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The Pandemic of Ponzimonium”-Speech of Commissioner Bart Chilton
to the New York Law School, Center on Financial Services Law
November 15, 2011-Introduction
It is an honor and pleasure to be here with you this afternoon. Thanks particularly to Professor Ron Filler for his extraordinary efforts in setting this up.
Biosafety Levels
There is a fairly recent movie out called “Contagion.” Steven Soderbergh directed the film which has a large ensemble cast including Matt Damon, Jude Law, Gwyneth Paltrow and Kate Winslet, among others. I haven’t seen the movie, but it follows the progress of a virus that results in a pandemic. The movie sounds similar to a book I read over a dozen years ago—pre-9/11—called “The Cobra Event.” It’s a thriller and this single man, a terrorist, creates an incurable virus called “Cobra” that is a combination of smallpox and the common cold. The story starts right here in New York and a pandemic ensues.
The thing is—the theoretical possibility of such pandemics as Contagion and Cobra Event seem all too close to home.
When I worked at the United States Department of Agriculture around the same time I read Cobra Event, I became familiar with biosafety levels—or BSL—and the facilities that exist to contain these deadly things and to do research to find a vaccine or antidote. At the time, there were four BSL tiers, ranging from a biosafety level 1 which were facilities where the staff would isolate whatever it was they were trying to contain and they’d use some minimal protective garments. The BSL tiers became progressively more secure through BSL 4. A BSL 4 was reserved for dealing with pathogens and lethal agents—like smallpox, cholera, measles, etc…—exceptionally dangerous and infectious materials that if released could become pandemics. A BSL 4 is a super secure facility for dealing with these things. Staff wears what are essentially space suits with hoods. The buildings have self-contained oxygen and the air is all internally filtered. The entrance and exits have multiple showers, a vacuum room, ultraviolet rooms and a bunch of other safety precautions. Let’s just say it is pretty secure because it handles the most dangerous stuff on earth—things that could become pandemic. And guess what? There is a facility a mile and a half off of Long’s Island’s Orient Point. It is called Plum Island and it is 840 acres. It is, or at least it was, the only BSL 4 facility authorized to handle diseases that are communicable between humans and animals for which there is no known cure.
read more
Source: CFTC.gov
Morgan Stanley-HOLDRS Conversion
November 15, 2011--Van Eck to Convert
HOLDRS Into ETFs Synopsis:
Van Eck Global has filed documents with the Securities and Exchange Commission offering investors of six HOLDRS the opportunity to
exchange their receipts in HOLDRS trusts for shares of new Market Vectors exchangetraded funds (ETFs).
The exchange will be of equal value and
require action on the part of individual
HOLDRS investors authorizing conversion into the new Market Vectors ETFs. According to Van Eck, investors in the six affected HOLDRS can expect to receive an information
package shortly.
Trading in the six HOLDRS will be halted 30 minutes prior to the expiration of Van Eck’s exchange offers on 12/20/11, unless the offers are extended. The trustee is expected to liquidate the HOLDRS approximately four months after the termination of the trusts, which will occur following the expiration of the exchange offers.
Following the expiration of the exchange offers, the six HOLDRS will no longer trade on a national securities exchange, potentially making it difficult for investors who did not participate in the exchange to sell their shares.
Trading in the new ETFs is expected to begin on the first trading day immediately following the expiration of the exchange offers.
It is likely that the remaining 11 HOLDRS that are not part of the Van Eck exchange offering will be liquidated.
request report
Source: Morgan Stanley
Highland Capital Management, L.P. files with the SEC
October 15, 2011--Highland Capital Management, L.P. has filed a
fourth amended and restated application for exemptive relief with the SEC.
view filing
Source: SEC.gov
Gold hit as Paulson cuts ETF holding
November 15, 2011--Gold prices dropped as much as 1.1 per cent on Tuesday on news that John Paulson, the world’s most prominent gold bull, had cut his holdings in a popular gold exchange-traded fund during the third quarter.
Mr Paulson sold a third of his holdings in the SPDR Gold Trust in the third quarter, according to a regulatory filing released late on Monday. Nonetheless, his $30bn hedge fund was still the largest holder of the ETF at the end of September, with a stake worth about $3.5bn at current prices.
read more
Source: FT.com
Attention ETF Traders and Investors, United States Commodity Funds LLC Launches the United States Copper Index Fund (CPER)
November 15, 2011--United States Commodity Funds LLC, a sponsor of exchange traded commodity funds, listed for trading on the New York Stock Exchange Arca a new exchange traded commodity index fund, United States Copper Index Fund, under the ticker "CPER".
The United States Copper Index Fund (CPER) is an exchange traded product ("ETP") that seeks to reflect the performance of a portfolio of copper futures contracts fully collateralized with 3-month U.S. Treasury Bills. The investment objective of CPER is for the daily changes in percentage terms of its units' net asset value ("NAV") to reflect the daily changes in percentage terms of the SummerHaven Copper Index, less CPER's expenses. CPER issued units may be purchased and sold on the NYSE Arca.
United States Copper Index Fund's target is a portfolio of copper futures contracts designed to be an investment benchmark for copper as an asset class. The Copper Index is composed of copper futures contracts on the Comex exchange. The Copper Index attempts to maximize backwardation and minimize contango while using contracts in the liquid portions of the futures curve.
view more
Source: United States Commodity Funds LLC
Global X Funds Launches First Social Media ETF
November 15, 2011 – Global X Funds, the New York based provider of exchange traded funds, today launched the Global X Social Media Index ETF (NASDAQ Ticker: SOCL), the first ETF globally to focus on social media companies.
The social media industry continues to grow rapidly, providing new ways for people to connect, share, shop, create and network.
The Global X Social Media Index ETF attempts to capture this global industry in a single ETF, and includes companies from all over the world that provide social networking, file sharing, and other web-based media applications.
User growth in social media has skyrocketed; a Pew Research Center survey says that in 2011 approximately 65% of adult internet users said that they use a social networking site, which is nearly double the percentage that reported social network usage in 2008. An increase in mobile phone usage has further propelled social media, with nearly 40% of social media users accessing such content directly from their mobile phones (Nielsen, 2011). Not only are individual users tapped into this phenomenon, but approximately 84% of Fortune 100 companies utilize branded social media channels, while nearly 81% of the top Asian companies have expanded into branded social media channels, according to a 2011 study conducted by Burson-Marsteller. In the U.S. social media use by small businesses has grown to include nearly one out of every three businesses, demonstrating rapid growth with room for further expansion (Network Solutions, 2011).
rad more
Source: Global X
Morgan Stanley-ETF Weekly Update
November 14, 2011--Exchange-Traded Funds
US ETF Weekly Update-Highlights
Weekly Flows: $4.2 Billion Net Inflows
ETF Assets Stand at $1.1 Trillion, up 7% YTD
Launches: 2 New ETFs
Van Eck Announces Commencement of HOLDRS
Exchange Offer
US-Listed ETFs: Estimated Flows by Market Segment
ETFs posted net inflows of $4.2 bln last week; flows have fluctuated recently
Last week’s net inflows were led by Commodity ETFs, specifically the largest gold ETF
ETF assets stand at $1.1 tln, up 7% YTD (due to net inflows)
13-week flows were mostly positive among asset classes; combined $43.4 bln net inflows
Fixed Income ETFs have exhibited the greatest net inflows the past 13 weeks ($15.7 bln net inflows)
We estimate ETFs have generated net inflows 27 out of 45 weeks in 2011; net inflows of $99.2 bln YTD
US-Listed ETFs: Estimated Largest Flows by Individual ETF
SPDR Gold Trust (GLD) posted net inflows of $1.4 bln last week, the most of any ETF
Amid market volatility and European uncertainty, investors flocked to GLD last week; despite last week’s net
inflows GLD has exhibited net inflows of only $23 mln YTD
8 out of the 10 ETFs to post the largest net outflows last week were US-equity ETFs
US-Listed ETFs: Change in Short Interest
Data Updated: Based on data as of 10/31/11
QQQ exhibited the largest increase in USD short interest since last updated
$498 million in additional short interest
QQQ’s shares short remain near their high over the past year
IWM exhibited the largest decline in USD short interest since last updated
$1.7 billion in reduced short interest
Shares short for IWM have been drifting lower the past two periods
US-Listed ETFs: Most Successful Recent Launches by Assets Source: Bloomberg, Morgan Stanley Smith Barney Research. Data estimated as of 11/11/11 based on daily change in share counts and daily NAVs.
$6.8 billion in total market cap of ETFs less than 1 year old
Over past 13 weeks, newly launched Fixed Income ETFs generated most net inflows ($513 mln)
215 new ETF listings and 9 liquidations YTD
Newly issued defensive portfolios have been successful in garnering assets
Top 10 account for $3.2 bln in market cap and posted net inflows of $1.1 bln over last 13 weeks
PowerShares S&P 500 Low Volatility Portfolio (SPLV) and iShares High Dividend Equity Fund (HDV)
have been two standout launches over the past year
request report
Source: Morgan Stanley
ETRACS MLPI ETN continues to be the top performing exchange traded product tracking the Alerian MLP Infrastructure Index
November 14, 2011--UBS Investment Bank today announced that the ETRACS Alerian MLP Infrastructure ETN (Ticker: MLPI) was the top performing exchange-traded product linked to the Alerian MLP
Infrastructure Index (Ticker: AMZI) for the month of October 2011.
Both MLPI and the Alerian MLP ETF (Ticker: AMLP) are designed to deliver the performance of the Alerian MLP
Infrastructure Index (the “Index”). The table below summarizes their performance during the month of October 2011 and year-to-date:
read more
Source: UBS
ProShares files with the SEC
November 14, 2011--ProShares has filed a post-effective amendment, registration statement with the SEC for the ProShares Sovereign Fiscal Strength ETF.
view filing
Source: SEC.gov
MarketShares files with the SEC
November 14, 2011--MarketShares has filed an application for exemptive relief with the SEC for actively-managed ETFs.
view filing
Source: SEC.gov
