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sojourn

UPDATE 1-CME members get 60-day extension for new margin rules

October 4 is when the new increased margin rates go into effect. Could this cause a crash in the markets?
Bomb
I would be OK with that so I could BTFD... good lookin' out.
(09-30-2012 01:32 AM)sojourn Wrote: [ -> ]UPDATE 1-CME members get 60-day extension for new margin rules

October 4 is when the new increased margin rates go into effect. Could this cause a crash in the markets?
Bomb

I doubt if it crashes the markets, its only going to squeeze the little guys out. Farmers and other bona-fied Hedge Funds aren't going to get the increase.

Quote"NEW YORK, July 24 (Reuters) - The CME Group has been granted a second extension by the U.S. Commodity Futures Trading Commission before imposing controversial new rules that will increase margins for its non-hedge, or spec, members, a CME spokesman said on Tuesday." End Quote.

Most of the little guys are going to be squeezed.... I would argue...
could someone please explain in dummy terms what margins are and what this possible move by the CME means or could mean. Ive asked before on here but still didnt quite get it.

any help would be appreciated. Thank you all.
(09-30-2012 08:48 AM)amerishima Wrote: [ -> ]could someone please explain in dummy terms what margins are and what this possible move by the CME means or could mean. Ive asked before on here but still didnt quite get it.

any help would be appreciated. Thank you all.

The short and skinny of it... In a margin account, you trade with money you don't have. I.E.:

Say you have 25,000$ in a margin account and the rules/requirements are that with every 25,000$ you have, you can trade with 100,000$. So imagine you have all 100,000$ invested into something and the CME hikes the margin rate say, 10%. What this does is raise the capital requirement (your original 25,000$ to 27,500$) in order to maintain playing with that 100,000$. So in a sense, what this does is cause people to liquidate positions (sell) in order to meet the higher margin requirements. This is a crude example but I hope it gets the point across.

.02

Peace
(09-30-2012 01:57 AM)SoberOne Wrote: [ -> ]I would be OK with that so I could BTFD... good lookin' out.

Exactly.

A correction is necessary to keep this bull running. Au and Ag have been flying high over the past 6 weeks. Technically speaking, anytime something goes parabolic too fast, it tends to crash just as dramatically.

Both Ag and Au look like they're on the verge of a major breakout, but all the technical indicators are in overbought conditions. However, those conditions can continue for quite a while.

Regarding Ag... a pullback to the 200 DMA ($30-31 range) would be healthy. Keeping lots of dry powder on hand is a smart thing to do.
(09-30-2012 12:10 PM)Fiat Facade Wrote: [ -> ]
(09-30-2012 01:57 AM)SoberOne Wrote: [ -> ]I would be OK with that so I could BTFD... good lookin' out.

Exactly.

A correction is necessary to keep this bull running. Au and Ag have been flying high over the past 6 weeks. Technically speaking, anytime something goes parabolic too fast, it tends to crash just as dramatically.

Both Ag and Au look like they're on the verge of a major breakout, but all the technical indicators are in overbought conditions. However, those conditions can continue for quite a while.

Regarding Ag... a pullback to the 200 DMA ($30-31 range) would be healthy. Keeping lots of dry powder on hand is a smart thing to do.

Judge throws out CFTC's position limits rule [Image: images?q=tbn:ANd9GcR2GTvN1A8p2aGHCn5H1fx...ppvqgdJ1qg]Bomb
(09-30-2012 08:48 AM)amerishima Wrote: [ -> ]could someone please explain in dummy terms what margins are and what this possible move by the CME means or could mean. Ive asked before on here but still didnt quite get it.

any help would be appreciated. Thank you all.

Sober did a good job, but I'd like to add more...

It means that more money is needed to buy/hold futures contracts. If they raise margin requirements (like the did many times in 2011), people holding these contracts will get "squeezed" (forced to sell) out of their postions in order to cover the margin increases. PM prices will mostly likely drop accordingly. This is quite convenient for the banks since the short positions held by them is quite substantial... it's all rigged in their favor.

These banksters get to play by a different set of rules than the rest of us average folk.
(09-30-2012 12:16 PM)Seattle206723 Wrote: [ -> ]
(09-30-2012 12:10 PM)Fiat Facade Wrote: [ -> ]
(09-30-2012 01:57 AM)SoberOne Wrote: [ -> ]I would be OK with that so I could BTFD... good lookin' out.

Exactly.

A correction is necessary to keep this bull running. Au and Ag have been flying high over the past 6 weeks. Technically speaking, anytime something goes parabolic too fast, it tends to crash just as dramatically.

Both Ag and Au look like they're on the verge of a major breakout, but all the technical indicators are in overbought conditions. However, those conditions can continue for quite a while.

Regarding Ag... a pullback to the 200 DMA ($30-31 range) would be healthy. Keeping lots of dry powder on hand is a smart thing to do.

Judge throws out CFTC's position limits rule [Image: images?q=tbn:ANd9GcR2GTvN1A8p2aGHCn5H1fx...ppvqgdJ1qg]Bomb

Damn, it feels good to be a banksta! -lol

This week should be an interesting week for PM's.

connectingdots1

The little guys aren't playing that much with the CME anymore and that's why the CME put out Adds trying to get traders back into the CME group, it's too late too many of us know their little BS scam/game, maybe not everyone but the fact alone the CME group had to go to the extreme of putting calls/adds out for traders to return to their game is a clear indicator that traders aren't interested in their scam anymore!!

Personally I hope they do raise them in fact I hope they raise them 5 times in 8 Days like they have in the past and then maybe moron silver Trolls like JPWannbe will finally get to understand how raising margins affects the price of silver. although i doubt it will have as much as effect as it did in 2011 when they pulled off this "unprecedented" raising as mentioned by numerous trading news agencies.
i hope they smack it down to 30 so this cup will have a handle
all right, makes sense to me now...thank you everyone for your help i appreciate it!
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