Would Maverick or anyone else care to look at the CFTC FCM data from say May-September of this year? I'm honestly looking to see if anybody saw the same things that I saw with this firm in mid-summer. A guy on another thread thinks it was a glitch that their adjusted capital went negative in July because it was bookended with seemingly normal capital levels in the month prior and after.
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Thanks for everything Jon Corzine
- Thread starter Maverick74
- Start date
Quote from RCG Trader:
Maybe I am simple, and I do not deny it. But I do not see how this any different than trying to average down. He blows up, but he blows up with OPM, which is illegal, so I am told.
It's 100x worse for one very simple reason. If traders, funds, etc. have no faith that "segregated capital" is indeed segregated, this could and would have serious ramifications for other firms. We've already tested the "faith" of market participants in the past 3 years, now that we're still seeing evidence of this type of behavior, it's really not a positive development.
Quote from denner:
Would Maverick or anyone else care to look at the CFTC FCM data from say May-September of this year? I'm honestly looking to see if anybody saw the same things that I saw with this firm in mid-summer. A guy on another thread thinks it was a glitch that their adjusted capital went negative in July because it was bookended with seemingly normal capital levels in the month prior and after.
I took a look at it. The problem here is that it's my understanding the net capital requirement is not the issue. MF has a separate division that clears the trades of it's hedge fund Man Financial. This is completely separate from the customer assets. Obviously he can't take the customer assets and buy illiquid sovereign debt with it. He had to use the proprietary capital. The issue is (I believe) that he no longer had the credit to hold the debt so he somehow used customer assets as collateral against the sovereign debt. He obviously didn't use all of it as all of it is not gone. And at this point, it's an allegation, not a fact. The other issue is trying to mark this sovereign debt which during a crisis event is impossible. So their capital requirements are going to be all over the place.
This announcement went out tonight via CME:
In connection with the commencement of SIPC insolvency proceeding against MF Global Inc., pursuant to CME/CBOT/NYMEX Rule 976, the President of the Clearing House is announcing that MF Global Inc. is deemed insolvent and is automatically suspended as a clearing member.
In other news, anyone see Penson's stock price recently? Not looking good.
Quote from Maverick74:
I took a look at it. The problem here is that it's my understanding the net capital requirement is not the issue. MF has a separate division that clears the trades of it's hedge fund Man Financial. This is completely separate from the customer assets. Obviously he can't take the customer assets and buy illiquid sovereign debt with it. He had to use the proprietary capital. The issue is (I believe) that he no longer had the credit to hold the debt so he somehow used customer assets as collateral against the sovereign debt. He obviously didn't use all of it as all of it is not gone. And at this point, it's an allegation, not a fact. The other issue is trying to mark this sovereign debt which during a crisis event is impossible. So their capital requirements are going to be all over the place.
This announcement went out tonight via CME:
In connection with the commencement of SIPC insolvency proceeding against MF Global Inc., pursuant to CME/CBOT/NYMEX Rule 976, the President of the Clearing House is announcing that MF Global Inc. is deemed insolvent and is automatically suspended as a clearing member.
In other news, anyone see Penson's stock price recently? Not looking good.
Interesting...and yes Penson has been looking like a dead dog for awhile now. Someone on here started a thread about it a few months back concerned about where they were parking the excess cash in customer's accounts..(i.e. money market funds).
Quote from bigarrow:
On a related note I had 2 sell on the ES @ 66 & 64 orders this morning with transact, clears through MF Global. Called transact and couldn't find out if the orders are filled or not or what is going on. I asked if it showed I was flat that should be correct and the guy said I sure hope so. I've got another account but nothing to do not knowing what my status is .
Any update?
Quote from denner:
It's 100x worse for one very simple reason. If traders, funds, etc. have no faith that "segregated capital" is indeed segregated, this could and would have serious ramifications for other firms. We've already tested the "faith" of market participants in the past 3 years, now that we're still seeing evidence of this type of behavior, it's really not a positive development.
I guess my response to this statement would be when will we finally see that the Wall Street vs. Main Street is not symbiotic. It is a predator vs. prey relationship. Every chance I get I try to spread this message. If you want to put capital to work, lean how to do it on your own. We are in the information age. Learn it, or take your chances.
Quote from RCG Trader:
I guess my response to this statement would be when will we finally see that the Wall Street vs. Main Street is not symbiotic. It is a predator vs. prey relationship. Every chance I get I try to spread this message. If you want to put capital to work, lean how to do it on your own. We are in the information age. Learn it, or take your chances.
I still don't think you understand. Let me try this angle. Say you have an account at IB and you are "doing it on your own". All is well with the world as you are trading your own money and doing well. Then IB decides they are going to buy 100 billion in sovereign debt. Then they get into trouble and take money out of your IB account to cover the collateral. Then the debt blows up in their face and suddenly half your trading account is gone. You never "invested" in this debt. You were never involved in any fund. You never agreed to buy this debt. But now "you" are on the hook for the losses. It it becoming more clear now for you?
This is not about losing money. This is not about a bad bet. This is not about investing in a hedge fund and losing. This is not even about bad risk management. It's about outright theft!!!!! Is it a little more clear now for you?
RC G here's an analogy from my main business, construction. You pay my company to build an addition and remodel your home. I don't pay my suppliers or subs, I use your money for other uses. The sub-contractors and material suppliers file liens on your house, you get kicked out and are homeless and bankrupt. Now that wouldn't be such a harmless or innocent error then. Except large corporate thieves are even worse, they can steal from thousands of people at the same time.
F*ck me running. This guy was levered 80 to 1 on the most toxic garbage known to man! Wow. I'm speechless.
http://www.forbes.com/sites/robertl...ad-mf-global-leveraged-80-to-1/?feed=rss_home
http://www.forbes.com/sites/robertl...ad-mf-global-leveraged-80-to-1/?feed=rss_home
Quote from Maverick74:
I still don't think you understand. Let me try this angle. Say you have an account at IB and you are "doing it on your own". All is well with the world as you are trading your own money and doing well. Then IB decides they are going to buy 100 billion in sovereign debt. Then they get into trouble and take money out of your IB account to cover the collateral. Then the debt blows up in their face and suddenly half your trading account is gone. You never "invested" in this debt. You were never involved in any fund. You never agreed to buy this debt. But now "you" are on the hook for the losses. It it becoming more clear now for you?
This is not about losing money. This is not about a bad bet. This is not about investing in a hedge fund and losing. This is not even about bad risk management. It's about outright theft!!!!! Is it a little more clear now for you?
Ahh, yes, very much so, thank you for clearing that up for me.