Fighting Back

502
Fri, Jan 25, 2013 - 12:20pm

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. https://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

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  502 Comments

57Goldtop
Jan 27, 2013 - 4:47pm

Dagney

Thanks. For some reason I thought you were a Canadian doing business in the U.S.

I always liked Canadian gov't contracts better when they were under the competitive bid limit. Competitive bidding always seems to mean that the preferred vendor prepares the RFP. And here we have the Canadian version of unintended consequences: competitive bidding obliterates competition.

A wise man once told me: pitch your new product to a Canadian company, and they say "Come back when you've sold 10". Take it south of the border and they say, "Do my competitors have this? I'll take 10."

Kcap
Jan 27, 2013 - 5:03pm

I promised myself...

years ago that TA was in the past for me as it is an ineffective tool in todays blatant manipulation of markets...

HOWEVER....I have mentioned that the big picture, macro TA is generally fine as they can't really tamper with it in the short term shenanigans.

So...since the board's seeming somewhat down and depressed about things like Armstrong's piece (who is a f'ing moron) and the general catastrophic feeling about the metals markets...you all need to know this:

We have a 30 year cup and handle. Did you hear that? 30 years!

We have a low of $26. THERE IS A DISTINCT reason for this. Below $25+ is a VIOLATION of this 30 year cup and handle. Silver cannot drop below this $26 mark for this cup and handle to be valid.

Now...I don't believe they will violate the cup and handle, do you? Think about it.

1980 = $50

2011 = $50

The two tops of the edges of the huge cup. Why so perfect? Why to $50....why was the run in 2011 "allowed" to run to $50 and then creamed to drop immediately, so as to ONLY allow for this ultimate formation?

THINK! (sorry, i get worked up!)....but, think about it. Its all too perfect is it not?

Drop the nonsense of silver going below it. If it does, they screw themselves....they will make a lot of money on this run.

Have a pleasant night.

Kcap

Ircsum
Jan 27, 2013 - 5:10pm

Meanwhile.....

Gold is not looking particularly healthy on the daily:

It's in a downward-sloping range & topped out last week. It also dropped from a triangle in mid-December. Silver is in a similar situation in terms of being range-bound:

I'm as bullish for the long term as anybody here but, short term, we may have some pain in store. I'd hold off buying for a week or two....jeez, I have to as I've no spare fiat.

Then again, things may reverse on a pin & head for the moon, but WTFDIK.

¤
Jan 27, 2013 - 5:24pm

Fairies Wear Boots

Black Sabbath - Fairies wear boots(+lyrics)

ag1969
Jan 27, 2013 - 5:30pm

So there might be some short term weakness....

I think what we have here is two ways of thinking. I don't know why am writing this or why Ircsum's comments got me thinking. It seems to me that we have people treating this as an investment or a trade, and another camp that views this as a war. A righteous war that is the Achilles heal of the psychopaths that have hijacked our constitution, inalienable rights, way of life, social fabric, economy, money, and most egregious of all, our children. All that stood for "The American Way" has been demonized as we celebrate mediocrity, compliance, and immorality.

Silver is the Achilles heel of this system. Price does not matter. I won't wait two more weeks for a better price because we have them on the ropes. For me it is about winning the war, which I believe will only happen when all the silver is gone. Buy that shit up, buy the fucking dip, and win this thing. Waiting two more weeks to fire your bullets just gives them two more weeks to paper over their latest weakness.

Germany has requested their gold back, and as we all anticipated many countries will follow.

Central Banks don't trust each other, period. And why should they? They are the greatest assembly of complete assholes on the planet.

ASE suspension....twice in a month! Rationing

Canadian Mint, rationing

Tulving, Provident, LCS and many more either out of lots of inventory or reporting unusually strong sales

Fed reports massive withdrawals from US zombie banks

Benny printing 85 billion/month....that we know of anyway

Gun Grab a total sign of desperation

Abe in Japan going all Zimbabwe with Benny

Every physical ounce removed is leverage 100 to 1, derivative time bomb

Don't wait two weeks to buy silver, eff the charts. At this point it is all about making physical disappear. I don't give a rat's ass whether I pay 32 today, or 29 two weeks from now. I ordered today, and I have ordered 10 times since Christmas, along with a few LCS visits. The saying is not, "If you see the whites of their eyes, wait two weeks". Fire everything you've got and make these assholes burn. They know we are coming for them and you are witnessing desperate acts from desperate men. Buy, Buy, Buy!!!

Tick Tock, Tick tock, buying today runs out their clock.

Byzantium
Jan 27, 2013 - 6:01pm

@ ag1969

I respectfully disagree; timing does matter.

I speak with regards to people who already have a core stack, and who have the luxury of considering how to proceed from there.

It matters, not only with regards as to when to buy, but also as to when to take profits / divest / switch asset classes.

Fine tuning our abilities at these suppressed price levels, can help build the disciplines needed for the moon-shot too. Because if / when we enter a mania phase, we will have a totally different dynamic and type of decision to contend with. Failing to develop guile in the accumulation phase, bodes ill for the latter, equally important phase.

my 2 cents.

Urban Roman
Jan 27, 2013 - 6:03pm

Colors of alloys

Has everyone seen this chart from Wikipedia?

ag1969
Jan 27, 2013 - 6:04pm

Point taken Byzantium

Maybe I am just growing impatient, I don't know.

opticsguy
Jan 27, 2013 - 6:14pm

Transcript of CBS broadcast of academic DB denouncing

the constitutional form of government. Great idea. Instead of a document codifying our rights, lets have whatever dictator or king that is in power grant them to us. I'm sure he'd like to live as a serf in 13th century Europe.

https://www.breitbart.com/Breitbart-TV/2013/01/27/CBS-Runs-Segment-Calle-Lets-Give-Up-On-The-Constitution

Byzantium
Jan 27, 2013 - 6:15pm

@ag1969

It's all good; just different value judgments.

Let the reader decide for themselves what works for them.

Late edit:

With regards to physical, you may well be right that to delay, will result in there being none left to buy.

¤
Jan 27, 2013 - 6:22pm

movie

If anyone is interested....The Philadelphia Experiment

https://www.tfmetalsreport.com/comment/586760#comment-586760

silver66
Jan 27, 2013 - 6:36pm

Perhaps Santa is right

MSM discussing old news from Santa , lifted this link from the front page of Drudge

https://www.nytimes.com/2013/01/28/business/debate-shifts-at-fed-to-easi...

Silver66

Green Lantern
Jan 27, 2013 - 6:39pm

Daveyboy,While I don't have

Daveyboy,

While I don't have the energy and free time to write a well supported argument, because such a dissertation would take pages of well footnoted evidence. So my stream of conscious thoughts on the matter will have to suffice. As usual, unedited.

The fact that you have a friend in close proximity to Zimbabwe really doesn't do much to support your argument about Zimbabwe and their is no dirth of well documented tomes on the decline of Zimbabwe for all of us to read discussing the multiple currency failures, that can't be looked at as independent phenomena separate from total government tyranny, wholesale land reforms where private sector land was taken from the people, the private sector business was dismantled and made all but impossible for any private business to succeed. And the rule of law wasand is non-existent. Yes, gdp fell significantly and the agriculture industry was destroyed by land reform. Price controls, and government hands in every till. To that extend your arguement is correct. But it is not mutually exclusive from a monetary policy of monetary debasement with inflation rates estimated anywhere from 8,000 to 150,000% per year. (CATO)

I have said before that inflation and debt are symptoms of a more primal disease. Tyranny, imperialism and unfettered expansion. Where one exists tyranny, you'll find the other. I open to changing my mind if somebody could show an example of where the two didn't co-exist within in any failed civilization. It makes absolute no sense to suggest that money printing didn't create hyperinflation when Zimbabwe's multiple currency redominations and failures, and gross debasement meets every economic definition of debasement and hyperinflation. It didn't occur as an isolated factor. True. But to try to separate the effects of government tyranny, lower GDP and money debasement into some unrelated events makes no sense. . I'd suggest that nothing less than a wholistic model of government behavior and resulting economic realities is going to serve anybody to see how all these factors are intrinsically connected.

Your argument which is now a common one, somebody posted some silly video the other day of some guy telling us gold isn't money and debt is good, and a recent book "Debt: The First 5,000 Years" which many here already dealt with, ignores the consequences that comes with unpaid debt. It doesn't matter how much it has been used historically, if you never look to see the consequences of it. And while some people can get away with breaking contracts to some parties, it won't work with all parties because a day will come when they will collect. And that day is today. It's called Gold repatriation for one.

It is also through these broken agreements that our country is being given over to China one piece at a time as we hand over tracts of land. State governments credit cards are not being accepted at gas stations in some states. They are loosing their real estate and have to rent offices from new landlords banks or Chinese real estate moguels. Individual business's are not receiving payments for services rendered on behalf of the state. The effect of that? They stop offering their services, lower GDP. Extension of debt is which has caused 200 years of boom and busts. The injection creates a stoned europhia when it comes into the system. When it exits the system, heavy withdrawals. And then, we get more people yelling for more.

If this would have gone on for 100 years maybe we would have experienced a garden variety recession or depression until all the reinvestment was flushed out of the system and the economy returned to a healthy equilibrium. But after boom/bust cycle on on top of the other, the system is stretched to the MAX. It now requires much more of the paper drug to expand just a little.

Slowly people are starting not to accept the credit worthiness of the United States. You can't expand what people will not accept. But if anything should be a stark example of this is the call by Germany to repatriation of Gold and their declaration that they no longer trust us to hold their gold that more likely than not already been spoken for multiple times. Now we wait for the Netherlands, and Italy to make similar calls. In this case, where countries no longer accept your word with a form of currency that can't be created from a printing press, we have a serious problem short of bombs bursting in the air. All the good money is gone, Gresham's law, and bad continues to take it's place. OUr credit is no good and they do not want in return worthless paper. So while the Fed can print from here to tomorrow and government continue to spend, there is nothing left of substance to expand and less and less people want it.

Aristotle “In the transition from an oligarchy or a tyranny to a democracy…persons refuse to fulfill their contracts or any other obligations, on the ground that the tyrant, and not the state, contracted them”

Your operating view of the world "we need more debt" and we need continued expansion is diametrically opposed to the reason I am in the metals. Debt is unsustainable when the borrower continues to ignore it's agreement and lenders no longer are willing to do business. Or lenders come knocking at your door with superior force. Which they will continue to. And what good is expanding our debt when countries such as Argentina has outlawed it?

Ivars put together a very nice economic model of expansion and why it is unsustainable a few blogs back. I put together an argument why historically expansion, the type you would like to see was the number 1 cause for the decline of every great civilization. Rome debased their currency, exhausted their resources, taxed the people and ruled with an Iron fist until no wealthy class existed and the state survived off the back of the poor working class and slaves. Lowered GDP. Currency debasement all caused by unsustainable expansion.


I'd agree that Peter Schiff calling for austerity measures won't sit well with most America and will never see the light of day unless we give over our entire economic sovereignty to the IMF. However, the reason is I want my streets cleaned and plowed, parks and beaches open and I don't want to deal with mobs of angry citizens looting. In other words, I don't want to look at the reality which we as a nation have created an unsustainable way of life. I would bet nobody here wants to meet that reality but from what I can tell most people are preparing in someway for that reality.

Peak Oil is not exempt from this argument either. For if SRSrocco knows that there is no more easy oil to come out of the ground so does the elite. And they will continue to extend their line of credit by debasing the currency to ensure that our military is in any part of the world where there is still easy grab resources until that runs out.

AlexCojones
Jan 27, 2013 - 6:41pm

The Latest Greatest from USMC Gordon Duff

Not sure if many are familiar with this USMC veteran but he channels his inner Founding Father firebrand/ patriot, Sam Adams, with some of his writings.

Fighting Back Indeed!

Gordon Duff: America after Sandy Hook, Disarmed and Silenced »

Xeno
Jan 27, 2013 - 6:43pm

Spoof

Pining, I first heard about "spoof" orders just a few years ago. The following is from a ZH article in 2010 when HSBC and JPM were facing charges of manipulation. 2010? Geeze has it been that long already and business as usual since? gawd awful performance by CFTC and a waste of tax dollars is all I can say.

  • Defendants or others have made large "spoof" orders which appeared on the trading screens; "spoofing" is the submission of a large order which is not executed but influences prices and is then withdrawn before it reasonably can be executed.

https://www.zerohedge.com/article/jpm-hsbc-sued-conspiracy-keep-silver-p...

From Karankawa @ https://www.tfmetalsreport.com/comment/163340#comment-163340
On one hand I see total control of the paper markets forever ...
On the other, this might be the paper elephant in the living room parading too close to a candle.

From my POV the paper elephant bumped the candle in 2001, knocked it over in 2003, and sat on it in 2007. The smell of paper burning has not let up since.

Xeno
Jan 27, 2013 - 6:56pm

Rough Week

Yeah, it'll probably be a rough week ahead with opex and fnd plus month end, not to mention all the games in D.C. and the so called courts, so who knows.

I just feel sorry for CalLawyer that the weekend highjacked his thread but it's been a darn good thread though.

GLTA

Bollocks
Jan 27, 2013 - 6:57pm

Jan 27, 2013 - 7:02pm

Steven B- wow

Truly great post- thank you!

I remember reading it originally, but just wasn't quite sure of its significance. After going through the complaint, I understand better now what you were trying to say back then. It also sounds like you have been on the receiving end of these a time or 2...maybe you can join the plaintiffs!

edit- Xeno! Just saw your post- it seems the different ways they have to screw with price are nearly endless. I cannot tell you how badly I hope for discovery to be granted in this case... Long shot, but I'm an optimist!

steveo
Jan 27, 2013 - 7:10pm

Took a few hours to create

Took a few hours to create this chart of Electricity use per person in the USA, since 1973, I think it speaks volumes. "They" Probably don't even see a need to fudge this data, unlike a "corrected" inflation or unemployment report.

https://oahutrading.blogspot.com/2013/01/electricity-data-from-us- energy.html

¤
Jan 27, 2013 - 7:13pm

Worth watching

Yen Will the JPY keep 91? Yep, headed towards 100 ( Check the 5 day chart )

Euro Did the Euro bounce off 1.35 or is it headed towards 140+? Yep. (ditto 5 day)

U.S. 10yr Will it reverse quickly from hitting 2.00? Friday was very uncharacteristic of the range it's been in. The USDX I believe will get short term incrementally stronger as will gold. (ditto)

Texas Sandman
Jan 27, 2013 - 7:14pm

I know where those bank deposits are going...

I've kept $1K in cash around my place in case of disaster... That would be bank closures, ATMs no longer spitting out bills, debit/credit cards not working.

I just pulled it out of the cupboard & deposited it to checking.

And I ordered another tube of ASEs. I'll wire out of the account when that money hits tomorrow to pay up. I think in terms of what's most likely coming that tube of ASEs will be more useful.

This is the 2013 equivalent of stuffing money in mattresses. And I think it's smart.

JMHO.

Urban Roman
Jan 27, 2013 - 7:19pm

This just in from ZH ... regarding Anonymous

Anonymous Lays Easter Egg In US Sentencing Commission's Website

Go to ussc.gov...

hit: UP, UP, DOWN, DOWN, LEFT, RIGHT, LEFT, RIGHT, B,A [ENTER]

Have fun

[edit]
Most of ZH seems to agree that it's BS. ..

¤
Jan 27, 2013 - 7:21pm

History rhymes, sometimes stutters

Egypt Faces 'Arab Spring II' As Morsy Imposes 30-Day Curfew

Submitted by Tyler Durden on 01/27/2013 - 19:03

Egypt appears to be coming unhinged once again. Egyptian President Mohamed Morsy has imposed a 30-day curfew (from 9pm to 6am) on several of the nation's largest cities as tensions rise from several perspectives. The most glaring 'flare' in riots is due to the death-sentences handed out this week to 21 people involved in a Port Said soccer riot - where fans bashed each other with rocks and chairs) about a year ago (where 73 people died and more than 1000 were injured). CNN reports that there are 38 deaths and 415 injuries so far in Port Said - and so the 'Morsy Moment' has occurred imposing curfews. However, while 'blame' has been apportioned to a population started by relatives of the sentenced, it seems there is more at the core of this as clashes between anti-government protesters and security forces enter their third day near Cairo's infamous Tahrir Square. The former Muslim Brotherhood leader, who became Egypt's first democratically elected leader last year, has come under fire by some who compared him to Mubarak and said he has amassed power for himself and his Islamist allies. The protests in Cairo, Alexandria, Suez and elsewhere in recent days have focused their anger at Morsy.

https://www.zerohedge.com/

Egypt Gripped by Turmoil, Deadly Rioting
¤
Jan 27, 2013 - 7:25pm

Raw

Life unfiltered...

Video unavailable

A blaze raced through a crowded nightclub in southern Brazil early Sunday, killing 232 people as the air filled with deadly smoke and panicked party-goers stampeded toward the exits, police and witnesses said. (Jan. 27)

Pick 52
Jan 27, 2013 - 7:29pm
Texas Sandman Ircsum
Jan 27, 2013 - 7:34pm

Iresum

I very much disagree with your analysis. First February is the second strongest month of the year for seasonality sporting an average 5+% return over the past 12 years. Chinese New Year is coming soon.

Second, I see the longer term charts somewhat differently.

I see a breakout from a huge bullish flag going back to April 2011, a retrace to the point of breakout (which almost coincided with the 200 day MA), which is absolutely normal, even expected technically, followed by the very beginning of an apparent continuation move higher.

That's the very big picture thing here. As I've said in prior posts, this viewpoint is an even coarser grained view than my simple approach to trading (based on the seasonality referenced above with the trend of a single MACD indicator), but your viewpoint is absolutely at odds with reality here. Chief executive turd ferguson is most likely correct we're seeing options expiration / delivery notice inspired shenanigans by the EE here. There is nothing bearish in any way about the technical picture here.

¤
Jan 27, 2013 - 7:37pm

PM related

How the Earth Was Made: Americas Gold

Gold-quartz vein

Video unavailable

Paradise found? (yes, that is gold!) above and below

Blue Ribbon Mine, Alaska

Strongsidejedi Urban Roman
Jan 27, 2013 - 7:44pm

Thank you to Urban Roman

Urban Roman - many thanks for posting the instructions for that Easter Egg!

That game is very enjoyable to play and many LULZ!

kubla khan
Jan 27, 2013 - 8:16pm

Martin Armstrong

Just listened to Jim Puplava here and near the end a guest calls in asking Jim's opinion on Armstrong's call of metals taking off in the Spring of 2013 referencing Armstrong making this statement in the past when he was a guest on the show. Jim states that he agrees with the call. So I'm curious if Armstrong is bearish all of a sudden as he has been referencing this spring for quite a while as a move up in pm's.

https://www.financialsense.com/financial-sense-newshour/2013/01/26/big-p...

Byzantium
Jan 27, 2013 - 8:26pm

@ TexasSandman

That's a great chart that you posted, and I hope that you are right in your bullish assessment.

75% of my own trading funds are positioned accordingly on the long side.

All the same, I think that each of the three resistance levels will be more vigorously defended than the last (and with traders cashing in and taking profits along the way, taking money off the table & joining the shorts, as we go higher). And yet, we have failed so far even to punch through the first & easiest resistance level, in spite of the chatter around shortage of physical.

Among those cashing in some of their positions as we break through resistance levels, will be me.

I am waiting for the game-changer. All the pm friendly news that we have had so far, is almost everything on a goldbug's wish-list (ZIRP, QE, phys shortages, CB buying etc), but has proven woefully inadequate. I wonder what it is going to take?

Nonetheless, great chart, thank you.

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