http://jessescrossroadscafe.blogspot.com/2010/03/bombshell-whistleb...

Do we have another Harry Markopolos here, describing in detail the manipulation of the silver markets by J.P. Morgan to the CFTC? How does
this square with the testimony today from the CFTC Commissioners, who
seem to indicate that the markets are functioning extremely well, and
that investor can have full confidence in them?

I am led to understand that Mr. McGuire had offered to testify before the CFTC
today, and that he was refused admittance. I do not know him, or the
position he is in within the trading community. I cannot therefore
assess his credibility or the validity of any evidence which he may
present or possess. But I have the feeling that nothing will come of
this.

Remember, there was no action on the Madoff scandal until AFTER his fraud collapsed, and the government was forced to acknowledge
Markopolos' existence. He had been ignored and dismissed by the
bureaucrats at the SEC for years because of Madoff's power and standing
with the trading establishment. And of course by those who had an
interest in hiding Madoff's scheme, if nothing else, to promote
'confidence' in the markets.

What seems particularly twisted about this is that JPM is the custodian of the largest silver ETF (SLV). Is anyone auditing that ETF, and
watching any conflicts of interest and self-trading? Multiple
counterparty claims on the same bullion?

If you ever wanted to see a good reason for the Volcker rule, this is it. These jokers are
one of the US' largest banks, with trillions of dollars in unaudited
derivatives exposure, and they seem to be engaging in trading practices
like Enron did before it collapsed.

Have they lost their minds, or are they just that reckless, immature, short term, and
arrogant? Morgan practically holds the keys to the US Treasury, a
recent recipient of billions in taxpayer support, and still receiving
signficant subsidies from the Fed. They seem to be in dire need of
adult supervision. Blatantly and clumsily rigging the silver market,
and then bragging about it to people outside their company. What's
next, bumping off grannies for their Social Security checks? Three card
monte games on the boardwalk?

I was trying to understand why this item struck me so hard this evening. It shocked me in a way that
few things do anymore. I think it is because I had unconsciously come
to the same conclusion earlier, on my own, in the post where I showed
the repeated and obvious bear raids on gold into this option
expiration, and it struck a resonant chord when I read McGuire's
description of the silver manipulation. I refused to believe it, but
apparently there it is. The "Dr. Evil" trading strategy that Citigroup was caught using in the Eurobond markets.

I do not expect the detailed facts on this to ever reach the light of day
in my lifetime. The implications are far too political.

ADDITIONAL STATEMENT BY BILL MURPHY, CHAIRMAN OF THE GOLD ANTI-TRUST ACTION COMMITTEE

HEARINGS ON THE METALS MARKETS, MARCH 25, 2010

On March 23, 2010 GATA Director Adrian Douglas was contacted by a whistleblower by the name of Andrew Maguire. Mr. Maguire, formerly of
Goldman Sachs, is a metals trader in London. He has been told first
hand by traders working for JPMorganChase that JPMorganChase
manipulates the precious metals markets and they bragged how they make
money doing so.

In November 2009 he contacted the CFTC enforcement division to report this criminal activity. He described in
detail the way in which JPM signals to the market its intention to take
down the precious metals<. Traders recognize these signals and make
money shorting the metals along side JPM. He explained how there are routine market manipulations at the time of option expiry, Non-farm payroll data releases, and Comex contract rollover as well as other ad hoc events.

On February 3 he gave two days advance warning by email to Mr Eliud
Ramirez, a senior investigator of the Enforcement Division, that the
precious metals would be attacked upon the release of the non-farm
payroll data on February 5. Then on February 5 as it played out
exactly as predicted further emails were sent to Mr. Ramirez in real
time while the manipulation was in progress.

It would not be possible to predict such a market move in advance unless the market was manipulated.

In an email on that day Mr. Maguire said "It is 'common knowledge' here in
London amongst the metals traders it is JPM's intent to flush out and
cover as many shorts as possible prior to any discussion in March about
position limits. I feel sorry for all those not in this loop. A serious
amount of money was made and lost today and in my opinion as a result
of the CFTC allowing by your own definition an illegal concentrated and
manipulative position to continue"

Expiry of the COMEX APRIL call options is today. There was large open interest in strikes from
$1100 to $1150 in gold. As always happens month after month HSBC and
JPM sell short in large quantities to overwhelm all bids and make
unsuspecting option holders lose their money. As predicted in
advance by GATA the manipulation started on March 19th when gold was
trading at $1126. By last night it traded at $1085.

This is how much the gold cartel fears the enforcement division. They thumb their
noses at you because in over a decade of complaints and 18 months of a
silver market manipulation investigation nothing has been done to stop
them. And this is why JPM’s cocky and arrogant traders in London are
able to brag that they manipulate the market.

It is an outrage and we are making available the emails from our whistleblower,
Andrew Maguire available to the Press wherein he warns in advance of a
manipulative event.

Additionally Mr. Maguire informed us that he has taped recordings of his telephone communications with the
CFTC for which we are taking the appropriate legal steps to acquire.


I thought you might be interested in looking into the silver trading today. It was a good example of how a single seller, when they hold such a
concentrated position in the very small silver market, can instigate a
selloff at will.

(Note: This is the "Dr. Evil" trading strategy that got Citi rebuked and fined in the Euro Bond markets, and also got Enron into trouble in the energy markets. - Jesse)

These events trade to a regular pattern and we see orchestrated selling occur
100% of the time at options expiry, contract rollover, non-farm
payrolls (no matter if the news is bullish or bearish), and in a lesser
way at the daily silver fix. I have attached a small presentation to
illustrate some of these events. I have included gold, as the same
traders to a lesser extent hold a controlling position there too.... I
brought to your attention during our meeting how we traders look for
the "signals" they (JPMorgan) send just prior to a big move. I saw the
first signals early in Asia in thin volume. As traders we profited from
this information but that is not the point as I do not like to operate
in a rigged market and what is in reality a crime in progress.

As an example, if you look at the trades just before the pit open today
you will see around 1,500 contracts sell all at once where the bids
were tiny by comparison in the fives and tens. This has the immediate
effect of gaining $2,500 per contract on the short positions against
the long holders, who lost that in moments and likely were stopped out.
Perhaps look for yourselves into who was behind the trades at that time
and note that within that 10-minute period 2,800 contracts hit all the
bids to overcome them. This is hardly how a normal trader gets the best
price when selling a commodity. Note silver instigated a rapid move lower in both precious metals.

This kind of trading can occur only when a market is being controlled by a single trading entity.

I have a lot of captured data illustrating just about every price
takedown since JPMorgan took over the Bear Stearns short silver
position.

I am sure you are in a better position to look into the exact details.

It is my wish just to bring more information to your attention to assist you in putting a stop to this criminal activity.