"Without this information, it's difficult to assess the counterparty and collateral risk embedded in an ETF or fund, " says Steve Kole, an investor in Texas.
Bringing complicated derivative exchanges out of the shadows would enhance market-price transparency, and increased collateral requirements would reduce the risk of investors and banks being wiped out by mistaken trades that allegedly threaten the financial system.
But this introduces significant counterparty risk, without any clear collateral requirement and with no limit on leverage.
The aim was to break out of collateral-based lending, making no-collateral loans based on evaluation of various risk factors.
But if Mill Financial transfers the money first to Mr Hicks, Mill Financial is taking something of a risk, unless Mr Hicks transfers very substantial collateral to Mill.
But compared with Western banks, which hold lots of esoteric securities, its assets are skewed towards bonds and paper that can be used as collateral to borrow from the Central Bank, lowering funding risk.
Since the deposit acts as collateral, you can get the credit card at low risk to both you and your lender, so approval is likely to be easy, regardless of how bad your credit is.
But if the money were to come from the EFSF, well in those circumstances Finland has said it would fear that the money would be too much at risk of loss - so it is demanding collateral or security for its share of any such loan.
But this would involve loosening its collateral conditions and exposing the central banks to greater and greater risk.
ECONOMIST: How much do Greece and the rest of Europe stand to lose?
And once again, since the home is used as collateral, a failure to make timely payments can put it at risk.
Collateral requirements, like those on futures exchanges, might deter excessive risk taking.
Multinational buyers can work with lenders to facilitate financing, using purchase contracts as collateral or using their relationships with farmers to originate loans, assess risk, and collect payments.
What this creates is chains of counterparty risk, where multiple re-hypothecation borrowers use the same collateral over and over again.
They also use requisitioned land as collateral for bank loans, adding to the potential woes of a banking system in which risk is poorly understood.
All big banks require hedge funds to back up their swaps with cash collateral that is adjusted daily, says Kathryn Dick, deputy comptroller for credit and market risk at the Office of the Comptroller of the Currency.
Bankers still struggling with declining collateral values on their commercial real estate loans and tougher scrutiny from examiners aren't going to risk hits to their capital by lending to weak firms until the economy is in a clear upswing, says James Whitney, of Conway MacKenzie, a Birmingham, Mich. financial consulting firm.
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