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Could 10:1 be the new leverage in US Forex?

  • #521
  • Feb 7, 2010 9:38pm Feb 7, 2010 9:38pm
Quoting Scarlett
......Alright, enough bitching...what can we do?
Here is what we can do, this is the complete Zelener case showing who the attorneys were. The attorneys that put the Mountain Police on their knees were "Lloyd A. Kadish, Kadish & Associates, Scott E. Early (argued), Foley & Lardner, Chicago, IL, for Defendants-Appellees"
http://ftp.resource.org/courts.gov/c...1.03-4245.html
These were the appellate attorneys though, it's very possible but not sure but if one of these was also the trial attorney. It's a start.

PS. Zelener won the trial...the Federales appealed, and they lost the appeal.
  • #522
  • Feb 8, 2010 1:35am Feb 8, 2010 1:35am
Quoting wwwin
Here is what we can do, this is the complete Zelener case showing who the attorneys were.
Think you guys may find that one cannot bring an action where there is presently no cause. i.e. the CFTC proposals are just that, proposals.

If or when they become binding in law (and that is still an if), that would be the appropriate time to seek legal advice (if in fact anyone can be bothered by then, assuming most traders will have Plan B (off-shore accounts) already well in hand by then).

Pirrong noted in his piece, last sentence..

"But they are waiting on Congress for authority to act in the OTC market. Slow walking the proposal gives Congress time to act, and may indeed goad it into action."

Bottom line - it's a proposal and that's all it is. Nevertheless, it has one particularly nasty element (10:1) and the overtones (of herding OTC business into the exchanges) are clear. If as a trader, that doesn't suit you, then this would be a good time to put a back-up plan together (for your own sake.) Leave the legal dog fight for the industry stakeholders to pursue at the appropriate time (if it gets to that, which it may not.)
  • #523
  • Feb 8, 2010 2:45am Feb 8, 2010 2:45am
Just to further expand the cerebral matter (and be very entertained at the same time, funny it is), more from Pirrong (on Gensler's grand plans for the OTC market)

http://seekingalpha.com/article/1824...the-otc-market
  • #524
  • Edited 5:34am Feb 8, 2010 5:13am | Edited 5:34am
Quoting Jade Gate
Think you guys may find that one cannot bring an action where there is presently no cause. i.e. the CFTC proposals are just that, proposals.

If or when they become binding in law (and that is still an if), that would be the appropriate time to seek legal advice (if in fact anyone can be bothered by then, assuming most traders will have Plan B (off-shore accounts) already well in hand by then).

Pirrong noted in his piece, last sentence..

"But they are waiting on Congress for authority to act in the OTC market. Slow walking the proposal......
No. An action can be brought now for declaratory judgment to determine the scope of the farm bill, the patsies don't have to wait to be out of business to determine the scope....you don't have to wait for the Federales Mountain Police to pass the "new regulatory scheme for retail forex" as they call it....it is the "new regulatory schem for retail forex" that is the big problem, even bigger than the 10 to 1, as that is what will close the loophole...
read here on declaratory judgment
http://en.wikipedia.org/wiki/Declaratory_judgment

I agree is it the FXDC that should do it but they ain't doing sheeeet!

PS. Thanks for the other Pirrong article...more evidence that the leader of the Mountain Police has a warped mind...this article is funny...

"And how does Gensler explain the fact that end-users have voted with their checkbooks to trade OTC even when exchange traded alternatives are available? Does he know their businesses better than they do?
To paraphrase H. L. Mencken, Gensler and the rest of the DC crowd seem to be financial Puritans, haunted by the fear that somewhere, in the darkest recesses of the OTC market, consenting adults may be happy, making mutually beneficial deals." http://cdn.forexfactory.com/images/s..._the_floor.gif
.....
And Gary, give the apple thing a rest:

“We would not tolerate it if other markets operated similarly to over-the-counter derivatives, where dealers are the only ones with much of the relevant information,” profiting from spreads between bids and offers that are wider than they would be in an open market, Gensler said.


[i]He compared the situation to “buying an apple from the supermarket when the price of the apple is kept private.”

LOL, can somebody inform the Mountain Police that the spread is smaller in FX spot than in FX Futures...http://cdn.forexfactory.com/images/s..._the_floor.gifhttp://cdn.forexfactory.com/images/s..._the_floor.gif

  • #525
  • Feb 8, 2010 5:37am Feb 8, 2010 5:37am
Quoting wwwin
No. An action can be brought now for declaratory judgment to determine the scope of the farm bill, the patsies don't have to wait to be out of business to determine the scope....you don't have to wait for the Federales Mountain Police to pass the "new regulatory scheme for retail forex" as they call it....it is the "new regulatory schem for retail forex" that is the big problem, even bigger than the 10 to 1, as that is what will close the loophole...
read here on declaratory judgment
http://en.wikipedia.org/wiki/Declaratory_judgment...
Lloyd Kadish & Assoc Ltd

(312) 559-9181


Any volunteers to call?
Scarlett
  • #526
  • Feb 8, 2010 5:39am Feb 8, 2010 5:39am
Quoting Scarlett
Lloyd Kadish & Assoc Ltd

(312) 559-9181


Any volunteers to call?
Pobably better to email as calling probably will not get you through beyond the receptionist....
  • #527
  • Feb 8, 2010 5:54am Feb 8, 2010 5:54am
Quoting wwwin
Pobably better to email as calling probably will not get you through beyond the receptionist....
I don't think I can articulate the questions properly.
I'm not sure I understand it well enough...

Write me a script or write an email and copy me here and I'll follow up by phone.

Does that make sense?
Scarlett
  • #528
  • Edited 6:13am Feb 8, 2010 6:11am | Edited 6:13am
Quoting wwwin
Here is what we can do, this is the complete Zelener case showing who the attorneys were. The attorneys that put the Mountain Police on their knees were "Lloyd A. Kadish, Kadish & Associates, Scott E. Early (argued), Foley & Lardner, Chicago, IL, for Defendants-Appellees"
http://ftp.resource.org/courts.gov/c...1.03-4245.html
These were the appellate attorneys though, it's very possible but not sure but if one of these was also the trial attorney. It's a start.

PS. Zelener won the trial...the Federales appealed,...
Get back to me on this. Who do we want to talk/email to?
http://www.foley.com/people/bio.aspx?employeeid=16614 ??
Scarlett
  • #529
  • Feb 8, 2010 8:55am Feb 8, 2010 8:55am
Quoting Scarlett
I don't think I can articulate the questions properly.
I'm not sure I understand it well enough...

Write me a script or write an email and copy me here and I'll follow up by phone.

Does that make sense?
I would start by telling them that they are being contacted because they were counsel in the CFTC vs Zelener case, in which the court found that the CFTC did not have jurisdiction over spot transactions...But now because of some language in the Farm Bill, the CFTC is claiming jurisdiction again over all spot retail trading. I would ask if they feel the language in the Farm Bill is clear on this issue, or can the CFTC be challenged in Court again on this issue, as they are proposing a rule that would close the loophole that the Zelener case created...or something to that effect. I will email tonite with more time, but you can do it too.
  • #530
  • Edited 9:44am Feb 8, 2010 9:01am | Edited 9:44am
Quoting Scarlett
Get back to me on this. Who do we want to talk/email to?
http://www.foley.com/people/bio.aspx?employeeid=16614 ??
Yes definitely that one, I think Early was the lead trial counsel and the one that argued the Zelener appeal....he even posts the case below in his profile in the link above....but we should email all the attorneys involved representing the defendants in the Zelener case, I think 2 firms were involved and see if they respond. Can you find out email of the other firm?
  • #531
  • Feb 8, 2010 9:16am Feb 8, 2010 9:16am
Quoting Scarlett
Get back to me on this. Who do we want to talk/email to?
http://www.foley.com/people/bio.aspx?employeeid=16614 ??
OK, I was going to do it tonite, but did it now....I already sent the following email to Scott Earley @ [email protected].

------------------------------------------------------
Good morning Mr. Early:

I am contacting you because you were counsel to the Defendant/Appellee in the CFTC vs Zelener case, in which the court found that the CFTC did not have jurisdiction over spot forex transactions...But now because of some language in the Farm Bill, the CFTC is claiming jurisdiction over all spot retail trading. Do you feel that the language in the Farm Bill is clear enough on this issue, or do you feel that the CFTC can be challenged in Court again on this issue, as they are proposing a rule that would close the loophole that the Zelener case created.

------------------------------------------------------
  • #532
  • Feb 8, 2010 9:35am Feb 8, 2010 9:35am
Quoting wwwin
OK, I was going to do it tonite, but did it now....I already sent the following email to Scott Earley @ [email protected].

------------------------------------------------------
Good morning Mr. Early:

I am contacting you because you were counsel to the Defendant/Appellee in the CFTC vs Zelener case, in which the court found that the CFTC did not have jurisdiction over spot forex transactions...But now because of some language in the Farm Bill, the CFTC is claiming jurisdiction over all spot retail trading....
I am trying to find out who the original attorneys were...still looking later on in the day.
Scarlett
  • #533
  • Feb 8, 2010 9:43am Feb 8, 2010 9:43am
Quoting Scarlett
I am trying to find out who the original attorneys were...still looking later on in the day.
It looks like Scott Early was the main guy, because in his firm profile it says he was "lead trial counsel", and in the opinion it says "argued". So he appears to be the main one as he was the lead trial counsel and also orally argued the appeal.

I think now we only need the email of Lloyd Kadish.
  • #534
  • Feb 8, 2010 12:10pm Feb 8, 2010 12:10pm
I would help you guys contact attorneys but I don't have my shit together
Hindsight is 20/20
  • #535
  • Feb 8, 2010 12:27pm Feb 8, 2010 12:27pm
Quoting cosgrove
I would help you guys contact attorneys but I don't have my shit together
Billable time - billable time, baby. And my belt matches my briefcase.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #536
  • Feb 8, 2010 2:40pm Feb 8, 2010 2:40pm
Quoting wwwin
Here is what we can do, this is the complete Zelener case showing who the attorneys were. The attorneys that put the Mountain Police on their knees were "Lloyd A. Kadish, Kadish & Associates, Scott E. Early (argued), Foley & Lardner, Chicago, IL, for Defendants-Appellees"
http://ftp.resource.org/courts.gov/c...1.03-4245.html
These were the appellate attorneys though, it's very possible but not sure but if one of these was also the trial attorney. It's a start.

PS. Zelener won the trial...the Federales appealed,...

Excellent piece of appellant case law research, nice work wwwin.

p.s. the question now is how has the legislation been framed to give jurisdiction to the CFTC... something for the legal eagles to wrap their brains around.
  • #537
  • Feb 8, 2010 3:43pm Feb 8, 2010 3:43pm
Government is always out to accumulate power. The only way to hold it accountable/ keep it in check, is to hold our representatives feet to the fire and let them know we only need protection from criminals, not ourselves. First financial regulation(restriction?), then what else? What we can eat, how fast we can drive, etc.. Contact your rep and let them know what happened in Massachusetts with the "Kennedy seat", can happen to them. Sometimes pushing back, rather than running overseas, is the only answer. Freedom is something we can never run away from. We must protect it, because once we lose it, it is a lot harder to get it back.
  • #538
  • Edited 8:37pm Feb 8, 2010 7:28pm | Edited 8:37pm
"The CFTC also has partnered with the U.K. Financial Services Authority to increase supervision of energy markets through greater information sharing and surveillance."
http://www.reuters.com/article/idUSTRE60D4QT20100114


"Crigger: At what point do investors just throw up their hands and say, "Forget this; I'm going to take my money overseas."?
Pirrong: I think that's very likely, and I think it's one reason why you see Gensler and others talking about how we need a lot of international cooperation, that we need a global approach. I don't know if they're going to get very far about that-particularly in the U.K. The U.K. has expressed very little enthusiasm for these things than has been the case in the United States. To the extent that the U.S. proceeds on this, this would be a boon for London and a disadvantage to the U.S. markets."
http://www.hardassetsnow.com/feature...2.html?start=1

Crigger: So how do you think we'll see commodities ETFs evolve in response?
Pirrong: That's the other thing about which regulators are sometimes a little slow on the uptake. By creating more rules, they're essentially just creating an arms race to see who can structure new products, or who can go into certain markets, and basically run around the rules. The creativity of our financial engineers is pretty great. You give them a certain set of rules, and they can find a way to engineer their products that stays within those rules but also undermines their purpose.
I think the funds will be smart and keep their powder dry; wait and see what the government does about implementing new laws or CFTC rules before making any decisions. But I'm highly confident that once those rules are in place, they'll impose such restrictions on the way that ETFs currently operate, that it will be impossible for them to continue their current M.O.-and that will give those funds incentive to devise new M.O.s.

Below image is part of Gensler's letter to congress...full letter is here
http://www.scribd.com/doc/18972469/0...-Senate-Letter
Attached Image(s) (click to enlarge)
Click to Enlarge Name: gensler_let.jpg Size: 123 KB
Click to Enlarge Name: gensler2.jpg Size: 74 KB
  • #539
  • Feb 8, 2010 8:47pm Feb 8, 2010 8:47pm
I knew it, little hitler is using retail forex to get to other OTC markets....and he wants to require foreign trade boards to register with the CFTC if they allow U.S residents to open accounts in their country.

This guy is relentless.
  • #540
  • Feb 8, 2010 9:18pm Feb 8, 2010 9:18pm
And I thought Nicholas Sarkozy was the greatest enemy of Forex...
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