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Knight 2.0: Jefferies Rescues FXCM With $300 Million Bailout, CNBC Reports

Tyler Durden's picture




 

In an apparent replay for 2012's Knight Trading algo-implosion $400 million cash-infusion bailout, Jefferies (owned by NY-based I-bank Leucadia) is riding its white horse to the rescue of FXCM and its $200-million-plus client losses:

  • *LUK IN $300M DEAL TO LET FXCM CONTINUE NORMAL OPS: CNBC
  • *LEUCADIA GIVE FXCM $300M IN FINANCING CNBC

Leucadia will get $250m in senior notes as part of the deal, CNBC says. So - in summary - a central bank blew up an FX broker and a mid-market junk-bond underwriter bailed them out... must be good for a green close for the week in stocks!

No statement from either side yet.

* * *

So FXCM can back to more of the same?

 

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Fri, 01/16/2015 - 16:16 | 5671657 clade7
clade7's picture

Meats back on the menu boys!

Fri, 01/16/2015 - 16:19 | 5671670 Manthong
Manthong's picture

This just occurred to me..

Regardless of the reason for pulling the peg, the fact that the SNB did it in such a sudden and violent manner and forced such huge losses on the modern façade of a market tells me two things,,

1.    They had to be on the other side of the trade somewhere to hedge against what they had to know was going to be a huge book loss (just the everyday evil you expect from a central bank).

2.    They felt compelled to do it all immediately because they are aware of certain clear and present dangers.

Otherwise, they could have just “communicated” their “policy” “intentions” and unpegged in manageable steps.

 

Fri, 01/16/2015 - 16:22 | 5671693 knukles
knukles's picture

Look'd dis shit.

http://en.wikipedia.org/wiki/Leucadia_National

Why aren't regulations enforced about the kinds of no no businesses a bank and affiliates can not be in?
They've an appearance of incestuousness!

Fri, 01/16/2015 - 16:34 | 5671729 kliguy38
kliguy38's picture

Thaz just a mere formality.....now move along prole

Fri, 01/16/2015 - 16:37 | 5671738 ilion
ilion's picture

Some talk on the streets that fresh and strongly capitalized Tickmill is in talks to buy Alpari's non-UK client base. Deal could be announced this weekend.

Fri, 01/16/2015 - 16:49 | 5671805 Richard Chesler
Richard Chesler's picture

OPERATOR: Leucadia Natonal, how may I diect your call?

CALLER: Yea, this is Mr. Yellen...

 

Fri, 01/16/2015 - 16:54 | 5671834 kaiserhoff
kaiserhoff's picture

That hair ball ad says all you need to know about that boiler room.

I wonder who will bail them out next.

Fri, 01/16/2015 - 17:00 | 5671853 EmmittFitzhume
EmmittFitzhume's picture

It's fitting that CHF acronym also means Congestive Heart Failure

Fri, 01/16/2015 - 19:05 | 5672283 Colonel Klink
Colonel Klink's picture

Looks like that company is packed full of tribe.  Any questions?

Fri, 01/16/2015 - 20:01 | 5672396 zeropain
zeropain's picture

#2 Greece or German exit.

Fri, 01/16/2015 - 16:53 | 5671828 Ruffmuff
Ruffmuff's picture

I love when everyone lines up to save my ass on a bad trade. I'm in the wrong club, I guess.

Fri, 01/16/2015 - 16:14 | 5671658 SickDollar
SickDollar's picture

countdown to 3:59 pm , keep a close eye  today bitchez

Fri, 01/16/2015 - 16:16 | 5671664 Slurm
Fri, 01/16/2015 - 16:20 | 5671680 Slurm
Slurm's picture

Time for our daily Ukraine news....

 

 

https://twitter.com/unkn0wnerror/status/556157647658172416

 

 

Fri, 01/16/2015 - 16:29 | 5671719 disabledvet
disabledvet's picture

Looks like my flight will be delayed again.

Fri, 01/16/2015 - 16:58 | 5671789 Manthong
Manthong's picture

At least the place is kept up better than Heathrow.

But those poor Uke bastards should feel a little better when Porko sends the 60 year old vets to help out after their   two week combat refresher course.

Ukrainian fighters: "We are just 'cannon fodder' for Donetsk airport"

Ukraine President Signs Mobilization Decree: 50,000 To Be Drafted

-aged 25 to 60..  Combat trainings for servicemen will take 10-15 day 

 

Fri, 01/16/2015 - 18:28 | 5672153 Freddie
Freddie's picture

Here is Givi and Motorola raining down some motar fire on the Ukies.

Givi and Motorola call the truck moving the Ukies in and out of the airport "meat wagons" because they just pick up bodies all day.

https://www.youtube.com/watch?v=8l4mvWzO1dE

They don't want to fight and kill Ukies but they have no choice.   NovoRussians will treat the Ukie's better than Kiev will.

 

Fri, 01/16/2015 - 16:19 | 5671682 max2205
max2205's picture

Flash  fed buys cnbc 

Fri, 01/16/2015 - 16:23 | 5671697 ebworthen
ebworthen's picture

It will all be thrown onto the backs of current and future generations via .gov and Central Bankster skullduggery.

The things that caring Parents tell their children never to do - done by Washington & Wall Street with reckless abandon.

Such perversion!  Bailouts for gambling financiers and endless money at the Treasury window for Banksters at 0.25% to lend out to sheeple at 4.5%-29% with ZIRP on savings for the working class.

Welcome to Biff's World!

Fri, 01/16/2015 - 16:24 | 5671705 disabledvet
disabledvet's picture

This is all a head fake and a whole lot of nothing.

 

If Switzerland itself collapsed tomorrow who here would care?

 

My point exactly.

Fri, 01/16/2015 - 16:26 | 5671710 Big Brother
Big Brother's picture

WOOT! WOOT!  I live to trade another day!

Fri, 01/16/2015 - 16:32 | 5671723 disabledvet
disabledvet's picture

"We'll start with rupiah.  We'll allow...an extra ten percent for every dollar you put down."

Fri, 01/16/2015 - 17:00 | 5671735 medium giraffe
medium giraffe's picture

If you think this is good, just wait until you see our fantastic 2 for 1 FX bucket sho...ah, brokerage, deals in February!

Fri, 01/16/2015 - 16:49 | 5671812 Jano
Jano's picture

Tax payers bite it.

Fri, 01/16/2015 - 16:50 | 5671818 Quinvarius
Quinvarius's picture

You know the Fed is behind every one of these deals.  Can't wait for Buffet to announce his FX aquisition.  No one would buy this shit without a Fed/Treasury backstop because no one really knows the extent of the losses yet.

Fri, 01/16/2015 - 19:12 | 5672298 WillyGroper
WillyGroper's picture

I understand an AIG VP is missing...

BOLI?

Fri, 01/16/2015 - 16:51 | 5671819 Goldbugger
Goldbugger's picture

And anothre bailout...

Fri, 01/16/2015 - 17:05 | 5671863 franciscopendergrass
franciscopendergrass's picture

Fire sale!

Fri, 01/16/2015 - 17:12 | 5671902 Big Brother
Big Brother's picture

Jeffries probably bought FXCM with the money they made shorting the EURCHF.

...Pure irony.

Fri, 01/16/2015 - 17:20 | 5671934 debtor of last ...
debtor of last resort's picture

HFT's buying HFT's. As expected.

Fri, 01/16/2015 - 18:20 | 5672141 Paracelsus
Paracelsus's picture

Breathing life into Zombies is not a policy option if you expect market discipline to be maintained.

Moral Hazard. Let them fail.I would rather see leaping Bankers,preferably Central bankers.

One beat-up,rusty Guillotine put into operation would go a long ways in solving  this issue.

I think the question on a lot of minds is:  Why was it okay to let the market slide in '87,and not now? 

Fri, 01/16/2015 - 18:57 | 5672253 MarcusAurelius
MarcusAurelius's picture

Doesn't this firm just sum up everything that is wrong with our financial system. First you get a fine for stealing other money by the hundreds of millions. Of course it is 8 million in fines. Then you list your company on the NYSE because it adds so much to the world. Then you send more of your sheep errr sorry traders to your dealing desk to satisfy your shareholders. Lastly you get caught with your pants down because you allow risk that goes off the charts and it fails. So of course you get a bail out. Just fucking unbelieveable. 

Fri, 01/16/2015 - 23:30 | 5672865 Mr. Ed
Mr. Ed's picture

"So of course you get a bail out..."    Huh?

Let's get a little perspective people :-)

As long as the "bail out" doesn't come from the public treasury, money printing, or my pocket as a taxpayer... BAIL AWAY!

 

(Full disclosure:  Yesterday, I went to "My Account" at FXCM to set up a withdrawal of all funds except profits.  I am pleased to see that now there will be no problems!)

Sun, 01/18/2015 - 00:59 | 5675691 Trestle Rider
Trestle Rider's picture

I lost $45k trading with FXCM, still have perhaps $50 in the account.  I believe if I put in $5k more I will get half price spreads.

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