Wednesday, October 30, 2013

Gold and Silver news and views - October 30 , 2013 - Gata items including Andrew McQuire's response to the Jeff Christian attack on his credentials ....CitiGroup and JP Morgan put senior currency dealers on leave , no silver or gold dealers put on leave......Did Jeff Christian inadvertently disclose manipulation of silver ( would also apply to gold ) - Bix Weir says " YES " and writes to the useless CFTC to wake up and address HFT and computer algo programs manipulations .... and just look at the deathly silence at CME for gold - is there any physical gold left and not just paper there ?

Gata......



Citigroup, JPMorgan said to put senior currency dealers on leave

Submitted by cpowell on Wed, 2013-10-30 23:20. Section: 
By Gavin Finch, Liam Vaughan, and Ambereen Choudhury
Bloomberg News
Thursday, October 31, 2013
Citigroup Inc. and JPMorgan Chase & Co. are putting their top London currency dealers on leave after regulators probing the manipulation of foreign-exchange rates started investigating the traders’ use of an instant-message group, three people with knowledge of the moves said.
Rohan Ramchandani, Citigroup's head of European spot trading, was told today he will be placed on leave, said one of the people who asked not to be identified because he wasn't authorized to talk publicly. Richard Usher, JPMorgan's chief dealer in London, went on leave two weeks ago, said another person. Both are taking leave by mutual agreement with their employers and neither has been suspended, the people said.
Standard Chartered Plc has also placed Matt Gardiner, its assistant chief dealer in the U.K. capital, on leave, a fourth person said yesterday. None of the traders has been accused of any wrongdoing.
Regulators are focusing on an instant-message group the traders set up to share information about their positions and client orders over a period of at least three years, four people with knowledge of the probe said this month. The roster of banks in the group changed as the men moved firms and also included Barclays Plc, Royal Bank of Scotland Group Plc, and UBS AG, three people with knowledge of the communications said.
Investigators are weighing whether the messages amounted to attempts to manipulate the market, two people said. The five firms account for about 47 percent of the $5.3 trillion-a-day foreign-exchange market, according to a May survey by Euromoney Institutional Investor Plc. Two other traders, who weren't part of the conversations and who asked to not be identified because they do business with those involved, said that they and others in the market referred to the message group as "The Cartel."
Ramchandani referred calls to Citigroup's press office, while Usher didn't respond to e-mails and a message left on his work telephone. Gardiner, who previously worked at Barclays and UBS and moved to London-based Standard Chartered in September, didn’t respond to a message left on his mobile telephone. Sarah Small, Jenna Ward and Aurelie Leonard, spokeswomen for RBS, UBS and Barclays declined to comment. Jennifer Zuccarelli, a JPMorgan spokeswoman, and Jeffrey French, a Citigroup spokesman, said they couldn’t comment.
RBS, Usher's employer before he joined JPMorgan in 2010, handed over his communications to regulators after concluding that he shared too much information about his positions with counterparts at other firms, two people said.
Usher and Ramchandani were members of the Bank of England's 27-member London Foreign Exchange Joint Standing Committee's subgroup of chief dealers as of December, according to the central bank’s bulletin for the second quarter. The group met three times last year to discuss matters including regulatory developments and market conditions, according to the bulletin. A Bank of England spokeswoman declined to comment.
Regulators in London and Zurich are probing the foreign-exchange market after Bloomberg News reported in June that dealers in the industry said they had been front-running client orders and attempting to rig the benchmark WM/Reuters rates by colluding with counterparts and pushing through trades before and during the 60-second windows when the benchmarks are set.
The data are collected and distributed by World Markets Co., a unit of Boston-based State Street Corp. and Thomson Reuters Corp. Bloomberg LP, the parent company of Bloomberg News, competes with Thomson Reuters in providing news and information as well as currency-trading systems.
The rates determine what many pension funds pay for their foreign exchange and are used by index providers such as FTSE Group to calculate indexes spanning multiple currencies. Index tracker funds, which buy and sell currencies at the 4 p.m. WM/Reuters rates, typically place their orders in the hour or so before the close, giving dealers a picture of their complete order book in advance of the so-called fix.
Because banks agree with clients to trade at the WM/Reuters rates, regardless of later moves, dealers are at risk of losses if the market moves against them.
Barclays and Frankfurt-based Deutsche Bank AG have said they're cooperating with regulators probing the foreign-exchange market, while Switzerland's UBS said yesterday it's taking measures against employees. The Zurich-based firm didn’t identify or quantify the number of employees involved, or say what actions it took.
The U.S. Justice Department opened a criminal investigation of possible manipulation of the foreign-exchange market, a person familiar with the matter said on Oct. 11.


TF Metals Report: JPM will take December delivery, so gold is about to rally

Submitted by cpowell on Wed, 2013-10-30 14:30. Section: 
1:23a AEST Thursday, October 31, 2013
Dear Friend of GATA and Gold:
The TF Metals Report's Turd Ferguson says the latest gold futures market report from the U.S. Commodity Futures Trading Commission shows the major U.S. banks strongly long going into the December delivery month, with most of the bank long position likely held by JPMorganChase.
Ferguson writes: "As we've clearly established over the past few months, price is raided only during delivery months where JPM is issuing deliveries. In August, when JPM was taking delivery (stopping), price rallied. Since JPM is clearly not going to be issuing in December, should we expect a rally? Absolutely! This is why I've been telling you for weeks that price would bottom again in mid-October and then rally through the end of the year. This latest bank participation report, though dated and stale, nonetheless confirms this forecast."
Ferguson's analysis is posted at the TF Metals Report here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


Andrew Maguire: Christian attacked me to defend the paper gold system

Submitted by cpowell on Tue, 2013-10-29 23:41. Section: 
By Andrew Maguire
Tuesday, October 29, 2013
Last week an attack was made on me based on misinformation. The most important question to ask about it is: Why?
This is easy to answer. I am exposing the imminent default of the London Bullion Market Association's unallocated bullion banking system. Ever since Jeffrey Christian of CPM Group made the mistake of admitting that 100-1 leverage was routinely employed by the LBMA bullion banks --
-- it would appear that his credibility with his industry peers was brought into question by his exposing the default vulnerability of the LMBA's unallocated bullion banking system.
My work publicizing this has put Christian on the defensive and has caused him to disparage my successful trading career.
It mystifies me as to why my 35 years of trading and banking history are of such importance when I am recognized by my peers as an international and respected trade and investment adviser providing more than 20 years of service to institutions and accredited investors.
I am recognized as a metal trading specialist and a U.S. Commodity Futures Trading Commission "whistleblower" and I want to make the following information clear.
I have never said I worked for Goldman Sachs. The commodity trading firm J. Aron, for which I briefly worked, was taken over by Goldman Sachs and I suspect that this is how people have wrongly concluded that I worked at Goldman Sachs. With regard to my tenure at J. Aron, this was a very short-term junior position 41 years ago, coinciding with my first emigration to Canada, and I do not attribute any of my trading experience or skill set to the firm.
My full-time institutional banking career started in Canada in 1972 at Associates Capital International, a division of Gulf and Western, prior to its acquisition by Citigroup, where I fulfilled numerous senior management roles in both Canada and later in the UK, specializing in derivatives trading. I left ACI in 1982 to become an independent trader specializing in the precious metals markets while pursuing several other business opportunities.
False information was recently distributed that one of my companies, Custom Lease Capital, had failed and had been my sole business interest. I received an entrepreneur award in 1992 for excellence with this company and it was sold in good legal standing:
Alongside my experience as an independent trader, I have had directorships in several highly successful companies, including VSE-listed Guilderand Mining in 1992:
Recent misinformation relating to a 1998 trading account's supposedly having "dismal performance" actually relates to a former wife's retail equity trading account, which indeed underperformed and was closed by me. It is not a prerequisite to have worked at Goldman Sachs of JPMorganChase to be an accredited trader. Many successful traders have worked for these companies. But I do have very good contacts at both of these banks.
Not being given the opportunity to rebut misinformation before it is published creates unnecessary confusion. Despite claims to the contrary, I was never directly given the opportunity to rebut the recent charges before they were published.
In summary, attempts to discredit my work by focusing on my credentials 40 years ago, using unreliable sources, confirm that I am exposing the risk of a potential LBMA default. This information obviously strikes fear in those who try to discredit me, or else why would I matter?
These attacks tell me I am succeeding and I am very encouraged to continue the pursuit of the truth exposing a very opaque and protected cabal of banks that increasingly are being caught manipulating world markets.
In providing this response, it is not my intention to perpetuate a distracting exercise and so I do not plan to make further comments on this matter.




Attacks on Maguire aim to defend 'paper charade' in gold market, Kaye says

Submitted by cpowell on Tue, 2013-10-29 05:36. Section: 
4:35p AEST Tuesday, October 29, 2013
Dear Friend of GATA and Gold:
Attacks on monetary metals market rigging whistleblower Andrew Maguire are meant to defend the "paper charade" that is the London "physical" gold market, whose massive leverage Maguire has been exposing, Hong Kong fund manager William Kaye says in an interview with King World News. It's excerpted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


Silver Doctors....




http://www.silverdoctors.com/jeffrey-christian-slips-up-again-inadvertently-proves-illegal-comex-price-setting-in-silver/#more-34009



Submitted by Bix Weir, Road to Roota:
OPEN LETTER TO THE CFTC
October 29, 2013
Commodities Futures Trading Commission
3 Lafayette Center
1155 21st St. NW Washington, DC 50581
Re: Illegal COMEX Price Setting
ATTN: CFTC Commissioners:
In a stunning admission last week at The Silver Summit in Spokane, Washington, CPM Group’s President Jeffrey Christian, a long time opponent of silver market rigging claims, admitted that the price of silver was being illegally set on the COMEX trading floor. This admission came during his attempt to prove that there was no silver market manipulation taking place.
Christian’s assertion was that the wild swings in the price of silver were not being caused by rogue market riggers but by multiple computer algorithms and High Frequency Trading programs firing at the same time in the COMEX silver exchange based on the same program triggers. Christian claims that the simultaneous nature of these trades spring from all trading houses using the same algorithms they learned in the same colleges. Trading volumes on the COMEX supports this assertion as the COMEX is on track to trade over 80 B equivalent ounces of silver derivatives in 2013 which is 1,800 x the amount of Registered Physical Silver in the COMEX inventories(44M oz).
Unfortunately for Christian and the CME, what he describes is an artificial price setting mechanism for silver in an exchange that is specifically regulated such that it does not “set” silver prices but rather is a “price discovery” exchange. What Christian describes is ILLEGAL and the CME Group who owns the COMEX should immediately shut down all HFT’s and computer trading programs stopping this continued distortion of silver prices.
Regulating the futures and options markets such that they DO NOT set an artificial price of a commodity is specifically why the CFTC hires Economists to oversee the Silver derivative markets(futures and options are derivatives). Weighing the stable supply/demand dynamics of the silver industry(0-5% annual volatility range) against the volatile COMEX trading activity and price fluctuations(over 100% annual volatility swings) is the proof that the price of silver is being artificially determined by derivatives as Christian suggests.
The legal concept is fairly simple, the trading of futures and options should not be the overriding price influence in setting the price of any commodity as it does not reflect the true supply/demand dynamics of the underlying commodity being traded.
Jeffrey Christian is the leading authority on commodity derivatives with experience in advising the largest players in the paper/electronic silver space such as the IMF, World Gold Council, Central Banks, Bullion Banks and Global Mining Companies. Before CPM Group spun off from Goldman Sachs in the 1980′s, Christian worked with Robert Rubin who advocated and developed Gold Leasing Programs for Central Banks and National Treasuries(although Germany is still trying to unwind their leased gold). In the 1990′s Christian advised companies on how to properly hedge their gold production(although massive Billion dollar write downs were taken as the price of gold rose in the 2000′s). Christian is currently leading the charge to restart miner hedging programs as he advocates hedging once again to offset the price volatility on the COMEX…
WAIT! This silver price volatility is caused, according to Christian, by multiple computer algorithms and High Frequency Trading programs firing at the same time and is NOT a freely traded price of silver!
eagles
Any hedging on false COMEX price discovery is an accident waiting to happen…AGAIN!
It is imperative that the CFTC investigate and stop such illegal price influencing actions on the COMEX as it is destroying the true price discovery mechanism for silver. Companies and individuals are making bad decisions based on faulty price data originating out of the COMEX.
Silver investors should demand an explanation from the CFTC and the CME as to Jeffrey Christian’s claim that price fluctuations in silver are being initiated and caused by computer driven trading that artificially influences the “Fair Market Value” of silver.
I want to thank Jeffrey Christian for bringing this to the attention of all who attended the Silver Summit as it explains WHY the price of silver is so volatile in an underlying industry that should, by all accounts present at the Summit, be stable and predictable.
Sincerely,











CME showing a dearth of activity.......































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