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Simple explanation for the recent PM fall
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<p>[QUOTE="Cloudsweeper99, post: 1174417, member: 3011"]I would just suggest that leverage is not a sign or or a cause of manipulation. Concentration is. In the silver futures market, there are no players with concentrated long positions large enough to rise to the level of "manipulation." However, there are a handful of enormously large short postions, and the regulators don't want those firms financially damaged. People can legitimately speculate that if there is any manipulation going on, it is to keep the silver price lower than it would otherwise be. I don't think the elimination of leverage would help the markets, but if everyone had to put up 100% cash for long positions and sellers had to put up 100% physical silver to cover short positions, the silver price would be higher than it is now because it is a tiny market by world standards and there isn't really enough physical silver, which is why cash settlement is permitted.[/QUOTE]</p><p><br /></p>
[QUOTE="Cloudsweeper99, post: 1174417, member: 3011"]I would just suggest that leverage is not a sign or or a cause of manipulation. Concentration is. In the silver futures market, there are no players with concentrated long positions large enough to rise to the level of "manipulation." However, there are a handful of enormously large short postions, and the regulators don't want those firms financially damaged. People can legitimately speculate that if there is any manipulation going on, it is to keep the silver price lower than it would otherwise be. I don't think the elimination of leverage would help the markets, but if everyone had to put up 100% cash for long positions and sellers had to put up 100% physical silver to cover short positions, the silver price would be higher than it is now because it is a tiny market by world standards and there isn't really enough physical silver, which is why cash settlement is permitted.[/QUOTE]
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Simple explanation for the recent PM fall
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