Good comment, denner. The world is awash in liquidity, levrage is crazy high and the cost to borrow is low enough to prop things up that should have been buried two ... if not ten ... years ago. It's like putting plastic flowers in a vase and pretending you can smell them. So much of what underpins the current "prosperity" is artificial.
apparently everyone is doing it. there is nowhere to hide, either you quit the business or you live by the sword with them. i don't know if you are aware but nowadays, in europe, the big cash cow companies are moving their deposits to the ECB because they don't trust any of the prime banking institutions anymore... so imagine where that puts the brokerage industry, as far as safety is concerned.
Braincell: I see the transfers in my statement virtually every night. Look at the Cash Report, Internal Transfers. Jack
Just checked both Rosenthal Collins and R J O O'brian. Both have the same provision for re-hypothecation. So it's a cluster fuck.
If I remember from his posts over the year's, DEF, is in charge of IB's Hong Kong or Far East operations. He defends IB, but he is a straight-shooter. If I'm not mis-interpreting what he said above, he is going to try to get better info to us on what hypothecation and re-hypothecation are. Hopefully, he'll be able to tell us what the various parts of IB do with regard to both, not just the brokerage corporation. As you are aware, lawyers get involved when words are being bandied about - it takes time to get it right. After reading a lot of stuff in this thread, I better understand the expression - the market is based on fear and greed. Lots of fear being expressed here. I think you guys are going overboard. IB has always been criticized as being overly conservative in virtually everything (except perhaps in the frequency of revising TWS and even that has slowed up remarkably). I'm guessing this is also true of hypothecation and re-hypothecation. Jack
I cannot find any reference to hypothecate or pledge in the account agreement for Cunningham Commodities/ Cunningham Futures Clearing. It is a very simple account agreement and does not have anything like that at all.
def posted on 6 forums here yesterday, but today he is very busy, he probably expects the conversation to die. My solution as others point out, if you have less then 500k, keep cash and equity with 1 firm, and futures at the second firm. If you have big account keeps it split with a few brokers. Just forget about the great convenience to have everything at the same place, its a convenience that comes with a high price.
The Crossland Agreement looks fine too.........this applies also to DeepDiscountFutures which clears through Crossland...
Ok so there's some choice. I guess you just have to take a overall view in terms of what a firm offers security wise.