It has been nearly three weeks since MF Global Holdings Ltd. filed for bankruptcy and its futures commission merchant and broker/dealer went into liquidation and more than three weeks since we learned that they were in distress, yet we seem further away from an explanation as to what happened. (more…)
The official statement regarding reports that French bank Societe Generale was selling its stake in futures broker Newedge is that they “do not comment on market rumors.”
The bank did put out a news release earlier in September describing “transformation” efforts by the bank that would reduce its exposure to sovereign debt, lower it s leverage and control costs. (more…)
Just as we began to have serious discussions regarding a Fed exit strategy, the economy gets hit with a series of very poor economic reports and we are hearing chatter about a double dip recession.
Today’s employment situation report showed growth in nonfarm payrolls of 54,000, about 120,000 fewer than were expected and that expectation was dropped this week due to other weak economic news. Namely Wednesday’s Institute For Supply Management’s (ISM) manufacturing index.
In today’s metals update, Jon Nadler says he was watching CNBC and Jim “Mad Money” Cramer had remarked that silver has become the new “Amazon.com” to day traders. He even says that new traders shouldn’t have a problem buying fresh silver. He goes on to say that if you haven’t bought silver, then you should. There are a number of things that could be said that, but at a minimum, it adds ammunition to those that are cautioning that silver is in a bubble and ready to burst. (more…)
There has been a controversy brewing for several years on the affect of speculation on markets. It started in earnest in the summer of 2008 when crude oil exploded near $150 per barrel and is back with us as crude is back North of $100 and gold and silver are at or near all time highs.
It is a particularly dangerous time as the Commodity Futures Trading Commission (CFTC)is contemplating final rules on commodity position limits.
Ever since the announcement that NYSE Euronext and Deustche Borse were in advanced merger talks people have been speculating on whether CME Group, the other 800-pound gorilla in the room, would attempt a counter offer for fear of becoming undersized relatively.
Congress has codified in the Dodd-Frank Act the argument by America’s Fortune 500 that they cannot “afford” to comply with exchange/clearing margins. Such a regime, they say, would constrain their growth and development (jobs!), not to mention their Good Works (puppy shelters?). And so, industrial and commercial giants will be able to remain largely outside the remit of federal oversight by continuing to hedge with swaps on a purely private basis. We are talking here about many if not most of the trades that existed prior to the recent financial crisis. (more…)
There has been a lot written to try and explain the banking bailouts, especially the Troubled Asset Relief Program (TARP). Recently, a lot has been made about these TARP loans actually being profitable for the U.S. government. Additionally, a few places have begun uncovering the actual cost of the bank bailouts. (more…)
It has to be tough being a high frequency trader (HFT) right now. Not only does nobody outside of the trading world know what you actually do for a living, but a number of those who do know question whether HFTs should even exist. What’s more, HFTs have quickly become the ultimate scapegoat for any trading problems that arise. The May 6 “Flash Crash” is a perfect example of the finger being hastily pointed in HFTs’ direction. (more…)
