Haim; re > "leaving the Cat to safeguard the milk"<ggg>
I like that expression, and we were saying the same thing then
about higher margin requirements.
Also I've been very critical about the derivative market, mostly
in the context of the more exotic ones, and how they are layered
if I hold a futures contract for some coffee 10 years forward
that hasn't even been planted yet, there is no real assets behind
it, yet these contracts are used and traded as asset.
When they are used as assets, to borrow more money on, the layering
starts, some were down the line one or two of these default and a
domino effect sets in. Using derivatives as assets is what so many
of the big banks have got into and this was a way around
the minimum assets requirements, yet very few derivatives are based
on assets, but just some pie in the sky.
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Any way chances are the big forward position in coffee not planted
was created to pay a drug lord off for a cocaine delivery, and
the said drug lord as well as the person who bought the futures
from him already know KafenDehorseshit Plantation is a front set up and doesn't every intend to grow coffee, then when some one
who latter buys these contrasts finds out these coffee futures are on some company that if you go to Columbia has vanished with out a trace, do you think they blow the whistle ? Hell no they try and often do
pass them on to another mullet, or they hold them on their books
as assets and borrow money on them.
A futures contract is not a real asset and it should never be used
as some sort of collateral to borrow on or serve as a asset
to meet margin requirements. For you and I that is the case, but it
does not seem to be that way for the big international banks.
GreenSpam says these things are so complex that we can't understand them..and we don't need to look at them, the lenders police these
things, ya the lenders are often the man in the middle of a
Dope cartel, & I want to know just who is he trying to protect.
Jim |
