Merrill offers innovative temperature-linked note

[jpak]

http://www.reuters.com/article/environmentNews/idUSL2477291920070724

LONDON (Reuters) - Merrill Lynch is launching a two-year euro-denominated certificate that pays a return based on the average temperature in Rome, Italy, in a deal the firm says is the first of its kind.

The note aims to offer companies a way to hedge some of their exposure to the risk of hot weather and offers retail investors an alternative to stocks and bonds.

Jens Boening, head of EMEA weather derivatives structuring at Merrill, said the coupon on the note is based on the average temperature in Rome as measured over the course of a year from mid-September.

If the average temperature is over 16.38 degrees Celsius, the certificate will pay interest of up to 16 percent, with the full payout achieved if the average reaches 17.38 degrees, he said.

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[Speck Tater]

1. When will Wall Street admit that the stock exchanges

have just become big gambling casinos. They aren't really directly connected to financing productive enterprises like they were originally. Now it's just a big derivatives casino with little or no connection to reality.

[Nihil]

3. It's just an up-market Ladbrokes ...

... inhabited by - and run for the benefit of - parasitic scum who love
to get rich from gambling with someone else's money.

(Ladbrokes is a major chain of betting shops in the UK ... not sure if
they're in the US or not.)

[phantom power]

2. I wonder who gets to measure these temperatures.

"I'll let you make the rules, if I get to keep score."