Hard-to-read rate hike signals from Fed.

Stocks look set for a steady open as investors digest mixed policy from Federal Reserve officials amid a debate on whether they will tilt to less aggressive interest-rate hikes. Futures rose for Japan and Australia and were little changed for Hong Kong, after US shares closed up on thinner than usual volumes. Shorter maturities led a climb in Treasuries that left the two-year yield at about 3.20%. A dollar gauge hit the highest in more than three weeks.

Photo: Angela Weiss | Agence France-Presse

Traders wait for $2 trillion Friday

With August shaping up to be the calmest month this year for US stocks, traders are closely watching Friday’s $2 trillion options expiration for hints whether the tranquility will last. At issue is the belief that derivatives markets have somehow played a key role in suppressing volatility, thereby compelling rules-based quant traders to buy shares and in turn luring a broader group of investors back into the market in order to chase gains. 

Powell will face a tough audience in Jackson Hole

Nearly a year ago, when US Federal Reserve Chair Jerome Powell delivered his speech at the annual economic conference in Jackson Hole, a global audience was hanging on every word for insights into the outlook for growth, inflation and monetary policy in an extremely uncertain environment. Given how mistaken his assessment proved to be, he'll have a harder time sounding convincing when he gives his next speech in the same venue later this month. (Bloomberg Opinion | Aug 18)

US junk bond market in powerful rebound on easing inflation worries

One of the riskiest corners of global financial markets has made an unprecedented recovery in the past month, with prices of junk bonds rebounding as investors bet that the Federal Reserve’s efforts to tame inflation will avoid triggering a deep recession. (Financial Times | Aug 16)

Federal Reserve finalizes guidelines for access to its payment systems

The Federal Reserve said Monday it would adopt a tiered approach toward determining whether to grant financial institutions access to its payment systems and signaled that cryptocurrency companies would be subject to a higher level of review. (The Wall Street Journal | Aug 15)

Labor shortage is vexing challenge for U.S. economy

As anyone who has lost luggage or waited half an hour for a restaurant check can tell you, America needs way more workers in some parts of the economy. Economists think so too. Many of them see the imbalance in labor supply and demand as at the heart of the U.S.’s current economic challenges. They say that fixing it is critical to achieving a so-called soft economic landing, in which the highest inflation in four decades comes down without unemployment rising enough to trigger a recession. (The Wall Street Journal | Aug 14)

(Aug 17) — The July 26-27 FOMC minutes showed policy makers were concerned about the financial stability challenges posed by digital assets. 

• Participants noted these assets, including stablecoins, were subject to vulnerabilities such as runs, fire sales, and excessive leverage — similar to those associated with more traditional assets
• “While the recent turmoil in digital-asset markets had not spread to other asset classes, these participants saw digital assets’ rising importance and growing interconnectedness with other segments of the financial system as underscoring the need to establish a robust supervisory and regulatory framework for the industry that would appropriately limit potential systemic risks”
• A few participants mentioned the need to strengthen the oversight and regulation of certain types of nonbank financial institution
• “Several participants noted capital at some of the largest banks had declined in recent quarters, and emphasized that it was important that the largest banks have strong capital positions and that appropriate settings of regulatory and supervisory tools can help deliver that outcome”
• A couple of these participants highlighted the potential role that usage of the countercyclical capital buffer could play in this context

Source: Alexandra Harris | Bloomberg Government

Ransomware group makes pilfered data searchable

A ransomware group known as Black Cat is waging an aggressive campaign against scores of companies in the US and Europe, adopting a novel technique to pressure victims into paying expensive extortion fees. In June, the group began making stolen data searchable on its website. Cybersecurity researchers at Unit 42, a cybersecurity team at Palo Alto Networks, have linked Black Cat's members to Russia.

— Bloomberg

Don’t rely on SMS alone for authentication, cyber experts warn

A cyberattack on Twilio and a rise in hacks using text messages show the technology’s flaws. The two-factor authentication process adds protection to systems by requiring users to verify their identity through more than just a password. Often, this takes the form of a verification code sent by text message – or SMS – or voice calls, but these systems are becoming increasingly out of date.

— The Wall Street Journal

Russia-linked cyber espionage attacks disrupted in US, UK

The Seaborgium hacking group has targeted more than 30 organizations since the start of the year, mainly in the U.S. and U.K., with some campaigns launched against groups in Ukraine and NATO members, Microsoft cybersecurity researchers said Monday. Seaborgium, which Microsoft's threat-intelligence center has tracked since 2017 and said originated in Russia, in some cases used Microsoft accounts, which the company has disabled. The group uses phishing email, fake LinkedIn profiles, and social engineering to penetrate systems over time. Details on how to recognize Seaborgium activity are here. 

— The Wall Street Journal

Road to Rio? In a world reshaped by the pandemic, war and soaring prices, a clutch of aspiring global cities is luring a wave of adventurous expats. Photo: Buda Mendes | Getty Images

New expat hotspots

As Covid lockdowns, political upheaval and soaring costs drive expats from Hong Kong, and rival Singapore raises the bar for imported labor, young professionals looking for adventure and careers abroad are facing a dilemma. Where next? In a bid to identify the cosmopolitan hotspots of the future we spoke to six workers who, from the beaches of Rio to the tech hub of Bangalore, are taking the road less traveled.

— Bloomberg | City Lab + Wealth

100 tips for a better life

One of them... You can improve your communication skills with practice much more effectively than you can improve your intelligence with practice. If you’re not that smart but can communicate ideas clearly, you have a great advantage over everybody who can’t communicate clearly.

— LessWrong

How to make your old phone last

Follow these steps to save battery life, improve speed, and reduce wear on your older iPhone or Android model, especially if its operating system hasn’t hit its expiration date yet.

— The Wall Street Journal