This page has been archived and commenting is disabled.
When JPM/HSBC Don't Like The Results, The CME Just Changes The Rules: Full Revised Silver Margin Schedule
Here is how the CME just changed the rules just as the Fed was losing the game. Full new margin schedule attached.
»
- 28532 reads
- Printer-friendly version
- Send to friend
- advertisements -
i thought the manipulators didn't have margin requirements
Doesnt matter what the PM's do or why. Softs, metals, industrials all going to the moon courtesy of Burnin' Ben.
http://www.bloomberg.com/markets/commodities/futures/
OUCH!
General Jim update:
There are now 47 trading days left until January 14, 2011.
Gold now has to rise by $5.53 a day, every trading day in order to reach this target.
Otherwise, General Jim will be history....
Discarded by the investment community as a kook like Martin Armstrong.
He should have sandbagged his target at something like $1,300 instead.
That's right, he should have bought something with intrinsic value...like PCLN?
Considering gold is largely on the rise, I find your attention to Gold... well, suspicious. And your act is rather transparent.
You post charts every time when there's even a minor move downwards, completely ignoring the price development since your previous post, which has generally been vertical upwards.
You're like a watered down version of Nadler.
"I'll have a Nadler Sour, with an extra shot of Jeffrey Christian and a splash of Jim Cramer."
"General Jim"? No, it's Lord Jim. Marty a kook? At your peril. Go buy some more Logitech and crack open a Victoria's Secret catalogue. We'll take care of the heavy lifting in your absence.
What a fucking douchebag you are, Robo.
Gold rallies $250 over 3 months and you say nothing. No cute little charts, stolen and photoshopped from JSM. Gold goes down a few dollars and here comes your silly Sinclair references again.
You're a dope and a pervert. Stick to the soft-core porn postings. You obviously know a few things about hot chicks but very little about gold and silver.
+1390 swirlies in a Mexican bus station toilet for RoboShithead.
Robo,
You're getting too obvious.
You need to come out with your backhand slaps to Gold and Gentleman Jim on up days as well as down.
Hell, even Johnny Bravo had the guts to be open and honest. Well, open anyway.
This Robo crap is embarrassing.
OR rise $259.91 over three, & take the other 44 off...
Obvious troll is obvious.
You sound desperate robo. Watching PMs rise without you really stings the ego eh?
Go all in short so you can quickly get back to the career path you are more suited for, sucking dick behind the local seven eleven for nickels.
Speaking of kooks...
See yourself getting lost anytime soon?
Smells like their weakness is increasing. We're getting somewhere here. I mean... targeting silver alone? Only people who panick do things like that. If a physical squeeze would really occur, the CME would have to explain to the press why they have tolerated these shenanigans for years. I've taken profits on the first leg down. Will be back soon. They have everything against them: troubles in Europe are rising and many will keep buying dips.
blood IS in the pirhana infested water.....the feeding frenzy has begun and and we ALL know the outcome.....only the stripped lifeless skeletons of JPM and HSBC will remain......the anglo bankers will be denutted and referred to in past tense only..........
now, can you please pass me the frickin popcorn....this is the best part of the movie!
This is long term BULLISH, isn't it?
I was actually shocked by this. As Yogi Berra might very well have said: when things becomes this obvious, it's clear what's going on. Now even the CME itself is afraid of having to explain the mismatch between tangible and paper commodity markets to the world. If you have physical silver, keep it. If you're trading, get ready to pile in again soon.
It was a pretty weak smack. Unless they knock it down 30% I won't even buy the dip.
.
Seriously what idiot buys this shit on margin -??? It is $28 dollars, repeat $28.00!!!! an ounce and LIQUID. There are even large dealers who will hold your physical until you decide to sell if trading is the game . The only way to trade Silver is physical otherwise your ass will be handed to you. Again $28.00 fucking dollars , thats only 14 loaves of bread , 1 case of good beer , a decent bottle of wine , a night at the movies , a happy ending , a hard cover book , seriously, this shit is way under priced at $28.00 and I could care less what the FED or the CME does because Silver has had its ass kicked deliberately for the last 50 years and karma is a bitch .The real question is what percentage of contracts are going to go physical at exp ? And who in their right mind wouldn't walk away with the physical at $28.00/ounce???? Silver is still the best bargain out there .
The standard contract is 5,000 troy ounces. That's why.
My point was you could just as easily trade the physical and it just doesn't hurt as much. It is attractive to control 140k with $6500 or $5000 unless you bought at 29.38 today . Unless you have a shitload of cash to lose (I don't) the risk isn't worth the reward . I am a die-hard silver bull and I believe the price will probably double over the course of 12 months but those limit down corrections would kill me on margin . That shit happened fast today and if I used that $5000 to buy 170 ounces today at 29.38 I would be down $574.00 not $11,900 if my math is right . I know it can go the other way but the losses are too big on down days . Physical is relatively painless but rewarding from my point of view .
I agree that everyone should own some physical but the profits (yes, in FRNs or other currencies) obtained from trading on margin can be huge if you know when to take profits and wait for the appropriate entry points.
I am not that savy . I luckily got in this trade way too early on so I am not complaining about prices today . It is others people money now that I hold .
Gold bulls are always on 100% margin.
That's why you always see these horrific, sudden price drops.
The CIGA and GATA boys are all trying to get rich quick to catch up with the PigMen, who have been rubbing their noses in the dirt for years.
Right, and water is dry, the sky is purple polka dot, and you fall up.
Hardly anyone who owns gold is on margin. Same for silver. If that were the case, we would have been down 30% today. Instead, we're only down, what, 8% from the peak?
Must be hard to see with all that hobo "liquidity" in your eyes.
Robot you idiot, one more dumb comment like that and you're fired!
The CIGA and GATA boys are all trying to get rich quick?
I know nobody owning, buying or talking about PMs at all apart from this site and sites like it.
Robo, Robo, Robo,
Has domeone hijacked your account?
Have the aliens replaced your brain?
I miss the old top-ticker Robo.
I'm really sorry if your desk is behind, I "feel your pain."
Please come back to us Robo!
Margin is a function of underlying volatility.... Not everything is some grand conspiracy. Sometimes this site goes to far.
Thanks for injecting some sanity. Dispassionate attention to the market will get you better returns than sentimentality folks.
Sir,
Too far??? True enough there's a ZH bias toward free markets and against regulated control (both presumingly within the law), BUT...
1. Sir, Don't you think that the CME should have foreseen volume increases and prepared for this, and not triggered a change during trading without announcement? Thus directly manipulating the price? Please excuse my ignorance if I don't understand the normal mechanism for triggering an event for a margin increase or this kind.
2. Sir, Why didn't they put this in place before of after hours -- I know ... because the volume soared and that triggered their action, right?
3. Sir, Because they changed the rules during one of the largest rises in the Ag metal in history, don't you believe they knew that the price would be suppressed instantaneously? Perhaps they could have done this differently, perhaps by announcing intent to raise margin calls based on volume (for the next day). Perhaps that is not how it works, and I need to be schooled.
4. Sir, What precedence in other commodities that have recently soared in the past year: Wheat, Sugar, Copper etc... can we refer to as examples of the same action. I really don't know - I am sincerely asking. Can we list some?
5. Sir, Certainly you will agree that there is enough empirical data to show that the enforcement division of COMEX stood by and watched as HSBC and JPM manipulated short positions (what I understand to be the largest concentrated shorts in history for any commodity, BAR NONE) and NO ACTION was taken.
6.How many people were entering the market in hundreds of related equities, physical purchases, etc. during the increase. What negative impact did this have on those buyers or sellers, when an unexpected event triggering a waterfall sell off happened?
7.Did you see the clip of black helicopters flying over Jason Hommel's house during the run up? ;)
Sincerely... Call me misinformed or a conspiracy nut, but to shrug it off so easily seems irresponsible toward the basic ideas of a free market. Have I gone too far?
Sir...
Have a look at the Cotton market. It has gone limit up for 8 straight sessions. The Ice has raised margin 9 times the past 2 months yet that has done nothing to curtail the rally. What say you??
Silver recovering all of today's losses and then some, is well within the Cone of Uncertainty.
I was a margin guy for a while....this is all very normal, and when you see volatility like this the marginalways goes up. Silver has a long standing track record of killing stupid traders.
Something else out there rattled the cages
This is why I don’t get involved in the paper futures markets. The big players control them and they can do almost anything to manipulate them in their favor. God help you if you’re the one getting squeezed by them.
Next thing you know the exchanges will be accepting silver certificates in lieu of real bullion which Bernanke will be printing by re-stamping worthless greenbacks.
Who ultimately makes the decision to raise the margin requirement?
It accomplishes nothing other than perhaps help JPM cover a few shorts but long term, more physical gets sold at lower prices, i.e. more silver sold for same $, which puts more pressure on supply.
These speed bumps don't shake physical from people so the effect is a quicker drying up of physical due to lower prices.
CFTC commissioner ‘disappointed’ with CME Group
By Hal Weitzman in Chicago
Published: November 3 2010 15:16 | Last updated: November 3 2010 18:14
A top Washington regulator has launched a scathing attack on the CME Group, the US’s biggest futures exchange, for refusing to co-operate in the introduction of position limits in futures markets.
Bart Chilton, one of the five commissioners of the Commodity Futures Trading Commission (CFTC), the US futures watchdog, told the FT he had been left “frustrated and disappointed” by a meeting with the CME in Chicago on Tuesday ahead of the Futures Industry Association Expo, the industry’s annual jamboree.
Under the Dodd-Frank billl on financial regulatory reform, mandatory position limits are due to be introduced in energy and metals markets by mid-January and on agricultural commodities by mid-April.
However, Mr Chilton said the CME was apparently hiding behind wording in the legislation that said such limits should be introduced “as necessary”. The CFTC commissioner said he suspected the exchange group was hoping to use the language to avoid implementing mandatory position limits.
He complained that the CME had “refused to engage in a dialogue” with him over the issue.
“I had hoped to gain some sense of how we should thoughtfully implement the mandatory position. Their position, however, is that there isn’t a need for additional limits and that the law doesn’t require that they even be implemented,” Mr Chilton said.
“I think that would be news to the folks who wrote the law,” the CFTC commissioner said. “For me, it is very clear what we are required to do. Taking a pass on implementing position limits is a major non-starter. Congress passed the new law, it was signed by the President and we have to implement limits - full stop.”
Mr Chilton said that by contrast, Intercontinental Exchange, the US’s second-biggest futures exchange, had been “very helpful and thoughtful” about the issue.
The CME filed a comment with the CFTC last week in which it argued urged for a delay in the imposition of position limits until the CFTC collected more data to enable it to determine and police limits.
Noting that the Dodd-Frank Act allows the CFTC to make broad exemptions to the new rules, the CME also urged the regulator “to accommodate all non-speculative positions”.
A CME spokesman said the language of the legislation “might be up for interpretation”.
Mr Chilton has proposed extending position limits to financial futures and to high-frequency traders, but he admitted that he had not worked out the details of how such a proposal might function in practice.
Copyright The Financial Times Limited 2010. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.
I remember a few years ago and they raised margins on Wheat...I was like "Ok, that's the end of that"....only to see Wheat go up another 5 bux/bu. from 8 to 13....this is a token gesture. I work at the CBOT/Grains, and BTW, we don't like the Merc Jerks either!
This is only a speed bump on the road to $50.
I'm really worried about the price of silver right now. I think they just popped the "bubble".
I haven't seen the price of silver this low in nearly two days! Clearly, the panic is on.
/sarcasm
Sprott just took a good 6MM ounces off the market. I have no idea how he found that much at once. This is all a sideshow, something to keep us entertained until the main event starts. I, for one, am going long popcorn futures waiting to see what unfold for the December deliveries.
And lastly, let's see what the price of PM's do next week when 11-digit POMOs start up.
Would everyone please stop using "MM"? It's spelled Million, not MMillion. Eff the Europeans and their gay acronym preferences.
TD hit it in the question of 'What's next...". This decision did not happen over night and I'm sure they've got the next step already drawn up should PM's continue to climb...the question is, 'What is it?'
These are some scary MoFo's in that they can try to change the game rules to their advantage whenever they want. A blatant show of who's in charge...kind of a funny coincidence on a day missile fires off US shores.
Sorry to post such a naive question but why would this have more impact on bulls ? As far as I know the maintenance margin has to be paid irrespective of the long / short aspect of the position ?!
This move is clearly showing the COMEX is short of Bullion and a crank up in price of late isnt helping matters also these law suits over Silver price manipulation is clearly putting pressure to reduce these large shorts, Since no central banks have no silver reserves all this fraud is difficult to hide so move the goalpost,
The price can be manipulated for a longtime but oneday it will fing its true value which is at least $50 and in my view much higher so any fallout shoud be exploited to increase longs and anyone with longs in place dont worry it will find its true value oneday
This goalpost movement is a clear signal things are very bad and physical ownership looks very compeling and this may be a last time silver is so cheap after things settle down.
I did not believe any of the manipulation bulls**t until today. That's exactly what this was. They did not want to see $30 before QEII even starts.
Yet another 'strange coincidence' in the silver market.
Maybe Eric King and KWN will have to fold up shop after today.
No other sector gets blowtorched by 20% in one day, top to bottom.
LOL....
Maybe we at Kitco will have to shut down soon too, LOL , as soon as gold doesn't go to 1650 by January, Oh my, am terrified of the thought, I will be Sinclair's bitch for life, right Robot!
Gotta call bullshit on this one, Robo. Hey, I like hearing perspectives from all sides and won't ever criticize you for your opinion on PMs, but to point to GSS's 18% drop as evidence for your anti-PM meme is disingenuous. The reason: it was dropping when virtually all other PM stocks we're way up because it had just reported a Q3 loss. Big FAIL here dude! Makes me dis your other prognostications.
What prognostications...the guy is a joke...he pulls out stocks that either are blasted higher or smoked lower than acts like he was "in the know" all along.
a couple weeks ago i didn't understand the point you were making about robo but i get it now
+1
Another commentator predicted exactly this reaction earlier. No guts robo.
What is your infatuation with KWN...do you have a crush on Eric King and he told you to take a hike...gold bull or bear I would rather listen to his interviews than see your crap posted.
I think I'm just going to start autojunking you without bothering to read your comments. They're not really worth my time anyway.
Join the club --- and it's growing larger all the time.
Robotdickweed is a complete joke and waste of space. And that includes his purile soft porn postings.
+++
Yes, Robo, its called the commodity futures market and it takes balls the size of New Hampshire to make a living trading it. Which is why I have the utmost respect for Jim Sinclair yet zero respect for stock-pumping shills such as yourself.
How you ever achieved "contributor" status here is beyond me.
Unfortunately, silver is undergoing physical demand, not paper demand. All this did was shine a spotlight on it and make sure it gets drained faster by putting it on sale. The CME only made the situation worse. 50 by the end of next week after this stunt would not surprise me in the least.
Don't margin requirements affect longs and shorts?
Margin changes are normal and expected as price of the underlying rises. It happens in every market. This is not manipulation. Go back and look at the history of margin requirements for SPOO's or crude.
Manipulation will be evident if and when they do a "Henry Jarecki" like in 1980 (a little history lesson for the wet behind the ears crowd).
Two other points: the incredible rise in silver over the last week or so clearly benefited from the low margin. It wasn't just physical purchases that pushed it up. If you are a physical only buyer, and you really want to own PM's, it should not make a lick of difference to you. Just accept that some of your recent gain was a result of others' margin buying. You loved it when they were buying, and get angry when they sell.
Second point: go back and read the ZH articles regarding the PM's over the last week or so. Lots of froth in the comments section. Reminded me of the Dow 36000 crowd. When sentiment gets so one sided, this sort of move cannot be unexpected. Go back and read the comments in the press when oil hit $147. That's another finite commodity, albeit with an important underlying use that actually lessens the supply, because using it destroys it. "Oil to be $200 by end of the year (2009)". Didn't quite happen, and from $147 it saw $37 before it (never) saw $150. The world can live without gold; the world cannot support 7 billion people without oil. Still, oil tumbled 75% in no time at all.
For many, PM's have become a religion. That's fine. Just remember that for some people it is just a trade, and thus they will behave accordingly, driving prices this way and that. Anyone who really likes PM's and insists on owning them, can---rather than beef about "manipulation"---use any plunge to load up.
Your religion may prove to be the only true one. Or not. You don't know, I don't know, nobody knows.
Tyler,
You are just being silly. of course the margins should be raised. Hell they should be raised the 3X what they are. If we do not, we can have all sorts of default if Silver goes up or down $5 in a day.
The margin applies both ways, for shorts and longs. But give it a bullish spin as always.
reversal for SLv on 15X normal volume. fundamentals can kiss my a**. This thing is done.
Barclays and 'anonymous' were busy doing cross trades all day.
Today was the top for PMs. Sold all my silver at $29. Been long since 2000 below $4/ounce. Silver should trade down to $21.50 by next Tuesday and then onto $14.75 early 2011.
Because Obama will be impeached next week, replaced by Ron Paul, who will execute Ben Bernake publicly before setting fire to the Federal Reserve with a lighted torch, after announcing a gold or silver-backed dollar?
Execute with his bare hands? :)
While you're watching all that happen, prepare to dodge all the angels flying from my asshole at the same time.
Hey Thunder Dumbass,
Thats funny right there ... LOL
Some people still don't get it. Gold is not the bubble, it is only telling us how fucked the USD and other currencies and economies are. People looking to store wealth when the future contains too many risks.
Ironically attempts to manipulate and reregulate PMs helps consolidate prices and prevent it becoming a bubble on irrational exuberance.
And to those saying gold will have nothing to do with currencies have to aske why do CBs hold them, why have they spent decades trying to supress prices?
Gold will always be inexorably tied to currencies and economies, which is only becomes evident when things go bad.
Gold you can take through space and time and still know it will buy you something.
"Today was the top for PMs. Sold all my silver at $29. Been long since 2000 below $4/ounce."
That's interesting because Silver never went below $4 in 2000. You wouldn't lie to us now would you?
The charts are linked below in case you need your memory refreshed.
http://www.kitco.com/charts/historicalsilver.html
http://www.goldprice.org/ebay-silver-prices/
PMs will only be able 'top' when manipulators let them free. Otherwise there is always an upward pressure waiting to be released. Like squeezing a hose, the pressure will be there until you unblock it, only then will an equilibrium be found.
Hey, I have been at the beach since last Friday and I noticed silver finally got through $27. Any news driving it up?
We forgot to tell you part of the deal.
btw, it's a global market.
I am all for conspiracy theories and yes the Exchanges do Kowtow (http://en.wikipedia.org/wiki/Kowtow)to the TBTF Banksters , ironic picture in the description link, after all Goldman and JP Morgan are the largest share holders at the CME, I believe Goldman is also the single largest shareholder of the ICE Exchange,( ICE a rant for another time), the bottom line is the formula for margins is a basic function of market Volatility using the Average Daily Range of given Futures Contract. The December Silver Futures contract Average Daily Range has gone from, 40 cents =$2000 Hi to Low in Sept to todays current range 110 cents = $5500 Hi to Low. The Risk has doubled in 6 weeks if anything the CME should have doubled the margin and historically they are guilty of keeping margin too low. Higher margins = less Volume and todays Exchanges, operating as public owned business's have one mission and that is greater revenue, fair markets be damned. The end of the run in metals will not be dictated by margin accounts. When I started at the Mid America Commodity Exchange (MidAm) in late 1979, Silver was trading between $30 to $50 oz. driven by many of todays fundamentals with one big difference, the Hunt Brothers. They were THE owners of Silver and they made a critical mistake, made by numerous Plungers of yore, they bought Futures contracts and thus were not just over leveraged but the entities on the otherside of their Longs were the Members of the Comex and CBOT who got the Exchange to declare a "Market Emergency" or Force Majuer and in the "interest" of keeping an orderly and "fair" market enforced a Liquidation Only ruling in the Silver Futures markets. I happened to be marking the Silver Futures chalkboard, yes I am an antique, when the word came out and all Silver Futures instantly locked limit down and the underlying cash market broke $16 ! in less than 30 min ruining the Hunts and saving many a Member of the Exchanges. Today the owners of the Silver is broad based with China as the biggest and they own the physical metal and can not be shall I dare say "Shanghaied" by any margin call,