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CME, Reuters Picked To Replace Silver Fixing In Process Supervised By Former Gold Fixer

Tyler Durden's picture




 

A few days ago we reported that the World Gold Council was actively preparing to announce the replacement to the existing gold/silver fix, a system that had allowed the rigging of precious metals for 117 years. Confirming that said rigging would only continue was our report that the person who chaired said WGC "round table" meeting was none other than the former Bank of England Chief Manager of Reserves (which included gold of course), and who was at his post when Gordon Brown dumped half of England's gold at ridiculous prices merely to bail out one or more banks that were short physical metal (curious how that is such a recurring theme) and were scrambling to obtain the delivery. That's where Brown and the BOE came in.

Today we learned just what said "fixing" replacement will look like after reports that the CME Group Inc. and Thomson Reuters, largely as had been expected, will run the replacement for the 117-year-old silver-fixing benchmark that’s ending in August, the London Bullion Market Association said. 

Confirming that the "selection process" was nothing but yet another rigged farce, designed solely to preserve continuing of manipulation, was this disclosure (ironically coming out of Reuters, the same company picked to continue the fixing):

"In the end, we had a workable structure, and two large organisations with plenty of experience behind them in terms of systems and compliance, and regulatory issues," said Jonathan Spall of G Cubed Metals Ltd, which conducted an independent review for the LBMA as part of the selection process.

Jonathan Spall....Jonathan Spall.... where have we heard that name? Oh yes, recall: "From Rothschild To Koch Industries: Meet The People Who "Fix" The Price Of Gold" in which we reported:

Jonathan Spall, who also has quite an extensive LinkedIn profile.

 

 

Alas, Mr. Spall won't be at Barclays, or the fix, for long. As Bloomberg reported in January 2014

 

Barclays Plc cut commodities jobs in London and New York as part of reductions in fixed income, currencies and commodities, according to two people familiar with the matter. Bharath Manium, a managing director in commodities structuring, Paul Jackman, a managing director in the commodities index business, Jonathan Spall, product manager for metals in London, and Sudakshina Unnikrishnan, an analyst in London, are leaving, according to the people who asked not to be identified because the move hasn’t been made public.

 

In fact as was reported by London Gold Market Fixing Ltd, Mr. Spall is no longer with the company since April 9, 2014.

In other words, the person in charge of navigating the "transition" from the old fixing mechanism, of which he was part as recently as April, was a person who was, drumroll, supervising said transition. Surely, his "consulting" was fair and impartial. Naturally, Mr. Spall is no longer at gold-rigging Barclays, a bank which is for all intents and purposes, falling apart but at GCubed Consultants: enjoy perusing the company at the following link.

Said another way, one of the Barclays guys who was accountable in the Gold Market Fixing Company for the price manipulation of his trader (the infamous Daniel Plunkett) is then rewarded by the LBMA to conduct an independent review of the applicants to run the Silver fix!

To be sure, some are optimistic that the appointment of the CME and Reuters will be an improvement:

“We look forward to using the new fix when buying silver on behalf of clients,” Mark O’Byrne, a director in Dublin at brokerage GoldCore Ltd., said today by e-mail. “Having Thomson Reuters and CME as fix operators is better than a handful of banks.”

 

Comex, owned by CME Group, traded 14.48 million silver futures contracts and 47.29 million in gold futures last year, according to the Washington-based Futures Industry Association. CME, the world’s biggest derivatives bourse, also offers platinum and palladium contracts, according to its website.

 

“CME through Comex has a huge part of the financial silver market,” Brian Lucey, a finance professor at Trinity College Dublin, said by phone today. “Thomson Reuters, like Bloomberg or like other trading systems, captures the over-the-counter market very well. LME is big for industrial metals, but not precious.”

We are far less septical.

As for further "concerns" of gold and/or silver manipulation, don't worry, those died with that one single, solitary Barclays trader:

While there’s “no clear evidence” of manipulation during the London gold fixing, it’s possible it occurred, David Bailey, director of financial markets infrastructure and supervision at the FCA, said at a U.K. Treasury Select Committee hearing July 2. The regulator has been visiting member banks involved in the gold fixing this year as part of its review of gold benchmarks, a person with knowledge of the matter said in April.

Sure why not. The only problem: if there was no manipulation besides Barclays, then just why is Deutsche Bank in such a rush to put as much distance as possible between itself and any trace it ever was involved in the fixing process: "Deutsche Bank has already exited the gold fixing, leaving Societe Generale SA, Bank of Nova Scotia, HSBC and Barclays as the four remaining members of the process which takes place twice daily and dates back to 1919."

Considering the recent escalation in relations between Germany and the US, we are confident we will find out soon enough...

 

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Fri, 07/11/2014 - 11:37 | 4947197 Canadian Dirtlump
Canadian Dirtlump's picture

To me this is all banter. The communist mongoloid exchange will no doubt do a shitty job, but until paper contracts stop being allowed to be dumped at quiet market times this shit won't end.

Fri, 07/11/2014 - 11:39 | 4947200 linniepar
linniepar's picture

Paper is poverty.

Fri, 07/11/2014 - 11:48 | 4947219 BaBaBouy
BaBaBouy's picture

CHEAP PM METALS FOR EVERYONE.!.

Until... There Is No More CHEAP METALS To Be Had...

Fri, 07/11/2014 - 11:55 | 4947242 BaBaBouy
BaBaBouy's picture

CHEAP PM METALS FOR EVERYONE.!.

Except For The GERMANS, Who Still Fantasize That They Have Actual GOLD Stored At The FEDdy...

Fri, 07/11/2014 - 11:57 | 4947266 Thought Processor
Thought Processor's picture

 

 

Is there any price that isn't rigged now?

 

Just sayin.

Fri, 07/11/2014 - 12:07 | 4947277 Pinto Currency
Pinto Currency's picture

 

 

The discussion of the daily Gold / Silver Fixing is a distraction from the central issue.

They are trading notional digital gold and silver not the metal itself:

http://jaytaylormedia.com/media/DavidJensen20140708.mp3

Palladium is trading today at a $137/oz premium in Shanghai and platinum is trading at a $94 premium to NY / London derivatives market.

But that would be the metal itself.

http://www.sge.sh/publish/sgeen/

http://en.shmet.com/

Fri, 07/11/2014 - 12:31 | 4947362 Herd Redirectio...
Herd Redirection Committee's picture

 “CME through Comex has a huge part of the financial silver market,” Brian Lucey, a finance professor at Trinity College Dublin"

What is financial silver exactly, fellas?

Fri, 07/11/2014 - 12:39 | 4947381 NidStyles
NidStyles's picture

Certificates representing silver?

Fri, 07/11/2014 - 13:11 | 4947479 imaginalis
imaginalis's picture

The end to all this will come when there is nothing left to rig after rigging itself is rigged.

Fri, 07/11/2014 - 13:21 | 4947532 SafelyGraze
SafelyGraze's picture

reuters?

who owns reuters, anyway?

 

Fri, 07/11/2014 - 13:24 | 4947542 dracos_ghost
dracos_ghost's picture

I know. The NWO isn't even trying to be cute anymore. Rothschilds for the win. Fuk.

Fri, 07/11/2014 - 13:26 | 4947553 Pinto Currency
Pinto Currency's picture

 

 

 

CME / Reuters are marketing buggy whips while the market is moving to Ferraris.

Fri, 07/11/2014 - 14:04 | 4947734 SoilMyselfRotten
SoilMyselfRotten's picture

They won't be able to fix the price when there is no silver to be had. Have a feeling that time is fast approaching.

Fri, 07/11/2014 - 12:54 | 4947420 Thisson
Thisson's picture

Silver futures traded on the Comex.

Fri, 07/11/2014 - 13:20 | 4947525 Pool Shark
Pool Shark's picture

 

 

Meet the new boss,

Same as the old boss...

 

 

Fri, 07/11/2014 - 11:58 | 4947272 Al Huxley
Al Huxley's picture

Maybe they should send some representatives over to the States and start buying inventory out of the coin shops.  That will be a faster way to get it back.  Granted, they'll be repaying for something they already paid for once, but at least they'll have some gold.

Fri, 07/11/2014 - 12:39 | 4947380 NidStyles
NidStyles's picture

They could trade those worthless IUO's in the form of T-bills for something tangible then at least. Even if it's a loss it's better than never getting a return on those bills or the gold that doesn't exist. 

Fri, 07/11/2014 - 13:44 | 4947658 Harbanger
Harbanger's picture

“The Americans are taking good care of our gold, we have no reasons for mistrust,”

Nobert Barthle, the German Parliament Budget spokesman, July, 2014

Fri, 07/11/2014 - 12:11 | 4947302 Space Animatoltipap
Space Animatoltipap's picture

Indeed, many are not interested in the viable financial solution having the determined preference to remain ignorant slaves. But at the same time they have so many complains about government, bankers etc. etc. Funny situation ...

Fri, 07/11/2014 - 11:45 | 4947221 Pladizow
Pladizow's picture

Its only a collapse into revolution that will end this!

Fri, 07/11/2014 - 12:22 | 4947343 Canadian Dirtlump
Canadian Dirtlump's picture

You certainly are conceptually right, and judging by my sore ass, and chronic irish sunglasses, as a silver stacker, I agree with you.

We've been sitting outside the nightclub in our lawnchairs waiting for the fire to break out and watch people in a panic trying to leave now for a while. My heart is ennobled that we are perhaps close.

Fri, 07/11/2014 - 12:06 | 4947292 Kaiser Sousa
Kaiser Sousa's picture

they have lost control and they know it...
the buying of physical continues on exploding demand by those who understand that the Crimex is nothing more than a hologram for the uninformed muppets whose debt coupoon dollars march toward total worthlessness...

the attempts to manage economic perspective via the relentless paper attacks on the only 2 forms of real money while pumping up the Fraud Markets has failed to convince even the most clueless EBT recipient to "dont worry be happy" cause "every little things'gonna be alright..."
the farce is up assholes.

To the MoneyChangers...
U R FUCKED.....

we stack...NOW FUCK OFF AND DIE.

Sat, 07/12/2014 - 19:13 | 4950991 Cacete de Ouro
Cacete de Ouro's picture

Just to note that David Bailey of the FCA has also been rewarded for his snivelling servitude to HMT and the Bank of England by being made a director of the Bank of England. ie He looked the other way on the gold manipulation issue. If you meet David, be sure to ask him how he felt when he faut squirmed during the House of Commons Committee hearing, which was a pantomime by the way. They didn't even mention that master David had already left the canary wharf FCA office for the more salubrious surroundings of The Old Lady.

Fri, 07/11/2014 - 11:38 | 4947198 linniepar
linniepar's picture

New boss same as old boss. Stack on.

Fri, 07/11/2014 - 11:39 | 4947203 dontgoforit
dontgoforit's picture

Termites running the plywood shop!

Fri, 07/11/2014 - 11:41 | 4947207 Juno Rock
Juno Rock's picture

From one gang of crooks to another. Same, same, different uniforms. Business as usual. 

Move along please. Nothing to see here. 

Fri, 07/11/2014 - 11:41 | 4947208 RealityCheque
RealityCheque's picture

Better do it right Spall, otherwise there's a nailgun out there with your name on it.

Fri, 07/11/2014 - 11:41 | 4947212 pods
pods's picture

Morpheus, can you please pick up the white courtesy phone?

Thanks,

Coppertop

Fri, 07/11/2014 - 11:44 | 4947220 chinaboy
chinaboy's picture

The fix for the fix is fixed -- Gold fix fixed 2.0.

Fri, 07/11/2014 - 11:49 | 4947229 BrigstockBoy
BrigstockBoy's picture

So where does Douglas Beadle fit into this Tyler? You know, the former Rothschild banker that Bloomberg reported was acting as consultant to the fix as of last November...

Fri, 07/11/2014 - 11:50 | 4947235 Australian Economist
Australian Economist's picture

<-- Fix Fixed

<-- Fixed Fix

Fri, 07/11/2014 - 11:54 | 4947252 SWCroaker
SWCroaker's picture

This is all about cultural language and the preference for ordering modifiers.   For some people, "Throw the cow over the fence some hay" is right as rain.

Fri, 07/11/2014 - 11:50 | 4947237 SHEEPFUKKER
SHEEPFUKKER's picture

Chicago Margin(hike) Exchange

Fri, 07/11/2014 - 11:52 | 4947245 Peter Pan
Peter Pan's picture

The problem is not the manipulators. The real problem is the widespread stupidity amongst their victims that seems to persist despite consant and repeated assaults on their wealth as well as their intelligence despite the avalanche of evidence.

Fri, 07/11/2014 - 11:55 | 4947258 SWCroaker
SWCroaker's picture

I don't think I'm stupid.   Just bruised, stubborn, obstinante, determined, disgusted, and a little surly.     But not stupid.

Fri, 07/11/2014 - 11:55 | 4947254 Conax
Conax's picture

The Chicago Metals Exchange is probably THE most honest and trustworthy fixers in the paper PM rackets!  After all, Chicago is known for its integrity in all things, political or business.

Thank God we finally got people of integrity to rig the price of phyzz for us every day.  This has restored my confidence enough to go out there and short the hell out of gold and silver from now on, KUDOS to the WGC for taking this first brave step into the honest and above-board new world of phyzz fixing.

For a minute there I thought they would hand this responsibility to GATA or maybe the Mormons. Shew, that was close!

Where my reds at?

Fri, 07/11/2014 - 11:54 | 4947256 Colonel Klink
Colonel Klink's picture

I guess it takes a crook to stop a crook, as if there's any intention to stop the criminal behavior.  All lipstick being painted on this pig.  Nothing changed until heads literally begin to roll.

Fri, 07/11/2014 - 11:55 | 4947259 Al Huxley
Al Huxley's picture

Fuck them.  As long as there's still metal available, they'll keep it on sale.  No point complaining about it, better just to take advantage, it's one of the few cases where the criminals lose their ability to control the retail - buy bullion and put it away and there's no overnight futures dumping or HFT magic they can perform to get it back.

Fri, 07/11/2014 - 11:55 | 4947262 Gringo Viejo
Gringo Viejo's picture

The cartel can buy forward production, they can count ore in the ground as inventory, they can blitz with short paper but eventually, they have no metal to trade when needed.

Fri, 07/11/2014 - 12:01 | 4947283 SHEEPFUKKER
SHEEPFUKKER's picture

Good point. The question is, how far out in the future can they buy ore in the ground? 6 months? A year? 10 years? Rehypothecated ore in the ground even?

Fri, 07/11/2014 - 12:06 | 4947296 Gringo Viejo
Gringo Viejo's picture

@SHEEP I'm sure your aware, but I seldom see it mentioned, that it's always in the State's interest to keep commodities at or below the cost of production to enable the survival of fiat regimes. This is why so many farmers and miners go bankrupt.

Fri, 07/11/2014 - 11:56 | 4947264 Amish Hacker
Amish Hacker's picture

This should streamline the front-running of customers nicely, without any interruptions to the process.

Fri, 07/11/2014 - 11:57 | 4947267 LostandFound
LostandFound's picture

The only thing that will stop this manipulation will either be a global economic collapse or the ever increasing number of people waking up to reality and buying PM's outside of the system leaving paper gold only. More and more people are becoming unplugged outside of this ponzi scheme.

Fri, 07/11/2014 - 12:00 | 4947278 _ConanTheLibert...
_ConanTheLibertarian_'s picture

"We are far less septical."

Well, this septic tank is full of shit.

Fri, 07/11/2014 - 12:00 | 4947280 oklaboy
oklaboy's picture

<------ some folks screed

<----- everyody screwed

Fri, 07/11/2014 - 12:02 | 4947286 SilverIsMoney
SilverIsMoney's picture

I cannot get my parents to stack because they're convinced if we're right it will be confisicated. What's the counter argument to that? What about a gigantic windfall tax? There's many ways they will try and screw us. Stacking is a state of mind - it's your consent being withdraw from the system. That's why you do it.

Stack silver, and some gold if you can!

Fri, 07/11/2014 - 12:12 | 4947307 Conax
Conax's picture

Petty stackers are such a rare type there won't be enough metal in their hands to bother with a big confiscation.  I only know one other person that has any silver at all, and I sold it to him.

Silver, being a useful commodity and used in virtually every consumer product would be extremely difficult to just outlaw.

Tell them to go for silver. 

Fri, 07/11/2014 - 12:38 | 4947379 Herd Redirectio...
Herd Redirection Committee's picture

Here's the counter argument.  Have a backyard?  Have you seen the size of a 400 oz gold bar?

Now how to apply 'metal detection noise' best is a good question.  Sprinkle nails every couple feet, under the dirt?  Old pennies?  Some might be willing to go as far as constructing a pond, if you get my drift.

Fri, 07/11/2014 - 13:25 | 4947546 Pure Evil
Pure Evil's picture

The fact is they can also confiscate your fiat accounts.

At least with PM's you can make them do a little work to confiscate your shiney whether from the bottom of a lake or buried in your back yard.

Fri, 07/11/2014 - 23:25 | 4949264 flyingcaveman
flyingcaveman's picture

Nails are easy to discriminate out even with a basic metal detector, I would go with aluminum pull tabs, nickles and copper pennies.  Probably not going to fool a high end detector that is meant for looking for gold though.

Fri, 07/11/2014 - 12:12 | 4947308 Colonel Klink
Colonel Klink's picture

If I have to, I'll take my metals out of the country.  Zer are vays!

Fri, 07/11/2014 - 12:19 | 4947330 F.A. Hayek
F.A. Hayek's picture

I look at the following as benefits:

1-The ultimate middle finger to the fiat printing, currency debasing central banks

2- Removal of fiat off of the personal books at the retail banking system

  Secondary benefit: The xx dollars won't be multiplied into xx10 dollars or whatever the fraction banking du jour is

3- If the system goes down, there is something else to barter in additon to services or other goods

4- FU Mr. Yellen!

Fri, 07/11/2014 - 12:47 | 4947397 lasvegaspersona
lasvegaspersona's picture

Prior confiscation was done when gold WAS money. Today very few people hold physical. It will be easier for the government to just buy gold with the 'new dollar' when that time comes.

Also, in Europe gold investment is not taxed. If the US were to tax it then gold would be smuggled to places where it is treated better.

Gold used to be concentrated in bamks. Roosevelt had no trouble getting all of it in 1933. Today it would require armies to get a few ounces from all the few small holders. Won't happen....besides all the people who actually own gold already have their story of how they tragically lost it. Gambling, lost treasure map. faulty GPS devise, boating accident, thieving relatives....come on folks add to this list.

Fri, 07/11/2014 - 12:56 | 4947429 F.A. Hayek
F.A. Hayek's picture

Shots of gold enhanced goldschlager

followed by blackouts then amnesia

Fri, 07/11/2014 - 13:00 | 4947440 Bastiat
Bastiat's picture

Thus US does tax capital gains in gold and silver but taxes them at a flat 28% rate as "collectibles."  No long term cap gains treatment.  Ron Paul introduced several bills over the years to change this but they never got out of committee.

Fri, 07/11/2014 - 21:38 | 4949043 BooMushroom
BooMushroom's picture

No capital gains if you bought it all at $50 an ounce...

Fri, 07/11/2014 - 13:36 | 4947606 crazybob369
crazybob369's picture

Why go to the effort of locating and confiscating gold when with a keyboard click they can consficate your bank account; brokerage account; IRA; 401K. They always go after the low hanging fruit first.

Fri, 07/11/2014 - 12:27 | 4947356 D-liverSil-ver
D-liverSil-ver's picture

Pick a porn star to ensure the virginity of young girls..  Sounds reasonable.

Fri, 07/11/2014 - 12:34 | 4947370 SubjectivObject
SubjectivObject's picture

Thomson Reuters ... that's a Roth operation, isn't it.

There's a pattern here.

Fri, 07/11/2014 - 13:28 | 4947388 Joebloinvestor
Joebloinvestor's picture

Don't fucking complain about the governments "revolving door".

 

The whole system is corrupt.

Sat, 07/12/2014 - 08:17 | 4947404 Cacete de Ouro
Cacete de Ouro's picture

Jonathan Spall
G CUBED METALS LIMITED
77 THE SHEARERS
BISHOP'S STORTFORD
HERTFORDSHIRE
ENGLAND
CM23 4AZ

Fri, 07/11/2014 - 12:58 | 4947433 Mercuryquicksilver
Mercuryquicksilver's picture

What does it take for Miners to wake up and start hiring hitmen?

Fri, 07/11/2014 - 13:02 | 4947448 Bastiat
Bastiat's picture

Never happen but fewer sell forward than they did years ago.

Fri, 07/11/2014 - 14:35 | 4947844 Conax
Conax's picture

They would, but at these prices they don't have the money.

Fri, 07/11/2014 - 13:37 | 4947610 goldhedge
goldhedge's picture

I hope that the next time we read about Jonathan Spall is that he commited suicide by jumping from a 30 storey window clutching a nail gun.

Fri, 07/11/2014 - 13:37 | 4947615 RaceToTheBottom
RaceToTheBottom's picture

The main thing this convinces me is that Singapore has a monumental opportunity to build a marketplace based only on NOT Repothicated PMs.

I hope they don't waste it and speed up.

Separation of paper, fictional sales and physical sales has to occur.

Fri, 07/11/2014 - 13:49 | 4947678 crazybob369
crazybob369's picture

If you own/accumulate PM's you have two major forces working for and against you. The force working for you is that PM's are a finite resource which is becoming increasingly more difficult, and expensive to find and mine. Inevitably, the price must, and therefore will, increase. The force working against you is time. For us older folk the question is; will I live long enough to see my efforts bear fruit? Maybe not; but at least my son will. My true fear, however, is that a world of $5,000 or $10,000 gold will be a scary place indeed.

 

Fri, 07/11/2014 - 14:03 | 4947731 ronron
ronron's picture

jeffrey fucking christian? i hate that crooked cunt.

Fri, 07/11/2014 - 14:05 | 4947743 Cheduba
Cheduba's picture

Publications: How to profit in gold

Was the book six words long?

"Control the fixing of the price."

Fri, 07/11/2014 - 14:45 | 4947869 SonoftheAR
SonoftheAR's picture

Illegally rig the price of gold so that your "investments" always "win."

Profit.

Write a book on how to profit from investing in gold.

Profit.

Rinse, repeat.

Profit.

Fri, 07/11/2014 - 15:15 | 4947967 GoldenDonuts
GoldenDonuts's picture

Not sure why a fix is required.  Why not use a market price?

Fri, 07/11/2014 - 15:15 | 4947968 GoldenDonuts
GoldenDonuts's picture

Not sure why a fix is required.  Why not use a market price?

Fri, 07/11/2014 - 16:27 | 4948237 imbtween
imbtween's picture

Lol, why not just get Nadler formerly of kitco to do it?

Fri, 07/11/2014 - 21:21 | 4949005 f16hoser
f16hoser's picture

Keep stacking! These prices are a Gift from the Gods!

Sat, 07/12/2014 - 18:56 | 4950957 Cacete de Ouro
Cacete de Ouro's picture

Tyler...

"We are far less septical."

Surely you mean "We are far more sceptical."?

Or perhaps, wearing an American hat, "We are far more skeptical."?

But undoubtably you are 'far less septical' than those 'septics' who, being septic, believe that the new silver fix is not going to be manipulated.

Do NOT follow this link or you will be banned from the site!