Overseas finance wants traders to prepare for the Fed meeting, Blackstone CEO sounded the alarm bell of "drifting green", and JPMorgan Chase is optimistic about hedge funds, real estate and cryptocurrencies in 2022

21st Century Business Herald reporter Hu Tianjiao comprehensive report

<h4>1. Global financial markets</h4>

<h4>As traders prepared for the Fed meeting, Treasury yields fell</h4>

Ahead of the Fed's monthly meeting, traders scrambled to predict how central banks might pull back on accommodative monetary policy. Italy's 10-year yield, a key measure of the country's borrowing costs, fell 0.15 percentage points to 1.08 percent, climbing as high as 1.289 percent on Monday. Bond yields are inversely proportional to prices. The German 10-year yield fell 0.06 percentage points to -0.161%. Yields on the two-year Treasury note, which track U.S. monetary policy expectations, fell 0.05 percentage points to 0.464 percent, hitting an 18-month high last week. Earlier, the Reserve Bank of Australia on Tuesday lifted some emergency monetary support measures, abandoning a policy of maintaining low bond yields while confirming no rush to raise rates. Events in Australia don't always ripple through global markets, but analysts say government bonds have become so sensitive to central bank hints that the RBA's move is enough to change traders' perceptions of the Fed or ecbloc's next move.

<h4>The RBA tightened monetary policy in response to the price spike</h4>

The Reserve Bank of Australia abandoned its policy of controlling the yield curve, becoming one of the first major central banks to take action in response to post-pandemic price spikes. The RBA said it would no longer try to maintain the 3-year Treasury yield at 0.1%. The previous week, the RBA's refusal to defend its cap led to turmoil in short-term bond markets and soaring yields. The shift has made the RBA one of the first central banks in advanced economies to tighten monetary policy in the wake of the outbreak and will increase pressure on the Bank of England to consider raising interest rates at its meeting on Thursday. But while the RBA has loosened its grip on the yield curve, it has also signaled that it is not in a hurry to raise short-term rates, promising to keep rates unchanged until inflation remains in the 2% to 3% target range.

<h4>U.S. regulators filed a lawsuit to block Penguin Random House's merger with Simon &amp; Schuster</h4>

U.S. regulators have filed a lawsuit to try to block the merger of Penguin Random House with Simon &amp; Schuster. If the merger is successful, it will create a super-large publisher in the U.S. book market. Bertelsmann, which owns Penguin Bookhouse, reached a $2.2 billion deal last November to acquire Simon &amp; Schuster, owned by ViacomCBS. The U.S. Department of Justice (US DoJ) wrote in a lawsuit filed in federal court in Washington on Tuesday that if the merger goes ahead, Penguin Random House will become the largest book publisher in the United States that is far ahead of its competitors. "This merger will give Penguin Random House a huge influence over who publishes, what it publishes, and how much the author gets paid for his work." Rival Murdoch Group had feared that the proposed merger would create an anti-competitive "book behemoth" that would control a third of the U.S. market. Bertelsmann has previously denied this.

<h4>The CFA final exam pass rate dropped to 39%.</h4>

The final pass rate for the Chartered Financial Analyst exam slipped again, to its lowest level in 58 years. According to the CFA Institute website, only 39 percent of test takers passed the Level III exam in September, compared with 42 percent in May and June, setting a new low at the time. The 10-year average pass rate for the final level of the series is now 53%. "Under 'normal' circumstances, passing all level three exams in the CFA curriculum is an incredible achievement," the association's chief executive, Margaret Franklin, said in a statement Tuesday. "It's even more impressive that during these difficult times, many test takers have to struggle between changing test schedules, increased workloads, and family responsibilities." Prior to the final exam results in September, pass rates at all levels of the CFA exam had been at an all-time low in recent months.

<h4>2. International Regulatory Developments</h4>

<h4>Britain welcomed France's "détente" of the fisheries dispute</h4>

Environment Secretary George Eustice welcomed a "significant downgrade" of the dispute between Britain and France over post-Brexit fishing rights. After Paris suspended a round of threatened sanctions against Britain, negotiations continued. French President Emmanuel Macron has vowed that if Boris Johnson's government does not issue him more permits, it will prevent British fishing boats from unloading goods at French ports and will step up inspections of British imports starting tuesday. With the midnight deadline just hours away, he said he would postpone the measures to "give a chance" for final talks convened by the European Commission to continue on Tuesday. "You can't impose sanctions while negotiations are still going on," he said on the sidelines of the COP26 climate summit in Glasgow. "The next few hours are important. I know the British will come to us with other suggestions. We very much welcome France's decision not to continue to carry out its threat, and we will continue those constructive discussions. ”

<h4>3. Global Commodities</h4>

<h4>As generators shifted from natural gas to natural gas, coal use in the United States surged</h4>

Under Biden's leadership, the U.S. coal market briefly recovered. Biden has pledged to limit U.S. use of fossil fuels and will join other world leaders in the COP26 climate conference in Glasgow, pledging to drastically reduce carbon emissions. According to the U.S. Energy Information Administration (US EIA), coal burning at U.S. power stations will increase by nearly 20 percent this year to 521 million short tons, making coal the second largest source of electricity in the United States, after natural gas. To Mr. Biden's embarrassment, he had promised to eliminate all carbon emissions from the U.S. power sector by 2035, but the increase in coal use ran counter to a downward trend during Donald Trump's four-year reign, a trump administration that promised to reinvigorate the U.S. coal industry. Meanwhile, G20 leaders reached an agreement on Sunday to end international financing of coal power, but did not agree to halt their own coal power.

<h4>4. Green finance is related to ESG</h4>

<h4>Blackstone CEO sounded the alarm bell of "drifting green"</h4>

Blackstone CEO Larry Fink said focusing too narrowly on climate policy by public companies could undermine the green agenda and could create "the biggest capital market arbitrage of our lifetimes" as hydrocarbon assets move from public to private. Fink said: "There is now more transfer from oil and gas assets to private hands than ever before. This will not change the world of net zero. This is whitewashing the façade, it is washing green. ”

<h4>5. Fintech and virtual currency, etc</h4>

<h4>JPMorgan chase is bullish on hedge funds, real estate and cryptocurrencies in 2022</h4>

JPMorgan Chase &amp; Co. Strategist Nikolaos Panigirtzoglou said investors with cash available should consider investing in hedge funds and real estate, as traditional assets such as stocks and bonds will perform less than expected next year. The strategists write that so-called alternative assets (which also include digital currencies, private debt and private equity) "should continue to perform well in 2022." They expect such products to return 11 percent next year, twice as much as the 5 percent return on equities and fixed income products. They said that cryptocurrencies may benefit, but the process may be too bumpy to recommend as a core holding asset. In last week's report, the strategists said: "Unlike traditional asset classes, the process of setting up positions and exiting at scale is not so simple." "As such, it is more suitable for institutional investors who wish to allocate new cash flows to the alternative investment space than to institutional investors considering a strategic/long-term allocation to alternative investments."

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