Bart Spills the Beans

Sooner or later it had to happen. I mean, you can’t keep a lie going forever [unless of course you’re talking about the “grassy knoll”].

In a stunning admission that the CFTC is nothing more than a repository for resumes on your way to a better, more corrupt profitable high paying government job, Commissioner Bart Simpson Chilton admitted in a speech on December 8, 2010 that the CFTC “had proof” that one trader held more than 40% of the open interest in the silver futures market.

Really Bart?

And pray tell readers, who do you suppose that might be? I’m sure JP Morgan is putting no pressure on the toothless, ineffective and corrupt CFTC to suspend or delay position limits, or other regulatory measures that might actually prevent markets from being manipulated. Why, this is Amerika.

Except for being the first time it actually did anything, can you think of any reason why the CFTC would drag its collective feet? Hey, if it was you or me that held 40% of the entire short position in a market, do you think for one minute they wouldn’t be crawling up our ass demanding to know what we were doing and why, and then forcing us to liquidate? All in the name of “fairness” don’t you know.

Well, imagine for a hypothetical minute what would happen if JPM had to exit all those shorts. Silver exactly where in price 2 minutes after this is announced?

So, you can imagine the financial ass-whipping that would ensue. We can’t have this in “free markets”. “How do you expect us to make money and spend part of it on government corruption if you don’t allow us to manipulate a market?”

Back in the fall of 2008, I was told that if I voted for McCain, fat-cat “Wall Street types” would ruin the markets by stampeding the “little guy” into oblivion and ruining it for everybody. Hey, they were right!

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Get Ready Mr. Morgan

It’s gonna get interesting in the next few weeks. If J.P. were alive today he would surely have his panties in a bunch. Never one to stand idle while his firm takes a hit, I’m betting he would be a tad madder than the above photo indicates.

Unable to continue manipulating the silver and gold markets due to various class-action lawsuits and CFTC scrutiny, the clock is ticking ever faster to the December delivery clusterfark for messengers Morgan & HSBC.

On Monday, open interest in Dec. silver stood at approximately 17,000 contracts [86,000,000 oz.]. The Comex [division of CME] reports approximately 48,000,000 oz.  available for delivery. Open interest in Dec. gold stood at approximately 59,000 contracts [5,900,000 oz.]. The Comex reports approximately 2,600,000 oz. approved for delivery.

I got in touch with my chief math guy, Jethro Bodine, just to make sure I wasn’t fudging the numbers. After showing me [for the umpteenth time] his diploma, he assured me naught from naught is still zero and subtracting a higher number from a lower number means you got problems.

With all the POMO [Permanent Open Market Operations] by the Weimar Fed, they’re gonna need all the printed money they can get from “Helicopter” Ben to stem the ass-kicking they’re gonna get come delivery.

Of course, they can always deliver the physical metal, but that is becoming somewhat of a problem since deliverable product is scarce. Instead, expect the dual evil empires to kick the can down the road to Feb. 2011 [gold] and March 2011 [silver], hoping like hell we get a break so they can cover.

If that doesn’t work, expect the next bank bailout at the end of Q1 2011. Soooooooo sorry Mr. Morgan, you lose!!

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I am shocked, SHOCKED!

Remember the classic scene in the movie “Casablanca” where the head Nazi wants Rick’s nightclub to be shut down? And so, with Humphrey Bogart standing there wondering what the hell is going on, Claude Rains announces “I am shocked, shocked that there is gambling going on in this establishment”. Then immediately, Peter Lorre walks up and says “here are your winnings for the night”.

So, I know many of you are going to have to suspend disbelief at what I am about to announce. In good conscience I have to warn you with the following:

 Yesterday, in the Southern District Court of New York, plaintiffs Brian Beatty and Peter Laskaris [cases 10-08146 and 10-01857] sued J.P. Morgan and HSBC for MANIPULATING THE SILVER MARKET.

The reaction, upon hearing this news, of random passerby’s out my front window pretty much says it all:

Defendants are accused of the following [from the complaint]: 

                         "between in or about March 2008 and continuing through the present, Defendants have  combined, conspired and agreed to restrain trade in, fix, and manipulate prices of silver futures and options contracts traded in this District on the COMEX division of the NYMEX. Defendants thereby have violated Section 1 of the Sherman Act, 15 U.S.C ¶1. Also during the Class Period, individual Defendants have intentionally acted to manipulate prices of COMEX silver futures and options contracts. Such conduct violates Section 9(a) of the Commodity Exchange Act, 7 U.S.C. ¶13b."

What makes this case so interesting, besides the various allegations, is that the plaintiffs seek class action status. So, all you guys who have traded silver since March 2008 and lost money, here is your “lottery ticket” for remuneration plus treble damages.

What’s the world coming to when two of the largest market manipulators and crooks most respected Wall Street firms get accused for simply “making a market”?

Exit question: where the hell are the CFTC, NFA, SEC, and the Treasury Department? Oh wait, that’s right I remember; they watch porn for 8 hours a day from their office computers. You gotta have priorities after all.

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