http://www.caseyresearch.com/gsd/edition/jpmorgan-chase-wins-dismissal-of-silver-price-fixing-lawsuit/
¤ YESTERDAY IN GOLD & SILVER
After the news broke on Saturday morning in North America about the IMF/ECB-ordered theft of funds by the banking system in Cyprus, I knew that the New York open on Sunday night we would be something to see...and it was.
It followed the usual script when there's bad financial/monetary news over the weekend...a blast off in price...and then a crushing sell-off. As Dennis Gartman said..."gold was being offered in size." The same happened at the London open and the New York open...as the rallies got capped almost before they could get started. The rally got killed off for good once the London p.m. gold 'fix' was in...and that, as they say, was that.
Gold finished the Monday trading session at $1,605.80 spot...up $12.90 on the day...but would have been up ten times that amount [and probably more] if JPMorgan...and probably the BIS this time...hadn't intervened. Net volume was pretty decent...around 146,000 contracts...and a large chunk of that took place before London opened, as "da boyz" threw everything they had at the gold price.
It was the same in silver, of course. The high tick was probably well north of $29.20 shortly after the market opened in New York on Sunday evening...and I duly noted the spike low [around $28.50 spot] at precisely 3:00 p.m. in Hong Kong. After that the silver price followed the same path as the gold price.
Silver closed at $28.90 spot...up a whole 13 cents from Friday's close...and safely back under the $29 spot price mark. Volume was not overly heavy...about 38,000 contracts, give or take.
JPMorgan et al didn't leave anything to chance on the bad news out of Cyprus...as they hammered platinum, palladium and copper prices as well. I'm sure the call went out to hit anything of real value, so down they went.
Here's the palladium chart. These guys are truly pathetic. It's actually worse than that. They're sociopaths.
Dr. Copper got smacked pretty good...over a dime. Ted Butler told me that this a huge daily move for copper...and volume was monstrous. Copper is the other metal that shows up on the Commitment of Traders Report every Friday...and I'll be interested to see what those numbers look like. The Commercials are actually net long the metal. Here's the 6-month copper chart.
The dollar index should come as no surprise, as there was no one there to cap the rise in it...but considering the news, it certainly didn't perform as I figured it might. It closed on Friday at 82.22...and then blasted off the moment that the markets opened in New York on Sunday night. The index broke above the 82.80 level less than two hours later...and that's as high as it got. Then at 2:00 a.m. Hong Kong time, it began to roll over...and by 10:00 a.m. in London, had given up over half its original gain. From that point, the dollar index chopped sideways in a pretty wide range, closing the trading day on Monday at 82.66...up 44 basis points.
It's almost pointless to mention that, once again, there was zero correlation between the dollar index and the gold price...but point it out I must.
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The CME's Daily Delivery Report showed that 601 gold and 3 silver contracts were posted for delivery within the Comex-approved depositories tomorrow. In gold, it was all JPMorgan Chase as short/issuer with 346 contracts in their in-house [proprietary] account...and the other 255 were from their client account. The only two long/stoppers were Canada's Bank of Nova Scotia with 328 contracts...and Barclays with 273 contracts. The link to yesterday's Issuers and Stoppers Report is here.
There was another big drop in GLD yesterday. This time it was a chunky 435,396 troy ounces. And, once again, there were no reported changes in SLV.
There were no gold sales of any type reported by the U.S. Mint yesterday...but they made up for it by selling another 638,000 silver eagles. Month-to-date sales in silver eagles now sit at 2,349,500. I must agree with Ted Butler that a very large chunk of these silver eagles are headed outside the United States.
Over at the Comex-approved depositories on Friday, they reported receiving 386,907 troy ounces of silver...and they shipped 352,308 troy ounces out the door. The link to that activity ishere.
Here are a couple of charts that Nick Laird sent me early yesterday morning...and I thought they were worth posting. Nick's included comments read as follows..."Having recently bottomed, I think these are good to go again." Yes, they certainly do look good, but they're both painted by JPMorgan Chaseet al...and it will be interesting to see what happens, or is allowed to happen, now that this issue with Cyprus is on the table.
(Click on image to enlarge)
(Click on image to enlarge)
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Selected news and views - non Cyprus items......
Moody’s Sees Defaults as PBOC Warns on Local Risks
Moody’s Investor Services said China’s local government financing vehicles face greater risk of default, as regulators warn 20 percent of their loans are risky.
A rally in LGFV bonds may reverse, particularly should delinquencies emerge, Christine Kuo, a Moody’s analyst, wrote in an e-mailed response to questions on March 8. The average yield may rise to 7 percent by June from 6 percent now, according to Shenyin & Wanguo Securities Co., the first brokerage incorporated in China and ranked the nation’s most influential research provider by New Fortune magazine in 2010.
“I see increased risk of LGFV defaults because the financial profiles of many remain weak and heavy refinancing is needed,” Hong Kong-based Kuo said. “Regulators have asked banks to control their LGFV exposures. Some of the projects could default unless other sources of funds are found.”
This Bloomberg news item, filed from Singapore, was posted on their website late on Sunday evening Mountain time...and it's courtesy of Manitoba reader Ulrike Marx.
Seven King World News Blogs/Audio Interviews
1. James Turk: "Money is no Longer Safe in Banks After Cyprus Theft". 2.Jim Sinclair: "All Hell is Breaking Loose After Cyprus Catastrophe". 3. Jim Sinclair again..."One of the Most Important Events in History and Gold". 4.Eric Sprott: "Jim Sinclair, $11,000 Gold and Skyrocketing Silver". 5. Jim Sinclair for the third time..."Cyprus Disaster is Much Bigger Than Being Reported". The first audio interview is with Dr. Paul Craig Roberts...and the second audio interview is with Eric Sprott.
Egon von Greyerz: Get Your Assets Out of the Banks - NOW
The Cyprus event may later, in the history books, be seen as the catalyst of the fall of a century long Ponzi scheme. This could rank in line with the shot in Sarajevo as the start of WW1 or the collapse of Kreditanstalt in 1931 as the start of the Great Depression.
Isn’t it ironic that exactly 100 years after the creation of the Fed (a private bank created for the benefit of bankers) that the fragile and bankrupt financial system is likely to fall due to the insolvency of a couple of Cypriot banks.
But what is happening in Cyprus will not be the reason for a collapse but just the trigger for what has always been inevitable.
This commentary by Egon was posted on the goldswitzerland.com Internet site yesterday...and it's worth your time.
JPMorgan Chase wins dismissal of silver price-fixing lawsuit
JPMorgan Chase & Co. has won the dismissal of a nationwide investors' lawsuit accusing the largest U.S. bank of conspiring to drive down silver prices.
U.S. District Judge Robert Patterson in Manhattan said the investors, who bought and sold COMEX silver futures and options contracts, failed to show that JPMorgan manipulated prices at their expense, including by amassing huge short positions that were not justified by market events at the time.
In a decision made public on Monday, Patterson said that while the investors showed that JPMorgan had the ability to influence prices, a fact the bank did not dispute, they failed to show that the bank "intended to cause artificial prices to exist" and acted accordingly.
I knew just about right from the outset that this case had no chance...and said so. How can one successfully bring a case against JPMorgan for price fixing in the silver market when the world's #1 silver expert isn't even asked to supply evidence or testify? The case was so poorly handled on a legal basis, that it almost seemed like it was designed to fail from the beginning...a fact that I pointed to anyone who would listen...Ted Butler included. I'm sure he'll have something to say about it in his mid-week column tomorrow...and it's a pretty good bet that whatever it is will be posted in the public domain soon after.
I extracted this Reuters story from a GATA release early yesterday evening...and it's a must read as well.
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¤ THE WRAP
The issue which has swept down the centuries...and which will have to be fought sooner or later...is the people versus the banks. - Lord Acton
It was obvious that "da boyz" were at battle stations the moment New York opened on Sunday night. While they managed to get silver back under the $29 price mark...gold is still a few dollars above the $1,600 price level...and it remains to be seen how long that lasts.
I would guess that JPMorgan et al were going short against all comers all day long yesterday...and it would also be my guess that the raptors [the Commercial traders other than the Big 8] were selling long positions at a profit. It pretty much goes without saying that there will be a huge jump in the Commercial net short position in both gold and silver when the Commitment of Traders Report comes out on Friday.
However, having said that, I quick peek at the preliminary open interest numbers on the CME's website in the wee hours of this morning showed virtually no change in open interest in either metal...so I'm not sure what to read into that...and I doubt very much whether the final numbers that come out later this morning Eastern time will shed much light, either. The COT Report on Friday will tell all...and the cut-off is at the 1:30 p.m. close of Comex trading in New York later today.
For the next couple of days we have the FOMC meeting...and I'm sure the participants didn't want a run-away gold price in progress while sipping their drinks. I doubt very much whether they'll have anything to say at the end of it all, especially in light of current instabilities in Europe's financial system at the moment.
As I said on Saturday, they world's economic, financial and monetary systems are hanging by a thread...and without massive interventions everywhere, I'd bet serious money that everything would have begun to implode yesterday. All "da boyz" are doing is delaying the inevitable.
And as David Franklin's said in his comments in the 'Critical Reads' section...the Cyprus debacle was aRubicon Moment for what currently passes as the world's financial and monetary system.
In Far East and early London trading, you'd never know that Europe had a near-death experience yesterday, as volumes are light, the dollar index is flat...and price are not doing much. However, I don't expect that situation to last...but if yesterday's rally attempt is any indication, it certainly appears that JPMorgan et al are going to be going back on the short side of this market the moment that happens.
I look forward to this morning's trading action in New York with great interest.
See you tomorrow.
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