Guest
11-06-2011, 10:37 PM
Read this article in The Daily Beast about how the latest near Wall Street disaster involving the MF Global hedge fund headed by Jon Corzine, former Governor of New Jersey happened...
http://www.thedailybeast.com/cheats/2011/11/04/corzine-fought-oversight-at-mf-global.html?utm_medium=email&utm_source=newsletter&utm_campaign=cheatsheet_morning&cid=newsletter%3Bemail%3Bcheatsheet_morning&utm_term=Cheat%20Sheet
I could care less about whether the depositors in MF Global lose all or part of their money. They were investing in a hedge fund and should have understood the risks of investing in a highly leveraged business.
What honks me off is that Jon Corzine, leveraging his political influence with the five commissioners of the Commodity Futures Trading Commission, convinced them to permit MF Global to use the investor's money without them knowing about it instead of borrowing money from a bank. (He'd have had to pay interest on bank loans, but it's more likely that the banks wouldn't lend him the money for this purpose.) By doing so he and MF Global not only lost a lot of their investor's money but also took sizable enough positions on commodity futures trades to both screw up the efficient functioning of a market, but also threaten the operation of the broader financial markets as well.
There have probably been lots of examples of lobbying with the CFTC over the years. Another one that I've mentioned here was when Senator Phil Gramm's wife was appointed to be in charge of the CFTC and succumbed to similar lobbying by Enron Corporation. After approving Enron's requests for loosened regualtion, she resigned CFTC and took a job as a director of Enron and head of it's Audit Committee. We all know how that turned out, don't we?
Who are the commissioners who gave Corzine his way?
The Chairman is Gary Gensler--Prior to joining Treasury, Chairman Gensler worked for 18 years at Goldman Sachs, where he was selected as a partner. CORZINE WAS THE CHAIRMAN OF GOLDMAN WHEN GENSLER WAS MADE A PARTNER. HE OWED HIM ONE!.
Mark Wetjen--Working as a senior advisor for Majority Leader Harry Reid for many years, Wetjen was the Harry Reid’s point person in bringing the Dodd-Frank Act through the Senate. WHAT DID HE LEARN ABOUT FUTURES TRADING WHILE BEING A SENATE AIDE?
Jill E. Sommers--Commissioner Sommers has worked in the commodity futures and options industry in a variety of capacities throughout her career. In 2005 she was the Policy Director and Head of Government Affairs for the International Swaps and Derivatives Association, where she worked on a number of over-the-counter derivatives issues. Prior to that, Ms. Sommers worked in the Government Affairs Office of the Chicago Mercantile Exchange (CME), where she was instrumental in overseeing regulatory and legislative affairs for the exchange. During her tenure with the CME, she had the opportunity to work closely with congressional staff drafting the Commodity Futures Modernization Act of 2000. SHE WAS A LOBBYIST!!
Bart Chilton--Prior to joining the CFTC, Mr. Chilton was the Chief of Staff and Vice President for Government Relations at the National Farmers Union where he represented family farmers. HE WAS A LOBBYIST!
Scott O'Maila--Before starting his term at the CFTC, Commissioner O’Malia served as the Staff Director to the U.S. Senate Appropriations Subcommittee on Energy and Water Development, where he focused on expanding U.S. investment in clean-energy technologies, specifically promoting low-cost financing and technical innovation in the domestic energy sector. WHAT DID BEING A BUREAUCRATIC STAFFER TEACH HIM ABOUT COMMODITIES FUTURES?This is your government at work, folks. These are the types of regulators that will implement all those tough new regualtions established by the Dodd-Frank bill.
Are you impressed?
http://www.thedailybeast.com/cheats/2011/11/04/corzine-fought-oversight-at-mf-global.html?utm_medium=email&utm_source=newsletter&utm_campaign=cheatsheet_morning&cid=newsletter%3Bemail%3Bcheatsheet_morning&utm_term=Cheat%20Sheet
I could care less about whether the depositors in MF Global lose all or part of their money. They were investing in a hedge fund and should have understood the risks of investing in a highly leveraged business.
What honks me off is that Jon Corzine, leveraging his political influence with the five commissioners of the Commodity Futures Trading Commission, convinced them to permit MF Global to use the investor's money without them knowing about it instead of borrowing money from a bank. (He'd have had to pay interest on bank loans, but it's more likely that the banks wouldn't lend him the money for this purpose.) By doing so he and MF Global not only lost a lot of their investor's money but also took sizable enough positions on commodity futures trades to both screw up the efficient functioning of a market, but also threaten the operation of the broader financial markets as well.
There have probably been lots of examples of lobbying with the CFTC over the years. Another one that I've mentioned here was when Senator Phil Gramm's wife was appointed to be in charge of the CFTC and succumbed to similar lobbying by Enron Corporation. After approving Enron's requests for loosened regualtion, she resigned CFTC and took a job as a director of Enron and head of it's Audit Committee. We all know how that turned out, don't we?
Who are the commissioners who gave Corzine his way?
The Chairman is Gary Gensler--Prior to joining Treasury, Chairman Gensler worked for 18 years at Goldman Sachs, where he was selected as a partner. CORZINE WAS THE CHAIRMAN OF GOLDMAN WHEN GENSLER WAS MADE A PARTNER. HE OWED HIM ONE!.
Mark Wetjen--Working as a senior advisor for Majority Leader Harry Reid for many years, Wetjen was the Harry Reid’s point person in bringing the Dodd-Frank Act through the Senate. WHAT DID HE LEARN ABOUT FUTURES TRADING WHILE BEING A SENATE AIDE?
Jill E. Sommers--Commissioner Sommers has worked in the commodity futures and options industry in a variety of capacities throughout her career. In 2005 she was the Policy Director and Head of Government Affairs for the International Swaps and Derivatives Association, where she worked on a number of over-the-counter derivatives issues. Prior to that, Ms. Sommers worked in the Government Affairs Office of the Chicago Mercantile Exchange (CME), where she was instrumental in overseeing regulatory and legislative affairs for the exchange. During her tenure with the CME, she had the opportunity to work closely with congressional staff drafting the Commodity Futures Modernization Act of 2000. SHE WAS A LOBBYIST!!
Bart Chilton--Prior to joining the CFTC, Mr. Chilton was the Chief of Staff and Vice President for Government Relations at the National Farmers Union where he represented family farmers. HE WAS A LOBBYIST!
Scott O'Maila--Before starting his term at the CFTC, Commissioner O’Malia served as the Staff Director to the U.S. Senate Appropriations Subcommittee on Energy and Water Development, where he focused on expanding U.S. investment in clean-energy technologies, specifically promoting low-cost financing and technical innovation in the domestic energy sector. WHAT DID BEING A BUREAUCRATIC STAFFER TEACH HIM ABOUT COMMODITIES FUTURES?This is your government at work, folks. These are the types of regulators that will implement all those tough new regualtions established by the Dodd-Frank bill.
Are you impressed?