Precious Metals Manipulation Worse Than Libor Scandal, German Regulator Says

Tyler Durden's picture

Remember when banks were exposed manipulating virtually everything except precious metals, because obviously nobody ever manipulates the price of gold and silver? After all, the biggest "conspiracy theory" of all is that crazy gold bugs blame every move against them on some vile manipulator. It may be time to shift yet another conspiracy "theory" into the "fact" bin, thanks to Elke Koenig, the president of Germany's top financial regulator, Bafin, which apparently is not as corrupt, complicit and clueless as its US equivalent, and who said that in addition to currency rates, manipulation of precious metals "is worse than the Libor-rigging scandal." Hear that Bart Chilton and friends from the CFTC?

More on what Eike said from Bloomberg:

The allegations about the currency and precious metals markets are “particularly serious, because such reference values are based -- unlike Libor and Euribor -- typically on transactions in liquid markets and not on estimates of the banks,” Elke Koenig, the president of Bafin, said in a speech in Frankfurt today.

Actually, what makes the most serious, is that precisely because they are on liquid markets means they implicitly have the blessing of the biggest New Normal market maker of call - the central banks, and their own "regulator" - the Bank of International Settlements (hello Mikael Charoze).

“That the issue is causing such a public reaction is understandable,” Koenig said, according to a copy of the speech. “The financial sector is dependent on the common trust that it is efficient and at the same time, honest. The central benchmark rates seemed to be beyond any doubt, and now there is the allegation they may have been manipulated.”


Bafin has also interviewed employees of Deutsche Bank AG as part of a probe of potential manipulation of gold and silver prices, a person with knowledge of the matter has said.

We wonder how long until this particular investigation is stopped based on an "executive order" from above, because Bafin is now stepping into some very treacherous  waters with its ongoing inquiry of gold manipulation: what it reveals will certainly not be to the liking of the financial "powers that be."

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Crash Overide's picture

Can anyone provide an example of a market that is not manipulated?

Local bingo @ the Moose maybe?

rosiescenario's picture

LIBOR is far worse in that so many contracts and deriveatives are tied to dwarfs the pm market.


Not that any of this criminal activity in either market will ever be is impossible for that to happen since the regulators would be cutting their own throats.

BandGap's picture

Which is wy this story intrigues me. The psychological effect must outweigh the net worth of the gold being manipulated. Otherwise this is a small, back stage story.

Dewey Cheatum Howe's picture

The attack on the USD as reserve currency is on. It is coming from all angles now.

Bastiat's picture

Who knows just what conctracts and dervatives are tied to the price of gold? 

whisperin's picture

Must be the response to the paltry sum of 32 (?) tons sent back from the good ole USS of A.

adonisdemilo's picture


Two more words;

Already ordered.

Madcow's picture

Things might turn out okay - so long as banks are prohimited from "prop trading" or "making markets" in commodites, FX, and futures markets.


What was wrong with Glass Steagall ??

Clowns on Acid's picture

Nothing was wrong with Glass Steagal except that RobertRubin and tribe, could make more money if it was repealed. So they got Bill Clinton (incredibly) voted into the WH the same way JFK got elected (and Obama)...thru the Media.

Once they had their boy in office all they had to do was illustrate all the "benefits" of effciciencies of scale by allowing banks, insurance companies and brokers merge under 1 corporate umbrella. And that's what RobertRubin friend Sandy Weill had an insurance company with an umbrellas its corporate logo.

After 2007/08 Glass Steagal was 37 pages long... it has now been replaced by Dodd Frank and DR is 14,000 pages. Oh yeh eeverybody understands what is in Dodd Frank... its going to save the system and really scare the banksters straight.

fijisailor's picture

OK so where are all those ZH trolls who claim it's not manipulated now?  Conveniently quiet huh?

youngman's picture

so they make a few hundred billion..and then pay a fine of just 2 0r 3 billion...its still a good business move...

AGoldhamster's picture

revenge - now Germans will never ever get their gold back - damned regulators.

SumSUN's picture

And I keep stacking while it's on sale.  Along with China, Russia, India etc.

AGoldhamster's picture

Eikie will be blackmailed by NSA. 1,2, 3 .... until he rows back?!

swanpoint's picture

But TRADER DAN says it ain't so!

ForWhomTheTollBuilds's picture

Unlike a lot of traders in 2013, Dan still has money.

swanpoint's picture

He's no fool and he's no sucker. Been reading daily for a year or two. Found him via Turd, who I stopped reading a year or two ago.

seek's picture

I'll take a contrarian side this this thought experiment:

Perhaps the financial powers that be in Germany ordered this to happen, rather than being against it?

The truth would greatly damage the US and the Fed -- if Germany thought pressure like this could speed up deliveries of the non-existant gold, I could see them using this.

The game theory here is interesting -- if the German gold will never be delivered, they would have a motive to expose the fraud. If Germany doesn't believe it will be delivered on any sane schedule, they are probably still motivated to expose it, since letting the powers that fucked them stay in power is likely not beneficial to them, especially if they're backing non-German interests in the EU metldown, which they likely are. Germany's only real motive to shut up about this is early return of their gold holdings -- and once they have the holdings, it's again in their interest to exposure the fraud.

Short version: If Germany doesn't believe they're getting their gold back -- either ever or "soon," they have every reason to fuck the Fed over with the truth.

Kind of ironic giving someone their own money back is "hush money" here.

Dewey Cheatum Howe's picture

Either that or Russia/China has made an agreement to quietly reimburse the gold from the reserves China is buying hand over fist and between the 7 year gold delivery and NSA debacle Germany has had enough and has quietly switched teams. This being one of the favors asked in return which is attack the gold manipulation scheme since it is in Germany's interest for the price to increase anyways if the gold is guaranteed to be delivered by China now.

Russia has leverage on Germany, who runs EU natural gas barter town and has a dedicated pipeline in the system reserved exclusively for Germany.

That part of the world needs gas more than they need the USD....

tenpanhandle's picture

My tinfoil hat works better than yours.  Yours must have a large hole in it.  Better check.

Dewey Cheatum Howe's picture

Mine is silver flake encrusted. Besides aren't the financial agreements about up that the German government had to honor due to the reconstruction of Germany after WWII?

MeelionDollerBogus's picture

broken assumption: what if Germany's government only pretended to want gold back, to be popular, but actually would happily see it never return so long as other benefits came in its place (only for government)?

Riprake's picture

The best way to counteract such manipulation? Buy delivery contracts and demand delivery. If enough people do that, the game is up.

If you specifically do that, you either get the goods at a manipulated artificially low price (if you're early to the table), or you get a cash settlement at significantly more than you paid for the contract (if you're late). The only way you lose is if the companies selling these bits of paper get to default on those contracts altogether, which is what happens if you're really late to the table. In the game of paper gold where delivery contracts are basically a form of buying on margin, a demand for delivery is a margin call; the difference is that this time it's the guy who owns things on paper who gets to make that call, and the seller who has to pay for it or go bust.

seek's picture

...or you get MF Global'd. I think that's the real reason we haven't seen a big player do this already.

Dewey Cheatum Howe's picture

You'll probably see that move happen by someone outside in a place like Russia, etc once the gold musical chairs buying spree music is ready to stop and it is time to go in for the kill on USD hedgemony.

Cast Iron Skillet's picture

that's "Corzined", if you please.

lakecity55's picture

Are not folks already doing that with mint issues?

The BOE has already sold out of this year's sovereigns unless they mint more. I think the US Mint has also put a limit on Ag Eagles, someone correct me if I am wrong.

Long PMs!

Keep Stackin!

Keep Packin!

eddiebe's picture

Nixon truely was a DICK.

Save_America1st's picture

FUCK YOU, Bart Chilton and friends from the CFTC!!! helps a little, but I'm still pissed.  ;-) lol


That is the correct attitude sir.  Round up all these bought out COCKSUCKERS together.  Tar and feather them, one and all.  No exceptions.

CryptoCoinUser's picture

Invest in physical gold and silver while the price is manipulated down:

americanspirit's picture

A few years ago I had the pleasure of visiting Nixon's grave in Yorba Linda and pissing on it. Well, actually, I had to piss in a spray bottle and then spritz it onto the grave because of the guards, but it sure was fun. Had to wait for the right wind direction, so was kneeling in humble prayer a bit longer than planned, but it all worked out just fine.

roadhazard's picture

I'm jealous, well done, sir.

Dewey Cheatum Howe's picture

Off topic but maybe this is the real reason why JPM is getting out of the EBT business.

Saying some neighborhoods have more pot shops than banks, Colorado Democrats on Wednesday rejected a proposal to ban the use of public assistance cards to obtain cash at marijuana-shop ATMs

The Senate State, Veterans and Military Affairs Committee voted 3-2 along party lines against a GOP proposal to add marijuana shops to the list of places where recipients of public assistance can’t use their government-issued EBT cards to access cash.

The list already includes casinos, liquor stores and gun shops.

Sen. Vicki Marble, R-Fort Collins, said Colorado’s new legal pot industry needs to make sure not to invite federal scrutiny through improper cash withdrawals at recreational or medical marijuana stores.

“Already we are operating an industry which is not allowed under federal law,” said Marble, one of the chief lawmakers involved with Colorado’s marijuana regulation bills.

If federal authorities notice public benefit card use at marijuana shops, “I have a feeling we’re going to see trouble we’re not ready to deal with,” she said.

Democrats on the committee said some neighborhoods have few ATMs, and the Legislature should address those banking deserts before piling on places where public assistance cards can’t be used.

“I’m not comfortable limiting that access until I’m certain we’ve done that due diligence to make sure people can access their benefits when they need to,” Sen. Irene Aguilar, D-Denver, said.

therover's picture

The financial sector is dependent upon the sheeple to believe everything they say and nothing of what they do'



lakecity55's picture

While in the meantime the banksters move East as they have drained the West.

New lands to exploit, bitches!

MeelionDollerBogus's picture

China is an old civilization chock-full of banksters for millenia - just not Rothschild banksters.
There's no room for more to move in.

Save_America1st's picture

All this talk of Chinese gold.  I sure wouldn't want to be Japan and Taiwan anytime in the not so far off future.  Them Chinese, I'm sure, don't forget very easily...and most likely when it comes to the subject of their stolen gold!

Japan looted over 6000 tons of gold from China and Taiwan apparently stole over 100 tons in the mid-40's. 

I'm thinkin' one of these days when the good 'ol U.S.S. of A. can't or won't defend those two islands sitting right next to China anymore, then well...Japan and Taiwan can kiss their asses good-bye.

How One Man Took China’s Gold

Japan might need to worry about a whole other kind of radiation wiping them out if they refuse to fork over what gold they have left. 

therevolutionwas's picture

they can kiss their "assets" goodbye.

logicalman's picture

China might not want radioactive gold.

combatsnoopy's picture

There's much talk in Asia about Bitcoin....
and I quote (from a source):

News: 1.NBA 2 Kings accept bitcoin payments. independent filmmaker community coins to reward users with 3.POS machine manufacturers as the official currency Quezal will be integrated in all products coins collection features 4. Pirate Party Lords believe that coins might rise to 200~500 million dollars/5. United States, "market network" to accept bitcoin payments 6. Premium articles Chicago Sun Web site to accept bitcoin payments 7. Belgium issued coins in the financial sector risks, Belgium bitcoin Association said the news was encouraging sales one-fourth from bitcoin payments 9. Japan Islands private country proclaim coins as the official national currency 10. India hosts accept bitcoin payments 11. foreign media reports United States largest bank Wells Fargo may accept bitcoin 12. Malaysia online store KED.AI accept bitcoin payments 13. United States coins can be used for taxes! 14. Canada real estate developers to accept bitcoin payments 15. maximum bars in New York prepared to accept bitcoin payments 16. Australia's largest cigar retailer to accept bitcoin payments.

lordlyking's picture

Baffin should have a chat with Freed GOLD site author. He seems to be clued in to the BIS element in this whole sorry farce. And he is the only commentator I've seen get price action totally right.

Nothing will come of this investigation. Naturally. The strategy I of the manipulation always was to hasten Bullion East from West. The cry of manipulation and the inevitable consequences has been loud for so many years now. To no avail. The Bullion is where the BIS decided it wants it. Game over!

grekko's picture

Bull!  The game is afoot!  Just see what happens when the COMEX and LBMA vaults run dry.

beegle's picture

amazing ... never seen before ... all the gold shorts going to work in the morning

PaperBear's picture

I don’t expect Germany will ever see their gold that is supposedly in the New York federal reserve ever again.