Forum Post: MF Global another looser at the poker table.
Posted 13 years ago on Oct. 31, 2011, 10:40 p.m. EST by demcapitalist
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Those of you who pay close attention to wall street heard the news of MF Globals bankruptcy filing today. It's being described as a mini Lehman bros. Citizens can't get mortgages or small business loans but firms like MF Global can get loans so that they can make risky bets. When they make a bet using mostly borrowed money and the bet goes wrong they can end up with less than zero in a hurry, that's why these failures are so destructive to the economy. If I have $1 and borrow $9 make a $10 bet and loose $ 2 I'm insolvent ,this is a simplified description of leverage. Futures are leveraged bets to begin with and investment banks add more leverage when they borrow to make these bets. That's why so many banks failed when home prices went down just a small percent. That's why these firms fall so hard and take down so many others when they fail. MF lost their money buying distressed European debt. They borrowed to make the bets and apparently they may have also"borrowed" from customers accounts to cover up losses when the bets went the wrong way. The winners are the ones using borrowed money to make leveraged bets who are right, they make a fortune, the losers end up with us bailing them out and the little guy trying to start a small business can't get a loan. I know you protestors are mad , I'm mad but I hope that you will all do much reading about how the system works so that we can change it in a productive way. Thanks for braving the cold and the police ---------but don't forget to study.
Former NJ Gov and Obama supporter John Korzine is the culprit. Even Obama couldn't save him. Damn those Germans. They just wouldn't continue with the socialist agenda of southern Europe. One more reason to run, not walk away from socialists like OWSers
One more reason to regulate the banks and our money. I'm still waiting for the free market tea party bank to open. You folks need a bank that is not socialist, in other words not insured by me thru the FDIC. When you open that bank and you all put your money there I will listen to you, until then I think you are FOS. You want socialized bank insurance and privatized profits and you can't have it both ways.
Looser than yer ma?