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U.S. ETFs/ETPs gathered $2.4 billion in new assets in August
Asset Management
<p>LONDON — September 9, 2015 — After a roller coaster August for investors, ETFs/ETPs listed in the United States gathered just US$2.4 billion in net new assets, according to ETFGI’s preliminary ETF and ETP global insights report for August 2015.</p> <p>In the first eight months of 2015 record levels of net new assets have been gathered by ETFs/ETPs listed globally, with net inflows of US$219.7 Bn marking a 16% increase over the prior record set during the first eight months of 2014. In the United States net inflows reached US$127.5 Bn, which is 19% higher than the prior record set last year, while in Europe year to date (YTD) net inflows climbed to US$59.7 Bn, representing a 17% increase on the record set YTD through end of August 2014. In Japan, YTD net inflows were up 74% on the record set last year, standing at US$28.9 Bn at the end of August 2015.</p> <p>“Worries about China’s stock market, currency and economy mixed with falling commodity prices helped to cause a correction in the US stock market. Investors in the United States are concerned given the uncertainty of when the Fed will raise interest rates. The S&amp;P 500 index ended August down 6%.", according to Deborah Fuhr, managing partner at ETFGI.</p> <p>At the end of August 2015, the US ETF/ETP industry had 1,768 ETFs/ETPs, assets of US$2.03 trillion, from 85 providers listed on 3 exchanges.<br /> U.S. ETFs/ETPs see net inflows of US$2.4 Bn in August<br /> In August 2015, ETFs/ETPs listed in the United States gathered net inflows of US$2.4 Bn.  Fixed income ETFs/ETPs gathered the largest net inflows with US$4.7 Bn, followed by commodity ETFs/ETPs with net inflows of US$822 Mn while equity ETFs/ETPs experienced the largest net outflows with US$6.4 Bn.</p> <p>YTD through end of August 2015, ETFs/ETPs have gathered net inflows of US$127.5 Bn.  Equity ETFs/ETPs gathered the largest net inflows YTD with US$83.9 Bn, followed by fixed income ETFs/ETPs with US$30.1 Bn, and commodity ETFs/ETPs with US$1.5 Bn.</p> <p>Vanguard gathered the largest net ETF/ETP inflows in August with US$3.6 Bn, followed by Deutsche Bank AG (NYSE:DB) (ETR:DBK) (FRA:DB) x-trackers with US$1.4 Bn, VelocityShares with US$1.3 Bn, ProShares with US$969 Mn and Schwab ETFs with US$812 Mn net inflows.</p> <p>YTD, Vanguard gathered the largest net ETF/ETP inflows with US$49.2 Bn, followed by iShares with US$46.8 Bn, WisdomTree with US$20.8 Bn, Deutsche Bank x-trackers with US$15.9 Bn and First Trust with US$9.2 Bn in net inflows.</p> <p>This article was originally published by ValueWalk. <br /> Photo: GotCredit<br /> &nbsp;</p>
Chanos tells CNBC that Tesla and Solar City are shorts
Hedge Funds
<p>"Amazon is a great business," Jim Chanos tells CNBC Squawk Box. The founder and president of Kynikos founder says, however: "It's a lot less attractive today than it was a few years ago."</p> <p>Also in the interview, Chanos shares his views on the computer hardware business and other of his favorite shorts.</p>
Daily Scan: Stocks lose Tuesday's gains; Apple rolls out new iPad Pro
Capital Markets
<p>&nbsp;</p> <p>Stocks trimmed practically all their gains after a jobs surveyed revealed the biggest number of job openings in the 15-year-old series. According to the JOLTS report for July, released Wednesday, job openings surged to 5.75 million from 5.32 in June. Job openings are up 22% year-over-year. Quits are up 6% year-over-year and are likely to expand as workers become more confident that they can find new jobs. The good news on employment may embolden the Fed to take the gigantic, ginormous, improbable step of raising interest rates one whole quarter of a percentage point at its meeting next week. So now we know what Wall Street finds really scary: 25 basis points. The Dow closed down 1.45%. The S&amp;P 500 lost 1.4%, and the Nasdaq fell 1.15%. Oil slipped too, falling below $45/barrel.</p> <p>Here is what else you need to know:</p> <p>Hey, Siri, wassup?  Apparently, a lot. Apple revealed its new giant iPad Pro, as well as updates to the Apple Watch and the new iPhone 6s and iPhone 6s Plus. Rolling out with the super-cool $799 iPad Pro is the $99 Apple Pencil. We promise, it's way better than a No. 2. ABC News</p> <p>Died: BlackRock co-president Charles Hallac. Hallac, a 27 year BlackRock veteran, has died after a four year battle with cancer. Hallac was responsible for developing the Aladdin investment operating system for the asset manager. Reuters</p> <p>United Airlines hangar collapsed at Newark Liberty International Airport. Several workers were injured. The collapse was triggered by workers prepping the building for demolition. Talking Points Memo</p> <p>Mortgage applications drop 6.2% as refinancings dry up.  For the week ending September 4 the Mortgage Bankers Association said higher rates prompted a 10% drop in refis.  New home purchase applications rose 1% week-over-week and are 41% year-over-year. CNBC</p> <p>Hillary Clinton apologizes for using private server as Secretary of State. The Democratic candidate for president said in a televised interview: "That was a mistake. I'm sorry." Clinton has dodged apologizing and her standing in the polls has suffered. She now lags behind rival Bernie Sanders in New Hampshire. ABC</p> <p>European Commission President announces plan for 120,000 migrants. Jean-Claude Juncker is proposing a mandatory quota system that would force member countries to take in asylum seekers. BBC</p> <p>World Bank chief economist warns Fed to delay rate rise. Chief economist Kaushik Basu has warned the US Federal Reserve that it risks triggering “panic and turmoil” in emerging markets if it opts to raise rates at its September meeting and should hold fire until the global economy is on a surer footing. Financial Times (paywall)</p> <p>China leader firms up plans for US state visit. President Xi Jinping will </p>
Daily Scan: Global rally continues as U.S. stocks gain 1%; Juncker proposes solution to refugee problem
Capital Markets
<p>Is the worst behind us? Asia surged overnight again, bringing the Shanghai Composite 10% above its August low. The U.S. markets gained about 1% at the open, with the S&amp;P 500 now standing at 1988 Wednesday, continiuing a global rally. And, after days and days of speculation, we will learn Wednesday afternoon what Apple is planning for its TV and next generation of phones at its "Hey, Siri" event. Overall, look for incremental changes. Maybe a bigger iPad, a zippier phone, a new payment system. Tune in for online coverage at zillions of media outlets at 1 p.m. ET.</p> <p>Here is what else you need to know:</p> <p>Mortgage applications drop 6.2% as refinancings dry up.  For the week ending September 4 the Mortgage Bankers Association said higher rates prompted a 10% drop in refis.  New home purchase applications rose 1% week-over-week and are 41% year-over-year. CNBC</p> <p>Hillary Clinton apologizes for using private server as Secretary of State. The Democratic candidate for president said in a televised interview: "That was a mistake. I'm sorry." Clinton has dodged apologizing and her standing in the polls has suffered. She now lags behind rival Bernie Sanders in New Hampshire. ABC</p> <p>European Commission President announces plan for 120,000 migrants. Jean-Claude Juncker is proposing a mandatory quota system that would force member countries to take in asylum seekers. BBC</p> <p>Stimulus promise drives Japan's Nikkei  7.7% higher. The index is back from a seven-month low after Prime Minister Shinzo Abe told a Bank of America-Merill Lynch conference in Tokyo Wednesday that he pledged to cut corporate tax rates by a least 3.3% next year. AP</p> <p>World Bank chief economist warns Fed to delay rate rise. Chief economist Kaushik Basu has warned the US Federal Reserve that it risks triggering “panic and turmoil” in emerging markets if it opts to raise rates at its September meeting and should hold fire until the global economy is on a surer footing. Financial Times (paywall)</p> <p>Bittersweet victory for Serena. On her way to making history on the professional tennis circuit, Serena Williams needed to defeat her sister and "best friend" Venus -- which she did at the U.S. Open in three sets. ESPN</p> <p>UK suffers worst drop in exports in five years. Weak demand  and a drop in car manufactuing were behind a surge in the trade deficit to £3.4 billion pounds in July from  £2.6 billion in June. The Guardian</p> <p>Southeast Asian reserves shrinking rapidly. The lowering of the yuan's reference rate and expectations of a U.S. interest rate hike has spurred sell-offs of South Asian currencies.  From July to August, Malaysia and Indonesia saw the steepest drops in their currency reserves. Nikkei<br /> China leader firms up plans for US state visit.</p>
When secret agents go off-road: The Bentley SUV
Lifestyle, 4:01
<p>The car closely associated with British spy James Bond has had a US-style makeover - introducing Bentley's SUV, the Bentayga.</p> <p>According to Forbes magazine, the Bentayga starts at $229,100 before tax and is a more "svelte and handsome" version its ugly concept forbear. </p> <p>The car will be shown to the public for the first time at the Frankfurt Car Show this month. Sales will start in Europe, the Middle East, followed by China and US, late in the second quarter.</p> <p>For motor-heads: the sporty automobile has a  6.0 liter, 12-cylinder twin-turbo engine -  a version of which is set to appear in the Audi A8 limousine and Volkswagen Phaeton II - which takes you to 60 mph in just four seconds.</p> <p>Perfect for out-running Russian spies in an Alpine car chase.<br /> Photo: Bentley</p>
Tesco sale is Asia’s biggest private-equity Deal
Capital Markets
<p>Private-equity firm MBK Partners sealed an over $6 billion deal for U.K. retailer Tesco’s South Korea business, the biggest-ever in Asia, including debt. WSJ's Rick Carew looks at why Tesco sold and why MBK wants to own the retailer, known as Homeplus. Photo: Reuters</p> <p>This video originally appeared in the WSJ<br /> Photo: Gordon Joly</p>
Apple vs Google vs Samsung: The war for the mobile wallet
FinTech
<p>It’s on! Google and Samsung are now among the first mobile wallet providers to join MasterCard's newly launched Digital Enablement Express, a platform intended to speed up the roll-out of digital commerce.</p> <p>This comes as Apple cranks up its bank partnerships in the US and Europe ahead of today’s “Hey Siri” media event.  The war for the mobile payments supremacy is in full swing, but how do the belligerents compared?</p> <p>Apple </p> <p>Apple’s OS-based proprietary system Apply Pay allows you to pay by taping your iPhone over an NFC-enabled point-of-sale (POS) terminals. It has ready partnered with over 2,500 banks and credit card issuers, and the number is growing. But they have teething problems, Apply Pay adoption rates have been disappointing to date.</p> <p>Google</p> <p>Google’s first foray in payments - Google Wallet - will soon be discontinued,  making way for its latest offering - Android Pay- which will be launched with the Android 6.0 Marshmallow OS. It doesn’t have as many partnerships as Apple yet, but it hopes to make life harder for its rival by leveraging its one  big advantage: it works across all NFC-enabled Android devices. </p> <p>Samsung  </p> <p>The South Korean firm is a latecomer to the space but will no doubt shake things up with Samsung Pay. This system has wider coverage than its rivals because it allows users to make payments by placing their phone on, or near, magnetic stripe card readers already in wide use. So merchants do not have to install special equipment.  It has already signed up the like of Visa, MasterCard and Chase as partners.</p> <p>The other guys</p> <p>You  cannot talk about mobile payments and neglect to mention Alibaba’s AliPay or Tencent’s WeChat payments platform, both NFC-based. Focusing on China for now, these two are at each other throats but are yet to do battle with the other three. That said, they still have foothold in Asia, potentially bringing them up against Samsung, or putting a damper on any ambitions by Apple or Google to expand into China.  <br /> Photo: Thomson20192</p>
That was not a crash
Capital Markets
<p>Following the market decline of recent weeks, the most reliable valuation measures we identify now project average annual nominal returns for the S&amp;P 500 of about 0.5% in the next 10 years. On a broad range of historically reliable valuation measures (see Ockham’s Razor and the Market Cycle) the May peak in the S&amp;P 500 reached valuations averaging about 114% above run-of-the-mill historical norms – more than double the valuation levels that have historically been associated with the 10% average expected market returns that investors have enjoyed over the long-term. At present, those measures have retreated to about 92% above historical norms.<br /> Keep in mind that low interest rates don’t raise the estimated 10-year expected return on stocks from the current 0.5% level. Low interest rates only make the low expected return on stocks somewhat more “acceptable” because the alternatives are similarly dismal. The Federal Reserve’s policies of zero interest rates and quantitative easing have done nothing but to encourage yield-seeking speculation, bringing valuations to extreme levels, and leaving prospective future investment returns equally depressed.<br /> Those who assert that high equity valuations are “justified” by low interest rates are actually (and probably unknowingly) saying that 0.5% expected returns on equities over the coming decade are a-okay with them. But it’s critically important to understand that while low interest may help to explainwhy current market valuations have been driven to obscene levels, low rates do not change the relationship – the correspondence – between elevated valuation levels and dismal subsequent long-term market returns.<br /> The chart below shows the relationship between the most reliable valuation measure we identify (MarketCap/GVA) versus actual subsequent S&amp;P 500 total returns over the following decade. The current level of valuations is associated with a likely range of 10-year returns between about -3% and +4%, with an average expectation of 0.5% annually.</p> <p>The following chart shows the same data from a time-series perspective. Try the identical analysis with other popular valuation indicators and you’ll see why we rely on MarketCap/GVA and similar variants such as price/revenue, market cap/GDP and our margin-adjusted version of the Shiller P/E. We see all kinds of valuation metrics trotted out by analysts as if they’re meaningful. It’s only when investors examine the historical data (or live through the consequences of failing to do so) that they realize how little relationship many popular valuation metrics have with actual subsequent market returns. For our part, we insist on evidence. It makes us much less fun to hang around with at parties if the conversation turns toward the markets.</p> <p>Market conditions will change. Look at every market cycle in history, and you’ll see that prospective market returns have always approached 9-10% or more in every market cycle – even when interest rates were similar to current levels (prior to the mid-1960’s). The best opportunity to boost investment exposure is at points in the market cycle where a ma</p>
Nerves of steel: City bosses abseil Lloyd’s building for charity
Lifestyle, 4:01
<p>&nbsp;</p> <p>Lord Mayor Alderman Alan Yarrow led a group of 85 abseilers down the 289ft tall building façade of one of the City’s most iconic buildings to support the annual Lord Mayor’s Appeal, Finbuzz reports.</p> <p>The aim was to raise a total of £100k for a number of charities including Mencap and Scope. Charity events will continue to be held in 2015, so check out the Lord Mayor’s Appeal event calendar.</p> <p>For most participants, including Lawson Muncaster, founder and managing director of City A.M., it was their first time ever abseiling.</p> <p>. @CityAM sends founder over the edge (of the Lloyd's Building - for charity) http://t.co/oErsfh7ouypic.twitter.com/Ap3IpGjC6c<br /> — City A.M. (@CityAM) September 4, 2015<br /> No special preparation or shoes were needed, however a team of professional climbers was ready to help on the roof. Still many abseilers stalled for several minutes before stepping over the edge. Some humorously confessed that they should not have watched abseiling YouTube videos the day before.</p> <p>Despite the nerves, the Master Carman of the year Lieutenant Colonel Paul Holder RLC, who donned a Superman costume, said he never felt so confident and relaxed.</p> <p>“It is quite a lot of adrenaline, I really enjoyed it, and for a good cause,” commented Ben Fuller, Head of the Investment Trust Team at Winterflood Securities.</p> <p> The Master C</p>
Three Nomura RMBS traders indicted on charges of conspiracy, fraud
Capital Markets
<p>Three former Nomura Holdings, Inc. (ADR) (NYSE:NMR) (TYO:8604) RMBS traders have been indicted in a Connecticut federal court for swindling millions of dollars from customers while making millions themselves.</p> <p>The 10-count indictment, returned on September 3 and unsealed on Tuesday, alleges that Ross Shapiro, Michael Gramins and Tyler Peters committed conspiracy and fraud offenses while supervising the Residential Mortgage Backed Securities Desk at Nomura Securities International in New York.</p> <p>“The indictment alleges that, for several years, these three defendants handsomely profited by repeatedly lying to Nomura’s customers in violation of federal law,” said U.S. Attorney Deirdre M. Daly in a statement. “ The victims of this alleged conspiracy include numerous funds, retirement plan providers and taxpayer-provided bailout funds that helped our nation to recover from the 2008 financial crisis. Our investigation into corrupt practices in the RMBS and other financial markets continues.”</p> <p>Shapiro was the managing director who oversaw all of Nomura’s trading in RMBS, Gramins was the executive director at the RMBS desk and oversaw trading of bonds comprised of sub-prime and option ARM loans, and Peters was the senior-most vice president of the RMBS desk and focused on Nomura’s trading of bonds composed of prime and alt-A loans.<br /> Nomura RMBS Traders accused of manipulating the bond market<br /> The three are accused of orchestrating a scheme of fraud and deceit to manipulate the bond market in their own favor, resulting in losses that were passed on to investors. They allegedly inflated purchase prices at which Nomura could buy a RMBS bond to induce customers to pay higher prices and deflated prices at which Nomura could sell.</p> <p>They are also said to have trained their subordinates to lie to customers. In one instance, one of trader told a salesperson that he had “lied” about a bond price and “marked up by 2 pts,” to which the salesperson responded “haha sick ... well played.”</p> <p>The three, former Lehman Brothers Holdings Inc Plan Trust (OTCMKTS:LEHMQ) employees, face one count of conspiracy, two counts of securities fraud, and seven counts of wire fraud each. The conspiracy count carries with it a maximum term of imprisonment of five years, and the securities and wire fraud have a maximum sentence of 20 years on each count.<br /> “When investment professionals put profits before prudence and the law, it creates a dangerous environment for investors and threatens the integrity of our financial markets,” said Steven Perez, Special Agent in Charge of the Federal Housing Finance Agency Office of Inspector General, in a statement.</p> <p>The SEC also announced on Tuesday related civil fraud charges against Shapiro, Gramins and Peters.</p> <p>According to the commission’s complaint, the three generated at least $5 million in additional revenue from Nomura, and the lies and omissions by the subordinates they trained and coached generated at least $2 </p>