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the Dallas based cotton futures broker was unable to honor the contract when the cotton was ready for delivery.
What was the Dallas-based broker unable to do, exactly? If the farmers had actual cotton ready for delivery then money was coming the other way, so what is the problem?

And if the Dallas broker was on the wrong side of a trade and could not meet a margin call, that's what the futures exchange clearinghouse and daily mark-to-market are there for.

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith

by Migeru (migeru at eurotrib dot com) on Sun Nov 30th, 2008 at 03:32:26 PM EST
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