CURRENCY AND COMMODITY BROKERS
 A wholesale comedy of errors

it is unbelievable, my friend, what brokers in the gold, platinum, silver, diamonds, oil and currency secondary markets are doing to themselves.

Some of these people have labored for years and have learned little.

Every transaction is between two principals. Smart brokers, understanding this, will quickly get out of the way.

Young apprentices in this business need to know that people work all their lives to make a couple million dollars. In this business, however, many of these people hardly are conversant with buyer or his representative. Many never negotiate or document anything. They are just part of a group that has made a pact to include each other if a transaction is done. While there may be some advantages in this pooling of talent and willingness to share the profits,

         There are huge disadvantages.

Large groups often require a large split of fees to make everyone
happy. This never rubs the gentlemen or ladies coming from the other side in a good way. This person may have done all the work him or herself and is expecting a big payday just to find out that they must share the pie with 10 people they don’t know and whom could not possibly have done anything real to make the transaction viable.

More importantly they are generally unrealistic about fee amounts.

They literally think they deserve to make as much money as the
principals. They honestly do. So they divide up the fees and even
have a set template that they say MUST be followed.

A transaction does not work that way. Whatever pleases both buyer and seller will make the transaction. Not demands from brokers. So they end up with nothing, because they think as a collective, if the buyer makes ½ billion, they darn well better also. SO SILLY!

Tell me what other business does the broker; his friends and family
make as much money as the principle

Some Corporations have set up a protocol that allows REAL major fees to brokers. They can make it happen by doing many transactions and not by just one big one, where all brokers get paid as much as the principles involved.

Do they indeed know that is why many buyers and sellers end up chucking a contract and starting over without so many brokers

They do not understand that their methods do not work. An NCND is good but it doesn't help if no transaction is done or you don't know if one has been done.

NO principal can be held to an IMFPA where there is NO CONTRACT to which it references. And guess what, the reason there is no contract, are misguided brokers, who thinking they are protecting themselves, refuse to immediately get an agreement signed by both sides. They think they are securing their pay by hiding their seller or in fewer cases buyer. The truth is they are letting the principals off the hook.

RELATIONSHIP

Among the brokers their must be someone with a real relationship with their buyer or seller. Not just email address or phone number. Otherwise, it is difficult to do a REAL professional transaction.

A buyer or seller who is a professional wants to know with whom they are dealing. To whom shall I issue the LOI  To whom shall I issue the FCO

RIGHT THERE!
If you cannot do this, you likely have moved away from the professional to the unprofessional side and you are not going to close a transaction.

Understanding that the brokers are caught in this MATRIX-LIKE catch 22, here are the first things I try to do

1. Have the brokers give me the seller’s name with a seller's code, if LOI is needed. I supply FREELY all information needed to issue the FCO.

2. FOR any FCO or different offer. I ask them to add an IMFPA along with seller’s code, transaction no. and hopefully signature of seller.

That way, at least they would have the name of seller (better to have
his signature) but the brokers send sanitized documents. (A mistake)
The IMFPA is meaningless without a signed .contract. There is no
protection.

Sanitized documents, without the name of seller (or his signatory representative) and his signature does not constitute a legal offer.
It is therefore unenforceable.

But I will sign off on a document with seller's name and especially
signature. Add my buyer's code and all of a sudden a meaningful
and enforceable document emerges.

Since brokers have often worked hard to find a partner for their buyer or seller, why is it that the brokers for the seller so often refuse to show that the seller actually have what the buyer is looking for Many times they will ask the buyer to show his money first.

Yea, you walk into a Mercedes dealership to buy that new car and the salesman walks over to you and kindly tells you that in order for him to show you a car you must first prove you actually have money. Got to make you feel warm and fuzzy, right

You most likely will go elsewhere!

FEAR is the broker's World War Three and the brokers are
suffering too many casualties.

by Bill Sullivan