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Interactive Brokers Warns Gold Margin Hike Imminent, CME Next?
The first shot was just fired in today's battle with daily record gold prices. IB always tends to be a few minutes ahead of the CME. And following last week's 22% margin hike in gold, we are confident the CME will do everything in its power to pull a "silver" on gold. Are we about to experience a barrage of margin hikes in gold? Stay tuned and find out.
Interactive Brokers bulletin board
To HKFE,HKMEX,NYMEX,NYSELIFFE traders:
Fri Aug 19 13:29:35 2011 EST
As a result of the volatile trading environment at the present
time, please be advised that Exchange margins and House margins are
likely to increase over the next couple of days. For exchange-
specific increases, please visit the respective websites. IB will
also be increasing the gold derivatives margin. Please monitor any
affected holdings closely and manage your risk accordingly.
h/t London Dude Trader
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Doesn't this increase the risk of a collapse?
this is a dip worth buying.
oh i've been waiting for this! will be waiting to click some "buy" buttons with my plastic money this weekend. thank you EE!
margin hikes, margin shmikes, they can hike margins against "speculators" all they want, but every dollar benny prints is a margin hike against people who hold dollars.
http://azizonomics.com/2011/08/10/how-high-will-gold-go/
Seems to me that the margin hikes just reek of having lost control. I smell desperation in the air. And it isn't from my buddies and me that have stacks of silver and gold. And thanks to CME for letting me add to the stacks at a lower price over the summer. I'm pretty much about as "in" as I can be, but I'll scrape together some green paper to BTFD if it comes along...
I told all my viewers to pull their accounts with IB
www.silvergoldsilver.blogspot.com
We just had a rate hike last week. The gold market seems to flipping the middlefinger salute to the report.
-139.86 (-1.27%) Real-time: 3:08PM EDT
you can sell short the DEC contract for gold on the CME right now at the market. Put a fork in it; it;s done. Absurdly overbought; it'll be goin down some.
Me too... Thanks you CME.. please raise the margins daily .. for nect 30 days.. :) :) :) ... I want to buy more Physical AU
Interesting update from Don Coxe, says gold is telling us this financial crisis is very different and he's coined the term 'The Deficient Frontier' to describe this market.
http://goldandsilverlinings.com/?p=1567
how so?
Margin hikes won't suppress the price for very long
They wanna make sure as many chinese can buy gold on the cheap before it flies to the moon.
I don't know how many hikes silver already had but it always recovers and just gives us the option to add some more at a low price.
This economic crisis will haunt us for the next 10 to 15 years, whatever happens in 1 year doesn't matter.
I think you underestimate the healing ability of an economy after a complete collapse.
Possibly you overestimate the ability of our centrally planned economy to avoid complete collapse.
Quite likely my brain misinterpreted some things...not sure I meant to say what I said. I haven't had coffee today.
What happened?
I misinterpreted the meaning of gaoptimize's 'underestimate' as 'overestimate'.
I meanth about your logistic coffee problem.
lol...had stomach illness yesterday, trying to avoid stirring things up today.
You could try snorting it.
we dont need to encourage Family to go to rehab the long way around, do we?
Vivarin -- a cup o'joe in a pill!
Pan Asian Gold Exchange (PAGE)
http://www.pagold.cn
http://www.youtube.com/watch?v=Kyh6QlElHuY&NR=1
They can hike margins to 100%. It won't stop the gold bull, only delay it.
Hiking margins has a decreasing effect. The higher the margins go, the less effect the hikes have.
Oh how quickly we forget. Don't get too cocky. Take a look back at what happened to silver when they hiked margins in May. Buy short-term puts on GLD. Use the proceeds from the pull back to buy the dip that is coming. Bulls make money, bears make money and hogs get slaughtered.
silver is a much more volatile market than gold. you won't see a massive take down like that except in the paper market. premiums will just increase.
Trying to snatch pennies with short-term GLD puts sounds a little hog-like to me, friend. Just sayin'.
yes. and margin hikes out of desperation add fuel to the fire. they have lost (the illusion of) control of the market and the market has figured it out.
Actually i would argue the more you raise margin and fail to stem the price rise the more the market sees you as the weak hand. In other words its a price suppression strategy and nothing more. Once this insanity fails whose there to provide for an orderly market flow? If you say "obviously no one" then you will understand why institutions globally are fleeing to the safety of treasuries.
Agreed. These margin hikes will have increasingly less effect. When the scramble for physical heats up and the run on the bullion banks starts, you can tinker with your margin requirements all you'd like.
It might knock off a few young and inexperienced bulls but the big old bull with iron balls will crush you.
If being chased down by buffalo, don't bother mounting a horse. Both of you will be gored tired./
You know what I like this suppression, the last thing we want to see is a Christmas tree chart of gold(like in 1980), it's good that they are dampening the rise, which also gives us more time to accumulate
We're on the same side here me thinks, they are making the metal cheaper for us to buy
Trav's right. They double tapped gold with two margin hikes last time and the gold market reacted to it like a charging rino to a BB gun. It felt it, but it came right back at a full dead on run.
That problem with using up your margin hikes is they get used up. Then what?
yup
I have been holding for a decent dip. The moves have seemed to be too parabolic, too quick. Of course, at this time I look like a complete idiot. But, it wouldn't be the first time (or the last). Oh well is all I can say if I have to pony up a little more fiat here soon.
edit: Had to go back just to complete a sentence. Man, my posts are pitiful sometimes.
you'll get your pullback... if it continues like this, im going to start worrying for real. This move has been brewing for a decade, its quite the parabola, here's the no 1 chart of the decade;
http://tinypic.com/r/4vlatv/7
Stocks rose 27x between Oct 1922 and Oct 1923 in Weimar Germany.
The gold markets laugh at your parabolas. Rules of thumb for parabolas don't apply to these types of situations. Anyone who sells is in for the regret of their lives.
They arent "my parabola's", they belong to the abstract, and the gold market does not laugh. I, on the other hand, with have a fit laughing at you when the penny drops, ye big halfwit.
I missed a GLD call by a nickel last week. Looks like I am going to get another stab at it.
Probably worth buying some near the money gld puts. Buy some dips in physical.
This to be expected, Silver and Gold are going to take turns on who is outperforming, and who is getting the hammer of God slammed down on them. Gold will get machine gunned with margin hikes. Just a good buying opurtunity. Overweight Silver at the moment, as Gold cools off, then I will simply switch back.
http://silverliberationarmy.blogspot.com/
I would have agreed a few weeks ago, but central banks are not buying gold. Their buying provides the resiliency in gold. Their last two margin hikes, used in tandem, were an abject failure.
How many hikes will it take this time to drive gold down a lousy 1.5% over two days? Three or four?
"central banks are not buying gold." Source please? I don't assert you are wrong, but how do you know you are right?
can someone post a link to where I might follow CME margin updates? I've looked on the cme group website but I'm apparently not smart enough to find it.
To scare weak holders of Gold - before it was "IMF gonna sell Gold", now it is "CME margin hike", next what is it going to be - "Uncle sam is going to confiscate your Gold" ?
The 20 year t bond is up 40% in 6 months but no margin hike. Hummm
Remember...this is a deleveraging, and gold is money. This is more evidence of leverage being squeezed out of the system. Gold is slowly (lately, rather quickly it seems) reverting to a cash market, which coincides nicely with the prefence of physical gold over paper gold. Demand for gold continues to rise, and the purchasing power of gold continues to rise; this is exactly how money should behave in a deleveraging.
Think of the vaults at COMEX etc. as a bank. There is a run on the bank. The bank is trying to make it more attractive to leave the gold in the bank. This also makes perfect sense; bank runs are common during deleveragings. When the bank runs out of money, because it has promised / lent out too much via fractional reserve lending, people will rush the banks and hang the bankers from lampposts.
Are there still any lampposts on Wall Street?
dup
Can JP Morgan actually afford the margin payments? Or don't you have to pay margin on naked shorts?
Might asked Blythe...
http://blythemasters.blogspot.com/
JPM and the other Prime Brokers live by a different set of rules. As for margin on naked shorts, yes... you have to pay. But, given that JPM does not really pay (it's all the FED), these rules are not impacting there positions. It only impacts all their counterparties.
Your margin's no good here, Ms. Masters--we'll show you to your table now...
+$42.37 per ounce
JPM:SILVER now negative for 17 days.
Suck on THAT, Blythe.
They sell the paper and pass the cost down.
I wouldn't be surprised if they actually made a gain of every margin increase.
A comment at Blythe's blog;
Ex-Dissident said... Blythe, ignore these jealous morons. You are the essence of class and wit, all mixed together in one spectacular woman. You are both admired and loved.
Jamie D. must be the only one making comments there.
Unbelievable
Still trying to understand the implications of Margin Hikes? Can someone explain?
Look back at silver price in May for the effect of margin hikes.
Gold isn't as volatile.
Holding a futures contract in the underling commodity suddenly requires more funds. If you can't get the funds a liquidation is forced.
Fuck a Futures, Kiss a Phys.
Thank you
Here it was!
http://www.zerohedge.com/article/silver-bears-are-back
And an interesting perspective on the unintended consequences of such hikes:
http://maxkeiser.com/2011/05/03/the-unintended-consequences-of-the-cmes-...
How come they only hike margins when gold goes UP?
For the same reason they never hike margins on E-Mini's regardless of volatility.
How come woman get a migraine whenever a guy feels horny as hell?
Questions we'll never be able to answer with logic.
Please. Hammer the crap out of gold. I need a better entry price.
So it is hammering gold that creates gold derivitives? I thought it only produced flat gold. Hmmmmm.........!
Who gives a shit? A margin hike is not going to stop privateers from trading gold futures. A hike might trigger an algo dump, and open up an entry point.
CME: Go ahead--make my day
Another margin hike will TOTALLY stop Chavez from repatriating Venezuela's gold.
I'm thinkin' you left off the </sarc> tag here.
Margin hikes get progressively baked in the price. They are reaching diminishing returns and are trying to keep their powder dry. They will fail.
They are failing Smiddy....they are failing. Up yours debt slave masters. Freedom is my gift from GOD!!!
options expiration next week for gold silver, probably just a coincidence
4 snaps uno ++++...winnah, winnah, chicken dinnah!
Yup!
uno,
< probably just a coincidence>
Two words....................
My Arse!!..........................
PLEASE UP THEM!!, Waiting to make a huge scoop.(along w/50 million more)
I will never get it, why they DO NOT get it.
This just makes their problems WORSE.
Let's hope they increase the Silver margins also if there's anymore room left to make a difference physical and paper.
I still want my cheap silver in october.
If its still under $100/oz in Oct., it will be cheap.
Bring it on. The sooner they flush out the weak hands the sooner real price discovery can happen.
I understand that Chavez raised his margin requirement to 100% recently . . .
+1
I hope they hammer the shit out of gold. I have been patiently waiting for a pull back to add to my positions. My patience is growing thin though.
As stated so often on ZH....go to full cash contracts and be done with the comex charade.
thats not going to help, this time is different
Comic Relief For Market Mayhem
Gold prices hit a new high of $1,877.88 this morning and all I hear on CNBC are the top callers and naysayers
http://rosenthalcapital.com/blog/2011/08/stock-market-strategy-precious-metals-outlook/
Yes Sir! The EOTWAWKI and these weasels go on as if it's business as usual.
CNBS has been calling a top since $1000. The talking heads aren't required to have ECON 101 qualifications when applying for the position. They are just told to pump away.
I don't have ECON 101 either, that's why my ECON works and I have PMs.
Wwwwwweeee!
All my Econ. is based on subterfuge and conspiracy. In a rational market, conspiracy and illegality is the only way to make money. That's why the markets will never be rational.
CME options expiry next week LOL! Can't have the bastards actually losing money on an OPEX! Some things are theirs by right, dammit!
Prolly a good time to short GLD & SLV. But, I don't do no steenkin paper!
Perfect storm created by margin hikes before Bernanke loans Fed gold to China at $1850? Bring the price down, bitchez! I need more!
Then again, and I will keep writing this, the higher the margin, the more investors will turn to physical, which will squeeze the market more than paper demand ever will.
Right again, Mr. H.
You call this a storm!...
But Lt Dan, you ain't got no legs.
Oh horror, that is going to reduce liquidity!
/irony off
Yup, here come 5 or more margin hikes. Be ready to BTFD.
Ive got a hunch margin hikes are now on faster diminishing returns just like everything else. Just dont buy gold on margin and it has no effect at all.
Hopefully someday soon these margin hikes are like any other central planning attempt at manipulating the markets and have a half life of 1-2hrs in effect.
Jezuz, it will have me glued to the screen all day long looking for my entry point. Auuugh!
I bet locating your entry point is not as difficult as youre trying to make it seem.
nice
Hahaha. You naughty dog, you.
I went to the Discovery Channel for two day during the last margin hike. It was quite soothing. When I got back, problem solved.
Just gold? And silver?
a month ago i was waiting for the EE to hammer the price down to 1500. after finally letting it go and buying some physical PMs at 1660, now i am waiting for the price to come back down to the 1700s level. shit, i should just buy regardless but the temptation to time the market is so hard to resist.
I'm feeling all that.
The dollar cost average method is probably the most effective way to invest in this environment. You won't get in at the bottom, nor will you get in at the top, but you will build a nice big buffer ove the course of the continuing bull market.
Despite all the clamorings of the trolls about how I encourage people to buy at the top (blatent lies, I encourage people to dollar cost average), my dollar cost average is below $17 for silver. It would really have to take a dive for me to lose any fiatscos. Even if it did, I have so much faith in my research, even if it went to $1 and no-one else wanted the stuff ANYWHERE, I would buy all that I could get my hands on.
Too right, Mr. M. At $1/oz. I would have to sell everything not bolted down to buy more of the pretty shiny stuff.
I might not sell everything, but I would rent my wife.
1.00?
By the time you finish entering all that payment crap and hit the enter button, the Dragon Trap is going to have you buying whatever number you put in at 100.00
All the drama of a Ebay sniping action within the last 20 seconds. The strongest computer and fastest internet wins.
even if it went to $1 and no-one else wanted the stuff ANYWHERE, I would buy all that I could get my hands on...
Looking to be the JPM of the 21st century? Or just another CB with a traditional bent? It ain't money ya know, (just the next best thing)
Someone's sucking these down like they wuz skittlez!
How about the "Chavez-effect"? Gold has not skyrocketed since.
Last night wasn't a bad start, I'd say.
Might want to refresh Kitco there, buddy.
And realize that delivery won't occur instantly.
Which begs the question: How will delivery happen? Boats sink, planes crash, trains derail, stagecoaches are rob..............gotta go. Back soon.
Who cares how delivery happens, the correct question is WHEN will delivery happen. I believe one of the documents posted yesterday states that delivery is to occur within two months. I can't wait to see how this deal plays out.
Anybody want to bet that Chavez' gold boat never sets sail, or meets with an accident on the way?
They'll do to Chavez what they did to Gadaffi and Saddam, freeze his assets.
How would the rest of the World react to that? (Hint: It's all a lose-lose situation for London, no matter how they try to wriggle off the hook!)
But even the announcement of Chavez recalling gold might have added fuel. Even stranger is that gold is lowering now while stocks are too!
Why aren't margins done on a percentage basis? This method of altering margins with price and volatility changes is not the most sensical approach.
To paraphrase: "Markets with sense is like a fish with a bicycle!"
Let them do their worst - this Dork is ready to step in with a fistful of euros in exchange for another few ounces.
The Silver Bears are humping Blythe's leg going into next week's OPEX too.
My double barrel spring loaded gold trap is set...
go ahead CME, I'll wait.
Maybe I'll snatch some silver eagles while I'm at it.
Margin hikes on PMs at this point are like trying to push back the river. Fruitless, pointless and stupid. But I guess they gotta do what they gotta do. Pretty funny, really. It's almost as amusing as it would be watching a guillotine party featuring the aristocrats (you know who you are, and we know where you are). Do you think the heads keep on thinking as they roll into the basket? You know, something like "this can't be happening to meeeeeee."
"this can't be happening to CMeeeeeeeee."
Fixed it for ya.
They (CME) can NOT Hike China's Renmibi for Gold market!!
http://www.youtube.com/watch?v=cU8VoafEb00
In this edition of On the Edge, Max Keiser interviews Ned Naylor-Leyland from Cheviot Asset Management.
He talks about the new pan Asian gold exchange and what it means for global currency and commodities markets.
http://www.thestreet.com/video/index.html?bcpid=1459183594&bclid=1137812485&bctid=596620121001#596620121001
http://www.equinix.com/company/news-and-events/articles/
NEW YORK — Electronic-stock-market operator Direct Edge announced Monday it has opened up access to seven private trading facilities, letting traders route orders directly to some of the largest U.S. "dark pool" venues. Direct Edge, which runs two U.S. stock exchanges, has forged pathways to alternative-trading systems run by Barclays, Goldman Sachs and Credit Suisse, as well as trading firms Knight Capital Group and Getco.http://www.denverpost.com/business/ci_17978278
The CME can NOT move the price of Gold but for a few hours or maybe a few days? perfect storm? a few weeks?
WAKE UP!! China is ahead of America in Quality.. if you believe that the Renminbi with its 1,200% leverage v. the United States Dollar's 120% Leverage.. (the lverage numbers are a little lite)
disclosure I own Dollars and Gold, I would not own Renminbi if someone gave it to me.
These MIs are getting less effective EVERYTIME, e.g. Last week's. Was it 22% ? How long did it last, a day??!
Remember margin hikes work both ways. In futures markets there's a short position for every long. Shorts are affected by the margin requirements just like longs.
If there are enough deeply leveraged shorts in the futures this could set off a squeeze to much higher prices.
It can work both ways.
After this week I don't see how there could be any leveraged shorts left.
However, I can imagine many "full" shorts.
Shorts = (exempt) commercial banks.
Can anybody tell me why the Euro is getting stronger against the USD, I would have thought with all the shit going down that we would benefit.
QE3 is being launched next week... :) :)
Etrade raised its vxx margin requirements to 70%. Dirty pool. They must need to force some selling and/or prevent withdrawals to boost their own reserves. Not right. I called another company and they said the least margin requirement for vxx was 30 and the highes 40 if it was a large % odf your portfolio.
Revoluzion
Promises, promises.
some day they will figure out that pulling credit out commodities pulls liquidity out of the entire system. cme has to take responsibility for pushing the stock market off the cliff
Steady now, remember the puke indicator. Only the big banks know when the bottom of the next hammering will be.
When you hear the news that GLD just gave up X amount of tons you know the bottom is in. hopefully you can call your coin dealer and lock in at the opportune moment.
Like a trying to wave off an F5 tornado with semafore flags.
+1. It'll get runover faster than a BOJ currency intervention.
Gather up the trailers and park them a few miles over yonder and watch.
Signal "B-a-n-a-n-a M-a-n" and take off.
the gld chart is WAY too extreme, just in case the paper market (gld) drives the physical down (tenporarely) it might be prudent to hedge with gld dec puts say 125-150?
Thats not what i'm talking about. I TOLD YOU SO
Look for the GLD holdings to be reduced not the ETF price!
I see what you mean but the charts paint a picture of what has already happened and the GLD chart is way overextended, my point is that to hedge the retracement that is coming one can buy very cheap OTM dec puts, sort of like insurance. nothing wrong with that, even for those holding only the physical and not a combination of physical/futures.