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H.R. 1187, ESG Disclosure Simplification Act of 2021
June 10, 2021--Summary
H.R. 1187 would require the Securities and Exchange Commission (SEC) to issue rules that define environmental, social, and governance (ESG) metrics and would require publicly traded companies to disclose and describe how those metrics affect their business strategy to shareholders and the SEC annually. Under the bill, the SEC would establish a permanent advisory committee, composed of up to 20 members, to advise the agency on sustainable finance issues.
Using information from the SEC, CBO estimates that implementing H.R. 1187 would cost $6 million over the 2021-2026 period for the SEC to issue rules and support the advisory committee. However, because the SEC is authorized to collect fees each year to offset its annual appropriation, CBO expects that the net effect over the 2021-2026 period would be negligible, assuming appropriation actions consistent with that authority.
By requiring publicly traded companies to disclose ESG metrics to the SEC and shareholders, H.R. 1187 would impose a private-sector mandate as defined in the Unfunded Mandates Reform Act (UMRA).
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Source: cbo.gov
BRIEF-U.S. Financial Regulator Warns Against Strict Cryptocurrency Rules
Jun 9, 2021--A senior US monetary regulator has spoken out in opposition to makes an attempt by her colleagues to manage cryptocurrencies extra strictly, warning that doing so runs the chance of discouraging traders.
Hester Peirce, one among two Republicans among the many 5 commissioners on the Securities and Alternate Fee, informed the Monetary Instances she was anxious in regards to the push by a number of US regulators to play a extra energetic function within the $1.5tn cryptocurrency market
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Source: reuters.com
El Salvador becomes first country to adopt bitcoin as legal tender
June 9, 2021--El Salvador passed a new law on Wednesday that would make the small Central American country the world's first to deem bitcoin legal tender, a move that analysts say risks putting its economy at the mercy of the digital currency's sharp swings.
The designation allows bitcoin, the world's largest cryptocurrency by market value, to be used to buy goods and pay taxes and bank loans. Businesses would be required to accept bitcoin for payment, with the bitcoin-dollar exchange rate set by the market.
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Source: wsj.com
Citi Analysts See ETFs Gobbling $21 Trillion of Mutual Funds
June 8, 2021--Growth of actively managed strategies favors ETF wrapper
ETFs have taken in $387 billion in 2021, beating mutual funds
The $21 trillion U.S. mutual-fund industry could consist mostly of ETFs within the next 10 years, according to Citigroup Inc.
Investors have favored exchange-traded funds, lured by the industry's ultra-low fees and tax advantages. That trend remains in motion in 2021. ETFs have absorbed $387 billion since the end of December, while mutual funds have taken in $87 billion, according to Investment Company Institute and Bloomberg Intelligence data.
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Source: bloomberg.com
CBO-Monthly Budget Review: May 2021
June 8, 2021--The federal budget deficit was $2.1 trillion in the first eight months of fiscal year 2021, CBO estimates-$184 billion more than the deficit recorded during the same period last year.
Federal revenues were nearly $300 billion more from January through May 2021 than CBO expected when it made its full-year projections earlier this year. That increase stems mainly from larger-than-anticipated payments of individual and corporate income taxes, reflecting economic activity in calendar years 2020 and 2021. Specifically, estimated and final payments for individual and corporate income taxes for 2020 were larger and individual refunds were smaller than anticipated. Withholding for 2021 individual income taxes also has been greater than CBO expected. The reasons for the difference will be better understood as more detailed information becomes available later this year, but may reflect stronger-than-anticipated income growth throughout 2020 and so far in 2021.
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Source: Congressional Budget Office (CBO)
Bond ETFs With $1 Trillion Shrug as Fed Starts to Withdraw
June 7, 2021-The Federal Reserve delivered such a gift to the exchange-traded fund industry amid the throes of the pandemic that analysts say its exit will hardly be felt.
The central bank on Monday will start reversing its surprise decision last March to scoop up bond ETFs as part of efforts to keep credit flowing amid the coronavirus crash.
That move ushered a surge of inflows into bond ETFs, meaning that even though the Fed itself ended up buying just $8.6 billion of debt funds, the market ballooned to be worth $1.1 trillion.
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Source: ca.finance.yahoo.com
Biden prohibits U.S. investment in 59 Chinese companies allegedly involved in defense sector
June 3, 2021--June 3, 2021--President Joe Biden on Thursday expanded restrictions on American investments in certain Chinese companies with alleged ties to the country's military and surveillance efforts, adding more firms to a growing blacklist.
In an executive order, Biden barred U.S. investors from financial interests in 59 Chinese companies over fears of their links to the Chinese government's geopolitical ambitions, continuing some portions of the tough tact former President Donald Trump took in discussions with Beijing.
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Source: cnbc.com
Fed Is Among the Biggest Winners From Its Foray Into Credit ETFs
June 3, 2021--Central bank made $140 million off $8.6 billion of ETFs: Citi
Fed's purchases were concentrated in high-grade bond ETFs
Staving off the collapse of the financial system came with an added bonus for the Federal Reserve: A tidy profit.
The U.S. central bank accumulated roughly $8.6 billion worth of bond exchange-traded funds in 2020 as it worked to backstop markets amid a quickly descending pandemic. Now, as the Fed prepares to unwind its holdings on June 7, it's sitting on a gain of $140 million from the price appreciation alone, according to Citigroup Inc.
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Source: bloomberg.com
SEC delays decision on WisdomTree's proposed bitcoin ETF
June 2, 2021--The Securities and Exchange Commission last week delayed its decision on whether Cboe bZx will be able to list WisdomTree's proposed bitcoin ETF.
On May 26, the SEC announced that it would be pushing back its decision on the listing from May 30 to July 14 "so that it has sufficient time to consider the proposed rule change and the comments received."
The rule change itself is simply to allow listing of WisdomTree Bitcoin Trust or BTCW. WisdomTree filed a prospectus with the SEC on March 11, while the Cboe proposed the rule change on March 26.
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Source: theblockcrypto.com
Fed says it will start unwinding its corporate bond holdings
June 2, 2021--The Federal Reserve will begin to unwind the corporate bond holdings it acquired last year through an emergency lending facility launched to calm credit markets at the height of the pandemic, the central bank announced on Wednesday.
The Fed said the sale of its holdings in the Secondary Market Corporate Credit Facility, which includes corporate bonds purchased in the secondary market and exchange-traded funds that invest in corporate bonds, will be "gradual and orderly."
A Fed official said the decision to wind down the corporate credit facility was unrelated to monetary policy.
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Source: reuters.com
