CFTC Limits vote today! 3-2 it passes

[V10Silver]

With the current beat down in AG prices it can only mean one thing. The CFTC is meeting today and voting on position limits. JPM is getting a jump on the good news and beating our friend silver like a red-headed step child. Hold Fast my friends good times SOON!:cool:

[Large Sarge]

I saw a blip on bloomberg, underneath (the ticker scrolling), and it said "CFTC institutes position limits under Bart Chilton"

I thought I was hallucinating, seriously!

can we get some more confirmation on this...

[Large Sarge]

http://www.publicbroadcasting.net/ksfr/news.newsmain/article/0/5/1862506/Business/Exclusive.CFTC.has.votes.to.pass.position.limits


Exclusive: CFTC has votes to pass position limits

(2011-10-11)
(Reuters) -
By Christopher Doering

CHICAGO (Reuters) - The head of the U.S. futures regulator has the support he needs to pass a long-awaited rule that would curb excessive speculation in commodity markets, a source with knowledge of the agency's rule-making told Reuters on Tuesday.

The U.S. Commodity Futures Trading Commission announced on Tuesday that it would vote on October 18 on a rule limiting the number of contracts any one speculative trader could hold in commodity markets.

The source said the agency was still making changes to the position limits rule and there was a chance changes could upset the balance of support among the five commissioners before next Tuesday.

"I think he does have the votes," the source who closely follows the rule-making process told Reuters, referring to Gary Gensler, the CFTC's chairman.

The CFTC has postponed two scheduled meetings on the position limits plan, with the most recent canceled due to a lack of the three votes needed for its approval.

Curbing excessive speculation is part of the CFTC's efforts to enact sweeping reforms in the Dodd-Frank financial reform overhaul of 2010 that required the agency to regulate the $600 trillion over-the-counter derivatives market.

Gensler told reporters on the sidelines of a Futures Industry Association conference in Chicago on Tuesday that position limits were next on the agency's to-do list, but he declined to say whether he had the support needed to pass it.

The CFTC has estimated it will cost the industry more than $100 million to comply with the position limits rule, Scott O'Malia, a Republican commissioner, told reporters after speaking on a panel in Chicago.

Most of the cost for the industry is expected to be soon after the rule goes into effect.

"You have to look beyond the implementation costs and look at the larger costs," Craig Donohue, chief executive of CME Group Inc, told Reuters Insider.

"If we create an environment where people fundamentally can't manage within the constraints of the new position limit requirements ... that will result in much more fundamental costs to the industry in terms of their commercial activities."

O'Malia expressed concern the cost to comply with the rule could be too expensive, especially for bona fide hedgers, or companies that use physical commodities themselves and seek to lower risk by entering into contracts in order to guard against price increases.

"That would be expensive for them and I'm a little bit concerned about the burden that we're placing on commercial hedgers to justify why they shouldn't have limits," said O'Malia. "They have to have the compliance and reporting mechanism to show why they're not," he said.

The commission has never presented a unified front on position limits, one of the most contentious pieces of the financial overhaul for big commodity traders.

In January, Republican Commissioner Jill Sommers opposed releasing the draft rule for public comment, while Democrat Michael Dunn and O'Malia expressed skepticism on how effective the rules would be. Gensler and Bart Chilton have been staunch supporters throughout.

Some CFTC commissioners also are skeptical that the limits would prevent a run-up in prices. The agency's economists have not been able to find a causal link between speculation and price volatility. One study concluded commodity index traders are not causing price volatility and may actually help reduce it.

The Dodd-Frank legislation gave the CFTC the power to set position limits to curb excessive speculation in 28 commodities, including energy, metals and agricultural markets, "as appropriate."

The law required the CFTC to have position limits in place by mid-January.

Last month, Reuters obtained a draft final rule on position limits that showed the CFTC was yielding to banks and other major traders on several key provisions.

The version also would have eliminated the proposed conditional limit--which would have allowed for a higher limit in the spot month in a cash-settled contract than in a physically deliverable contract.

The CFTC also cited comments that urged it to gain further experience with swaps to ensure adequate liquidity for bona fide hedging transactions and positions before imposing restrictive conditions on people holding both cash-settled and physical delivery referenced contracts.

(Additional reporting by Jonathan Spicer and Ann Saphir in Chicago; editing by Russell Blinch, Bob Burgdorfer and Carol Bishopric)

© Copyright 2011, Reuters

[Large Sarge]

Implication of CFTC Vote on Limits in Commodities(silver)
posted 11 minutes ago by Yothin sae-phan Implications of Today's CFTC Vote on Position Limits in Commodities (Silver)

The long awaited day is finally here. Oct 18th. The day the CFTC is scheduled (for the 3rd time) to vote on position limits in commodities.

Speculation has been rampant among the silver community regarding whether the CFTC will finally move to curb the gold and silver manipulation or whether it will continue to look the other way while the biggest crime of all time continues unabated. Here's how we see the situation unfolding.

All the signs point to the fact that the CFTC is in fact preparing to approve position limits in commodities. Our sources are indicating that the limits will likely be approximately 3,000-5,000 contracts (roughly 2-3x the levels called for by Ted Butler of 1,500 contracts).
Gary Gensler's Congressional hearing for Oct 6th was likely cancelled with the understanding that the CFTC would finally get off their arse and get something done on the 18th.
Bart Chilton has been responding to silver investors' emails this week and stating that he is in support of "strong limits" in commodities.
It is becoming apparent that The Morgue could read the writing on the wall, and crashed silver by 27% in 2 trading sessions several weeks ago with the intentions of getting out of as many naked short silver contracts as possible.
The problem for The Morgue is that their short position remains at nearly 15,000 contracts- or 75,000,000 ounces of silver. Even AFTER two separate 30% smash-downs of silver within 6 months, The Morgue's naked short silver position remains nearly equivalent to the US Mint's entire Silver Eagle sales over the past 2 entire years!
While it appears that the CFTC is preparing to implement position limits, DON'T expect the CFTC to require imminent or even timely compliance by the shorts. Something in the time-frame of 3-5 months is conceivable. (Unless Bix Weir is right about a planned collapse by the good guys, in which case a hard position limit of 1,500 contracts with immediate compliance required should do the trick)
So if this is what we see by the CFTC the real question obviously is what will The Morgue's response be with their remaining 15,000 contracts. IF they are forced to reduce their short exposure, obviously these banksters will do so at the lowest price possible. Currently there is hardly any blood left to squeeze out of the longs. Any long who might have been forced to dump their positions due to massive losses and margin calls during the last smash-down have already puked all of their positions. All remaining longs are likely in extremely strong hands.
SilverDoctors' reader Sierra has suggested that The Morgue will let silver run back up to $38-$40 in an attempt to bring in as many new longs as possible before JP Morgan induces the grand finale of silver takedowns in an attempt to drive silver back towards $20 and cover as many of their remaining 15,000 contracts as possible. We agree that this seems to be the most likely scenario- should the CFTC approve strict position limits. Understand that should silver run back up into the upper $30's prior to a final massive cartel raid, many new silver investors (especially those who have began investing in silver after Nov 2010) will be demoralized and throw in the towel. This will allow JP Morgan and other insiders to go long.

If we are wrong and the CFTC allows the status quo (massive manipulation) to continue unabated, ironically it will likely have bullish implications short term for silver, as The Morgue will not be as desperate to extricate itself from its remaining 15,000 naked shorts, and will likely allow longs and open interest to build for some time before the next massive raid.

Source: http://silverdoctors.blogspot.com/

[Large Sarge]

vote is going on now 9:30 EST

watch it live, below

http://www.capitolconnection.net/capcon/cftc/101811/CFTCwebcast-live.htm#

[Large Sarge]

Bart Chilton might have slipped a little, if (BIG IF HERE) I heard him correctly.

he said at times, one entity (JP Morgan) has controlled over 40% of one market (Silver), and anyone can see that they control the price

then he said, in the future we will have a limit of no more than 10% of any market , or 25,000 contracts

again, this was what I heard him say.

I might have misheard him.

he also said, he wanted much tighter controls (especially on precious metals), but he was willing to start here.

[Neuro]

Hmmm... Surprising that this comes now when positions is at all time low. None of the big players needs to shed any of their short positions at a loss at this point. Anyhow I guess for now it will mark the end of a decades long massive short price supression scheme, I guess the bankers are getting ready to dismantle the Fiat system, cause that is going to be the result of nonmanipulated precious metals...

[Twisted Titan]

limit as many postions as you want.

I hold physical ........so you can kiss my silver @$$

[ximmy]

Hmmm... Surprising that this comes now when positions is at all time low. None of the big players needs to shed any of their short positions at a loss at this point. Anyhow I guess for now it will mark the end of a decades long massive short price supression scheme, I guess the bankers are getting ready to dismantle the Fiat system, cause that is going to be the result of nonmanipulated precious metals...

Not surprising, everything is planned, and you can bet "limit" regulations are subject to change as profit avenues change.

[Neuro]

Not surprising, everything is planned, and you can bet "limit" regulations are subject to change as profit avenues change.

Yes! Rules are only rules as long as it benefits the Masters of the Universe, at the expense of almost everyone else... I must say though that I am grateful for the cheap silver I have been able to pick up due to the papergames being played, and the help I have gotten from many here to see through their games. IMO time is running out re picking silver at a cheap price. I still maintain that silver will cost close to $100 in late spring next year... PIIGS default will see unprecedented monetization, that will sling PM's into stratosphere... Greek one year bonds are now at 180% yield equivalent, they have already defaulted, it is obvious to any observer, it is just that no-one dares to scream that the emperor has no clothes yet...

[Shami-Amourae]

I still maintain that silver will cost close to $100 in late spring next year...

Anyone else here think something like this is possible? Not putting you down, I honestly have no clue what's going to happen myself.

[ximmy]

Anyone else here think something like this is possible? Not putting you down, I honestly have no clue what's going to happen myself.

Having been held down for so long, it could easily jump any time...

"According to the Dow Jones Market Data Group, gold’s record of $875/oz in 1980 translates into $2,371.11 in today’s dollars. That’s roughly 2.7 times the 1980 price. Using the same math, silver’s inflation-adjusted price would be $131.49/oz. The Minneapolis Fed inflation page calculates it at $130.48/oz."

[Large Sarge]

apparently position limits passed

seeing it from a number of sources (kitco forum, others)

no details on the limit size yet

[Plastic]

Dunno what will happen, but metals sure did an about face today, going from smashed to OMG BUY!

I am thinking what Neuro said might be about to happen, the intentional collapse of fiat and impoverishment of all humanity. Well, almost all of humanity.

Mad Max the planet in the name of world government.

[Large Sarge]

here is the final text on position limits

still trying to wade through it,

http://www.cftc.gov/ucm/groups/public/@newsroom/documents/file/pl_factsheet_final.pdf

[Large Sarge]

ok, some of the rules are coming out, very soft on JP

looks like they have a year to squirm out

http://silverdoctors.blogspot.com/2011/10/its-all-in-fine-print-cftc-ruling-gives.html

[ximmy]

ok, some of the rules are coming out, very soft on JP

looks like they have a year to squirm out

http://silverdoctors.blogspot.com/2011/10/its-all-in-fine-print-cftc-ruling-gives.html

Oh thank god!

[Joe King]

Dunno what will happen, but metals sure did an about face today, going from smashed to OMG BUY!

I am thinking what Neuro said might be about to happen, the intentional collapse of fiat and impoverishment of all humanity. Well, almost all of humanity.

Mad Max the planet in the name of world government.At least "mad max" the Western World. To attempt to usher-in any kind of World gov, it must first be brought down a number of notches. Otherwise, what's the excuse for World gov if not to "fix" things?

ETA:The people must first be shown that their current systems have become un-workable.