Hi Sandalphon ... Refco is yet another example of the tendency for the derivatives industry to hide 'problems' ... ala Enron which blew up US$60billion.
Even our own NAB's rogue trader scandal ($380million) is an example of inadequate transparancy close to home.
"The BIS had already reported that the outstanding amount of exchange-traded derivatives (i.e. futures and options) reached $46.6 trillion at year’s end. Together with the amount of OTC derivatives, this put the total amount of derivatives outstanding in global markets at $295 trillion. By point of comparison, the U.S. gross domestic product was $12 trillion at the end of 2004, and the amount of outstanding U.S. Treasury securities totaled $4.17 trillion."
http://www.financialpolicy.org/fpfspb25.htm
Cheers ... tight stops.
This is only my view ... read the red stuff.
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