Euro feels like it's getting ready to crash the way gold just did overnight

Something's going on. I don't know what it is, but it just feels like something is going on. The big collapse in gold and metals overnight--which saw the CME halt trading, TWICE--seems like some kind of "canary in the coal mine" type of event.

The dollar is getting squeezed higher. It's been sort of relentless now for the past few weeks and it just seems to be intensifying.

I think the euro is getting ready to collapse. There is no, "harder to get" dynamic here, folks. Very shortly it seems like you're gonna be able to have all the euro you want, but NO ONE will want them that's the problem. (Or, bonanza, if you're short.)

Media coverage with respect to the euro has been quiet. Can you imagine the headlines when EURUSD breaks down below parity? (1:1.)

I think that's where it's going.

Matthew Leising — CME Seeks to Broaden Cash Options in Clearinghouse Default Rules

“We talked to a number of clearing members and regulators to determine what solution might satisfy the concerns and also create the least adverse impact for clearing members and their customers,” she said. “Our conversations with regulators indicated that they were looking for an outcome in which the clearinghouse didn’t access the discount window directly, but still used it effectively through primary dealers.”

Sorting out how to keep clearinghouses solvent is critical, said Will Rhode, director of fixed income research in New York at Tabb Group LLC, a financial-markets research and advisory firm.

“This is a massive deal because it’s coming down to the fact that somebody’s going to have to step in” to prevent a major clearinghouse from failing in times of stress, he said during an interview. “The potential of a clearinghouse default is equivalent to several Lehmans,” he said, referring to the 2008 collapse of Lehman Brothers Holdings Inc., one of the largest swap dealers at the time.

Bloomberg News
CME Seeks to Broaden Cash Options in Clearinghouse Default Rules
Matthew Leising

As the world's leading and most diverse derivatives marketplace, CME Group is where the world comes to manage risk. CME Group exchanges offer the widest range of global benchmark products across all major asset classes, including futures and options based on interest rates, equity indexes, foreign exchange, energy, agricultural commodities, metals, weather and real estate. CME Group brings buyers and sellers together through the CME Globex electronic trading platform and trading facilities in New York and Chicago. CME Group also operates CME Clearing, one of the largest central counterparty clearing services in the world, which provides clearing and settlement services for exchange-traded contracts, as well as for over-the-counter derivatives transactions through CME ClearPort.

Some "WACO" courtesy of CNBC

I just watched a guy on CNBC reporting from the floor of the CME. His badge read, “WACO,” but it should read, “WACKO,” because he was saying that Japan will “move to default” because it is running a trade deficit for the first time in 32 years.

And people think they’re getting informed by watching this stuff.

Unbelievable.

An open letter to the CME

Since MF Global was a clearing member of the CME it is likely that the CME knew about the firm's financial difficulties and its positions and did nothing about it.

Here is a pretty hard hitting letter written by someone named Warren Pollock:

Open Letter to the CME To: Terrence A Duffy, Chairman CME Group As illustrated by the failure of MF Global, I am of the opinion that, the CME has not met its basic obligations to the marketplace as a “public fiduciary.” Our society depends on “basic finance” to provide “utility function” such as banking, hedging, insurance, and/or capital formation. Presently, we have an “innovative system” that degrades the integrity needed for “basic finance” to perform as required in a well-structured economy. Worse yet, our “innovative” financial system impedes the effectiveness of the greater “physical economy.” The “physical economy,” consisting of all those individuals and entities tasked with meeting actual need. The "physical economy" consists of many of your customers including farmers, manufactures and electric companies. Our society needs people working in the "physical world" to create jobs more desperately than it needs the continuity of the CME. Must we endure another market catastrophe to figure this out? Read rest of the letter here.

Has the CME become more of a liability than an asset to our financial system? I am speaking here as a former member of the exchange.