CFA Society Chicago NewsBrief
Jul. 1, 2014

Lay it down for us: What are Chicago's biggest startup challenges?
Chicago Tribune
TechWeek Chairman Iain Shovlin asked a high-profile panel touting Chicago's tech scene what area “needs to be attacked." Brenna Berman, Chicago’s chief information officer and commissioner of the Department of Innovation and Technology, emphasized attracting and keeping talent. Howard Tullman said 1871, where he is CEO, is working hard to recruit college students from top area schools and is considering a program that would offer a free year of membership at 1871 for college-run businesses.More

Get ahead of the game: Level 1 exams will be here before you know it
CFA Chicago
The Level 1 December 2014 CFA exams will be here before you know it! You are invited to join leaders from CFA Chicago and members from Kaplan Schweser to find out how to best prepare for the CFA exam. Those in attendance will have an opportunity to win a scholarship for a prep-course study package awarded by Kaplan Schweser. Join fellow students on Thursday, July 10 from 5 p.m. to 7 p.m. for a study group kick-off party and open house — the event is free, but you must register to attend.More

The crucial cog in the BlackRock machine
CFA Chicago
Rick Rieder, Managing Director, is BlackRock's Chief Investment Officer of Fundamental Fixed Income, Co-head of Americas Fixed Income and a member of the Executive Committee of the firm-wide Alpha Strategy business, a member of BlackRock's Global Operating Committee and Chairman of the BlackRock Investment Council. Join CFA Chicago on July 29 at 12 p.m. for the Distinguished Speaker Series featuring Rieder.More

Gabelli and GAMCO: Providing guidance to investors since 1977
CFA Chicago
Mario Gabelli, CFA is Chairman, Chief Executive Officer of GAMCO Investors, Inc., a New York Stock Exchange listed company that is a widely recognized provider of investment advice to alternative investments, mutual funds, institutional and private wealth management. GAMCO Investors, Inc. is listed on the New York Stock Exchange. Gabelli founded the firm in 1977 as an institutional broker-dealer. It has grown into the diversified financial services corporation it is today. Join CFA Chicago on Tuesday, August 12 at 12 p.m. for the Distinguished Speaker Series featuring Gabelli.More

Is it time for the Fed to contract its balance sheet?
CFA Institute's Enterprising Investor
The Federal Reserve can keep their balance sheet at the current size (and keep the risk asset party going) or it can position itself to be able to hike rates — but it cannot do both. The Fed recently announced that purchases of agency mortgage-backed securities and U.S. Treasuries would fall to $35 billion per month. If they continue reducing their purchases by $10 billion per month, the incremental purchases should be finished by October. So what will happen?More

Time for Yellen to target inflation, worry less about jobs
Market Watch
Legend has it — and it almost certainly is legend — that one midnight long ago, the blues artist Robert Johnson went down to the crossroads of two Mississippi highways and sold his soul to the Devil to become a great musician. Johnson’s song “Cross Road Blues” was immortalized by guitar god Eric Clapton. It’s a powerful metaphor for a momentous decision that changes your life forever. Now Federal Reserve Chairwoman Janet Yellen is herself approaching a crossroads. And the stakes are also very high: The health of the markets and the U.S. economy over the next few years.More

Pimco runs risks in turning up the 'vol'
Financial Times
It was a tantalising introduction. Bill Gross, Pimco’s “Bond King” and founder of the world’s largest fixed income fund, promised to impart the secrets of his extraordinary success to an audience of financial advisers in Chicago. “I’ll be handing you the keys to the Pimco Mercedes,” he told them. Unlike smaller fixed income funds that might just buy and sell bonds, the $230 billion Pimco Total Return fund is a clever user of derivatives trading strategies, Gross went on to explain, and Pimco is one of the biggest sellers of insurance against market volatility. More

City Hall better explain risky financial deal
Chicago Sun-Times
The City of Chicago’s significant exposure to interest-rate swaps liabilities, as detailed by Sun-Times reporter Dan Mihalopoulos (“Rahm’s $200 Mil Time Bomb,” June 18), highlights a need for additional transparency on the specifics of such deals and the city’s rationale for entering into them. According to the accounting in Mihalopoulos’ story, many of the derivative contracts in the city’s swaps portfolio have termination clauses if Moody’s lowers its rating below Chicago’s current level.More

The cities stealing jobs from Wall Street
When we think about American finance, the default image is of a pinstriped banker on Wall Street. But increasingly financial services is shifting away from the traditional bastions of money. In an analysis of recent and longer-term employment trends, we have identified the large cities — those with over 450,000 jobs — that are gaining jobs in financial services, a sector that employs 7.9 million people nationwide. Overwhelmingly, the fastest growth has been in cities not associated with high finance, but largely low-cost Sun Belt cities, which account for seven of the top 10 large metro areas on our list.More

Here are BlackRock's key themes for the rest of the year
Business Insider
BlackRock is out with its mid-year update to "The List" — five things investors should know for the rest of the year, and five things they should do. "The first half of the year was filled with surprises that few could have foreseen — and yet markets seemed not to notice, carrying on with gusto," according to BlackRock. "While we don’t believe we are entering a calm-before-the- storm environment, there are certainly factors that argue against complacency in the second half." More

Bitcoin auction draws Wall Street, Silicon Valley bidders
The Boston Globe
Buyers from Wall Street to Silicon Valley are lining up to bid on a cache of bitcoins worth about $17 million, underscoring the interest in the digital currency even after its boom and bust. Pantera Capital Management, a San Francisco hedge fund backed by Fortress Investment Group, and SecondMarket Inc., a New York brokerage, are among those seeking to buy bitcoins from the U.S. government at an auction scheduled for June 27. A broad swath of interested parties, from individuals to institutional investors, have requested information from the U.S. Marshals Service, which is handling the sale.More

McGraw-Hill, CME said to weight joint bid for Barclays index arm
McGraw-Hill Financial Inc. and CME Group Inc. are interested in acquiring Barclays Plc’s index business and merging it with S&P Dow Jones Indices LLC — manager of the benchmark S&P 500 Index and Dow Jones Industrial Average, according to people familiar with the matter. Barclays, the largest U.K. bank by assets, began considering a sale of its index arm last year, but has delayed the auction in part to wait for Northwestern Mutual Life Insurance Co. to move forward with its sale of Russell Investments Ltd., another index manager, sources said.More

Lay it down for us: What are Chicago's biggest startup challenges?
Chicago Tribune
TechWeek Chairman Iain Shovlin asked a high-profile panel touting Chicago's tech scene what area “needs to be attacked." Brenna Berman, Chicago’s chief information officer and commissioner of the Department of Innovation and Technology, emphasized attracting and keeping talent.More

BlackRock shifts pay formula for US sales force
BlackRock Inc., the world's biggest money manager, has made a radical shift in the way it pays its retail mutual fund salespeople in the United States, a top executive said.More

What the gap between CPI and PCE means for Fed overshooting
The Wall Street Journal
One of the biggest debates right now over the outlook for inflation is whether the Federal Reserve would allow inflation to overshoot its target – that is, allow inflation to rise above 2 percent for some period of time.More