CME...............Too big to fail (US Tax payer bail out line up)

[Mega]

http://www.daltonfinancialnews.com/2012_07_24_CME.html

Not long now.....
Mike

[globaleconomicollaps]

Re: CME...............Too big to fail (US Tax payer bail out line up)

http://www.daltonfinancialnews.com/2012_07_24_CME.html

Not long now.....
Mike

The article in full:

CME Trying to Find Methods to Hold Customer Funds
Dalton Financial News - 24th July 2012

The incidents with MF Global and Peregrine have triggered feelings of mistrust in many Futures Traders, so much so that the CME Group are set to totally change the way Futures Brokers operate.

A proposal being put forward by the CME Group suggests that Futures Brokers shall not be allowed to hold any customer funds beyond the exact amount needed to back their clients trading positions. Under the proposal, all funds would have to be held at the CME's Clearing House.

The proposal states:

“We are exploring the concept of having clearing houses or other depositories hold all customer segregated funds while returning any interest earned on that money back to the [futures brokers], increasing protections while preserving the operating model for the vast majority of firms who respect and comply by the rules.”

Critics are stating that the move is a play in the CME Group's favour. The move would essentially make the CME Group "too big to fail" as any losses incurred would be covered by government provided insurance. Essentially, this passes any losses on to the Tax Payer.

James Kontoulas, head of Typhoon Capital Management, had this to say about the proposal:

“Centralizing everything at CME and creating one gigantic point of contact ends up putting the government and ultimately taxpayers on the hook if CME fails"...

“CME is now considered too big too fail.”

[doom&gloom]

Re: CME...............Too big to fail (US Tax payer bail out line up)

Let it buuurrrrnnnnnnnnn!



From the ashes will rise a new and better model that is not so corrupt.