Reply #95: Refco just another deal among friends [View All]

[UpInArms]

http://www.marketwatch.com/news/story.asp?guid=%7B4F882BEE%2D343B%2D4A84%2DA740%2D9BCF244EF6B4%7D&siteid=mktw

NEW YORK (MarketWatch) -- The small investor has a message for all the banks, private equity firms, accountants, underwriters and everyone else who stood by and watched as Refco Inc. took the keys and drove off the cliff: welcome to the party.

As long as there have been investors, markets and taxes, it always seemed as if the joke was on the little guy. The widow who invested in WorldCom. The retirees locked into Enron Corp. The suckers who laid down hard-earned cash for Henry Blodgett's P.O.S.s.

In August, Refco (RFXCQ) became a public company. But make no mistake, this is a Wall Street insider vehicle of the highest order. Specializing in futures contracts, commodities and other complicated instruments, Refco was as recognizable to the average investor as Phillip Bennett in a clown suit.

But on Wall Street, Refco was an institution. For nearly four decades, the firm and its traders were a common sight on trading floors especially the Chicago Mercantile Exchange. They were as common there as the golden arches, the green siren and the color brown are to you and me.

In an industry that extols the virtues of the relationship, Refco was family. And when family comes to you with a favor to ask, it's only natural to help first, ask questions later. To do otherwise is taboo. What? You don't love your baby brother?

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