Bankrupt MF Global to Pay Out Bonuses – Sure, Why Not

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Kleptocrats, President Obama & Jon Corzine - slogan for the failed gubernatorial campaign was "Obama & Corzine, One Voice."

I reported on this story numerous times and included one story in this article that is from January 2nd of this year.

Not only did MF Global take money that did not belong to them, they lost $1.2 billion. Understandable, I lose money when I add up my checkbook too. What is 1.2 billion when we talk in trillions now.

To make matters worse, the regulators shut the customers out and continue to do so to this day but they did manage to pay off JP Morgan Chase.

Jon Corzine, former Governor of New Jersey, was the man who managed to destroy the company inside of two years with a little help from his “yes men.”

The best is yet to come. The very people who were in charge as the company went down the proverbial tubes are now going to receive bonuses. They won’t be as large as they are used to getting. [Well, that makes it all better.] I’d like to know why they are even still working there!!!

The reason for the bonuses is so they can oversee the liquidation they helped cause.

Apparently another 20 employees will receive bonuses.

I do think they’d be remiss to not give Corzine a huge bonus, after all, he was the most incompetent of the bunch – that’s worth something at MF Global!

Read here: WSJ

 

Original Story: 1/2/2012: The United States financial situation, which appears to be insoluble at the moment, could end up dwarfing the euro debt crisis.

It is hard to trust our financial system when we see the theft of millions of customer dollars as in the current MF Global scandal. The disappearing $1.2 billion is only part of the story.

Regulators in charge of investigating MF Global were supposed to safeguard clients money. Instead the regulators shut customers out of their segregated accounts, basically stole the money, and used it to pay off creditors like JP Morgan.

Segregated accounts are like safety deposit boxes that should not be touched under any circumstances.

The money never belonged to MF Global and it was not theirs to give but the regulators allowed this to happen.

What should have happened is the customers should have been given their money back, then creditors like JP Morgan should have been given the remaining assets. Instead customers were locked out of their own accounts for a week while the regulators allowed MF Global to pledge the assets to JP Morgan and other creditors.

Basically, they were able to legally change the order of who gets paid by treating it as if it were a bankruptcy of an equities firm instead of a commodities brokerage firm under subchapter IV of the Chapter 7 bankruptcy law.

The reason for this theft and cronyism is to keep the “too big to fail” financial institutions from collapsing.

Investors are losing faith in the system and some are tending to buy actual physical commodities instead of trusting paper transactions. Losing faith in the system creates a dangerous situation. Read here: Trusting the system

We hear a lot about the euro debt crisis, but it seems somewhat overblown when one considers our own situation. Several members of the EU still have better credit ratings than we do and our dollar is not faring well.

According to Forbes, under-capitalized European banks owe American banks trillions and we know they are in dire straits, requiring heavy infusions of money to prevent a run. If the EU goes down, we are too weak to survive it, and we might be facing our own run if investors lose faith in our system.

We don’t even know what and why things are happening. The global central planning hasn’t made our financial situation clearer, which should come as no surprise. Record numbers of US Treasuries were sold last year despite the fact that Treasuries are doing well. In the last month alone, foreigners sold a record $69 billion in U.S. paper. Zerohedge reports that it is unclear why this is happening – could be China selling our Treasuries, could be France…

I don’t see how the United States is better off than the EU. Maybe we are better off than Greece, but we are possibly not better off than Germany. I am convinced that we won’t do a thing about it until it becomes an emergency, and then it will be out of our hands, not what we as a free nation should let happen.

While Germany is doing relatively well, perhaps better than the United States, Andrea Merkel expects Germany to begin feeling the effects of the euro crisis in 2012.  The euro ended 2011 as the worst performing major currency. Worse still is the lack of economic growth on top of their high debt, deficits and austerity programs. There are no signs that the European economy will grow in 2012. Read more here: spiegel.de

How is the situation in Europe different from ours? Maybe we are not Greece, but we might be Italy.

We have a corrupt, crony way of dealing with our problems that won’t work. Theft of customer assets should not be the answer to keeping the big banks afloat. Capitalism isn’t the problem, but government-sponsored theft and cronyism is a problem.

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