Time to Raise Margins Again for Silver Futures?
It hasn't taken long for silver price to climb again. Just this week it climbed to $85/ounce before dipping back down to $81/ounce. It took us a little longer to get there because of some futures shenanigans.
CME Group, the company that owns and makes the rules for the futures exchange known as the COMEX, raised margin requirements about a week ago. They didn't like the massive price increase they were seeing and panicked.
(Created with Bing)
What this means for futures contract holders is the cost to hold the contracts was increased. If you can't pay more by their deadline to keep them, you get cashed out. (Source)
So, what happens when many can't pay and have their contracts liquidated? Silver spot price drops. They claim it's an attempt to make sure there's enough "collateral coverage," but really it's a weak-handed attempt to halt a price rally. All it does is delay the inevitable.
(Source: Kitco App)
See that dip right after about 12/26/25? That's when they raised margin requirements. Yet here we are again, back to price rallying again and building steam. I'm betting they raise margin requirements again soon, to try and pump the brakes again. The problem is it won't work long-term. The bulk of the demand for silver is coming from industries: electronics, missiles, medical supplies, etc. We don't stop making those just because the price of silver increases. The cost of the end products go up, but not enough to curtail demand for said products. So, the price march will continue on regardless of what these pathetic fraudsters attempt.
It's a great time to be a stacker, and a bad time to be someone shorting silver in the futures markets!
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If I were Tesla'a Procurement manager I wouldn't care about the price of silver, I'd have to secure it to supply the next 2 Quarters of production or else $billions in manufacturing capital will screech to a halt. You can't make EVs with a paper promise of silver.
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I bet Elon could be developing and planning for some asteroid mining projects for SPACEX.
Right? I wouldn't be surprised if larger companies are negotiated direct silver shipments from mines and refineries to save costs and lock in prices.
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