The Lawless Manipulation of Bullion Markets by Public Authorities
The current takedown of gold from $1900 to $1200 has occurred during a period of time when financial and political fraud and corruption becomes worse and more blatant by the day. Along with this, the intensity and openness with which the metals are systematically beat down seems to grow by the day.
Comex futures trade 23 hours a day via a global computerized trading system known as Globex. The heaviest period of trading occurs when the actual Comex floor operations are open, which is 8:20 a.m. to 1:30 p.m. EST. All other times Comex futures trade electronically via Globex. Gold and silver are smashed primarily during the Globex-only trading periods, when volume is often light to non-existent.
This graph of Comex futures trading on December 16th shows the sudden plunge in the price of silver.
It should be noted that the sudden surge in the computerized selling of silver contracts occurred after the Comex floor trading operation was closed for the day. This is typically one of the lowest volume trading periods, which means that large orders to buy or sell will cause significant price disruption to the market. There were no news or events that would have triggered this sudden selling of silver futures and none of the other markets experienced unusual movements while gold and silver were quickly plunging in price.
To put in perspective the 9,767 silver contracts sold in 15 minutes during low-volume trading, the total trading volume in Comex silver for the 23-hour global trading period for Comex contracts ending at 5:00 p.m. on December 15th was 149,964 contracts, or an average of 6,520 contracts per hour. The only type of market participant that would dump over 9,000 contracts in a 15-minute period during a low-volume time is a seller who’s only motivation is to push the price of silver as low as possible. One entity that can afford to use capital like this is the Federal Reserve, because the Fed can create its own capital for free using the printing press.
In the background, the financial markets are becoming increasingly pressured by declines in emerging market currencies, insolvent sovereign governments–including here in the US–and perhaps a renewed derivatives crisis triggered by the collapse in the price of oil. The oil price decline could result in derivative problems larger than the subprime mortgage derivatives of the 2008 crisis.
