Michael Hastings Comment On Regulatory Notice 22-08
Michael Hastings
N/A
1. Leverage to the extreme has gotten us into a lot of financial problems ... people, companies, cities, states, the country as a whole and the world. Mortgages with no money down (total leverage), 5X and 10X leverage bond products sold prior to the 2008 crash or 3X funds for stocks or commodities.
Often, when these investments break down, the issuers get off with a slap on the hand and the investors pay the price.
SO, spend more time watching and punishing the issuers as well as targeting those products with limits on who can buy.
2. Many leveraged products are how the 'Rich get richer'. The NON-rich should also have an opportunity to use these investment products.
SO, prepare some "pop up" information boxes that appear when such investments are initiated. Maybe certain questions must be answered accurately in order to move on.
Frankly, I do think people should have to demonstrate some understanding of the risks and operation of leveraged and inverse products. However, once they demonstrate that, they should be free to invest in a world kept safe because you are spending more time watching the issuers of such products.
Michael Hastings Comment On Regulatory Notice 22-08
1. Leverage to the extreme has gotten us into a lot of financial problems ... people, companies, cities, states, the country as a whole and the world. Mortgages with no money down (total leverage), 5X and 10X leverage bond products sold prior to the 2008 crash or 3X funds for stocks or commodities.
Often, when these investments break down, the issuers get off with a slap on the hand and the investors pay the price.
SO, spend more time watching and punishing the issuers as well as targeting those products with limits on who can buy.
2. Many leveraged products are how the 'Rich get richer'. The NON-rich should also have an opportunity to use these investment products.
SO, prepare some "pop up" information boxes that appear when such investments are initiated. Maybe certain questions must be answered accurately in order to move on.
Frankly, I do think people should have to demonstrate some understanding of the risks and operation of leveraged and inverse products. However, once they demonstrate that, they should be free to invest in a world kept safe because you are spending more time watching the issuers of such products.