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US citizens won't be able to have forex accounts overseas

  • #81
  • Aug 26, 2010 12:02am Aug 26, 2010 12:02am
Quoting Forexia
If you think that's unconsitutional, the really unconstitutional one is the proposal to cap margin from 100:1 to 10:1 for Retail Forex. That's outrageous. You can reall all of the discussions about it in the previous thread by the same name in the "Brokers Discussion" forum.

You should see the comments received by CFTC from traders all over the world opposing this. I just visited their website. The stupid SOB's didn't even publish my comment that I sent to them during the public comment period. I wonder how many they omitted. They supposedly...
mine was buried on page 16 of March 11 CL1027

had to search but found it.

http://www.cftc.gov/LawRegulation/Pu...ts/10-001.html

did you dig enough? they seem to have posted even the ones with foul language hehe
BarrySDCA Commercial Network Services
  • #82
  • Aug 26, 2010 12:05am Aug 26, 2010 12:05am
2 threads on the same topic
  • #83
  • Aug 26, 2010 12:12am Aug 26, 2010 12:12am
Quoting Trader KGB
Somewhere? Why don't you directly quote it, because I'm calling your bluff on this.

The US gov't cannot restrict its citizens from wiring money to a foreign institution with the intent to do business, there be an uproar if they even tried. Sure they can force the foreign brokers to register here if they want to do business, but not the other way around (force citizens not to do business with them).
That's fine, if they can't forbid US citizens from doing business with firms overseas. I will take your word for you it.

But what started this thread in the first place was a US trader being refused to be signed up as a client by a foreign broker for the reason that the foreign broker has not registered in the US. And the foreign broker cited the Dodd-Frank Wall Street Reform and Consumer Protection Bill as the basis for their action.
Make your losses in demo. Earn your profits live.
  • #84
  • Aug 26, 2010 12:14am Aug 26, 2010 12:14am
Quoting fxoxford
2 threads on the same topic
The new thread is a continuation of discussion on this thread. Pipmutt had to start that new one just to continue the discussion because for some reason, he couldn't quote or post in this thread anymore.
Make your losses in demo. Earn your profits live.
  • #85
  • Aug 26, 2010 12:30am Aug 26, 2010 12:30am
Quoting Forexia
The new thread is a continuation of discussion on this thread. Pipmutt had to start that new one just to continue the discussion because for some reason, he couldn't quote or post in this thread anymore.
good
  • #86
  • Aug 26, 2010 1:15am Aug 26, 2010 1:15am
Quoting Forexia
But what started this thread in the first place was a US trader being refused to be signed up as a client by a foreign broker for the reason that the foreign broker has not registered in the US. And the foreign broker cited the Dodd-Frank Wall Street Reform and Consumer Protection Bill as the basis for their action.
Maybe you should reread the first post. No where does it state that he couldnt open an account. According to the rep the offices arent even open yet so how can they take clients with no back office support?

The rep never states that he absolutely could not open an account. In fact, the rep seemed pretty clueless about it, which does not automatically translate into a No.

Quote
later: so your not sure if you are able to accepct u.s. resident

Client Services 20: correct

later: wow, thats does us no good, most u.s. brokers that have move there already accepect u.s. residents, so why can't you guys

Client Services 20: I just don't want to promise anything

...

Quote
Client Services 20: So we'll see about us clients
  • #87
  • Aug 26, 2010 2:45am Aug 26, 2010 2:45am
Quoting Trader KGB

The US gov't cannot restrict its citizens from wiring money to a foreign institution with the intent to do business, there would be an uproar if they even tried. Sure they can force the foreign brokers to register here if they want to do business, but not the other way around (force citizens not to do business with them).
Where would they wire money to if foreign brokers weren't registered, a broker in some dodgy unregulated tax haven somewhere? No thank you!

And if they are registered what would be the point of using a foreign broker anyway, it looks like the relevant rules will still apply to foreign brokers as they do to US brokers, there would be no benefit in using a foreign broker as the same rules would apply!

If someone wants to avoid these new regulations it seems the only way to do it is to use a broker outside CFTC jurisdiction, and doing that would have a whole new set of problems.

I think you 100:1 nedgers are pretty much screwed by the sound of it, do you think maybe it's time to learn how to trade?
  • #88
  • Aug 26, 2010 2:51am Aug 26, 2010 2:51am
Quoting Forexia

If you think that's unconsitutional, the really unconstitutional one is the proposal to cap margin from 100:1 to 10:1 for Retail Forex. That's outrageous.
I'm intrigued to know how you protesters use your 100:1 leverage, could you give a practical example of why you need 100:1 as opposed to say 10:1 or 5:1 and how you use such high leverage? I think you'll find that what you actually use in practical terms is probably more like 3 or 4:1, unless you're trading multiple pairs and having massive exposure and associated risk.

Please explain one of your average 100:1 trades, maybe I'm missing something!
  • #89
  • Aug 26, 2010 7:50am Aug 26, 2010 7:50am
Quoting Trader KGB
I didn't see this specific clause in the bill, and it would be nearly impossible to legally enforce.

I posted a link in the other thread, from a security laywer talking about the issue. It will come down to how ctfc/sec will interpret the dodd/frank-act, and that is not clear yet.

The enforcement works, because not the clients are threatened, but the firms who solicit americans outside the country will run into problems with their american branches. This is why IG Markets, RBS Marketindex, CMC or any other semi-serious CFD firm wont accept american customers. For example, FXCM will not open cfd accounts for americans, if that regulation comes to pass, this will be extended to fx too. Sure there will be firms which hide in some remote offshore island with no interests in the US, but the question is if it would be wise to send money there at all.
  • #90
  • Aug 26, 2010 10:22am Aug 26, 2010 10:22am
Quoting pipmutt
Where would they wire money to if foreign brokers weren't registered, a broker in some dodgy unregulated tax haven somewhere? No thank you!

And if they are registered what would be the point of using a foreign broker anyway, it looks like the relevant rules will still apply to foreign brokers as they do to US brokers, there would be no benefit in using a foreign broker as the same rules would apply!

If someone wants to avoid these new regulations it seems the only way to do it is to use a broker outside CFTC jurisdiction, and...
LOL I thought you gave up! You can't stay away from us, can you?

Welcome back!
Make your losses in demo. Earn your profits live.
  • #91
  • Edited 2:44pm Aug 26, 2010 10:42am | Edited 2:44pm
Quoting pipmutt
I'm intrigued to know how you protesters use your 100:1 leverage, could you give a practical example of why you need 100:1 as opposed to say 10:1 or 5:1 and how you use such high leverage? I think you'll find that what you actually use in practical terms is probably more like 3 or 4:1, unless you're trading multiple pairs and having massive exposure and associated risk.

Please explain one of your average 100:1 trades, maybe I'm missing something!
Ok pip, that's NOT the point! How much leverage to use when trading a particular investment instrument is not anybody's business but the traders'. It's up to the traders to decide how much and how and when to use leverage in their trading business. It's their trading business, their trading venture, CFTC or NFA or anybody have no business in there!! Whether traders need to or actually use high leverages is IRRELEVANT here!

And traders really shouldn't have to open up their private trading system or trade journals to actually show somebody in order to justify or prove their usage of high leverage in their trading.

BUT if you REALLY want practical examples, you can go to the CFTC website and go to the "Comment Archives" and read through the emails that have been sent to CFTC regarding this proposal. These emails are from actual traders and they do have successful trading business utilizing high leverage. And many of them do explain in quite detail how their trading works and how their trading will be impacted by this margin cap change.

This argument should be considered resolved, and really shouldn't be brought up again! If it's brought up again, I am going to just copy and paste this resolution here.
Make your losses in demo. Earn your profits live.
  • #92
  • Aug 26, 2010 10:47am Aug 26, 2010 10:47am
Quoting pipmutt
I think you 100:1 nedgers are pretty much screwed by the sound of it, do you think maybe it's time to learn how to trade?
Just because you use low leverage doesn't mean people who do use high leverage don't know how to trade.
Make your losses in demo. Earn your profits live.
  • #93
  • Aug 26, 2010 10:53am Aug 26, 2010 10:53am
Quoting BarrySDCA
mine was buried on page 16 of March 11 CL1027

had to search but found it.

http://www.cftc.gov/LawRegulation/Pu...ts/10-001.html

did you dig enough? they seem to have posted even the ones with foul language hehe
LOL They are supposed to. They said on their website that they will post all comments as how they are received along with all personal info. on the site. I dug through comment files until the ones several days after the date of my email and I still couldn't find mine. I will dig further to see.

It's amazing the response. There are non-English speaking traders who sent in comments in their own native language. I hope CFTC has translators.
Make your losses in demo. Earn your profits live.
  • #94
  • Aug 26, 2010 11:14am Aug 26, 2010 11:14am
Quoting traderjai_inhi
Maybe you should reread the first post. No where does it state that he couldnt open an account. According to the rep the offices arent even open yet so how can they take clients with no back office support?

The rep never states that he absolutely could not open an account. In fact, the rep seemed pretty clueless about it, which does not automatically translate into a No. ...
Quoting fxoxford
You are now chatting with 'accounts2'

accounts2: Hello, my name is Dustin. How can I help you?

later: hi, i will like to know when will the U.K. office and the australia office opens

Please wait while I transfer the chat to the best suited site operator.

You are now chatting with 'Client Services 20'

Client Services 20: Hello, this is Jordi. How may I help you?

later: hi, i will like to know when will the U.K. office and the australia office opens

Client Services 20: We don't have a date yet
Quoting fxoxford
Client Services 20: but australia should be next month

later: will you guys be offering higher leverage

Client Services 20: most likely yes

Client Services 20: at least 200

Client Services 20: probably 400

later: cool

...

later: i see, so i can look forward to the australia office opening next month? also will you that office be accepting u.s. residents

Client Services 20: I wish I had more details to give you
Quoting fxoxford
Client Services 20: I'm in the dark about most things also, but I'm told september

later: so your not sure if you are able to accepct u.s. resident

Client Services 20: correct

...

Client Services 20: There's a new law coming, or already happened, might make it illegal for us citizens to have accounts overseas. The other brokers would lose all their us clients also if they are using over seas accounts/companies

Client Services 20: barnie frank and some other senator working on it

...

Client Services 20: it's part of this
Quoting fxoxford
Client Services 20: http://en.wikipedia.org/wiki/Dodd%E2...Protection_Act

Client Services 20: If you want more info
This is what I have seen that started this thread. You should read Shrike's post later. He has more information on this.
Make your losses in demo. Earn your profits live.
  • #95
  • Aug 26, 2010 12:24pm Aug 26, 2010 12:24pm
Quoting Forexia
LOL I thought you gave up! You can't stay away from us, can you?

Welcome back!
Me, stay away? Nah, I love you guys!


Quoting Forexia

And traders really shouldn't have to open up their private trading system or trade journals to actually show somebody in order to justify or prove their usage of high leverage in their trading.
Oh I wasn't asking anyone to 'open up their private trading system or trade journals', I just wondered how you use 100:1, especially when it comes to risk management, all I was interested in was a simple hypothetical example.

I take it from your reply that you don't actually use that kind of leverage, I doubt many traders do, so the whole argument about any proposed reduction in leverage is a bit of a moot point really!

Hey, the manufacturers of my car say it's capable of 150 MPH. I'm a good driver, I can handle that kind of speed. The government says I'm only allowed to do 70 MPH. I WANT TO BE ABLE TO DO 150 MPH IF I WANT TO, IT SHOULD BE MY CHOICE, WHO ARE THEY TO TELL ME HOW TO DRIVE etc etc etc!! (I don't actually want to drive at 150 but that's irrelevant, right?)

I'm sure you get my drift.....
  • #96
  • Aug 26, 2010 12:35pm Aug 26, 2010 12:35pm
Quoting pipmutt
Where would they wire money to if foreign brokers weren't registered, a broker in some dodgy unregulated tax haven somewhere? No thank you!
Unregistered in the US is fine so long as they're registered elsewhere (FSA, FINMA, etc).

I agree that sending money to a completely unregistered off-shore broker is insane, but there are fools born every minute, and dozens upon dozens of such brokers continue to find unsuspecting clients.

Quote
I think you 100:1 nedgers are pretty much screwed by the sound of it, do you think maybe it's time to learn how to trade?
That's not the point I was arguing. And if anyone wants sky-high leverage in the 'ol USA, they need look no further than the $500 margin futures brokers..
  • #97
  • Aug 26, 2010 12:41pm Aug 26, 2010 12:41pm
Quoting shrike
FXCM will not open cfd accounts for americans, if that regulation comes to pass, this will be extended to fx too. Sure there will be firms which hide in some remote offshore island with no interests in the US, but the question is if it would be wise to send money there at all.
Interesting, good points.

Call me paranoid, but I've considered opening up a couple UK accounts as placeholders should the CFTC slam the door shut (under the assumption that pre-existing UK accounts would be grandfathered-in, but even that may be a stretch). I can operate within the confines of futures and 10:1 spot, but I like having my options open.
  • #98
  • Aug 26, 2010 1:14pm Aug 26, 2010 1:14pm
The reason behind high leverage is SIMPLE. Instead of maintaining a larger cash reserve in your trading account you can allocate it elsewhere. How many brokers have you seen go out of business and not pay back clients a nickel? Lots

Quoting pipmutt
Me, stay away? Nah, I love you guys!




Oh I wasn't asking anyone to 'open up their private trading system or trade journals', I just wondered how you use 100:1, especially when it comes to risk management, all I was interested in was a simple hypothetical example.

I take it from your reply that you don't actually use that kind of leverage, I doubt many traders do, so the whole argument about any proposed reduction in leverage is a bit of a moot point really!

Hey, the manufacturers of my car say it's capable of 150 MPH. I'm a...
Annoying Precision
  • #99
  • Aug 26, 2010 1:39pm Aug 26, 2010 1:39pm
Quoting erikte279
The reason behind high leverage is SIMPLE. Instead of maintaining a larger cash reserve in your trading account you can allocate it elsewhere. How many brokers have you seen go out of business and not pay back clients a nickel? Lots
I forgot to mention it again as I mentioned it in a previous post on the other thread, sorry about that, I meant excluding protection of funds reasons.

Going by the posts it doesn't seem safety of funds is the motive for wanting 100:1 though.
  • #100
  • Aug 26, 2010 1:54pm Aug 26, 2010 1:54pm
Quoting Trader KGB
Interesting, good points.

Call me paranoid, but I've considered opening up a couple UK accounts as placeholders should the CFTC slam the door shut (under the assumption that pre-existing UK accounts would be grandfathered-in, but even that may be a stretch). I can operate within the confines of futures and 10:1 spot, but I like having my options open.
Another thing to consider would be that the new regs only affect retail fx. It would be intersting what the term retail exactly means, i guess just private individuals that dont meet ECP criteria. Maybe using a LLC (maybe domiciled in UK, since its cheap to found and maintain there) would be enough to escape the regulation?
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