Despite the fact we had the Fannie Mae and Freddie Mac, Lehman and AIG, the “system” has not changed. It is still possible to not know where the money of MF Global clients is. Regulators are chasing, but are not catching anything. It is still astonishing, the MF Global “event” could happen. Regulators obviously do not talk to each other, and therefore there is nobody responsible. With regulators not able to keep track of where the money is, we can’t but ask ourselves how the regulation of the HFT will proceed? Video with Nomi Prins on the MF Global below;
Yesterday was another pathetic questioning in the MF Global scandal. It is rather clear, the financial industry is a highly unregulated area, poorly overseen by the regulators. The story is always following the same path, the CEO, the CFO, the board did not know anything. The Risk manager seems always to have been asleep. The same goes for Soc Gen, UBS and now MF Global. We can’t but wonder what do these high fliers get paid for? While staying at the Ritz Carlton, Corzine was asked some more questions during yesterday’s hearing. One of the better “live” articles on the matter, by National Hog Farmer. To be continued, that’s for sure;
Committee questions on Tuesday, a trio of MF Global executives may have thought they’d slipped the noose. In the face of increasingly exasperated committee member questions, the executives – responsible for the eighth-largest bankruptcy in U.S. history and the odd, potentially criminal, loss of an estimated $1.2 billion in customer funds – exhibited amnesia symptoms, reciting a wide range of variations on “I don’t recall.”
But immediately after the executives were dismissed, the CME Group’s Terrance Duffy gave testimony under oath that contradicted former MF Global head Jon Corzine’s claims of ignorance regarding the disappearance of customer funds.
In the days just prior to MF Global’s demise, CME – tasked with auditing MF Global’s futures business – had auditors reviewing the firm’s segregation reports. The Oct. 26 and Oct. 27 reports, said Duffy, showed the firm in full compliance.
Earlier during the weekend, there was some confusion regarding the interpretation of the CME late Friday press release. This is now cleared, and ICE is joining the CME’s lowering of margin with regards to MF Global event. The World is back to normal…..
ICE lowers margin due to the MF Global situation.
Effective immediately, ICE Futures U.S. is temporarily
lowering the Initial Margin rate for all Speculative accounts to a
level equal to the Maintenance Margin rate for all contracts. The
Initial Margin rate for hedgers already is the same as the
Maintenance Margin rate.
This action is being taken to mute the impact of the transfer of
accounts from MF Global Inc. to other clearing members that
was effected overnight, and thereby support the integrity of
CME full clarification below.
Weekend quiz. What does the below CME press release actually mean? Massive margin calls on Monday? Is the MF Global ghost sending chills across the clearing world whether people actually know what is cleared, netted and hedged? Just like Zero Hedge points out, it took just a few days to break the Money Markets last time around when Lehman went bust.