JPMorganChase And HSBC Allegedly Manipulated Precious Metal Markets

SilverNugget

Silver nugget. Photo: Jurii (CC)

“The conspiracy and scheme was enormously successful, netting the defendants substantial illegal profits” in the billions of dollars  … JPMorgan and HSBC together “controlled over 85 percent the commercial net short positions” … William D. Cohan writes in the New York Times:

As Americans know all too well by this point, commodity prices — for corn, wheat, soybeans, crude oil, gold and even farmland — have been going through the roof for what seems like forever. There are many causes, primarily supply and demand pressures driven by fears about the unrest in the Middle East, the rise of consumerism in China and India, and the Fed’s $600 billion campaign to increase the money supply.

Nonetheless, how to explain the price of silver? In the past six months, the value of the precious metal has increased nearly 80 percent, to more than $34 an ounce from around $19 an ounce. In the last month alone, its price has increased nearly 23 percent. This kind of price action in the silver market is reminiscent of the fortune-busting, roller-coaster ride enjoyed by the Hunt Brothers, Nelson Bunker and William Herbert, back in 1970s and early 1980s when they tried unsuccessfully to corner the market. When the Hunts started buying silver in 1973, the price of the metal was $1.95 an ounce. By early 1980, the brothers had driven the price up to $54 an ounce before the Federal Reserve intervened, changed the rules on speculative silver investments and the price plunged. The brothers later declared bankruptcy.

The Hunts may be gone from the market, but there are still plenty of people suspicious about the trading in silver, and now they have the Web to explore and to expand their conspiracy narratives. This time around — according to bloggers and commenters on sites with names like Silverseek, 321Gold and Seeking Alpha — silver shot up in price after a whistleblower exposed an alleged conspiracy to keep the price artificially low despite the inflationary pressure of the Fed’s cheap money policy. (Some even suspect that the Fed itself was behind the effort to keep silver prices low, as a way to keep the dollar’s value artificially high.) Trying to unravel the mysterious rise in silver’s price is a conspiracy theorist’s dream, replete with powerful bankers, informants, suspicious car accidents and a now a squeeze on short sellers. Most intriguingly, however, much of the speculation seems highly plausible.

For more information, see original article.

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  • Sinchy

    So, buy or sell?

  • Anonymous

    So, buy or sell?

  • Milton

    JP Morg? Manipulating the silver market? NAWWWW.

  • Milton

    JP Morg? Manipulating the silver market? NAWWWW.

  • Anonymous

    Come on, it’s the next “Engineered Boom/Bust” – Buy GOLD … Yeah, it’s a Commodity, not a currency. No set value, only worth what you can get someone to pay for and if you trade a lot of it you run into taxes, liscenses, laws…

    And, check out Mother Jones mag, they’ve got people buying a bunch of stuff that’s going to crash.

    IMO, the guys behind it are going to engineer the crash and in a few years it’ll be 1/4 90s low anyone can sell gold for. And their main customers are right wing gun nuts…

  • greengestalt

    Come on, it’s the next “Engineered Boom/Bust” – Buy GOLD … Yeah, it’s a Commodity, not a currency. No set value, only worth what you can get someone to pay for and if you trade a lot of it you run into taxes, liscenses, laws…

    And, check out Mother Jones mag, they’ve got people buying a bunch of stuff that’s going to crash.

    IMO, the guys behind it are going to engineer the crash and in a few years it’ll be 1/4 90s low anyone can sell gold for. And their main customers are right wing gun nuts…