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The Weekly Dose of Gold & Silver Market Manipulation

smartknowledgeu's picture




 

This strange event happened this past Tuesday in the COMEX New York markets but I didn't have time to post it until now. Not much to add here in the commentary that the pictures don't say themselves, except that market prices of two different assets do not plunge in tandem by 1.2% within a matter of half-an-hour or so at precisely the same time and then gain everything back in the next two hours if their prices are set by free and fair markets. In regard to the buzz on the blogosphere this week regarding rebuttals to gold and silver market manipulator deniers, I believe that a lot of gold/silver analysts that deny gold/silver market manipulation actually believe, and firmly believe, that the gold/silver markets are manipulated. How can you not believe, given the numerous instances of tens, and sometimes, hundreds of millions of paper silver (and paper gold) ounces dumped in the futures markets immediately before intra-day crashes in price that occur on a nearly weekly basis now? In the face of all the evidence, including documented minutes of the US Federal Reserve that actually admit to gold/silver market rigging (just refer to any of a number of GATA publications), the gold/silver analysts that continue to deny market rigging would:

 

(1) either have to possess so little critical thinking ability that they also believe that OJ Simpson was innocent of murdering Nicole, that Santa delivers gifts to billions of households in one night on Christmas Eve, and that a flying tooth fairy delivered money underneath their pillow when they were a child; or

(2) simply have chosen to deny manipulation as a pure Machiavellian business decision.

 

I believe that the reason for continued denial of gold/silver price suppression schemes from gold/silver analysts today is answer (2).

 

Rather than expose the truth about the corrupt and criminal banking cartel's price suppression schemes and help people understand the reality of rigged gold and silver markets, those that continue to deny gold/silver price suppression schemes and whose business depends upon analysis of gold and silver realize that such an open and honest stance is not the opinion of the mainstream masses. Thus, they know openly speaking about this would hurt their business sales, and perhaps quite significantly. After all, the sweet spot of money to be made for any business lies within the mainstream and popular view. As long as one can "sell" one's belief in this view, even if one may not really believe it, then one can keep convincing the largest market share to buy. And this is the REAL reason why I believe that many intelligent gold/silver analysts out there continue to publicly deny gold and silver manipulation while likely privately harboring an opposition view. Still, all the attempts of the banking cartel to suppress gold and silver prices remain subject to the Law of Diminishing Returns, and gold and silver, while still range bound at the moment, will break free and continue their upward trend soon enough.

 


 

About the author: JS Kim is the Founder & Chief Investment Strategist of SmartKnowledgeU, a fiercely independent, precious metals focused investment research & consulting firm dedicated to exposing the fraud of the global financial system and helping clients build wealth by understanding truth.

 

 

 

 

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Thu, 04/19/2012 - 23:56 | 2360302 MeelionDollerBogus
MeelionDollerBogus's picture

For anyone crying about manipulation instead of enjoying it I'll say this:

I've been able to calculate the prices of gold months ahead of time. The price action is forgiving. They DID this, those central banks.

Thank your lucky stars they aren't shoving gold and silver down at -5% and -10% per year on a 5 year solid basis only to shove them up +2000% without notice.

Don't think for a second they can't. EVERY choice has a consequence, that one included, but it IS a hand they can play.

Thu, 04/19/2012 - 23:47 | 2360293 MeelionDollerBogus
MeelionDollerBogus's picture

10 years of gold & silver data, scatterplot, and a subset of that data that's more recent. sorry I didn't actually update the graphs to today's data - I'm lazy. Feel free to grab the data from:

 

http://www.fxhistoricaldata.com/download/XAGUSD?t=hour

http://www.fxhistoricaldata.com/download/XAUUSD?t=hour

feel free to change =hour to =day for daily

feel free to change XAG to AUD, USD, etc for either of the pair half to get the data you desire. Personally if the first pair doesn't start with XAG or XAU I have little care for it but it's there.

2011 dec 27 gold 08 | scatterplot gold vs silver zoomed in

2011 dec 27 gold 07 | 10 years gold vs silver scatterplot

The scatterplots pretty much show that when you're in the middle of one of those big straight lines, you're in the middle of the same manipulation shown by the overlays. The hourly data shows it short-term but long-term is what matters for the end-game.

Thu, 04/19/2012 - 14:59 | 2359175 Imminent Collapse
Imminent Collapse's picture

I can't believe that there are people on ZH that are arguing that there is no manipulation in PMs.  Wow!  You either aren't paying attention or you are trolls. 

The bottom line is that it is important for the Central Banks not to allow gold and silver to go to their market values because it will demonstrate conclusively that the fiat currencies are losing their value. 

The trick here is to load up on PMs in an effort to protect your savings against inflation and then wait for the coming collapse. 

People will argue that should such a monetary collapse occur, then PMs will likewise have no value, or the government will confiscate all PMs, but I'm willing to take my chances, especially after that unfortunate boating accident sent all my PMs to the bottom of the alligator infested lake recently. 

Buy and hold and see what happens. It can't be any worse than holding paper currency.  More importantly, make sure that you can grow your own food and know your neighbors.  Community will be critical. 

And good luck!

Thu, 04/19/2012 - 14:15 | 2359010 devo
devo's picture

Bank error in your favor: collect discounted gold

Thu, 04/19/2012 - 14:11 | 2359001 hermes trismegistos
hermes trismegistos's picture

what is all this crying about market manipulation? This is a war and the general principle is to take as much as you can from those who are so stupid to allow it.Those who have power will always use it tpo their own advantage.If you do not like it get out of the game, or, if you plan accordingly , you may follow their track and take advantage of the situation.Then teach others how to profit from it and by so doing build an army of enought strnght to have a battle on the same ground with your enemy.Stop crying, and come  up with an effective plan to use manipulation, profit from it and turn the cause against the same people that are creating it.

 

Thu, 04/19/2012 - 14:27 | 2359055 Whalley World
Whalley World's picture

too right, education is the key and the best book on this is Ferdinand Lipps' Gold Wars!  Once you realize that this is war, you look at the game differently.  Got Gold?

Thu, 04/19/2012 - 13:32 | 2358853 Likstane
Likstane's picture

Some things are just obvious after a while.  Building #7, money creation, Barakastains birth cert,  fake tits,  truth about human nature, homo-co-workers,  death,  uncle Joes alcohol prob, metals manipulation, 

You don't always have all the witnesses and all the facts, but denying the obvious is kinda like pretending you are getting a good deal at the used car lot.  If you keep telling yourself you're not getting ripped off, you tend to believe it for a little while.  Eventually you must acknowledge the truth. 

 

Thu, 04/19/2012 - 13:22 | 2358814 silverserfer
silverserfer's picture

only paper longs and old stackers should sweat this. I myself dont retire for 30 years and see this as a great opprotunty. My LCS stillsells at the same price over spot on the dips so FUCK IT! 

Thu, 04/19/2012 - 13:13 | 2358777 jack stephan
jack stephan's picture

Dominic Cattano: 'Course you are right. Everyone's right. It's America. We just can't do it at that unreasonable expense of others. Because then it becomes un-American. That's why the price we pay for that gallon of milk could never represent the true cost of production 'cause it's gotta be controlled, right? It's got to be set. It's gotta be fair.
Frank Lucas: Gotta be controlled by who? I set a price that I think is fair.
Dominic Cattano: I don't think it's fair.
Frank Lucas: You don't?
Dominic Cattano: I don't think it's fair.
Frank Lucas: I think it's fair.
Dominic Cattano: I know your customers are happy Frank. Bunch of fuckin' junkies that they are. What about your fellow dairy farmers out here, Frank? Are you thinkin' of us? You thinkin' of them?
Frank Lucas: Dairy farmers?
Dominic Cattano: Yeah.
Frank Lucas: I'm thinking of them, Dominic, about as much as they've ever thought about me.

Thu, 04/19/2012 - 12:05 | 2358567 Born-Again Bankster
Born-Again Bankster's picture

Got Stop Loss?   Of I course I...d'oh!

Thu, 04/19/2012 - 11:52 | 2358517 pleseus
pleseus's picture

CFTC is in on it.  They let it happen for a reason.  Central banks around the world want their fiat paper currencies to have value.

Thu, 04/19/2012 - 15:12 | 2359215 engineertheeconomy
engineertheeconomy's picture

Central Bankers vs. The People by the People for the People. It's 1776 all over again except now its on a  global scale. Long Guillotines and coffins

Thu, 04/19/2012 - 11:13 | 2358361 WAMO556
WAMO556's picture

If you think of this "dip" in military terms and call it a Salient - then this formation makes sense - A salient is a battlefield feature that projects into enemy territory. The salient is surrounded by the enemy on three sides, making the troops occupying the salient vulnerable. The enemy's line facing a salient is referred to as a re-entrant (an angle pointing inwards). A deep salient is vulnerable to being "pinched out" across the base, forming a pocket in which the defenders of the salient become isolated and hence annhilated. The thing to remember is this - business is warfare.

The SWIFT was just recently used as a weapon used against a population.

Gernal Patreus said: "use money as a weapon system"!

Folks, just in case you don't know what is going on, there is a battle being waged, figuratively and literally over who controls the precious metals markets. Be advised that there are many fronts and that the one that you are seeing is being waged in a cyberwarfare front. Think about! There are MORE agencies working on this and gaining business intelligence on how to fight this ware then are showing their hand.  Just saying of course!

Thu, 04/19/2012 - 12:33 | 2358649 engineertheeconomy
engineertheeconomy's picture

Good point. They spend several Trillian Dollars a year on trolls, media, "we buy gold" signs, etc. The war has now accelerated to the point where you will see an exponential expendature on this (Precious Metals Smear Campaign)

Congress will have to increase their annual budget to $1,000,000,000,000 to fight gold.

You, the tax payer, will have to pay them back with interest of course...

Thu, 04/19/2012 - 13:15 | 2358783 fockewulf190
fockewulf190's picture

With dips like that, you can see that the empire isn't using conventional weapons, they are using nukes. Well, I'll stick to being a soldier of the Viet Cong of the metal world and keep stacking my Phyzz...taking fiscal AK-47 shots at the beast with every ounce of silver I buy, and fiscal RPG-7 shots with each ounce of gold I buy. Oh, and I don't care if I get wounded, I'll keep buying regardless until the enemy withers and dies.

Thu, 04/19/2012 - 15:10 | 2359206 engineertheeconomy
engineertheeconomy's picture

IN GOLD WE TRUST

Thu, 04/19/2012 - 11:05 | 2358337 resurger
resurger's picture

 O_0

It's all natural

Thu, 04/19/2012 - 10:47 | 2358260 tony bonn
tony bonn's picture

jpm was training a rookie which caused the simultaneous drops.....after he seasons up a bit, the price plunges will not be so obvious....

Thu, 04/19/2012 - 10:25 | 2358169 Bansters-in-my-...
Bansters-in-my- feces's picture

Die....all you fucking pig-dog precious metal manipulators.

Thu, 04/19/2012 - 13:24 | 2358820 The Continental
The Continental's picture

Don't forget our German brothers in arms:

 

"Tod! alles fooking Schweinhunten manipulaten metallen waren!!!

Thu, 04/19/2012 - 11:08 | 2358342 resurger
resurger's picture

Amen!

Thu, 04/19/2012 - 10:23 | 2358161 besnook
besnook's picture

the bottom line is, in any market, if it is able to be manipulated and the only consequence of the manipulation is profit then the market will be manipulated.

even in the case of china where the penalty for market manipulation is death the markets are still regularly manipulated.

Thu, 04/19/2012 - 10:19 | 2358143 Catullus
Catullus's picture

I don't understand why someone goes into any market thinking that they're not manipulated. What does knowledge of the manipulation get you? If the price of gold or silver "skyrocketed" tomorrow, what would you interpret it as? The market was finally allowed to go its "true" levels? The price on the market right now is what the metals will exchange for. The price of physical is based on the paper price right now. You can get it delivered to you at some premium to spot.

Manipulating the price down doesn't seem like an intelligent move ultimately since the lower price encourages people to accumulate positions in both gold and silver. If you wanted to manipulate the price, you would send it up and discourage people from buying it and shake loose people's positions who are in it to make a paper gain. Gold and silver traders seem to be the ones who make the incredible claim that if the price goes up, the demand will in turn go up and everyone will panic to buy PMs. It's pretty much the exact opposite of what will occur.

Thu, 04/19/2012 - 12:38 | 2358663 Conax
Conax's picture

"If you wanted to manipulate the price, you would send it up and discourage people from buying it and shake loose people's positions who are in it to make a paper gain."

There was massive interest in silver last spring, before the May 1st debacle. As the prices rise, it begins to interest the big guys, institutionals and heavy hitters.

After being beaten like a red headed step child, they realize it is risky due to the antics of the manipulators, and back away. The smart money, like the Chinese and Indians, are non-plussed and suck up and ship out the physical on the cheap while Boobus-Americanus is still backing away.

So we, the Boobusese get screwed, America gets screwed, Chinese win, all to keep the caviar and bubbly flowing for the fiat masters and their running-dog lackeys in DC.

Thu, 04/19/2012 - 12:28 | 2358630 SilverIsKing
SilverIsKing's picture

You are exactly wrong sir.

Thu, 04/19/2012 - 13:19 | 2358810 Imminent Crucible
Imminent Crucible's picture

Young Catullus was not around to hear Paul Volcker's statement: "My big mistake was in allowing the gold price to rise." A fast-rising gold price is an indicator of eroding confidence in an unbacked, worthless paper currency.

When you hear some one say "Gold is just another commodity, and trades like every other commodity" you can be sure of two things: He is definitely a fool, and definitely not a gold trader.

Thu, 04/19/2012 - 13:18 | 2358803 fockewulf190
fockewulf190's picture

Indeed. I'm American and I've been stacking for years. Winning!

Thu, 04/19/2012 - 10:12 | 2358120 Al Huxley
Al Huxley's picture

The current oscillation around $1650 is just a good way for the GLD option writers to make sure their largest exposures (put and call) expire near worthless tomorrow.  Wait until after COMEX expiry next week and then the market will free-trade again for a couple of weeks to establish the set point for May's fleecing of the rubes.

Thu, 04/19/2012 - 10:07 | 2358089 Richard Whitney
Richard Whitney's picture

I don't know whether there is price manipulation, but does this COMEX move on Tuesday prove it? Some entity needs to raise cash, say a European bank needing to boost capital, and they unload some silver and gold at the same time. Their sale goes off at some lower price and supply is assimilated, price rebounds. Not manipulation. This isn't some deep treasury market.

I can remember claims that the gold price was manipulated at $278. Good job! Keep on manipulatin'!

Thu, 04/19/2012 - 12:28 | 2358638 SilverIsKing
SilverIsKing's picture

Hey Dick, get back on the turnip truck you moron.

Thu, 04/19/2012 - 10:28 | 2358177 Bansters-in-my-...
Bansters-in-my- feces's picture

Richard W......

Fuck off shit head.....

Go blow an authority figure,it seems your way.

Thu, 04/19/2012 - 10:03 | 2358069 El
El's picture

If the manipulation ever comes to an end and free markets are allowed to determine the real price of gold and silver, there are going to be a few people who wake up to find that they have created generational wealth on a salary comparable to that of the average office worker. Think about it. If some secretary had been investing 10% of her $35k-40k income into physical gold and/or silver every month over the past ten years, instead of into the company's 401k plan...

I'm not going to take the time to do the math, but it strikes me that if, conservatively, gold hit $2,500 and silver hit $100, that secretary would have some return on her investment. What makes this even better is the lack of counterparty risk. It's beautiful. Now we can't have that, can we? The manipulation will continue until it no longer can.

Thu, 04/19/2012 - 09:45 | 2358036 tocointhephrase
tocointhephrase's picture

Epic fail!

Thu, 04/19/2012 - 09:44 | 2358034 lakecity55
lakecity55's picture

Keep Stackin !

Thu, 04/19/2012 - 09:55 | 2358028 Treason Season
Treason Season's picture

Sawadee Khun Kim,

If you're reading this could you answer a question that's always bugged me about these manip stories. Don't get me wrong, I'm a long term buy and holder but something doesn't mesh with the cospiracy theory.

No matter what kind of horror manipulation we believe we see in the markets you can go to the gold shops on Yoawarat or in Banglampoo or anywhere else in Bkk or for that matter in the world and the pog always follows the price set by the London/NewYork. Chai mai? So how is it, say if you're a gold merchant and say there's strong buying in your local market, take an extreme example, you're dealer and you've got only one bar left or coin, whatever and we all know the saying demand sets price and yet, yes and yet that dealer is going to say, well I know this is my last piece of gold but those guys in the other side of the world know better than me so I will not raise the price because they say so. Kho jai mai? because I mai kho jai. Kraap khun kaap

Thu, 04/19/2012 - 18:34 | 2359756 prole
prole's picture

Of course JS can answer much better than I, but!

As long as NY/London are willing to sell at whatever price they set, then that is the price. They have to have the metal at that price in order to have that price hold.

OTOH I have seen small-scale silver dealers fold up their arms and claim "I have no ASE's" when asked to sell on sharp dips below 30 recently. My opinion is that they didn't believe the dip, and were refusing to sell it, preferring to hold their silver. If it dipped further to 25 then 18, their strategy would backfire non? I am the only PM bug who believes this could happen?

As long as NY and APMEX are selling (more or less) at spot on all dips, then the NY/London price is real, IMHO.

"You should say something Jerry, this is real"

Even if you don't understand that, just BTFD

PS JS Kim rules

Thu, 04/19/2012 - 09:40 | 2358017 The Continental
The Continental's picture

This is blatant paper shorting price suppression by JPM and their minions. Then the commericials come in and scarf up the contracts and save $millions. Read Mike Maloney and Ted Butler to understand how these insiders make money on a daily basis churning the price. Silver and gold are ridiculously cheap given present day monetary aggregates, FED monetizing 80% of new Treasury debt issuances, ECB balance sheet exploding, EU on it;s last legs, Greece about to default, imminent ME war, imploding ore grades coupled with near record oild prices, yada yada yada. There's a clamp on the gold and silver prices that is so obvious to anyone paying attention. Both metals are forming massive pennants. TPTB cannot keep the prices suppressed for long - physical supplies are dwindling and China and India buy massive amounts on these dips.

I bought 3 silver eagles for $111 the other day. This represents a tiny tiny portion of my physical. My average price paid is less than a third of this. Two points:

1. $111 is not chump change for most American families today.

2. Families are struggling and they are not going to spend $111 on a metal that they do not understand, feel no compelling reason to own, and fear it's price volatility.

Ironically, if every American family bought just one ounce of silver, JPM and the COMEX would be busted pronto. Sadly, most Americans and Europeans have been reduced to pennery through inflation, job losses, asset price deflation and taxation. They are suddenly over a financial barrel with insufficient funds to buy and hold metals.

Thu, 04/19/2012 - 09:59 | 2358071 lakecity55
lakecity55's picture

While maintaining some mining stocks, I am putting everything else into PMs.

This is anectdotal, but in numerous visits to the local professional coin shop, I have seen numerous oldsters coming in with bags of silver dollars.

My point is, that silver, once the common man's currency, exists in large enough amounts still in citizens' hands, that could form a valid system of exchange should (when) the Crash happens.

At that point, folks will realize they do not need  "The Fed."

Rocknroll. Long on Freebooters!

Thu, 04/19/2012 - 11:02 | 2358323 The Continental
The Continental's picture

Yes, there is always a debate about how much physical silver in the form of old US pre'64 coins is sitting in safes, drawers and cans all over the US.

IIRC, the SIA has been counting investment silver as part of the silver supply and showing a small silver annual surplus. Without coin investment, silver is still is supply deficit. My gut feeling is that private silver hordes are very depleted from 1980s levels and are dwindling each day. Industry burns about 14 oz of silver per second. That's silver that is gone forever and never to come back. Silver is going to be an extremely scarce and valuabe resource in 20 years when the world one day wakes up to near zero physical and severely depleted ore reserves, forcing a huge price increase to make extraction economical and supply barely sufficient to feed the tech and industrial sectors. Silver's industrial uses just boggle the mind in their versatility and multitude.

Thu, 04/19/2012 - 09:38 | 2358002 Downtoolong
Downtoolong's picture

This one looks like a dump and pump. Someone was probably pricing a chunk of a major OTC derivative contract which settled on a high-low average of the futures index. Set a lower low, even for one second, and it drops the average price of the entire contract.

Ah, the luxury of being innocent until proven guilty combined with the knowledge that no one can ever take you to court. And just in case they do, you've got the ultimate backstop. The judge and jury are on your payroll.     

Thu, 04/19/2012 - 09:21 | 2357925 nuggetstoosmall
nuggetstoosmall's picture

Hmm, nanosec trading, and naked short selling, lets all profit from the dip, YE HA.

Thu, 04/19/2012 - 09:17 | 2357907 Kina
Kina's picture

Absolute total corruption across ever sphere in the US an open 'secret'.

Banksters have well and truly bought up most congressmen, and regulatory authorities, and their fare share of the judiciary.

Everybody knows it.

Nothing to be done as they are not going to arrest and jail themselves.

Blatant and obvious corruption of the metals market, let go everyday by the CFTC, as they are staffed by the corrupted and there to aid law breaking.

 

The US is on a road to nowhere, and they will get there at some stage. They will have well and truly fucked over every one of the 99%. Nothing to be done except look out for yourself with PMs, food and whatever....for when the game ends.

Thu, 04/19/2012 - 09:12 | 2357873 Money 4 Nothing
Money 4 Nothing's picture

Free market baby!

Thu, 04/19/2012 - 08:58 | 2357818 Peter Pan
Peter Pan's picture

Leverage and impatience are just about the only two things that can bring a gold investor undone by either frustrating him or panicking him into selling. Nobody cuts down a tree in winter because it bears no fruit. Instead that person waits for the month when the tree once again bears fruit. It's the same with gold.

If you cannot bear the slow price of gold in winter then just admit you are just a fickle investor who has little appreciation of the inescapable collapse that will arrive once all the mathematical and mechanical permutations and combinations of central banks and governments are exhausted.

Thu, 04/19/2012 - 13:12 | 2358773 engineertheeconomy
engineertheeconomy's picture

GLD to ZERO now, sell the shit, it's easily printable paper not backed by anything.

GOLD UPWARDS, buy all you can get your hands on.

Silver, Palladium, Platinum, Rhodium too.

Buy Physical.

These low prices will not last.

Hyperinflationz Bitchez

Thu, 04/19/2012 - 08:54 | 2357804 Bagbalm
Bagbalm's picture

There is no money to be made by suppressing the price of metals at a consistent low level. The money is in running the price up and down. If you only have to push it one way and it recovers naturally then it is all the easier.

Thu, 04/19/2012 - 09:23 | 2357936 RockyRacoon
RockyRacoon's picture

Since the Fed and the bullion banks are joined at the hip, it may not all be about making a profit.   It just could be that the objective is to reduce market confidence in the PMs and stir some dollar boost.   There are bigger fish to fry here than making a couple million on jostling the bullion pricing.

Thu, 04/19/2012 - 13:25 | 2358834 rosiescenario
rosiescenario's picture

Exactly.....what the Fed (meaning the Bankstas) absolutely cannot tolerate at this point in time is for a rulered rising trendline in the pm's....they already have a huge problem with oil and food.

Thu, 04/19/2012 - 10:32 | 2358198 LowProfile
LowProfile's picture

DING DING DING DING DING

...We have a winnah!!!

Thu, 04/19/2012 - 08:50 | 2357791 Stuck on Zero
Stuck on Zero's picture

Large market players can perform a "probe" of the market in precisely this way.  It is "perturbation analysis."  It tells the player immediately how resilient the market is to a fall in price.  This kind of test usually is performed because the player does not have access to limit order information.  This probe would instantly yeld all of that information.  Don't you wish you had the clout to pull off something like this?

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