Today, I will speak of a completely unprecedented situation that has evolved over the past seven years. I define “unprecedented” as something that was never done or known before. The unprecedented circumstance is my seven year documented history of labeling the giant financial institution, JPMorgan Chase, as being engaged in an illegal price manipulation of the silver market. To my knowledge, never has it occurred that open allegations of serious criminal wrongdoing have ever been made about any financial institution with those allegations going unchallenged. No one would dare label any large financial institution of being crooked and expect that institution to turn the other cheek.
Yet JPMorgan has remained silent in the face of what most would consider to be statements damaging to its reputation. It’s one thing to label a government agency or congress as being a bunch of crooks; in fact, it’s common practice by many. But calling a publicly owned bank crooked is very different. The government turns its back on critics but call a big bank crooked and expect to get your heart ripped out. Therein lies the mystery.
Why would JPMorgan allow allegations of serious wrongdoing to go unchallenged? It can’t be that the allegations aren’t serious enough, as price manipulation is the most serious market crime possible, damaging just about everyone, including the market itself. It can’t be because my allegations aren’t specific enough, as I’ve detailed what the bank has done in silver twice a week for seven years; down to the number of short COMEX silver contracts JPMorgan has held weekly. It can’t be because I am relying on false data to back up my allegations because I rely exclusively on government and exchange statistics. It can’t be that my market structure analysis is wrong, because it has now come to be more copied than any other approach. Then what the heck is preventing JPMorgan from denying that it is the crook I allege it to be?
One reason could be that it was unaware of the allegations. But in this case, not only have I written many public articles accusing JPMorgan as being the big market crook in silver, I have sent the bank all the articles in which I have used its name - many hundreds (over 700) of private articles in which the allegations were contained. This started in late 2008, when CFTC correspondence to legislators confirmed that JPMorgan had taken over the big COMEX silver and gold short futures positions of Bear Stearns and used those positions to continue to manipulate prices.
At that time I called the chairman’s office at JPMorgan and requested and was given two email addresses in which to direct any allegations to its CEO, Jamie Dimon and the board of directors. I have done so ever since and, perhaps to the bank’s credit, not one of the hundreds of articles I sent to those addresses were ever returned as undeliverable. I can’t swear anyone at the bank read any of these articles over the past seven years, but I can attest to them being sent and received.
A few years ago, I wrote by regular mail to each board director at the time, detailing specific allegations of price manipulation by the bank and began to send each director my articles by email as well. While the two email addresses given to me by the bank seven years ago still accept my articles to this day, my emails to the directors were quickly blocked, so I stopped sending my allegations to them. I found it interesting that the bank’s general counsel at the time, Stephen Cutler, followed the lead of the directors and also blocked my emails. I always thought the top lawyer at JPMorgan and the board directors might object to the bank being called crooked and demand that I cease doing so. That never occurred and I would also consider that to be unprecedented.
Therefore, I think we can eliminate JPMorgan being unaware of my allegations as the reason it has ignored them. Perhaps the reason has to do with creating the impression that I am unqualified or unworthy of even making such serious allegations. You know, the bank posturing that it wouldn’t lower itself in even bothering to rebut such serious charges because I was a non-entity. The truth is that I am not even a flea on the back of the elephant JPMorgan and that extends to the bank being in position to crush me through legal intimidation. It shouldn’t make a difference who I am, but the nature and specifics of my allegations and whether they were made in good faith.
I didn’t wake up one day 30 years ago and plot that over the next three decades I would be involved in a never-ending effort to stop an ongoing silver manipulation. Neither did I wake up one day seven years ago plotting how I would accuse JPMorgan of the most serious market crime of all. The truth is that when I started to allege that JPMorgan was manipulating silver prices to their own financial benefit, it scared the dickens out of me; especially my concern for how it might adversely impact my wife. Who in their right mind wouldn’t be afraid of going up against a behemoth like JPM whose army of lawyers could easily tie you up in a legal and financial quagmire lasting perhaps beyond your natural life?
But fear is the most fleeting of all emotions, in markets or daily life, and I am less fearful of what JPMorgan (or the CME Group) may do to me than I am determined to bring this issue to a head. For many years, I was forced to allege that silver was manipulated in price as a result of a concentration on the short side of COMEX futures by the four and eight largest traders, which is still the case. But because commodity law shields traders’ identities, I couldn’t put a name on the biggest manipulator for sure. Oh, I had some good guesses, including an early one that it was AIG, but I failed to uncover that AIG passed the main silver and gold manipulator role to Bear Stearns, until after Bear bit the dust in early 2008.
Bear Stearns’ demise and its takeover by JPMorgan changed everything. First there was the shock of the Bank Participation Report of August 2008 which revealed one or two US banks held an unprecedented and manipulative share of the short side of COMEX gold and silver (which I speculated was JPM) and then there was the actual confirmation by the CFTC that JPMorgan was the big short.
After more than 20 years, I was able to name the big silver crook as being JPMorgan. Let’s face it – in any manipulation, there has to be a central player on which the manipulation depends. CFTC data prove that JPMorgan has been the prime manipulator in silver since March 2008. Without that data, I would have never named JPMorgan as the big silver crook and it is only because CFTC data since then have continued to prove JPMorgan has remained the big silver crook have I remained on the bank’s case. What data am I talking about?
I am talking about the data over the past seven years that show JPMorgan of having sold short on every silver rally to cap those price rallies to the extent that the bank held short positions that sometimes totaled over 200 million ounces and more than 30% of the entire market. And then the bank buying back every short position it added at a profit, never once taking a loss. Now this crooked bank has amassed more than 400 million ounces of physical silver at the depressed prices it created itself by continuing to short futures on the COMEX.
So let’s get back to why JPMorgan has been silent in the face of allegations that would constitute libel if they weren’t true. There is only one possible explanation – the bank just doesn’t want to go there. To react in any way to allegations that it is crooked in silver would bring outside attention to this issue. Any blowback from JPM against me would invite an investigation by the media and the investment community into what this issue is all about. I believe JPMorgan knows this and is doing what it can to prevent exposure, namely, allowing the allegations to go unanswered.
Ironically, I desire the opposite – my goal is to secure an open and fair review of the facts. I have always taken the high road, by bringing my allegations first to the regulators and now to JPMorgan directly and giving them the opportunity to explain why my allegations are misdirected. I do so again today.
If my analysis is wrong and my allegations of silver price manipulation mistaken, I should be required to retract anything I’ve written that was wrong. JPMorgan is the big silver crook; I say that not to damage the bank, but to persuade it to end its criminal ways. I fully realize that I am laying more than 30 years of intense and specific analysis on the line and please know I recognize just how daunting is that prospect. At this point, however, I’d rather be proven wrong than to see JPMorgan’s unprecedented silence and the silver manipulation continue.
For subscription information please go to www.butlerresearch.com