Found this on Investorsvillage posted by VOCEX1. Just shows the criminals always have a way out.

Another Take on Today's Slamdown

"We mentioned this morning on Chat at the open that the Chicago Mercantile exchange was in deep shit. They have been what we consider to be "complicit" in non-enforecement of naked positions in certain commodities. Gold and Silver being the most obvious. This left numerous dealers in bad shape this morning, they either had to cover and contribute to this rally started by the World Bank duffus, or hope it got burned out. Well the CME came to the rescue of its members. Note the term "letter" in the statement below. So the formal change notice was delivered to dealers probably early this morning. This then allowed them to short the hell out of the morning pop until the dealers then passed the info onto their clients. Then the cat was outta the bag."

(This is from a Canadian trading bulletin board, borrowed link from KevinKT, I found the timing of the 'heads up' to the dealers @ CME was interesting: the rest of us 'got the memo' after Comex closing, when Au/Ag were settled at/near the highs. So, some had a choice opportunity to get very short, knowing this margin call was going to hit.

Isn't this very similar to all the insider info pushed onto the Street ahead of Fed pronouncements/changes in policy, so the boyz can position.

Anyway, the technicals for Silver were verging on parabolic, and some pullback would be expected after this run, but the pre-announced margin change really got things rolling after Comex closed, trapping the new longs, and aiding an abetting the dealers opportunity to kill two birds with one well timed stone.

Interesting to me, Gold dropped about 25 bucks total from the new all time highs set in yesterday's trade, and gold is now trading @ just under 1400.
Seems odd that margin was changed just for silver, but not gold.
Perhaps the gold trade has been essentially abandoned, with all the producers dehedged and demand surging world-wide.

Question is: How is demand and especially available supply of silver bullion shaping up? For months now, talk of unfilled and delayed fills on demand for physical delivery @ CME/LME. Does shuffling paper and catching a few small specs in a trap constitute a counterbalance to continuing demand for physical?
We should find out soon enough.



Quote:
Tapping the brakes on the silver rally, the CME sent a letter to its clearing member firms and others Tuesday raising the amount of margin needed to trade silver futures contracts.

The change will go into effect after the close of business Wednesday, November 10th, 2010.
The reason cited for the increase was a “…normal review of market volatility to ensure adequate collateral coverage…”

Michael Shore, a spokesman for the CME, said the exchange evaluates margins from time to time and they often change—nothing unusual.

New Tier 1 “Spec” Positions will require an initial margin of $8,775, up from $6,750 currently. New “maintenance” margin calls for those positions will rise to $6,500 from $5,000 currently.

Margins on Tier 2 and 3 “Hedge/Member” Positions will go from $5,000 to $6,500 for both new “initial” positions and also, for ongoing “maintenance” margin calls.

CME silver futures trade in contracts of 5,000 ounce and are priced in U.S. dollars.

Margins on e-mini silver futures have also gone up across the board, from $1,350 to $1,755 for “initial” positions for “Spec” traders and from $1,000 to $1,300 for “Hedge/ Member” positions. “Maintenance” margin calls for all have gone up 30% from $1,000 to $1,300.

http://www.cnbc.com/id/40095040
Margin call caused the bailout of Gold Silver as the US$ strengthened and accelerated the selloff. Perfect timing and a perfect piece of manipulation and the people that benefited? Guess who, GS, JPM etc etc etc.