“Most American investors unaware rehypothecation is widely practiced inside US, but more limited. Rehypothecation will be the problem!
US law permits moving US client accounts from parent company to subsidiaries in other nations,which enables their use as collateral for loans usable to invest in other securities. Now, clients can specify their assets may not be transferable to a foreign jurisdiction.
Jon Corzine used MF Global to transfer US client accounts to a subsidiary entity in London, where UK rules permitted much higher levels of rehypothecation (i.e .leverage up to 4X, US rule less than 1.5X). A iming to build giant enterprise w/other people’s money, it blew up.”
Dr. Harald Malmgren
“Whoever makes a fortune by a lying tongue
is chasing a bubble over deadly snares.
The soul of the wicked man desires evil;
his neighbor finds no pity in his eyes.
When the arrogant man is punished, the simple are the wiser;
when the wise man is instructed, he gains knowledge.
The just man appraises the house of the wicked:
there is one who brings down the wicked to ruin.
He who shuts his ear to the cry of the poor
will himself also call and not be heard.”
Proverbs 21:6, 10-13
They see him hyah
They see him theah
Those lefties see him everywheah
Is he in heaven?
Or is he in hell?
That damned, elusive deporabel
“Unto a stranger thou mayest lend upon usury; but unto thy brother thou shalt not lend upon usury: that the LORD thy God may bless thee in all that thou settest thine hand to in the land whither thou goest to possess it.”
— Deut 23:20