Margin Calls Force Start Of Gold Liquidation

Tyler Durden's picture

As expected, the massive global rout is shifting to the best performing asset: gold, which courtesy of pervasive repo desk margin calls (which are merely trying to preserve capital for their TBTF holding companies) is seeing liquidations to satisfy collateral margin requirements. It will be interesting if the only real dip worth buying will see buyers come out of the woodwork or if gold will proceed to plunge alongside everything else.

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GeneMarchbanks's picture

BTFD! Bitchez.

Good thing. I was beginning to worry that BTFD was a thing of the past.

urbanelf's picture

BTFD was down 12% MoM after they raised margin requirements on OTC BTFD trading.

caconhma's picture

My take:
- The FED and WallStreet desperately need Q3.

Consequently, fearing a hyperinflation, they are trying to "kill" commodities prices before starting with Q3.

- Finally, the FED is closing control of the economy. They are running out of ammunition.

Forward History's picture

FINALLY. Please bring silver down to below $30 for a while and gold below $1400 (I can dream). Let me back the truck up before the slow ascent upward resumes to $2k.

Buckaroo Banzai's picture

Interesting that Platinum and Palladium are taking such a beating. Palladium especially.

spiral_eyes's picture

industrial demand. the crash is coming.

narapoiddyslexia's picture

It looks like 1118.25k shares of GLD changed hands at 12:36pm for $159.91.

Is that almost $180 million? In five minutes.  

Who moves those quantities?

DavosSherman's picture

Italy has over 2,400 tonnes of gold.

What is that? Service on their debt for x years (2) at the current price of gold....

Just sayin.....

CompassionateFascist's picture

This is just a practice run for the Real Thing: this time, next year. As such, an excellent opportunity to lay in PMs and other necessities: food, water, weapons, ammunition.

Short_phlogiston's picture

just keep stacking them away...

baby_BLYTHE's picture

Benocide is a very dangerous man right now.

This deflation scare has got to have him up in the wee hours of the morning. Of course "Gold is not money" yet somehow it is surging to the moon, now only taking 6.9 ounces to buy the DJIA. What is the smart money trying to say?

The slightest hint of more money printing, let alone the actual implementation of QE3, will have devastating consequences and they will be global.

World leaders might just have finally had enough, Russia's defacto dictator has called the United States "A parasite" on the global economy that abuses it privilege as world's reserve currency. Why might he say that? Perhaps because Russia happens to be, along with the house of Saud, the largest exporter of oil (which is priced in US dollars). Putin also called the Libyan fiasco "A crusade" against a nationstate. What was Libya really about? Nothing other than controlling both China and Russia via resource exploitation, when both nations have increasing interests in that region of the world.

So what is it going to come down to? All I know is we are very close to an inflection in terms of global economic and political stability. If the dollar collapses and oil shoots above $200 a barrel, we will have riots here in the United States. Is it worth saving a few criminal banks and an out of control government, to bring this about?

MachoMan's picture

I thought the world would turn to shit if we didn't save the banks (or that's what they told me)...  I'm so confused.

wombats's picture

Remember, any gov't's first priority in times of crisis is self preservation.  Saving the TBTF banks is just part of the self preservation equation.  They will not hesitate to set aside considerations of law, morality or the interests of the country as a whole if it serves the greater purpose of self preservation and self enrichment.

Hobbleknee's picture

I thought that was SOP even when there isn't a crisis.

PaperBugsBurn's picture

Spot on!

Can I be the executioner during the revolution? Pleaasseee!

Let's burn CONgress, the white house and Wall St. Then we go after Rockufuker and Rothschild.


Topcallingtroll, you're going down!

IQ 145's picture

You're too smart to be happy as an American. Emigrate.

Alpha Monkey's picture

That one has been on my mind alot too...  Do you think they will seize gold on my way out?

Oh regional Indian's picture

Well said BB. I was writing about this, feeling all this strange energy. Post my post, come here to the Hedge and find the world is imploding!


Escapeclaws's picture

Did somebody new take over the BB persona? Complete change in tone.

baby_BLYTHE's picture

nope, still me. How has my 'tone' changed exactly?

Escapeclaws's picture

When did you suddenly learn to write more analytical prose that takes into consideration geopolitical forces? (I will grant that you have a very pretty avatar.)

paleofartus's picture

Is that really your picture?

Greater Fool's picture

Ah well. Still outperforming the S&P by a pretty wide margin today....

chet's picture

Gold's only off 1.5%.  Silver is getting hammered, as usual.

dogbreath's picture

i wonder how much paper had to trade to achieve that result.  

TaxSlave's picture

Blue light special!

alien-IQ's picture

The TBTF's are displaying a level of desperation that we rarely get a glimpse of.

It is a beautiful sight to behold.

FranSix's picture

Ross Clark says mid-August high:

Sell offs usually occur right before options expiry.

cynicalskeptic's picture

Employment numbers out as well.   Gold gets pushd down before bad news.  


MOPE - management of perspective economics.  Push Gold down when there's bad news or if its heading up - don't want people to think of it as a safe haven.....

This smack downis definitely designed to take out as many stops as possible for a big cascade.  You're seeing big volume spikes in GDXJ and GDX  and SLW volumes as well....

bet there's a lot of naked shorting going on- to be covered further down 

Pickdog's picture

Grab some popsorn this is going to get interesting.

Mr Lennon Hendrix's picture

Welcome to the Apocalypse.

Hugh G Rection's picture


Silver's falling off a fucking cliff.  Thanks assholes, might buy you a day or so.  Shake out the weak hands, who gives a fuck.  

Hearst's picture

Hold the fort!  Brace the masts!  This gail will pass.  The cocksuckers are losing control!  Gold and Silver will Shine!!

ReallySparky's picture

Yippeee, I have been waiting for a pull back.  Very Happy Girl.

Doyle Hargraves's picture

Margin call, then buy the dip, gold bugs take physical delivery and those bastards (TPTB) are even worse off then when they started the manipulation. Some tough days ahead to slog through, but our victory is in sight now.

TaxSlave's picture

Dive, dive!

Been waiting for this.  Bye-bye stack of toilet paper, hello junk silver.

EasterBunny's picture

time for a CME margin hike?


malikai's picture

I've been calling it all week. Today is the day. From here on out it's a rout.

Archimedes's picture

I wish they would sell off the REITS! They have a long way to fall. Oh well, at least that dip in Gold I was looking for is here! better for me!

cosmictrainwreck's picture

seriously! WTF with those fuckin' REITS, like forever & always?? unbelievable

campag's picture

black gold ie oil also week

do we see more EIA stock release ?

Doyle Hargraves's picture

Dow -357
Me +357 ammo

sbenard's picture

It's not just gold, either! This is a rout we haven't seen the likes of since 2008.

Quintus's picture

Thank fuck for that.  Been very hard waiting for a tradeable dip this week.

I think it's fair to say that the permashort Bullion Banks will be all over this pullback and will try their best to push gold down to at least the $1,640s and more likely $1,620 - $1600

Whether they actually can achieve that or not is another matter.  I guess it depends on what else blows up over the next few days.

jkruffin's picture

Bank of America is going to be the first TBTF that is going under, and it will be soon.....JPMorgue may not be far behind them....but BAC will fail and fast.....