Did Bankers Deliberately Crash MF Global to Crash Gold and Silver Prices?

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Tue, 12/27/2011 - 12:12 | 2013698 Bicycle Repairman
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"I believe that bankers created futures markets for the explicit intent of allowing themselves to manipulate the prices of commodities and to enrich themselves, and themselves only, through the process of alternately and artificially inflating and deflating prices as would not be allowed in any type of free market."

There are no free markets, except for labor.

Tue, 12/27/2011 - 10:46 | 2013424 Alpine
Alpine's picture

JP Morgan Shorts

An important consequence of the Gold/Silver effective confiscation of outright Gold/Silver ownership positions with vault receipts, is that the longs will no longer be willing to have large positions on the COMEX, leaving the Fed executioner (JP Morgan) with their disproportionate short positions to continue to manipulate the price of Silver & Gold for some time to come.

Tue, 12/27/2011 - 10:44 | 2013421 Alpine
Alpine's picture

JP Morgan Shorts

An important consequence of the Gold/Silver effective confiscation of outright Gold/Silver ownership positions with vault receipts, is that the longs will no longer be willing to have large positions on the COMEX, leaving the Fed executioner (JP Morgan) with their disproportionate short positions to continue to manipulate the price of Silver & Gold for some time to come.

Tue, 12/27/2011 - 10:11 | 2013347 Quinvarius
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The problem with the COMEX/MF Global/Bankers trying this game is that they are wired into a global futures system.  The book just gets passed to an honest exchange.  They cannot stop the rise in paper prices anymore than they could stop the depletion in physical.  Infact, as they lose customers and OI, they lose the ability to influence global prices.  Everything the cabal does to stop the price from rising has a short term effect that works for them, but beyond a couple weeks it works against them 100 fold.  The CME was stupid not to make the MF Global customers 100% as their agreements say they will--Incredibly stupid. It is like when they kicked US citizens out of the gold and silver FOREX markets thinking that would stop demand.  Everyone just went to futures and physical.  Now they are messing with the futures market.  Everyone will just go to physical.  Every cabal action has a hidden backfire/blowback effect.   

Tue, 12/27/2011 - 10:16 | 2013364 twotraps
twotraps's picture

great point and I'd like to think that the same applies to all mkt intervention....I keep waiting for a 10X reaction in another part of the mkt system to compensate for all the bullshit over the past several years.  

Tue, 12/27/2011 - 10:41 | 2013410 strannick
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Before anyone goes guffhawing at the title of this article, realize too, that regarding the silver position limits the CFTC said they would enact, were first put off until January, and now have been put off until May. This issue is a leviathan seething beneth the surface, and corrupt and appeasing regulators at the CFTC (Jill Sommers, Scott OMalia, Bart Chilton, Gary Gensler, and the new chick, I forget her name), are doing anything in their power to buy time for the bullion banks, at the expense of precious metals investors. Dont forget they have had an open investigation for silver manipulation for over 3 years. One of the Commisioners, Jill Sommers, voted against even having a public hearing on precious metals position limits.

Tue, 12/27/2011 - 10:07 | 2013341 The Beam
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When I saw MF Global file for bankruptcy, I was reading the story about how they were going to be overseen by JP Morgan. Knowing that they were a big player in commodities (see their stake in the LME), I INSTANTLY remembered the lawsuits against JP Morgan and HSBC for market manipulation (specifically in the silver market). I knew something was there and to follow the money.

Sure enough, JP Morgan has their hands in every part of MF Global.

I see the occasional story about "this" and "that", but nothing has pieced all the parts together. I emailed people the connections. Most didn't seem to think it was a good enough story.

With JP Morgan's positions, and the worrying emails that caused the investigation against them for market manipulation (paper shorting), it is interesting when their physical silver reserves TRIPLED OVERNIGHT (I did see Tyler Durden comment on it)

Tue, 12/27/2011 - 09:51 | 2013298 JailBank
JailBank's picture

I have already been going past themiddlemen and buying silver directly from First Majestic.

Tue, 12/27/2011 - 10:00 | 2013325 San Diego Gold Bug
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First M's prices are Ok but you will get much better pricing on your silver from the biggest dealers.  Check prices at comparesilverprices.com and you will see three dealers that beat FM's prices by a lot.

Tue, 12/27/2011 - 11:53 | 2013619 lakecity55
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Thanks, and a hat tip. Had not found a centralized PM link until your post. I just picked up some Maple Leafs and AU US half dollars.

 

If anyone is interested in another valuable metal (Full Metal Jacket), here's a good link with lowest prices:

 

http://ammoseek.com/

Happy New Year, bitchez!

Tue, 12/27/2011 - 09:28 | 2013226 Pemaquid
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Year end will find PM manipulated so that MSM can pronounce them a looser. Back up the truck Jack!

Tue, 12/27/2011 - 08:19 | 2013083 XtraBullish
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Gold and Silver are shorts until mid-January - buy the ES for a move to record highs...

Tue, 12/27/2011 - 07:38 | 2013001 Benjamin Glutton
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Did Kyle Bass force JPM/COMEX to take out MFGlobal by taking delivery of 1 Billion in Gold a couple of weeks before MFG downgrade?

 

2 minute video of Mr. Bass explaining how he took COMEX Gold from 35:1 OI to 80:1 OI overnite!

 

http://www.youtube.com/watch?v=CjAeriVttw0

 

Gimme the gold.lol

Tue, 12/27/2011 - 08:38 | 2013109 slackrabbit
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This is what Kyle Bass and GATA have been complaining about for years...after no one listening, I guess he made the point pretty clearly....'if the system screws you, then you screw the system'

Theres always an appropriate youtube ... http://www.youtube.com/watch?v=EmDQiL3UNj4

 

"it's not enough, but its close" ;-)

Tue, 12/27/2011 - 07:35 | 2012999 orca
orca's picture

Not to say "I told you so", but I told you so. Electronic gold will go to zero, while physical will spike, or rather fiatponzi will crater (since 1 gram of gold stays 1 gram of gold). Before that we will have force majeure, ie the "temporary" suspending (temporary as in for the next 30 years) of physical delivery, due to "unprecendented dislocation" or something similarly bullshitty.
Your mantra while accumulating physical should be "rather expensive than not at all".
The only good thing is that you can hedge physical with futures,just don't forget to bail out of your electronic shorts before all play is suspended.

Tue, 12/27/2011 - 07:33 | 2012994 vegas
vegas's picture

While you bring up some good points, the main disagreement I have is that banksters act as one. In any conspiracy, everybody has to act together or it doesn't work. I just don't see every bank playing along with this.

 

http://vegasxau.blogspot.com

Tue, 12/27/2011 - 08:45 | 2013129 Smiddywesson
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You don't see every bank playing along with this?  Cooperation and secrecy is at the heart of banking.  Some examples:  

  • Central banks are buying gold, all over the world, all at the same time, and yet, gold prices are falling
  • coordinated margin hikes in the US, London, and China
  • Coordinated interest rate policies
  • The central banks are owned by the same shareholders
  • The Fed bailed out foreign banks for a reason
  • How about this?  It is in the interest of a ruined economy to devalue their currency first, and yet, the only printing being done is just enough to stall and continue to buy up gold.

The Fed and the ECB are the big fish.  They ensure the cooperation of the little fish through force.  They are cooperating.  It is their nature.

Tue, 12/27/2011 - 07:08 | 2012959 onebir
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Mark Cutifani, CEO of AngloGold Ashanti, recently echoed the same: "Major [asset management fund] buyers are finding it is hard to get physical gold. People are coming directly to us [for large gold purchases,] people who want tonnes of physical gold, people with serious financial muscle, because they are finding it is very difficult to secure the volume of gold they want. That is something we have noticed over the last 18 months, and it has been increasing in the last six months. People are finding it’s hard to get physical gold."

I think this is a direct quote from Kingworldnews (& worth attributing).

Tue, 12/27/2011 - 07:04 | 2012954 Zola
Zola's picture

the big problem is the miners using the COMEX price to make deals...as long as they base their sales on that fraudlent paper price, nothing will change

Tue, 12/27/2011 - 09:41 | 2013269 GoldBricker
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There is talk by Jim Willie (I've read him for years; he's overwrought but generally correct) to the effect that big investors are buying directly from miners & fabricators since exchanges can't deliver large orders quickly and are not to be trusted with cash balances.

http://news.goldseek.com/GoldenJackass/1324501200.php

Tue, 12/27/2011 - 06:51 | 2012940 toadold
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The commodities futures market didn't deal in gold/silver when it first started. It was agricultural products. Which is one of the reasons that  in the US it got big in Chicago.  When it first started the people using it were producers and processors.  As it grew and added more non ag commodities, metals and such, it aquired more crooks and manipulators.  Now days the biggest crooks are in bed with the government and thats what has made it so nasty. You can't trust the stats put out from government sources, and one big baking company that  I know of has it's own in house metorlogist now.  This corruption of the market is cracking a lot of peoples rice bowls and I suspect that the blow back is going to be spectacular.  

Tue, 12/27/2011 - 10:10 | 2013346 twotraps
twotraps's picture

exactly, futures were not invented for gold manipulation.

Tue, 12/27/2011 - 06:39 | 2012927 unirealist
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And what happened with the 400 tons of gold owned by Libya?

Where is that now?  I suspect that a LOT of it has been sold into the market to suppress the price of gold.

I also suspect the author is right that the collapse of MF Global is connected to the dire dearth of eligible metals on the Comex.  I don't think we will ever know exactly how and why.

The system is turning to more and more desperate measures to stave off the inexorable forces of reality.

When the crash comes, all anybody is going to know is that the rich fucked us, and the consequences are going to be extreme.

Google "Reign of Terror."

 

Tue, 12/27/2011 - 09:44 | 2013278 GoldBricker
GoldBricker's picture

See my post above. For what it's worth, Willie mentions the use of Greece's 114 tons as well as Libya's 144 tons (where he gets his numbers, I don't know) to engineer a short-term drop.

Tue, 12/27/2011 - 06:28 | 2012916 nathan1234
nathan1234's picture

I dont think there are many real PM buyers left in COMEX. It's just the Crooks buying and selling amongst themselves to fool the public.

And God help anyone who sells their real physical stuff in Comex.

They may never get their money

The CME is a cesspool of criminals

Tue, 12/27/2011 - 06:23 | 2012908 HurricaneSeason
HurricaneSeason's picture

What about Bear Stearns silver shorts picked up by the taxpayer? It's a small market when there are trillions in taxpayer funds floating around.

Tue, 12/27/2011 - 06:06 | 2012901 eri
eri's picture

Wow, what a stupid article.

MF Global is the reason why gold price is falling?!?!

What a crap.

The real dissapointment is to read this kind of crap on Zero Hedge.

Tyler, you are losing it, man

Tue, 12/27/2011 - 08:11 | 2013062 russki standart
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Ad hominems and personal attacks are not arguments.  No one forces you to read this.

Tue, 12/27/2011 - 08:08 | 2013056 scatterbrains
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I could just as easily think the opposite.  Corzine was hating on Goldman after the way he was dumped out. If he knew about a suppression scheme he may have took the other side of the trade knowing that it will eventually blow up on GS/JPM. Once mob banker's saw what he was doing they took silver down hard and a few weeks later MF was bust. Perhaps he's still a free man because the banksters know they can never admit what really happened and Corzine knows this.  The only reason I doubt this line of thinking is because if true Corzine would have been murdered by now.  Unless he hedged his life by threatening to reveal hard evidence in the event of his death or something.

Tue, 12/27/2011 - 07:38 | 2013002 jumblies
jumblies's picture

So state your case, show some data to back it up and explain why you disagree with his premise.

Tue, 12/27/2011 - 06:00 | 2012893 Benjamin Glutton
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This reminds me of going to Solid Gold with some buddies who blew past the doormen sticking me with the cover charge for the group which no sooner had I paid I look up and two of them are being escorted out for unauthorized touching of the "Gold".

 

 

Look but don't touch Bitchez!

Tue, 12/27/2011 - 05:22 | 2012870 Heyoka Bianco
Heyoka Bianco's picture

These "banker conspiracy" posts always make me laugh. They all assume a level of evil intelligence and control that is just not humanly possible (please to be noting that even when they completely game the system, it still ends up in the shitter), and that egotistical, self- absorbed, self-approving pricks can some how come together to work for their common good (or evil, depending on your point of view). Even a cursory examination of any professional sports team will tell you this just don't happen.  Even the best teams can sink quickly under the slightest shift in conditions.

 

The "evidence" cited above can be interpreted in a myriad of ways, but the most obviously likely is simply that most of the 'commercials' knew well in advance that MF was going to live up to its initials, and they knew to dump the longs and jump on the short side when the feces impacted the swirling blades. The power of these yahoos to influence events is far less than is commonly believed, but the general consensus on their frontrunning abilities is probably spot on.

Tue, 12/27/2011 - 09:36 | 2013255 Debt-Is-Not-Money
Debt-Is-Not-Money's picture

If it looks like a duck...

Tue, 12/27/2011 - 08:19 | 2013082 russki standart
russki standart's picture

Just because you do not find it humanly possible does not make it so.  My suggestion is to start researching central banks and foundations and learn what are the mechanisms of control, that most of our history is not random but directed. 

Tue, 12/27/2011 - 05:06 | 2012863 Money 4 Nothing
Money 4 Nothing's picture

Yes, I said that from day 1, Jon was sent there to gut the firm and my reply was glossed over.

 

-JP

Tue, 12/27/2011 - 05:00 | 2012857 PsychicWebbah
PsychicWebbah's picture

So the moral of the story is if you plan to to take physical delivery make sure JPM or GS is your broker as they will never fail. Then we can see the real hurt when they can't come up with the metals we are after.

Fri, 12/30/2011 - 19:18 | 2022799 SilverTech
SilverTech's picture

Don't think that being a JPM or GS customer will protect you in any way. Just makes you an easier target.

Tue, 12/27/2011 - 04:49 | 2012835 non_anon
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ding, ding, ding, ding

Tue, 12/27/2011 - 04:32 | 2012825 AUD
AUD's picture

Though bankers claim that they created futures markets to provide a mechanism for commodity producers to hedge against volatile market prices

I suggest to you that in fact futures markets were 'created', more likely evolved, to allow producers to sell forward their produce, that is to monetise it before it is even produced. It is easy to see how this would benefit the producer, it is a form of credit for the producer.

 

 

Tue, 12/27/2011 - 08:56 | 2013158 twotraps
twotraps's picture

thanks for that...its not why they were 'created', kinda of a drag on credibility but I don't doubt that its manipulated, its about gaming the system these days, trading is secondary.

Tue, 12/27/2011 - 04:20 | 2012819 Advoc8tr
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Entirely plausible IMO.  If futures were in fact for the stated purpose of hedging then you would have to own the undelying commodity to short it, there would be no leverage allowed and the vast majority of contracts would be 'delivered' on expiration.  It is clearly just a casino at this point and the house takes a cut no matter what happens.  It is reminiscient of that 1 guy in a billion that hits the super jackpot at the casino only to be thrown out and told it was a computer error .....  the prize never existed in the first place just like the corresponding amounts of physical commodity do not exist in the futures market.

Tue, 12/27/2011 - 09:05 | 2013177 GoldBricker
GoldBricker's picture

I recall reading, around 2005, Ted Butler claiming that the total short/long open interest in silver was greater than all the above-ground metal in the world. (I suppose we have the same thing in the 'notional' hundreds of trillions in non-commodity derivatives.) It's the fractional-reserve idea at work.

So what you say is true; these are just bets on a future event, like a sports bet. And like sports bets, there is always the potential for the betting to leak through and, Heisenberg-like, affect the event itself.

Tue, 12/27/2011 - 04:12 | 2012814 t0mmyBerg
t0mmyBerg's picture

this post reminds me of the point in Finding Nemo when Marlin and Bluie are supposed to jump out of the EAC at Sydney and one of the little turtles says something like "then you rip it roll it and jump it".  Marlin looks at him and says something like "I know he is trying to say something to me, I just don't know what it is".  Although that may be giving too much credit in this case.  Low signal-to-noise ratio.  I guess in this slow holiday season, in the deep breath before the coming storm, some filler was needed.

Tue, 12/27/2011 - 09:52 | 2013305 Bendromeda Strain
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And you thought that point was so clever you couldn't be bothered to google the character's actual name?

Tue, 12/27/2011 - 03:50 | 2012799 Freddie
Freddie's picture

The silver linking in the MF Wordlwide debacle would be seeing Jon Corzine swing from the end of a rope.

Tue, 12/27/2011 - 03:04 | 2012784 One World Mafia
One World Mafia's picture

http://nextbigfuture.com/2010/10/nautilus-minerals-first-commercial.html

Insurance is one thing. Betting the farm is another.

Tue, 12/27/2011 - 02:17 | 2012767 The Peak Oil Poet
The Peak Oil Poet's picture

 

 

yet anoher shill post by ZH

 

watching the ZH headlines amidst the headlines of my now something like consolidated 300 news feeds puts things into perspective.

 

ZH i loved you when i met you like you were a virgin beauty.

 

Now i see you as just another avaricious slut

 

pop

 

 

Tue, 12/27/2011 - 08:56 | 2013157 Smiddywesson
Smiddywesson's picture

"300 consolidated news feeds."

 LOL, garbage x 300 is still garbage.  It's the quality of what you put in your mind that counts.  This isn't a hot dog eating contest for the mentally obsese.

My suggestion is to cut it down to 299.

Tue, 12/27/2011 - 10:53 | 2013437 mrgneiss
mrgneiss's picture

Awesome response, garbage times 300 is still garbage!

Tue, 12/27/2011 - 02:40 | 2012778 malek
malek's picture

>yet anoher shill post by ZH

Says a peak oiler - LOL!

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