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MF Global announcement
- Thread starter 1nibbler
- Start date
Effective immediately, and until further notice, CME's Emergency Financial Committee, in accordance with rule 975, is limiting all trading for customers of MF Global for liquidation only.
In addition, and until further notice, CME Group will no longer recognize MF Global or any of its divisions as a guarantor for purposes of floor trading privileges.  Accordingly, floor brokers and traders guaranteed by MF Global or its divisions may not access the trading floor.  The foregoing actions have been taken based on circumstances regarding the financial condition of MF Global.
CME Clearing will process any transfers at the last settlement price at the request of customers.  Such positions will need to be re-margined at transferee firm.  Customers wishing to execute a liquidating trade should contact MF Global.
The sender provided the following contact information.
  Sender's Name: CME Globex Control Center
  Sender's Email: gcc@cmegroup.com
  Sender's Contact Phone: 3124562391
In addition, and until further notice, CME Group will no longer recognize MF Global or any of its divisions as a guarantor for purposes of floor trading privileges.  Accordingly, floor brokers and traders guaranteed by MF Global or its divisions may not access the trading floor.  The foregoing actions have been taken based on circumstances regarding the financial condition of MF Global.
CME Clearing will process any transfers at the last settlement price at the request of customers.  Such positions will need to be re-margined at transferee firm.  Customers wishing to execute a liquidating trade should contact MF Global.
The sender provided the following contact information.
  Sender's Name: CME Globex Control Center
  Sender's Email: gcc@cmegroup.com
  Sender's Contact Phone: 3124562391
The largest unsecured creditors include JPMorgan Chase Bank NA, as trustee for holders of $1.2 billion in debt, and Deutsche Bank Trust Co., as trustee for holders of $690 million in debt.
It wasn't that simple... The killa wasn't just that they had these BTPS, but the ginormous periph repo book. The two, in combination, is what kills you, Bear-style.Quote from benwm:
So MF Global invested $6 billion in sovereign bonds issued by European countries, presumably when they started doing this they must have thought they were "risk free" investments, and then Corzine kept doubling up.
They can't be the only one to have doubled up on European sovereign debt.
Do we know who else holds large European sovereign debt relative to their size? They may be next...
Quote from Martinghoul:
It wasn't that simple... The killa wasn't just that they had these BTPS, but the ginormous periph repo book.
I understand what a repurchase agreement is, but please could you elaborate on how they got killed on the repo positions?
Presumably if they owned the BTPs they would be financing each day by repoing out the bonds...are they paying high repo rates to finance the long positions because noone wants them as collateral?