LME nickel contracts in default.
cladking
Posts: 28,747 ✭✭✭✭✭
Here I've been so concerned about silver going into default that I didn't
catch the fact that nickel already is. There is relatively little speculative
demand in nickel like in silver, and pricing pressure is caused by shrink-
ing inventories and industrial consumers taking delivery.
The LME is allowing shorts and forward sellers to defer delivery which a-
mounts to default.
There is great speculative demand in silver and this could be the trigger
that breaks the back of the shorts.
Those who are inclined to gloat might want to wait to see if the markets
can even weather a default.
catch the fact that nickel already is. There is relatively little speculative
demand in nickel like in silver, and pricing pressure is caused by shrink-
ing inventories and industrial consumers taking delivery.
The LME is allowing shorts and forward sellers to defer delivery which a-
mounts to default.
There is great speculative demand in silver and this could be the trigger
that breaks the back of the shorts.
Those who are inclined to gloat might want to wait to see if the markets
can even weather a default.
tempus fugit extra philosophiam.
0
Comments
New collectors, please educate yourself before spending money on coins; there are people who believe that using numismatic knowledge to rip the naïve is what this hobby is all about.
<< <i>What would that mean? Prices going up, down, staying the same? >>
I think the implication is that this will scare those who are shorting silver into thinking that something similar could happen to silver, which will cause some shorts to panic and cover. That will in turn raise the price of silver, which will cause *more* shorts to cover and potentially produce a very powerful rally.
<< <i>
<< <i>What would that mean? Prices going up, down, staying the same? >>
I think the implication is that this will scare those who are shorting silver into thinking that something similar could happen to silver, which will cause some shorts to panic and cover. That will in turn raise the price of silver, which will cause *more* shorts to cover and potentially produce a very powerful rally. >>
Indeed.
The problem is that there has to be a resolution to the mess in nickel. Any fix is
liable to bankrupt the losers (shorts) and not fixing it could endanger all the world
stock and futures markets.
I don't know who the shorts are but they are obviously big if the LME is trying to
save them.
This is perilous.
If ya got 'em, smoke 'em.
is powered by collapsing short positions it's possible that even clads could contain
more than face value in metal and make our entire currency system obsolete. This
is improbable but so was a default in nickel.
The Brits sold gold (not sure to whom) to help protect the LME when they were about to default on Copper. Now you have to wonder if they'll dump gold again to help drop nickel prices? It worked like a champ to help dump the price of copper.
roadrunner
<< <i>The demand for nickel in industry is near insatiable right now.
The Brits sold gold (not sure to whom) to help protect the LME when they were about to default on Copper. Now you have to wonder if they'll dump gold again to help drop nickel prices? It worked like a champ to help dump the price of copper.
roadrunner >>
Very interesting. I'm going to have to start following markets much more closely.
If dumping gold stabilized the copper market the implication is that much of the copper
demand was speculative and selling gold would tend to dilute speculation. The crunch
coming in silver is reality based, as is apparently, the existing crunch in nickel.
Even at current prices the amount of nickel in something like a stainless steel hemostat
is pretty nominal. Nickel consumption can be reduced with high prices but there is a very
real need for it in many applications.
One has to wonder if the narrow line between recession and inflation hasn't led the world
to a place of shortages and commodity sparked inflation. You can't fool mother nature and
the FED, politicians, and central banks have been trying for a long time now.
Notice the big jump just before the RoHS effective date.
<< <i>So long as China keeps growing, this unprecendented demand for raw materials will continue. Buy mining and oil stocks. They seem like sure bets for the forseeable future. >>
I've increased my asset allocation in natural resources stocks and mutual funds from 3% of my portfolio in 2001 to 12% today. Even that might be too low, given the inevitable strain on finite resources in the face of economic and population growth.
Note that nickel is up another 50% and the 5c coin now has 8c worth of metal in it.
TTT
I can still get them from my bank at face value.
We can both make some money here. It's a win-win situation, eh?
Let me know.
Ray
<< <i>If you'll pay shipping, I'll sell you all the nickels you want for 7¢ each cladking.
I can still get them from my bank at face value.
We can both make some money here. It's a win-win situation, eh?
Let me know.
Ray >>
There are 30,000,000,000 nickels in circulation. Even at 8c each the total value is a mere $2,500,000,000.
This will keep the factories running for many days before too long.
Somewhere from the great beyond, I think I hear Vanderbilt whispering in the ears of those that have nickel for available for delivery "take it to 1000..."
(nickel is currently about $21.40 per pound)
some background on 19th century stock speculators
to a new composite material.
news at eleven