THANK GOD ZERO HEDGE IS KEEPING US POSTED WITH WHAT IS REALLY HAPPENING. CNBC AS PER USUSAL ALONG WITH THE MAINSTREAM PRESS WAS ONLY TO HAPPY TO HAVE THE EXECUTIVES TELLING EVERYONE HOW GREAT IT ALL IS AT MF LAST WEEK. Even as we hear rumblings that the MF fire is spreading, and the associated auditor of the now infamous former Primary Dealer is about to get in serious hot water, the bankrupt company itself continues to dig itself an ever deeper grave. Because according to a just filed motion by the MF Global liquidating trustee, it seems that the gross criminal activity by the company may have been orders of magnitude bigger than anyone has expected. To wit: "As a result of the apparent segregation violations and the suspension of clearing privileges, more than 150,000 customer accounts essentially were frozen on October 31, 2011, of which more than 50,000 accounts were regulated commodities customer accounts. The CME estimates that MFGIâs current segregated funds requirement is approximately $5.45 billion. Moreover, the total amount of MFGI customer segregated funds on deposit at the CME is approximately $2.5 billion, and the clearing-level segregated collateral is approximately $1.5 billion or approximately 60 percent of the MFGI customer segregated funds on deposit at the CME." Doing some quick inverse addition and we get a (w)hole of $5.45 less $2.5 less $1.5 or $1.45 billion. In other words, the theft by MF Global was not stealing hunderds of millions form its customers: it has stolen a whopping $1.5 billion! For those confused, this is not a rogue loss of $1.5 billion, something which was enough to send UBS' Kweku to prison. This is outright theft resulting from illegally commingled accounts. Our only question is will $1.5 billion in theft be enough for the first real perp walk of an Obama-friendly Wall Street executive? http://www.zerohedge.com/news/mf-global-client-theft-estimate-doubled-15-billion
Please tell me this is sarcasm. I read Zero Hedge and think they do a good job at a lot of things but you have to take them for what they really are, a bias and at times, rumor mongering site. They are so incorrect on so many different posts that it actually baffles my mind. Take this post and most of their back of the envelope calculations with a grain of salt just like you would CNBC's search their site for their interpretation of margin requirements on European debt (dead wrong and wiped off the front page real quck) Calculation on ES futures and why they thought it was set up for a crash (LOL. really got owned on this one) Their last 1800 predictions on the collapse of the CME or "half-life" calculations on announcements.
What about money deposited with other exchanges like say ICE or with the options exchanges? Perhaps most of the 'missing' funds are on deposit elsewhere.
Why isn't this a big deal in the media? Everyone knows stocks and bonds are held at your broker in street name, and the money is never comingled, wink wink, but futures accounts? This is unbelievable. That money is marked every close and netted between clearing members and the CME clearinghouse every afternoon. We used to be able to make money in the pit, transfer it from our Clearing firm into our personal account at Burling Bank in the CBOT lobby and take it out in cash before happy hour was over in the Ceres Cafe. How the fuck can it just be gone, and CME CH has no idea where it is?
I cant even tell wtf is going on at MF from the reporting. No one knows how big a crook Corswine is , was, or will be.
Agreed ZH clearly has its biased views but those views are warranted considering how completely F&#(ED the entire system is at the moment. The fact that ZH is all over this MF story while the MSN is pretending like nothing happened tells me that there is a whole lot more to this story. WTF were the regulators in all this (they dropped the ball again). They are either incompetent or corrupt or even worse, there is something else going on here with counter party risk to eu debt that they are sitting on. Again either way there is something very troubling about the situation with mfg.
ZH the place if you dont like one bear headline, just wait, you will get another one in 5 minutes. And in the meantime the nasdaq is nearing 8 year HIGHS....hmm.. Although, sometimes they do have nice little gems of info, like the bank of america internal docs. etc.. You just have to look around for the good stuff. Its like banging a fat girl back in college, you fumbled around enough, you would find what you are looking for hahaha... EF
I wouldn't cal it as "THE MSM is pretending nothing happened" the truth is, you can just spit out articles on loose facts and opinions. Real Journalist get burned for this. You need to base an article on full facts. In the blog world.. You can write all the bullcrap you want and if its untrue...you can say oh well the facts are clearer now and by the way that article is on the 4th page of the website so no one will read it anymore anyways. You have to give the MSM more time for articles to come out
And there you have it, jefferies is having a heart attack and the market started tanking along with it. The magic wand seems to have taken over for the time being.