Recently by Simon Black: Can You See This Gorilla?
Denver based Barnhardt Capital Management is a futures brokerage firm that focuses on agriculture, round-the-clock broker access, and inexpensive commissions. At least, it used to be.
Barnhardt shuttered its operations yesterday after six-years in the business. The firms founder Ann Barnhardt posted the reasons online for the entire world to see:
I could no longer tell my clients that their monies and positions were safe in the futures and options markets, because they are not. And this goes not just for my clients, but for every futures and options account in the United States. The entire system has been utterly destroyed by the MF Global collapse.
Liaru2019s Poker (Nort... Best Price: $1.50 Buy New $6.50 (as of 03:10 UTC - Details)
Ms. Barnhardt further explains that markets are completely fractured that the rule of law in the United States no longer exists. She decries Jon Corzine of MF Global for having outright stolen customer funds, and various exchanges and government regulators for having frozen out customer accounts as a result.
Given that the entire industry is suicidally-leveraged and exposed to European sovereign junk debt, Barnhardt recommends that ALL customers withdraw from all of the markets as soon as possible so that they have the best chance of protecting themselves and their equity.
We couldnt agree more with this sentiment. Our Chief Investment Strategist Tim Staermose wrote just last week that cash is a great place to be right now and weve been arguing for months that markets are completely broken. The markets price discovery mechanism has given way to rumor and political innuendo.
A real economy cannot function under such circumstances. With Europe on the precipice and roughly $600 TRILLION in global derivative notional value lurking in the system, can a real collapse be that far off?