Bye-bye reg T

Quote from Arnie:

Except for accounts of registered broker-
dealers and members of a national futures exchange, the pilot program requires that each portfolio margin account contain at least $5 million of minimum equity. If the account becomes in deficit for any reason, all margin calls must be met by the next business day

That was for the pilot program. Read on. The post-pilot proposals potentially waived the $5million. It certainly isn't clear one way or another if there is going to be an equity minimum and when this is going to be available to the masses if at all.
 
Quote from zdreg:

this reg t change will languish for years the same way as changes in the uptick rule.

That must be what prop firms are hoping. At the same time, although prop firms might lose the business of "semicapitalized" traders after the new rules are in place, they should continue to retain the truly "undercapitalized" traders. Then again, maybe more and more new prop firms will spring up since the new margin rules would provide more leverage to semicapitalized traders and allow them to back undercapitalized traders.

Now I understand what that "SPECIAL NOTE ON THREATENING REGULATORY DEVELOPMENTS" posted by Green Company was referring to when it said:

"There are other changes brewing in the margin rules that can help retail traders (hedging margin and more)."
 
So would this actually help the "retail" stocktrader? I'm talking about the equity trader that typically just buys and sells stock all day. Will he get more then the current 4:1 allowed on an intraday basis? Or do these new rules only apply to overnights?

-Guru
 
Lets pass the risk to the next guy

.. http://www.futuresindustry.org/

go to right side under E_CLIPS and click on the article: Financial system is a game of pass the parcel.

Someone once said the banks are immune from a financial meltdown because they repackage their risks and send then down the road for others to worry about. this should help some understand risk is always present. LOL
 
Alright! Happy days are here again! Just what we need, get 'em up on the launching pad, and then let the good times roll with increased buying power. Looks like 1999 redux, or it will be, coming up.

Can the good ole days of 10% margin to buy stocks (like in the twenties) be far behind? Don't worry, be happy! And yes, with all the fancy hedging, why, all the net risk is offset.

Unh huh, yeah, right.

It is, until it isn't.

Yep, it's a shame, and a bad use of capital when you can only lever it 2/1, why them hedge funds must be bemoaning that all day long. And when they can only lever it 3, 4, 5, or 10/1, that may still not be enough.

Why not just say, heck with it, 100/1 on stock, and you can borrow the 1.

It should be interesting to see the net of all this, roller coaster up, roller coaster down. WEEEEEEEEEEEEEEEEEEE!

Leave it to the brokerage industry to keep coming up with bigger and better ways to sell stock at high prices. I guess they'll be putting some lipstick on these pigs, and taking them to market.

You gotta hand it to them, more buying power, more leverage, and yet reduced risk. More taste, less filling.

This is gonna be good, stick around.
 
This is bad. Already too much liquidity and too many hedge funds. Increasing leverage, while asking for more transparency and oversight, as the prospect of increased volatility looms?? It doesn't even look good on paper.
 
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