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December 6, 2019
SIFMA SmartBrief
News on the capital markets
Morning Bell
SIFMA's Bentsen: Liability issues still unresolved on CAT
As an April launch of the Securities and Exchange Commission's consolidated audit trail nears, SIFMA President and CEO Kenneth E. Bentsen, Jr. says liability remains a point of contention. Under the proposed structure, firms that report to CAT are effectively held responsible in the event of a security breach, Bentsen says, and "that means all the legal, monetary and reputational liability falls directly on the firms when they have to turn over their clients' data to which they're compelled to do."
Politico Pro (subscription required) (12/5) 
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Are You Confident in Your Fixed Income Reference Data?
Our reference data covers approximately 15 million active and non-active global fixed income instruments.1 Fuel front, middle and back office functions with market-leading reference data. Learn more.

1 As of August 2019
Happening Today
Industry News
SIFMA economic survey: 2020 recession unlikely
Highlights from the 2019 End-Year US Economic Survey from SIFMA, which gathers input from a roundtable of chief economists at member firms, include little expectation of a recession or changes to Federal Reserve monetary policy, a marginal inflation rise toward the Fed target and a "phase one" trade agreement between the US and China in 2020. However, economic growth projections have been adjusted slightly downward, with slowing global growth and US political uncertainty cited as factors.
ThinkAdvisor (free registration) (12/5) 
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Saudi Aramco raises record $25.6B in IPO
Saudi Aramco has raised $25.6 billion in the world's biggest initial public offering. The IPO gave Aramco a valuation of $1.7 trillion, less than the $2 trillion Saudi Crown Prince Mohammed bin Salman had wanted.
Reuters (12/5),  Arab News (Saudi Arabia) (12/6),  BNN Bloomberg (Canada) (12/5) 
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Economists expect positive Nov. jobs report
A survey of economists shows broad expectation the November employment report from the US Labor Department will show good economic health, with jobs added and historically low unemployment.
The Wall Street Journal (tiered subscription model) (12/6) 
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Twitter bond offering met with strong demand
Demand for a Twitter bond was so high the company expanded the offering to $700 million from $600 million and lowered the yield to 3.875% from about 4%. The debt was rated BB+ by S&P Global Ratings, one step below investment grade.
MarketWatch (12/5),  The Wall Street Journal (tiered subscription model) (12/5) 
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Washington Roundup
SIFMA CEO raises concern about SEC broker exemption order
SIFMA President and CEO Kenneth E. Bentsen, Jr. has expressed concern about the Securities and Exchange Commission's proposal to exempt broker-dealer registration for municipal advisors working on private-placement deals, thus letting registered municipal advisors perform some roles in private placement of bonds, which dealer firms view as their remit. "We have strong concerns," Bentsen said at SIFMA's State of the Industry briefing. "We think that the SEC is going down the wrong path with that."
The Bond Buyer (subscription required) (12/5) 
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Treasury, Fed collaborate to combat repo-market issues
Treasury Secretary Steven Mnuchin says he is working with Federal Reserve Chairman Jerome Powell to ensure liquidity in the repurchase market, because the Fed has had to inject cash several times since September to steady the market. "We've talked in our weekly meeting [about] making sure the Fed is prepared for year-end activity so there are ample reserves," Mnuchin told the House Financial Services Committee.
The Wall Street Journal (tiered subscription model) (12/5) 
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Former Fed official: Liquidity rules need careful handling
Former Federal Reserve regulatory chief Daniel Tarullo says the Fed needs to carefully assess liquidity rules as they apply to banks to avoid nullification of the objective. Tarullo acknowledges a need for banks to maintain enough funds to protect themselves in the event of a crisis but says sitting on liquidity in anticipation of potential failure could strain the financial system.
Politico Pro (subscription required) (12/6) 
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States should defer to SEC's Reg BI
SIFMA President and CEO Kenneth E. Bentsen, Jr. has reiterated the group's stance against individual states implementing their own fiduciary rules. Repeating his point the move would lead to "a patchwork of rules," Bentsen says it would also cause brokers to close brokerage accounts and offer advisory services only, eliminating client choice. "Clients will have one choice they can buy, which in many cases will be buying more services than they wanted and having to pay more than they wanted to," he says.
InvestmentNews (tiered subscription model) (12/5) 
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SIFMA: Rule changes for funds, swaps market are 2020 priorities
Changes to the Volcker rule affecting covered funds and swaps market regulation are among SIFMA's top regulatory priorities in 2020, President and CEO Kenneth E. Bentsen, Jr. said at SIFMA's State of the Industry briefing. "If you were to put together sort of a band of rules that really are important that need to get done, you need to get the Volcker funds rule done because that lays out there," he said. "You need to close the book on Title VII and getting those rules out there, and they're in the process of doing those as well."
Politico Pro (subscription required) (12/5) 
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Global Update
US-Chinese trade continues to decrease
Trade between the US and China continued to decline in October. Imports from China fell 4.8% compared with September, while exports to China plunged 17%, according to the US Commerce Department.
BNN Bloomberg (Canada) (12/5) 
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Oil-producing nations to further cut output
OPEC members and other oil-producing countries have agreed to reduce production by an additional 500,000 barrels per day, bringing the total to 1.7 million barrels per day, until the end of the first quarter, Russian Energy Minister Alexander Novak says. "We really do see some risks of oversupply in the first quarter due to lower seasonal demand for refined products and for crude oil," he says.
Reuters (12/5) 
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Early bird rates available for SIFMA's 2020 Private Client Conference
SIFMA's Private Client Conference brings together leaders from across private wealth management to examine the most topical issues facing the business. This comprehensive program focuses on financial advice amidst rapidly changing technology, regulations and investor demographics. Register today to join us on May 13-15 in Florida.
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SOFR Primer, by SIFMA Insights
The publication of LIBOR is not guaranteed beyond 2021. Much work lies ahead in order to implement a successful reference rate change, and time is of the essence. In this primer, published as we gather for a LIBOR Transition Briefing with policymakers at the center of the transition, SIFMA Insights provides an overview of the LIBOR transition -- as well as an actionable checklist -- with a focus on the proposed US alternative reference rate, Secured Overnight Financing Rate (SOFR).
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D&I in Financial Services: A Deep Dive
Given the wholehearted acknowledgment that building and maintaining a diverse and inclusive workforce and industry is imperative, hear from financial-services leaders on what specifically they're doing at their firms to achieve and measure progress in this area.
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