Fighting Back

If you're depressed and despondent over the price action in the metals, don't be. It's all simple, option expiry nonsense and it will get better next week. Besides, I have some happy news for you today...The Good Guys are fighting back.

You'll recall that late last year, the U.S. District Court in New York dismissed the civil suit for silver manipulation against JPMorgan. At the time, The Court granted the plaintiffs 30 days to re-file. Today, I'm happy to share with you that they, in fact, have re-filed and are quite optimistic about their case going forward.

First up, here's a link to the summary written by Turdville Attorney General CALawyer in the days immediately following the dismissal. You might want to review this again before going forward. http://www.tfmetalsreport.com/blog/4408/guest-post-summary-silver-civil-suit-dismissal-calawyer

Upon receipt of the filing yesterday, I once again sent it off to CALawyer for his opinion. Time was short so he was only able to reply with the email below. We are all in his debt for taking the time to review it. Again, CALawyer, THANK YOU!

Hey Turd:
This is my quick take.  I read the Motion for Leave to Replead.  It is very standard, and should be granted.  Routine pleading, nice summary.  The defense will oppose, claiming that even with all the new proposed facts, the new facts do not make a difference and thus, the Motion for Leave to Replead should be denied.  It is a very low hurdle for Plaintiffs, and the Motion is almost certain to be granted, based on the new facts from the Proposed Second Amended Complaint.  My read of the proposed new complaint is that this should be enough to make out a case.  That may or may not be enough to get discovery launched, but the absolute last thing the defense wants is an army of Plaintiff attorney's scouring through the JPM documents.  No TBTF bank wants that, ever.  I hope, but I do not know, that the court will grant discovery on this based on the showing of alleged facts from the new complaint, though.

For example, look at this new allegation, at paragraph 137.  I like this quote a lot:
"e. As a sophisticated and large market participant as well as a
market maker on the London market and clearing member of COMEX, JP Morgan
well knew each of the foregoing facts as they occurred. By selling in the small
COMEX market, JP Morgan knew that it received lesser sale prices because it had a greater depressant effects on prices. Thus, JP Morgan repeatedly and
uneconomically incurred additional transaction costs in order to sell at the lower
prices it caused on COMEX. JP Morgan thereby intentionally acted contrary to the
conduct of a hedger by repeatedly incurring greater transaction costs. It did so in
order to depress prices."

This allegation is tight, and makes out a compelling case, because it finally shows that JPM's behavior is illogical and hence, that leaves only the conclusion that it was manipulating prices.  The distinction between the Comex and LBMA as far as price, volume, etc., is critical.  Rhetorically, then, the obvious question that is asked, "Why would JPM hold a large short position on Comex to hedge when hedging on Comex cost more than on LBMA?, is then answered: "Because it wanted to manipulate prices despite the costs to do so because it made money from depressing prices, which ultimately means it was not hedging at all, since JPM would not hold a hedge that lost it money when it could hold the same hedge on LBMA without losing money."

I like the substantial allegations at paragraph 137 a lot.  This could get real interesting if discovery is allowed. 
That decision is the next real test, not the next motion to dismiss.  
Thanks for letting me weigh in.
Anytime you need something my friend, just ask.

Sincerely,

CALawyer, Esq. Attorney General de Turdville

OK, with that, the documents to review are below. The have been filed with the court and are fully public. At this point, we'll need to let the process run its course so no need to get carried away today. However, I felt that it was important for you to know that The Good Guys are continuing the fight on your behalf. Wish them well and Godspeed.

TF

FINAL - BRIEF of JPM CIVIL SUIT RE-FILE by Turd Ferguson

Second Amended Complaint in JPM Silver Manipulation Civil Case by Turd Ferguson

505 Comments

ag1969's picture

Puck

I am leaning toward getting some generic rounds today over the junk silver.  I am astounded by the premiums being charged on junk now.  It is cheaper for me to buy 20 rounds than to get 20 oz in junk, which if my math is correct, is $28 face.  I, like you, have been purchasing lots of junk lately, but with this mornings dip, the junk at Provident did not come down.

As I write this, $28 face of Franklins is $707.56.

I can buy a tube of twenty of these for $640.20

http://www.providentmetals.com/bull-and-bear-1-oz-999-fine-silver-bullion-round.html

What say you?

indosil's picture

@Dr Jerome

yes..you are absolutely correct....but somewhere down the line..the algos follow these charts...they can't be programmed w/o following the charts..yes sudden jump in volume will make the charts haywire & they do..but it's a good tool to try to get even if not beat TPTB....

I fully respect your analysis & feel the same.....but we do need to strive & struggle hard....don't we??

Besides i would hate to see Silver that lowsad....

Puck T. Smith's picture

@ag1969: Franklins and other

@ag1969: Franklins and other halves always seem to get a higher premium.  My local shop doesn't make any distinction, but with sales tax it is brutal.  Last $10 face I bought there ran me almost $280.  I can't stand that kind of hit.

I just ordered $10 face from JCSGold for $232.47, $246.42 including shipping.  It's not Franklins, but "We Choose," so I'll probably get some Roosevelt dimes and Washington quarters, but current melt is is about 224, so that about 4% premium not including shipping, 9% with shipping included.  Comparesilverprices.com is showing most places from 4% - 7% on rounds, plus shipping.

That say I. 

 

Keg's picture

John Williams - Dollar sell off in 4 months

I respect Williams more than any of the other talking heads.  For the most part his analysis is based on numbers.  Still, I doubt his dollar sell off call.  After the dollar declines to the point that TPTB think is as low as it should go, we will start hearing how bad things are in Europe.  The PIIGS will be all over the news again. 

achmachat's picture

ag1969

go for the .999 pure rounds.

babaganoush2307's picture

@ I run bartertown

RE: comment from page 3, I agree that if you can survive the collapse then the after party will indeed be epic.  Back to the golden age of prosperity for those who made it through!

babaganoush2307's picture

@ I run bartertown

RE: comment from page 3, I agree that if you can survive the collapse then the after party will indeed be epic.  Back to the golden age of prosperity for those who made it through!

Mickey's picture

dollar sell off

who can time this mess?

its been happening  all along--look at the price of gold and silver in US dollars over the past 12 years

Zoltan's picture

Another Lease Rate Spike Down the Memory Hole

Gold Lease Rates
January 28, 2013
1 m -0.0933% +0.2000
2 m -0.0745% +0.2455
3 m -0.0405% +0.2995
6 m 0.0638% +0.4738
1 y 0.3355% +0.7855
Silver Lease Rates
Jan 28 2013 Change
1M -0.2973% -0.2973
2M -0.2525% -0.2525
3M -0.1985% -0.1985
6M 0.0258% +0.0258
1Y 0.3475% +0.3475

I know there is no hat on the line this week but what about a close of 1650/31 on the options expiry.

Nothing new under the Sun.

Z

tyberious's picture

My Dear Extended Family,   I

My Dear Extended Family,

 

I have been working constantly since Friday to answer your emails. Being indoors all this time, I had to go out and get some fresh air. To my astonishment upon my return there were more incoming emails than I have answered in the last three days. Clearly, I will not get these all answered, but that does not mean I am not going to try.

 

I understand the responsibility of giving you my opinion. To say I understand the serious nature of what I say is a world-class understatement. The people I am speaking to are not the leveraged paper traders in gold. I am speaking to those who have invested in gold without borrowed money as protection against the instability of the Western world's financial condition.

 

There is no question whatsoever in my mind that gold will trade at and above $3500. The volatility in gold is only going to become more extreme, so you crazies who are in gold on heavy margin are beyond my help.

 

If you are so concerned that you cannot think straight, what are you doing investing in anything? I willingly stake my over 50 years in this business to tell you gold will trade at $3500 and above. I have committed 100% of what I am and have to my gold related position. I have zero concern about my gold investment. Absolutely none whatsoever.

 

I told you when gold was forced back under $1000 that it would trade at $1650 and above. For that analysis, I was scorned by many who are the same personalities that today are the outspoken bears.

 

Gold will trade at and above $3500 and no manipulator, private or public, can stop it. Gold is not for the weak, but then the weak will not survive this crisis in Western finance trying to be hidden from view with every possible public relations weapon.

 

For all the bears communicating with me tonight, you are totally wasting your time.

 

Sincerely,
Jim

Nana's picture

:)

boatman's picture

Mickey

preciate the Don Coxe heads up.

lets see if it'll  link[one might have to join scribed]:

http://www.scribd.com/doc/118411362/Don-Coxe-Basic-Points-December-2012-the-Final-Problem

Monedas's picture

Buy the pretty government rounds !

They're subsidized !  Even the Canadian mint is rationing .... and surely .... they don't have to pay all the equal opportunity hires (Negroes) .... the US Mint is burdened with .... pardon my plain talkin' Monedian english .... but, it is how I choose to express myself !     That Kiss night club fire .... arrests are being made .... band members and owners .... so far .... government inspectors, firemen, policemen ....  who obviously took bribes .... to let Kiss open .... without a paid up permit .... overcrowded .... without adequate fire exits .... (none, actually) .... the untouchables .... no arrests yet .... LOL !        Monedas      1929        Comedy Jihad Indignant Hillary Still Hasn't Sorted Out Benghazi World Tour    devil   PS:  Surely, the Mexican, Austrian, Australian, Chinese, English, etc. government coins will sell out, too !  The margin on corn flakes .... is way higher .... than government, show piece coins ?

Groaner's picture

I have noticed that Mcguire has not has his trades updated

in a week or so.. Is he purposely on the sidelines out taking some time off?

Eric Original's picture

Awesome post, FleetFeet!

Awesome post, FleetFeet!

Dr Jerome's picture

All we've got

Indosil--

Yes, I agree. And having these tools if far better than hunches and guessing. What they certainly indicate is something about the psychology of individual traders all headed the same direction at the same time. That information is essential. And it is the same data that the algos are processing. But don't they have access to data on orders placed and stops? Talk about an unfair playing field!

I place quite a bit of value in intuitions in trading--not that I act on them directly, but that they compel me to dig deeper and look from another perspective. Our subconscious minds are amazing and often it will spot a trend or a datam and then bypass our cognitive reasoning mechanism and poke us with a "bad feeling." The philosopher John Henry Newman called this the "Ilative Sense" and argued that it is a valid epistemological process.

I have a bit of time now and decided to work on a method of predicting a closing price at AG futures options expiration based on the "most pain for little guys" thesis. Hopefully I can post something fun in about three weeks.

tyberious's picture

  Parallel Dimensions: An

 

Parallel Dimensions: An Update for the Precious Metals
by Joshua Enomoto, Founder of ContangoDown.com and FutureMoneyTrends.com contributor
Let's face the immediate facts: the precious metals market has turned yet another ugly corner in a ghetto full of ugly corners. While we have seen this sector pull away from the brink of disaster, is another miracle upon us? Ultimately, the long-term answer is optimistic for the entire commodities sector but we also need to acknowledge that within a secular bull market, there will be periods of short to intermediate term weakness.
Much of the meteoric rise of gold to $1,900 was based on pure monetary policy, otherwise known as letting the printing press operate at full blast. And why not? Federal Reserve Chairman Ben Bernanke is a notorious Keynesian economist and his dissertation regarding the Great Depression and fiscal illiquidity is referenced both in academia and pop culture. It would have been a contradiction of the highest order for him to squeeze the monetary base during the financial collapse of 2008, at a time when the entire nation was teetering off a very precarious ledge.  Of course, Mr. Bernanke was all too happy to oblige, firing off inflationary programs euphemistically labeled "Quantitative Easing." The first two editions took both the equities sector and the precious metals soaring, which was the whole point of the matter. According to the Keynesian perspective, a financial disaster can be averted through the pumping of liquidity, which in turn would theoretically induce confidence in the markets. Higher gold prices just came with the deal.
While monetary discourse will always draw heated debates, it could be argued that QE1 and QE2 accomplished their objectives: banks confirmed excess reserves on their books and the national money supply, which was contracting for much of 2009 and 2010, went from moderate growth to rapid growth in the summer of 2011, as evidenced by gold's parabolic run. At that time, many saw no need for further easing programs, as the return on investment would exponentially decline and economic activity would not be substantially stimulated.
 
Yet here we are again, only a few months removed from an official QE3 and a de-facto QE4. Those that have argued in the past that further quantitative easing would have little effect were proven right from a short-term perspective:
 

The above is the 1-year daily chart for gold bullion, layered in with the US Dollar index. As you can see, for much of the past year, gold and the dollar shared an inverse relationship: as one went up, the other went down, as has been the case throughout much of the current commodities bull market. However, a strange occurrence developed in November, when gold and the greenback began to share a corollary relationship. This was evidenced most recently on Friday's (Jan 25) market session, when both assets tanked.

 
As expected, silver began to show the same odd correlation with the dollar:
 
 
Of course, noted gold bears and  "johnny-come-latelys"  have swung with full force, claiming that further issuances of QE are suffering from a declining rate of return and that this will be the end of the precious metals bull market. While I agree that QE3 and "QE4" have been a disappointment for gold and silver, talks of the bull market's demise have always been premature and will likely be premature again.
 
First, not all precious metals have been affected negatively:
 
 
Palladium is regarded as one of the more obscure precious metals and is heavily demanded by the automotive industry. Since late November, as the dollar weakened from "QE4," the other white metal began a steep challenge of the $700 level, eventually overcoming it and closing just south of the $740 mark. It too had a moment of direct correlation with the greenback which lasted for roughly a month and a half: this confirms that mere correlation with the dollar is not necessarily bearish and could lead to greater gains.
Second, we have to consider that other sectors, most notably the S&P500, benefitted dramatically from Bernanke's most recent monetary exploits from a nominal perspective, yet the market participation has been on a noticeable decline. This brings up the specter that current record highs in the equities are merely psychological speculation towards a monetarily supportive Fed; an assumption that may bring about unintended consequences.
For now, we have to acknowledge the facts: the metals have lost some near-term momentum and that usually brings the bears out of hibernation. Yet at some point, the precious metals will unhinge themselves from its current corollary relationship with the dollar and will eventually begin another challenge upwards.
Mickey's picture

Has anybody

seen anything about last weeks US Financial Statements in the media anywhere? After all, losing $6.9 Trillion on $2.2 Trillion revenues takes some effort. (or more appropriately lack thereof of any effort).

All we ever see is the spun good news, whic his part of the scheme IMO to keep a lid on gold.

Is the media so screwed up its cannot report reality?

opticsguy's picture

$xau/gold down to Nov. 2008 levels

incredible

Urban Roman's picture

Oh well ...

it was just another LULZY thing I stumbled across. Guess it went  over the line. 

Of course, when you think about it, how could you help someone in that predicament? I'd be inclined to just run away from the tractor beam...

I did not play the game on the SSEC site. I trust that it was there, however. After some reflection, I think that this is not just a phony facade erected by some TLA. I think it was the LULZY work of hackers. But that's just my opinion. 

achmachat's picture

site specific index

these must be the lowest hanging TITS in the history of TFMR.

Mammoth's picture

Junk vs. .999 Bullion Rounds.

@AG1969, Puck, achmachat

Just remember that when you finally go to sell, buyers will be more suspicious of those generic bullion rounds being counterfeits, than they will be of the circulated 90% Silver US coins.

This is why I prefer Junk Silver.

(Plus, there's the 'cool-factor' these old coins possess!)

thurd aye's picture

I'm just about to get out of

I'm just about to get out of ZAR(Rands).It is getting pulverized by everything!

Thank (your Choice), I am mostly in metals,no lead unfortunately.Pass the ammo.

That Santa guarantee of 3.5k Au is brilliantly reassuring to me. ;o))

Mad5Hatter's picture

goldfinger

OK, when I saw haarp vid, and 10B watts, that was it, the mind just went to goldfinger, and not the chick painted in gold, but FORT KNOTT itself, ITS EMPTY!!!, those MF!!!! ..... secertly melting the last of the nation teasure.. meh.... that those it!! Im pisst. Someone should point haarp at the CRIMEX for a grand urology show, and really deplete the COMEX, for the super squeez for the yellow river ... YIKES!!!!! Turdville you into that too. ggeeeeezzzzuuuuusssss, i mean, Turd asked, where did it all go. .... whats next ......

In makes complete sense, given today's tech, to build a massive phase array radar, built on an ocean platform, and moved, to monitor, and yes, used to guild interceptors intercepting launched missiles, and such a platform as shown, one in  the water, heading toward NoKo, threatening war, with deployed missiles, would be generally consistent with such a massive phased array radar, and its use, to suggest otherwise, goes back to the one liners.....

One dosent create nefarious conspiracies just in passing..... (yeah, right, stick around).

MEH .... is this place entertaining!!!

if anyone wants a summary of phased array radar, just hallar.

I did not know trekies stacked ......

And, Im not buying for one mintute, slim pickens road an newk bomb out of a bomber (the subtle give away was the lack of a saddle, ..... I aint that stupid, on the freakin floor!!)

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