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| Yes. The exchange declared "no new positions" can be initiated. Liquidation ONLY. The CBOT took similar action in the grains on one occasion. Ends a long squeeze & means the existing longs can only sell & shorts can only buy. Naturally puts the longs on the defensive and leads to a collapse in the price. I was sitting in a directors meeting (as a guest) & I noticed these 80 & 90 year old geezers slipping in and out of the meeting & when we adjourned to a private club for lunch all were smiles, relaxed and celebrating over dry martinis....they (and most other clearing members) had been stretched as they had to meet margin calls at the clearing house several times a day & the customers money was "slow" on coming in (most were broke)...SO..ALWAYS REMEMBER "Free markets for Free Men" (when you get to the point of the gripping of the short hairs & the ankle grabbing) the real FREE MEN 'control the exchange.' They can pull that rule out of their hat whenever needed. There is a very interesting book, CARGILL, which I have somewhere in my library, and a chapter, as I recall, is devoted to the experience Cargill suffered when they Confronted some difficulty with the CROWD.....Cargill lost. Technically speaking, our funds are always very safe in the segregated funds account, except we have no 1st lien & I always like to slide the money back into my own bank as soon as available.
There was an unsubstantiated rumor-that a well-known international money man, now deceased, was able to short a huge package of silver just prior to the action of the exchange. His name was thereafter held in high esteem in some quarters of wall street. I am a basic rube so it required a couple of hours for me to add 2 + 2.
Rule: always follow the money and 2 + 2 does usually equal 4.
I mean no offense here-- there are a lot of those folks who believe most of us are pretty stupid....sometimes I think we are..the older I get, the less I know and the less I believe in coincidence and government. I wish it were not the case.
Edited by SeniorCitizen 4/22/2010 10:47
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A Caution
