Margin CUT?!?

Thu, Feb 9, 2012 - 5:09pm

About the Author

turd [at] tfmetalsreport [dot] com ()


Feb 9, 2012 - 5:11pm
Feb 9, 2012 - 5:12pm

Near Term Bull?

This and Iran Gold for Oil?...

Hmmm...bear trap?...


Feb 9, 2012 - 5:20pm


Why would they do that?

Feb 9, 2012 - 5:20pm

Now that JPM has offloaded its shorts

...there's a turn-up for the (cooked) books!

Feb 9, 2012 - 5:25pm

so what...

So what do regular traders do with this. Methinks the bear trap suggestion may be on the mark. Has the CME done anything in the past year to earn my trust?

Turd, moderators? I am wondering if simply editing my profile is sufficient to conceal any identity clues?

Feb 9, 2012 - 5:37pm

An annoying Newbie...

Can you explain why its a bear trap? Sorry - just trying to learn from the pros! I don't really understand Margin hikes v Margin Cuts.

fnord tpbeta
Feb 9, 2012 - 5:37pm

Trying to scare up a new

Trying to scare up a new batch of suckers?

Turdle GG
Feb 9, 2012 - 5:41pm

Makes sense

I predicted this here a week or so ago. Necessary in order to bring back some speculative elements (aka marks for the banksters).

Not sure that this will be short term bullish. Sure, lifting margins is negative as it forces out over-extended players. Whether such players take the bait of more leverage on offer is doubtful. How many times does such a player need to be screwed before he gives up?

Feb 9, 2012 - 5:44pm

Interesting ...

Thanks CME, but how about next week you lower it 5 more times.... :D

The Vet
Feb 9, 2012 - 5:55pm

S&P Downgrades CME Group to AA-

I wonder if this was one of the reasons for the margin reductions... On a par with the Greek Government raising interest rates to encourage buyers for their bonds...

Credit-rating agency S&P warned CME's grade could drop again due to the bankruptcy. "We could lower the rating on CME Group if legal and reputational issues take a long-term toll on its franchise and financial positions," S&P said. CME, the world's biggest futures exchange operator, served as a primary regulator of MF Global, and the brokerage was one of the top facilitators of trades in CME's futures and options markets.
S&P lowered the long-term issuer credit rating for the company to "AA-" from "AA". The agency affirmed a short-term "A-1+" rating for the company

Turdle GG
Feb 9, 2012 - 6:26pm

Santa's latest posting, updated

Santa reprinted his equation (gold price = US federal debt held by foreign investors/US official gold holdings).

As of the end of 2008, this led to a price target of $12,006 per oz.

Now that foreign investors hold more US debt, the equation is 4,660,000,000,000 / 260,272,000 or $17,904 per oz

Feb 9, 2012 - 6:27pm


You might be first this time, but this is the last first I will ever see of you. Goodbye, you immature little boy.

Feb 9, 2012 - 6:27pm

Look at the silver lease

Look at the silver lease rate!! FFS!! Front month silver lease rate is -.30% ! This means that, if you so choose, you should be able to borrow silver in size, and in fact GET PAID FOR THE PRIVILEGE OF BORROWING IT.

They are literally flooding the market with borrowed silver to keep their "hedge" requirements met as they viciously try to keep hold the $34 level. They are literally blowing their load here, loaning out all this silver (probably borrowed from SLV) because they will just have to buy it back... but it looks like their message/operation is clear: maintain the price and slow the movement to the upside. It's interesting because silver has held up so well.. I guess few hands left to sell, despite the cartel doing everything they can to manage the price on a DAILY BASIS.

Smells like an opportune time for ADMIRAL SPROTT to abritrage the hell out of this one. The lowering of the margins, particularly around these key levels speaks of how bad the CME's situation must be, in terms of revenue drop off. I mean, everyone knows Blythe's got Jeffrey Christian on speed dial, and I am sure the amount of armpit sweat she began to give off when she heard these margin drops would make even the most trained of Mortician pass out in disgust.

Check this weasel's chat on KitcoNews on May 2nd (probably was recorded a few days before..aka, right before the major takedown).. ahaha he continuously dodges the fact that there is no silver in size, by saying, there is more silver than ever... in SLV. LOL. Just no investors willing to sell at these prices! Blah blah blah... "this is capitulation buying" ...

Silver Already in a Bubble: Jeffrey Christian of CPM Group

_______ - Bernank's personal look at all the bullion prices in real time

Feb 9, 2012 - 6:33pm



2. Credit rating [MFG], i.e. need more liquidity. Basically the clearing house for paper needs more suckers.

3. The world is full of suckers... see #2.

p.s. Watch the trap.

Feb 9, 2012 - 6:33pm

I wonder how

Things would be trading this evening if margins had risen the same percentage?

Feb 9, 2012 - 6:36pm

im getting happy

Gold may break 1750. If it does I'm gonna do a little Turd dance on my Turd hat. Ya know what I mean

Feb 9, 2012 - 6:39pm

Just when it seemed really boring.... when it might get really interesting?

I recall reading Turdle GG's comment about this also.

This is a interesting development coupled with the Vets news link up above about the CME downgrade.


Pax Argentum
Feb 9, 2012 - 6:40pm

I sense a tremor in the force...

MFing Global Volume Dies Volatility Increases CME Rating Cut Silver Lease Rates Go Negative CME Cuts Margin Things that make me go hmmmm... Pax Feed the Turd.

bernard TF
Feb 9, 2012 - 6:47pm

@Turd Surely we would be below

Surely we would be below $33.50 in after hours, with a nice 3 am nuke to bring us to $32.80 ;)

Feb 9, 2012 - 6:50pm
Dr Durden
Feb 9, 2012 - 6:57pm

Sucke'm in

And bleed'm dry. Silly humans and their paper fantasies.

Turdle GG
Feb 9, 2012 - 7:00pm

Buffett's thoughts on gold

FWIW, he thinks that productive businesses will always produce a return (in whatever currency is in use at the time), whereas gold can not produce any return for its owner. That's why he likes to own productive assets.

His thoughts have some validity, but are not a reasonable argument for ignoring gold as a part of an investment portfolio. Of course, the key is what you define "a part" to be: 10%, 50%, more?

Feb 9, 2012 - 7:12pm

Well, gave up on waiting.

Well, gave up on waiting. This is a move to try to sucker more people back into trading on the exchange, likely so they can MF them again. With the slow price move, I'm guessing that won't be the case.

Feb 9, 2012 - 7:13pm

The only reason I can see to lower margins

Is if you want PM paper to run up and then crash them like all hell.

To crash them you need a deflationary event. Neither war nor Greece contagion is deflationary.

The only way to crash PM paper is to acknowledge there is no physical.

Are the ETFs all out? Not that they ever had any...

Feb 9, 2012 - 7:16pm

Bear Trap or Bull Trap?

Bear trap through margin reduction = They get to find buyers for their shorts, so can offload their naked shorts to new punters looking at this years performance to date, without having to let the price rise just yet? As I recall Turd pointed out (or another Turdite) that they'd already reduced their short position by circa 50% in the last 8 months or so.

We know how much media attention the 'Golds in a bubble that's going to pop' gets already. Another 15% rise within a month would give the media commentators the ideal opportunity to ramp up their 'calling a top' with 'Look what happened last April' , which would IMO be bound to suck in new money! OR

Bull trap = They let the brakes off a bit, complete with a bit of media ramping, so as to get the normal sheeple piling into paper, then re-short naked from a higher point, complete with margin hikes, thereby taking all the new $$$ back as per last April! The only TV news article I recall being bullish on Silver last year was about 4 days before it peaked, so that's the cue to get out!

Logic dictates that the Bear trap is the best option for them, as it's the easiest way for them to get out & switch to a long position. In addition, on the basis that most people can only see about two inches in front of their noses, higher prices made public, combined with the current economy, should lead to more people 'selling their last bits of family silver'. This was definitely the case last year in the Uk when Gold was going up, and the scrap would most likely end up in their hands, thereby increasing TPTB physical, exchanged for free paper!

Conclusion = If they start a bear trap at this point, they only get the bears who are already trading Silver, who are possibly more aware of the CME exisiting position, and margin hike history. Consequently the lowering of margins / lease rate reductions, will not achieve the likely aim of drawing in lots of new money. IMO it is far more likely therefore that they deliberately let it run up to the 37/38 point of intersection with the big descending trend line from the highs of last year, thereby achieving maximum potential for dumping their short position! Guess I'll just watch the TV =News of Silver going parabolic and due to collapse (then I'll keep buying) vs news of Silver/ Gold due to go to the moon (then I'll sell).

Feb 9, 2012 - 7:33pm

@Dr Jerome

Just a quick question on why you would fade away now,don't you think that by know they would know who and where you are if they indeed did want to know.I worry about the same thing but i figure it is probably to late now with ordering things on line and going to certain web sites.just wondering

Feb 9, 2012 - 7:37pm

say it aint so!! the JUDGE is NO MORE on FOX

it is so thick it is sick. FOX NEWS just got deleted. not one reason to watch that network anymore....

Fox Business Network Cancels Judge Andrew Napolitano's Freedom Watch

Bad news, freedom fighters! Judge Andrew Napolitano's Freedom Watch, the best damned daily libertarian news & argument show in the history of television (name a better one!), has gotten the axe from Fox Business Network. From the press release:

FOX Business Network (FBN) will debut a new primetime schedule featuring encore presentations of the channel's top post-market programs, announced Kevin Magee, Executive Vice President of the network. Starting February 20th at 8 PM/ET, viewers will find additional airings of The Willis Report (5PM & 8PM/ET), Cavuto (6PM & 9PM/ET) and Lou Dobbs Tonight (7PM & 10PM/ET). The new lineup will replace FreedomWatch with Judge Andrew Napolitano, Power & Money with David Asman and Follow the Money with Eric Bolling. [...]

Feb 9, 2012 - 7:38pm

Margin Cut

Could it be simple, like the Cartel is now long, so they might as well make money on the way up, then short the hell out of it again on the way down? Turd's been saying the COT has been shifting to more long than short. If sentiment is that it should go up, and they're in a losing battle, might as well force it to run up quickly, cap it for a double top, make some money, then start shorting it with the profits to run it all the way back down.

Feb 9, 2012 - 7:48pm

Napolitano Cancellation

All the halfway honest people get kicked off the mainstream media, I guess. I was surprised they let Lou Dobbs go to Fox Business after he was too radical for CNN, but they seem to have tamed him into a pacified version of his former self. Cenk Uygur threw a fit on MSNBC and went back to the Intarwebz with his Young Turks and Dylan Ratigan threw a fit once or twice, but still has his show. (It's all just an act, anyway, IMO. They go to Occupy to try to be cool with the protestors and everyone thinks they're just shills despite their random on-air rampages.)

Feb 9, 2012 - 7:48pm


I was going to comment earlier about the Judge.

I'm a bit concerned about what seems like a effort to suppress any harsh criticism of the Govt. and the means they have at their disposal to track "dissenters" and give them grief. I figured a person like myself has nothing to worry about because there are much larger and louder voices then mine that would have more to worry about from bigger soapboxes, like FOX

Judge Napolitano came to mind. I'm not not saying he was pressured off the air and it's probably a ratings thing to get some fresh show on there. But it makes me wonder a bit if his vocal disdain for big, intrusive Govt. didn't persuade FOX to take some heat off themselves.

Anything is possible and now the Judge is gone and off the air. What the heck is going on???

Who's next to get knocked off the airwaves or internet? Alex Jones?


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