Comment Text:
i0-001
COMMENT
CL-04767
From:
Sent:
To:
Subject:
Stefan Kiss
Tuesday, February 2, 2010 2:39 AM
secretary
Regulation of Retail Forex
Hello,
I am very concerned about the proposal to increase the margin requirements for Retail Forex,
for more than one reason.
First, on the personal level, I have been training for a year to be a trader. I am about to
launch my trading business as a corporation.
A new regulation like this would severely limit my ability to grow my trading account.
I am 55 years old, my retirement savings are not going to last a lifetime.
Yet, now after this year of intense study and training I am confident I know how to manage
the realities of leverage and loss control. I am confident I can do this and do well.
What alternatives do I have? Even though I am smart and technically skilled, no one is going
to hire me at my age.
And, I am not alone...there are likely hundreds of thousands like me in my age group with no
employment future .... and probably millions of younger Americans who will be unemployed or
underemployed for a long time. The jobs shipped to India (tech jobs) or China
(manufacturing) are not going to come back.
In response to this, many, many US Citizens are learning to trade. Some are going to do well,
if you don't change the regulations. There is an infrastructure being built out now in the
educational and brokerage firms, and even the banks, that are preparing to serve this new
demand. Please take a look at this. It is not small.
Those people who are suited for the career of trading, allowing themselves to become well
prepared, practiced, and trained, will have self created jobs, they will be paying local taxes,
and Federal taxes. They won't need unemployment, and they have money to spend in their
local economies. Not only that, they can work from home, creating less demand for oil, and
less traffic.
(Not everyone will have an aptitude for this work...but many will.)
The use of leverage in the Forex retail market is a beneficial thing to a person with the right
skills to use it. It is not like giving a mortgage to someone who has no money. And, it is not
the same as the leverage created by the Investment Banks that caused the financial system to
almost collapse. It is not the same dynamic, and its scope is very small. Please don't make thei0-001
COMMENT
CL-04767
mistake of seeing all leverage as evil. The leverage in the Forex market, if used wisely, allows
a well trained individual to create an income for himself, and his family, without relying on the
external job market, and without the need to have a million dollars to invest.
BUT, beyond that...there is now an infrastructure being built in the US to serve the retail Forex
trader. If you implement the higher margin requirements, first this infrastructure and all the
jobs that it is creating, is about to create, and will be creating, and all the tax revenue that
goes with the business income, and those jobs, is going to disappear. It will never form.
Instead it will grow outside your jurisdiction. You will be giving all the transaction business to
London or Switzerland, or even in the future, to Hong Kong or Singapore. Or Australia or New
Zealand .... I'm sure they would love to have the business. The only limitation is how they can
access the fastest internet backbones.
There are already very good, highly regulated Swiss Forex brokers, more than willing to accept
the US customers you would be pushing away. The same for London.
(By the way, London probably has more Forex transactions than the USA in any given day.
The US is the second market.)
If the US Forex Retail Trader moves his accounts to London or Zurich, that in turn would force
US Retail Forex Brokers, if they wanted to stay in business, to move offshore outside your
regulation, taking the jobs with them, and the payroll tax revenue, if not more.
You have a tremendous opportunity here to allow the formation of a new industry in the
United States .... one where well trained individuals (i.e. "taxpayers") can participate in the truly
massive and dynamic world's currency markets, having equal access as the worlds largest
banks. This type of access is relatively new...with a new type of Retail Forex Broker building
out the infrastructure and creating a base for secure and integrous transactions required by
the Forex trader.
Really, I cannot see any positive outcome for our country, if these regulations are
implemented.
Actually I would suggest the opposite .... keep the margin requirements as they are, and
institute college level trainings for a person to enter the self-employed trading profession, so,
if they are capable, can compete against the giants with success. The tax system and local
economies will thank you.
Thank you.
