JP Morgan silver probe dead in the water, CFTC sides with the bankers

Two weeks after Bart Chilton, a member of the U.S. Commodity Futures Trading Commission, said that “I am hopeful and expect the silver investigation to conclude in the not-too-distant future, hopefully in September or October…It has already taken far too long,” the probe by the CFTC into silver price manipulation is coming to an end. The CFTC will not investigate allegations that the silver price is manipulated by major financial powerhouses, in particular JPMorgan, whose death-by-a-thousand-cuts year might see their Too Big To Fail status tested and endure.

Chilton has come out hinting at the truth, having said that he has seen “repeated attempts” to influence prices. Any follower the price of silver is well-aware with the at times very predictable behavior of the silver price which does not fall in-line with natural trading.  In concert, floods of paper will overwhelm the futures market, causing the silver price to fall dramatically. The only commodity cheaper today than it was in 1980, silver came under intense manipulation by international finance as the Hunt brothers tried to corner the markets at banks hedged the loans they provided the brothers with short positions in silver. They’ve kept these positions ever since, and it has caused a deep influence in the way the metal trades.

“There have been fraudulent efforts to persuade and deviously control that price,” Chilton said at an October 2010 hearing in Washington. “Any such violation of the law in this regard should be prosecuted.” But, JP Morgan will not prosecuted. The bank has a long heritage behind the veneer of democracy in the United States, and has developed well-enrenched influence over the nation’s political processes. JP Morgan himself sat on the board of upwards of 50 corporations in the second half of the 19th century, and this sort of insidious influence has put made JP Morgan invincible.

The Financial Times released the story today that the four-year investigation into the possible manipulation of the silver market looks like it is going to be dropped after US regulators did not find enough evidence to support a legal case, in spite of the fact that none of the audited information has been made public. The secrecy of the silver manipulation suggests that this scandal is more at the heart of the global financial system is as the LIBOR fixing scandal. In other words, it is more important that the poor man’s gold remains volatile, risky and controlled so as to avoid a reorientation of global savings. The war on silver is a well documented reality, as the United States experienced in the Crime of 1873, again with silver nationalization in 1933, and enunciation by the Silver Users Association – an association of major industrialists and other businesses whose businesses are dependent on silver – in the early twentieth century indicating that hoarding by India of the metal was a concern.

The Commodity Futures Trading Commission began investigating “complaints of misconduct in the silver market” in September 2008, and along the way renowned silver investors like Bill Murphy of GATA testified about the abuses against free markets:

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In 2010, Bart Chilton, a CFTC commissioner, believed that there had been “fradulent efforts” to “deviously control” the silver price. But, after being consulted by two “external consultancies,” CFTC has determined it does not have sufficient evidence to move forward with a case. The  agency’s five commissioners have not come forward with their outcome, which leaves open the possibility of future actions. A CFTC spokeman indicated that the investigation had not yet been concluded, though he declined to go further into the case. “I’m sure it will be met with some concern from a certain group of aggressive silver speculators,” said one person close to the case.

According to the Financial Times, the CFTC has analysed over 100,000 documents and interviewed dozens since it began probing the allegations in 2008. The evidence apparently included records from JPMorgan. But, having been paidoff and threatened or told to ignore this, the CFTC has epically failed to produce any evidence, even though it does not take much imagination to realize that considering the vast assaults on pricing mechanisms world wide via central bank policy, derivative speculation and interest rate manipulation and insider trading, of course the silver price is affected. Bring in the socio-historical dynamic, that it has been before money, the money of the people, and you see that it is a dangerous asset as a competition to the dominant medium of control, the Federal Reserve Note.

A class-action lawsuit still pends against the Morgue. Lawyers for the bank have asked a judge to dismiss it. There is no evidence of a single manipulated trade, they claim.  The CFTC has been pressured to go after potential silver manipulators on multiple occasions, such as in 2005 and 2008.  They “found no evidence of wrongdoing.” But, the custodian of the COMEX, where SLV silver holdings are held, it is very clear that the role JP Morgan plays is major. HSBC already got off the hook of the investigation in the fall of last year, but JP Morgan was kept around for the ride, for the distraction, for whatever reason. Now, their fate is similar to HSBC.

The coming conclusion of the silver probe is not a surprise at all. Of course silver will remain manipulated. THE CFTC, the COMEX, JP Morgan, the CME are all unaccountable to the people. Money talks, and what is too sensitive to remain for too long in the public light will be silenced until it is convenient to let the information surface. The facade of the dollar is what must remain, and so all precious metals – again, especially the “poor man’s gold” – must be pushed to the periphery of economic insights. They are not a viable option to save money in. The banks do not want to starve. So, the mainstream press outlets they control tell us that conservative mutual funds, despite that billions in investor money has been lost, and cash are where to best store value.

The fundamentals of the precious metals markets clearly spell a long-term bull market. Silver is expected by most to outperform gold, but they have been disappointed at an outcome that was hard wired into the pricing mechanisms of the metal. There is no freely traded silver market, and we will not be seeing one for some time to come. The silver price today is off nearly 50% from its 1980 and 2011 highs. It trades in a range so narrow, it is as if the metal is traded in a ghosttown.  Algorithmic handcuffs have been placed on silver and the key will not be turned any time soon. The false supply of paper silver, as anyone who follows the future markets, has successfully managed the silver price in a way so as to not psychologically stimulate the buying public. The “commercial hedgers” in the paper markets of unallocated accounts, a.k.a financiers in disguise, have led to an illusion of silver supply, while in the process creating a shortage.  JP Morgan and other banks have oversold the amount of silver in the world. This scam will not be politically unraveled, this time.

One day, though, the magnitude will be realized by the markets and public, and the demand for silver willoverwhelm the artificial suppression. The Silver Liberation Army best start organizing.

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