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TALKING POINTS

JPMorgan, Goldman Sachs stop Russian debt trading

Jonathan Fickies/Bloomberg

INTERNATIONAL FINANCE

JPMorgan, Goldman Sachs stop Russian debt trading

Two giant Wall Street banks are withdrawing from handling trades of Russian debt after the Biden administration’s surprise announcement last week it’s banning US investors from scooping up such assets. JPMorgan Chase & Co. and Goldman Sachs Group Inc. were still matching sellers who wanted out of the debts with interested buyers this month, according to market professionals. Now, JPMorgan is pulling back after the US Treasury’s Office of Foreign Assets Control said investors in the United States aren’t allowed to acquire them, a person with knowledge of the decision said. A spokesperson for Goldman said it’s halting such transactions, too..The Treasury Department’s announcement late June 6, stepping up financial sanctions, caught market participants off guard and set off a flurry of talks with lawyers. Earlier policies from the United States had allowed trading shops including Goldman Sachs and JPMorgan to help clients pounce on cheap Russian debt in the secondary market as many holders rushed to unload the assets. Now, US market participants are prohibited from purchasing both new and existing debt and equity securities issued by a Russian Federation entity. The updated guidance means US investors can still sell or hold Russian debt, but they can’t acquire more, a spokesperson for OFAC said last week. ― BLOOMBERG NEWS

CRYPTOCURRENCY

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Branson takes aim at crypto scams using his name

British billionaire Richard Branson hit out at cryptocurrency scammers and said he’s stepping up efforts to stop his name from being used to convince unsuspecting victims to sign up to fraudulent schemes. “It’s a terrible thing because it affects a small person who can ill afford it,” Branson said in an interview in Austin, Texas. “We are doing enormous amounts to try to stop it.” The Virgin Group founder said he has spoken with Meta Platforms’s outgoing chief operating officer Sheryl Sandberg about erroneous promotions appearing on Facebook, and directed lawyers to confront other social media players whose platforms have hosted fake advertising. In the UK, Branson has joined with business figures to persuade the government to include paid-for scam ads in the new Online Safety Bill, which will make tech firms responsible for user-generated cons. Branson’s name may be particularly open to exploitation because he has backed bitcoin as a sensible investment. Cryptocurrency scams typically feature fake online newspaper reports in which individuals appear to endorse crypto schemes that readers can access via links in the articles. Money is extracted from the unwary in a variety of ways, including so-called advance fee frauds seeking upfront payments. ― BLOOMBERG NEWS

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MARIJUANA

Germany moves ahead with plan to legalize cannabis sales

The German government is setting in motion plans to legalize the sale of cannabis for recreational purposes, aiming to have legislation ready later this year. The Health Ministry said Monday that it will start holding expert hearings on various aspects of the issue Tuesday. It said that more than 200 representatives from the medical, legal and other fields will take part, along with officials from various levels of government and unidentified international experts. The pledge to legalize controlled sales of cannabis to adults in licensed shops is one of a series of reforms outlined in last year’s coalition deal between the three socially liberal parties that make up Chancellor Olaf Scholz’s government. They said the plan would ensure quality control while also protecting young people, and agreed that the “social effects” of the new legislation would be examined after four years. The five hearings, which will be held through the end of this month, will address what measures are needed to ensure the best protection for young people and of health and consumers, government drug czar Burkhard Blienert said. ― ASSOCIATED PRESS

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BREXIT

The European Union said it will consider new infringement proceedings against the UK after London presented planned legislation to override parts of the Brexit withdrawal agreement. Maros Sefcovic, the EU’s chief Brexit negotiator, told reporters the bloc would not renegotiate the Northern Ireland protocol, which keeps the area in the EU’s single market while creating a customs border with the rest of the UK. ― BLOOMBERG NEWS

SPACE INDUSTRY

SpaceX clears FAA hurdle in effort to expand number of rocket launches

Elon Musk’s Space Exploration Technologies Corp. cleared a major hurdle toward routine launches of its massive Starship rocket from a Texas facility. The Federal Aviation Administration on Monday said the expanded launch site near the Gulf of Mexico in southern Texas would meet federal environmental requirements once SpaceX takes more than 75 measures to address the impact of local fish, wildlife, and plants. Those steps include monitoring by a qualified biologist and advance notification to surrounding communities about potential engine noise and sonic booms from launches. Opponents had argued the facility endangered fragile wetlands and wildlife. The decision is a boost for SpaceX’s goal of sending Starship to the moon and Mars, but it doesn’t guarantee the additional capacity will be used. The environmental review is only one step in the FAA’s approval process. ― BLOOMBERG NEWS

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SHIPPING

Thieves make off with 20 freight containers at Mexican port

Thieves broke into a freight storage area at the Pacific coast seaport of Manzanillo and stole 20 freight containers loaded with partly refined gold and silver ore and television sets, the Mexican Employers Federation said Monday. José Medina Mora, president of the federation, said the large-scale robbery was a sign of rising crime in Mexico. The state of Colima, where Manzanillo is, has not officially commented on the June 5 robbery. According to local press reports, about 10 armed thieves forced their way into a private freight dispatch yard near the port, subdued employees and then took several hours to search for the shipping containers they wanted. The thieves then apparently hooked up the containers to trucks and drove way with them. No sign of the containers, or their contents, has been seen since. ― ASSOCIATED PRESS

BEVERAGE INDUSTRY

Jack and Coke: Coca-Cola getting into the premixed cocktail business

Coca-Cola Co. said Monday it’s partnering with Brown-Forman Corp., the maker of Jack Daniel’s Tennessee Whiskey, to sell premixed cocktails. The canned Jack and Coke will be sold globally after a launch in Mexico late this year. A zero-sugar version will also be available. The move comes amid strong global sales of of ready-to-drink alcoholic blends, including hard seltzers like White Claw. Global consumption of ready-to-drink beverages jumped 26 percent in 2020 and 14 percent last year, according to IWSR Drinks Market Analysis, an alcohol market research firm. For comparison, global consumption of all alcohols was up 3 percent. Louisville, Ky.-based Brown-Forman has been making ready-to-drink cocktails since 1994, when it launched spiked lemonade, cola and apple juice in Australia. Atlanta-based Coca-Cola, by contrast, has been slower to add alcoholic drinks to its portfolio of 200 brands ever since selling off a California winery it owned in the early 1980s. Coke launched Lemon-Dou, its first ready-to-drink alcoholic beverage, in 2018 in Japan. More recently, it has launched Topo Chico Hard Seltzer, Simply Spiked Lemonade, and Fresca Mixed. ― ASSOCIATED PRESS

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