Platinum and palladium have had some positive days this week. In spite of a slight drop during today’s trading so far, things still look good for the two noble metals.
Looking back to the last week of May, the 26th to be exact, the CME changed numerous margin requirements across the board. Platinum and palladium were included in these changes. To our surprise, not much has been said of these changes, and here is why we are surprised.
If you recall the recent attack on the silver market by the CME when they raised margin requirements for silver five times in ten days, bringing the price down from over $49 to $32.83 in what seemed like a blink of an eye. On top of that it was done over a four day holiday weekend with the LBMA closed for business, but that’s for another day.
The point is, margins were increased, and it caused the price of silver to tank.
The margins were lowered for platinum and palladium…..
Does this mean higher prices for these two metals? So far, yes….
Some are thinking this was done to assist the automotive industry and the correlating situation in Japan. Platinum and palladium are key metals in the auto sector, heavily used in catalytic converters. Manufacturers tend to invest in the metal for future use, and if a price increase is on the horizon, it could be an avenue to lower production costs, as the metal will be locked in at a discounted price, and provide a profitable sector for the hard hit manufacturers in Japan.
You can read the CME official advisory notice here;
We’ve recently caught up with Michael Rothman of The Rothman Group. “I’ve been a buyer of platinum since the $1,400 mark. Platinum is a longer term investment for higher net worth individuals that will be profitable. It is the only metal that has not reached the high of 2008, and it will get there! That’s a conservative target, especially with the lack of an agreement coming out of OPEC today.”
What significance does oil play with platinum?
“Platinum was at $2,300/oz. when oil was trading at $149/barrel in 2008….”
“The amount of research hours that have been put in to platinum with us is immense, and readily available for anyone that would like to have it.”
If you would like a copy of the platinum research report that The Rothman Group is offering, just call;
877.239.7269, or visit them online at http://www.RothmanMetals.com