Comment Text:
i0-001
COMMENT
CL-00178
From:
Sent:
To:
Subject:
Cary LaCost
Saturday, January 16, 2010 12:34 PM
secretary
A concemed American
To Whom It May Concern: I think lowering the leverage requirement for retail FOREX transactions will do
the exact opposite in regards to customer protection.
It wouldn't matter if you lowered or raised the leverage amount in terms of customer protection. The fact
of the matter is many uneducated people try their hand at FOREX and lose. Reducing leverage will not
change this outcome when FOREX brokers blanket the internet with advertising promising fast and easy
money with a little disclaimer at the bottom of heavy risks of loss.
The fact is the FOREX is a zero sum market. Lowering the leverage of retail FOREX in the U.S. would do
nothing but kill a legitimate business. Why would Americans keep trading in a climate that is laden with
laws against them? Why would foreigners open a FOREX trading account in the U.S. when the rules are
prohibitively against them compared to other jurisdictions around the globe? [Leverage works for you as
much as against you.]
We have already suffered massive restrictions in the U.S. already from the NFA with imposing No hedge
rules and FIFO. Most U.S. brokers have already opened brokerages outside the U.S. already due to the
enactment of these rules and to my knowledge all have plans to do so.
By enacting this legislation to restrict and limit traders further will only cause a mass exodus of FOREX
trading in the retail U.S. markets.
This will cause American traders to put their money in less than scrupulous brokers with less ethics than
what the U.S. permits via the NFA oversight.
So if American traders put their money in a foreign FOREX broker how can you say this will benefit the
trader? How will this protect the American trader? How will this benefit the U.S. based broker? How will
this encourage investment from foreign means in the retail U.S. FOREX market when rules around the
globe are more favorable to the trader?
Are we not satisfied until we move all high paying jobs overseas?
Before we were hit with all the erroneous NFA rules and regulations we were afforded up to 400:1
leverage. Guess what? people were blowing accounts even at that level. Changing the level of leverage
will do nothing to prevent someone from blowing an account or losing in FOREX.
The U.S. retail FOREX market is an infant when comparing it to the U.K. and various other places. Yet
they don't see the need for these kinds of rules and restrictions. If you are so worried about the
consumer you should educate them and not restrict them.
Because an educated trader will know better when the time comes. Limiting leverage or some of these
other ridiculous things the lawmakers that be come up with all in the name to protect us from
OURSELVES? What a pathetic joke. If it's not obvious already I would hope that you elect to leave
leverage rates the way they currently are at the minimum of 100:1. Otherwise the blood of the retail U.S.
FOREX markets are on your hands and the people you are trying to protect will be leaving your
jurisdiction in droves. This indeed is a promise. After the NFA Hedging rule was put into effect, I was
ready then. What in the world is going on, is Washington on a self destruct mission?
Please
remember, this is America! Let's keep it that way.
Sincerely,
Cary LaCost
