If you've been keeping up with the latest in precious metals then you're already aware of the two external factors that have lead to the recent slump in silver: the dollar rally from the capture of OBL and another round of margin requirement rate hikes.
Both provide temporary relief for institutions shorting silver; however, margin hikes only make silver more attractive in an economic climate rife with over-levered speculative moves.
The CME is attempting to curtail the rise of precious metals by raising margin requirements. They are, in fact, raising the minimum collateral required, on hand, to purchase metals.
However, increasing the requirements will only make the metals more attractive to risk averse investors looking for a way to avoid massive ebbs and flows of highly levered speculative traders and the money being sloshed around by the rounds of QE.
Clearly this makes metals an even better preserver of wealth during these times of rampant inflationary pressure and of course, less susceptible to the whims of highly leveraged bets that send unbridled equities parabolic.
Silver has been aggressively breaking new heights-- not to be outdone by Max Keiser’s own antics.
Max was back on the Alex Jones show with his eyes set on JP Morgan; he theorizes that the bank is in dire straits from their naked silver short position. So could JP Morgan finally be susceptible to a double digit short? According to Keiser, once silver begins treading in the 40’s, which it just recently broke into, it could begin to demonstrate negative correlations as it relates to JPM’s stock.
We heard about this theory for a few months already, but we have yet to see JPM’s share price suffer from its alleged naked shorts. However, if there’s one financial analyst I wouldn’t take for granted it’s the wild, but uncannily accurate Keiser. This is definitely something to continue to observe closely in the next couple of weeks.