Precious Metal Market Manipulation Continuation?

Gold Manipulation Silver Manipulation Merrill Lynch JP Morgan Citigroup

The total of ongoing crimes against precious metal investors continues to unjustly rack up, and get further ignored at the highest levels according to verifiable offshore central bank precious metal price manipulation publicly available documents.

Every few months now seemingly, another major commercial bank involved in the spoofing and alleged rigging of precious metal spots prices get slapped on the hand for doing so.

Ongoing is a significant investigation of JP Morgan’s role in precious metal trading crimes with the potentiality of there being systemwide managerial knowledge and encouragement of such egregious market crimes.

Just this week the US Justice Department entered into a corporate resolution with Merrill Lynch Commodities Inc. to pay $25 million in fiat US dollars, to resolve the government’s investigation into a multi-year scheme by MLCI precious metals traders to mislead the market for precious metals futures contracts traded on the Commodity Exchange Inc. (COMEX - What is it?).

Of course, there was no disclosure as to the estimated amounts of profits made over the years for such precious metal market price misleadings. Nor will any individual involved likely face criminal prosecution nor prison time. So the lesson continues to be rig markets for profits and bonuses seemingly. Pay paltry fines perhaps years later, face no further penalties other than name brand devaluations perhaps.

Merrill Lynch fined for Precious Metal Market Manipulations

This month June 2019, the US Office of the Comptroller of the Currency published the fact (see table 9) that only two current commercial banks (of the over 5,300 US Federally-insured chartered commercial banks) recently held some 75% of all precious metals derivative contracts by all Federally-insured banks and savings associations in the U.S.

Precious Metal Market Manipulations Growing in Size and Scope

Of the reported $38.57 billion in fiat US dollar values held in precious metals derivative contracts by all US Federally-insured banks and savings associations, JPMorgan Chase Bank held $17.509 billion, and Citibank held $11.691 billion of the total.

This OCC report completely ignores that fact that the Federal Deposit Insurance Corporation (FDIC) is woefully underinsuring current fiat US dollar bank deposits which are also under supra-national law to be potentially bailed-in not bailed out if we undergo another significant financial crisis ahead.

During the 2008 financial crisis, precious metals derivative contracts at US Federally-insured chartered commercial banks were less than $15 billion in total. They have more than doubled since that time. We wonder, have gold and silver mining operations nearly also triple their total market operations in scope and values over this same timeframe?

If anything, the precious metal mining industry has only further consolidated from the last major global financial crisis as precious metal mining share values are near record low levels and have been so for many years running.

So what is going on in the precious metal price discovery markets to have relatively recently required so much growth in precious metal derivative contracts outstanding?



For a further reporting on what this latest OCC report on precious metal and other derivative trading activities of a small handful of the more than 5,300 Federally-insured banks, we suggest reading Pam Martens’ most recent critique of continued financialization of the US and global economies post-repeal of the 1999 Glass-Steagall Act.

Last time western financial powers attempted to suppress the global prices of gold, silver, and other precious metals (London Gold Pool collapse 1968), the world ultimately underwent an era with a rapid multiplication of precious metal values peaking by early 1980.

Our ongoing expectation is the world will again rebid precious metals from many current decades running undervaluations to fair value, to possibly overvaluations in time. Understanding when it may be best to sell some bullion for reinvesting into other asset classes is crucial to successful bullion ownership long term.

It is also one reason why all investors everywhere should strongly consider acquiring and continually maintaining a prudent gold investment allocation, especially when living under full fiat currency monetary regimes as we have currently. Backtested financial data proves this assertion as being continually sound for investors.

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