MF reporting

I am generally a big fan of Frontline’s documentaries however I didn’t think that their story on the demise MF Global was particularly enlightening.  Perhaps I am already familiar with how the industry works and having followed the MF Global situation closely their story did not provide me with any new information.

I wonder if my enjoyment of Frontline is in part due to knowing very little about the topics of most of their stories.  If I knew more perhaps I would have the same reaction that I did to their MF Global story.  Or maybe it was just weak reporting on their part.

On the other hand Fortune Magazine has done a very good in depth piece detailing the last days of MF Global.

I know that I am not the first to notice the irony - but Jon Corzine seems to have forgotten the lessons of  Long Term Capital Management.  LTCM made huge bets on small convergence trades.  When they started losing money each of their counter-parties demanded increased collateral, which forced LTCM to liquidate large and somewhat illiquid positions, which led to further losses, which led to increased demands for collateral and so on.  Goldman CEO Jon Corzine strong-armed the other major investment banks to lend LTCM more money and not increase collateral calls so they could liquidate in an orderly fashion.  And now thirteen years later MF Global CEO Jon Corzine is undone by a similar liquidity crunch.  Whoever the Greek god of finance is (is it Mercury?) s/he must have an ironic sense of humor.