Silver Short Position Could Cost JP Morgan Billions In Losses

National Inflation Assk ^ | 10-28-2010 | NIA

[blam]

Silver Short Position Could Cost JP Morgan Billions In Losses

National Inflation Association
October 28, 2010

It was just announced late Wednesday that two lawsuits have been filed in Manhattan federal court against JP Morgan and HSBC Holdings Inc. accusing them of manipulating the price of silver by "amassing enormous short positions". The suits were filed by Brian Beatty and Peter Laskaris, who each claim they lost money trading COMEX silver futures and options contracts as a result of JP Morgan's alleged manipulation.

In NIA's latest documentary 'Meltup' that was released on May 13th, 2010, and has now been viewed by over 855,000 people, NIA's President Gerard Adams exposed the manipulation of silver that has been taking place by JP Morgan.
Mr. Adams discussed in detail in 'Meltup' how on March 14th, 2008, the very day Bear Stearns failed was the same day silver reached a multidecade high of about $21 per ounce. According to Mr. Adams, Bear Stearns was on the verge of being forced to cover their naked short position in silver, which could have quickly sent silver as high as $50 per ounce.
This would have caused a loss of confidence in the U.S. dollar and a possible currency crisis. Instead of allowing this to happen, the Federal Reserve orchestrated a bailout of Bear Stearns and JP Morgan acquired their assets with the backing of the Fed.
Shortly after taking over Bear Stearn's silver short position, JP Morgan was able to manipulate the price of silver down to below $9 per ounce.

NIA exposed in 'Meltup' that JP Morgan was short 30,000 silver contracts representing 150 million ounces of silver. This is one of the largest concentrated short positions in the history of all commodities, representing 31% of all open COMEX silver contracts

[subterfuge]

Bailout!

[blam]

"Meltup"

[FromLori]

Related

UPDATE 3-JPMorgan, HSBC sued for alleged silver conspiracy

http://www.reuters.com/article/idAFN2725907120101027?rpc=44

http://www.freerepublic.com/focus/news/2615934/posts?page=5

[CharlesMartelsGhost]

Hunt brothers 1980’s redux?

[facedodge]

No one should be bailed out, especially for holding a short position, let alone a manipulative massive short position. Let the shorts burn.

Off topic:
Run-away manipulative shorting destroys the market. Shorting should not be illegal, but there are provisions in place such as regulations against naked shorting that are not enforced. The SEC needs to stop wacking it and do some real work.

[cherry]

the “Phil’s gang” guy on radio is always saying the little guy, the individual investor has no chance when up against the big outfits who trigger computer trading instantly....I tend to agree...

[FromLori]

Also not the first time and oh oh add this to all those putbacks/lawsuits over home foreclosures...

Silver Short Position Could Cost JP Morgan Billions in Losses, Says NIA

http://www.prnewswire.com/news-releases/silver-short-position-could-cost-jp-morgan-billions-in-losses-says-nia-106058478.html

Metal$ are in the pits
Trader blows whistle on gold & silver price manipulation

Read more: http://www.nypost.com/p/news/business/metal_are_in_the_pits_2arTlGNbMK7mb1uJeVHb0O#ixzz13gEryA6g

Feds probing JPMorgan trades in silver pit

http://www.nypost.com/p/news/business/feds_probing_jpmorgan_trades_in_gZzMvWBqOJpB55M7Rh9vwM

Is JP Morgan’s Silver Manipulation Over?

http://inflation.us/jpmorgansilver.html

2008

http://news.silverseek.com/TedButler/1226344970.php

[facedodge]

I invest in inherently risky start-up biotechs. There are short biased hedge funds that will short a stock up to 50% of the outstanding share count. In many cases, these start-ups are not able to finance or extremely hindered due to this. They are not able to get the money they need to fund trials for potentially life saving drugs/treatments, and many times just go bankrupt.

Shorting, when done in moderation, can add some stability to the market, but when done like this, where the short actually harms the company with a diluted share price, it is unjust, and in the case of a start-up biotech, it is immoral.

[trailboss800]

ping

[bjc]

Predatory shorting, perhaps?
On the other hand, many biotech start-ups are under-capitalized from Day 1. That they issue stock strikes me as the source of the shorting problem.

[Frantzie]

Anymore, most of the shorting is predatory - destroying smaller companies.

They will find any reason to bash a company. There have been many examples of decent companies being attacked by these thugs/scum.

[NonValueAdded]

Hmmm ... seems to me that Bear Stearns was the culprit with the naked short position and the pending covering that would have crashed it all. So the gubermint arranges for JP Morgan to play white knight and assume the assets. While the subsequent actions now carry the name JP Morgan, was JP's "manipulation of the price down to $9" in fact a restoration of the status quo as they unwound the Bear Stearns' fiasco? Are these investors complaining that their piggy back of the Bear Stearns game should have continued and that JP Morgan had a duty to carry on the shorting? Is this just a waaaambulance chasing suit?

I suspect that there is some language in the bailout deal that will protect JP Morgan. Otherwise, why would a company agree to assume the assets on any failed entity if unlimited liability for the misdeeds of the original company came with?

[barb-tex]

I distrust any transaction where one does not buy or sell a contract but assumes a position.
Also when your statement has printed on it “Last item in columnis loss unless otherwise noted. I have already had my fun with the BOT.
barbra ann

[garbanzo]

it is unjust, and in the case of a start-up biotech, it is immoral.

And this matters why? The fund manager only cares about making his numbers for the quarter or the month. If he doesn't, he's fired and someone else takes over his fund. So why not bet heavily against a high risk venture even to the point of causing it to tip over. Why exercise any restraint when there's money to be made?

[panaxanax]

bump for later..