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CME Increases Gold, Silver, Palladium Margins
The CME group announced that margins for metals futures contracts on the NYMEX and COMEX will rise beginning February 12 by approximately 25% across various classes. The initial margin for 100-ounce COMEX gold futures will increase to $6,747 from $5,403, while the maintenance margin will rise to $4,998 from $4,002. For 5000-ounce COMEX silver futures, initial margins will increase slightly less: from $6,075 to $6,750 while the maintenance margin increases by $500 from $4,500 to $5,000. Margin increases will be largest for palladium, where initial margins will rise from $2,363 to $3,713, coupled with a maintenance margin increase of $1,000 from $1,750 to $2,750. Additionally, as the full advisory indicates, the CME increase margins by various percentage for virtually all of its product groups.
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+1
I'm going to have to go with gold stampede conspiracy. Obviously 78 freaking billion dollars worth of fake gold sales weren't enough to collapse the market. So I guess they are going to try for a couple hundred billion. Set up some big event and make everyone think that gold is going to go in shitter for several months to try to rake it up. Should be a failblog video by march 15th.
By big you, of course, mean something like $80 big.
I'd be very surprised if gold went under $1k in forseeable future.
Gold is relatively stable past few weeks if quoted in currency other than USD & further USD rally doesn't seem that likely.
For example look at gold quoted in CZK: http://wejn.org/tradi/pmg/gold-12m-usd.png
The dollar's the shit right now, at least over the medium to short term. I'd be careful about thinking it will continue to decline.
The dollar's the shit right now, at least over the medium to short term. I'd be careful about thinking it will continue to decline.
Hmm, you might be right. I know next to nothing about timing and/or short term trading.
I just don't think technical analysis alone will get you anywhere. Not to mention the tunnel vision of dollar being the only safe haven no matter what BB does is also quite disturbing.
Everything's possible. Even paper gold $100. My point was that while gold had about 14% drop when USD denominated it's in quite tight range in other currencies (yes, even in EUR, with about 6.5% DD).
And while everybody's worked up about Greece (and rightly so) most ppl conveniently forget California and other US states that are about the same as Greece (or worse).
That's why I see the USD rally quite unlikely to last. Short term? Why not. Long term? We'll see about that.
Everything's possible. Even paper gold $100.
Yes, on paper at the CriMEX it may trade to $100. I guarantee you're not going to find it in physical for that price that others will let go.
I agree completely. That's why I wrote 'paper gold' in the first place. :-)
not disagreeing with you at all... Just saying that a black market will appear with the paper and physical, as happened in late 08 and when silver gold got taken down you couldnt get your hands on any for the paper price.
CME = Coronal Mass Ejection?
No - COLONIC
har har har har hehe
Every time you post you seem to attempt to slam gold for some reason. Man up and admit you missed the $50 bounce the last few days.
Keep writing those checks . . .
Can't see it going much lower then $1050. Any lower and the people of China are going to start revolting. That's the level they told their people to buy.
Watch what happen grasshopper
Raising margin = sign of desperation/manipulation every time
when you have cancer like AIG it is terminal
there's no cure, not even margin/paper flipping can fix
shed
gold is bought in the market as a real purchase cash on the barrel head
these towering margin machines of paper are ready to implode into the hubris of nothing to back them up.
"Is it possible that gold is fed up with the lies and distortions that are so apparent Mr. Fred barks at the TV? It is, and I sense it happened today.
We have been discussing over the last few days the fact that no currency on the planet is any longer a storehouse of value. We are headed into a system of taking a ticket to get bailed out sovereign wise.
The relationship between leading currency and gold is never going to be cancelled, but it is loosening.
Gold is your only good insurance policy.
Who knows, we may be long gold for a much greater period of time and price than I anticipated in 2001.
Respectfully yours,
Jim sinclair
Wait wait wait... you telling me that people could get gold futures of 100 ounces for only 5,403 dollars?
cash settled, of course.
No, the margins per unit cost/profit on those trades are up to $5,403 . The total cost of purchase would be much higher.
Who buys paper PMs on margin?
not proud of it but made 20% gain this week doing it...sold the margin part today
Can someone explain what this may mean to the price of silver and gold?
It means that they're going down, for a variety of reasons.
Once again I find myself hoping that you are correct. So any idea how fast gold and silver prices will go down and where they might bottom at?
I would say that they bottom under 1000, probably in the 900 range, and sometime near the end of this correction, which I forsee happening in the early parts of March.
That would be my "guess".
OK, Master B, you have walked the plank, and I admire your stubbornly held views. If your "guess" (and I guess as well too...) is the bottom in gold is in the 900s, well:
"Beep, beep, beep" backing up the truck for gold and maybe other PMs.
All this sh@t ain't going to end pretty. (PIIGS in Europe) = (our California, Michigan, Illinois, New York, New Jersey, Florida, etc.). Not even to mention our FEDERAL debts, etc., etc., etc. Sux to be us now.
And what happens if the US decides to have a go at Iran?
Thanks Master. ;)
DEFLAAAAAAAAATION.
It means precious metals are going up, because the shorts will have to pony up additional margin to hold their short positions.
It means they're going down, because the gold bitchez crowd won't have as much margin to run up the price.
I think you are both right, so maybe it just means that we get a more accurate price discovery for physical?
Well, it seems like it'll get a bit of the distortions out of the market, at least for now.
I think that most of the "markup" in physical has to do with procurement costs and the like. It's a lot easier to have and manipulate something on paper than it is to have the actual commodity.
Agreed, sorry about earlier by the way bates. I seriously thought you were a troll. Now I just think you are an ass with a very strong opinion, nothing most people on this board couldn't be guilty of either.
+100
Well, it's better than having a strong opinion and being consistently wrong, like some others...
Look who's talking. Mr Treasuries, you have been wrong time and time again.
anyone see http://www.iamned.com/ ? good articles
No, but I saw your mom's roast beef curtains. They had moldy horseradish, and you could drive an airplane through.
Cetin... or what ever the fuck your name is... go away. Saw your shit a while back at other places... you still fucking suck balls.
Fag
Cetin you spamming mother eff'er!
iamned is Cetin the clown spammer, all he does is pollute sites with his garbage
Is this the second margin increase? I seem to remember reading about a gold margin increase a couple months ago. Couldn't find much googling.
Right as rain, Hansel:
They raised the margin just before Dec 17th!!!
http://news.goldseek.com/GoldSeek/1261062106.php
Fine by me--force all speculators into the physical. Sounds like a plan.
Removing speculators will be bad for the price of gold.
Right, it will be bad for the price of paper gold, no question.
Paper gold can go to $1 for all I care.
Paper gold still represents physical gold.
Physical gold is pegged to the speculation in paper gold.
They're not going to decouple more than they already have. If you want physical gold, you already pay more than the paper gold price. (Try getting an ounce of physical for 1100 bucks if that's the price at the moment) Still, the paper gold effects the physical gold.
you mean "affects"
Attack my grammar all you want. It doesn't change the fact that you're buying an overvalued asset.
I'm trading my Monopoly money for money before dumbasses like you figure it all out and the opportunity is gone ; )
"They're not going to decouple more than they already have."
You are going to eat those words, young fool.
Does that mean COMEX expect PM will be higher than 25%? I can be wrong.
bunch of idiots in here it seems, do you people really not know how margins on futures contracts work?
how does th scam "work"?, please esplain.
Weak specs will get out immediately but to most players it will not matter...however the timing is interesting as we are coming into March delivery and there is still 89,000 ounces standing for delivery in Feb GC. Volatility is way down after the smack down last week and margins are generally set by Vol. Looks to me the Crimex is looking to shake out more long OI.
Yes,it definitely will shack out weak hands either way.
Oh yeah, here we go... Cme, crimex and lmba will ALL go up in smoke
TRANSLATION:
They can't make delivery.
The winner! Palladium delivery issues?
Only rumblings I've heard are Palladium and Gold as some Central Banks want it transferred OUT of the NYC Depository and shipped to Dubai and Hong Kong. RUMBLINGS only gang, you'll NEVER get confirmation from the CME or COMEX on this issue.
Okay assuming that is correct how long can I keep buying physical without a massive increase in premium? Also do you think that this will depress the paper price and also the physical price?
Depends on quantity and who you buy from. If you're buying on the COMEX, good luck to ya!
lol I'm just a small time working man, buying a bit online when the savings allow. Assume it means supply would be drying up. Was hoping for a good long time to save up...
just load up on scotch then - those gold bugs will have to trade their shiny metal for something
That's the thing. The mouse finds food in places the elephant can't. The small guy can get all the gold they want but the central banks and governments can't put together a "big" deal to save their life. Much like they can't put togther a working IPO or bond say before long.j
Think of like this. Intel dies. Dell who's used to buying a cpu for 80 bucks now has to go get 10000 cpu's one at a time from people who paid 150 for them. The good old economies of scale that fuck the indivdual and small business now come and bite big business and big government and big bank right in his ass.
Scribd sucks.
agree, but you can download and read it as a pdf file for nothing........
At current gold price, many investors and institutions will have no trouble to meet this 25% margin increase. A Physical delivery is independent of margin. Does COMEX have enough real gold? Who knows?
It's all tungsten, bro. Go with christ bro.
When people find out that all the gold bars are really tungsten, the price for real gold with QUINTUPLE by June. 6000 an ounce bro. Go with Christ.
"Go with Christ."
Does he know where the gold is?
Without any offense, MB, have you ever owned physical
gold or paper gold?
No, but that doesn't mean that I don't follow the charts daily.
As to owning it, there are so many other assets or speculative ventures that I'd rather own parts of. I never even wanted a gold chain when I was a kid.
Good, you are very honest. MB, if you have the
opportunity, buy one oz American Eagle gold coin just
for the feeling of it. Who knows? You might fall in love
with it and might convert yourself into goldbug.
Best luck!
Gold would jump out of his paw. Let the e-trade baby stick to his paper teat.
Hmm, interesting that you would not even consider some physical gold for at least diversication...
Folks, the increase in margin requirements is not the result of a grand conspirary, any bias on the part of the CME, etc etc. It is simple math meant to reduce leverage and risk to the exchange and clearinghouses.
If gold is $800 / oz, and you're required to hold $5403 for a 100 oz contract, you're only holding 6.7% of the notional in margin. A very solid buffer, such that you could be liquidated before you do damage to an exchange. Now however, if gold is $1100 / oz, that same $5403 of margin is only 4.9% of the notional. By raising the requirement to $6747, you have to post 6.1% of notional now. Heaven forbid gold is one day $5000 / oz like some of you wish, I bet you the initial margin req will be something like $32,500.
Clearly stated. Thank you, sir. This increase is a
non-event.
I don't trade futures, but if your interpretation of the raised margins is correct (seems logical), then this is just a confirmation of the current price by the CME.
winner!
With all respect, I have to disagree.
Margin is a performance bond in that role margin it is first a risk management tool. If you are running the exchange/casino, you are interested in protecting the exchanges interest foremost. Why wasn't margin raised much more substaintally in the Fall when it was topping 1200? Probably because the exchange was OK with the amount and quality of the open interest, ie. specs versus commercials, Also Platinum and Palladium had not skyrocketed last fall like the did in 2010 so there is probably more risk and less quality in the Open Interest.
If volatility were way down and there were no delivery issues, you can see margins as low as 1.5%, >5% is a warning sign that they want to use margin to change the ownership complextion of the market.
When the Hunts where blowing up you had to post 40% margin ,then it went to liquidation only for a few sessions until they could get the Hunts out of the Silver market.
Margin Requirements are a risk management tool.
PS When Gold gets to 5000, they will cut the contract in half so that even the most marginal player can get into the game, just like they did with the creation of the E-minis
I have no problem with the margin increase because it is not that big a deal except that it does remove the leverage risk, not the demand for the metal.
On the flip side, when will we see the margin requirements shrunk for various derivative instruments where GS and JPM can lever their balance sheet up 30 or 40:1?
Until we reduce leverage across the board and reign it in, the entire ponzi scheme is one Greek fart away from disaster.
Many think that raising margins...tanks prices....over the years I've noticed that often the opposite happens...and sometimes dramatically...of course every situation is diffrent and who knows this time?
also regarding actual physical gold available for delivery I thought Kyle Bass had a good take on this recently: Kyle Bass: Gold only enough inventory for 15% to 30% open interest on futures and options, Get “while supplies last”
---PK
In other words, the demand is too high because of speculation.
Hmmm... where else have we seen these bubbles recently?
Remember when multiple people were bidding on houses? Or there wasn't enough oil to meet all the speculative demand? Or when you couldn't get tech stocks because of all the demand?
That's where gold is now. However, what happens when the price drops and nobody wants it anymore?
Would hate to sound like a full blown gold-bug (more of a silver guy), but ---
I'm pretty sure Indians, Chinese (and others) would be buying with both hands if the price dropped significantly.
Maybe 5yo with finga on da trigga and other daytrading monkeys won't be that interested scooping up gold if it breaks lower... but they are not the only players in this "commodity".
And if you ever held gold coin in your hand, you might've noticed the demand for this shiny yellow thing is somehow imprinted in most of us. I know that it didn't take much more than showing Kruegerrand to my friends to get the immediate "i wanna some of that" reaction. Zero demand for gold? Yeah, maybe when everyone on Earth is dead.
"Zero demand for gold? Yeah, maybe when everyone on Earth is dead."
+1000000000000000
I couldn't have said it better myself.
Zzzzzzttt! A year or so ago I took my daughter to a bullion dealer near us. He had a 1 kg. bar, and when I touched it, I felt practically electricity buzzing off it...
Gold ZH's. Please consider buying some physical gold as insurance (vs. the .gov) as well as the BEST wealth preserver I can foresee.
Silver has a worse looking chart than gold right now.
Once it breaks lower, all the people that HAVE BEEN scooping it up will realize that the carcass is bled dry and they'll move on.
It's just like any speculation bubble.
If anything, demand will get lessened, not increased. You can't have much more influence than the "sky is falling" crowd, which has already been around for a couple of years. Once they bail, it's done.
You're right; silver's price chart is ugly.
But please get your facts straight. Bubbles burst when everybody (and their mother) is into that fad.
And I dare you to show me proof of that in gold or silver. Mainstream investors know next to nothing about silver. Or gold.
Just one example: Paulson has big time trouble convincing people to join his new gold fund: http://bit.ly/aX9Z1h Doesn't seem that bubbly to me.
exactly. no one is in it that hasnt been in the PM area for a while. Very few new people in it. When QCOM, AMZN, EBAY et al, were doing their thing right before they crashed I would hear random conversations about them in line for coffee, at a baseball game, on tv, etc... and they were all bullish. Same with real estate. There is no way we are even close to widespread ownership and no new money on the sidelines to pump higher.
And please, go lower in price. Im not stopping from accumulating PM's until the debt bubble is done - and that one keeps getting bigger and hasnt popped yet. Thats when we get the depression, or whatever they'll end up calling it.
I guess youre in the wrong coffee shops.
All i hear are complaints that gold isnt north or $2k given whats happened in the sovereign arena this past few weeks.
This margin call will shake out the marginal player trying to hit a home run with $10k in the game.
doesnt take much to get called and then wiped out if your stake is chump change.
This same thing is happening in the FX arena. Big push to reduce leverage to 10:1 (why thats happening is for another time).
This is simply to shaje the clowns out that cant deliver the physical or make the cash settlement.
So you're saying that pawn shops and payday loan places buying gold and gold commercials on tv don't qualify as "everybody getting in on the fad"?
I think that it's more mainstream than most people would admit.
Paulson has trouble convincing people to join his fund because the big money knows that the jig is up. The bubble is blown. You don't buy high and sell low.
Plus, people that speculate in funds want to see consistent results of making money over time. That's not something that's going to happen in a fund that focuses on a single commodity.
MB,
You're always hanging out on these gold posts. What gets you so fired up about this? Earlier in the comments, you said that 20 days is about the right entry point for silver. Now, in this most recent comment, you say that the jig is up. Cash4gold isn't that everyone is in on gold, it is the exact opposite!! People have no faith in gold and that is why they're selling scrap gold for 25c on the dollar. Ask those around you if they own gold, I bet you know 1 or 2 people tops. Mainstream economists definitely look at it as the barbaric relic. There is no bubble here, at least not yet. Once the "bubble" (or permanent re-valuation) happens, we won't be debating it on these comment boards, it will be self-evident.
Don't be so dogmatic MB. Try to open your mind a little more and question your foundational beliefs. What we are about to endure is something that is unprecedented. All paper will burn. A great source to become educated:
fofoa.blogspot.com
First of all, it's not unprecedented. It's not like that this is the first time governments have been insolvent. Even if it is "unprecedented" and the system crashes, what would the gold be worth anyway?
If you're dying of thirst, you'll give up all your gold for a free commodity like water.
I'm always hanging out in the gold posts because I want the notoriety to be right when my predictions come true.
I see decline in assets until March, and then one last push through the summer, and then we deflate. Deflation isn't good for gold.
If things truly play out like everybody expects them to (IE everybody defaults) we're more likely to have less problems because EVERYBODY will do it and life will go on.
I don't think that will happen.
When people are selling gold for 25 cents on the dollar, it's because they're desperate. But Cash4gold and all that are the ones speculating wildly. What, you think all of those people are the smart ones?
I think that it's ironic that people who are SO closed minded about any asset other than gold are the people who tell me to open my mind, to get the one asset that 1/2 people says is the only thing in the world worth anything...
If you are a truthseeker and wish to cure your severe case of confirmation bias, go to www.fofoa.blogspot.com where you'll learn about the reasons why we need some sort of fixture (gold or whatever it may be) in order to value goods in relation to one another so that we may TRADE -- a fundamental human activity. If fiat currencies could remain stable, they would suffice, but the most basic economic principles, supply and demand, dictate that they cannot remain even relatively stable over the long term when their supply is expanding. Gold cannot be inflated at will . . .
What's wrong with your brain?!
We already have a fixture for TRADE, it's called the USD.
That's why the USD is strong, while gold was decoupled from USD years ago.
Why does the asset used for "trade" have to "not be inflated at will" in the first place?
Our capacity to produce grows, so why shouldn't the medium of exchange we use to trade the goods that we produce? Because you say so?
While we're talking about supply and demand, why would you want to use something with a LIMITED supply to trade for goods that are not limited?
You could trade cheerios if cheerios were the accepted form of exchange.
But I know, I know... gold is the only thing in the world with any value, perceived or otherwise, and that's why we all have to hold gold - because the world will end tomorrow and we will all need gold and canned spam and arable land with seeds...
"While we're talking about supply and demand, why would you want to use something with a LIMITED supply to trade for goods that are not limited?"
I'm glad you asked. When the supply of our "money" can be increased artificially, the purchasing power of that "money" can therefore be decreased artificially. Monetary inflation is theft. If the money supply is doubled relative to the goods/services that money could buy, simple supply/demand rules of 101 economics would dictate that the monetary unit's purchasing power would eventually fall by half -- i.e. that ben franklin in your wallet buys less copper, gold, oil, prostitutional services (in your case) than it did before.
i.e., you're now a "Master Bater"
Masterbation - trading wealth for paper
Also, while we're talking about trade and exchange... so what if a currency was backed with gold? What would that change? If the price of gold goes up or down, it still manipulates the currency.
"You cannot print gold". That's your next argument right?
But you can print newspapers, and those are bought with gold in your situation.
So should we stop producing altogether because there is less gold to buy items with? What about when all the gold runs out? Should we stop producing then?
You spelled masturbation wrong, while we're attacking each others grammar...
My wife likes to keep me ignorant on the subject.
Dude logical fallacies galore.
A) Comparing fiat currency to trading a news paper for a hard asset is asanine.
B) The second question doesn't even make sense. Are you trying to say that we would experience deflation with gold? If you were deflation is good for people who save. You know the basis for all investment and possible future economic growth.
C) Gold doesn't depreciate because its nearly indestructable, it is why it is a store of wealth and matches or candles aren't. It doesn't get "used up" like everything esle does, it is non-reactive.
People Selling at these right?
Where was the mass stamped into buying?
Oh, right, Hasn't happened yet.
Yet you facts straight man.
Cash 4 Gold, and Pawnshops are Buying, the Sheelple are SELLING.
Are people clamoring over each other to get the last 1 ounce Maple? (No)
Come on man, at lest use SOME logic.
Paulson has trouble convincing people to join his fund because there is no "bubble".
So you're saying that pawn shops and payday loan places buying gold and gold commercials on tv don't qualify as "everybody getting in on the fad"?
No, they don't. Its when those people that are now selling for a few bucks start buying and forming lines out the coin shop to buy silver eagles to keep and own. That's when its a top - just like in late 79 and early 80. It will also have a blowoff crescendo that hasnt happened yet.
Wait, if pawn shops and payday loan places and tee vee commercials are all buying gold, doesn't that mean the unwashed masses are, you know, *selling* all their gold? The buyers are those who realize 'it really is different this time' and the sellers are precisely the people you would need participating to make this a bubble. It's when the unwashed are *buying* anything en masse (and doing so not based on any real understanding but because Joe next door is doing it and they want in too) that you get the kind of bubbles you referred to.
And while I disagree with you, you did drop a nice SP reference earlier, so hat tip from me.
Edit: And 'Gold...Bitches' said it more succinctly and first...I need to read through all the responses before I post.
do you have any idea how much it costs to mine and refine an oz of silver? the mint is sold out. they sold more in december, than the whole prior year, and that was at a high premium.there isn't enough silver, for every person on earth, to have 1 oz. the market, the whole silver market, is smaller than wal-mart. the available physical supply, could disappear, in less than a week. I don't care what someone says it is worth, it's real, its pure,and it has monetary, jewelry, and industrial uses.FRN note, costs 2 cents to print, any denomination, all you want. silver production has lagged use, since 1945. WAKE UP millions of people believing something, does not make it true
If production has lagged use for 65 years, you wouldn't be able to get any EVER, because the people "using it" would be on waiting lists, etc.
It's sold out for a couple of months because of unusual speculation. That's even more evidence that it's the "new fad" like housing or oil.
in 1945 there was 20 times more silver than gold above ground, now theres 20 times more gold than silver. yes, we are getting to the place, where you will have to get on a list to buy physical, kinda like a lot of mints, right now. they sell silver, they don't have yet.
Silver i have is my bank. Its paid for. Its scarce and harder to get. Someday it may be worth a lot, maybe not, am keeping it just the same. At a thousand per oz i may reconsider. I can wait.
Its not like you can PRINT more of it. Paper gold and paper silver is like paper money and my bad checks HAha. LOL am really enjoying this. Frankly, with todays economy i dont give a damn charlotte !!
mb a the price of gold is nowwhere at those levels and will go higher to balance the books of the fiat printing .
gold is your life line to asset protection,
it is the backing for a nations ability to trade in the future ..
does a person listen to jim sinclair or your mindless anal misunderstanding of austrian economics ,, and the nature of gold ,
you are clueless my friend ,, and do a disservice to your self ,, and those who understand the role of gold . look at your statementS AS a fools errand ,,each time you open your mouth about gold ,, the tongue flaps the brains
bouncearound like some know nothing guy in a costume of dumb ..
get up to date on the real reason for gold . in international commerce.. and a balance to the nature of the fiat masters. gold is going up ,, and 1650 is the next target..
as the fiat loses its luster,, and the race to the bottom begains in the devaluation of paper .. count on it.
Yeah yeah. You have your opinion, and I have mine.
I didn't call you dumb and spout off a bunch of jibberish and stuff I heard on a commercial though.
Did it ever occur to you that more currency can be printed and gold could already have that priced in because of rampant speculation?
Of course not. When everybody is trying to get something, it's only natural that it's fair value, isn't it?
Like houses being more than people could afford. Houses weren't worth that much, oil wasn't worth that much, and gold isn't going to 1650. If it does, it'll only be for a short time.
However, there's more of an interest in shaking out the weak hands than there is making them money by allowing the price to appreciate consistently.
Whenever I hear somebody tell me things like "get up to date" I know that the bubble is on.
But of course... it's "different" this time, isn't it?
You can insult me if you want, so with that said, I hope that you buy a ton of gold, right now. If you don't listen to reason and spout talking points from a gold commercial, I've done all that I can do. A fool and his money are often separated...
a very simple argument to tell if its in a bubble or not is to look at the level of exploration, or not, in the area. When oil was over 100, there was increases of exploration budgets by oil co's to find more oil - because the cost of finding and getting out was less then current prices they could sell it at. Gold co's have not increased materially the amount of exploration budgets. Thus, not in a bubble. Gold Co CEO's have stated a stable $1,500/oz price needed to sustain the process from beginning to end if funding themselves out of cash flows from operations to explore, drill, develop, commission the mine and then finally start mining.
$$ is flocking to Juniors for exploration and mine developement.
http://www.mineweb.net/mineweb/view/mineweb/en/page67?oid=94111&sn=Detail
Im not talking about juniors or explorers raising money. Im talking about ABX, KCG, AU, et al, funding new exploration as opposed to buying mines or companies that were the explorer or developer. Funding it through operational cash flow of the existent business and mining operations, not from raising funds from the market as they are currently not making money as all they have are staked claims to explore, or some property that may be developed into a mine.
Not talking about explorers raising money. Im talking about ABX, KCG, AU et al, funding exploration and development from their own operations to rebuild reserves as opposed to acquiring those explorers that found something.
Dear fellow Mr Bates
Gold, Silver and much more are all scarce resources.
Many want these resources.
Demand + scarcity=
Gee thats so hard to figure, will you help me?
I am looking for the paper price of Gold to become IRRELEVANT soon as physical bullion price WILL decouple from the paper price. Get out right now out of any paper Gold (GLD, futures, etc.) including mining shares and JUST BUY PHYSICAL. The LBMA has already defaulted - it's just a matter of time before the paper Gold market blows up completely.
GET OUT OF PAPER GOLD. NOW.
SCREW THE CME CRIMEX AND BUY PHYSICAL. Nothing - NOTHING - in this entire world scares them more than the prospect of people buying physical Gold.
Yes, it is much better to buy an illiquid asset in a bubble than a more liquid one in a bubble.
Gordon is right. Gold bitchez, etc.
I am not sure you even understand what "illiquid" means.
GG, well stated. +10
It means try to get some cash for your gold coins today, at market value.
Paper gold... click click... there's a bidder... nice, sold.
Most people don't even have 500 bucks in the bank. (No, really...)
How are you going to sell all kinds of physical gold to people that aren't working in a crashed economy?
There are many people overseas with money ... and your jobs have been shipped to them :) US citizens aren't the only buyer of gold... sorry dude. Physical only.
Okay, well you ship them your gold when the "world ends" and we don't have a postal service.
Even if we did have a postal service, what are you going to do - ship them your gold first? Maybe they should ship you their money first?
It's so funny how the people on here are disconnected. They save gold for the "inevitable black swan that will end the world", yet they expect to exchange their gold as easily as they can today at that time.
Oh wait, maybe you can SWIM overseas to exchange it? Shit, there's something I forgot about.
Geez, Mister didnt you go to school and learn history? Silver and gold is and has been the ONLY money for centuries.
Think actecs, think of any empire, silver and gold are and have always been held in high esteem as a store of ..........
I hope you get the sublety of your status
In a crashed economy, I'll be spending my gold, not selling it.
hahahahhahhaha. well put.
Hahaha... spending it where and how? At the grocery store? Or are you going to trade a one ounce gold coin for a hamburger?
By the way, I saw your other post. I would LOVE to meet you in a dark alley anytime, really.
They certainly won't take us dollars.
Means it can't be melted, perhaps because it is mostly tungsten...
a liquid asset is one that can be sold in a very short period of time from wanting to sell and completing the transaction (stock market with electronic trading/orders). A house is illiquid because it can take months for it to finish from the beginning.
Gold is, has been, and always will be, an extremely liquid asset.
MB, hope you learn this well.
And where are you going to get money for a large lot of gold in a short amount of time?
Maybe people who will buy gold to resell, but they won't give you full value because they're resellers.
And where are you going to get money for a large lot of gold in a short amount of time?
I can understand that you dont like gold and think its in a bubble. However, you dismiss thousands of years of history of gold being money while placing 100% belief in the fiat system as if after being in existence for less than 40 years is the defacto standard for the rest of time going forward.
Gold owners dont hurry!
do you spend all your money, at one time? the world isn't going to end, its just going to change, for the worse, and paper currency, will lose the confidence, of the people, as they see it's purchasing power erode, and they know that money printing, is the cause. FRNs are a perceived value, backed by a political promise. do you want your wealth secured, by the promise, of a politician? gold is what it is, paper, is what they say it is
you dont own gold unless its in your hand lol
and for the benefit of the zit faced young uns ,, who have been raised on keynesian mush ... .
right on G.G. the paper price on some contracts .. are being offered 25% over market to take paper and not gold .. as the supply is being taken off the market .
but i doubt many can even spring for a 1100 dollar gold price . // as the surveys taken show that a majority of the american public can not come up with 2000 bucks in an emergency.
And for our "oldun's" who ruined the country in the first place, and sold out our jobs to Mexico and ran deficits from the time I was born, who get their news from Glenn Beck... *flips the bird.*
Don't you love it when the people that ruined the fucking country get all uppity on young people like they know everything? Yeah... way to spend us broke and leave nothing for your children!
So talk bad about the young people all you want, because your generation has been mortgaging our future since we were born.
With that said... I agree. Gold is illiquid because the majority of Americans can't even get 2000 bucks. In actuality, I heard a stat that close to 40% of Americans under 40 or something had less than 500 bucks in the bank.
So how are people with ten ounces of bullion going to get cash for it quickly, and at market value?
Wayne, you are just being annoying now.
STFU, will you?
+1 junior has daddy issues
I have transported 3 oz Gold out of USA and converted to foreign cash at a premium over spot price. I have converted 10 oz of Gold to Gold Jewelery for my siblings.
In USA I have asked at my local "cash4Cold" dealer and he said he will pay me above spot, but I have so far not tried.
Could not agree more about the old folks who sold us out and now want us to pay for their high living. They deserve the mess they caused us to wade through.
Also agree that you would be hard pressed to find an average American who could scrape together the money for an ounce of gold. However I will point out that just because Americans are broke as a joke doesn't mean the world is. And yes I know it's not like we are going to mail our gold overseas we can however try to get overseas with our gold and sell to people who might be interested in buying if our leadership continues to sell our asses down the river.
I know this guy is looking at leaving this rotting corpse, money and gold in hand. Because we both know the Boomers will sell us into slavery if that's what it takes to make sure they get their SS and Medicare, to say nothing of the vampire bankers at our neck. Are you planning on riding it out here?
This old fart is no rich financeer. Many of us old ones had no part in this looting and in fact feel as ripped off as you. 59, worked all my life to see my house value plummet and come to see wont be no SSI for me, tho i paid into it. Life aint fair, place blame where it belongs!
I think it is the fact that my generation feels cheated because they expect older people, like their parents or grand parents to have done something. Most of us just don't want to admit that we have to stop blaming other people for the problems that exist because others didn't fix them and just fix it ourselves.
Well we were cheated, and yeah we can't sit around waiting for them to fix the problems because they won't, they can't. But I happen to be in the camp that believes the problems cannot be fixed in the structure we have. Hope I'm wrong, but how do we pull the vampire off us, get back to growth in a world of shrinking resources and pay our debts and 100 trillion in promises we made but did not budget for? I don't think we the ship from going down. It's go down with the ship or take a life raft somewhere else.
Yah but we can certianly help the ship go down faster by just trying to trade our PM's for the crap we really want. I have been kind of lazy about this I need to start trying to barter with shops I go to for some of my silver. The only problem I have is I don't want to let it go because silver is so under priced :(.
I don't hold you personally responsible. However this happened on your watch. You had a life, living in a great country, our lives are just beginning. We will not have a life as good as the one you had. You may be screwed now but me and people like me are screwed as kids. And tell me in all honesty don't you expect your gen to try to squeeze mine to make sure you get those bennies you were promised? We won't have reform to our ponzi system because you guys know it's a ponzi but now it's your turn to get paid. Medicare + SS + Medicaid = 100 trillion in unfunded liabilities.
Don't take this as me bashing old people. I happen to get along great with old folks and I understand you guys are screwed too. But this final meltdown happened on your watch. I saw it coming and I'm just some stupid kid, you old timers should have known better.
EDIT: For Clarification. My dad is about your age and I know he's scared now, but he wasn't scared a few years ago when I was. I worked in a construction related area so I did see this coming. I knew it would happen when I was priced out of home ownership "Hmmm I will about double my income when I graduate, and be decently above median income, and I'll never afford a house..." Now i didn't know jack about derivatives so I thought it would be like the tech crash and the Fed would pump us out of it, but again young and stupid.
Now I understand that you were just a kid when LBJ cut our jugular, and we have been bleeding out ever since, and I can't blame your gen for that. But you guys didn't make much of a fuss as we got our industry sent overseas or W decided to ram through a pile of wars and Constitution destroying legislation. You guys knew that this system was not maintainable and here we are. What should us youngsters do? I'm not going to launch a campaign against the boomers but I don't feel like being forced to bleed for you when you didn't fight for yourselves or your children. And again I say this to your generation not to you. For all I know you could have been fighting this system for years, I don't know. I hope you were.
- Bravo.
I'm Gen X and I couldn't have said it any better....
This house of cards is destined to collapse because there are already too many people (the evil sort known as "speculators") who are blowing prety damn hard, and there are others who are starting to realize that you can't re-stack the cards fast enough to keep the house intact.
Knowing where this futile exercise ends is very chilling for those of us who understand how catastrophic the destruction is when a well-oiled machine is suddenly forced to run without adequate lubrication.
GG,
I'm with you on GLD, but I lost you on Miners...
Miners.....A Big X.