CFTC Commissioner Bart Chilton Reveals "One Trader" Controls 40% Of Silver Market, As Silver Holdings Of SLV Hit All Time Record

After we reported a week ago that JPMorgan was trying to corner the copper market, many noted this was not surprising, considering the bank's comparable approach in manipulating various other precious metal markets. Naturally, we extrapolated that the main reason why the CFTC continues to refuse to delay implementation of position limits is precisely due to the JP Morgan's need to control commodity pricing precisely due to such manipulative trading practices: "As for the CFTC, we now know why they are so intent on delaying the size limit discussion:
after all, any regulation will be forward looking - better let JPM
accumulate all commodities it can and distribute these via hidden
channels to affiliated subs before the ever so busy Gary Gensler corrupt
cronies decide to raise their finger on what is increasingly an ever
more blatant market manipulation scheme. At least in this case, JPM will
push the price higher unlike what it is doing courtesy of its gold and
silver manipulation. However, the PM market (especially Asian accounts)
will soon make sure Blythe Masters is looking for a job within 3 months
as we predicted a few weeks ago." The only problem with this story is that so far, is that unlike copper, JP Morgan's now legendary paper short in the silver market, long taken for granted by the "less than in mainstream" community, has been persistently ignored by the broader media due to the a lack of concrete evidence. Hopefully that will now change: courtesy of a speech delivered by none other than the CFTC commissioner Bart Chilton, who continues to expose the CFTC and the banker cartel's illegal market manipulation practices, we now have proof that "one trader held over 40 percent of the silver market." As this trader is either JP Morgan directly, or various Blythe Masters proxies, we can only hope that finally the broader outcry against JPM's ongoing attempt to suppress precious metal prices (insert Mike Krieger/Max Keiser "Crush JP Morgan" campaign here) will force the bank to finally unwind its shorts. And if not, perhaps the market speculators will do it for them: as of Friday, the SLV ETF held an absolute record 10,941 tonnes of silver, an increase of 163 tonnes for the week.

What is even more amusing is that the Bart Chilton disclosure came during a speech blasting that other manipulative scourge of the market: High Frequency Trading (it is helpful that over a year after Zero Hedge first recognized HFT as the biggest threat to market stability, subsequently confirmed by the flash crash, now the very CFTC is finally confirming we have been right all along). In an ideal world, there would be an overhaul  to both position limit and HFT trading rules. Alas, we live in a world, in which the son of the heretofore biggest known ponzi, Bernie Madoff, has decided to take his own life on the two year anniversary of his father's ignominious collapse. Surely, should the regulators confirm that our own markets are nothing but a massive ponzi, the suicides will be far more pervasive, as all those who "trade the tape" realize they have been following the crowd right over the cliff.

First, here is a snapshot of (alleged) silver holdings in the SLV ETF, which many believe is a direct and indirect attempt by Asian banks to force a massive short covering capitulation by JP Morgan.

And here is the full December 8 speech by Bart Chilton. Relevant sections have been highlighted (h/t Bill Murhpy and LeMetropole).

“Speed”

Speech by Commissioner Bart Chilton before the High Frequency Trading World USA 2010 Conference, New York

December 8, 2010

Introduction

Good morning and thanks to Terrapinn, and especially Matt Bednarsky, for the kind invitation to speak with you today.

Today, I’m going to spend a few minutes talking about speed.  That
is, speed not only with regard to computers in trading but also to
regulation.  Together, we’re all going boldly where no man has gone
before.  I’ll also share with you a few of my thoughts about the
happenings and changes that are occurring in Washington that will impact
Wall Street and LaSalle Street and a bunch of people on streets that
not many folks have even heard about.

Streets With No Name

In fact, forget about Wall Street or LaSalle, it really doesn’t
matter the name of your street at all.  Many High Frequency Trading
(HFT) and other financial trading firms don’t even have offices in New
York or Chicago, let alone London, Hong Kong or Singapore.  If you have a
connection, you can trade, and trade they do.  A recent report says HFT
firms account for about 50 percent of European markets.  Our CFTC
economists say high frequency traders (HFTs) account for roughly a third
of all trading volume on regulated U.S. futures exchanges. 

HFT companies don’t even need traditional traders on staff.  The
types of professionals represented in today’s HFT firms might be more
suited for the deck of the starship Enterprise than a traditional
trading firm.  These are mathematicians, programmers and physicists. 
Moreover, with the advent of Star Trek-like “gee whiz” HFT technology,
we are witnessing one of the most game-changing and tumultuous shifts
we’ve ever seen in financial markets.  Is it being done correctly?  Are
there new rules or regulations that should be in place?  If so, who,
what and how should it all be done?  Those are some of the questions
being asked.

Many of you may recall from your television education that the Enterprise and other starships of the 24^th
century travelled at faster than light warp speeds using dilithium
crystals for power.  Today’s HFT firms are travelling at the same
superfast speeds in their bold quest to seek out new life and new
civilizations. Scratch that:  in their quest to scoop up market
micro-dollars in nanoseconds.  That makes this an exciting time and an
exhilarating environment in which to live.

Wall Street Reform

There are, however, many other fascinating changes taking place in
markets and in our economy.  That makes this all not only an
exhilarating, but also a challenging time.

Given the economic meltdown, which we saw in full force beginning in
2008, Congress saw the need to re-write financial laws.  In July,
Congress passed and the President signed the most sweeping financial
reform bill in history:  the Dodd-Frank Wall Street Reform and Consumer
Protection Act.

Dark to Light OTC Markets

If there is one chief concept behind the new law, it is
transparency.  In the futures world, the major change will be bringing
light and regulatory oversight to the over-the-counter (OTC) derivatives
market.  As you know, OTC markets are where those annoying credit
default swaps traded.  To give you an idea of how this increases the
regulatory universe, the currently CFTC-regulated exchanges account for
roughly $5 trillion in annualized trading.  The OTC market is roughly
$600 trillion.  We are going boldly where no regulator has gone before.
 To say the least, we have our work cut out for us.

Speculation and Position Limits

In addition to OTC markets, there is another key provision of real
significance required by the new law.  In the run-up to 2008, we saw an
enormous shift in speculative money coming into futures markets.  Over a
several year period, roughly $200 billion in speculative money came
into these markets.  Crude oil reached $147.27 a barrel; gasoline topped
$4 a gallon.  Wheat, which trades at roughly $8 a bushel these days,
was trading at $24.  It went on and on, and then it all crashed.

I’m not suggesting a direct correlation between the inflow of
speculative money or positions and the price volatility, by any means. 
Many of us learned, however, that while there may not be such a
thing as too much speculative money, that same money might be too
concentrated.  We saw very large concentrations of trader positions in
2008.  That has continued.  Since then, we saw one trader hold more than
20 percent of the crude oil market.  Even earlier this year, one trader
held over 40 percent of the silver market.

While I’m not suggesting speculators drove prices in 2008 or
today, I know they had an impact then and believe they are having some
impact today.  You don’t have to take it from me though.  Economists at
Oxford, Princeton and Rice universities all document that speculators
have had an impact on prices.

Congress got it, and that is why the new law requires mandatory
speculative position limits—to ensure that too much concentration
doesn’t exist.

Crude and Gas

News stories on front pages in recent days report the nearly 10-cent
surge in gasoline prices as a result of increased crude oil futures (by
the market close last Friday, the NYMEX price had risen nearly $7 to
$89.19 in the past two weeks). The same articles point out that crude
futures are somewhat delinked from supply and demand.  With strong
supply and relatively weak demand, one energy economist said, “There is
nothing a normal person would look at and come up with what’s
happened.”  Maybe we need to look again at the experts.  An April 2010
MIT study said that “. . . speculation may temporarily push crude oil
prices above the level justified by physical-market fundamentals . . .
.”

New Speculation Data

One might ask if there are as many speculative positions today as
there were in 2008.  If folks thought speculative levels were high then,
data I’m discussing for the first time today reveal an even greater
level.

Speculative money from the likes of hedge funds, index funds and
pension funds is coming into the commodity markets at a blistering
pace.  There are more of these speculative positions now than at any
time. To provide a more granular data look, between June of 2008 and
October of 2010, futures equivalent contracts held by these types of
speculators increased 47 percent in energy contracts, 20 percent in
metals and 18 percent in agricultural commodities.  More than $149
billion in speculative money in commodities markets represents more
futures contracts than at any previous time.  (Note: While the dollar
amount of speculative money was slightly higher in 2008 at $162
billion, the actual number of futures positions held by these
speculators was less due to the high cost of commodity contracts).

Not Bad Guys

Now, there is nothing whatsoever wrong with those speculators being
in markets. Bless them.  We need speculators.  Without them, there is no
market, full stop.  The sheer size, however, of concentrated
speculative interests has the potential of moving markets, of
influencing true price discovery.  That can make life difficult for the
hedgers who use markets to manage commercial business risks, and for
consumers who rely upon them to fairly price just about everything they
purchase.  Everything from a loaf of bread to a gallon of milk or gas to
a home mortgage is impacted by these markets.

So, where does that leave us?

Implementation

When Congress passed the new reform bill this past July, it
determined mandatory speculative position limits were required.  Of the
more than 40 rules that the CFTC is required to promulgate, most are
required to be completed by next July.  Only a few have shorter
deadlines.  Mandatory position limits are in that small group and are
required to be implemented by mid-January for energy and metals
contracts.

You may have read news stories recently where some say we can’t make
that deadline, shouldn’t make that deadline, need to hold off until we
get more data or better data so that the levels can be calculated with
exact specificity.  In an idyllic world, that might be fine.  Congress,
however,  gave the agency the earlier implementation date for a
reason—so that we put limits in place now, not some later time of our
choosing.  Additionally, the law provides no such authority for
regulators to delay the imposition of these limits.  There is no
regulatory escape valve.

That hasn’t, however, slowed some folks down.  There are creative
suggestions for ways around the implementation requirement.  Some
proffered that the agency formally approve a final rule and consider
that step as “implementation” under the law.  At the same time, the rule
would not make the limits effective until sometime in the
future.  They essentially propose the agency implement a rule on time
without implementing it on time—without making it effective.  If that
sounds convoluted, it is.  That sort of dancing on the head of a legal
pin is exactly the variety of Washington-speak that makes folks in our
country furious.  I’d also bet that those in Congress who wrote the
provision would have an opinion on the matter.

When President Obama signed the new law, he said the reforms
“represent the strongest consumer financial protections in history.”
 The mandatory position limits provision is one of those consumer
protections.  The CFTC has an obligation to do what Congress and the
President instructed us to do . . . and on time.

Speed

So, how might the new law have an effect on high frequency trading?  Does anyone remember the movie Speed?  It
is about 15 years old but still popular after all that time.  Sandra
Bullock plays a passenger on a bus wired with a bomb.  She is told the
bomb will trigger if the bus slows down to 50 miles-per-hour.  She winds
up having to drive the bus and negotiate curves, off-ramps and traffic,
all at a speed over 50 miles-per-hour.  Well, as I said, HFT is taking
place at warp speed. It is not ever going to slow down to 50
miles-per-hour.  Is warp speed okay?  Are there any negatives?  Does
that speed help markets?  At the very least, as regulators, we need to
keep up with what is going on.

Computer technology in trading is great for many reasons, not just
for the “gee whiz” things mentioned earlier, but because it can increase
liquidity in markets.  It adds access that we've never seen, and for
auditors, exchanges and regulators, it's great because electronic data
trails exist instead of trying to piece together pieces of papers from
trading rooms.  So, there are many good things about computer trading,
but we also have to think about the myriad ramifications of technology.

Flash Crash 

One such ramification gave us a wake-up call on May 6^th. 
 Financial markets came unwound that afternoon.  You’ve heard the horror
stories.  Stock in Accenture, for example, went from $40.13 to just a
penny before recovering.  The Dow lost nearly 1,000 points, and then
recovered more than two thirds of it by the close of trading.  If the
crash had occurred earlier that day, when European markets were still
open, the entire financial world would’ve been rocked. 

The report issued October 1^st by the staffs of the CFTC
and the SEC tells us what happened.  It doesn't point fingers at a
single culprit like some people think.  It describes markets that were
already jittery due to economic news coming out of Europe.  Volatility
was double normal levels, but liquidity was light.  Sellers couldn’t
find buyers.  Then when one firm utilized a trading program—not HFT, but
an algorithmic robot—to sell what would usually be a pretty ordinary
set of 75,000 S&P E-Mini futures contracts valued at over $4
billion, the markets went off a cliff.

HFT arbitrageurs and others, seeing that market plummet, recognized
an opportunity to buy low at one exchange and sell corresponding
contracts at a higher price elsewhere. That is one of the reasons we saw
the cascading effect within commodity and securities markets.   

The good news is that markets recovered much of the loss.  It’s also
good news that regulators and exchanges are instituting procedures to
make markets more effective and less susceptible to disruption. 

It may surprise some, but mini flash crashes occur all too often. 
They don’t cause as much of a disruption as that of May 6, but more than
once this year in futures markets and several times in individual
stocks, runaway robotic programs have disrupted markets.  By that I
mean, they cost people money.  In February, for example, one company
lost a million dollars in the oil market in less than a second. That
company lost its own money but sometimes whole markets are affected and
many innocent people are hurt. 

Police Department 

Things can happen so fast that, all too often, regulators are like
the fire department that comes in and cleans up the charred remains.  In
practice, we need to be more like the police department trying to keep
these disasters from happening in the first place.

As you know, these HFT programs and computers are not static.  They
are intuitive.  They can track market moves and make adjustments
accordingly.  They are extremely sensitive.  They play off one another
and react at nanosecond speeds. For regulators to keep up, we have to
somewhat get in the mind of the mainframe. We have to be nimble and
quick because even if we get a better handle on how to regulate this
breakneck speed trading, the methods, the machines and the markets will
continue to change.

TAC

At the first meeting of CFTC’s Technology Advisory Committee (TAC) in
July, some firms provided evidence that elements of the Flash Crash may
have been caused by so many orders going into the order book so fast
that the market couldn't respond.  One member of the committee called it
“algorithmic terrorism.” I call it algo price piracy, where one
algorithm “invades” another.  It doesn’t appear that happened May 6, but
I’m sure it can.  Some of our committee members who are knowledgeable
about this think it does.  It may be innocent or it may not be, but it
points out how regulators need the speed to keep up with an ever-faster
set of markets.

HFT Limits 

Given our experience with the Flash Crash and mini flash crashes, it
is appropriate to consider if there should be limits on high frequency
trading.  For example, we were talking about position limits earlier. 
Say we allow 10 percent of open interest in a market.  Should high
frequency traders be allowed to trade 10 percent, repeatedly, in a very
short time period?  We certainly should not allow some situations to
exist.  What about five HFTs, each trading 10 percent of the market in
ten minutes, in concert, and it moves a market?  Is that okay?

Purpose of Markets

That issue, however, raises the broader question about this type of
trading in general.  Don’t get me wrong, HFT trading is part of our
trading today but should it remain the same?  Is this type of trading
outside of—or is it even inimical to—the fundamental purposes of capital
formation and risk management in these markets?  Many commercial firms
trying to hedge their risks complain about the inability to get into the
markets as they have in the past due to sheer number and speed of
HFTs.  I understand there are arguments on both sides, but if we lose
the commercials, we won’t have the types of markets we need to ensure
price discovery and appropriate risk management.

Unstoppable and Accountability

Another way to address some of these potential circumstances is to
impose legal responsibility on high frequency and algo robot trading
that roils markets.  I saw Denzel Washington in the movie Unstoppable
over the weekend.  He was great, as usual.  As this runaway train
travelled at high speeds across Pennsylvania, I thought about
accountability.  The train company was constantly calculating the costs
of what action to take.  Do they try to derail the train in a remote
area where an accident will cost them less money?  Should they try to
stop it by putting people on the train and risk lives?  It struck me
that the reason the company thought about those things was that there
are laws that will hold them accountable.  Shouldn’t we do the same for
algo robots and HFTs?  Those who instigate runaway high frequency or
algo robot trades should be held accountable when they hurt other market
participants or injure consumers.

One way to address the matter is to include such a provision in our
new anti-disruptive trading practices authority.  We should prohibit
certain conduct that is specific to algo robots and high frequency
trading.  Taking into account what happened on May 6, this certainly
seems like a reasonable proposition. 

Seal of Approval

I believe, and think there are others at the Commission who would
agree, there should be some standard definition of what high frequency
trading is and maybe even a kind of “Good Housekeeping Seal of
Approval.”  Should that be done?  If so, who should do it?  I’d
certainly like to ensure as part of our core principles that exchanges
have certain due diligence and HFT is vetted from the start.  I’d also
like to ensure that all exchanges have the ability to monitor individual
programs trading and aggregate and slice, dice and chop up data to get a
better handle on what is and could go on in market.

Deep Breath

I know a little of this might sound scary to some of you. 
Nevertheless, take a deep breath.  First, I’m always candid and we don’t
get to good or bad ideas without talking about them.  In fact, I hope
you will help us as we consider what to do so that we don’t make
mistakes.  Without your participation, we could do a lot of damage.  I
get that.  Second, remember that good people shouldn’t fear appropriate
rules or regulations.  The bad actors should fear rules and regulations.
Third, we have a big thing in common: we all want markets that are
efficient, effective and free of fraud, abuse and manipulation. 

NASCAR 

We may not have this in common, but I know there are many NASCAR fans
in this country.  Even if you are not, it is cool to see those cars go
really fast.  Folks love to watch somebody take the checkered flag.  And
admit it, sometimes we like to see a crash.  However, we don’t want
anybody to get hurt.  We certainly don’t want innocent bystanders in the
grandstand to get hurt. 

The same is true in markets.  Folks want high frequency trading
because of its advantages.  What nobody wants is for anybody to get hurt
because of unintended consequences, including traders themselves. 
Therefore, whether you’re driving around a NASCAR track, on a starship,
in a train, or on a bus, it’s the regulators’ job to prevent accidents
from happening.

Pinto

If you remember the original “Speed,” somebody asks Sandra Bullock if
she thinks she can drive the bus and she says, “Oh yeah, it’s just like
driving a big Pinto.”  I’m not sure if our job is as easy as driving a
Pinto, and that’s the first car I learned to drive, but I am sure
working together, we can get the job done.  We just have to be careful
and watch our speed.

Thank you.  Happy Holidays.  Live long

Comments

[Careless Whisper]

maybe Super Silver Haze is the way to go

http://laist.com/2007/11/04/weed_review_sup.php

[New World Chaos]

Hey reefer, check out the silver Liberty Leaf: https://www.libertyleaf.com/

Soon you will be able to buy an ounce of BC Bud with one of these.

[Biggus Dickus Jr.]

Ok all together now pray with me. Silver is going Down. silver is going down please god make silver hit 24 I promise to start going to.church and give alms to the poor.

[EscapeKey]

I don't get it. Is begging the latest "angle" of getting the ZH crowd on board? It ain't gonna happen. The posters here have by and large told everyone and their dog to get physical for ages. We've had one shill after another come on here, tried to "influence the crowd", only then to disappear a few weeks later, never to be heard of again.

Go long, and go long physical.

[A_MacLaren]

EscapeKey - BD Jr is a new formation "participant" at ZH.  The profile is only 1 week and a few odd days old.  Based upon the spray of comment on the social inequality thread, including ad hominem attacks and posts, intentionally inflamatory/instigatory remarks, and other comments clearly aimed a division and derision, It appears to be a troll

[A_MacLaren]

Ok all together now pray with me. Silver is going Down. silver is going down please god make silver hit 24 I promise to start going to.church and give alms to the poor.

http://www.zerohedge.com/article/november-budget-deficit-1504-billion-wo...

by Biggus Dickus Jr.
on Fri, 12/10/2010 - 14:52
#796629

the difficulty is picking out the best ideas.  But complaining about the unfairness of it all does no good.  That's all I'm trying to say.  Complaining and anger just robs you of the dispassion you need to invest.  I've been a silver bull for a decade now.  Still am.

[Kaiser Sousa]

Chilton  needs to stop beating around the bushes trying to shame those other assholes at the CFTC n 2 taking action against their banker masters cause they aint gonna do it...Each day he refuses to unequivocally disclose the manipulation, and specifically detail the manipulators he is complicit n the financial destruction or harm of all those who have accumulated the only 2 forms of real money...His credibility and integrity r n doubt until that moment....

[Arius]

easier said than done...only markets will take care of these things...no official has the balls to correct it, otherwise it would have been done long time ago...

reading what chilton had to say though, we might be approaching the finish line...

[Saxxon]

The major U.S. banks are like SkyNet.  They are running the circus.  Their arrogance is astonishing.

You remember when that insect Hank Paulson was pleading with his TV viewers to support the bailout 'so that your childen can get the loans to go to college' et cetera.  That was the tell.  He was essentially saying, "we are not leeches, we are not parasites and cancers. You need us."

[jules from aus]

err... it is against the law for him to release the details of who holds what positions - only a Federal indictment can provide that detail, and his earlier comments back in Octoer (if I remember) said that prosecutors are already on the case- so stop trashihg the guy - he is the only commissioner who has bothered to say anything on this issue, where his comments on the short positions are not in fact the CFTC's official views - it takes at least 3 Commissioners to endorse an official view of the CFTC, but on this issue of Silver manipulation he is the only Commissioner prepared to put a statement, so he is (bravely) alone within the CFTC at the moment with his comments

good luck

[vainamoinen]

A guy named "Bart" talking about NASCAR, Ford Pintos and second rate Sandra Bullock movies - and this passes for some kind of financial analysis?

And he's in some kind of position of authority?

Cheesus K. Reist!

Only in Amerika - - -  

[Ludwig Van]

Actually I thought his presentation was well structured, thoughtful, and colorfully illustrated. Impressive really. Good tooth talk, but none bared.

[Quixotic_Not]

Commodity warz biotches!

[Biggus Dickus Jr.]

Yeah I'm afraid I switched sides too soon but I will come back to the forces of light if I find a good entry point. Ok god 25. Because 24 is a bit greedy.

[chopper read]

you'll be lucky to see 27.

[unum mountaineer]

I'm thinking there will be a drop going into january. i'm just keeping some extra fun bux on hand in ye ol' checking account. apmex has some generic 5 oz. and general bars and rounds..might be a lil scratched, etc. but some silver is better than none imho.

[Kali]

Someone educate me here.  I have problems with the statement "we need speculators".  In commodities?  I have always thought should be limited to people who actually take delivery of said commodities.  The other FIRE stuff, I could give a rat's ass about, but commodities are the "stuff" of life.  Why would speculators in commodities benefit anyone but the speculators and brokers?  The very parasites of that system?  I am just a lowly engineer who actually produces real things, so am not hip to these things.

[Lord Koos]

Speculation in food commodities causes hunger and starvation in many parts of the world.  It should be limited to people that actually plan to take delivery of said commodities.

[chopper read]

speculators assume risk, and should be compensated for this.  if a wheat seller wishes to enter into a contract today, but there are no wheat buyers today, then a speculator matches the other side of the trade and waits until a wheat buyer arrives on another day in the future.  in the interim, the speculator is subject to price swings.  however, without this speculator there is no market today, just emptiness which does not allow today's wheat seller to reduce his/her exposure to seasonal price swings.  

i admit, there is a balance that is optimal, meaning: sometimes speculators are compensated too much for this risk.  however, with no speculators, there is no liquidity for those who wish to lay off risk today.  Never forget, many speculators cannibalize each other for no extra charge. 

[Kali]

Another question: what if no future buyer shows up for speculator?  Does he take delivery?  The wheat seller already got his money and shipped the stuff to the speculator? Or does the wheat seller get burned by the speculator, meaning the wheat seller gets stuck with product AND no money?  Sorry I am very ignorant on commodities trading.  Something I need to get more educated on.

[chopper read]

the speculator who does not wish to take delivery on the wheat must close out the position with a 'short' trade themselves.  Eventually, every speculator closes out except the one who is opposite the actual wheat seller (farmer).  At this point, they must take delivery.  However, if they enter as a seller in the next month's contract, then they need only finance the cost of storage for one month before they can unload the wheat to a cereal maker, for example, or some other long-term buyer.  If the difference between the buying and selling price is greater than the 'cost of carry' in storing the wheat, then the speculator gets paid for the risk.  If the cost of carry is greater than the difference between the monthly buy/sell spread, then there is a loss.  Since most speculators in the futures markets are not usually equipped to take delivery, they lose out to those deep-pocketed speculators who are prepared to take delivery, even if are only holding the wheat for a month or two.  

[Kali]

Thanks chopper.  Any thoughts on a good read to learn about commodities trading?

[chopper read]

Trading From Your Gut, by Curtis Faith. 

http://blog.traderslibrary.com/traders-library/2010/01/trading-from-your...

[Thanatos]

Thanks man!

I appreciate the schooling.

[TheProphet]

Speculators are helpful in that they can serve a 'canary in the coalmine' role.

What is needed is transparency and and reasonable controls. It seems to be what they are attempting... though I am guessing the devil is in the details.

[XPolemic]

Just to add to Chopper's excellent comment, what speculators do is add liquidity to the market. Illiquid markets are, to be blunt, useless. The point of a market is to trade something you have, for something you want. If no one is willing to trade with you (i.e. the market is illiquid), then the market is of no use to you.

In addition to liquidity, speculators spread the risks over many more participants. This means that losses can be mitigated by spreading them amongst many participants. A coffee producer may produce 100 tonnes of coffee. That is a lot of price risk for a single entity to take on. By having many speculators in the market, they can each carry the risk (and the associated returns) on a fraction of that amount (say 1 tonne of coffee each). The positions that speculators take are usually 'cash settled', that is, the profit/loss is settled in cash (usually to/from a margin account), and the final buyer takes delivery of the physical commodity (for perishables), or the commodity never moves from it's vault (such as precious metals), and only the beneficiary owner changes.

At any given time, there will nearly always be more open positions (long or short) than their is physical commodity to deliver. Because most contracts are cash settled, this usually isn't a problem, but buyers of long positions CAN demand physical delivery, which forces the price up as there is a mad rush of open positions chasing too little physical underlying. The Hunt Brothers attempt to corner the silver market is the most famous example of this (until the exchange suspended trading and allowed those who were short to cash settle and then they fined the Hunt Brothers).

So speculators add liquidity and risk minimization to markets, both of which make markets more useful for producers of commodities, and allows more producers to enter the market by allowing them to reduce their future price risk. This allows producers of commodities to forward plan debt repayments and other costs of running their business, while guaranteeing a price for what they produce.

It's not speculators that destroy markets, only corruption and collusion between large traders and the regulators who oversee the market to ensure that the market is transparent and operating efficiently.

[Goldenballs]

Anybody noticing ZH taking a fair amount of time to come up at the moment is it being hacked ?

[Thanatos]

Hacked? No.

Maybe sprayed with a firehose of spoofed tcp/ip packets (ddos), but not hacked.

ddos = Denial of Service. That is the goal, denial by flood of junk.

Really impressive (when i was 13)

How does it work? Here is a simple example.

They spoof (trick) a ping request to look like it came from ZH. They broadcast that request for ping response to many, many computers... Like millions if possible. All the computers that get the ping response request say "i better respond" and they do. Millions of them respond all at once to that one IP addy that is ZH. Viola... All clogged up. Nobody get through.

Easy as pie.

These guys are using a "Bot Net" army of zombie computers to perform a similar task. They are not using (just) Ping (ICMP). They are using malformed http requests agaisnt web servers, and likely attacking routers and mail systems using the appropriate tools/mechanisms as well.

This is not a "Spectre" type operation... These are NOT top shelf hackers. This is just farm leagues.

When the big boys come out to play, it will go dark fast.

[Ricky Bobby]

+1

[Thanatos]

When they start poisoning secure DNS Caches, dropping big SQL DBs at banks, worming into AMLAW top 25 SANs, whacking microwave and fiber trunks and fucking with routing protocols, you know you are dealing with the big leagues.

Till then.... Yawn. Muppets are storming the gates! Go back to sleep baby...

Keep this IP handy... If the DNSs get poisoned you can still use ZH... Just use the IP.

http://188.126.66.66

http://188.126.66.68

Non-authoritative answer:
Name:    zerohedge.com
Addresses:  188.126.66.68
          188.126.66.66

Looks like ZH uses round robin DNS to keep loads balanced across (virtual, id guess) boxen.

Good fer them.

[Seer]

Yikes!  All those sixes!

[Saxxon]

+6

[Goldenballs]

So who,s resposible for this shit the,JP Fraudulent PLC or Johnny Bravo and his arse wipes ?

[Goldenballs]

So who,s resposible for this shit the,JP Fraudulent PLC or Johnny Bravo and his arse wipes ?

[Thanatos]

It fucking useful idiot Muppets helping scare the shit out of all the Geezers in congress before the FCC rules vote.

I have no idea who is behind it.

If you extrapolate who will benefit, I'd say they are in the following order:

MIC (Military Industrail Complex)

Politicians / Mass Media tied for 2nd.

The timing is important, the unmoderated internet has become a festering sore for the MSM, Politicians and All brokers of True Power.

They population of outspoken critics on the web is small but going "parabolic" on them. They are gonna try to head it off at the pass.

If they get a restrictive ruleset passed and implement it...

Then you get to see some "real" hackers go to work. It won't be exiting, it will SUCK. Nothing you need to make life easy will work.

You wont get cable tv, long distance phone service (and maybe not local either), Internet will be toast.

They can shut down your power plant too... Not just turn it off, but blow it to pieces.

http://articles.cnn.com/2007-09-26/us/power.at.risk_1_generator-cyber-at...

People are not nearly as clever as they think themselves to be... So be careful what you ask for... You might really regret it once you possess it.

[Seer]

Yeah, FCC...  Consider that big corporations are wanting their own dedicated network(s) and one can clearly see why the storm clouds.

[Thanatos]

Here is a little sample of what you can expect when things get "for real".

http://www.sfgate.com/cgi-bin/blogs/abraham/detail?entry_id=38311

[Thanatos]

Anyone who thinks the public will rid themselves of the criminal cancer without EXTREME suffering is deluded.

The Chemo that will get rid of the Cancer will make most wish for death. There isn't an "easy" way out... Never was.

[Vendetta]

I agree totally.

[cranky-old-geezer]

The only possible "easy way out" is stop pursuing the problem from the curing end and start pursuing it from the causing end, i.e. identify the cause(s) and eliminate them. 

Eliminating cause(s) is way less painful than applying cures ...which ultimately fail if causes aren't eliminated.

[Bolweevil]

"Correct the cause."

[Saxxon]

I like your style, Thanatos.  We hope you will stay around for a while.

[Thanatos]

Thanks Saxxon,

It took me 6 months to get past TD and that Captcha of his... So I should be sticking around for a while to cost average my efforts.

To me, ZH is why Freedom on the Internet is important. Free Exchange of ideas... Uncensored except by peer review. Then only censured.

I continue to learn a great deal reading here at ZH and I hope to continue that for a long time.

Regards,

Thanatos

BTW: those IP's I gave are US based... That server can go down in the event of US lockup.

Here is the IP addy for the Swiss server...

http://208.68.139.38

Non-authoritative answer:
Name:    zerohedge.ch
Address:  208.68.139.38

[A_MacLaren]

Thanks for the IP address.  My attempt to use it failed.  So I went to:

http://www.ip-adress.com/whois/208.68.139.38 and it didn't give me what I was expecting...

Ditto results here: http://webyield.net/domainquery.html

[Thanatos]

One more useful tool for you:

http://www.radioreference.com/apps/audio/

Live police, fire, ems feeds from all over the US via the web.

Probably one for your area.

It might help you to keep up with events in your area if the need arises.

[Clycntct]

clk reply and 4 seconds to pull up the comment.

[jfms99]

The Hunt Brothers in Silver and Jay Gould and Jim Fiske in Gold, all learned the hard way you cannot control those markets.

JP Morgan Chase will learn to and end up bringing down the Money Center banks with them when this blows up in their faces.

[JLee2027]

Good point.

[dark pools of soros]

Blythe was such a normal hobgoblin of a girl...

"Blythe has gained a reputation for being opinionated and outspoken--and most of the time she is "right." This pattern started early on: "I remember that my father didn't want me to wear slacks to church. Despite my objections, I agreed to wear a skirt. But I wagered a small bet with him that other women would be wearing slacks on Sunday, and if that were the case I would get a dollar for each one I could spot. He took me on, and I not only won the bet, but some money too!"

I wonder if she wagered her Dad if other women at church have a penis like she has

[dark pools of soros]

she's ready to whip every piece of silver outta your weak hides

http://nymag.com/daily/intel/2010/08/jp_morgans_blythe_masters_will.html

[apberusdisvet]

Hey Tyler; send her a ZH dildo, with the Banzai7 cosmic vibrator.

[tony bonn]

"SLV ETF held an absolute record 10,941 tonnes of silver,"

that i'd like to see....i would be surprised if they held even 50% of that amount....

and how much of the silver market did the hunt brothers hold before the government mafia broke up that affair? they were only doing what the banksters were doing...

i seriously doubt madoff hung himself...i believe that the cia was cleaning up an operation which had outlived its usefulness.....

[delacroix]

that slv money is being used to short the market, they'ry not buying inventory.  they're scrambling to settle delivery contracts. there's no extra silver for SLV. my local coin shops (3) had only  29 generic oz's last week, had to buy a few silver eagles, and a philharmonic.  this week all they had was 20 mexican oz's, that just came in. seems like the supply is drying up. they had buckets half full last year.

[THE DORK OF CORK]

CoinInvest.com is refusing to ship silver to some or all Euro countries until January 1 citing EU Vat  rules.

                    "This item is not available for shipment to the selected ship to destination. For the current year we have reached the limit of VAT liable goods as per Article 34 of EC directive 2006/112/EC, VAT directive. Sales will be resumed in on January 1^st of next calendar year. Please chose a different ship to destination."

I have not checked all Euro countries but Ireland , Finland and Belgium have all reached such a limit.

It seems that the Euro area is very Gold friendly but hates silver for some reason.

[DCon]

They delivered 20 Philarmonics to me on Thursday.

Good thing I am not living in Ireland no more.

They have not been delivering to Ireland for several months

because of the VAT restrictions.

As there is no VAT charged on Gold, and hence

no VAT restricions, I assume this is why Europe

appears more Gold friendly.

[EscapeKey]

OI, slave, can you get your arse back to Ireland and work to pay off the bankers debt, like a good citizen?

[LeBalance]

I do not understand the discussion of SLV as if its fictional holdings were anything other than a silver short.  SLV ounces are an inflation of the amount of existing silver as SLV creates fictional ounces without entering the market and sequestering any physical.

This action suppressed the "price" of silver.

It is just that simple.  And I thank FOFOA and his ancestors for that understanding.

[greenewave]

If you don’t like getting SCREWED by the Federal Government, then WATCH the YouTube video “OBAMA DOUBLESPEAK, More Lies, Tax Breaks for the Mega-Rich :)” at (http://www.youtube.com/watch?v=_CLiyb7LnCw).

God Bless Wall Street Crooks and the Political Inept!! It’s like “Corky” Runs the Country from the TV show Life Goes On!

[kalum]

Gun training class monday

[spinone]

remember, having a gun doesn't make you able to protect yourself any more than having a piano makes you a piaist.  Get good training, practice and drill.  Multiple targets, move and shoot, down but not out drills.

[dark pools of soros]

farmers and organizers (usually churches) are what survives when society breaks down...  you running around shooting is just flash paper..  a tale to be told a few times at the dinner table or the camp fire

[rlouis]

A little side note on custodians of allocated silver:  a friend of mine has held allocated silver bullion through Everbank as a way to trade physical when/if the price apreciates to his targets.  The other day he called and asked who the custodian was.  The person he spoke with wouldn't tell him who the custodian is for "security purposes".  They know he has the account, and custodians have lots of locations, so what friggin "security purpose" could there be? As a born-again skeptic, this just seems slightly questionable. I'm curious to find out how their delivery of physical works out.

On the flip side, my 30 or 40 pound sack of semi-copper pennies might appreciate pretty nicely if JPM tries to hedge their silver disaster with copper (although I don't think it will work ;). Sometimes it pays to be lazy! 

[delacroix]

nickels are the only coin worth more than face value. 6.3 cents

[TheSettler]

1909-1982 Cent (95% copper) * $0.01 $0.0270428 270.42% 1946-2010 Nickel $0.05 $0.0638451 127.69%

[CitizenPete]

Metal value is certainly one way to determine its worth.

The Fed pays full face value for U.S. Mint coins (including dollars). That puts $0.88 after material and minting overhead costs per dollar into the kitty.  Pursuant to the Public Enterprise Fund (PEF) the U.S. Mint moves seigniorage (profit) after costs and puts  it back into the US General Fund toward the debt.

So all Mint coins are worth more than paper and credit to you and me irregardless of the material they are made from. 

[honestann]

[oxymoron alert]: Yes, and Everbank is supposed to be "one of the good guys" in banking... if that's not a contradiction in terms.  I've had problems with them lately too.

The time has come for all good, honest, productive people to convert every last piece of paper they have into real, physical silver and gold in their possession.

We cannot trust  ANY  fictitious entity any longer.

[RobotTrader]

Anybody got a picture of Blythe Masters?

I think I found it....  LOL...

[Sean7k]

Hilarious. I only hope blythe reads this site...

[Ludwig Van]

Thank you, 'Bot. Your chicky pix always do it for me.

[cosmictrainwreck]

Robo looking to score points with the radical right (left?) on ZH....how long has he known who Blythe is?

[Captain Benny]

What an ugly beast she is... Wonder what her tramp stamp says....

[geminiRX]

Smoking is glamorous

[Joe Grannville]

"Where's your gold now Moses?"

-Edward G. in the Ten Commandments.

[TexDenim]

So, how might the new law have an effect on high frequency trading?  Does anyone remember the movie Speed? 

I can't believe he actually included this BS about the movie Speed. Are these CFTC guys for real? What a crock of shit.

[thetruth]

that is just a wonderful picture.  someone should say it

[Coldfire]

I was going to lay in with some high-horse dudgeon about position limits and whether the leverage laid on the assclowns pretending to regulate the commodity markets was of the live girl or dead boy variety. But after reading dark pool of soros and WB7 comments on Blythe Masters I thought, hey, wait a second. This penis woman has enough fatal conceit to take the JPMorgue all the way. To dead. So to hell with any pretense of position limits in this clown market, buy physical silver and keep a good thought.

[Goldenballs]

Forgot to add,

Buy Silver,take down a bank,its your Patriotic duty.

[israhole]

Crush the bastidges!

[Stuck on Zero]

The Wall Street boys are soon going to realize that they don't control the price of gold, silver or copper any more.  China and India are like black holes for these metals.  They will continue to buy at every little retrenchment to support the monotonic rise in prices ad nauseum. 

[StychoKiller]

Ride the Whipsaw!  Fun for all ages!  Hey you, with the face:  ride the Whipsaw -- it's got chills, thrills and spills, only 1 silver dime per rider!  Hurry, hurry -- step right this way...

[QEsucks]

@trader joe. have only dealt with Tulving since 2008. Zero problems. You wire. They send. No delays. No problems. Lowest premiums over spot. Only problem as others have pointed out that minimums 20K.

[traderjoe]

Thanks. Maybe I'll give 'em a try. Cheers...

[Bastiat]

Bang Dae-Ho!

[CitizenPete]

Crash

JP Morgan

Buy

Silver

[Fred C Dobbs]

Hello zerohedgers.  I have been a daily reader for about a year.  I love this place and have contributed money to the site.  I bought DBS, GLD and SLV years ago before I knew what was behind them.  I now know I should have bought the actual metal as has been stated here numerous times.  My question is what would you do with this position and when would you do it?  Also can someone tell me for sure what will be the tax rate when I sell?  I have read many different explanations on the web.  

DBS $13179 up 152%

GLD $17603 up 76%

SLV $14045 up 109%

I also own a much more than the above in miners and have a little physical, 8 ounces  of gold and 1100 of silver.  I have to leave now to get to my local coin shop to buy more.  I will be back soon.  Would love to hear from the experts on this.  Thanks to all.  

[Quinvarius]

Wait for Ron Paul to take charge of Fed oversight and Monetary policy next year.  He will push the gold as money act.  Maybe you won't have to pay any taxes on gold at all.

[Clint Liquor]

JFK issued an Executive Order for the US Treasury to begin printing 'Silver Certificates'. Three months later he was pushing up daisies. Good Luck RP.

[cosmictrainwreck]

amazing "coincidence" weren't that?

[Bagbalm]

Same with Lincoln - he issued greenbacks and the next thing you know somebody is poking a pistol in his ear...

[PrDtR]

He was dead 1 week after promising to open up the floodgates of information that the "secret societies" wished to keep hidden..

I believe his speeches seemed to suggest that there were wicked deeds going on in "High Places"..

Black OPs projects, UFOs etc.

[Fred C Dobbs]

Thanks Quinvarius, I never thought of that one.   

[Quinvarius]

So was this one guy long or short?  I looked at the situation.  40% means 40% of the OI, not 40% of the inventory.  The OI is always much more huge than the inventory.  And the numbers for 40% only comfortably fits in the commercial short interest.  There is no 40% in any single long category.  So it was a 40% holder of short contracts IMO.  I thought maybe it was Sprott's long at first.  But there was no drawdown of inventory of that size, and Sprott takes delivery.

[jules from aus]

reposting this again... - i first posted (very late) to the Sprott piece of last week

_______________________

It is worth spending some time looking at the data on the Commodity Futures Trading Commission (CFTC) website, spcifically the end of month reports on the Futures Market.

I noted all the % monthly changes in long and short positions for both Non-Commercial and Commercial Traders.

Non-Commercial Traders (NCTs) are defined as those who "do not own the underlying asset or its financial equivalent; they hold only positions in futures (or options) contracts." - correct me if I am wrong, but JPM and HSBC would be NCTs.

Commercial Traders (CTs) are defined as those who " hold positions in both the underlying commodity and in the futures (or options) contracts on that commodity", and "who use futures or option contracts in a given commodity for hedging purposes, as defined in CFTC regulations." - this group would therefore have a lot of PM producers and those who actually deal in the physical metal, like a bullion dealer - while JPM/HSBC et all might hold a little of the physical stuff to qualify under this banner too.

Now insofar as Silver is concerned, the CFTC data shows the following for 2010:-

a) Using January as 100 - through to the end of November 2010, the net LONG positions of CTs INCREASED by 2.7%

--- through to the end of November 2010, the net SHORT position of CTs DECREASED by 5%.

b) Using January as 100 - through to the end of November 2010, the net LONG positions of NCTs (JPM&HSBC et al) INCREASED 36%

--- through to the end of November 2010, the net SHORT position of NCTs (JPM&HSBC et al) INCREASED 49%

((NB: I looked at the data of end-of-month positions for 10 months to the end of November. One interesting stat I have not yet been able to reconcile is that for the entire period, the end-of-month net position for CTs was always SHORT, and the end-of-month net position for NCTs was always LONG - whether much position changing occured in the final days of each month to always maintain these net positions I do not know, but they clearly appear (intuitively) to be at odds with the entire net growth/decline position after 10 months of data, especially for the NCTs - so I invite comment on this issue - but perhaps the easiest conclusion is the best namely, the NCTs have always maintained net LONG positions, because knowing the market has been purposefully held down, then one day it could only 'pop' to where it should, therefore the NCTs have also been holding the opposite side to their efforts at SHORTING, awaiting the day the SHORTS stop piling back in, thereby making a killing on their LONG positions in the process - but who really knows at the moment - though I am reminded of how GS were revealed to have betted on the failure of so many of the mortgage backed products they flogged to unsuspecting buyers...))

Some quick observations and conclusions:

a) NCTs are playing the COMEX hard in Silver, clearly throwing a lot more cash behind a lot more short and long contracts than CTs.

b) Despite the Nalven lawsuit brought against JPM and HSBC, NCTs are still piling on the SHORT positions, having in fact increased their net SHORT positions as a group since the lawsuit was filed.

c) The Nalven lawsuit against JPM & HSBC was filed on 2 November 2010 - at paragraph 43 of the Complaint it states, in effect, that 'as of 19 October 2010, less than four market players hold 24.3% of all SHORT bets in the Silver market, where JPM and HSBC are among those participants.'

d) Sprott in his November article (All that Glitters is Silver) states that there are approximately 684 million ounces of Silver available for sale -- he then states that 'open interest' Silver contracts on COMEX represent approximately 871 million ounces of Silver -- therefore Sprott is suggesting a shortfall of some 187 million ounces that would go un-covered were physical delivery called for.

e) Now when you look at c) and d) above, and being very 'back of the envelope', we can conclude that in nominal (approximate) terms, that collectively JPM & HSBC are on the hook for about 212 million of those 'open interest' ounces of Silver -- a dollar figure for that quantity is about $5.9 billion bucks.

f) Now in light of the shortfall of 187 million ounces, and there being no immediately available information to suggest that either JPM and/or HSBC are in fact holding anything like 212 million ounces of Silver, then even if it turns out they own a little bit of that Silver, there nonetheless remains a few BILLION dollars that may be in need of covering - to which I say OUCH!

I'll let the rest of you to come up with further observations and conclusions.

Good luck

[chopper read]

great research, jules.  well done.  thank you. 

[honestann]

Unfortunately, a few billion dollars is nothing when the FederalReserve will happily cover your losses.  Just imagine how much leverage the FederalReserve gets for a few billion dollars in this way!  By holding down the price of silver [and gold], they probably boosts the "value" of the dollar by 10% (at least).  Given the astronomical quantity of purchases made every year in the dollar (let's guess $100-trillion), a fake boost in purchasing power of 10% is $10-trillion.  So they increase purchasing power of their absolutely worthless fiat, fake, fraud, fiction, fantasy, fractional-reserve debt toilet paper by $10-trillion... at a cost of a few billion (which they create at zero cost, no less)?  What a deal!

[Dr. Gonzo]

ordering 200 silver Keisers tomorrow.

[Impotent_Smurf]

I've converted all my silver into 1 once legos, and I'm gonna stack them to resemble the great wall of China.

[Client 9]

Read this zombies:

The case against gold

http://www.theglobeandmail.com/globe-investor/the-case-against-gold/arti...

[Quinvarius]

Gold is the baseline money.  Wait for it to run over $5000 where it belongs before doing something ignorant. 

[Dr. Gonzo]

Is that the best you got? I was buying gold when it was under $400. I'd buy more of it now if silver wasn't still such a great bargin. Think silver is high at $28? Think again. Palladium is at $730...in a recession! We need silver in a high tech world just as much as we need Palladium in an Industrial world. Silver to $90 in 3 years!!! When it hits $100 all the poor people will be saying. Wow. I could have bought 10 monster boxes in 2001 but instead I bought a new Chevy Silverado. Since then the company went broke and my truck is in the junkyard. I could have been sitting on over 1/2 a million dollars if I wasn't so stupid.

[honestann]

Exactly!

If humans weren't such morons, we'd all be happy.

Unfortunately, if a majority of humans are morons, the predators-that-be can enslave those of us who are honest, productive, non-morons... because we are in the minority, surrounded by the predators-class above us (who produce nothing, but control everyone), and the leech-class below us (who produce nothing, but vote for the predators who steal our wealth and give bits and pieces to the leeches).

What we need is many fewer Chevy Silvarados, and more basements chock full of silver and gold bricks.

[chopper read]

i read the article.  it was really bad.  please, stop posting complete populist dogshit for the benefit of the International Banking Cartel.  thank you in advance. 

http://www.zerohedge.com/forum/fiat-paper-bubble-run-your-lives

http://www.zerohedge.com/forum/plot-enslave-you

[hudson]

Quick Question, I'm 100% disable vet on fixed income. I have a mortgage but otherwise debt free. I started buying physical silver @ $11.00 have and buy around a $100.00 every month. Should I focus on buying extra silver or paying off my mortgage or split between the 2? I have about $250.00 per month to dedicate to either cause.

I'm well armed, have a year of food already done.

[Dr. Gonzo]

Pay off your mortgage. They can take your house away from you. They are going to take away a lot of people's houses from them as soon as it becomes more profitable for them to do so.

[Threeggg]

I wouldnt pay off the house, problem being that will be the next thing - Property Tax increases.

How will you negotiate your taxes if your house is paid off. ? 

Afterall you are going to have to pay your townships bills and with all the foreclosures going on and all.  well ? 

[dark pools of soros]

reverse mortgage of course!!!!   after the double HELOCs first

[apberusdisvet]

If, and only if we get serious inflation, your mortgage will be paid off will fewer and fewer coins, or oz.  Just keep buying silver. I would love to see the banksters face when you rade a fistful of coins for your mortgage balance.

[apberusdisvet]

If, and only if we get serious inflation, your mortgage will be paid off will fewer and fewer coins, or oz.  Just keep buying silver. I would love to see the banksters face when you trade a fistful of coins for your mortgage note.

[max2205]

Like the police, the regulators job is to investigate and make reports AFTER THE CRIME takes place. GL all

[whether underground]

"And virtually all the boys on "Fast Money" the last two days have been aggressively shorting silver."

No more bullish indicator than that...what were the girls doing?

[Rick Masters]

I've always been big on silver. If you want my witty approach on it all go here: http://echonomica.blogspot.com/2010/12/silver-brick-road.html

[A_S]

hi guys

I own spot silver from the london exchange in a derivate. Is this save paper silver for the comming year? Afterwards i change it for physical but now i want the leverage.

big thx !

[honestann]

Almost certainly you will never be able to receive physical silver.  They simply do not have it.

However, they'll probably be happy to let you settle your contracts for fiat, fake, fraud, fiction, fantasy, fractional-reserve debt-currency.  Just hope you can find someone willing to accept it at that point.

In other words, get out early!

[A_S]

No, i can't ask for delivery with this deriviative.

But i'll watch out, i'm allready buying up coins and i have mines too.

[cranky-old-geezer]

This speech, along with CFTC efforts to refrom markets, are a complete waste of time.  They are owned by Wall Street just like the rest of government is owned by Wall Street. 

Nothing of any significance is going to change, except in Wall Street's favor of course.  People should know that by now.

[honestann]

Yeah, I suspect that too.  After all, that's what always happens as far as I can see.  Since when have we seen a win for the home team (the honest, ethical, productive)?

Which does make me wonder why this CFTC buy keeps talking up this issue.

In the end, when "all hell breaks loose" (when the predators cannot restrain the currency collapse), we can all be certain that JPM will reverse its silver positions.  Over night they'll go from being $100-billion short on silver to being $200-billion long on silver.  Since they and only they know exactly when they intend to pull this huge reversal, they will make astronomical profits on this scam.  I mean, really!  One day they're holding the price of silver down with 100-billion pounds of pressure, so they know exactly what will happen when they release that pressure, then ignite an additional 200-billion pound rocket beneath the price.

In the end, fractional reserve banking must go.  These scumbags have unlimited access to the federal reserve 0% loan window.  They can borrow untold trillions at zero cost, then "invest" that into futures contracts with an additional 20x inherent leverage.  In effect, they can buy up all basic commodities on earth without any need to produce anything whatsoever.

[hudson]

Well I had been thinking trading silver for land. I think I'll go silver for awhile cause I want to crush the banksters or a least make them pay attention. I'm making my payment so far and can't rent a house for the same amount per month. I got in before the housing bubble and put 10 % down and did not HEL or  ELOC so all I owe is the original Mortgage at $88,000.00, actually only $86,000 now.

[Tapeworm]

The folks that have taken over the Zerohedge website with their imbecilic calls for silver to 500, or even 100 are disconnected from what the right-here, right now dollars are worth.

 For the silver hoarders and true belivers:

How about a nice two week vacation inclusive of airfare, secondary airfare, all the amenities of a nice place in Costa Rica, and plenty of dough for dining out and  car rental and even taking home a surplus if one sold two Englehard bars of 100 oz.

 Right now Tulving is on offer of ten cents under spot for five 100 oz bars.

 As I said, two of them would allow some fairly high living The cost of those two bars of a decade ago was a grand, and less.

 Trip for two to the same example in gold is two ounces.

 The hypesters that are cheering on the POG rise to 3000, and slAg to be 100/ oz are delusional as their stash will never be worth more in the future than it is right now in Purchasing Power.

 What little that I have is going to a trip for my wife and myself that we have passed on for many years. I'll take two hundred ounces of argentum and pay for something that would have cost easily one hundred times POS in the past.

 The mouthbreathers here just continue with their hope that a silver bubble will sweep them up  into some undeserved monetary nirvana.

 It doesn't work that way. Guys like me bought our tickets back when essentially none would care. Back then two 100 oz silver doorstops were about USD500 per 100 oz bar.

 If one had bought back in the days of disgust at PMs, one would be able to buy a Costa Ricamn vacation for three weeks and including the better amenities for a cost basis of one thousand usd.

 Of course the maggot gombit will tax the collector capital gains of the prudent savers of PMs at a rate far higher than the original purchase price.

 Go spend some money that your silver and gold really is. Take some time to see just how cheap many things are in purchasing power parity when denominated in your glod and silver.             There is a fantasy deflation of real goods like transport and vacation spots that will allow your biggest purchaing power ever if you work with the bargains offered now that are many times better for those goods than any time in all history.

 It is money, no?

[traderjoe]

Spending v. saving. Apples v. oranges. 

[Rick Masters]

What do you think the price of silver will be in say 2012? Seriuosly. Do you think it goes up, down or relatively the same in both purchasing power and nominal terms. Also, what are your feelings on palladium? Thanks. You bought it when no one did so I'd love to hear your thoughts. Thanks.

[DoChenRollingBearing]

Rick, I have no good idea of where the price of silver will be in 2012, but I think it will be higher than now (even in inflation adjusted terms).  If you (anyone) have sufficient income and/or a stable job, then buy more silver.  Sure!

Re palladium, I am the only one I know who has any, but is a small collection of 10 x 1 oz Pd Maple Leafs I bought at perhaps $400 / oz average price (years ago).  Palladium is an interesting metal, very unusual chemical properties if you take the trouble to research it.  And it is very volatile, it was over $1000 when the Russians were squeezing supply, at that time was worth more than platinum  <--- which the Bearing adores...

Disclosure: approx. 8% of my wealth is in the various PMs.

[Bolweevil]

Your comment reminds me of masturbation. Feel better?

[Dr. Gonzo]

Have fun getting your dick and balls squeezed by the TSA on your vacation. I scrimped and saved and bought a bunch of those $500 door stops way back in the day too. Now I live well and buy whatever I want today...and that happens to be 200 more oz of silver. If Palladium can be $730 then silver can and should be $90. Watch it happen. The world won't come to and end when silver hits $90 in a few years. People will just feel stupid they didn't buy more. I took 5 comex bars for under 10k each 2 months after the collapse of Lehman. I haven't paid more than $20 for silver ever but I will today.

[DutchSucker]

Suicide? This reeks of assassination. The Madoff family knows a lot, or better to say...knew a lot?

[geminiRX]

Umm....2 things:

1. Does SLV actually have any silver?

2. How do we know SLV isn't a proxy for JPM?

[Tense INDIAN]

we all know about the "Buy Silver , Crash JP Morgan" by Max Keiser.......what do u guys think about the below articles ....:

1.Crash Silver, Buy JP Morgan and Prevent Financial Armageddon

http://www.marketoracle.co.uk/Article24912.html

2.Mish has called the crash jp mporgan campaign a viral nonsense:

http://globaleconomicanalysis.blogspot.com/2010/12/investors-hold-biggest-commodity.html

3.heres KD:

http://fridayinvegas.blogspot.com/2010/12/jp-morgan-and-massive-silver-short.html

[time123]

Looks like time to lighten up on materials and precious metals. 

time123

http://invetrics.com