to speak with you today. As I was thinking about my remarks for this conference I was struck by its title, “Shaping the Future of Derivatives.” Even before the passage of the Dodd-Frank Act, the Commission has worked to shape the future of derivatives. To date, the Commission has issued 57 advance notices of proposed rulemaking or notices of proposed rulemaking, two interim final rules, 13 final rules, and one proposed interpretative order. Only last Thursday, though, did the Commission finally turn its attention in its last open meeting to addressing how industry will be required to comply with the various implementation requirements for the numerous, intertwined rulemaking initiatives.
The Chairman has frequently used the word “mosaic” to describe our proposed regulatory framework, including during last Thursday’s meeting. I looked up the word in the Merriam-Webster Dictionary, which defines “mosaic” as “a surface decoration made by inlaying small pieces of variously colored material to form pictures or patterns.” The definition notes that, in general, “mosaics” are highly detailed. Unfortunately, the implementation proposals that the Commission approved last Thursday are anything but detailed. Rather than setting forth a guide to understanding how the different rulemaking implementation, or effective date, sections should be pieced together to form a “mosaic”, the implementation proposals themselves more resembled a Jackson Pollack painting from the abstract expressionist movement.
As I have repeatedly emphasized, we can no longer continue to provide the market with broad abstractions. The Commission is in the process of approving final rulemakings. Now is the time for the Commission to give the market concrete direction on how and when to translate the Dodd-Frank rulemakings into an operational reality.
Those of you watching the Commission meeting last Thursday would have noticed that I voted against the implementation proposals. You may have been surprised because, since the beginning of this year, I have continually called for the Commission to present the market with an implementation schedule for notice and comment. I had hoped that an implementation schedule would give market participants the certainty that they need to begin an orderly transition to regulation. I had expected that any such schedule would, at a minimum, specify:
- for each registered entity, compliance dates for each of its entity-specific obligations; and
- for each market-wide obligation, such as the clearing and trading mandates, the entities affected (whether they are registered and unregistered), along with appropriate compliance dates.
In contrast, the two proposals that the Commission took up for consideration raised more questions than they answered.
First, the proposals only addressed a handful of the rulemakings that we have proposed and finalized. Second, the proposals failed to do several key things. The proposals did not provide market participants with reasoned estimates of beginning and end dates. The proposals did not explain their rationale for determining that 90, 180, and 270-day timeframes were appropriate, rather than the longer timeframes that some commenters had sought when they provided feedback after the Commission’s roundtable on implementation issues. They did not quantify the costs and benefits of the 90, 180, and 270-day timeframes in comparison with alternatives. Finally, the proposals failed to define, or even acknowledge that the Commission intends to define, key triggering terms, such as “made available for trading.”
I voted against the proposals because they failed to provide a comprehensive implementation strategy. They simply did not set forth the clear transition milestones that market participants have repeatedly requested. I hope that the final rulemakings will better demonstrate that the Commission is clear on: (i) how all of its proposals work in concert together; (ii) how market participants can comply with all such proposals; and (iii) when market participants need to be in compliance.
With the hope of giving the market some insight, and based on the limited details in the implementation proposals as well as my deliberations with the Chairman at last Thursday’s meeting, let me share what I believe will be the rough timeline for implementation of the Dodd-Frank rules. I believe that entities that the implementation proposals deem “Category 1” (i.e., swap dealers, major swap participants, and active funds) will not become subject to mandatory clearing until approximately the third quarter of 2012. Entities that the proposals deem “Category 2” or “Category 3” will not become subject to mandatory clearing until 90 or 180 days later. To resolve any lingering ambiguity, the Commission may determine that a swap is subject to mandatory clearing before the third quarter of 2012, but the implementation proposals clarify that entities need not be in compliance at the time of such determination. As I noted last Thursday, the criteria that the Commission will use to make mandatory clearing determinations are still unclear. Therefore, I would continue to encourage market participants, as well as the public, to comment on the letter that I have circulated regarding the need for more guidance on such criteria.1
How should the Commission move forward and responsibly shape the future of derivatives? Given where we are at today, having published the myriad of rules that comprise the “mosaic”, what should our next steps be?
First, the Commission needs to refine its implementation proposals. At a minimum, we need to provide:
- more definite dates for entity-specific obligations;
- more transparent criteria for phasing of the clearing and trading mandates, including a fuller explanation of when exactly the Commission will consider a swap to have been “made available for trading”,
- more detail on the phasing (by participant, asset class, or otherwise) of other market-wide obligations, such as data reporting; and
- the proposals should at least reference the provisional swap execution facility (SEF) registration process, which is crucial to the success of the trading mandate.
The implementation proposals have a 45-day comment period. I urge you all to file comments, not only on the proposals but on the questions that I included in my dissent, which should be published both on the Commission’s website and in the Federal Register shortly.
Second, the Commission needs to focus on resolving extraterritoriality and inter-affiliate issues. If I were to think like a market participant for a moment, the first questions I would ask when confronted with Dodd-Frank are which of my business lines are affected, and which of my entities are affected? Unless the Commission resolves extraterritoriality and inter-affiliate issues, market participants cannot definitively answer these questions and cannot move forward to design the most cost-efficient methods of compliance. Neither issue, however, appears on the preliminary schedule of rules that the Commission will be considering over the next months into the first quarter of 2012 that the Chairman set forth on Thursday.
Third, the Commission needs to focus on international coordination. As I stated last Thursday, it is becoming increasingly clear that the schedule, or timeline, for financial reform is converging among the G-20 nations. It is less clear that the substantive policies underlying financial reform is experiencing the same convergence. That fact may have competitive implications that we have yet to examine fully. Specifically, we need to be more cognizant of imposing costs on entities within our jurisdiction that competitors outside of our jurisdiction will not bear. Also, for entities operating in multiple jurisdictions we should be more cognizant of minimizing unnecessary duplicative regulatory requirements, and opportunities for international regulatory arbitrage.
Finally, I’d like to say a word on regulation of derivatives clearing organizations (DCOs). I noticed that such regulation is an item on this conference’s agenda. As I have stated previously, it will be important for the final regulations to strike the appropriate balance between managing DCO risks and facilitating open access, which includes ensuring that market participants do not find it too costly to clear. Another related topic that has been the subject of much debate recently is participant eligibility. For example, in anticipation of potential Commission regulations ICE Clear Credit lowered its minimum capital requirement for membership to $100 million, but imposed a new excess capital requirement equal to at least 5 percent of customer segregated funds. I understand that there are many different perspectives on this topic. Since I will need to make a decision on final DCO regulations in the near future, I am curious to hear your thoughts on participant eligibility, as well as on any other aspects of DCO regulation. What should I consider in determining whether the final DCO regulations have struck the best balance between risk management and open access?
How We Can Get There
To help the Commission take responsible next steps, I am setting forth specific requests.
First, generally, the following requests implicate all rulemakings:
- Comprehensive Implementation Schedule. The Commission needs to develop and publish a comprehensive implementation schedule for notice and comment.
- Extraterritoriality, Inter-Affiliate Transactions and International Coordination. The Commission needs to develop detailed and coordinated rulemakings with the Securities Exchange Commission (SEC) on the transactions and entities that will be subject to our regulatory “mosaic.” The Commission also needs to examine, in greater detail, the competitive effects of its regulations in the context of the global derivatives markets.
- Improved Cost-Benefit Analyses. The recent DC Circuit Court Business Roundtable2 decision was a wakeup call that I hope the Commission will not ignore. The Commission needs to improve its cost-benefit analyses, including quantifying the costs and benefits of its regulations and detailing the rationale for rejecting alternatives.
Second, regarding requests that implicate specific rulemakings:
- Customer Clearing Documentation. On July 19, 2011, the Commission approved a proposal that targeted the FIA-ISDA Cleared Derivatives Execution Agreement. As with DCO participant eligibility, I have heard many different perspectives on this proposal. I have called for a staff roundtable so that the Commission might gather interested market participants (i.e., swap dealers, buy-side, trading platforms, and DCOs) in one room to discuss the necessity of this proposal. It’s my understanding that we will have a staff roundtable in early October.
- Guidance on Mandatory Clearing and “Made available for Trading.” The Commission must explain its standards and priorities for determining which swaps should be subject to mandatory clearing. As I previously mentioned, I have circulated a letter to market participants, as well as the public, to solicit comments. Since the Commission failed to give any indication of its standards and priorities in previous rulemakings, we should hold a roundtable on the mandatory clearing determination. We should also at that roundtable discuss what “made available for trading” means.
- Investment of Customer Funds. The Commission should re-propose the entirety of this rulemaking, given its potential effects on intermediaries and the lack of a quantitative cost-benefit analysis.
Finally, on requests that implicate Commission priorities:
- Confidential Market Data. The Commission must develop policies and procedures to protect confidential market data, especially given its new data stewardship responsibilities under Dodd-Frank.
- Technology, Technology, Technology. The Commission needs to stop investing the minimum in technology. In its budget, Congress provided a spending floor on technology and we are treating as a ceiling. The fiscal year ends in 17 days. Let’s invest the majority of our $6 million in carryover balances in technology. It may be too little, but it’s not too late.
I’m looking forward to learning from all of your perspectives on the important issues that are being taken up by the Dodd-Frank Act rulemakings. Finally, before I close, I would once again encourage all of you to submit your comments, both on the rulemakings and also on the issues that I have tried to bring their proper due attention, like guidance on mandatory clearing determinations. So thank you, again, to ISDA and to Stephen for inviting me to speak today, and for arranging for us all to have what I am sure will be a valuable dialogue on these issues.
2 Business Roundtable and the United States Chamber of Commerce vs. SEC, No. 10-1305, 2011 U.S. App. LEXIS 14988 (July 22, 2011).Last Updated: September 13, 2011