Leo Melamed
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Leo Melamed is one of the elder statesmen of the global derivatives market. He was born in Poland in 1932. The family name at the time was Melamdovich. In 1939, the Japanese consul general to Lithuanian, Chiune Sugihara, issued his family a life-saving transit visa, and they made the long trek across Siberia to safe haven in Japan. They crossed the Pacific to the US in spring 1941 and the family settled in Chicago.
Leo Melamed was chairman of the Chicago Mercantile Exchange 1969-1971 and founding chairman of the International Monetary Market 1972-1977. In 1977, the CME and IMM merged.
Mr. Melamed served as special counsel to CME's board 1977-91.
In 1991 he founded his own global consulting firm, Melamed & Associates, of which he is chairman and chief executive officer. He is also currently a member of the global markets advisory committee of the U.S. Commodity Futures Trading Commission and he is on the board of directors of OneChicago, LLC, an exchange for single-stock futures.
In a speech in January 2005, Mr. Melamed traced the origin of his ideas about finance to his childhood wartime experiences.
In Tokyo in April 1941, he asked his father, Isaac Melamdovich, a mathematics teacher, to explain how the community of Jewish residents in that city had enough money to support the sudden influx of some 3,000 refugees such as themselves?
"Well, to understand that, my father explained, you have to understand the intricacies of the marketplace."
Specifically, the elder Melamdovich explained, "you must never trust the official rate of currency exchange announced by government." The real value was to be found in the "black market," which exists anywhere -- on any street or in any shop, where no government official is looking.
When a Jewish family in Japan received an exit visa in that period, it would deposit 5,000 yen in a bank and receive US dollars (or the currency of the country to which it planned to travel) at the official rate -- say, US$50. That money was quickly and discreetly returned to the Refugee Committee where it was sold on the Black Market for the true exchange rate. The outgoing family received 5,000 yen back, and the Refugee Committee retained the profit to help new arrivals.
External links
- Essays and speeches (http://www.leomelamed.com/essayindex.htm)