All posts by jiefelliu2017

Controlling Asian carp remains a challenge

By Jiefei Liu

Current barriers against Asian carp temporarily protect the Great Lakes, but fighting the invasive fish remains a challenge.

Michigan Gov. Rick Snyder announced Jan.17 a $1 million challenge for innovative solutions to the voracious carp. The challenge will be launched officially in mid-summer 2017, said Joanne Foreman, coordinator of Invasive Species Program communications at the Michigan Department of Natural Resources.

Currently, the U.S. Army Corps of Engineers operates three measures to deter fish in the Chicago Area Waterway System. According to the 2017 Asian Carp Action Plan of the Asian Carp Regional Coordinating Committee, electric barriers in the Chicago Sanitary and Ship Canal give off electrical stimuli to deter the carp. A Bypass Barrier physically blocks known bypasses around the electric barriers caused by flooding. The third barrier is bar screens on sluice gates at a key lock and dam in the Calumet Sag Channel south of Chicago.

Foreman said that in a recent test non-carp species were introduced near an electric barrier, and it was found that some small fish were able to make their way through the barrier.

Continue reading

Designer toy shop adjusts to changing market

By Jiefei Liu

“Things come in and out of style,” said Whitney Kerr, president of Rotofugi Inc., a designer toy shop in Lincoln Park.

The store features imported artsy toys from around the globe, ranging from $500 vinyl toys by Otto Bjornik to $4 Pokemon figure strap capsules. A gallery space is now occupied by a pop-up shop of Yummy World by Kidrobot, an art toy retailer.

It will have been 13 years this summer since Whitney Kerr and her husband Kirby Kerr opened the store, and will be the ninth year since they have struggled to recover from the 2008 financial crisis.

The revenue of the shop steadied around $1 million, but costs have gone up, Whitney Kerr said. Gross margin went down to 38 percent in 2016, compared with 44 percent in 2015, she added.

The Kerrs started the store as a super collectors’ business where these collectors would spend several hundred dollars on collectables, such as limited toys by various artists from California, New York or Hong Kong, Kerr said, but there are fewer and fewer of them.

Continue reading

Comic book store: more than superheroes

By Jiefei Liu

“Superhero comics are selling best because that’s what people are familiar with,” said Raphael Espinoza, manager at Chicago Comics Inc., but it is other comics that make this store stand out.

The store, located on North Clark Street, in Lakeview, sells approximately 55 percent superhero-related comics, 25 percent non-fiction and 20 percent crime and horror comics, Espinoza said.

The 26-year-old Chicago Comics store sells many old issues of comics and a wide variety of graphic novels, including fictional and non-fictional, said Eric Kirsammer, the owner, motioning toward a wall of old comics behind the counter.

“They have a good selection of older comics from the 1980s or 1990s to comics that are being released now,” said Colin Finn, who came to the store with his brother.

Together with another book store Kirsammer owns, the business grosses over $1 million a year, of which one-third comes from the book store and two-thirds from the comic book store, which has five employees, Kirsammer said.

Continue reading

Bats acquisition boosts confidence in CBOE

By Jiefei Liu

Chicago-based CBOE Holdings Inc. is riding high on its just-completed $3.4 billion acquisition of Bats Global Markets Inc. as analysts and investors focus on the global markets and cutting-edge electronic trading technology that CBOE gains in the deal.

Optimism about the newly combined company has overcome concerns about falling profit and rising expenses at CBOE in the past year that are expected to continue in 2017.

Seven out of 13 analysts surveyed by Bloomberg suggest that investors buy shares of CBOE, compared with one out of 15 in the year-ago period. Demand for the shares may also get a boost from their inclusion, announced Monday, in the Standard & Poor’s 500 index.

Wall Street is betting that the Bats acquisition will more than offset a decline in volume in recent months stemming from historically low market volatility. Exchanges such as the CBOE derive revenue from each transaction done through the exchange.
Continue reading

Market volatility boosts CME earnings

By Jiefei Liu

CME Group Inc. reported strong fourth-quarter earnings Thursday, driven by high trading volumes amid market volatility.

CME Group, the Chicago-based derivatives marketplace, reported net income of $373.4 million, or $1.10 per diluted share, up 28 percent from $291.7 million, or 86 cents per share, a year earlier. Analysts’ expectation was $1.06, according to Bloomberg.

CME Group’s fourth-quarter revenues reached $912.9 million, 12.2 percent above $813.8 million in the year-ago period.

Full-year earnings rose to $1.53 billion, or $4.53 per share, 23 percent above last year’s $1.2 billion, or $3.70 per share. Revenues gained 8.1 percent to $3.6 billion from $3.3 billion, with a record daily volume of 15.6 million contracts in 2016.

Continue reading

Nasdaq Stock rallies despite net loss

By Jiefei Liu

Despite reporting a quarterly loss, Nasdaq Inc. beat expectations and its stock climbed 3.46 percent.

Nasdaq swung to a net loss of $224 million, or $1.35 per diluted share, from a net income of $131 million, or 77 cents per share, a year earlier primarily due to writing down the eSpeed trade name, Nasdaq’s U.S. Treasury Security electronic trading platform.

Excluding the impact of the writedown and restructuring costs, the company reported non-GAAP diluted earnings of 95 cents per share, surpassing analysts’ expectation of 94 cents polled by Bloomberg.

It reported $599 million revenue in the fourth quarter, up 12 percent from last year’s $536 million.

Continue reading

Metals markets get a Trump boost

By Jiefei Liu

Metals markets are rallying, due to expected economic growth and inflation pressure, and insiders expect the trend to keep going for some time.

The S&P GSCI Industrial Metals Index, a barometer for manufacturing, closed at 312.12 Wednesday, 32 percent higher than one year ago.

Copper for March delivery settled at $2.71 per pound Wednesday, up 0.15 cent on the COMEX of CME Group Inc.

President Donald Trump brings the prospect of U.S. economic growth “due to fiscal stimulus and spending on metals-intensive infrastructure” which push metals markets upward, said Caroline Bain, a commodity economist at Capital Economics Ltd., in an email.

Continue reading

U.S. consumer prices rise the most since mid-2014

By Jiefei Liu

The U.S. consumer price index rose for a fifth consecutive month in December, driven by rising shelter and gasoline prices.

The CPI, which measures the price of everything from cereal to medical care, climbed 0.3 percent from the previous month, and 2.1 percent from a year ago, according to the U.S. Bureau of Labor Statistics.

It was the largest yearly increase in two-and-a-half years and puts consumer price inflation above the Federal Open Market Committee’s 2 percent inflation target.

The core CPI, excluding volatile food and energy prices, increased 0.2 percent from the previous month and rose 2.2 percent from the prior year.

Continue reading

Does Dodd-Frank swaps regulation reduce market risk?

By Jiefei Liu

Derivatives experts differ on the effectiveness of the Dodd-Frank Act’s regulation, placed into effective in 2012, that over-the-ounter swaps be cleared through an established clearing house such as that of the Chicago Mercantile Exchange.

The Act brings comprehensive regulations to swaps, because these previously unregulated products “were at the center of the 2008 financial crisis,” states the U.S. Commodity Futures Trading Commission’s website.

A swap is a derivative contract through which two parties exchange financial instruments, according to Investopedia. The most well-known kind of swap is an interest rate swap, where two parties make payments to each other based on how interest rates move in favor of or against each one of them. In short, it’s like they are betting the trend of interest rates against each other. Credit default swaps, another type of swaps that are thought to be responsible for the 2008 financial crisis, are like betting whether a company will default on its bonds.

Continue reading