Silver Just Called The COMEX's Bluff
derryb
Posts: 38,499 ✭✭✭✭✭
The demand for physical silver is stronger than the COMEX’s once unstoppable paper market shorts
Rock beats Paper.
"the COMEX is slowly dying because demand for physical metals is outpacing their empty vaults and their increasingly impotent paper games."
Some here have over the years stated that silver prices would not rise until the futures market was overun by physical buyers. It has finally happend. The only chance of holding down the price of all PMs traded on futures market is new regulatory requirments from the CTFC. Be forewarned of new ownership roadblocks.
As hard as our economic masters (and a few forum members with banking interests) have tried to prevent it, the "barbarious relics" are now a competitive asset class, but more importantly they are now a worldwide money asset.
When gold and silver move together, it signals the coming end of fiat money.
Comments
That article has so many inaccuracies and conspiracy theories that I just laughed. The raising of margin is also done to stop or slow down the leveraged margin buying to prevent a collapse, not force sales to drive down prices. Yes, if I was over-leveraged silver futures gambler using margin and the margin rate goes up, I either have to come up with more cash, sell off some contracts, or stop my buying. When markets are over bought and highly leveraged, low margin is a big risk.
The COMEX vault just returned a lot of silver (200 million ozs) that came from the LBMA when there was the risk of it being exposed to tariffs and London was being squeezed for the shortage. Its supply went down and London's went up around a similar #. The COMEX vaults are not empty. Articles like this are misleading, and I am a big believer in physical silver and not a proponent of paper silver.
The raising of margin is also done to stop or slow down the leveraged margin buying to prevent a collapse, not force sales to drive down prices.
That is one of the things that they did to the Hunt brothers.
I really don't know what purpose that leverage serves other than to allow the exchange to affect pricing. What other purpose could it actually serve than to open up more gambling positions (on leverage)?
I knew it would happen.
as mentioned, the higher the price goes the margin amount oes up. also, in extreme volatility higher rates are safer for the participant and for the brokerages who would be on the hook in the case of a customer account blows up
have a trustworthy source saying the government did this intentionally to break the hunts? i'm not going to read prepperstacker.com on this
it's like how mortgage rules tightened after the financial crisis. the banks were protecting themselves from a shaky borrower. and it made sure someone dealing in a crazy market have the down payment. all of this was to begin paying. of course this analogy doesn't exactly correspond between home lending and futures in mid-stream. the idea is the same for mid-stream margin changes. broker self-protection and making sure you can cover losses.
Raising margins is the best proof that demand is high and that the COMEX wants lower prices. If believing that makes one a conspiracy realist then send me the T-shirt.
When gold and silver move together, it signals the coming end of fiat money.
@derryb said:
My wife makes them cheap
COPPER is gutter !
Eh, my reaction is: yes, no, and maybe. The author of the linked article clearly has an ideological axe to grind, so take it with a bit of salt.
I have read assertions that the silver and gold market has been manipulated for years with futures contracts to hold the prices down, as a cover for how weak fiat currencies have become. I lack the knowledge or insight to determine whether that's a conspiracy theory or a fact. However, it's becoming more and more difficult to surprise me with stuff like this; there are many things that I would have dismissed years ago as 'conspiracy theories' that have turned out to be factual.
"globally debt-sick financial and currency system" → that part, at least, is true.
I'd also agree with the author that a paper claim on silver is largely impotent. I own zero 'paper' gold or silver. Zero.
I've heard that central banks are loading up on gold. I have only read that one central bank, however, is buying silver, and I'm not too confident in the source. The linked article above implies that central banks everywhere are buying up all the silver, and I'm not so sure if that's accurate.
I guess only time will tell.
Serving the greater Mechanicsburg and Camp Hill, PA area
https://zenithbullionconsulting.wordpress.com/
Time may tell, but prices are telling.
When gold and silver move together, it signals the coming end of fiat money.
Hunt brothers were stopped by huge margin increases and nobody was able to by silver contracts on the Comex. They were only allowing selling of silver futures. It was a 100% hatchet job on 2 brothers who used the “Systems own rules” to corner the market. It’s funny how JPMorgan can own 500,000,000 ounces of physical at the same time they have one of the largest short positions (now covered) and nobody questions them…. The whole system smells fishy but the last few months have been fun.
Mike
MIKE B.
Hunt brothers were stopped by huge margin increases and nobody was able to by silver contracts on the Comex. They were only allowing selling of silver futures. It was a 100% hatchet job on 2 brothers who used the “Systems own rules” to corner the market. It’s funny how JPMorgan can own 500,000,000 ounces of physical at the same time they have one of the largest short positions (now covered) and nobody questions them…. The whole system smells fishy but the last few months have been fun.
Mike
100% exactly correct!
I knew it would happen.
to sell them, someone has to buy
Nobody was allowed to open a long futures position. I believe that all selling was settled in cash, and with no new long contacts allowed, the price went down.
That's a classic case of market manipulation by the regulators themselves. That's anything but a free market. Don't think that they can't do it again.
I knew it would happen.
Conspiracy holds down prices. Conspiracy raises prices.
Long live Conspiracy.
Knowledge is the enemy of fear
if someone sells 1 contract, then whoever buys that 1 contract is taking a new long position of 1
Conspiracy skews markets. That is why conspiracy is illegal.
then there are theories of conspiracy. . . until they are proven.
When gold and silver move together, it signals the coming end of fiat money.
Like concepts of a plan.
Knowledge is the enemy of fear
Paper prices are telling. Nobody is buying the physical garbage at these prices. RGDS!
Paper prices are telling. Nobody is buying the physical garbage at these prices. RGDS!
Let me get this straight. You have "thousands of ounces" of 90% silver and want to "unload" it, but you refuse to do so unless you can get a price higher than spot even though both the buy and sell market prices are still below spot and in spite of the fact that you would be realizing an impressive gain at today's prices.
Do I have it right? If so, my observation is that you don't inhabit the real world and should seek professional advice.
I knew it would happen.
Jmski52 said:
me get this straight. You have "thousands of ounces" of 90% silver and want to "unload" it, but you refuse to do so unless you can get a price higher than spot even though both the buy and sell market prices are still below spot and in spite of the fact that you would be realizing an impressive gain at today's prices.
Funny thing happened to me last night. I have some $100 bags of 90% that I put away a couple of years ago. Last night I was looking something I packed away with them and there was a note with it to my wife or kids if I’m not here. It said “Try not to sell for less than 20 times face. Guess it’s time to update it a bit.
Mike
MIKE B.
.
Correction:
Nobody is buying YOUR "garbage".
Recent sales of Silver Eagle rolls on eBay are going for about $70 to $75 per coin:
https://ebay.com/sch/i.html?_nkw=silver+eagle+roll&_sacat=11116&_from=R40&_trksid=p2334524.m570.l1313&LH_TitleDesc=0&rt=nc&_odkw=silver&_osacat=11116&LH_Sold=1
Agreed. The daily denial of reality continues.
https://www.pcgs.com/setregistry/gold/liberty-head-2-1-gold-major-sets/liberty-head-2-1-gold-basic-set-circulation-strikes-1840-1907-cac/alltimeset/268163
March of Time - 27 Centuries in Gold
https://coins.www.collectors-society.com/WCM/CoinCustomSetView.aspx?s=36590
No, margin increases were allowed at any time. It was clearly spelled out in the brokerage agreements with Bache & Co., the Hunt's broker.
Cornering a market is clearly illegal.
I like the Hunt Brothers but they were foolish to think the rules wouldn't change.
Paper is easier to trade. Who would be buying physical silver here who passed at $60, $50, $40, and $30 ?
You expect MORE people to buy as the price goes higher ???
When you need to rely on "conspiracy theories" to justify a higher price, you're in trouble.
Nobody is preventing anything, Derry, it's a figmant of your imagination. Everybody thinks there is a conspiracy when the price doesn't move their way.
Nobody here has "banking" interests, we just understand how financial markets work and don't allow half-truths and nonsense to go unanswered. Clickbait stories are not grounded in reality, sorry.
Ultimately, they are the same. These clickbait clowns think that institutions, banks, SWFs, CBs, etc....want to buy and sell physical silver. Well, no, JPM does not want a few dozen people carrying bags of junk silver for a week to the COMEX or NYMEX. It's easier to do paper trades.
Same reason why stock certificates are now digital (book entry) and not in-hand paper....and why options and futures are CASH SETTLED and you don't really take delivery of the underlying commodity ("Hi, I'm here with your 40,000 barrels of WTI Crude....where do you want me to put it ? Near the kid's swingset ?"
).
Good post....I've worked in 2 private banks and except for a few people wanting their bullion or numismatic coins, everything was cash settled via paper. I managed $$$ for some UHNW people....no way they were taking $50 MM of gold or silver to one of their dozen homes.
Absolutely. Human Being 101…. act impulsively. Feel like you missing the boat. New stackers always coming on.. have to start somewhere. Unless you have a flux capacitor.
Anyway, price is what it is. Not what anyone thinks it should be.
COPPER is gutter !
I like gold and silver as a small portion of my assets, I don't buy into all the conspiracy theories from either side, but I'm having a hard time squaring your two statements above.
Philippians 4:4-7
SO, THE RULES WERE CHANGED. I REST MY CASE.
When gold and silver move together, it signals the coming end of fiat money.
People are smarter. I think demand destruction has hit at these levels.
Speculators are now in charge of the market.
>
Yes, the Commodity Exchange (COMEX) significantly raised margin requirements and implemented new rules (like "Silver Rule 7") that restricted buying silver on margin in early 1980, forcing the Hunt brothers to find more cash or sell, leading to their massive margin calls and the infamous "Silver Thursday" market collapse when they couldn't meet them.
Key Actions Taken by Regulators:
Higher Margins: The exchanges made it far more expensive to hold large silver futures positions, requiring more capital.
Restriction on Margin Buying (Silver Rule 7): On January 7, 1980, COMEX banned new purchases of silver contracts on margin, essentially preventing the Hunts from leveraging further into the market.
Position Limits: Rules were also put in place to cap the total amount of silver contracts any one entity could own.
Impact on the Hunts:
These rules halted the upward momentum, causing silver prices to fall.
As prices dropped, the Hunts faced massive margin calls from their lenders, demanding more collateral.
When they couldn't provide the cash, their brokers began selling their vast holdings, flooding the market and causing prices to crash further, leading to their financial ruin.
PS::: it’s only illegal for people to corner the silver market. When JPMorgan and other Big banks do it regulators close their eyes.
Mike
MIKE B.
Pretty sure this entire run has been speculators. (Myself included
) RGDS!
No, as usual you don't have it right at all Jim. Nobody ever said I have thousands of ounces of 90% gutter except for you. 90% is somewhere in the neighborhood of 700 ounces. The majority of my physical gutter is in .999 green boxes, and then of course my favorite the SLV where I still retain thousands of shares. I never tried to get above spot for junk but I certainly wouldn't be dumping it at -20%, -30%, -40% as many are doing now. I must confess, no doubt the physical gutter has been a terrible investment. Physical gold I can dump at spot all day long. Even at the record highs. THKS!
uh huh...needs to troll post almost everyday for some type of acknowledgement...lonely guy lives with his mom apparently and now this dodge ball inflatable cup style bragging...#SOSAD
Loves me some shiny!
“Often wrong, but never in doubt.”
You just sold your SLV the other day and bragged about it. Get your story straight.
Both AGEs and ASEs are now being bought below spot. Just FYI.
I knew it would happen.
So when I bought silver when it was in the $10-20 range that was a terrible investment?
I'm surprised people see a conspiracy theory. The guy's just telling the truth mostly and stated in fighting words. . We did this to ourselves. We allowed things that don't work to creep into every aspect of our lives and now instead of paying the piper we'll clean out the rats. Things that don't work are being exposed everywhere by AI. The rest of us will just have to work around the problems.
Silver works. Its price is discordant.
So when I bought silver when it was in the $10-20 range that was a terrible investment?
Not unless you're waiting for a 10-bagger!
I knew it would happen.
so increased margin requirements do not prevent higher prices? You sure you want to stick to that story?
When gold and silver move together, it signals the coming end of fiat money.
prevent? obviously not
But I thought corporations were people, and money was speech! [For the record, that's from the Citizens United decision]
Perhaps Texas will have to put JPMorgan on the electric chair. I wonder what the Bank would request for its last meal...
Serving the greater Mechanicsburg and Camp Hill, PA area
https://zenithbullionconsulting.wordpress.com/
There's nothing to square. I worked for a pair of PBs and I'm not lobbying for banks who don't need it anyway.
I manage accounts through Fidelity....I don't own stock, private or public, or have any interest in their financial well-being. Abby Johnson (who I called upon 30 years ago) is doing pretty well without my help.
Except it's not happening. JPM and other banks don't speculate in silver. Their CEOs would be fired and the banks hamstrung by the OCC, FRB, and other regulators.
People who say things like that simply can't read a balance sheet or a 10-K.
CU simply leveled the playing field, which, of course, some people object to. When you control 90-95% of a the market for information, you don't want competition.
Increased margin just limits the amount of leverage speculators can play with, removes some of that excess high leverage and might stop some newbies from jumping into the market for FOMO. If you are a serious investor with the financial backing, the increase means nothing. Wouldn't say it prevents higher prices, as history has shown, or 100% causes a sustained price drop.
Yeah, I sold 1400 ounces of SLV about 2 weeks ago actually. Try to keep up. THKS!
My stalker troll doesn't go away. Moms' basement wearing you out? Sorry you missed the boat. THKS!
Silver market is too big to manipulate. The Reddit gang tried that during covid...... it failed. Leave the conspiracies to Tucker and the gang.
75% of Silver production is a byproduct, very difficult to increase meaningful production quickly.
Isn't increased leverage designed to reduce demand? And doesn't this in turn reduce prices?
When gold and silver move together, it signals the coming end of fiat money.
If the exchanges didn't want speculation, they wouldn't offer margin accounts. Increasing the margin requirement (especially during a runup) is hypocrisy at its worst.
I knew it would happen.
Just read this, which strikes me as a more reasoned take on this topic than most of what I've seen out there. https://vongreyerz.gold/alasdair-macleod-how-silver-has-been-suppressed
Means, motive, and opportunity are all satisfied in this article.
Serving the greater Mechanicsburg and Camp Hill, PA area
https://zenithbullionconsulting.wordpress.com/
Reads like more speculation...no hard data.