The MF Global scandal will eventually take its place beside Lehman, Enron, Merrill-Lynch, GM, Goldman-Sachs and the rest. Its tentacles reach far beyond Wall Street and City of London. It is landing, like an enormous cow-pie, into the lives of farmers on the American prairie.
There are legitimate participants in the commodities markets, doing legitimate business for good reasons. One reason is to stabilize feed costs for livestock producers.
From the Minnesota Star-Tribune:
Dennis Magnuson is a farmer, not a gambler. He trades in the commodity futures markets hoping to stabilize the cost of feed for the pigs he sells. The Austin, Minn., resident said he would never put his money into bonds issued by European countries flirting with economic collapse.
But the now-collapsed MF Global Holdings Ltd. may have done that for him.
Magnuson is among more than 100 Minnesota farmers estimated to have assets frozen as a result of MF Global's bankruptcy filing and an estimated $1.2 billion in missing customer funds. Most of the farmers didn't choose to do business with the huge brokerage house that has become one of the biggest financial failures in U.S. history. They invested through brokers or financial advisers who eventually used MF Global to clear trades.
On Thursday, members of the Senate agriculture committee, including Minnesota Democrat Amy Klobuchar, grilled the heads of the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) over apparent loopholes in rules that allowed farmers' commodity trades to end up in risky European bonds.
What??!!!???
The article is horrifying to read, but OS hopes you read it. The final paragraph is out quote of the day:
"I don't have a scandal meter," she said. "I just think it's another example of why we just can't let these financial firms run roughshod over people on Main Street or people who are doing nothing but growing crops or raising pigs. They should not have to know every in and out of the regulatory system to protect their money."
Ya'll--if Corzine and company don't go to jail for the rest of their lives, then Bernie Madoff is owed an apology. This is just the front end of the woes to befall this country from MF Global.
Remember who Corzine is, and who his HomeBoy in the White House is. Less than a year to go until we get to register our opinions at the ballot. OS just hopes someone can staunch the financial blood loss sufficiently until then.
Before this is over, Corzine will have loaded up the Gulfstream and high-tailed it to somewhere like Paraguay. He still has his passport, and access to all sorts of cash and assets everywhere.
Heaven help us.
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