Ronin Capital LLC has failed to meet CME clearing requirements and had its portfolios liquidated at auction this morning.

This firm had been levered 51x assets/equity as of a March 2019 filing! Not unlike some Primary Dealers, who also happen to be CME clearing firms. This means a 2% decline in asset value wipes out the equity. We’ll never get to see it’s filing for Dec 31, 2019…

Here’s a list of clearing firms associated with the CME.

The dominoes are falling.

I am watching closely to see if/when the Fed begins to wave regulations allowing its member banks to lend more freely to their associated broker/dealer entities who don’t have direct access to Fed lending.