Silver Market Manipulation
Silver market manipulation, especially in terms of the illegal downward manipulation of the spot price of silver, has been at the order of the day for a long time. It’s clear that the manipulators, which are mainly bankers and their allies in governments, do not want people to realise what the true value of silver is. They intend to keep the spot price of silver as low as possible otherwise the “paper gimmick” won’t work. The moment the majority of people realise that gold and silver are money they will dump fiat currency, non-redeemable paper notes or electronic digits for gold and silver in their droves.
Bankers and their allies in government…
Bankers and their allies in government have started 50 years plus ago with the manipulation of the gold and silver markets as far as modern history is of a concern. Too keep things simple, we will focus on the manipulation of only the silver market here and without going into much of the detail. Silver market manipulation commenced even before the deployment of the “paper gimmick,” because the bankers and their allies had to convince people that gold and silver are not really valuable in order to get them to accept non-redeemable paper notes or electronic digits as money. In no specific order, for some time the spot price of silver was fixed at a level below it’s true worth, the gold and silver standards (“standard economic unit of account is a fixed weight of gold/silver” – Wikipedia) were abolished, new coins with no silver content were issued, they made it a crime to melt-down any legal tender coins (e.g. silver coins), entire government stockpiles of silver as well as silver from the stockpiles of bankers were dumped onto the market and “paper silver” was introduced, all in a bid to suppress the spot price of silver or to manipulate the silver market.
Silver fixed at $1.29 per fine ounce and other measures to manipulate the silver market
The U.S. government pinned/fixed the price of silver at $1.29 per fine ounce in the 1960’s. This undervalued silver to a large extent, and savvy investors who had noticed this, started to accumulate silver at that price level. They knew that it was just a matter of time before the price of silver would shot up sharply as a result of government interference in the market. The U.S. and other governments then started to dump their stockpiles of silver onto the market in order to maintain the artificially low silver price. In a bid to defuse a “silver supply crisis” the bankers and their allies in government tried their best to prop up the U.S. Dollar while on the gold standard. They were hoping that the bulk of investors would lose their interest in silver if they could for one continue to pin the price of silver at $1.29 per fine ounce and continue to prop up the U.S. Dollar. It however didn’t work out exactly as planned since government stockpiles of silver got depleted and the bankers had no choice but to give up on propping up the U.S. Dollar. They were starting to lose the battle against an increasing number of investors that wanted to acquire silver at under-valued price levels. Once this happened, it led to a rapid increase in the price of silver to the extent where the silver content, especially of small denomination silver coins, exceeded the face value of the relevant coins. This encouraged people to buy the relevant coins at face value and profit by selling them for their metal or silver content which led to many silver coins being melted down.
A second round of silver market manipulation
Like with all illegitimate schemes, the bankers and their allies in government had to kick start a second round of silver market manipulation in order to remedy the undesired outcome of their initial actions, which was a rapid increase in the price of silver despite their initial success at keeping the price of silver pinned at $1.29 per fine ounce. The price of silver would not have increased so rapidly if it was not for their illegitimate schemes targeting the silver market.
The bankers and their allies in government kick started a second round of silver market manipulation by issuing new coins with no silver content, making it a crime to melt down legal tender coins (e.g. silver coins) and abolishing the gold standard (and silver standard in other parts of the world). They had in effect cleared the way for the “paper gimmick” to be deployed. Ridiculous as it may be, it became a “crime” for ordinary citizens to make a profit on their own money while bankers were allowed to debase money at an accelerated phase. This is despite the fact that the U.S. Constitution for one strictly forbids the use of anything but gold and silver as legal tender. The first paragraph of Section 10 of the relevant constitution reads: “No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.”
Furthermore, the U.S. Coinage Act of 1792 provided for a U.S. Mint to mint or stamp gold and silver coins consistent with or as dictated by the U.S. Constitution. This all important Act made two things very clear: Firstly, the death penalty should be given to anyone found to be debasing money, and secondly, one U.S. Dollar was defined by statute as a specific weight of gold.
In other words, the bankers and their allies in government had brought in a monetary system which is nothing short of an act of high treason against the people of the United States, especially if one considers that the U.S. Constitution makes it clear that only gold and silver must be used as legal tender and the fact that the U.S. Coinage Act of 1792 invoked the death penalty for anyone found to be debasing money.
Didn’t they make it a crime to melt down legal tender coins with the primary aim to protect legal tender coins against destruction?
It may seem as a perfectly fine measure by government to make it illegal to melt down legal tender coins in a bid to protect these coins against destruction. In fact, it will not surprise us if this was the very reason given by them and that most people fell for this trickery. It’s however not that simple…
The truth is that silver had been used in history as money and legal tender in many forms or shapes. In fact, history has proven that the form or shape of silver is not of vital importance when it is used as money or legal tender. This is not to say that some forms of silver (e.g. silver coins) are not more convenient to use as money or legal tender as other forms of silver (e.g. silver bars). It’s rather to say that one should not see the melting down of a legal tender coin (e.g. silver coin) as the destruction of money or legal tender per se. It’s not ideal to melt down legal tender coins, but if it’s necessary to realize the purchasing value of one’s money, especially after bankers and their allies have diluted it at some stage through the illegal manipulation of the silver market, then it should be perfectly fine to do so. The debasement of silver coins by replacing it with new coins with no silver content and the abolishment of the gold and silver standards are far worse crimes than melting down legal tender coins, especially in the form of gold and silver coins. The truth is that the bankers and their allies in government didn’t and don’t really care about the destruction of legal tender (e.g. silver coins); they had and have been more interested to hide the true value of silver from being expressed in their diluted paper or non-redeemable paper notes. If they didn’t manipulate the silver market, the purchasing value of silver coins used as legal tender wouldn’t fluctuate to such a great extent.
In other words, to declare the melting down of legal tender coins (e.g. silver coins) a crime, especially given the background of rampant silver market manipulation, then it’s clearly not about the protection of legal tender per se, but rather about the creation of an environment where it’s much easier to replace real money, which is gold and silver, with non-redeemable paper notes and coins containing metal of little or no intrinsic value. It’s after all no secret that the “paper gimmick” can only work if the majority of people are duped into believing that real money such as gold and silver, especially silver, has no or little intrinsic value.
Is it still a crime today to melt down legal tender coins?
Yes, it’s a crime in most countries to melt down legal tender coins.
The oldest swindle in the book…
It went from bad to worse when the bankers and their allies in government were allowed to fall back upon the oldest swindle in the book: They started to sell paper to people and pretended that the paper represented actual silver.
By doing this, they switched from a relatively acceptable form of market manipulation, which is the dumping of physical silver unto the market, to a form of market manipulation which is totally unacceptable. In fact, the creation and selling of paper silver is also a form of dumping as far as the effect on the spot price of silver is of a concern, but with the huge difference that it can be created out of thin air. Paper silver is not silver, must not be counted as silver or seen as representative of silver by any stretch of the imagination. It’s nothing short of outright thievery and trickery. It is the same thieving bastards that want you to believe that the “Federal Reserve” is a government institution and that valuable monetary assets are kept in “reserve.” In reality the “Federal Reserve” is a private institution and the bulk of what they keep in “reserve” consists of non-redeemable paper notes which must reach its intrinsic value of zero at some stage or another, especially if one considers the alarming rate at which they are diluting/debasing/over-issuing money.
What is “paper silver” exactly?
Financial instruments such as silver futures, silver forwards, silver options, silver swaps, silver exchange-traded funds, silver accounts (mostly hold futures and not physical silver), etc., which are not made up of physical silver, are referred to as “paper silver.” These are all instruments investors can use to gain exposure to an illegally manipulated silver market, but the only way to own silver is by acquiring or buying physical silver, especially in the form of silver coins and silver bullion bars (silver bars). Needless to say, silver derivatives or paper silver dilute the demand for silver which helps to a great extent to depress silver prices, especially the spot price of silver.
In other words, paper silver consists of financial instruments (e.g. silver futures, silver forwards, silver options, etc.) that investors can use to gain exposure to and use to manipulate the silver market.
Why do you refer to paper silver or the trading thereof as “thievery and trickery”?
The problem with paper silver is that most people believe it represents actual or physical silver and it doesn’t (except of course for a few silver accounts which hold physical silver – although most of those cannot be trusted to actually hold enough physical silver to cover the paper claims). It is pretty much the same as the “paper gimmick” where they have people convinced that fiat currency or non-redeemable paper notes are money.
In fact, a conservative estimate indicates that for every 100 ounces of paper silver held there is only 1 ounce of actual or physical silver available (at the time this was written). In fact, it’s clear that paper silver, like all fiat currencies, leave the door wide open for abuse and is in fact nothing short of legalized thievery, since the price of physical silver can easily be suppressed through the issuing of paper silver which doesn’t give a truthful picture of silver’s fundamentals. This while in reality there’s an increasing and high demand for physical silver, especially industrial demand, and a supply of physical silver that struggles at best to keep up with the demand. This should be reflected in the spot price of silver, but at $18 per fine ounce one can hardly say that silver’s true value of round about $85 per fine ounce is reflected (at the time this was written). Needless to say, investor demand for silver has been relatively flat or non-existent, mainly due to illegal silver market manipulation which gives the bulk of investors the idea that silver is not important due to a relatively flat or low price! It’s after all no secret that in a free market not characterized by any manipulation, especially outright illegal manipulation, the value of a commodity is normally reflected in the spot price of the commodity.
Now it must be clear that by issuing paper silver, especially silver derivatives, with no or little relation to the quantity of actual or physical silver available, one can easily suppress the spot price of silver while the majority of people and investors fall for this gimmick or sham. This is what bankers have been doing since 2006 as far as modern history is of a concern. However, it’s not expected to last for much longer since firstly, paper silver cannot be used in industrial applications, secondly, the time of the “paper gimmick” where fiat currencies are of a concern is almost up and this will most definitely affect paper silver, and thirdly, this time around there are no if any substantial stockpiles of silver to dump unto the market to suppress the spot price of silver. Don’t be surprised if industry players, especially those dependent on silver to stay in business, push the spot price of silver to new record levels as the actual supply of silver drags more and more behind the demand for silver.
In other words, paper silver and the trading thereof is nothing short of thievery and trickery since it’s issued with no or little relation to the quantity of actual or physical silver available. Paper silver does not only make it possible to defraud investors directly, but also indirectly, since it can be used to illegally manipulate the silver market.
Can you name one of these bankers and give an example of how paper silver is used by them to illegally manipulate the silver market?
Yes, J.P. Morgan Chase and their naked short selling of silver.
J.P. Morgan Chase, a global financial services firm, holds the world’s largest short position in silver (of which a large portion of the position is naked). To understand the implications of this we need to look at a couple of definitions first…
Short selling – “Short selling (also known as shorting or going short) is the practice of selling assets, usually securities, that have been borrowed from a third party (usually a broker) with the intention of buying identical assets back at a later date to return to the lender. The short seller hopes to profit from a decline in the price of the assets between the sale and the repurchase, as the seller will pay less to buy the assets than the seller received on selling them. Conversely, the short seller will incur a loss if the price of the assets rises. Other costs of shorting may include a fee for borrowing the assets and payment of any dividends paid on the borrowed assets. “Shorting” and “going short” also refer to entering into any derivative or other contract under which the investor profits from a fall in the value of an asset” (Wikipedia).
In other words, you sell assets, normally securities or commodity futures (e.g. silver futures), which you borrowed in the hope of buying it back later at a lower price. You thus expect to profit from a drop in the price of the relevant assets.
Naked short selling – ”Naked short selling, or naked shorting, is the practice of short-selling a financial instrument without first borrowing the security or ensuring that the security can be borrowed, as is conventionally done in a short sale. When the seller does not obtain the shares within the required time frame, the result is known as a “fail to deliver”. The transaction generally remains open until the shares are acquired by the seller, or the seller’s broker, allowing the trade to be settled. Short selling is used to anticipate a price fall, but exposes the seller to the risk of a price rise” (Wikipedia).
In other words, you illegally sell assets, normally securities or commodity futures (e.g. silver futures), without borrowing the assets first or making sure you can borrow it (or that it even exist!).
If you hold a short position you’ve sold assets, normally securities or commodity futures (e.g. silver futures), which you borrowed in the hope of buying it back later at a lower price.
On the other hand, if you hold a naked short position, you’ve illegally sold assets, normally securities or commodity futures (e.g. silver futures), without borrowing the assets first or making sure you can borrow it (or that it even exist!).
More about naked short selling before we move on and look how J.P. Morgan Chase uses paper silver to manipulate the silver market…
Here’s an extract from an article titled “Gold Comedic Value of Naked Short Paper” done by Richard Daughty (alias Mogambo Guru) on the 1st of October 2010 (gold is used as an example but the same principals apply to the illegal short selling of silver):
START OF EXTRACT
And how does this “naked-short paper gold” thing work? Perhaps best explained by example, imagine Apu, famously of the Kwik-E-Mart of The Simpsons TV show. The scene opens with the doors of the convenience mart opening, and in walks some nice, trusting guy, to whom Apu says, “Hello, sir! How may I be of service today, valued customer? A Double-Blast Raspberry Squishee, perhaps?”
The customer says, “I want to buy an ounce of gold.” Apu cheerfully replies, “Excellent! Here is a piece of paper that says it is worth one ounce of gold. That will be $1,000. Thank you! Come again!”
As the scene unfolds, The Mogambo Guru – appearing on The Simpsons in the role of Sgt. Joe Friday – is acting in a terrific scene that is a parody of the old Dragnet TV show. The script continues that Sgt. Friday enters and asks:
Sgt. Friday: Do you have an ounce of gold to back up that paper gold that you just sold that man?
Apu: No, sir, I do not.
Sgt Friday: So you are naked-short gold?
Apu: What is this naked-short gold of which you speak, inquisitive customer?
Sgt. Friday: It’s when you can’t back up your contractual promise of delivery-on-demand of a tangible item with the tangible item already in inventory.
Apu: In that case, yes, I am naked-short, sir! And I am naked under my apron, too!
Sgt Friday: Just the facts, sir.
Apu (brightly): That IS a fact, sir!
Well, the question is not about how the quality of comedic dialog found in Simpsons episodes has suddenly declined, but, “How much money has Apu potentially lost by having a liability of one ounce of gold, for which he “sold” for $1,000, now that gold is worth $1,300?”
Since this seems to be a matter of simple subtraction, I quickly ascertain that Apu has a bookkeeping loss of $300, and a real $300 loss if that guy wants to redeem his piece of paper for the ounce of gold it represents!
Things are different in real life, of course, in that the numbers are all bigger, and nobody refers to me as “valued customer” but as “That crazy old guy is back!” and who see me as, apparently, a goose to be plucked, like the gold and silver naked-shorts of the commodity exchanges are getting plucked, although they are more like vipers than geese.
I wonder aloud, “How much money has been plucked from them?”
END OF EXTRACT
Given the extract above, it should be clear to even the most feeble minded among us what is meant by naked short selling and that it’s illegal, even in this system where the use of paper silver, especially silver derivatives has been legalized as a form of thievery.
Ok, let’s move on and look how J.P. Morgan Chase uses paper silver to manipulate the silver market on a massive scale…
In March 2010 independent British precious metals trader, Andrew Maguire, exposed systemic fraud and manipulation in the gold and silver commodity markets amounting to billions of dollars despite risk of injury to himself and his family. J.P. Morgan Chase traders in London have allegedly sold gold (and silver) on paper to the tune of USD5.5bn without any physical gold or silver available to back any of the relevant sales. Maguire reported the relevant fraud and manipulation to the Commodity Futures Trading Commission (CFTC), which they’ve chosen to largely ignore, despite detailed evidence backing Maguire’s claims.
We can already see some stepping out in defense of J.P. Morgan Chase with phrases such as: “Maguire had a vendetta against J.P. Morgan” or “it’s not possible, J.P. Morgan Chase is the world’s most trusted and respected financial institution” or “these guys are crazy. I am sick and tired of conspiracy theorists” or anything down those lines…
Well, believe it or not, but the “trusted and respected” J.P. Morgan Chase has a history of market manipulation, securities fraud and other irregularities. In fact, let’s give you a few examples, which you can research for yourself if you don’t believe us:
2002 – Blanchard and Co., the largest U.S. retailer in gold bullion and gold coins, files lawsuit against J.P. Morgan Chase and Barrick Gold Corporation for allegedly manipulating the price of gold.
2005 – J.P. Morgan Chase agrees to pay $2.2bn to Enron investors following the firm’s involvement in the accounting scandal that caused Enron’s collapse.
2006 – J.P. Morgan Chase agrees to pay $425m to settle a lawsuit for alleged market manipulation during the technology boom of the late 1990s where initial public offerings were of a concern.
2007 – American Express agrees to drop lawsuit against Visa, MasterCard and individual banks (including J.P. Morgan Chase) for illegally excluding American Express from the bank-issued card business within the States. The settlement amount comes to approximately $2.25bn.
2009 – “In November 2009, J.P. Morgan Chase & Co. agreed to a $722m settlement with the U.S. Securities and Exchange Commission to end a probe into sales of derivatives that helped push Alabama’s most populous county to the brink of bankruptcy” (Wikipedia).
2010 – Idearc shareholders file a class action lawsuit against J.P. Morgan Chase for alleged insider trading, common law fraud and securities fraud.
Ok, given the above, do you really believe J.P. Morgan Chase can be trusted and respected? Hell no! Can you now see the importance of acquiring physical silver instead of opting for paper silver?
Other ways to manipulate the silver market
There are many other ways in which the silver market are being manipulated besides the ways mentioned elsewhere on this website. We will do a brief mention of some and will allow you to decide for yourself whether there are boundaries to the depravity of bankers and their allies in government and other spheres of society.
They’ve now set delivery limits on the paper silver one can exchange for physical silver (at the time this was written). This was never the case before and is a sure sign that way more paper silver is/was issued than the actual or physical quantity of silver available. If not, why have they set these delivery limits?
Central bank “leasing” of gold
Central banks across the world temporarily “lease” gold to investment banks when gold and silver prices are on the increase. This artificial increase in supply normally pushes the prices of precious metals down. They do this in a bid to hide the fact that precious metals, especially gold and silver, are stores of wealth and can be used as money or legal tender. In fact, gold and silver had been used as money for more than 6000 years!
“Western Media” ignores gold and silver accumulation in China
The so called “Western Media” is ignoring the fact that Chinese buyers, of which the bulk are wealthy investors, are buying gold and silver bullion, especially coins and bars, like it’s going out of fashion. In fact, the bankers and their allies in the “Western Media” are intentionally hiding this fact from us who are living in the so called “Western World.” They do not want you to realize that gold and silver are stores of wealth and can be used as money or legal tender. The bastards are more interested in publishing lies about those who have uncovered illegal price suppression in the commodity markets.
The silver market is heavily manipulated by bankers and their allies in government and other spheres of society. All in a bid to mask the fact that silver is a store of wealth and can be used as money or legal tender or as an alternative to the non-redeemable paper notes they create out of thin air. This is the only legitimate explanation for an extremely depressed silver price at levels of around $18 per fine ounce given the low/depleted levels of silver inventories and the growing demand for silver worldwide (at the time this was written).
The illegal manipulation of the silver market will not and cannot last forever. This is why we urge investors to acquire physical silver while it’s still affordable to do so and to avoid paper silver like the plaque itself. The moment artificial suppression blows up in the faces of bankers and their allies the price of silver is expected to shoot up dramatically. It’s after all no secret that once the suppression and manipulation come to an end; supply and demand will find a price level where it can balance. This price level is expected to be astronomical given the 50 years plus of silver market manipulation.
S.C. Treasury Office admits to silver price suppression and other irregularities