Posted on 10/31/2011 11:13:55 AM PDT by kcvl
Besieged broker MF Global filed bankruptcy today after a frantic effort over the weekend by CEO John Corzine to strike an out-of-bankruptcy sale came up short.
MF Global had a tentative deal to sell assets to Interactive Brokers Group as of late Sunday, but the agreement fell apart as talks continued overnight, people familiar with the matter said. Discussions ended around 5 a.m. Eastern Time, one of these people said.
MF Global had been considering filing just its holding company for bankruptcy protection and then executing the sale. That plan is now off the table, one of the people said. This person said MF Global's parent company would be included in the bankruptcy filing.
Voluntary bankruptcy petitions for MF Global Holdings Ltd. and MF Global Finance USA Inc. hit the docket in a US bankruptcy court in Manhattan mid-morning Monday.
http://www.nypost.com/p/news/business/with_frantic_sales_talks_failing_tiO1ERdMp7SN1PnC7UC54N#ixzz1cNsAFHo9
(Excerpt) Read more at nypost.com ...
MF Global was among firms that were forced to take write-offs as part of last week’s deal to resolve the debt crisis in Europe.
The firm filed for Chapter 11 protection in U.S. Bankruptcy Court in the Southern District of New York.
The largest unsecured creditors owed money by MF Global are JPMorgan Chase (JPM, Fortune 500), with more than $1.2 billion in corporate bonds, and Deutsche Bank (DB), with $1 billion in bonds, according to court documents.
JPMorgan’s stock fell more than 3% and Deutsche Bank plunged nearly 10%.
http://money.cnn.com/2011/10/31/news/companies/mf_global/
That figures. He’s not only a MF but also a SOB.
Why didn't this happen to that MF Corzine years ago?
Why didn’t he just go to Geithner who would have made MF Global whole with taxpayer’s money? Isn’t that the well-worn path? </sarc>
DEMOCRAT ========))) Jon Corzine (((======== DEMOCRAT
Geithner is running out of other people’s money.
“Geithner is running out of other people’s money.”
Exactly!
Financial exchanges around the world Monday moved into lockdown mode on embattled broker-dealer MF Global Holdings.
Broker clients that clear customer trades through MF Global were scrambling Monday morning to move business elsewhere and some staff of the New York-based firm were being barred from trading on exchange floors.
“It’s a mess,” said one floor broker in Chicago, speaking on condition of anonymity due to the sensitivity of the situation.
MF Global filed for bankruptcy protection in New York mid-morning Monday.
U.S. futures exchanges run by IntercontinentalExchange Inc. limited brokers clearing trades through MF Global to liquidating positions only, as opposed to opening new positions, according to an announcement.
In Chicago, CME Group barred some staff of MF Global from accessing the futures exchange group’s physical trading floors, according to a spokeswoman. Floor personnel for MF Global weren’t allowed on the floor, floor traders added.
Some MF Global employees showing up for work Monday found their key cards deactivated by the exchange. Employees that showed up before 7 a.m. CDT gained access, but those attempting access after that were denied entrance, sources said. The employees that made it on the floor were attempting to conduct business as usual but were escorted off the trading floor security.
He ran the company the same way he ran New Jersey.
There is almost no margin for error when dealing in Bonds. I suspect whomever buys this out of BK will then sue everyone they can - especially the people who sold them CDS.
Also this is really quite bad for Europe. By forcing people to take a 50% haircut on Greek debt, who will invest in any European bond in the future? Won’t people now scramble to unwind Italian, Spanish, Portuguese, Irish debt? For Europe to merely dictate that the holders of Greek debt must “voluntarily” take a 50% haircut is sinister. They wiped out Corzine’s company among others to protect in part their own institutions that sold CDS. It’s really sick, actually, and the long term impact could be disastrous for Europe and the Euro.
It takes real talent to almost bankrupt a state and then actually take down a publicly traded company after being fired from the first job.
-——the long term impact could be disastrous——
Actually the short term is a disaster for the MF’s at Global.
However your post raises the question....... what else could they do? They screwed around for a long time developing the solution that now appears to be a problem.
To me is falls under the heading “do something, even if it’s wrong”
They could have printed Euros. That is what any other country/currency would have done. But it is against the ECB’s rules, because the nothern countries are afraid of inflation but specifically because they were afraid of exactly this happening.
Yeah what else could they do? I don’t know. Printing Euros would have been a better solution, imho, even if they had to make a special dispensation. If they wont defend their own who will?
Corzine, from state killer to company killer
He should have kept his job as a politician. At least then you can lose major amounts of money and still keep your job.
Christie attains absolution for cleaning up after this Dem loser.
True, but it won't work, because those institutions will be done in as collateral damage anyway. If CDS doesn't pay, then no one will buy CDS. And it makes matters worse that MF Global went bankrupt, as they were one of the "insurance companies" selling CDS. The CDS is only as good as the party on the other end of the deal, and one of them now failed. The others don't look significantly better for the long haul.
The first time I heard of MF Global was back in 2008-09, when a "rogue trader" made a "data input error" and traded far beyond what he should have been allowed to on trades, and cost the company billions when they went bad on them. This always sounded highly suspicious, as well run companies don't have systems where people can allocate billions without traceability, range checks, validation, manager approvals, etc. I suspect that this organization has some criminal activity to hide, and hopefully it will now come out, and people will go to jail.
And hats off to the Tea Party, and even some credit to Occupy Wall Street. In 2008 this company would have been bailed out, but the political climate has changed so much it was never a serious consideration this time.
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