A letter, received recently by the US Commodity Futures Trading Commission, implicates JP Morgan Chase in global silver market manipulation. The letter, claiming to be from a current JP Morgan employee, was posted March 14, 2012, and was briefly displayed on the Public Comments area of the CFTC website.
The letter’s author, signing himself, “The First Whistleblower Of Many,” says that he is not Robert Gottlieb, but that Gottlieb is “a trader involved in a lawsuit for manipulative trading while working with JP Morgan Chase.” He effectively outs Mr. Gottlieb, if the assertions are true, by naming him as someone who was acquired with the Bear Stearns merger. He identifies Gottlieb as “notorious” for shorting silver futures. Blythe Masters, Gottlieb’s IB Global higher-up is also mentioned.
First Whistleblower further states that his desire is to remain anonymous, as he fears recrimination from the revelations his letter contains. Among these observations are alleged involvement with unnamed elected officials and complicit institutions, arrogance and back-door cronyism. Claiming his dispatch to be a reaction to “Mr. Smith’s open letter to Goldman,” recently released to the public, he describes his communication as “an open letter to all commissioners and regulators.”
Among the most scandalous assertions proposed in the letter is that those who are “in the know at JP Morgan fear a cascading Greek credit event” due to JPM’s maintenance of “hidden derivatives in excess of one-trillion US dollars.”
Manipulation of the gold market is of secondary concern to the letter’s author, but notably he accuses the banking giant of controlling approximately twenty-five percent of the silver futures market, by using short-selling to manipulate silver valuations. Calling out the CFTC, the anonymous letter writer states that the silver position held by JPM is, by the organization’s own definition, in excess of what it should be for speculative and hedging purposes.
As evidence supporting his claim, the letter’s author cites management communication to JPM employees at the end of 2011 in which they were told that no bonuses would be to be paid to current employees, since profit at JP Morgan was expected to be meager in 2012. January was the time frame in which JPM’s precious metals short positions were significantly increased. Perhaps, not oddly, this is precisely the time that all employees were given either a raise or a bonus. Four other unnamed “major institutions” were alleged to have a hand in recent wide downside swings in both silver and gold.
The unknown whistleblower ends his letter with an expression of concern for the American middle-class. Those who invest in mining stocks and physical precious metals assets may find that they are short the value of their assumed-safe portfolios. Unscrupulous forces can only be brought in check by brave and honest people, who know the likely result of such manipulation, and are closely aligned with the entities who perpetuate it.
http://comments.cftc.gov/PublicComments/ViewComment.aspx?id+57019&SearchText
