Browse Symbol Stacks: ASHR: 3 jul27.PNG

3 jul27.PNG

Worst nightmare of leveraged market participants coming true!

Comments

Silver SingularitySilver Singularity
2008 was a liquidity crisis. 
Next one coming will be a crisis of "THE liquidity" wich is completely different! 
EUR/CHF was a crisis of "THE liquidity". 
That's why QE4 is coming... there's going to be some seeeeerious holes to patch in several balance sheets before we can recover crashed (or surged) prices 7/26/16
Silver SingularitySilver Singularity
... surged prices may never recover contrary to crashed ones! 
See what I mean? :/ 7/26/16
RedarinaRedarina
SO can you please elaborate on this for us below average slopers? 7/26/16
Silver SingularitySilver Singularity
If silver price manipulation theory is real, that would be the perfect occasion to get rid of the hot potato! 
That would also explain why circuit breakers were implemented in 2014. 
For silver, last circuit breaker (stops trading until next day) is a $12 move... sic 7/26/16
Silver SingularitySilver Singularity
ok so take the example above. 
Before, you often had 1 and 2 million contracts traded during one day. 
Now it's 13500 
So even if the price collapses, the majority of people that already have positions will not be able to liquidate them because there is nobody big enough on the other side of that trade. 
The problem comes from leveraged actors. They can't support a move too big, so, when the market hits their limit they HAVE to sell!!! 
Because they can't, their accounts goes in the negative (they burn money that doesn't belong to them) 
And that creates holes in the balance sheets of financial firms. 
Holes can be enormous and threat to crash the entire system. The only solution is to fit the holes with money printed by the central bank (massive inflation) 7/26/16
Silver SingularitySilver Singularity
If the US markets go down hard then this scenario is a real possibility for the chinese stock market 
And that would also have huge consequences on the commodities 7/26/16
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