Banks to Companies: No More Deposits, Please [WSJ]
Bankers say they thought the improving economy would reduce companies’ desire for holding cash, but deposit inflows have continued in recent weeks…. Top of mind for many big banks is a rule requiring them to hold capital equivalent to at least 3% of all assets. Worried about the rule’s impact during the pandemic, the Fed changed the calculation in 2020 to ignore deposits the banks held at the central bank, but ended that break this March. Since then, some banks have warned the growing deposits could force them to raise more capital, or say no to deposits.

Biden ends GOP infrastructure talks, but new group emerges [AP]
Shortly after the Biden-Capito talks collapsed, 10 senators huddled late Thursday over pizza — five Republicans, five Democrats — emerging after three hours with some optimism their new effort could create a viable path forward, said a person familiar with the closed-door talks and granted anonymity to discuss them.
At the same time, with anxiety running high as time slips by, Democrats are laying the groundwork to pass some or all of the ambitious package on their own. Biden conferred Tuesday with House Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer about launching the budget resolution process for Senate votes in July, the White House said.

Hedge funds book largest gains since 1996 on back of US reopening boom [FN]
The HFRI Fund Weighted Composite Index gained 1.7% in May, while the HFRI 500 Fund Weighted Composite Index advanced 1.5%.... The HFRI FWC has gained 9.9% through the first five months of 2021, the strongest year-to-date performance to May since 1996 and the longest period of consecutive monthly gains since the index produced 15 consecutive positive months ending January 2018./In the eight months to May, the HFRI FWC is up 21.9%, representing the third-strongest period on record.

Warren Buffett’s Berkshire Hathaway Invests $500 Million In Brazilian Challenger Nubank [Forbes]
Berkshire Hathaway's investment is an extension of the fintech's $400 million Series G round announced in January. Buffett's company also has StoneCo, a Brazil-based digital payments firm, among its tech investments in the region…. With both extensions, Nubank's eighth fundraising effort has reached $1.15 billion, the largest round ever raised by a technology company in Latin America. It is also the largest single investment so far for the company, who has raised $2 billion since its inception.

El Salvador becomes first country to adopt bitcoin as legal tender after passing law [CNBC]
“The purpose of this law is to regulate bitcoin as unrestricted legal tender with liberating power, unlimited in any transaction, and to any title that public or private natural or legal persons require carrying out,” the law reads.
Prices can now be shown in bitcoin, tax contributions can be paid with the digital currency, and exchanges in bitcoin will not be subject to capital gains tax…. The exchange rate with the U.S. dollar “will be freely established by the market,” according to the proposed law. El Salvador’s current official currency is the U.S. dollar.

Europe Has a New Cop on the White-Collar Crime Beat [WSJ]
The European Public Prosecutor’s Office, launched last week, will investigate and prosecute crimes involving EU funds and taxes…. Led by an anticorruption prosecutor from Romania, the EPPO is operating in uncharted territory. Without a criminal code of its own to enforce, it will have to navigate the disparate laws and judicial systems of its members to bring cases….
Up till now, the European Anti-Fraud Office, or OLAF, oversaw fraud and tax-evasion investigations, but it was constrained by its inability to directly prosecute cases where it discovered wrongdoing. Instead, it was forced to make referrals to national authorities and wait to see if they would act upon them.

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Opening Bell: 6.29.20

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