As by now all of our readers are aware, JP Morgan's Global Head of Commodities Blythe Masters yesterday appeared on CNBC for a soft-ball interview giving Ms. Masters the opportunity to deny rumors and allegations that JP Morgan is manipulating the metals markets, particularly silver. With a smirk on her face, Blythe informed viewers that 'JP Morgan's commodities business is not about betting on commodities, it is about assisting clients' and 'we have offsetting positions....(manipulation) is not part of our business model. It would be wrong and we don't do it.'
While Blythe's statements' have already been thoroughly dissected and ridiculed ad nauseum (The Doc included), the fact is that BLYTHE WAS NOT LYING THROUGH HER TEETH AS MANY CLAIM, SHE WAS TELLING THE TRUTH 100%.
Here's why:
As our friends at GATA have long alleged, it is highly likely that JP Morgan's 'client' referred to by Blythe Masters is none other than the Federal Reserve- specifically the NY Fed.
| NY Fed Building |
Recall the rumors in the market that a central bank gave orders to dump 1 million ounces of gold on the market in the span of 2 minutes on February 29th. Recall that gold and silver were taken down massively and counter-intuitively last fall exactly 5 minutes prior to the Swiss Franc's devaluation vs. the euro. Recall that gold and silver are routinely smashed whenever the Federal Reserve Chairman is speaking publicly or the FOMC is meeting.
The Plunge Protection Team's (NY Fed's) Brian Sack (who was sacked this week....another story) routinely uses broker-dealers to conduct 'open market operations' to fund the Treasury ponzi. i.e. the NY Fed makes agreements to handsomely reward the primary dealers for taking up treasury auctions with the full knowledge that the NY Fed will buy back the bonds at a premium in approximately a week's time. Would Goldman and JP Morgan be buying $1.5 trillion worth of treasuries annually at 2.5% if they had to hold them on their own books for 30 years? Of course not!
Why should we believe that the NY Fed's intervention in the commodities sector is any different? Someone has to execute the trades on behalf of the NY Fed's commodities intervention. It makes perfect sense that JP Morgan holds their massive naked short gold and silver positions on behalf of their client, the NY Fed, and not as their own speculative bet.
If JP Morgan held these positions on their own behalf, the CFTC would likely not be in their 4th year investigating silver manipulation. The DOJ would be involved, and let's just say that Blythe would not be making charity appearances donating millions of dollars to community colleges in Colorado.
Unlike JP Morgan, the Federal reserve would have a variety of motives in suppressing the price of gold and silver, managing the metals markets with an iron fist, and ensuring the metals are smashed upon any significant macro-economic news intuitively harmful to fiat currencies.
Gold and silver are anathema to central banksters, who make their living by sucking the value out of the population's currency through inflation and currency devaluation. The Federal Reserve has every motive to ensure that this process can continue unnoticed by the masses, until the wealth transfer is complete.
Imagine if the American people en-masse became wise to the scheme and began saving their wealth in gold and silver rather than federal reserve notes which the NY Fed can run off by the trillion with a simple keystroke? The entire con would be up overnight!
Gold and silver must be managed and controlled by the Fed until the wealth transfer is complete, at which time they will be 'revalued' higher. Ben Bernanke has already informed us of the exact plan back in his famous 'Helicopter' speech! Gold revaluation is the end game, but until then, it is management, suppression, and intervention.
When Blythe Masters yesterday claimed that 'JP Morgan holds their metals positions on behalf of clients', that 'JP Morgan is not in the business of betting on commodities', and that they 'are not running a large directional position', she was likely telling the truth.
-Doc
'There are no markets anymore, just interventions'
20 comments:
Obvious.
Glad to see you still read zerohedge...
When you say "revalued higher", are you implying that the price of gold and silver will jump so high overnight that almost nobody will be able to afford it? Or do you mean the price rise fairly rapidly but over the span of years?
Why wouldn't the FED just print 1 trillion orso and buy a big mine themselfs? Why would't GS just buy silver with their profits to fill their wharehouses?
Can someone explain to me why this analysis does not include the previous FOMC meetings where gold and silver went straight up? Honestly, it's about 50/50 so stop lying. In fact, Peter Schiff often says, if gold is going up you can rest assure Ben Bernanke is speaking somewhere. Before the last couple meetings gold and consequentially silver went straight up when the minutes were released. Once again, lets not let facts argue against our insanity.
Crusso33, it depends on what they say in the meeting. If they hint at QE, it goes up. If they say everything is peachy keen and no QE needed, things go down. The action depeneds on what info is released.
I love how you can tell the importance/ significance of one of Doc's posts based on the volume of the trolls. lol
great analysis........thanks guys
That snarky little tart is cute in her own devlish way
So DOC, how is this all going to play out? Why buy phyzz when the market is completely rigged?
What did Turd see in her? She is a bag.
She needs to strung up from the nearest tree when the financial system collapses. Along with her cronies
She is neither cute nor clever. Just a very nasty piece of work doing the Devil's job.
Because the market is a PAPER market!
So, paper money is, what, a Paper Tiger !
Blythe= Devil's Double
why are you guys pissed off at Blyth? Shouldn't you be pissed off at miners? They short silver to hedge their production right? So, they must be your enemy too!
NOT! When she says "We (JPM)have no interest in price direction.." Bull! Doc, If what you say is true and she works on behalf of her client the FED than of course they(JPM) have a very, very stong interest in keeping the price suppressed! Duh? No matter which way you cut it she is a lying,scumbag crook who is stealing our net worth!
If this is correct, then the manipulation attempts will not end until the US collapses or the tptb decide to pull the plug. The reason being that the justification the government will give for taking such actions are reasons of national security. I remember reading along the lines that when Senators or Congressman are forced on the issue of manipulation in markets or the Feds action that they stonewall with the national security card. The most nefarious actions of the US government are hidden and justified by saying it is for national security when it is for control, greed and furthering the goals of psychopaths that have risen to the top.
But if she knows the reason the NY FED, her customer is doing, it then she is lying. She is manipulating on behalf of someone else, and they use HFT to smash it, then the Fed buys it up once price is smashed, and JP reaps big profits from their short positions.
Sounds like typical antigovernment, monetary scarcity ideology crap to me. Only a very small portion of the population actually benefits from high Gold prices. Wanting high Gold prices according to this paradigm is the same as wanting 90% of the population to be living like an average worker in China or India.
If you think Gold will solve our monetary ills, than I suggest you advocate for it with no Gold holding at all. Anyone who argues for a Gold monetary standard is simply trying to increase the exchange rate for what they already have since Gold is almost worthless without it being used as some kind of money at this point in time.
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