Futures Manipulation - Third Branch Getting Involved

Thu, Jul 31, 2014 - 12:46am

Whether this is misplaced hope or a sign of good things to come is certainly anything but certain. Articles abound regarding recent lawsuits filed against CME and big banks, for example:




I am just buried in pressing deadlines, but my plan is to dig into the CME lawsuit, and give an analytical, critical opinion on the likelihood of that lawsuit surving a 12(b)(6) motion to dismiss as well as the likelihood of any real discovery getting done. Give me some time, and I will complete my analysis and post my thoughts.

For now, though, read these articles, and ask some questions, like these:

(1) Why are these lawsuits getting filed now?

(2) Are these lawsuits any sort of a planned distraction so that we do not focus upon the real swindle?

(3) In light of the other wordly, newsworthy headlines, not the least of which is the outbreak of the Ebola virus in what seems to be a radically more virulent manner, do the lawsuits really matter that much at all in the bigger picture?

(4) Congress, that bastion of buffoonery, has just authorized a law suit against Obummer. Not only does this immediately reek of cowardice, but it seems readily apparent to be unconstitutional on its face. Just like the President could never order Congress to do anything and try to enforce it with a lawsuit, the Congress cannot use the judiciary to force the executive branch to take or cease taking action. Congress is extremely powerful, when acting within the Constitutional framework, that is, as a unified body on behalf of the people. But, when the members, along party lines, vote to allow a lawsuit to be filed against the President, we have truly turned into a banana republic. What's next, defaulting on debts followed by a military coup? How can the third branch do anything but dismiss the lawsuit?

Similarly, understand the nature of judicial relief. Federal lawsuits, especially class actions, are not really conceived to redress a real legal problem. Rather, they are more geared to enrich lawyers who bring them as well as the top tier law firms and their mega wealthy lawyers who defend the elites such as the TBTF banks.

So, unlike the pundits who are selling their books, I am not immediately enamored of all the sudden lawsuits.

Like frequent poster Madhatter wrote at least a year ago, one of the most logical lawsuits that could be filed, if one wanted to truly get to the bottom of the manipulation and suppression issue, is a lawsuit based on either common law fraud, or federal law such as the Sherman Antitrust Act. If the banks were acting together to suppress the price of metal, then that would seem rather clearly to be a "contract, combination or conspiracy in restraint of trade." Why then, is not a single lawsuit filed alleging this?

My theory on this is truly simple. There is no lawsuit because there is NO incentive to do so. There is not enough reward relative to the risk. Until that equation changes, I will not hold my breath.

On the issue of the lawsuits, if one posts a link, I will do my best to download the complaint and take a look at it. So, by all means, post away and include the lawsuits the court and case number if available. Thanks in advance!

About the Author


Spartacus Rex
Aug 4, 2014 - 3:28pm

@ ancientmoney CFTC - JPM

There is a reason why these exist:

Cheers, S. Rex

Aug 4, 2014 - 2:38pm

CFTC hands down "killer" fine to JPM . . .

Wow. $650,000. That probably doesn't cover Jamie Dimon's "laundry" bill.

"The CFTC Order specifically finds that since at least 2012, the CFTC was notifying JPMS about errors in its large trader reports, which increased in frequency throughout the year. CFTC Regulations require FCMs to submit information on a daily basis for certain large traders, such as the number of open futures or options positions; the number of delivery notices issued or stopped; and the number of Exchange For Related Positions (EFRPs). In December 2012, the CFTC notified JPMS that the on-going problems were unacceptable. JPMS, relying on its third-party vendor that generated the reports for JPMS, assured CFTC staff that the problems would be resolved on or before the end of January 2013. However, JPMS continued to submit large trader reports that contained hundreds of errors throughout the period from February 1, 2013 to February 2014. . . . In addition to imposition of the $650,000 civil monetary penalty, the CFTC ordered JPMS to submit a certified statement of compliance within 120 days of the entry of the CFTC Order stating that it has completed enhancements to its systems and procedures related to reporting of delivery notices and EFRPs, and has tested such systems and procedures to ensure that they now comply with the requirements of the CEA and CFTC Regulations."


I bet JPM is quaking in their boots! CFTC knew for almost two years of this fraud, and after telling JPM to stop, they doubled down. I wonder how many $billions they cheated people out of during that time?

Now, they get 120 days to say they won't do THAT anymore. Rightttttt.

ancientmoneySpartacus Rex
Aug 4, 2014 - 2:32pm

S. Rex re: CFTC charges JPM . . .

The link was taken down--page not found.

What a surprise.

oops--just got to sierra skier's link--it worked.

Aug 4, 2014 - 12:15pm

fwiw, my 64 painted kennedy half....

....is on of my favs.....the gold proof kennedy will be better.....and regarding junk, remember when the premiums soared a while back? that'll be an additional 30-40% gain minimum not even counting the base price...and IF there is some bartering necessary, try taking some tin snips to a round and see how accurate you can cut....plus, johnny litewallet can afford and there's only so much...marchas, come back!

sierra skier
Aug 3, 2014 - 11:38pm
Spartacus Rex
Aug 3, 2014 - 5:35pm

CFTC Charges J.P. Morgan

CFTC Charges J.P. Morgan Securities LLC with Repeatedly Submitting Inaccurate Large Trader Reports and Imposes a $650,000 Civil Monetary Penalty


Spartacus Rex
Aug 3, 2014 - 5:31pm

@ Rainforest "no verifiable correlation"

That is correct and has been well known for years ever since such was pointed out in the beginning by the numismatic folks, and yet many still are willing to pay the premium for such just as they willing pay the bogus premium for a slabbed PCGS 70 over an NGC 70. Care to guess how many times a ripped off customer of PCGS resubmitted a PCGS 69 to NGC in order to just have it correctly slabbed as a 70?

Each buyer has their own peculiar set of values in the marketplace, and it has been that way since the dawn of civilization.

Cheers, S. Rex

Aug 3, 2014 - 10:41am

First Strikes

The term first strikes was just a ploy to extract more premium from unsuspecting buyers. now they try and dupe you with the early release and first day release labels. there is no verifiable correlation between when a coin is struck versus the date it is shipped from the mint.

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Aug 3, 2014 - 10:10am

@loriewil - it's USD for oil


Looks to me like Repsol got its resources stolen by the Argentina government.

Repsol then was repaid with bonds valued to the resources "expropriated".

Repsol wanted to develop "Vaca Muerta" which is now under YPF control.

Looks like the Repsol bonds are identical to the defaulted Argentina bonds.

Rather than having two bonds of the same ISIN (which is the official explanation), wouldn't it make more sense that Argentina stiffed Repsol and gave them the defaulted bonds that were being held by Argentina's own treasury?

Makes you wonder if Argentina was on both sides of those notes. One wonders if Argentina's government repurchased some of those defaulted notes and is holding the contracts themselves.

Spartacus Rex
Aug 3, 2014 - 5:40am

@ So It Goes "bit pricey"

Actually, gram for gram it is still slightly less then three $5 Half Eagle HoF's. However as the Gold Kennedy Half Dollar will be another first of kind, as well as first U.S. Coin ever to have 50 Stars on same, it will become a collectible and given the current F*N fiat price of gold, sales could actually be lower than otherwise anticipated. Did you Notice the 5 Coin Limit versus the 50 Coin Limit w/ the HoF's? And you are correct, First Day Orders quickly get slabbed as First Strikes and command premiums, so try not to miss the open this time.

Cheers, S. Rex

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