Wednesday, December 7, 2011

MF Global debacle

MF Global is in bankruptcy, and the trustees are still looking for more than $1 billion they have so far been unable to find.

Farmers hope it's not money they invested in hedging strategies.

MF Global's hedging services were popular among farmers in the United States, but they've been waiting for more than a month to hear whether their money has been lost.

Some have recovered about 20 per cent, but don't know the fate of the rest of their money.

One intermediary service for farmers has about $40 million placed as hedges with MF Global.

In theory, these hedging investments ought to be safe and secure, but it seems possible that MF Global scammed their money. The company's executives are being grilled now by Senators in the Agriculture Committee.

It seems that regulation in the U.S. was lacking for more than just banks and Wall Street firms.