re: Big Banks playing dirty in the metals market

JPM doesn't speculate. They hedge. Most likely with the silver they are custodian for on behalf of SLV. There is some proof to this. They can now hedge, but not speculate. Do some research, draw your own conclusions. At some point it must end. When? That is the multi zillion dollar question.

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For pure speculation, look at JPM and the silver market.

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If you have evidence of that you need to report it to your nearest US Attorney's office.

Dodd-Frank made it illegal for any US bank to purchase any commodity or derivative for speculation purposes. They can only hedge customers positions now.

The portion of the bill that addresses derivatives, and specifically swaps, is fairly complex.

I would maintain that anyone trading contracts, options, ETF and ETN's that engage in this, and other similar products, should have at least some knowledge about this, or they are a loser before they place the trade more often than not.

The problem with the bill, well one of the problems, is where the enforcement lies. So for example, in the case of JPM there are several governmental agencies that enforce various provisions. CFTC physically comes in and looks at depositories/ warehouses, and checks for ownership of the actual commodity. The issue with JPM has always been, when they come in, JPM is listed on a lot of silver, but there is no way to know if they are custodian and/or owner. See SLV. JPM can "hedge", and they do, This hedging with custodial silver is also speculation, because JPM also owns silver. No way to enforce this. None.

Everyone knows this, even CFTC. CTFC had a multi- year investigation in to this, no conclusion. It's just too complicated to prove intent.

Interesting though on a US Attorney. Depending on what office they might be seeking in the future, they might run with this issue. Nothing will ever happen to conclude it however.

It will come to a head eventually. Likely on silver due to actual demand. Probably never on gold unless we really melt down. All large players in gold have a vested interest in keeping things the way they are. Also probably never on aluminum as both the mfg's and banks have a vested interest in keeping things the way they are.

The problem I have with investing, and I recognize it, is that I need to make a concerted effort to think like the entity on the other side of the deal is thinking. When I do this well, I'm at about 65% winning trades.

The Bear position that JPM inherited is an interesting study in and of itself. My understanding, and I haven't checked the COT reports in a while, is that they've only recently started to truly unwind these. They've claimed to be unwinding these all along, but COT reports show this isn't true.

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The Bear position that JPM inherited is an interesting study in and of itself. My understanding, and I haven't checked the COT reports in a while, is that they've only recently started to truly unwind these.


Agreed on it being interesting.

I also find it interesting that JPM is taking possession of a lot of physical silver.

LINK

Hedging paper shorts by buying physical possibly? Then driving up the physical value when they close paper shorts?

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We should talk about this in the silver thread. I neglected to mention bank participation report in addition to COT. I'm a silver bull, and I take possession. I also trade the paper. I'm interested in your thoughts on this. I do think it is clear they will continue to drive the fix, spot and futures markets.

Also interesting are the redemption from SLV. And who can actually redeem in which particular basket size.

Ted Butler gets a bit too rah rah for me. I pay particularly close attention to Eric Sprott. Mostly because he is a lender, and he puts his money where his mouth is. Butler does also, but Sprott is more like a royalty player, who also stacks. Also, Sprott runs a business, a large one, and I usually relate better to that. He has to react to bad silver markets more so than Butler.