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Veteran Advisor

This post could cause a problem

Hello. I debated if i should talk about this discussion held at the brain trust, but with everyone at the table, with their

smart phones, and over 100 years of experience, this question, frankly has us stumped, and an agreeed upon opinion

has been reached.............

 

The question, are some CME contracts legal ?  The basis is usually on state law and contract law, and some regulations

thrown in for good measure.

 

In most states, there are some basic guidelines as to who can and can not enter into a contract.  From our research,

in our particular state, if a minor enters into a contract it can be nulled, due to being a minor.  Also there is some level

of competence that must be addressed.  if a insane person enters into a contract, it is null, and in many instances,

such as being under the infulance, and a recent case, if you are recovering from anestia within 24 hours, a contract

is null.

Also, it must someone/thing capable of making a contract.  in most states, an animal can not enter into a contract,

although it's guardian can on it's behalf, but, in such instance the guadian must make offer and the like since  the

animal is not human.

 

also one of our bright people, did some scanning about contract law....there are some things that must happen for

it to be a contract, such as stated action/condition, consideration, and performace.

 

ok elcheapo (or by this time, you may think elwindbag), get to the point.....

 

the point is this, computers (no humans), are making offers, are binding contracts, bidding, contracts on the CME.

As has been stated many times, here and other places, action is so fast, and so many trades, that only computers

can do it.

So, can a computer enter into a contract, after much discussion, the overwhelming opinion is NO

if a minior, an insance or incompetant person can not, if a cow, horse, sheep, chicken, can not, how can a non living, non

breathing machine offer, make and bind a contract ?????

BEFORE you say, "its just a tool"......that would be ok, IF on every trade a human would have to hit the enter button,

as it is now, there is no human involvement to start, or make a contract.

as reported, trades are made so fast, and so many, it would be impossible for a human.......that is the evidence that the

machine has made offers, made binding contracts, and has made sales........

 

SO.......since you have a non=person enter into a contract.....and remember the cftc rules and regs about trading....such

as the "person" an alien.....etc.....how do we handle it when the person ordering a trade, or making a trade is not

human ???

 

therefore, the contract can not be valid

 

 

OK.....lets watch the fur fly !!

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11 Replies
Veteran Advisor

Re: This post could cause a problem

If a machine is initiating the action [without a human oky doky], then it might not be legal (?).

 

If a human says they want to contract to sell xxxx bushels Dec corn when the price reaches $5 or higher, and that offer is good until cancelled, then leaves it up to the machines to execute that order when the buyer and right price comes along, then that seems legal to me.  "It's just a tool."

 

And, even "illegal" contracts can be acted upon or fulfilled -- they just cannot be legally enforced if one of the parties wants out of it, or doesn't deliver on their side of the bargain.

 

Of course, just my opinion.

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Senior Advisor

Re: This post could cause a problem

If someone can hijack a car and crash it from 10 miles away just think what they can do with these machines. The rule of law is dead in this country. Stay away from the thieves as much as possible and watch out for yourself.

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Veteran Advisor

Re: This post could cause a problem

Simple question:

Who owns the computer and the money in the trading account, the computer or the owner of the computer?
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Veteran Advisor

Re: This post could cause a problem

gio. that question came up.  it was concluded it is somewhat an "agent issue".  The same illistration was made of that of

a vending machine.  It is illegel for a vending machine to sell smokes and beer, because there must be "qualification"

the same with a futures contract.  Someone mentioned if the computer was told to do something at a certain price,

but, a computer is not human, and buy and sell, esp in a regulated environment, we believe, is not permitted.

 

hence, why a hurry to do away with humans in the market.

 

one person remembered, there was a preposal that all trades, even electronic, a human, must hit a return button.

 

(for each and every trade)

 

what happend ?

 

 

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Veteran Advisor

Re: This post could cause a problem

So do I have recourse to recoup my losses if my 12 year old son hits the buy and sell buttons on my computer?

NEVER IN A MILLION YEARS.
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Senior Contributor

Re: This post could cause a problem

SCOTUS has deternined that corporations are people  !!!!! They could say computers are also !!!!!

 

 

John

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Veteran Contributor

Re: This post could cause a problem

Wasn't there a ruling some place recently that corporations are people and thus treated as people

Am I correct about this or not??

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Veteran Advisor

Re: This post could cause a problem

Wasn't that corporation-as-people in reference to political campaign contributions?  Actually, that's what most of us recently think of when the subject comes up.  There's a lot more to it --

https://en.wikipedia.org/wiki/Corporate_personhood

 

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Veteran Advisor

Re: This post could cause a problem

If corporations are "people" why can't the executives be held personally responsible when the feds

  impose fines for illegal behavior by said "people"?Smiley Mad

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