A Former NYMEX Trader Explains “The Mechanics Of Silver Manipulation”

The Mechanics of Silver Manipulation
JPMorgan Chase on Wednesday won the dismissal of three private antitrust lawsuits, including from hedge fund manager Daniel Shak, accusing the largest U. S. bank of rigging a market for silver futures contracts traded on COMEX. The lawsuits accused JPMorgan of having in late 2010 and early 2011 placed artificial bids (i.e., spoofing) onto the trading floor, harassed employees at metals market COMEX to obtain prices it wanted (i.e., intimidation) and made misrepresentations to a committee that set settlement prices. (i.e., manipulating settlements).
What follows is how JPM manipulated the silver markets by selling the Silver contango during illiquid hours, then used their deep pockets to push settlements, then waited until margin calls made the large locals puke their positions. JPM in effect stretched the relationship between forward rates and futures spreads until they made no sense anymore. Not unlike a company trading at 50x earnings. It cannot last long. But it only has to last long enough until the guy with the position opposite you has to liquidate. That guy does not have access to cheap money, political influence or the most physical silver in the world in a single vault at his disposal to create a squeeze.

This post was published at Zero Hedge on Jul 3, 2016.

“We Won’t Be Lectured” – Italy’s Renzi To Defy Brussels Over Banking Bailout

With all eyes distratcted by the post-Brexit euphoria, the last week has seen a far more existential crisis accelerating in Europe. Italy’s banking system is in tatters (from a EUR40bn bailout 6 days ago, to EUR150 emergency support 3 days ago, to a bank bailout and chatter of further support from pension funds Friday) but, in what seems like a clear admission that things are really bad, The FT reports that Italian prime minister MatteoRenzi is prepared to defy the EU and unilaterally pump billions of euros into its troubled banking system if it comes under severe systemic distress, a last-resort move that would smash through the bloc’s nascent regime for handling ailing banks.
As we noted previously, Brexit will be just the scapegoat used by Renzi and Italy to circumvent any specific eurozone prohibitions. And if it fails, all Renzi has to do is hint at a referendum of his own. Then watch as Merkel scrambles to allow Italy to do whatever it wants, just to avoid the humiliation of a potential “Italeave.”
And sure enough, as The FT reports, Matteo Renzi, the Italian prime minister, is determined to intervene with public funds if necessary despite warnings from Brussels and Berlin over the need to respect rules that make creditors rather than taxpayers fund bank rescues, according to several officials and bankers familiar with their plans.

This post was published at Zero Hedge on Jul 3, 2016.

German Arms Exports Nearly Double In 2015

The US isn’t the only country to can crank up its sales of weapons around the world. As we have pointed outpreviously, Germany is also a relatively large exporter in the global arms trade.
It turns out that Germany had a booming arms export business in 2015, because as Reuters reports, German arms exports almost doubled last year to their highest level since the beginning of this century. The value of individual approvals granted for exporting arms was 7.86 billion last year compared to 3.97 billion in 2014. Exports were boosted by a the approval of four tanker aircraft for Britain worth 1.1 billion, and a controversial approval of battle tanks and howitzers along with munitions to be sent to Qatar.

This post was published at Zero Hedge on Jul 3, 2016.

Black Trump Supporter Exposes Truth About “The Black Vote”

Republican presidential hopeful Donald Trump and his supporters have been accused of being ‘racist,’ which isn’t exactly an uncommon label given to Republicans by liberals.
However, one black Trump supporter recently dropped an epic truth bomb about what black voters really want out of the American dream, and if true, it should have them lining up to vote Republican in massive numbers.
Podcaster and blogger Sonnie Johnson told Breitbart that many black voters fully understand and support Trump’s message of wealth over poverty.
‘This message is very simple,’ Johnson said. ‘It is wealth over poverty. If you do not think that blacks understand that message, you have lost your entire mind.’
The outspoken conservative explained that black Americans were ‘tired of living in poverty.’

This post was published at Zero Hedge on Jul 3, 2016.

Get On The Goldwagon To $10,000

Between 1999, when gold bottomed at $250, and the 2011 peak at $1,920 there was only one major correction lasting 8 months in 2008. The ensuing correction from the 2011 top at $1,920 of almost $900 seemed to take an eternity until it finally finished in December 2015. During those four years it was always clear to me that the uptrend in the precious metals was still intact although I must admit that I did not expect a correction of that duration. But after a long life in markets, patience becomes a virtue that is absolutely essential. If your investment decisions are based on sound principles at the outset, there is no reason to change your opinion because the market takes longer to accomplish what it must do.

This post was published at GoldSwitzerland on June 29th, 2016.

Do Oil Markets Signal A Global Downturn?

Over the last few months, market watchers have become accustomed to a situation, or rather a correlation, that makes no sense. Oil and stocks have tended to move in unison. From a basic, fundamental perspective that is patently absurd. Energy costs are an important factor in the overall profitability of businesses and have a big influence on consumer behavior too, so higher oil should be a warning sign, not an indication that everything in the garden is rosy.
This week, though, we have seen signs that the correlation is now fully broken. Stocks have recovered rapidly from the Brexit news, while oil has stayed lower. The question, of course, is which is right?
The recent correlation has come about for two basic reasons. Firstly, from these levels even higher oil is still, as compared to the recent days of $100 WTI, low and therefore nothing to worry about. Secondly the potential negative effects of higher oil have been less important to stock traders than the implications of oil’s movements for global growth.
Both of those things still apply to some extent, but the further we move away from $100 oil the less relevant it becomes.

This post was published at Wolf Street by Martin Tiller ‘ July 3, 2016.

Something Huge Is Coming From Japan

Pretend, for a minute, that your country responds to the bursting of a credit bubble by borrowing unprecedented amounts of money and using it to prop up banks and construction companies. This doesn’t work, so you create record amounts of new money and push interest rates into negative territory in an attempt to devalue your currency. But this – amazingly – doesn’t work either. Your currency soars and the inflation you’d hoped to generate never materializes.
Now what? Is there even anything left to try, or is it simply time to stand back and let the current system melt down? Those are the questions facing Japan, and the answers are not obvious. Here, for instance, is its inflation rate two years into the largest major-country money creation binge since Wiemar Germany:

This post was published at DollarCollapse on JULY 3, 2016.

America’s “Soaring” Gasoline And Oil Demand Was Just An Illusion: How The EIA Fooled The Algos

When it comes to “real-time” measurements of crude demand and supply, the data is notoriously bad (and perhaps, according to some, intentionally manipulated). We pointed this out most recently in early March when we that according to IEA data, crude oil production exceeded consumption by an average of 0.9 million barrels per day in 2014 and 2.0 million bpd in 2015. Of this 1 billion barrels which the IEA said was produced but not consumer, some 420 million are said to be stored on land in OECD member countries and another 75 million can be found stored at sea or in transit by tanker somewhere from the oil fields to the refineries. This means that as of this moment, about 550 million “missing barrels” are unaccounted for “apparently produced but not consumed and not visible in the inventory statistics.”

This post was published at Zero Hedge on Jul 3, 2016.

“Uncounted!” – The True Story Of The California Primary

This documentary on the California primary is very disturbing. It has accounts from numerous poll workers of voters being told that the computer system showed specific voters as having requested to vote by mail, which meant they were supposedly mailed a ballot. Not only did many say they never got a ballot, many said they had never signed up to vote by mail. And this includes voters who said they had never heard of vote by mail.
Those voters who showed up at the polls who were listed as ‘vote by mail’ would only be given provisional ballot. On top of that, if they were registered ‘no party preference’ they would have to ask specifically for a ‘crossover ballot’ in order to vote. In fairness, I was told that many poll workers were more helpful, but this description from Greg Palast makes clear how the intent was to suppress their vote:

This post was published at Zero Hedge on Jul 3, 2016.

Deutsche Bank’s 90% Stock Collapse And The ECB’s Attempted Rescue In One Chart

Deutsche Bank, the European Union’s largest bank, has suffered a 90% stock price decline since its peak on May 11, 2007. The European Central Bank (ECB) rode to the rescue like John Wayne in a John Ford US Cavalry flick.

This chart allows you to see the attempt of the ECB to stimulate growth in the European economy and save the banks. After Deutsche Bank’s stock price peaked in May 2007, it began to nosedive. The financial crisis set it and the ECB reacted with lowering rates and performing asset purchases (like the Federal Reserve). While the ECB began to trim their asset purchases in 2013, they had to start up asset purchases again and cut the main refinancing rate once again in late 2014.

This post was published at Wall Street Examiner on July 3, 2016.

10 reasons why gold price will continue to rise

The price of gold in India has seen a highest single day jump in the last five years, with the previous one being in August 2011.
Globally, too, following the UK votes favouring exit from EU, which is an unprecedented event, has seen nearly $100 per ounce jump in gold prices, which was not a usual phenomenon. After closing at $1313 on Friday, today it is trading 1% higher in early trade around $1325 per ounce.
There are several factors that suggest gold will be a preferred asset for all kind of investors – retail, institutional or even central banks.
1. In terms of sterling, the price of gold soared nearly 20% to GBP 1,000/oz on Friday, which fell later. However, it again went up today as lower pound meant higher gold price in pound terms, a better hedge against currency for UK investors. Sterling or British pound is trading at three-decade low.
2. Bank of England and other central banks are preparing to take all actions to address fears in market, which according to the World Gold Council report released on Friday evening said, ‘Central bank action has already capped the gain in other safe haven assets.’ This means gold will shine.

This post was published at TruthinGold on June 27, 2016.

LEAKED: Japan’s Mega-Pension Fund Plows into Stocks, Eats $50Bn Loss, Tries to Hide it till after Election

Benefiting hedge funds and banks that had front-run the fund. Abenomics is facing elections on July 10 for the less powerful Upper House.
But Abenomics hasn’t fared very well. It engaged in the biggest (relative to the economy) money-printing and bond buying extravaganza the world has ever seen. The securities the Bank of Japan has bought, now at 426 trillion ($4.15 trillion), amount to 85% of GDP. About $8 trillion in Japanese Government Bonds sport negative yields. Even the 30-year yield is just about zero. The JGB market, once the second largest government bond market in the world, has frozen. The BOJ’s primary dealers are in revolt. Some have already pulled out.
Savers are scared. Sales of safes to be installed at home have soared. There have been no structural reforms to speak of. Japan Inc. has benefited enormously, through various tax benefits and special stimulus packages, including foreign aid that is channeled back to Japanese companies. Government deficits are gigantic, providing additional stimulus for Japan Inc. And yet, the economy is languishing.

This post was published at Wolf Street on July 3, 2016.

The EU Is About Control, Not Free Trade

On Tuesday, during a somewhat raucous session of the European parliament, Nigel Farage gave his post-Brexit ‘victory speech’. Besides his trademark taunting of his pro-EU colleagues, Mr Farage made an important point, suggesting:
Why don’t we be grown up, pragmatic, sensible, realistic and let’s cut between us a sensible tariff-free deal and thereafter recognise that the United Kingdom will be your friend, that we will trade with you, cooperate with you, we will be your best friends in the world.
This statement, like most of Mr Farage’s speech, was greeted with jeers. While the reaction could simply be regarded as being due to Mr Farage’s earlier taunting and to the emotional nature of the post-Brexit debate, it seems to hint at a deeper issue, which has been brought up on the Mises Wire several times: That the European Union is not primarily about free trade for mutual benefit, but about political integration and economic harmonisation, in which free trade is just the reward for going along with the political ambitions of Brussels.

This post was published at Ludwig von Mises Institute on 06/29/2016.

Gold does a moonshot, Goldman buying

As the UK voted to leave the EU, the only people celebrating more than Brexit politicians were a clutch of small brokerages that benefit when the world get’s a little more volatile: bullion dealers that offer gold coins and bars to retail investors.
From London’s Harrods department store in Knightsbridge, to online precious metals dealers, many reported record volumes and demand on Friday. Sharps Pixley, which has a store in Mayfair, said online sales had drained its stocks of larger bullion bars, leading it to call on emergency reserves in Germany.
Thea retail demand is an indication of the desire for a safe haven investment in the wake of a Brexit vote, which sent gold to a two-year high above $1,350 a troy ounce and sterling to its lowest level against the dollar in 30 years.
The UK’s Royal Mint says it has seen increased demand for precious metals, especially Sovereign and Britannia bullion coins and gold bars, since the start of the year. On Friday the number of visitors to its online platform rose 550 per cent compared with the day before.

This post was published at TruthinGold on June 27, 2016.

This Is “Worrisome”: The Probability Of A US Recession Surges To 60%, Deutsche Calculates

Ever since the US manufacturing economy entered a recession over half a year ago as a result of the collapse in capex spending in the energy sector and the soaring layoffs in shale, the strawman used by the economic apologists to “justify” that the broader economy has not followed in such recessionary footsteps, has been the frequent trotting out of the yield curve, which simply because it is still curved upward in nominal terms (if flattening recently to levels not seen since 2007), is presented as “evidence” that the US is still growing.
Just one problem: as Bank of America first explained in February, when one adjusts the curve to account for trillions in unprecedented liquidity support by the Fed which is skewing the message sent by the 2s10s (for example by looking at the 3m5s OIS adjusted curve), the curve is already inverted.

This post was published at Zero Hedge on Jul 3, 2016.

Puerto Rico Defaults On $2 Billion In Debt Payments

As expected, Puerto Rico will default on about $2 billion in debt payments Friday, including $780 million in constitutionally-backed general obligation bonds, as governor Alejandro Garcia Padilla has issued an executive order authorizing the suspension of payments. In addition, Garcia Padilla also declared states of emergency at the island’s biggest public pension – the Commonwealth’s Employee Retirement System – which is more than 99% underfunded, as well as the University of Puerto Rico and other agencies Reuters reports. The default will mark the first time a US territory has failed to pay on its general obligation bonds.
“Under these circumstances, these executive orders protect the limited resources available to the agencies listed in these orders and prevents that these can be seized by creditors, leaving Puerto Ricans without basic services,” Garcia Padilla’s administration said in a statement.
The suspension of payments comes just as the Senate rushed a bill to President Obama that was signed on Thursday, and the bill will now allow Puerto Rico to access a bankruptcy-like debt restructuring process for its roughly $70 billion in debt. As Bloomberg explains, the next phase will now be for the US appointed control board to begin the restructuring negotiation process. The step allows Garcia Padilla to use cash that would otherwise go to investors to avert cuts to schools, policing and health care that Garcia Padilla said would extract a heavy toll on the island where nearly half of the 3.5 million residents live in poverty.

This post was published at Zero Hedge on Jul 1, 2016.