REVERSE RAID ON THE CRIMEX - Silver Targets $37 OZ

[JohnQPublic]

REVERSE RAID ON THE CRIMEX - Silver Targets $37 OZ (http://goldharvest.blogspot.com/2011/02/reverse-raid-on-crimex-silver-targets.html)
Posted by greg maurer at 2/22/2011 07:50:00 AM

Interesting synopsis of the current run up.

[Neuro]

Fascinating! However, somehow I get the feeling, that TPTB may be playing both sides of the equation on this. After the long raiders have gotten what they want we may see a deeeep plunge, to satisfy the shorts, and let them recoup their losses, otherwise we may see a group of Hedge fund managers and billionaires suddenly suicided in near future...

[JohnQPublic]

Yes, there are two sides to every coin. Still long term I am not concerned. The next couple weeks woll be very interesting if nothing else!

[Neuro]

Yes, there are two sides to every coin. Still long term I am not concerned. The next couple weeks woll be very interesting if nothing else!
Yes no matter if this group Friends Of Andrew McGuire (FOAM) is for real, controlled opposition, or a figment of imagination, it's existence is just a symptom of the real problems that exist in the silver market...

[solid]

Yes, there are two sides to every coin. Still long term I am not concerned. The next couple weeks woll be very interesting if nothing else!
Yes no matter if this group Friends Of Andrew McGuire (FOAM) is for real, controlled opposition, or a figment of imagination, it's existence is just a symptom of the real problems that exist in the silver market...


Right, maybe a lot of this article went right over my head..but fascinating for sure. Wouldn't FOAM's plan be a modern day version of the Hunt brothers though?

[osoab]

http://www.youtube.com/watch?v=Lq0bAOVaQwQ&feature=player_embedded

[Libertarian_Guard]

As the December 2010 COMEX silver contracts approached maturity, a higher than normal number of contracts were not closed out before the first day of notice for delivery. In theory, potentially all of these open contracts could have ended up being called for delivery. While a number of short sellers absorbed their losses by purchasing an offsetting long contract, the amount of silver that was needed for physical delivery did stress available COMEX inventories.

As a result, in November and December 2010 the price of silver jumped more than 30%.

This same pattern looks like it will repeat for the maturing March 2011 COMEX silver contracts. This time, however, the potential supply squeeze is much larger.

February 28 is the first day of notice for delivery of the March contracts. Normally, parties not wanting delivery would have closed out their contract long before then. At the COMEX close on February 22, there were still 50,848 open March 2011 silver contracts, representing a potential liability to deliver 254.24 million ounces of silver by the end of March. The COMEX registered silver inventories available to cover deliveries totaled only 41.91 million ounces. Even including customer inventories that are stored at the COMEX, which are only eligible to deliver against COMEX contracts if the owners so choose (and most do not), the total is only 102.35 million ounces.

During COMEX trading hours on February 22, there were 124,000 March 2011 silver contracts traded—almost 2-1/2 times the number of open contracts! This is almost unprecedented volatility!

Here’s what I suspect happened to cause such a huge trading volume that day. The price of silver had been rising significantly for the past several trading days, reaching successive 31-year high price records (ignoring inflation). The US markets were closed on February 21 for Presidents’ Day. In trading in Asian and European markets early on February 22, the price of silver passed $34.00. If this price were maintained, then a large number of short sellers would get margin calls when the COMEX market opened on February 22. That could have forced leveraged short sellers to put up additional cash, physical silver, or to buy long contracts to close out their short positions. Any of these actions would likely have the effect of pushing silver prices up even higher.

It appears that a massive effort was mounted to drive drown COMEX silver prices on February 22 in order to avoid or reduce the margin calls to leveraged short sellers. This strategy was successful to a degree in that the price of silver dropped to just below $33.00 at one point on the COMEX. The temporary drop encouraged some owners of long positions to liquidate and take profits, further helping to push the price down.

However, the price suppression effort was not successful at pushing down the silver price below the February 18 COMEX close. Once it became clear that the manipulation was losing steam, buyers jumped back into the market on February 23. During COMEX trading hours, the price of silver reached as high as $33.75. Trading was extremely volatile, with 1% swings up and down occurring within a matter of minutes.

Several hedge funds, seeing how easy it was to make a short-term profit in silver squeezing COMEX short sellers last November and December, are likely to repeat the tactic with the maturing March contracts—but on a greater scale.

If the price of silver from now through the end of March were to rise by 30% again, that would put the price around $43. But, if there is a larger supply squeeze underway, the price could go much higher.

Already we are seeing several physical silver wholesalers using a two-tier silver spot price system. If you want to sell to them, they are using spot prices derived from COMEX and other markets. On the other side, if you wish to purchase physical metals from them, they are quoting a selling spot price that is 5-10 cents higher than their buying spot price.

The mainstream media is reporting that stock market prices and most commodities (with the exception of gold) fell on February 22 as a result of concerns about unrest in countries in the Middle East and North Africa that could lead to reduced supplies of petroleum. The unrest is sparked in part by soaring food prices (which the US government pretends is not occurring) in addition to political factors. But this news does not give you a clear picture of what is really going on in the silver (and gold) markets.

Expect both gold and silver prices to become much more volatile in the coming weeks. Don’t be surprised if silver prices move across a $2-3 range within a 24-hour period. In the past week, our company has enjoyed a significant increase in demand for physical silver. Thus far we have been able to make immediate or short-term delivery of most forms of silver. That could change quickly. At last report, the Perth Mint was telling buyers that they would have to wait until at least April to receive delivery of newly manufactured silver ingots.

Even though silver prices are now near 31-year highs and gold is near its highest prices ever, I still consider both of them to be at bargain levels compared to what I expect to see by the end of March. Silver will outperform gold, but both will do well versus the US dollar and all currencies.

http://news.coinupdate.com/huge-comex-silver-supply-squeeze-developing-0695/

[gunDriller]

Fascinating! However, somehow I get the feeling, that TPTB may be playing both sides of the equation on this. After the long raiders have gotten what they want we may see a deeeep plunge, to satisfy the shorts, and let them recoup their losses, otherwise we may see a group of Hedge fund managers and billionaires suddenly suicided in near future...


in 2008 when oil went to $147, i'd say about 1/3 of that was speculation. the economy was tanking, banks were crashing, people were worried - and the oil price zooms.

so i would expect similar manipulation in the PM markets, though in addition to their other dollar pimping activities.

[osoab]

Wynter_Benton update on their recent raid (http://screwtapefiles.blogspot.com/2011/03/wynterbenton-update-on-their-recent.html)


Wednesday, March 2, 2011
Wynter_Benton update on their recent raid
With permission, I can update the results of our raid. It was successful beyond imagination but that "success" has spawned even more questions about the price of paper silver going forward. It was reported by SGS that he heard that on Friday Blythe was offering 30-50 percent premium and that at least 4500 hundred contracts will stand for delivery. I am here to give you a more accurate update (and a first hand account of what happened on Friday Feb 25). Our group was detemined to stand for delivery going into Monday because we were not going to take a 30 percent premium on a price of $33.50. It was reported that Blythe offered 50 percent premium. That was not even close in our case. We got over 80 percent premium. That's right. Over $50 per contract on the condition that our group sell all our contracts. Our counterparty even threatened us with the ghost of Herstatt (http://www.businessdictionary.com/definition/Herstatt-risk.html). They openly admitted that they could not deliver even 20 million ounces to us but that if we stood for delivery they would be sure that they make delivery to everyone else before they defaulted on us which would make us 'unsecured creditors'. They told us directly that they could not allow even 5000 contracts to stand for delivery because they could not deliver a mere 20 million ounces. Like Vito Corleone said, "I'm gonna make him an offer he can't refuse." And indeed we did not refuse as this was our intention all along.

These sets of facts from our traders lead us to believe that the paper price of silver may have a difficult time surpassing $36 because if the counterparty at the Comex is so willing to pay north of $50 to dissuade people from standing for delivery yet the paper price of silver is still under $35, then we suspect that losses triggered by derivatives is the main reason for the price suppression of silver. We can see no reason why they would not allow the paper price to go up yet are so glad to pay off the comex contracts to show the world that so few are standing for delivery. In our mind, Comex could default with if as little as 4,000 contracts stood for delivery. We are very curious to see how high the paper price of silver actually trades during this run.

I added the link to Herstatt. I had never heard of that before.

FWIW, Bob Chapman was saying something along the lines of Comex paying 50% above spot in one of his weekly interviews. He didn't go into a lot of detail. I don't know if he ever revisited the subject. 80% premium would be a nice payoff.

[bellevuebully]

80% premium would be a nice payoff.




Ya, on an investment that is already leveraged 20:1. Not bad at all.

Initial margin on Comex 5000 oz around $6800, so leverage is approx. 20:1.....

Bought contract at $30. Contract value is $150k. Invest (margin) approximately $7000.

Silver rises to $34. Contract value is $170k. Net gain of $20k at 80% premium is $36k.

515% gain on investment.......not too shabby at all. Even in fiat. ;D

[PatColo]

Physical Silver is Really $50 per Ounce (80% Premium on COMEX Silver Non-Delivery)
http://beforeitsnews.com/story/462/380/Physical_Silver_is_Really_50_per_Ounce_80_Premium_ on_COMEX_Silver_Non-Delivery.html

just a tease there, more at http://harveyorgan.blogspot.com/

[JohnQPublic]

It's really more like $42- 20% prem. on PSLV

[DMac]

http://www.youtube.com/watch?v=Et02g9OQ-LM

[Neuro]

I doubt they were given an 80% premium, not to take delivery... Makes Friends Of Andrew McGuire look more like the figment of imagination to me...

[Uncle Salty]

If the Silver contracts are being paid premiums and the cash out value is about $50, think about the backwardation that that represents!!

Staggering.

[Neuro]

If the Silver contracts are being paid premiums and the cash out value is about $50, think about the backwardation that that represents!!

Staggering.
I would consider it if 1000 oz bars also had huge premiums, they don't!

[Uncle Salty]

If the Silver contracts are being paid premiums and the cash out value is about $50, think about the backwardation that that represents!!

Staggering.
I would consider it if 1000 oz bars also had huge premiums, they don't!


Not yet, but if it's true that huge premiums are being paid for cash settlements, the end of the game is much closer than it has ever been.

[Trinity]

I'm still not buying the story that paper Silver longs are getting paid big premiums to accept cash settlement. I would love for it to be true but I still have not seen it reported by an outside source.

[PatColo]

I'm still not buying the story that paper Silver longs are getting paid big premiums to accept cash settlement. I would love for it to be true but I still have not seen it reported by an outside source.


If by "outside source" you mean by "a proper zio-MSM organ", they tend to report on these financial shenanigans a little behind the curve.

March 2, 2011, 7:40 pm
A Conspiracy With a Silver Lining (http://opinionator.blogs.nytimes.com/2011/03/02/a-conspiracy-with-a-silver-lining/?hp)
By WILLIAM D. COHAN

[PatColo]

Physical Silver is Really $50 per Ounce (80% Premium on COMEX Silver Non-Delivery)
http://beforeitsnews.com/story/462/380/Physical_Silver_is_Really_50_per_Ounce_80_Premium_ on_COMEX_Silver_Non-Delivery.html

just a tease there, more at http://harveyorgan.blogspot.com/



http://harveyorgan.blogspot.com is a key source following this issue. Today he posts (the strange paragraph breaks appear at his blog, I aint gonna fixem!):

Tuesday, March 8, 2011
Cash balances decline rapidly at the Fed/silver and gold hold steady
Good evening Ladies and Gentlemen:

Before commencing with my commentary, I wrote to all the commissioners at the CFTC
on the huge increase in the net short position by JPMorgan.

Here is the complaint sent down and I invite your comments:


Dear Chairman Gensler and fellow Commissioners:

Friday night saw the release of two very important reports on silver. The first report at 3:30 pm was the release of the COT report whereby the net increase in the short positions by the commercial bankers in silver increased

by a rather large 3000 contracts. Also, 1 1/2 hours later, we got the banking participation report for February whereby J.P.Morgan who holds the dominant short positions here, increased their net short position from 19,000 contracts to

25,000 contracts. Over the past several weeks, JPMorgan has steadily reduced their short positions by a rather large 11,000 contracts. This was probably due to the Commission's urging, kind of like moral suasion. Three months ago, JPMorgan had a net short

position of around 30,000 contracts. The fact that this bank has a huge short position lends credence to its constant manipulation on the silver market, a fact that we have brought to your attention many times over the past several years.

The new net short position of 25,000 contracts represents 125 million oz. of silver. Global production of silver including China is around 700 million oz. Thus 17.8% of global production is concentrated with JPMorgan on the short side. How on earth could you allow this

to happen?

You must be concerned as to the reason why JPMorgan has decided to increase its net short position by a further 30%. Ted Butler hypothesizes that this may be by a rogue trader who "went on his own" instead of the wishes of JPMorgan itself.

This must be examined closely and reported to all of us. The fact that the largest concentrated position in silver (on the short side) added another huge position should have thrown red flags all over the place.

It has been 2 and 1/2 years since the investigation into the silver manipulation began. We have asked one simple question with subsets that has yet to be answered:

In 2008, JPMorgan held a short concentrated position of 25% of global production in silver. How is this not manipulative? If not manipulative, then why? Are the actions of JPMorgan on their massive short position legal or illegal?

How is this massive short position in line with your published guidelines?

Today, JPMorgan has a short concentrated position of 17.8% of global production. Again, how is this not manipulative on pricing?

I know you have asked the public for their comments and from what I gather, a huge number of concerned investors have placed their comments with you over these past two months. Obviously, the will of the people must be addressed here and preserve the sanctity

of the markets.

I hope that you will look into this matter immediately and report your findings to all.

Sincerely,

Harvey B Organ BScPhm MBA

[osoab]

I wonder if the increase in shorts is a maneuver to make short term profit to cover losses on the out of the money short contracts they own. With silver on it's current run up, a short term pull back would be "healthy".

Granted, we are talking about the Morgue. It's just a thought that popped into my noggin.

[Uncle Salty]

I'm still not buying the story that paper Silver longs are getting paid big premiums to accept cash settlement. I would love for it to be true but I still have not seen it reported by an outside source.


The gold and silver manipulation is the biggest fraud in the world. It basically props us the US dollar and its empire.

They will hide the truth at any cost.

[Neuro]

I'm still not buying the story that paper Silver longs are getting paid big premiums to accept cash settlement. I would love for it to be true but I still have not seen it reported by an outside source.


If by "outside source" you mean by "a proper zio-MSM organ", they tend to report on these financial shenanigans a little behind the curve.

March 2, 2011, 7:40 pm
A Conspiracy With a Silver Lining (http://opinionator.blogs.nytimes.com/2011/03/02/a-conspiracy-with-a-silver-lining/?hp)
By WILLIAM D. COHAN
Agreed, but so far we have only seen it reported as an assertion of a person, that we even don't know is real. It could very well just be a lie, from the bankers themselves, or someone who likes to kid around. I would think if there is such a shortage of 1000 oz good delivery bars, we would also see a gigantic premium on them...

[PatColo]

Agreed, but so far we have only seen it reported as an assertion of a person, that we even don't know is real. It could very well just be a lie, from the bankers themselves, or someone who likes to kid around. I would think if there is such a shortage of 1000 oz good delivery bars, we would also see a gigantic premium on them...


a healthy skepticism, I like it! 8)

We need a trusted source to verify. Someone to attempt to take delivery on a 5K-oz silver contract. I play craps in the futures here & there with a "casino money" futures account, but I'm in no position in the near term to do the hoops necessary to test this big-premiums-paid-on-cash-settlements allegation. May-11 is the next contract month where one could reasonably test this issue, by going long a May-delivery silver contract between now and late April. Anyone? Bueller?

To get further conspiratorial, there's the "secret society connection" problem of whether, say a small fry shows up to take delivery on 1-2 standard 5K-oz contracts, but they don't give the right handshake or nose-scratch etc, COMEX could just give said small fry their silver bricks and trust small fry will go back to all the messageboards and report there's no apparent inventory issues. But a bigger fry, and/or one who properly demonstrates they're "in the lucie club", they may take aside and cut a settlement check with a big premium on top-- and thus maintain the inventory charade while keeping joe public in the dark.

I know it's wild conspiratorial speculation, but as Uncle Salty said, they will hide the truth at any cost, to keep the FRN CONfidence game going, and/or the paper-vs-physical silver charade concealed. It's like if the dark suspicions about the PM ETFs (http://solari.com/archive/Precious_Metals_Puzzle_Palace/) were true, that would be a pretty elaborate "conspiratorial plot" which would indeed have been so far successful in sponging up billions in fiat which may otherwise be spent on real physical silver, by tricking investors who believe they're in "physical silver", but who are not..

[DMac]

I think the delivery months are March, May, July, September, and December - FWIW, those are the months for any possible CRIMEX shenanigans.

[Neuro]

Of course it could very well be true, this group of hedge fund managers and ex JPM traders could have been given a huge premium for their contracts, not to take delivery. But one issue is, how would these huge cash premiums, be filed in the books by the accountants, who payed them off? Just JPM? Or did COMEX pay them off, with what money? Or was it the cartel of shorts that decided to pay them off solidarically, according to the amount they were short. Or Is this just a ploy to get a lot of hopeful bagholders in at a high price, before the price of silver is plunged to the low 20's. As PatColo said, they will probably be able to find the silver for you to pay off a small very persistent guy who wants delivery of 5-10 k oz, and is prepared to wait a few months, but if you are waiting for the delivery of let's say 2000 contracts amounting to 10 million oz of silver, which is not possible to get they may want to offer you a substantial settlement not to be called on the bluff. But why in the world would JPM INCREASE their short position from 19 to 25 million oz in such a situation? They know that the group they payed off, could fo the same trick again, without any risk, in lieu of that why even go more on the short side?

[Trinity]

Good posts guys. My suspicion is news like this gets futures/options traders piling in on paper longs then impatient as they are for profits they sell out and short players make a profit on them. Of course physical buyers sticking to the buy and hold strategy do not get hurt so no biggie for us.

[PatColo]

getting closer to that "notice of delivery" date for the May-delivery silver contracts.
First Notice Day: Last business day of month preceding contract month.

this recent King World News guest is beating the drum for imminent silver delivery problems,
Rick Rule - Extreme Silver Tightness Causing Delivery Problems (http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/4/15_Rick_Rule_-_Extreme_Silver_Tightness_Causing_Delivery_Problem s.html)
audio inside

[osoab]

Latest message from Wynter Benton on the yahoo boards.

http://messages.finance.yahoo.com/Business_%26_Finance/Investments/Stocks_%28A_to_Z%29/Stocks_J/threadview?bn=10073&tid=401099&mid=401099



Message to Jes Staley

Libenter homines id quod volunt credunt - (Caesar)

The Leader expects your answer promptly or it will be thermonuclear within a fortnight. Ask Ken Lewis if he has this understanding!!!

You're going home in a body bag do da, do da.......
Weird message. This was posted on August 7. The fortnight has passed.

The translation from Latin.


men generally believe what they want to

People's beliefs are shaped largely by their desires. Julius Caesar (http://en.wikipedia.org/wiki/Julius_Caesar), The Gallic War (http://en.wikipedia.org/wiki/Commentarii_de_Bello_Gallico) 3.18 (http://en.wikisource.org/wiki/la:Commentarii_de_bello_Gallico/Liber_III#18)

[Plastic]

Very Weird, almost drunk/"medicated" weird...

[Large Sarge]

what about the big movement today in J.P. Morgan vaults?

that happened within the time frame....

and my guess is that if you are going to have to deliver, under COMEX rules, the metal must be in a certain category, so many days preceding the delivery month...

Hence the unprecedented movement by J. P. Morgan on the last day.... (just speculating here)

[Bigjon]

Agreed, but so far we have only seen it reported as an assertion of a person, that we even don't know is real. It could very well just be a lie, from the bankers themselves, or someone who likes to kid around. I would think if there is such a shortage of 1000 oz good delivery bars, we would also see a gigantic premium on them...

I posted something a while back that quoted Jim Willy saying that they were paying off a premium to take cash instead of silver.

[Bigjon]

http://news.goldseek.com/GoldenJackass/1265295600.php

Posted Thursday, 4 February 2010 | Digg This Article | Share this article | Source:
GoldSeek.com


A great disconnect exists in the gold market between the exchange futures contract price (the paper price) and the gold bullion paid price for transactions (the physical price). The differential in price is growing wider, enough to place tremendous pressure on the gold market itself. Look not to the gold premium paid for purchases, but to high volume purchases in the tens of million$. In mid-December, almost every demand for gold contract delivery was matched by a cash delivery, complete with 25% bonus premium offered. The officials even produced a new ledger item called 'Cash For Delivery' that was necessary to balance their badgered books. It prompted little attention. Some call it a basic bribe. Others call it a technical default.

If they did it for the gold market what is to stop them doing it for silver?

Breakdown Of The Gold Market - The Market Oracle - Financial

In mid-December, almost every demand for gold contract delivery was matched by a cash delivery, complete with 25% bonus premium offered.

www.marketoracle.co.uk/Article16987.html - Proxy - Highlight
Breakdown in the Gold Market

In mid-December, almost every demand for gold contract delivery was matched by a cash delivery, complete with 25% bonus premium offered.

news.goldseek.com/GoldenJackass/1265295600.php - Proxy - Highlight
The Silver Bear Cafe

In mid-December, almost every demand for gold contract delivery was matched by a cash delivery, complete with 25% bonus premium offered.

www.silverbearcafe.com/private/02.10/breakdown.html - Proxy - Highlight
Gold Market Watch

In mid-December, almost every demand for gold contract delivery was matched by a cash delivery, complete with 25% bonus premium offered.

goldmarketwatch.blogspot.com - Proxy - Highlight
Breakdown Of The Gold Market

Golden Jackass website subscribe: Hat Trick Letter Jim Willie CB is the editor of the "HAT TRICK LETTER".

www.gold-eagle.com/editorials_08/willie020410.html - Proxy - Highlight

[osoab]

Updating the thread with the latest Wynter Benton rumor.

http://messages.finance.yahoo.com/Business_%26_Finance/Investments/Stocks_%28A_to_Z%29/Stocks_J/threadview?bn=10073&tid=402940&mid=402940


Silver will soon be a reserve asset for a sovereign central bank 25-Aug-11 10:25 am

The Leader wishes to inform his readers that a sovereign central bank will soon announce that it is accumulating silver as a reserve asset.

Also he is advising those who have participated so successfully in the latest gold run to shift their entire focus to the silver market.

As to Jes Staley, The Leader will give his reply at the appropriate moment.

You're going home in a body bag, do da, do da.....

This last part was in the post from Aug 7. Who is Jes Staley?

[osoab]

http://news.goldseek.com/GoldenJackass/1265295600.php

Posted Thursday, 4 February 2010 | Digg This Article | Share this article | Source:
GoldSeek.com


A great disconnect exists in the gold market between the exchange futures contract price (the paper price) and the gold bullion paid price for transactions (the physical price). The differential in price is growing wider, enough to place tremendous pressure on the gold market itself. Look not to the gold premium paid for purchases, but to high volume purchases in the tens of million$. In mid-December, almost every demand for gold contract delivery was matched by a cash delivery, complete with 25% bonus premium offered. The officials even produced a new ledger item called 'Cash For Delivery' that was necessary to balance their badgered books. It prompted little attention. Some call it a basic bribe. Others call it a technical default.

If they did it for the gold market what is to stop them doing it for silver?

Breakdown Of The Gold Market - The Market Oracle - Financial

In mid-December, almost every demand for gold contract delivery was matched by a cash delivery, complete with 25% bonus premium offered.

www.marketoracle.co.uk/Article16987.html - Proxy - Highlight
Breakdown in the Gold Market

In mid-December, almost every demand for gold contract delivery was matched by a cash delivery, complete with 25% bonus premium offered.

news.goldseek.com/GoldenJackass/1265295600.php - Proxy - Highlight
The Silver Bear Cafe

In mid-December, almost every demand for gold contract delivery was matched by a cash delivery, complete with 25% bonus premium offered.

www.silverbearcafe.com/private/02.10/breakdown.html - Proxy - Highlight
Gold Market Watch

In mid-December, almost every demand for gold contract delivery was matched by a cash delivery, complete with 25% bonus premium offered.

goldmarketwatch.blogspot.com - Proxy - Highlight
Breakdown Of The Gold Market

Golden Jackass website subscribe: Hat Trick Letter Jim Willie CB is the editor of the "HAT TRICK LETTER".

www.gold-eagle.com/editorials_08/willie020410.html - Proxy - Highlight


Looks like they are all posting a Jim Willie piece.

[Bigjon]

I just copied my results from the search engine. Never looked at them.