Dismal Futures With MF Global -Global Heist
This was forwarded to me by a colleague…Great letter
To: James W. Giddens, Trustee, SIPA Liquidation of MF Global, Inc. and Martin Glenn, United States Bankruptcy Judge
From: Cathy Cuthbert
RE: MF Global Heist
I am a lucky, former MF Global client. Unfortunately, I’m not a multi-billionaire who got the memo. I had a modest account that was supplying me with a modest livelihood, when suddenly one Monday afternoon, my account was frozen, my livelihood was essentially gone and four years worth of trading profits vanished into cyber space. You might be interested to know that sitting on my desk as I write is an application for a part-time, seasonal position stocking shelves at the local Rite-Aid. Then again, maybe not…
Let’s try a thought experiment. Suppose I worked at a little bank in Anywhere, USA and it just so happened that I had a few peccadilloes I needed to clean up. So I borrowed just a tad of money from a few clients’ accounts without it showing on their statements or anything – don’t want to alarm the little tykes – intending all along to of course return the money ‘cause ya know, I’m good for it, but somehow I just couldn’t come up with the bucks fast enough and somebody found out. Do you suppose I could just resign, go home and suck a sore paw while someone else looked high and low, under my desk, in my filing cabinet, maybe pieced together my shredded docs hoping to find out where, oh where the money went?
Don’t be ridiculous. Not only would I immediately be tased, hand cuffed and thrown into the slammer, hard evidence or no, but the money would be very quickly found since there is not one thin dime that passes between accounts in all of the entire USA that isn’t thoroughly and incessantly tracked anywhere and everywhere it goes. Not one thin dime. You fellas know it, I know it, but worse for you, the whole world knows it and I don’t have to tell you they are all watching.
Should I remind you that the key factor in any financial market is the belief of all the participants that the market is mostly fair? Oh, please, don’t call me naïve. I am well aware that futures trading is a negative sum game, and that there are plenty of shenanigans going on with bad fills, running stops and the like. That’s ok, though, since it is petty theft and we can figure out ways to stay in the game regardless. But what everybody needs to know is that nobody is going to clean out our accounts. We need to be assured that flagrant grand theft is simply out of the question. If the idea were to become credible that anyone’s account – or, as in this case, everyone’s accounts – can be stolen with impunity and with no recourse for the aggrieved, nobody in his right mind would be in the futures market.
You can obfuscate with legal mumbo jumbo about how depositing money into a futures account makes me an unsecured creditor, but I can assure you that you don’t want to go in that direction. Here’s why. If you use that excuse to pay off the Big Boys by letting them cut ahead of us clients in bankruptcy due to our status as unsecured creditors, what does that mean for my account at the friendly, neighborhood Bank of America? Steal from us MF Global clients, and the hoi polloi, who are already slowly but surely waking up to the banking scam, just might figure out that they, too, are unsecured creditors every time they deposit their paychecks.
Yes, Jimmy and Marty, you are staring in the face of not just a run on the futures markets, but a run on the banks.
Let’s stop pretending that you don’t know where the money is. Corzine got a margin call from the Big Boys and paid it. So claw it back. Yes, it’s that simple. A mere $600 million is not going to solve their multi-billion dollar problems, anyway. While you’re waiting for the clawback, you can make all the clients’ accounts whole with funds from SIPC if you have to. Forget this pathetic 60% recovery of collateral. Nothing less than 100% will do. And don’t forget to order Corzine his orange jump suit. Either he bunks with Madoff or no one will believe that this can’t happen again.
So here’s the deal. You can be the heroes or you can be the goats. You can take the high ground, convince the Big Boys that they have gone too far for their own good and return the futures markets to some semblance of reliability, or you could be the ones to kick the last prop out from under the vestiges of capitalism and send the world spiraling at an ever accelerating pace into a fascist future.
Sounds like a no-brainer to me.