Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Gold & Gold Stock Analysis -- Ignore unavailable to you. Want to Upgrade?

To: TheBusDriver who wrote (14795)	9/9/2008 2:21:11 PM
From: ecrire	Read Replies (1) \| Respond to of 29622

A mid size hedge fund collapsed last week due to commodity losses. These funds were enormous buyers over the past two years and with investors shell shocked, redemptions have soared. cash was and is needed so positions are liquidated(same effect as margin call selling). Individual margin call selling no doubt also a factor.

To: TheBusDriver who wrote (14795)	9/9/2008 9:19:45 PM
From: Mike M2	1 Recommendation Read Replies (2) \| Respond to of 29622

Wayne, I agree with ecrire. I don't have proof to offer but the steep rate of decline in price action suggests to me that there is forced liquidation occurring. There is a saying selling begets selling. The long commodities/ short US$ was a crowded trade - when everyone is on board who is left to perpetuate the trend? The leverage used by some hedge funds creates the conditions for panic selling. The dramatic sell off last Aug. 16, 2007 was another panic sell off but this one is longer in duration and I would guess has done more damage to funds. Lets not forget stop losses getting hit and disciplined traders who sell when a position goes down a certain %. Some weeks ago Dennis Gartman appeared on CNBC's show- Fast Money said he was out of gold and commodities - a very good call.