Remember back in 2010 when Alex Jones and Max Keiser were trying to persuade people to wipe out JP Morgan by buying silver? And then in 2011 the New York Times got in on the act, describing a putative conspiracy by JPM and HSBC to manipulate the price of silver. Well nothing much has happened to develop the theory despite the megabank doing its best to blow itself up by allowing the London Whale’s massively rogue trading. Kevin McElroy of ETF Daily News says it was all baloney anyway:
I promised I would stay on top of the “silver manipulation” story – and there’s another wrinkle in this story to share. The Financial Times reported yesterday that the Commodity Futures Trading Commission (CFTC: the federal government’s regulatory body in charge of U.S. commodities trading) will drop its investigation into silver futures manipulation.
Before I get into it, you might recall that the specter of the precious metals conspiracy theory goes back far beyond this latest story, and further back even than the Hunt brothers’ infamous plot to corner the market on silver in the early 1980s – which really happened, by the way.
Unfortunately, unlike the Hunt brothers’ saga, most of these stories don’t need to be remotely true or even plausible in order for investors to fall for them.
The legend of lost or missing or stolen hoards seems to transcend time as well as our ability to think rationally. Maybe like fire and sweet food, the ideas of mislaid gold and silver are so intertwined with our cultures and DNA that we’ll never escape them.
As they say, conspiracy theories are better than sex – though I suspect that’s because conspiracy theorists aren’t in the market to have sex, so they’re forced to settle for conspiracies…
In any event, it’s morally satisfying to blame someone else when you don’t get the immediate gratification you seek from your investments.
That’s why I think many otherwise rational people are so quick to blame big bad banks like JP Morgan (NYSE:JPM) when they didn’t immediately become super rich from their silver holdings.
Apparently it’s not enough that – in spite of weakness over the past year – silver has still nearly doubled in price over the past few years, and has nearly tripled in five years…
[continues at ETF Daily News]