Connect with us

ICE CEO On NYSE Delisting Three Chinese Stocks

CNBC Exclusive: CNBC Transcript: Intercontinental Exchange Chairman & CEO Jeffrey Sprecher and Bakkt CEO Gavin Michael Speak with CNBC’s “Squawk on the Street” today about the NYSE delisting three Chinese stocks. Q3 2020 hedge fund letters,…

Published

3 years ago

on

NYSE Delisting Chinese Stocks Intercontinental Exchange Chairman & CEO Jeffrey Sprecher

CNBC Exclusive: CNBC Transcript: Intercontinental Exchange Chairman & CEO Jeffrey Sprecher and Bakkt CEO Gavin Michael Speak with CNBC’s “Squawk on the Street” today about the NYSE delisting three Chinese stocks.

Get The Full Warren Buffett Series in PDF

Get the entire 10-part series on Warren Buffett in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues

Warren Buffett eBook

Q3 2020 hedge fund letters, conferences and more

 

Intercontinental Exchange CEO On NYSE Delisting Three Chinese Stocks

 

JIM CRAMER: Here's some exciting news back, and that's Bakkt a digital asset marketplace founded by the Intercontinental Exchange and they own the NYSE, the New York Stock Exchange stock says it's becoming a publicly traded company, via a  merger with the SPAC  VPC impact acquisition holdings. Joining us now in a CNBC exclusive is Jeffrey Sprecher Intercontinental Exchange Chairman and CEO, as well as Gavin Michael the CEO of Bakkt itself. Welcome, gentlemen, good to see you.

JEFFREY SPRECHER: Thank you, Jim.

CRAMER: So Jeff. This is the most exciting area of the market right now we know that because crypto currencies, we're all looking for any way to so called play it whether it be the actual crypto itself or whether it be if there's a dearth I mean Square PayPal. Will this be the direct way, if you want to invest in the concept of cryptocurrency.

SPRECHER: I think it's even bigger than that Jim, we, we got into this business because we were interested in the blockchain we were interested in what was going on in the crypto space and so years ago, we started back as a real venture back company within our firm, but as we got into it, we started to see there are all kinds of digital assets, beyond cryptocurrencies that you and I deal with, we have airline miles and rental car miles reward points we have restaurant points and points from coffee companies and all kinds of merchants that are that are rewarding us in different ways. And we started to think what if we could create essentially a wallet. A depository institution where you could put all of those assets in one place. And then, because we're an exchange underneath it, we could trade back and forth so that you can convert one set of rewards to another set of rewards and use them for spending,

CRAMER: candidly I didn't know how big this division was. I didn't know all the affinity programs, but if I want to own Intercontinental Exchange. Don’t I want all this back business I mean, to me it's very, very exciting.

SPRECHER: Thank you. I hope you do an intercontinental exchange, by the way. And you and I can talk offline. But, no you know one of the things that my job and the job of the management team here is to create value for shareholders, and we have this great little company inside of us. And I don't think it was being recognized or rewarded by our own investors and. And so we said to ourselves this great vehicle now that the markets have created that we've helped contribute to call the SPAC might be the perfect vehicle to give more exposure to Bakkt so that people could make a direct investment in it. But bear in mind that once we do this transaction will still be the majority partner intercontinental exchange will still have exposure to the value inside of BAKKT

CRAMER: Right that may be an alternative way to play for people who are a little more conservative Gavin Michael let me bring you in Bakkt CEO. It's interesting Gavin your background is of course it's Citibank but you were the former head of technology. So what do you bring to the equation if you had that kind of experience to Citi.

GAVIN MICHAEL: Good morning. Thanks to real understanding not just how technology operates and how we scale the venture, like Bakkt to meet the demand that we expect, but also a real understanding of what the changing consumer landscape looks like how customers expectations are rising and how we use digital means to meet and exceed those expectations

CRAMER: market for Bitcoin as we saw this weekend. Is it all orderly Can you bring some order to the market. My experience with Bitcoin is is the weekend is just the Wild West and you shouldn't even think about doing it. Are you going to be in it 24/7.

MICHAEL: Absolutely. It has to be 24/7 Jim, but what do you think about is we uniquely bring together customer loyalty I mean think about how you've considered loyalty today loyalty today looks like a set of cards. We're putting it on the phone we're allowing you to accelerate the shift to digital assets and payments we're empowering you to use your digital assets for everyday spending. Think about buying your morning cup of coffee at Starbucks using unused airline points or using Bitcoin. That's what our app enables our app enables customers to convert their digital assets in entirely new ways,

CRAMER: When I see NFL players asked to be paid in Bitcoin. I wonder why the heck, we're not being paid a little bit Bitcoin, Jeff, let me ask you something treasury secretary Steve Mnuchin, he called the New York Stock Exchange President Stacey Cunningham who is well known on our network to object to the, to the New York Stock Exchange’s view of what to do with China's securities. Is it the role of the government to tell you what to do.

SPRECHER: Well, the New York Stock Exchange is a very highly regulated company and, and we're navigating, like many companies, how we deal abroad, and we've got, you know the President's actions going on we have Congress has passed some legislation, we have the accounting standards boards are looking at China, we have the FCC that directly oversees us that's looking at the securities, and in that amalgamation we're trying to navigate to do the right thing for this country and for the markets and, and they've definitely been complicated, just much like the China strategy of the country. what I will say this to Jim you know this because you go into that building. We wrap, an American flag around that building. And we do that purposely and we are uniquely American, and we want to export the best things about this country abroad, but we want to do it in a way that is best for our country. And that's what you're seeing us trying to navigate right now.

CRAMER: And you know I believe in that and have for 35 years. But I am confused. I don't really know what's best for the country. Do we want those Chinese companies raising capital on our country or do we want to shut them down? What is the right flag way to deal with this situation?

SPRECHER: Yeah, it’s interesting and I’ve thought a lot about it. I'm sure you have too which is, as a society, the United States has always wanted to help the downtrodden no matter what country they're in. We want to help people get ahead. It's one of the things that we uniquely export – is our giving and our big hearts. On the other hand, as people rise up, we don't want them to turn against us. And so there has to be some balance in there. And that's what I think we're looking for is how do we help the rest of the world for the benefit of our own people, and then how do we make sure that the rest of the world respects what we've just done.

That is not a seamless process, but I will tell you that the New York Stock Exchange was there during the Civil War, during World War One, World War Two, Korean War, Vietnam War, and continues to put that flag in front of the building. So I'm confident that we'll figure out how to muddle through this.

CARL QUINTANILLA: Jeffrey, I mean you're pointing to the exact right issue, and your bit about being uniquely American is so well taken. I go into the building too. I mean let's be more direct. What needs to be the response to the President and his speech prior to the attack on the Capitol, the legislators who tried to challenge the count, the protesters, the rioters themselves – how firm of a stance will you take?

SPRECHER: I'm confident that we're going to wrap that building in the American flag that I can tell you. I know we will survive this. This company was formed when the United States was formed. The very first listing we had was the Bank of New York, which was Alexander Hamilton's bank, and the very first loan that they made was to pay the salaries of Congress. So, this institution is the United States if we represent everything that's good about the United States and notwithstanding the fact that we're going through an internal debate, I'm confident to the outside world that we’ll represent everything that's good about our country.

QUINTANILLA: Will you comment at all on the President's actions?

SPRECHER: No. You know, I think, as you started at the top of the show, the capital markets are doing phenomenally well. The capital markets, which are forward looking, are saying this is all going to work out. There are better times ahead. And you can see it in the collective stock prices of our markets. So I have confidence in those markets that we run. And you know, I’m very positive about what's going on in the future.

CRAMER: Okay so Jeffrey, obviously, so much going on in Georgia itself. I thought it was really interesting that your wife, Senator Kelly Loeffler of course, was the first CEO of Bakkt. I also know that she was kind of caught up in this controversy – maybe it's not a controversy or some people think it is – about trading stocks as a senator. And I struggle – I don't know what the right thing to do is. I mean, do we just say from now on senators can't do anything with stocks? Like I'm allowed to, I'm not allowed to or is it just look, just as long as there's sunlight and there's disinfectant, you can make your own judgment? Again, not sure what the right thing to do is Jeffrey.

SPRECHER: Yeah. Thanks for asking me. You know, what's been crazy about that narrative is that because I'm the Chairman of the New York Stock Exchange and because Kelly was the head of marketing for the New York Stock Exchange, we're actually prohibited from trading stocks. And we don't even have a brokerage account that allows us to direct stock trading activity. So, when we made a disclosure of all of the mutual funds and managed accounts that others are running for us, somehow, you know, the narrative in the politics was that we were insider trading. Which the reality is, she is the one senator that is actually prohibited from trading any stocks.

CRAMER: Well I am glad I asked you that because I think that has not been the narrative. One narrative that I want to go with that I think it's incredibly positive – I think you do too – younger investors getting in. Now here we can use the moniker Robinhood. But aren't you just astonished that so many people want in after a long period where young people seem to almost object to capitalism and stocks?

SPRECHER: It's one of the most amazing trends of 2020. And, you know, a combination of digital literacy by young people coupled with the pandemic that kept people at home, caused people to think about, you know, the investment market as a vehicle for entertainment and for wealth creation when they weren't working. And that combination has just taken our markets to new heights. I've talked to a lot of very senior people on Wall Street and I believe it's a trend that is not going to go away. In other words, we have created a generation of young people that are in the markets that we think over their lifetime will stay invested in the markets.

CRAMER: Gavin, some thoughts.

MICHAEL: So I think, you know, as you take that retailization of the market into account, we're helping consumers realize value that they have in assets that perhaps they didn't know that they held. You know, digital assets like loyalty points have no real value to a customer if they can't expand them in a variety of ways. And that's what Bakkt is bringing to this new generation, to these emerging customer segments, and that's what's so exciting about the proposition that we're talking about this morning.

CRAMER: Boy, I've got to tell you, for those who want to find a way to be able to invest in crypto and invest in points, invest in everything digital, we may have found it. I want to thank so much to Gavin Michaels, who's Bakkt CEO. And I also, of course want to thank our old friend Jeffrey Sprecher Intercontinental Exchange Chairman and CEO. Gentlemen, thank you so much for coming on “Squawk on the Street.”

The post ICE CEO On NYSE Delisting Three Chinese Stocks appeared first on ValueWalk.

Read More

Related Topics:
Continue Reading

Uncategorized

Industrial Production Increased 0.1% in February

From the Fed: Industrial Production and Capacity Utilization
Industrial production edged up 0.1 percent in February after declining 0.5 percent in January. In February, the output of manufacturing rose 0.8 percent and the index for mining climbed 2.2 p…

Published

58 mins ago

on

March 15, 2024

By

From the Fed: Industrial Production and Capacity Utilization
Industrial production edged up 0.1 percent in February after declining 0.5 percent in January. In February, the output of manufacturing rose 0.8 percent and the index for mining climbed 2.2 percent. Both gains partly reflected recoveries from weather-related declines in January. The index for utilities fell 7.5 percent in February because of warmer-than-typical temperatures. At 102.3 percent of its 2017 average, total industrial production in February was 0.2 percent below its year-earlier level. Capacity utilization for the industrial sector remained at 78.3 percent in February, a rate that is 1.3 percentage points below its long-run (1972–2023) average.
emphasis added
Capacity UtilizationClick on graph for larger image.

This graph shows Capacity Utilization. This series is up from the record low set in April 2020, and above the level in February 2020 (pre-pandemic).

Capacity utilization at 78.3% is 1.3% below the average from 1972 to 2022.  This was below consensus expectations.

Note: y-axis doesn't start at zero to better show the change.


Industrial Production The second graph shows industrial production since 1967.

Industrial production increased to 102.3. This is above the pre-pandemic level.

Industrial production was above consensus expectations.

Read More

Continue Reading

International

Fuel poverty in England is probably 2.5 times higher than government statistics show

The top 40% most energy efficient homes aren’t counted as being in fuel poverty, no matter what their bills or income are.

Published

59 mins ago

on

March 15, 2024

By

Julian Hochgesang|Unsplash

The cap set on how much UK energy suppliers can charge for domestic gas and electricity is set to fall by 15% from April 1 2024. Despite this, prices remain shockingly high. The average household energy bill in 2023 was £2,592 a year, dwarfing the pre-pandemic average of £1,308 in 2019.

The term “fuel poverty” refers to a household’s ability to afford the energy required to maintain adequate warmth and the use of other essential appliances. Quite how it is measured varies from country to country. In England, the government uses what is known as the low income low energy efficiency (Lilee) indicator.

Since energy costs started rising sharply in 2021, UK households’ spending powers have plummeted. It would be reasonable to assume that these increasingly hostile economic conditions have caused fuel poverty rates to rise.

However, according to the Lilee fuel poverty metric, in England there have only been modest changes in fuel poverty incidence year on year. In fact, government statistics show a slight decrease in the nationwide rate, from 13.2% in 2020 to 13.0% in 2023.

Our recent study suggests that these figures are incorrect. We estimate the rate of fuel poverty in England to be around 2.5 times higher than what the government’s statistics show, because the criteria underpinning the Lilee estimation process leaves out a large number of financially vulnerable households which, in reality, are unable to afford and maintain adequate warmth.

Blocks of flats in London.
Household fuel poverty in England is calculated on the basis of the energy efficiency of the home. Igor Sporynin|Unsplash

Energy security

In 2022, we undertook an in-depth analysis of Lilee fuel poverty in Greater London. First, we combined fuel poverty, housing and employment data to provide an estimate of vulnerable homes which are omitted from Lilee statistics.

We also surveyed 2,886 residents of Greater London about their experiences of fuel poverty during the winter of 2022. We wanted to gauge energy security, which refers to a type of self-reported fuel poverty. Both parts of the study aimed to demonstrate the potential flaws of the Lilee definition.

Introduced in 2019, the Lilee metric considers a household to be “fuel poor” if it meets two criteria. First, after accounting for energy expenses, its income must fall below the poverty line (which is 60% of median income).

Second, the property must have an energy performance certificate (EPC) rating of D–G (the lowest four ratings). The government’s apparent logic for the Lilee metric is to quicken the net-zero transition of the housing sector.

In Sustainable Warmth, the policy paper that defined the Lilee approach, the government says that EPC A–C-rated homes “will not significantly benefit from energy-efficiency measures”. Hence, the focus on fuel poverty in D–G-rated properties.

Generally speaking, EPC A–C-rated homes (those with the highest three ratings) are considered energy efficient, while D–G-rated homes are deemed inefficient. The problem with how Lilee fuel poverty is measured is that the process assumes that EPC A–C-rated homes are too “energy efficient” to be considered fuel poor: the main focus of the fuel poverty assessment is a characteristic of the property, not the occupant’s financial situation.

In other words, by this metric, anyone living in an energy-efficient home cannot be considered to be in fuel poverty, no matter their financial situation. There is an obvious flaw here.

Around 40% of homes in England have an EPC rating of A–C. According to the Lilee definition, none of these homes can or ever will be classed as fuel poor. Even though energy prices are going through the roof, a single-parent household with dependent children whose only income is universal credit (or some other form of benefits) will still not be considered to be living in fuel poverty if their home is rated A-C.

The lack of protection afforded to these households against an extremely volatile energy market is highly concerning.

In our study, we estimate that 4.4% of London’s homes are rated A-C and also financially vulnerable. That is around 171,091 households, which are currently omitted by the Lilee metric but remain highly likely to be unable to afford adequate energy.

In most other European nations, what is known as the 10% indicator is used to gauge fuel poverty. This metric, which was also used in England from the 1990s until the mid 2010s, considers a home to be fuel poor if more than 10% of income is spent on energy. Here, the main focus of the fuel poverty assessment is the occupant’s financial situation, not the property.

Were such alternative fuel poverty metrics to be employed, a significant portion of those 171,091 households in London would almost certainly qualify as fuel poor.

This is confirmed by the findings of our survey. Our data shows that 28.2% of the 2,886 people who responded were “energy insecure”. This includes being unable to afford energy, making involuntary spending trade-offs between food and energy, and falling behind on energy payments.

Worryingly, we found that the rate of energy insecurity in the survey sample is around 2.5 times higher than the official rate of fuel poverty in London (11.5%), as assessed according to the Lilee metric.

It is likely that this figure can be extrapolated for the rest of England. If anything, energy insecurity may be even higher in other regions, given that Londoners tend to have higher-than-average household income.

The UK government is wrongly omitting hundreds of thousands of English households from fuel poverty statistics. Without a more accurate measure, vulnerable households will continue to be overlooked and not get the assistance they desperately need to stay warm.

The Conversation

Torran Semple receives funding from Engineering and Physical Sciences Research Council (EPSRC) grant EP/S023305/1.

John Harvey does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

Read More

Continue Reading

Uncategorized

Southwest and United Airlines have bad news for passengers

Both airlines are facing the same problem, one that could lead to higher airfares and fewer flight options.

Published

2 hours ago

on

March 15, 2024

By

Airlines operate in a market that's dictated by supply and demand: If more people want to fly a specific route than there are available seats, then tickets on those flights cost more.

That makes scheduling and predicting demand a huge part of maximizing revenue for airlines. There are, however, numerous factors that go into how airlines decide which flights to put on the schedule.

Related: Major airline faces Chapter 11 bankruptcy concerns

Every airport has only a certain number of gates, flight slots and runway capacity, limiting carriers' flexibility. That's why during times of high demand — like flights to Las Vegas during Super Bowl week — do not usually translate to airlines sending more planes to and from that destination.

Airlines generally do try to add capacity every year. That's become challenging as Boeing has struggled to keep up with demand for new airplanes. If you can't add airplanes, you can't grow your business. That's caused problems for the entire industry. 

Every airline retires planes each year. In general, those get replaced by newer, better models that offer more efficiency and, in most cases, better passenger amenities. 

If an airline can't get the planes it had hoped to add to its fleet in a given year, it can face capacity problems. And it's a problem that both Southwest Airlines (LUV) and United Airlines have addressed in a way that's inevitable but bad for passengers. 

Southwest Airlines has not been able to get the airplanes it had hoped to.

Image source: Kevin Dietsch/Getty Images

Southwest slows down its pilot hiring

In 2023, Southwest made a huge push to hire pilots. The airline lost thousands of pilots to retirement during the covid pandemic and it needed to replace them in order to build back to its 2019 capacity.

The airline successfully did that but will not continue that trend in 2024.

"Southwest plans to hire approximately 350 pilots this year, and no new-hire classes are scheduled after this month," Travel Weekly reported. "Last year, Southwest hired 1,916 pilots, according to pilot recruitment advisory firm Future & Active Pilot Advisors. The airline hired 1,140 pilots in 2022." 

The slowdown in hiring directly relates to the airline expecting to grow capacity only in the low-single-digits percent in 2024.

"Moving into 2024, there is continued uncertainty around the timing of expected Boeing deliveries and the certification of the Max 7 aircraft. Our fleet plans remain nimble and currently differs from our contractual order book with Boeing," Southwest Airlines Chief Financial Officer Tammy Romo said during the airline's fourth-quarter-earnings call. 

"We are planning for 79 aircraft deliveries this year and expect to retire roughly 45 700 and 4 800, resulting in a net expected increase of 30 aircraft this year."

That's very modest growth, which should not be enough of an increase in capacity to lower prices in any significant way.

United Airlines pauses pilot hiring

Boeing's  (BA)  struggles have had wide impact across the industry. United Airlines has also said it was going to pause hiring new pilots through the end of May.

United  (UAL)  Fight Operations Vice President Marc Champion explained the situation in a memo to the airline's staff.

"As you know, United has hundreds of new planes on order, and while we remain on path to be the fastest-growing airline in the industry, we just won't grow as fast as we thought we would in 2024 due to continued delays at Boeing," he said.

"For example, we had contractual deliveries for 80 Max 10s this year alone, but those aircraft aren't even certified yet, and it's impossible to know when they will arrive." 

That's another blow to consumers hoping that multiple major carriers would grow capacity, putting pressure on fares. Until Boeing can get back on track, it's unlikely that competition between the large airlines will lead to lower fares.  

In fact, it's possible that consumer demand will grow more than airline capacity which could push prices higher.

Related: Veteran fund manager picks favorite stocks for 2024

Read More

Continue Reading

Trending