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Macron ♥ Vestager

The French president would like to see the Danish commissioner get Juncker’s job.

Emmanuel Macron knows whom he wants as the next president of the European Commission — the bloc’s competition supremo, Margrethe Vestager.

According to three senior officials in the European Parliament, the French president hopes to convince the Danish commissioner to be a candidate for the Commission presidency in 2019.

There is a stumbling bloc: She’s a member of the Liberals, languishing in fourth place behind two center-right and the main center-left political families in terms of size and support. The backing of a French president — even one whose approval ratings have gone through the floor — could provide a major boost to the Liberals, however.

“Macron has informed some people about it, including Joseph Daul,” said a senior Parliament official, referring to the president of the conservative European People’s Party. The official added that if Macron wants to get his pick into the Commission top job, “his only choice is to put pressure on the Liberals.”

The current Commission president, Jean-Claude Juncker, announced last year that he would not seek a second mandate when his term ends in 2019. And Vestager, who has been dubbed the “most powerful woman in the EU,” would be in a good position to replace him, and is believed to be interested in the job. However, she would likely face competition from fellow Commissioners Jyrki Katainen and Pierre Moscovici as well as Michel Barnier, the EU’s lead Brexit negotiator.

“Macron’s interest in Vestager is evident,” said Pieyre-Alexandre Anglade, a French MP for Macron’s En Marche movement. “She’s doing an excellent job, she’s the most visible pro-European, she’s a woman, she’s been successful on files that Macron cares about, and she has shaken things up in the EU on many topics.”

Anglade added it was too soon for Macron to have his heart set on one candidate, and that he could yet support another Liberal candidate, such as Guy Verhofstadt, the leader of the ALDE group.

Vestager’s office declined to comment on the Macron connection and has steadfastly refused to discuss her next steps after the antitrust portfolio.

Jens Rohde, a Danish MEP from Vestager’s Danish Social-Liberal Party (Radikale Venstre), said he had not discussed the matter with her, “but in my opinion she would be an excellent choice for Europe.”

“Margrethe Vestager is top qualified as a politician, and I also think that it is time for Europe to find a president who is able to make our common project shine,” Rohde said. “Finally, it is time for a woman to take the position.”

Macron, the big prize

At the 2014 European Parliament election, many EU leaders embraced the Spitzenkandidat system under which the political family that won the most seats in the Parliament election (in this case, the EPP) saw its candidate (Jean-Claude Juncker) become Commission chief. The system is likely to be used again in the 2019 election.

So far, Macron has not joined any European political family. He served in the government of his Socialist predecessor in the Elysée, François Hollande, but drew support from all sides when he struck out on his own. Officials say Macron is drawn to Vestager because she is far from the traditional image of the dull Eurocrat.

The liberal ALDE group to which Vestager belongs is the third force in the European Parliament and the party has eight EU leaders in its ranks, including Dutch Prime Minister Mark Rutte, Xavier Bettel from Luxembourg and now Andrej Babiš in the Czech Republic. If Macron joins the Liberals, they would leapfrog the Socialists to become the largest group in the Council.

Not everyone is convinced.

“The real question is which political family will he join? If he chooses the Liberals, then he could have something to say about the Spitzenkandidat,” said Alain Lamassoure, a veteran French MEP from the conservative EPP. “But ALDE today is a secondary and highly heterogeneous force with political figures that are not really at Macron’s level.”

Vestager knows Macron well, dating back to his time as French economy minister when she spent months reviewing GE’s takeover of Alstom’s turbine business and EDF’s takeover of Areva.

Vestager’s team has also been conducting a long-running and controversial probe into hydroelectric concessions given by the French state to EDF.

Despite those adversarial proceedings, people close to Vestager have described her relations with Macron as warm. They spoke regularly when he was economy minister, according to one colleague, and have shared a stage at events. Last month, when Vestager was in Paris she had a meeting at the presidential palace.

Common ground

Vestager and Macron appear to have plenty in common. Both have sought to square the circle between economic liberalism and social protection. Vestager prides herself on having driven through tough reforms that, she says, may bring pain in the short term but will benefit Denmark in the long term; Macron appears to be setting off down the same path.

Both are firm believers in the European project and regularly extol its benefits. Both are relative outsiders to their national political establishments, with Vestager hailing from a small party and Macron creating his own. Both are acutely aware of the need to harness the dynamism of the digital economy but also to rein in its excesses.

But the unity may not last. In the coming months, Siemens and Alstom will ask Vestager to approve the merger of their railway operations, in a deal that has the backing of Paris and Berlin but has raised competition concerns. The antitrust and state aid probe into EDF could also take a turn that could displease Macron’s government.

Three boxes to tick

According to EU lore, an aspiring president of the European Commission is said to need three qualities. First they must have been a member of the European Council — a head of state or government. Second, they must come from a country that is a member of the eurozone. Third, they must not have been around long enough to have made enemies in national capitals.

Juncker certainly did not tick the third box — but he overcame initial fears about his candidacy from Berlin and strong objections from London and Budapest.

Vestager, a former deputy prime minister of Denmark, would not meet criteria one or two. As for the third: Vestager has not been around that long, but her big decisions against the tax dealings of Apple, Starbucks and others have generated bad blood in the European countries that house them, such as Ireland and the Netherlands.

It would also be hard for Macron to dismiss the claims of Barnier, who is widely believed to harbor a burning ambition for the EU’s top post. Barnier would be a natural fit for the EPP, home to Angela Merkel’s Christian Democrats. “It would be strange to have Macron supporting a different candidate than the one put forward by the CDU,” French MEP Lamassoure said.

Meggitt’s chief executive will step down at the end of 2017 after a turbulent five years at the aerospace components maker, which reported a further bump on Tuesday as revenues in one of its divisions grew more slowly than expected in the third quarter.

Tony Wood, currently Meggitt’s chief operating officer, will take over as CEO on January 1, though Stephen Young will stay at the company to work with Mr Wood until he retires at the end of April.

Mr Young’s tenure was marked by a series of sales warnings shortly after he took the reins, and it has since worked to turn itself around with by cutting costs and restructuring its supply chain. Shares in the company have recovered around a 33 per cent from their 2015 nadir, but are practically flat compared to when Mr Young became chief.

A separate announcement on Tuesday highlighted the company’s bumpy path to recovery, with organic revenue growth flat year on year in the third quarter due to a slower than expected ramp up of new civil aerospace programmes. Meggitt warned that the slow spending “will continue into the fourth quarter”.

The company had been hoping that faster growth in civil aerospace would offset a decline in its military arm, where revenues fell by 5 per cent. However, it was optimistic that military sales would improve in the fourth quarter, and said it is on track to meet full-year guidance for organic revenue growth and underlying operating profit margins.

Outgoing chief Mr Young said:

NEW YORK (Reuters) - Mike Novogratz, the former macro hedge fund manager at Fortress Investment Group who has joined the mad dash for crypto-currencies, said on Monday that mainstream institutional investors are about six to eight months from adopting bitcoin.

Novogratz said he expects major financial firms will soon start to offer bitcoin or similar products as an investment option, one that could be easily purchased over the phone.

A turning-point product from a big financial firm could arrive within six months, he said, though he declined to name a specific company.

“When it’s that easy, the price of bitcoin or ethereum is going to go much higher. And that is a lot closer than people think,” said Novogratz, who spoke at the Reuters Global 2018 Investment Outlook Summit in New York.

Novogratz is now chief executive of Galaxy Investment Partners, a firm that bets on cryptocurrencies and related businesses.

“The institutionalization of this space is coming. It’s coming pretty quick,” he said.

For the most part though, institutional investors have stayed away from bitcoin BTC=BTSP, the original and largest crypto-currency in terms of market capitalization, despite outperforming all the world's traditional currencies.

Traditional investors still view bitcoin as opaque and highly speculative with potential to collapse even though so far this year bitcoin has soared nearly 580 percent.

Bitcoin surged on Monday to $6,487, recovering more than $1,000 after losing almost a third of its value in less than four days as traders bought back into the volatile cryptocurrency.

It hit a record peak last week just shy of $8,000.

During the latest pullback over the weekend though, Novogratz said he bought $15 million to $20 million worth of bitcoins.

Early enthusiasts for the crypto-currency were drawn to its revolutionary ideals of transparency and a lack of central or official control. The risks of dealing in bitcoin were laid bare in 2013 when Tokyo-based exchange Mt Gox collapsed after admitting it had lost the equivalent of hundreds of millions of dollars of investor funds.

The currency’s earlier ties to gambling and criminal websites did not endear it to traditional investors.

But bitcoin has since overcome some of those challenges. “We’re past that,” he said.

BIGGEST REGRET FOR 2017

Novogratz’s biggest regret this year has been not buying more cryptocurrencies, such as ethereum, when prices fell, because he knew that they would keep going up.

Ethereum is another public blockchain, essentially a shared database, similar to that of bitcoin. Ethereum’s token is called ether.

He felt that he made a psychological mistake, comparing the original price he paid to ethereum’s value over the summer. “When it was time to buy it back, I didn’t buy enough back,” he said.

He sees bitcoin, for instance, hitting $10,000 by March.

The former Fortress executive recently created his own crypto-hedge fund, putting in about $100 million of his own money. He hopes to raise about $500 million, making it the largest fund of its kind.

Novogratz said Galaxy’s largest investment is in bitcoin. It has a “very big” holding of ethereum and about 30-35 different tokens and companies. He declined to give the percentages of each holding, citing competitive reasons.

One of those investments is in the token sale of Worldwide Asset Exchange, an online marketplace for so-called “skins,” which are essentially virtual accessories of video game characters. The total market for “skins” is $50 billion.

The skins don’t have much application except to change how a character or a weapon looks.

He is also an investor in FunFair, a decentralized gaming platform.

FORTRESS EXIT

Novogratz, a former Princeton University wrestler, U.S. Army helicopter pilot, and Goldman Sachs Group (GS.N) partner, is best known as a swaggering “macro” investor in the mold of George Soros who made big wagers on global economic movements.

Novogratz worked at Fortress from 2002 to 2015, where he was a principal and ran its macro hedge funds. They grew to manage billions of dollars and made “Novo” a Wall Street star. But the funds were shut in 2015 following investment losses. Novogratz retired from the firm.

“Very few people have graceful exits from Wall Street. Mine wasn’t as graceful as I would have liked,” he told Reuters.

After Fortress, Novogratz planned to focus running his own money and avoid the complications of external investors. But he fell in love with the promise of blockchain technology after successfully investing in bitcoin, ethereum and other assets.

He has quickly become one of the most prominent advocates of blockchain and has been working to convince larger, more conservative asset managers to get involved.

“It’s potentially wildly disruptive and revolutionary,” Novogratz said.

Hobby Lobby Scion Spent Millions on Biblical Relics—Then Came a Reckoning

Steve Green’s collection, once headed for the Museum of the Bible in Washington, D.C., is tainted by allegations of smuggling

Full Article attached

Move will force hosts to comply with Paris’s legal limit of 120 days a year on short-term rentals

PARIS—Airbnb Inc. plans to curb rentals of some of its most popular listings in the French capital, expanding its bid to placate regulators in the U.S. and Europe that have assailed the firm and could threaten its growth.

The home-sharing firm said Tuesday it will start automatically capping the number days a year that hosts can rent out dwellings in parts of central Paris—the company’s largest market by listings, with 65,000. That will effectively force hosts to comply with the city’s legal limit on short-term rentals of homes of 120 days a year.

Airbnb’s decision to enforce a Paris cap is the first expansion of a measure the firm rolled out last year in London and Amsterdam, establishing it as a template in the company’s efforts to calm activists and regulators world-wide. Many cities argue that the firm’s short-term rentals make it more lucrative for property owners to cater to tourists than to rent out homes to long-term residents, and sought to limit them.

“We want to do our bit to address historic housing concerns in central Paris and help make this city a better place for everyone,” said Emmanuel Marill, Airbnb’s general manager for France.

Airbnb’s fast growth since its founding in 2009 has helped the San Francisco-based firm catapult to a valuation of $31 billion. But similarly to opposition that Uber Technologies Inc. has faced from taxi operators and regulators, Airbnb has clashed with major hotel chains whose business it is disrupting and faced ire from city officials world-wide who view the company as upsetting their local residential ecosystem.

Airbnb has long denied having a significant impact on housing, but in recent years it has also started making an effort to cozy up to local officials and soothe their complaints on the issue—in part to help avoid or overturn legislation that could restrict its operation. In March, the company settled a lawsuit it had filed against a tough San Francisco law by agreeing to help register hosts on behalf of the city. In Berlin, the company has lobbied heavily to convince legislators to revise a law that makes it difficult for many residents to rent out their homes.

One of the firm’s biggest concessions so far has been the voluntary curbing of its most prolific hosts—which the firm says represent a small sliver of its listings, but likely account for a larger slice of its revenue.

So far in London, the company says the effort successfully has pared listings. The number of rentals that go over the city’s 90-day-a-year limit has declined from 21% of rentals before the rule to 7% this year, the company said in a September report. The rentals still over the limit include apartments with special authorization and those that went over the limit before the cap was applied, Airbnb said.

In Paris, the new policy, which goes into effect in January, will block Airbnb listings in the city’s first four arrondissements from being rented for more than the citywide legal limit, unless the property owner has proper authorization. The area Airbnb is subjecting to the cap includes tourist-filled neighborhoods like the Marais and landmarks like the Louvre Museum, but doesn’t include other popular areas like Montmartre or the Left Bank, even though they are also subject to the legal limit.

An Airbnb spokesman said the company hasn’t placed caps on other neighborhoods because its goal isn’t to help enforce the law, but rather “to address local problems where they are.” He said the city had been briefed on the change.

A city official in charge of housing policy didn’t immediately respond to a request for comment.

It is unclear what financial hit Airbnb might take by curbing what are, by definition, its most active rentals in what are some of Paris’s most expensive neighborhoods. An Airbnb spokesman declined to say in absolute terms how many listings the company currently has currently that are rented above the 120-day limit, but said they account for 0.64% of the total housing capacity in Paris. That works out to about 8,700 dwellings, given Paris’s total of 1.36 million units, according 2014 figures from government agency Insee.

The spokesman said company expects “minimal impact on the number of guest arrivals” because people who would have otherwise stayed in central Paris will stay in other areas of the city.

Airbnb is implementing the automatic cap in Paris just a few weeks before the the city obliges owners of noncommercial residences on platforms like Airbnb to register with the city, and to post their registration numbers on their listings. Airbnb has updated its website forms to accommodate the numbers, but says it won’t force hosts to post them.

Official data added weight to the gloomy picture for London house prices on Tuesday, as annual growth slowed to 2.5 per cent over the year to September from 2.7 per cent in the previous month.

Average house prices in the capital fell for the second month in a row to £484,000 — still well ahead of the next priciest region, the south east, which had an average price of £324,000 in September.

Across the UK home values held up better, according to the Office for National Statistics, with prices increasing 5.4 per cent in the year to September, up from 4.8 per cent in August. While national growth has slowed from around 8 per cent in mid-2016, prices have hovered around a relatively steady 5 per cent annual growth rate throughout 2017.

ONS head of inflation Mike Prestwood said:

Policymakers risk being left behind with new means of payment, warns UBS chairman

Central banks should be more open to creating digital versions of their currencies, which could offer significant benefits to society, the chairman of Swiss bank UBS says.

Axel Weber is a past president of Germany’s conservative Bundesbank — and was once tipped as a future head of the European Central Bank. As UBS chairman, he is helping to drive a revolution in how banks, companies and individuals conduct financial transactions.

In an interview with the Financial Times, he now worries his former public sector colleagues may be left behind. “Whilst the official sector very often looks at the risks of these new means of payment, the private sector tends to look at the opportunities they offer,” he says.

Mr Weber’s comments come amid uncertainty among central bankers over how they should react to the rise of digital and cryptocurrencies and how they operate beyond official financial systems — he carefully distinguishes the latter as using encryption to mask transactions.

The chairman argues the issue is not the volatility of bitcoin prices — the currency is “simply too insignificant to matter” from a financial stability perspective.

It’s more that the threat of the crypto world financing terrorism or enabling money laundering will eventually prompt a stronger response from authorities. There is “a relatively high probability that regulators will regulate it at some point”.

Less clear cut, however, are likely to be arguments over digital currencies issued by central banks. Like cash, which they could eventually replace — but unlike bitcoin — they would be backed by monetary authorities, so they would also act as a store of value as well as widely accepted means of payment.

In China, the central bank has said it will develop a digital currency using the blockchain technology behind bitcoin. In Europe, Sweden’s Riksbank published a report in September suggesting there were few obstacles to issuing e-krona.

But other central banks have been much more cautious. Jens Weidmann, Mr Weber’s successor as Bundesbank president, argued the focus should instead be on improving existing payment systems.

Like the Bundesbank, the Swiss National Bank is not convinced of the need for central bank e-currencies. There are fears that in times of panic, customers could quickly switch funds out of normal bank accounts and into e-currencies, exacerbating bank runs. Germans and Swiss also remain heavy users of cash — unlike Swedes.

Mr Weber, however, says central banks are wrong to think it is a case of either traditional cash or e-currencies. Payment patterns evolve, he says, with younger generations more likely to pay via mobiles, independently of banks. If central banks regarded digital currencies as an opportunity, they could “probably provide non-account-related payment services for society in a cheaper and more economic way”.

The advantages would be most apparent in geographically large countries, where cash transport is expensive — such on the African continent. Mr Weber envisages digital currencies not having the anonymity of cash — indeed features in the currency could identify users, so minors could be prevented from buying alcohol, for instance. But the technology would have to be hacker-proof. “It has to be a very secure means of payment.”

Meanwhile, UBS is pressing ahead with its own digital currency. It is working with other banks, including Barclays, Credit Suisse and HSBC, on a “utility settlement coin”.

It would use the same distributed ledger technology as blockchain and could be used to clear and settle financial transactions. The idea is that “coins” used for transactions would be backed by cash held in accounts at central banks. They would be safer and quicker than current systems based around a single centre counterparty.

Mr Weber reports “an openness by central banks to hear about the concept” but admits the scheme is a long way from becoming operational.

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Central banks should be more open to creating digital versions of their currencies, which could offer significant benefits to society, the chairman of Swiss bank UBS says.

Axel Weber is a past president of Germany’s conservative Bundesbank — and was once tipped as a future head of the European Central Bank. As UBS chairman, he is helping to drive a revolution in how banks, companies and individuals conduct financial transactions.

In an interview with the Financial Times, he now worries his former public sector colleagues may be left behind. “Whilst the official sector very often looks at the risks of these new means of payment, the private sector tends to look at the opportunities they offer,” he says.

Mr Weber’s comments come amid uncertainty among central bankers over how they should react to the rise of digital and cryptocurrencies and how they operate beyond official financial systems — he carefully distinguishes the latter as using encryption to mask transactions.

The chairman argues the issue is not the volatility of bitcoin prices — the currency is “simply too insignificant to matter” from a financial stability perspective.

The official sector very often looks at the risks of these new means of payment

Axel Weber

It’s more that the threat of the crypto world financing terrorism or enabling money laundering will eventually prompt a stronger response from authorities. There is “a relatively high probability that regulators will regulate it at some point”.

Less clear cut, however, are likely to be arguments over digital currencies issued by central banks. Like cash, which they could eventually replace — but unlike bitcoin — they would be backed by monetary authorities, so they would also act as a store of value as well as widely accepted means of payment.

In China, the central bank has said it will develop a digital currency using the blockchain technology behind bitcoin. In Europe, Sweden’s Riksbank published a report in September suggesting there were few obstacles to issuing e-krona.

But other central banks have been much more cautious. Jens Weidmann, Mr Weber’s successor as Bundesbank president, argued the focus should instead be on improving existing payment systems.

Like the Bundesbank, the Swiss National Bank is not convinced of the need for central bank e-currencies. There are fears that in times of panic, customers could quickly switch funds out of normal bank accounts and into e-currencies, exacerbating bank runs. Germans and Swiss also remain heavy users of cash — unlike Swedes.

Mr Weber, however, says central banks are wrong to think it is a case of either traditional cash or e-currencies. Payment patterns evolve, he says, with younger generations more likely to pay via mobiles, independently of banks. If central banks regarded digital currencies as an opportunity, they could “probably provide non-account-related payment services for society in a cheaper and more economic way”.

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The advantages would be most apparent in geographically large countries, where cash transport is expensive — such on the African continent. Mr Weber envisages digital currencies not having the anonymity of cash — indeed features in the currency could identify users, so minors could be prevented from buying alcohol, for instance. But the technology would have to be hacker-proof. “It has to be a very secure means of payment.”

Meanwhile, UBS is pressing ahead with its own digital currency. It is working with other banks, including Barclays, Credit Suisse and HSBC, on a “utility settlement coin”.

It would use the same distributed ledger technology as blockchain and could be used to clear and settle financial transactions. The idea is that “coins” used for transactions would be backed by cash held in accounts at central banks. They would be safer and quicker than current systems based around a single centre counterparty.

Mr Weber reports “an openness by central banks to hear about the concept” but admits the scheme is a long way from becoming operational.

The storage and the computing power needed for such networks to be fast as current systems ‘’are not yet there. So speed relative to traditional databases is still an issue.”

The UBS chairman says the utility settlement coin could be opened up to third-party users, which would include the bank’s biggest customers. But he envisages different coins being used for transactions in different currencies, such as the euro or dollar — so it would not become a prototype world currency.

Debate about the future of digital currencies has been overshadowed by the hype over bitcoin. Does Mr Weber worry a bitcoin crash might set back digital currency pioneers? The UBS chairman is adamant it will not. “People do . . . draw the distinction between the construction of bitcoin or cryptocurrencies as they are now, and the potential that the underlying technology has,” he says.