Watching Jon Corzine testify before the House agriculture committee, I was reminded of a professional prize-fighter bobbing and weaving to escape a brutal pounding. He was scuffed up pretty well as his evasions were unbelievable and insulting to intelligence, and investors took a hit because they felt he was a savior. As it turns out, the former governor of New Jersey and a man Joe Biden praised for his wisdom on finance, was like a kid trying to explain what happened to his missing homework.
I remain deeply concerned about the impact that the un-reconciled and frozen funds have had on MF Global's customers and others. As the chief executive officer of MF Global, I ultimately had overall responsibility for the firm. I did not, however, generally involve myself in the mechanics of the clearing and settlement of trades, or in the movement of cash and collateral. Nor was I an expert on the complicated rules and regulations governing the various different operating businesses that comprised MF Global. I had little expertise or experience in those operational aspects of the business.
I was stunned when I was told on Sunday, October 30, 2011, that MF Global could not account for many hundreds of millions of dollars of client money.
Of course the biggest bombshell is the fact Jon Corzine, CEO of MF Global, has no idea where $1.2 billion of the company's client funds are but is sure they will turn up. I guess they are checking sofa cushions and petty cash drawers. In the first round of questioning, a congressman had trouble trying to figure out a title for Corzine and as he grappled with that you could hear a faint murmur in the microphone from Corzine himself: "lot of people have bad names for me". Well, considering his rope-a-dope act, I think we should find a new name/title for the man that has made a mockery of governing in public and private arenas.
Take the poll (see box), and let me know what would be a good nickname for Jon Corzine like the monikers that boxers adopt for themselves.
News is trickling out, but it looks like the euro will be saved although it may be a different euro and a different European Union. David Cameron threw a small monkey wrench into things this morning when he firmly stated the UK wouldn't give up its sovereign rights because a bunch of countries in the Mediterranean squandered their wealth. Moreover, the tax on financial transactions (Tobin Tax) would have a devastating impact on the nation's banking industry.
Once again, the market is like Pavlov's dog, salivating at the idea of a resolution for the European debt crisis, but an earnings warning from DuPont put the brakes on upside equity momentum. I like the action, but we know the market could finish this session down 200 as easily as up 200, so I want to let things shake out this morning.