Posted on 01/30/2021 10:05:16 PM PST by Technocrat
APMEX prices started rising by the minute two hours ago and they are now out of stock on all significant silver coins. Available rounds if you can find them are now priced at double to triple the spot price. A coordinated attack against JP Morgan and other silver market manipulators was proposed on Reddit on Friday. The link above goes to junk silver.
The action now appears to be spreading to Gold somewhat
“The traders aren’t sophisticated. They just have the best government money can buy backing them up. They know they will get a bail out no matter what they do.”
Dead on. this isn’t complicated. It could be stopped tomorrow afternoon, but the SEC is a criminal enterprise that makes its money off the criminals who pay off the political parties.
Well whatever you’ve got just hang onto it. Its all good.
Thank you. The eight year old has another question or two.
1. What happens if the naked short seller Person B doesn’t have the $ to actually buy the stock to give back to Person A?
2. What happens if a large number of people do this all at the same time?
3. If a lot of Person B’s do this all at once, can this actually affect the prices of the stock and if so, what direction?
Eight year old thanks you in advance. I know zero about stocks/markets and your explanation was helpful.
GO KICK SOME ASS GUYS AND GALS!! More than one way to SKIN A RAT!!!
“1. What happens if the naked short seller Person B doesn’t have the $ to actually buy the stock to give back to Person A?”
Excellent question, actually.
People who want to short stocks typically have to have reserves of 150%. So a $10 stock requires $15 to be placed in the broker’s account first in order to execute a short sale.
Of course, if the price goes up, and the increase exceeds that 150%, then the broker usually requests more funds to be deposited. If you still cannot meet the price of the stock, you are bankrupt if you cannot cover the costs.
This does happen, and routinely. However, most investors have plenty to cover losses. Let’s say that $10 climbs to $50 *ouch*. An investor usually calculates what they can afford to risk and can probably cover that $50. If that stock climbs to $500 *super ouch*, the investor may not have calculated that risk and could literally be in bankruptcy court.
It is not illegal to be upside down on a short, but like all debt, you can find yourself in collections.
“3. If a lot of Person B’s do this all at once, can this actually affect the prices of the stock and if so, what direction?”
That is the perfect question since that is exactly what we are talking about here.
Short sales have the effect of putting downward pressure on stock prices. If you look at all open offers to sell and see a $10 stock having 100 offers of $5 and only 25 offers for $30, you might think the stock is going down in price.
You may see stock sales close lower, too. Stock prices are ‘spot’ prices, meaning on the spot, right now, in the moment. A $10 stock selling at $9.90 cents at this second doesn’t mean that is what the stock may be worth 2 seconds from now when another sale closes at $10.20. Stocks vary wildly all day long.
What the Reddit Raiders are doing is sacrificing their money to buy a $10 stock at higher and higher prices. They don’t want profit and couldn’t care less if they lose everything. They want revenge on the rich who manipulate the stock market. Good or bad, revenge is their goal. They buy stocks at higher and higher prices which forces all those big banks to lose money on all those illegal, and legal, short sales.
Funny thing, though, is that as the stock climbs higher and higher, the banks keep having to buy to cover their short sales and buy the stock at the higher prices, and these Reddit Raider are making millions! Eventually, at the end, someone takes a bath as the stock price tumbles to a more reasonable value. That might be the banks or the Reddit Raiders.
Thanks, sounds extremely crazy. But then, we live in extremely crazy times. It seems silver figures heavily in this, are they shorting any stocks or mostly silver?
Hmm, I sort of understand. A completely different world; nay, universe, than what I inhabit.
So when I trade in cattle futures I can expect a trailer full of cows pull up to my house? 🤠
Not unless you are registered as a commercial trader. And then you have to arrange your own delivery from the contract delivery warehouse/yard location. This isn’t Carvana, click and it shows up in the driveway:)
writ large...
Not saying it is true, but I am not surprised. Silver is a commodity. There are a lot of “paper” commodities that have no relation to the physical product.
A silver certificate can represent a real amount of silver, a pretty piece of paper, or an email. Until you get delivery, it is sometimes hard for the average joe to know.
Saw this as a kid in ag commodities. Saw more than one guy get ruined when he couldn’t deliver, and one commit suicide when he got caught on the wrong side of a short.
Hopefully, people can purchase stocks in bongs, because all the hedge fund managers are going to be using them after the little people are done financially carpet-bombing them.
DANG!
Correct.
You can (and many do) pay for storage, but you can also arrange for delivery.
Used to do it with chemicals. I would set a position on say, Sodium Hydroxide with a set delivery schedule with a certain percentage retained in the sellers storage (in case of production upsets, weather, etc).
Where it gets tricky is you see a contract get passed around a few times before it finds someone needing a delivery. As I mentioned before, I know ag guys who made a lot of money in an office and never saw a bushel of corn. Just have to move the paper.
Be very wary about anything you read here. If you value your hard earned dollars, run for your life and don’t look back. :)
FUTURES up only 1.75. LAME
Good post.
J.P. Morgan settles lawsuit that accused firm of ‘spoofing’ precious metals markets trades
PUBLISHED TUE, SEP 29 202011:27 AM EDTUPDATED TUE, SEP 29 202012:00 PM EDT
J.P. Morgan settled for an undisclosed amount a lawsuit that accused the firm of “spoofing” trades in the precious metals market.
The suit by hedge fund manager Daniel Shak and two commodity traders accused J.P. Morgan of manipulating the silver futures market, costing plaintiffs $30 million in losses.
The bank is also nearing a settlement of $920 million to resolve government investigations for similar alleged conduct in the precious metals and Treasury futures markets, CNBC has learned.
I would never, ever do anything with the stock market except look at it with awe and fear and a lot of confusion!
In the past I’ve been a few $ of silver coins, just sitting there, for years. Probably give to my kids.
That’s it!
Thanks for more info.
All the more reason (besides complete lack of funds) that I would never, ever get into this stuff!
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