Inflationary Guerilla Tactics Resume As Comex, Nymex Hike Margins On Gold, Silver, Cracks, Spreads And Other Products

Tyler Durden's picture

Wonder why the smart money was rushing headlong out of gold and silver over the past few days, and especially today in the AM session? Here is your answer: in tried and true fashion the Comex just hiked margins in gold, and silver by about 6%, and threw in a few other commodities to mask things up. And unlike the last time it did it, when it could at least pretend to justify its actions with the surge in gold price, this time with the PM complex dropping, we wonder what excuse the CME will use this time. Initial and Maintenance margins were just increased in everything from 10 Tr Oz Gold Futs, Comex 100 Gold Futures, Comex Miny Gold and Silver, E-mini Gold and Silver,  Comex 5000 silver futures to Silver trade at settle. Also added were Copper, Iron Ore, propane, butane, and other nat gas. Most notably, and confirming that the administration and the money printing authorities are terrified by the surge in crude, the CME also hiked margins in various refined products and coal. The official scramble to "contain" the aftermath of Bernanke's lunacy is accelerating. We wonder when REDI, Prime Brokers and E-trade will comparable collapse purchasing margin for stock trading accounts. Of course, as with all other such superficial market interventions, the impact is shallow and is overrun in a matter of days.

And no...there was absolutely no leak this time. We promise.

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Raymond K Hassel's picture

kick that can, bitches

berlinjames02's picture

It seems the conclusion is simple.... buy phyiscal and tie that silver band PM a bit tighter around JPM's balls.

Careless Whisper's picture

jpm is a pig. an itty bitty piggy to be precise. nicki minaj dedicated a song to them;

people who are buying physical gold and silver welcome the pullback in price. it's healthy. when you have a 5, 10, or 20 year time horizon, these pullbacks aare laughable.


Bigger Dickus's picture

what the fuck is this? If that bitch is singing about a short squeeze in silver the top is in for silver.

GoinFawr's picture

But now that you're posting again we know it must be a bottom!

breezer1's picture

bigger dickus is a bottom? do you know what you're saying? this is a respectable board. well, in some circles anyway.

bigelkhorn's picture

This is amazing. I am scared right now about an economic collpase
as my house is about to foreclose. I am nearly in tears, and stressed.

My friend and I subscribe to the FFT newsletter the guy over at He predicted the stock market crash, and the US collapse ages ago, and many other things, it is spooky how accuaret he is. and what he says coming next is intresting, he is well worth a look.

Time to prepare was yesterday people!!

Hook Line and Sphincter's picture

Don't you mean,

kick that ameri-can down the road?



Azannoth's picture

I just doubled my physical gold/silver holding could have waited 2 more day but hey -5% isn't all that bad

Ironmaan's picture

They are indeed kicking the can. They are waging a war of attrition, but in the end they will be the ones to attrit. Hang on to your physical and we will be the last men (and women) standing.

Spalding_Smailes's picture

Kaboom !!! 

The pigmen piss in the face and kick shit onto the inflationist again .... 


Turd ??? Spritzer ???? Bay of swine ???? Turd .....

MsCreant's picture

You reveal much in this post. Deep down in the recesses of your soul, as portrayed by your avatar, YOU ARE A GOLD BUG AND INFLATIONISTA.

Spalding_Smailes's picture

How dare you, well I never ....

Turd Ferguson's picture

Hi, Spalding.

Imagine that, everything that had margins raise got crushed today. NO, there's no insider trading/info on the Comex. What a fucking joke that "market" is.

I've done some very interesting research and I'll be posting it later this evening to my blog. I'm extremely confident that the lows for this correction are in sight and that the next 20%+ UPleg will then begin.

My call is officially: $1600 by 6/10/11. I needed two more weeks post Memorial Day to make it accurate.

If it doesn't make it and I'm proven wrong. I'll leave ZH for good, never to be heard from again. When I'm right, will you and the rest of the AGAs leave, instead?

High Plains Drifter's picture

Where would they go?  Karl Douchinger's market ticker? 

Spalding_Smailes's picture

My brother -


Never, ever think of leaving. Some things are " bigger " than the Turd.

Commodities " will " be blowtorched and this will help Uncle Ben.

China is going to start hiking rates every other week and the " slowdown " talk will grow louder & this will be the monkey hammer that takes down most commodities ....

EscapeKey's picture

Right, so the Chinese will hike rates every other week, then that must be serious indication of inflation. And all this will happen without serious capital flight from the US, given Ben still lives in wonderland offering a "great" deal of - what - 3.4% on 10 years?

Let me just remind you that the only buyer of US Treasuries is Bernanke. Completely unsustainable.

DoctoRx's picture

2008 playbook, beta-tested previously by Japan:  crash stocks, crash commodities, call in dollar swaps from overseas etc.  Thus engineer another flight to "safety".  It works till it doesn't.  Sustainable till - who knows when?  

Spalding_Smailes's picture

No. China built a manufacturing complex that profited off our credit orgy since 1980. And now she needs to become a consumer driven economy, this will not be easy.

After the blow out in 07' she printed like a mother fucker build this, prop'd up that. And she borrowed trillions in yuan at low, low rates. The forex thingy with the dollar is hurting the PBoC & the banks. The consumption in China has been dropping for years. The EU and the USA will not be spending like we did 3-4 years ago and that manufacturing complex is built/needs full capacity. The BRIC's can't take down all the over capacity ...Mike Pettis has been talking about a this slowdown for over a year. No word of this " on the street , yet ".


..........I am often asked, especially by my Peking University students, to list what I think is the sequence of steps China will take to address its economic imbalances.  Remember that rebalancing, in the Chinese context, has a very specific definition.  It means raising the consumption share of GDP.  This is just a way of saying that consumption growth must outpace GDP growth, and over the next few years it inevitably will, if the rest of the world is unable to absorb a rising Chinese trade surplus.

But there are many ways this can happen.  The good way is by a surge in consumption growth that allows GDP growth to remain strong.  The bad way is for consumption growth to slow, and for GDP growth to slow much more rapidly.

So how will China rebalance?  Unfortunately there is no obvious answer.  I always tell my students that even if I were smart enough to know the optimal sequence, it would nonetheless be very difficult to make any reasonable prediction since the sequence is not likely to be subject to economic analysis.  This is as much or more a political issue as it is economic, for at least two reasons:

  1. The rebalancing process will cause short-term pain and perhaps a rise in unemployment.  Postponing it will make both of those problems worse when the adjustment finally takes place.   China has to choose when is the best time to begin that process, and this depends on a lot of social and political factors.  Most obviously, the 2012 succession process is a key variable.
  2. Because rebalancing mainly means increasing the household income share of national income and, with it, the household consumption share, it implicitly means redistributing income from businesses and governments to households, and exactly which businesses, governments, and households depend on which adjustment mechanism.  There are several ways to rebalance, each with different implications for social policy, making it an issue that must be determined not by economists but by political leaders.

I want especially to address this second point.  In previous pieces I have discussed four main ways of boosting the household income share of national income.  Over the rest of this entry I will try to set out the very different sets of winners and losers under each policy, and suggest how different policies and sets of policies might change the underlying economy.



Spalding_Smailes's picture

Finally any entity that is long dollars and short renminbi will lose.  The most obvious example is the PBoC, which loses greatly from revaluation.  Investors who have stockpiled significant amounts of commodities funded by renminbi borrowing will also lose.

CU1981's picture

Hey Numb nuts:


NIRP ... ever heard of it ?


Negative interest rate policy, PM's battle has been lost and the ptb are already two steps ahead of you. Get a clue.

Spalding_Smailes's picture

Hey fuck face. I'm reposting shit from 4 months ago. 

Read a book, next.


I have been talking about the bubble for months ...


"I'd say this is another very important signal that the economic soft patch we were all worried about is pretty much confined to March"
- David Seiders, Chief Economist, National Association of Home Builders

Sophist Economicus's picture

Gee wiz, Gold's high was in December - you've been calling for bubbles for 4 months, gold has been down A LITTLE for about a couple of weeks and you're getting all puffy chested?   Interesting.   

Spalding_Smailes's picture

Look at gold since oct 20th. Look at 90% of the miners over the last 3-4 weeks.


Yes I have been talking about china slowdown/commodity monkey hammer for months ....

Sophist Economicus's picture

I'm with ya on the China slowdown -- though I don't think we're in sparse company here.     Commodities are the play things of the specs in the short-run, BUT, if you have big visions for CAT, I'm assuming (a dangerous game, I know) that miners and farmers of all stripes can extract and plant profitably -- 'Godfather' Jim seems to be on that path -- else, I don't see the math behind your CAT vision

GoinFawr's picture

"Yes I have been talking about china slowdown/commodity monkey hammer for months ...."

Yes, and meanwhile gold and silver reached new highs in spite of your broken record prognostications, and now that they are undergoing a normal correction you are crying "Victory!".

Heh, wow. <golf clap>

gangland's picture

i feel privilidged to have sort of walked into a great conversation between some old skool zh fuckers....i don't care what I say...but there is a lot in your post spalding...uh.......thinking......ya the thing about it is......oh ya...hey dude... i post drunk too....lolz.....but who the fuck point is....china is going to make the same moves that germany did, we did, japan did, skorea did, iran is doing, saudi, etc etc. the infrastructure game, why do u think japanese debt to gdp is 200% duh they're ahead of us in temrs of that bad loan cycle...they gave bad loans like us on worthless ifratstructure and RE and farms, remeber when a big mac in tokyo was like 19 bucks??...the avg age of framers in japan is like 88 man....ok?

so  china is going to make and already ism aking the same mistakes.....theyre human liek the rest of us....we just all look a little different....thank fucking god....but i do still have a bit of ...tiny nanometer of fucking hope that the chinese will save us all before the aliens from the galactic council in sirius/pleadis belt have to enforece their mandate. doubt it tho.


waiting for dr ricky w her cap on or whatever her name is....



ok it never hit 130 but that makes my point. duh..

Spalding_Smailes's picture

Oh look,


Kamatzu is down 4 1/2 % on China slowdown talk.

Spalding has been pounding this drum for months ...

goldsaver's picture

what you've just said is one of the most insanely idiotic things I have ever heard. At no point in your rambling, incoherent response were you even close to anything that could be considered a rational thought. Everyone in this room is now dumber for having listened to it. I award you no points, and may God have mercy on your soul.

jwthomps's picture

Good job Spalding.  There is a ton to

know about China and Pettis is a good


Samuel Morales Jr.'s picture

Raising interests won't do much. It's the dollar peg that's the core of the problem. Same thing with Brazil. They will raise interest rates, but that would barely do anything against inflation. Same thing goes for China. Yuan props up the dollar, so if the Chinese were to allow the Yuan to float, USD will go down, and the Yuan will go up. So capital inflows will be a thing for China to be aware of, but yeah the USD is going down, therefore the Chinese will consume more of the same things Americans consume. Therefore things like commodities, or raw materials will cost more expensive for Americans, and Chinese economy will be more like a Japanese, or German economy where there is a more balanced consumerism, and export economy, and it's highly unlikely that manufacturing base will move back to the USA all of sudden in my view.

Idiot Savant's picture

That's a ballsy prediction Turd - good luck!

On another note, ZH would be boring without differing viewpoints. Spalding, Wanger, Redneck, and others, all bring opposing views that I find refreshing. I think it's a sign of ignorance to only want to be around people who think and feel the same way regarding a given subject. We all need to question our views and opinions from time to time. Jeez, I even miss Johnny Bravo occasionally.

jeff montanye's picture

absolutely true.  no one leave, even if wrong.  stay and raise the level of debate.  better if focus is on attacking arguments not authors, imo.

RockyRacoon's picture

Well now, that takes all the fun out of it, eh?

serotonindumptruck's picture

Total agreement here. Ad hominem is by far the most prevalent logical fallacy to be encountered on the interwebs, and the most disappointing.

I will admit when I am wrong, or at least wrong-headed in my opinions. There is truly no valid reason to "attack the messenger" via personal insults, especially when exchanging text-based dialogue.

I'd like to think that we can "evolve" beyond the keyboard kommando stage and exchange information with others as if we were speaking face-to-face.

ebworthen's picture

I jus' luv dem hominy grits attacks!

Dun leave dem boys all wide-eyed sayin' "Whassup!?!?"

Cain't have no feelin's ohr tought now, you might be messin' with de' man's plan.

Talk like dat der Benjamin Bernank, He De' Man!

gangland's picture

give u 3-2 1600 byjune ain't gonna happen would you take it? :D

GoinFawr's picture

Sure, but the bet is to be paid in gold no matter who wins.

nmewn's picture


"China is going to start hiking rates every other week and the " slowdown " talk will grow louder & this will be the monkey hammer that takes down most commodities..."

Your kiddin right? Trust commies with real capital?...what could possibly go wrong?

ebworthen's picture

In the "old days" perhaps.

What this round of monkeys in the FED and Wall Street don't understand is that this time is not like the last time. 

This is not 1982, this is not 1964, this is not your Father's Buick.

You can sell out every business, every job, every retiree and pensioner to prolong the old game but sooner or later the pigeons will come home to roost.

You cannot build an empire on pillars of salt. 

The old ways are dying, spectacular as the last two years of folly have been.


El Hosel's picture

   Silver trendline off the 2008 low would be down around $23. They pull this shit everytime, if silver gets to $23 it will be a normal correction... In an Abby normal world.

Kobe Beef's picture

Dear El Hosel,

Last January, Silver had a 4 week sell-off in January. Then it rallied through the spring. This year silver has sold off for the first 3 weeks in January so far. Until silver sells off longer than 4 weeks, I'll consider this a garden-variety sell-off & start bargain hunting.

Just my take. Cheers, Beef

SloSquez's picture

Stop rolling the dice with the the ultimatums Turd.  Just contribute - and BTW you do that well.

technovelist's picture

I agree with the others. Don't leave. Timing is a bitch; ask Jim Sinclair, who should know!

Arius's picture

more clashes in Bangladesh...just on BBC

d00daa's picture

Holy shit, calm down.

Think about this a little during the afterglow of your anti-PM orgasm.

Silver has already blown off considerably, and if it is indeed mostly related to front running this margin hike most of the damage is likely already done.

Futures are flat to slightly up.

But please, by all means, continue to troll away and make yourself look like a retard, lol.