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Google the DTC (Deposit Trust Company), DTCC (Deposit Trust Clearing Corporation), and "Cede & Co"....... what you'll learn will shock you!
The image above is from the 2014 Annual Report of DTCC. They made over $9 BILLION in investment income.....who's money are they investing?
Here is a link to get you started:
https://www.caseyresearch.com/articles/why-your-brokerage-account-isnt-as-safe-as-you-think-it-is
IF YOU PARTICIPATE IN A SYSTEM YOU DON'T FULLY UNDERSTAND, YOU WILL BE TAKEN ADVANTAGE OF.
The image above is from the 2014 Annual Report of DTCC. They made over $9 BILLION in investment income.....who's money are they investing?
Here is a link to get you started:
https://www.caseyresearch.com/articles/why-your-brokerage-account-isnt-as-safe-as-you-think-it-is
IF YOU PARTICIPATE IN A SYSTEM YOU DON'T FULLY UNDERSTAND, YOU WILL BE TAKEN ADVANTAGE OF.
Stock Market
Investing
Money
Edited 9 y ago
Posted 9 y ago
Responses: 6
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You own your investments. How you own them is a different question. If you own a stock in Ford, than your ownership and voting rights and profit sharing are equal to your percentage of ownership.
If you own real-estate; the question is; do you own it, or do you have a mortgage? if you have a mortgage, your ownership is equal to the percentage of the equity not owned by the bank. If you have a partnership, you own a share of the partnership until one of the partners departs, then the partnership dissolves.
If you own a mutual fund... there is a mutual fund manager that manages the investments, and while you have an investment, you don't really own the fund, because the money is yours, but not the fund.
If you own real-estate; the question is; do you own it, or do you have a mortgage? if you have a mortgage, your ownership is equal to the percentage of the equity not owned by the bank. If you have a partnership, you own a share of the partnership until one of the partners departs, then the partnership dissolves.
If you own a mutual fund... there is a mutual fund manager that manages the investments, and while you have an investment, you don't really own the fund, because the money is yours, but not the fund.
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99% of all stocks in the U.S.are legally owned by them so is the risk. You can't be suggesting using stock certificates instead of using the "street name" of the brokerage firm and letting them hold them in trust and trading them for you. That would be a grinding halt to trading as we know it and make the system rather cumbersome.
If we are going to go down the road of who owns what don't forget N.M. Rothschilds, William Rockefeller, Paul Warburg, Jacob Schiff and James Stillman. There is nothing new to the how the 1% hold and "own" all the wealth.
If you have some grand plan in taking control of 23,000,000,000,000 dollars in assets I'm all ears.
If we are going to go down the road of who owns what don't forget N.M. Rothschilds, William Rockefeller, Paul Warburg, Jacob Schiff and James Stillman. There is nothing new to the how the 1% hold and "own" all the wealth.
If you have some grand plan in taking control of 23,000,000,000,000 dollars in assets I'm all ears.
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SPC David S.
It the case of the article with MF Global - If a brokerage firm fails and securities are missing from customer accounts, the Securities Investor Protection Corporation (SIPC) will request that a federal judge appoint a trustee to oversee the liquidation of the firm's assets and thus orderly transfer the customer accounts to other brokerage companies. However, SIPC does not provide blanket protection for losses. The purpose of SIPC protection is to replace securities that are missing (or illegally used) when a brokerage firm fails. It does not make up missing value for securities that have lost market value while missing or for investments that the customer may feel he or she was ill-advised to make. Additionally there is a $500,000 limit. this includes $100,000 in cash. As well some securities are not covered at all. There is the Financial Industry Regulatory Authority (FINRA) that deals with unsuitable investment advice, negligence or churning (excessive trading for commissions). However in many cases the money is hidden - the person does a little time and they retire with your money.
I think what would be interesting for investors is if brokerage firms had to declare all intentional fails - and thus the reason for their fails (last paragraph of page 2 in attached pdf). I think an investor should always look at the controls on their investments - yet few do when the returns are good its only when things go into a free fall they begin asking where the hell is the safety net.
Buyer beware!
https://www.sec.gov/rules/final/2008/34-58774.pdf
I think what would be interesting for investors is if brokerage firms had to declare all intentional fails - and thus the reason for their fails (last paragraph of page 2 in attached pdf). I think an investor should always look at the controls on their investments - yet few do when the returns are good its only when things go into a free fall they begin asking where the hell is the safety net.
Buyer beware!
https://www.sec.gov/rules/final/2008/34-58774.pdf
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LCDR Ben Bines
SPC, I wish I did. My goal, again, is to be sure our service members understand the landscape they are operating in. Choosing to participate after one can find the potholes for oneself is perfectly fine. Being told "that's just the way it is and it must continue to be" is a free pass to being a victim.
Are you honestly saying there's a difference in safety of assets by having Cede & Co on every stock certificate? All the traceable information on iwnership is server based...what's the point of having the certificate given this operating system? it will add 0 clarity if the data is ever lost (a very extreme circumstance of course, but not impossible).
Are you honestly saying there's a difference in safety of assets by having Cede & Co on every stock certificate? All the traceable information on iwnership is server based...what's the point of having the certificate given this operating system? it will add 0 clarity if the data is ever lost (a very extreme circumstance of course, but not impossible).
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SPC David S.
The big push for dematerialization is in the reduction of settlement risk in the T+3 time frame to just a T+1. Obviously this can not happen with paper.
You would think that with today's technology it would be a mater of attaching ownership to stock ID where the ownership could be switch in an instant with an update query on a database. Regardless however you just have an ID number in a database managed by some other entity. No more paper but the question of 'When does short selling become manipulation?' never has to be answered as the system would prevent this. If you don't have it you can't sell. As well other market manipulators would be exposed. I think as of now fails are listed but still allowed to occur via the T+3 process.
I will say that when it comes to appraisal rights and mergers the claims of efficiency with Cede & Co. become a bit nonsensical.
You would think that with today's technology it would be a mater of attaching ownership to stock ID where the ownership could be switch in an instant with an update query on a database. Regardless however you just have an ID number in a database managed by some other entity. No more paper but the question of 'When does short selling become manipulation?' never has to be answered as the system would prevent this. If you don't have it you can't sell. As well other market manipulators would be exposed. I think as of now fails are listed but still allowed to occur via the T+3 process.
I will say that when it comes to appraisal rights and mergers the claims of efficiency with Cede & Co. become a bit nonsensical.
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LCDR Ben Bines
Why would short selling be manipulation? If one entity is willing to bare the risk of a short position, and the costs associated with obtaining that position, how is that manipulation? Short selling has as much validity as buying on margin. The world does not always increase in value SPC. That's simply something those selling assets would like us to believe.
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