THIS IS JUST SOOOOOOOO WRONG!!!!!!!!!!!!!
Which is what is fueling the conspiracies:
* The regulators have gone along with everything they've done.
* The media has minimized coverage regarding what happened. It should have been front-page headline material.
* Nobody is commenting on the irregularities of the situation except for people on the margins of the whole system.
If I had to guess, the conspiracy was not to primarily to derail and thereby discourage long speculations in commodities including precious metals--though this outcome might very well have occurred to the schemers and have been a secondary benefit from their point of view. More likely, it was to set precedents regarding who has a place on a lifeboat, given that it is no longer possible to maintain the illusion that there are enough lifeboats for everyone.
They "kicked the can down the road" regarding the question of whether, how, and to what extent, clients of MF Global will be "indemnified" ("made whole", compensated) for their losses, and within what time frame. The continuing uncertainty should be making folks nervous.
Apparently JP Morgan was a recipient of some of the client funds:
http://www.cbsnews.com/8301-505123_162-57346154/jpmorgan-may-have-missing-mf-global-funds/Money was not the only thing re-allocated, so were physical commodities (further helping to fuel conspiracy theories):
http://finance.yahoo.com/news/the-silver-rush-at-mf-global-.htmlThe trustee overseeing the liquidation of the failed brokerage has proposed dumping all remaining customer assets—gold, silver, cash, options, futures and commodities—into a single pool that would pay customers only 72% of the value of their holdings. In other words, while traders already may have paid the full price for delivery of specific bars of gold or silver—and hold "warehouse receipts" to prove it—they'll have to forfeit 28% of the value.
That has investors fuming. "Warehouse receipts, like gold bars, are our property, 100%," contends John Roe, a partner in BTR Trading, a Chicago futures-trading firm. He personally lost several hundred thousand dollars in investments via MF Global; his clients lost even more. "We are a unique class, and instead, the trustee is doing a radical redistribution of property," he says.
Roe and others point out that, unlike other MF Global customers, who held paper assets, those with warehouse receipts have claims on assets that still exist and can be readily identified.
The tussle has been obscured by former CEO Jon Corzine's appearances on Capitol Hill. But it's a burning issue for the Commodity Customer Coalition, a group that says it represents some 8,000 investors—many of them hedge funds—with exposure to MF Global. "I've issued a declaration of war," says James Koutoulas, lead attorney for the group, and CEO of Typhon Capital Management.
At stake is an unspecified, but apparently large, volume of gold and silver bars slated for delivery to traders through accounts at MF Global, which filed for bankruptcy on Oct. 31. Adding insult to the injury: Of the 28% haircut, attorney and liquidation trustee James Giddens has frozen all asset classes, meaning that traders have sat helplessly as silver prices have dropped 31% since late August, and gold has fallen 16%. To boot, the traders are still being assessed fees for storage of the commodities.
