So I just got this message from my broker TD Ameritrade.
Basically this means that if they don't like where the price is heading they can simply take my assets and sell them on the market to manipulate the price in a direction that they want.
Ethereum fixes this. This is why we need real DeFi marketsmarket. We need contracts that are automatically executed and do not change rules in flight.
The US is a corrupt banana republic where laws don't mean anything. Someone does not like negative oil prices and uses wall street to correct them.
Seriously WTF.
So here is my question:
Is there a way to deal with this legally? I.e. can I sue TD/wall street for breach of contract. After all I entered a contract that they now want to change?
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"as authorized by the terms of your Futures Client Agreement"
Sounds like you've already authorized it, legally speaking, so I doubt there is much you can do. Unless they made that bit up of course. You would just have to find a different broker with different terms, if that's even possible.
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Great point. This is definitely a reason to use DeFi.
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There are repercussion when investing in markets. Although it is not fair that TD may automatically sell holders' assets the reality is they do so for the sake of their own survival. Last week oil hit a historic -$37 at one point. This lead to people who were holders of the contract in negative territory. Individual accounts if they did not have enough liquidity to cover the $37 were basically being covered by TD Ameritrade. Of course TD is not so generous as they are a business to make money and is not the government that can print out infinite money. This note is really a plain and simple warning to not trade oil futures. No way to know if oil will go negative again. Since watching this unfold I am avoiding oil contracts like the plague. Do not want to invest in something that basically makes me have to pay more to own on top of what I already paid for. Crazy but will happen again. History may not repeat but rhymes. Treasury bonds in the future may be like this too. Negative interest rates. Buy something and continuously pay back the government interest to hold the asset. System is breaking down.
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