"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat

Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput

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Wednesday, August 10, 2011

CME GROUP hikes margins for gold

Effective as of the close of trading, margin requirements for gold are being raised from $6,075 to $7,425 for new positions and from $4,500 to $5,500 for "current maintenance" margins. WE had expected this to actually come a bit sooner than it did on account of the extreme volatility and extent of the intraday price moves that have recently been taking place in gold. This is a normal occurence in bull markets which begin to see large moves in price and is designed to protect the integrity of the clearing houses and of the brokerage firms, which can set their own margins for their customers.

Apparently the announced hike has not impacted gold the least as it continues to trade above $1,800 at this hour and as of yet shows no sign of weakening.


  1. The charts you've posted the last week have been some of the most exciting I've seen in a long time.

    Looks like gold is momentarily stabilizing now that it blew past 1800 and came back a little. I look forward to seeing margins hike a little more in the next few days. Cash markets make things all the more natural and that appeals to us all.

  2. It will be interesting to see if gold gets hammered when the COMEX opens tomorrow morning as happened after the siver margin hikes earlier in the year. I'm really looking forward to the day when these actions in the futures market have no impact on the physical price.


  3. Thank you Dan, I woke up at 4 AM and sold my positions due to your report on the margin hikes. Now, with my powder dry I will wait!


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