refco securities LLC is the stocks and options branch of refco. refco llc, the futures + commodites branch did not go belly up (yet) but the CME announced they won't let refco to withdraw any money from the seggregated accounts. that inspires a lot of trust on refco...
If Refco can't withdraw any money from the futures accounts doesn't that imply that customers accounts are essentially frozen -- just by the CME instead of REFCO. That can't be good. :eek:
in addition to a personal editor you need to learn how to read. the writer did not say that 3000 employees are common scumbags in suits. he was probably saying that at the senior level of management there are people of that kind. furthermore while you may dispute this statement, it is well accepted that wall street is full of thieves in white shoes. as lucky luciano said on a visit to the floor of the NYSE,"I joined the wrong mob."
You've been touting this pig from the vantage point of a trader, I presume. The problem is that the situation at Refco is not in the hands of traders. It is in the hands of lawyers, regulators, and lenders. Let's assume you run money for me. A lot of money. I'm stupid and hysterical and I hear the news and I ask you to get my money out of Refco and you give me your jive about how it's safe. Here's what you know or should have known on Tuesday and Wednesday of this week despite your protestations that all is well because of this segregated account: 1. The company is in trouble. 2. They've dipped into those accounts in the past. That's a history. And until just today or yesterday, withdrawals were not supervised according to news reports. 3. Apparently there is no way to find out how much is in that account or whether there is a run on it. That's why you can hide behind your statement that it is 1B. There are scenarios such as a huge loss in one account holder affecting other account holders. 4. This company operates using many different LLCs or other entities. In fact, the instant fraud was comitted using some type of other related entity. And look at the case above I posted. They've done another scam as late as 1998 using the same modus. That's a history. Now something happens and there's a significant delay or other compromise of my ability to get my money from you because you're with Refco. Do you think you have a problem with me? I think so and I know the people that represent me will twist you eight ways to Sunday about you not protecting my money by convincing me on leaving it with this troubled company especially when you could have given it back to me . I'm willing to bet that there isn't a responsible lawyer on the planet that given the points I outline above would tell you Mr. Apex to leave your client money with Refco.
This might come as a surprise to you, but I have never once made a post telliing people that they should leave their money with REFCO Holdings, REFCO Inc, or REFCO LLC. Please show me where I have done so. In fact, on Page #20 of another thread from yeseterday I simply stated: "I suggest that if anyone is uncomfortable with a significant amount of cash in a trading account at REFCO LLC., then simply reduce your capital exposure and ask for a check to be cut. Simple as that." http://www.elitetrader.com/vb/showt...=56831&perpage=6&highlight=risk&pagenumber=20
Wrong. I have never touted REFCO from the vantage point of a trader. Historically, I have had a clearing relationship with Refco and have stated as such here on ET in previous posts. I have simply tried to put a dent into all of the bashing and highly misinformed and inflammatory posts that show a tremendous amount of ignorance when it comes to how an FCM works, what the CME's role is in this and what the fiduciary responsibility is of the ECC. These are all concepts that have been conveniently ignored by many of the posters here. Back to trading.
I've read in a book before, it mentioned in the history of futures industry, not a single client has lost money due to a FCM's financial problems. Assuming that statement is true, that explains why most people don't care about the regulation of FCMs. I hope the Refco case could shed some light on this issue.
Stick a fork in them.....they are done.....and get your money out.......this is a potential problem with any (strictly) futures firm....unless your money is in t-bills with YOUR NAME on them......you are at 100% risk. If I am wrong...please correct me.
APEX raises a point that people just seem to want to ignore -- that the funds in Refco's regulated futures business are segregated and thus provide a measure of safety given the oversight of the CFTC and backing of clearinghouses behind the exchanges. Does that mean that someone should leave their money with Refco? No. Does that mean Refco is going to survive? No. As far as the distinctions of which entity pulled out the debt, etc. -- I think this is moot. Refco, Inc. would have to gaurantee the debts on all of its subsidiaries so any debt in a subsidiary should be treated as debt for the entire company. No lender in their right mind would agree to any different structure.