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Silver Wheaton Corp. Message Board

  • cmegladon cmegladon Dec 1, 2010 1:12 PM Flag

    Those who believe Dec 16th Position Limits

    will hugely impact their investments, please be careful what you wish for. Butler and his pals have it all wrong.
    Read this overview of what is likely to happen, and the exemptions allowed for the oversly and alleged short banks like JPM. This will be a non-event for them, but the long aggregators, like PM ETFs etc will take it hard on the chin. Good for PMs? I don't think so.
    This article is 10 mos old but gives an excellent overview.

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    • Eric,
      How about I end that post with IMO, ok?

    • I don't disagree with your post. However, theories spouted by Sinclair, Organ and Butler etc if proven, and if the underlying basis for their theories is corrected, even to their liking, JPM is not failing. It'll be a pimple on their otherwise unblemished face.
      Anyway, GL

    • whatever happens is bullish for the precious metals. If the regulators weenie out and give jpm an exemption then faith and trust in government takes a huge blow and precious metals skyrocket. Everything is bullish for the metals now. It is the perfect storm.

      • 1 Reply to cde_biscuit
      • cde,

        While I don't agree everything in this thread I can suggest something to buy which will skyrocket in the near future. FAZ is a leveraged 3x financial short. Just do some DD so you understand what the stocks is completely. The U.S. is certainly not out to save the Euro. They want both the Euro and U.S. Dollar to fail to unite a common worldwide currency. Before this happens the U.S. dollar must collapse in order to eliminate our deficits. China and Japan understand the game perfectly and are for it. It's not too hard to figure why.

    • Any serious "conspiracy theorist" knows the CFTC is very unlikely to draft position limit rules that would force the JPM/HSBC out of their massive short positions, so I'm not sure who you think is going to be disappointed about this.

      What will be interesting to see is if the limits (if and when they finally come) force the futures only based gold/silver ETF's to either move to holding physical metals directly (like CED/PHYS/PSLV) or for those that can't (like the 2X & 3X Ultra funds) cause them to shrink down. Either way after a short term fall in PM futures prices the net effect will probably be positive as there would be more large scale buying of the physical PM's by the above ETF's.

    • First, any ID with "CME" in the name seems biased. However, your link is quite old and predates the expanded jurisdictional powers given the CFTC to oversee the OTC markets for this very reason. JPM and it's ilk will not be able to claim a bona fide exemption to the position limits unless it can justify the hedge against an OTC position which the CFTC will now be able to confirm.
      If JPM is truly hedging against OTC positions, it has nothing to worry about. But it sure seems odd that they've been covering their short position since Chilton spilled the beans. Why would they do that if they were confident that this is a non-event for them?

      As to the ETF's and the position limits, it shouldn't be too much of a problem to impose position limits for each holder within the ETF.

      Personally, I don't feel like position limits are the problem. I think it's the freely handed out position limit exemptions to the likes of JPM and HSBC.

    • The only ETFs that would be effected are those that deal in the futures and not in the physical. So GLD, SLV, PSLV, PHYS, SIVR, and the mining ETFs such as GDX, GDXJ, and SIL would be untouched by any position limits in the COMEX.

      I'm unsure why you think that it would be bad for PMs. At worst, the banks could continue their short positions as they have now, and nothing would have changed.

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