Comment Text:
i0-001
COMMENT
CL-05052
From:
Sent:
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Subject:
Roland HOrvath
Friday, February 5, 2010 12:18 PM
secretary
Regulation of Retail Forex
Leverage is the instrument used in Forex that allows those of us with small amounts of money to control
large amounts of money in order to make a larger profit on the money we have available to us to trade.
Basically it is the bread and butter of our industry. Without it the ability of the retail trader to grow their
account and earn an income off of their profits becomes severely handicapped, if not killing the
possibility outright.
To be fair it is high leverage that creates the opportunities for massive failure and losses as well, as most
of us have experienced at one point or another. However someone who trades for a living understands
this and has learned how to manage that risk.
I get why they[re doing it. I do. When you look back on the last decade (you could even go back,
arguably, to the last 3 decades) and see that it has been the lack of regulation, the lack of limits and the
lack of accountability of corporations and banks that have led us, slowly but deliberately, to the current
degradation of the global economy. Doing so allowed the corporations, banks and insurance companies
use whatever means possible to make their money [ even if that meant bilking their customers, depleting
demand and moving onto the next industry and/or country to sustain those business practices. Because
money has influence it also allowed them to have the largest voice out of all of us with our policy
makers, louder through funding, louder through profit and louder through payoffs. They [ve been able
to use deregulation as a way to plunder through our resources, and the resources of other countries, as a
way to increase profits to the point that the influence of their money is a larger driving force behind our
decision makers than any voice the American people can have, even if we could ever become united in
cause and purpose.
That being said, it is no surprise to me that there is a strong move by current policy makers to curtail that
Viking action and put in some limitations, regulations and accountability, however it is my contention
that this proposal will do more harm than good. It will not regulate the big accounts; it will penalize the
small accounts. Us.
It will make it nearly impossible for someone who has a small amount of money to build an account to
the point that the profits from that account can sustain them financially. By making that impossibility we
face the probability of a mass exodus from this sector of the financial industry. People will be forced to
give up their hard earned trading practice or move their accounts overseas. Both processes have already
begun when the NFA interjected their first leverage limitation and eliminated hedging in FX in 2009.
US dollars will leave the US and fund the FX industries abroad. US dollars will be making money for
non-US companies. That is not in our best interest. Retail traders will find it difficult to navigate to
trustworthy brokers in countries whose laws they [ re not familiar with or in touch with. That is not in
our best interest.
While that financial consideration is going to be in the forefront of the conversation here is the
unintended consequence that I[m most afraid of. When the government steps in to finally make
investors accountable and it hurts the little guy so much harder than it hurts the big market makers
(corporations, banks and insurance companies) [ and it will [ I fear that it will further fuel the []get
government out of our lives [ sentiment of voters.io-ooi
COMMENT
CL-05052
When we successfully rid ourselves of regulation and accountability by our representatives in
government we empower and embolden the financial war lords to continue their pillaging both on our
shores and abroad. We can,t risk any more of that. We simply cannot.
