What were the charts saying that time bonds gained 7 handles after Bernanke acted to prop up the bond market?
It has been a while since any action has been taken with QE money it seems, as bonds have been on the slide for some time now, despite a supposedly present fed bid?
It seems more logical to me that the commodity markets should break down before interest rates rise, rather than the former being the symptom of the latter.
Margin trading has a lot to do with borrowings after all, at least on this side of the pond. Indeed I find myself rather disturbed at the ever-lax standards of margin percentages being advanced ie. low deposit for even things like futures contracts, let alone blue chip stock positions.
Do they let people trade say, crude futures with $1000 margin over there?
Refco came a cropper when a number of customers lost more than their deposits, and then defaulted following large currency/metals moves. These bad debts were palmed off to some other firm - liberty I think it was - who were left holding the baby.
The "customers" of such nature as to bring about this dire situation with a cavalier broking operation I have heard were middle-eastern speculators who could merrily trade contracts by the score on a mere 5 figure sum.
Even if 100 punters found themselves facing $100k margin calls which they defaulted, we see a sudden cash-bleed of some $10m in no time flat!
And now, exchange requirements appear to be laxing again it would seem. Check out the "spread betting" firms that are popping up, let alone "fly by night" currency trading operations. (aka "stop hunters central"!)
I await the next scandal to break - Remember the move on gold when the refco scandal broke in 2005? - Markets will move if only as their positions are unwound....