Email sent to Bill Murphy of GATA
1/30/08
Hi Bill -
After many ranting and raving
emails to the CFTC about the 20M oz. SLV inventory "switcheroo" on
12/31/07 I finally got a response....well kinda.
Before I go into it I'd like to
commend David Kass of the CFTC for his answer. My
emails to the CFTC are sometimes....shall I say "confrontational"
but he has the ability to brush off my attitude and answer the real questions
the best he can.
Here was the question I asked
and here is the following exchange:
"Question for the CFTC: Is
any of the silver pledged to SLV also seen as deliverable silver by the CFTC
to cover the enormous short position in silver on the COMEX? Would this
inventory sleight-of-hand count as deliverable silver for the silver
shorts?"
___________
Here was his response on 1/30/08
9:46am
dkass@CFTC.GOV
Dear Mr. Weir:
I apologize for the delay in
answering your question. I believe that I can offer some insight into whether
physical silver held against the iShares Silver
Trust (quote symbol: SLV) could be deliverable against NYMEX silver futures. The
iShares Silver Trust has a Form S-1 on file with
the Securities and Exchange Commission [see this hyperlink: iShares Silver Trust]. The Trust’s statement on custody and location(s) of the
physical silver reads as follows:
“The custodian may keep
the trust’s silver at locations in England or
with the consent of the trustee and the sponsor, in other places. The
custodian may, at its own expense and risk, use subcustodians
to discharge its obligations to the trust under the custodian agreement. The
custodian has agreed that it will only retain subcustodians
if they agree to grant to the trustee and the independent accountants of the
trust access to records and inspection rights similar to those granted by
JPMorgan Chase Bank N.A., London
branch, in its agreement with the trustee. The custodian will remain
responsible to the trustee for any silver held by any subcustodian
appointed by the custodian to the same extent as if such silver were held by
the custodian itself. “
The plain language appears to
allow the possibility that physical silver held in custody of the Trust could
be held in vaults outside of England.
Nonetheless, based upon the January 16, 2008, listing of bars of silver held
by the custodian [found on the iShares Silver Trust
website: iShares® Silver Trust (SLV): Overview], silver currently held by the Trust appears to be entirely in London. Silver in London vaults is not
deliverable against the NYMEX futures contract. If, in the future, any of the
silver held by the Trust were to meet the location, brand, size, and quality
standards of the NYMEX silver futures contract, it could be deliverable on
that contract. We cannot opine on whether the Trust could or would hold
silver in NYMEX-approved vaults, whether any such silver would also meet all
of the futures delivery requirements, or whether the obligations of the Trust
would allow (or preclude) making any such silver available for futures
delivery.
I hope this has been helpful.
David Kass,
Senior Economist
Market Surveillance Section
Division of Market Oversight
Commodity Futures Trading
Commission
dkass@CFTC.GOV
______
Here was my response to Mr. Kass at 10:24
dkass@CFTC.GOV
Hi David
Thanks for the response and your
take on the SLV inventories. I appreciate it.
I am a little confused about why
you think the silver is in London.
Am I missing something in one of the SLV disclosures? I don't see anything
addressing where the bars are stored.
Thanks again,
Bix
_________
Here was his reply at 12:59pm
dkass@CFTC.GOV
Dear Mr. Weir,
My earlier email includes a
hyperlink to the iShares Silver Trust website. On
the left side of that website is a link to the “Silver Bar List,”
which lists the 156,645 individual bars of silver that make up the total of
156,699,416.9 troy ounces of silver held as of January 16, 2008, in the name of the
Bank of New York (the Trustee) at the JPMorgan Chase Bank, London Branch (the
custodian). Also, as I noted below, the Trust is required to keep the
physical silver “…at locations in England or with the consent of
the trustee and the sponsor, in other places.”
Hope this clarifies my earlier
response.
David Kass
___________
Here was my response to his
reply 2:13pm
Thanks again David.
Yes, that's the way I read
"in other places" also. I think I'm confused when you say the
silver "appears to be entirely in London".
I don't see anything in the inventory count that mentions the physical silver
being in London
at all, other than it is controlled by the JP Morgan, London Branch.
Are you saying that it is
possible that if some of the SLV silver was being stored in approved COMEX
warehouses, it could be pledged or identified as deliverable silver in your
monitoring of the silver short position?
I'm sorry for the pestering but
it is very hard for most individual silver investors to get our hands around
the silver dynamics with so much secrecy and backroom dealings in a market
that is supposed to be freely traded.
Please let me get this straight:
1) The original question: Is any
of the silver pledged to SLV also seen as deliverable silver by the CFTC to
cover the enormous short position in silver on the COMEX?
The CFTC answer: It could be
if the SLV silver was stored at a COMEX warehouse and had the proper
specifications.
2) Would this inventory
sleight-of-hand (20M oz) count as deliverable silver for the silver shorts?
The CFTC answer: It could be
if the SLV silver was stored at a COMEX warehouse and had the proper
specifications.
Am I correct in both these
answers?
Clearly, the 20M oz one day
"inventory" deposit and withdrawal in SLV needs to be fully
explained to the public. Being that the CFTC is the watchdog agency in the
largest silver market in the world, I would expect that you would also want
to get to the bottom of this abnormality and investigate. Are you aware of it
and have you looked into it?
New Question: Since the CFTC has
judged that there is adequate "deliverable silver" available to
cover any potential COMEX silver withdrawal and having access to the serial
numbers of both SLV inventories and COMEX approved warehouses, has the CFTC
matched up the serial numbers to see if the silver is pledged to both
situations? Does it matter to the CFTC if deliverable silver is encumbered or
pledged?
Thanks again
Bix
____________
I have not heard back from Mr. Kass yet…must be checking with his legal staff
again.
Now I draw a few conclusions
from this exchange:
1) The fact that I even got a
fairly quick response shows a change at the CFTC which bodes well for the
scrutiny of future manipulations. At least they are appearing to try more
than they used to.
2) The CFTC seems to agree with
friends of GATA that the SLV Trust S-1 filing gives JP Morgan, as custodian,
the right to store the silver anywhere in the world without disclosing its
location although it is clear to me that the “delay” in his
response was clearing it through the CFTC legal department. I love the line
"The plain language appears to allow the possibility that
physical silver held in custody of the Trust could be held in vaults outside
of England."
What kind of "plain language" also "appears to allow the
possibility"?! Plain language would state "physical silver can be
stored at any location". That is "plain language".
3) The CFTC believes that the
SLV 162M oz. of silver resides in London
and thus does not count it as deliverable silver against any of the oversized
short positions. That is what he stated. Unfortunately, they only believe
this to be true by saying "the silver currently held by the Trust
appears to be entirely in London"
but have not confirmed it to be fact. He left the CFTC a very big legal
“out” unless it can be proven that the CFTC was aware of that
some of the SLV inventory was in COMEX warehouses. The CFTC should have or
could gain access to the COMEX serial # information. Double counting can be
easily proven by matching the serial numbers posted on SLV and those in the
COMEX warehouses now that the SLV serial numbers are posted.
4) My theory that JPM bumped the
SLV silver storage numbers at the end of the year to legally prove to the
CFTC they can deliver against the short position can not be true IF the
silver is in London BUT it is clear from Mr. Kass's
second email that he wants to point out that the silver can be stored
"in other places". Why then does the David Kass
go out of his way to send the “clarifying memo” after I question
the CFTC belief that the silver resides in London? Why was he was trying to
“clarify” his “plain language”. The
"switcheroo" theory still stands.
5) It seems the CFTC does not
know or care if any of the "deliverable silver" is in any way
leased, swapped, loaned or otherwise encumbered when they determine that it
is deliverable against the gigantic silver short positions taken on the
COMEX. The CFTC only requires that the "deliverable silver" meets
the location, brand, size, and quality standards of the NYMEX silver futures
contract. How many times has this silver been pledged? COMEX, SLV, Pooled
Accounts, Storage Accounts, Silver Certificates...how many parties are
claiming ownership?!
6) If the COMEX short position
isn't backed by any of the SLV silver inventories, as the CFTC says it isn't,
then where is the deliverable silver the CFTC requires that could ever cover the over sized silver short position? How
do they confirm that this silver is truly deliverable and not otherwise
spoken for? The line "If, in the future, any of the silver held by the
Trust were to meet the..." sounds like they are expecting at some point
that silver may be removed from London and used to back silver shorts in the
US. What silver is backing the shorts now?
Where does this leave us? Nowhere
today but as the reality of silver manipulation unfolds and people try to
cover their "legal backsides" we have a record building of official
denials. I will keep you updated on future contact
with the CFTC and the remaining questions that were raised but not yet
answered.
Maybe the next WSJ article
should read "Anybody Seen Our Silver"!
Great days for GATA!
Bix
END OF EMAIL TO BILL MURPHY
After my exchange with Bill I
began to dig deeper into the ETF’s. Knowing
in my gut that they are a gold and silver market manipulation tool, I began
to do some research and found a treasure trove of secrets I’m sure the
Cabal would rather have stay secret. Sorry, but anything I write must take
into account my “Road to Roota”
theories by familiarizing yourself with parts 1 & 2.
Part 1-Implementation of the
Gold Standard
http://www.lemetropolecafe.com/Pfv1.cfm?pfvID=6007&SearchParam=road%20to%20roota
Part 2- Maestro
Greenspan’s Magnum Opus
http://www.lemetropolecafe.com/Pfv1.cfm?pfvID=6468&SearchParam=road%20to%20roota
For years gold and silver
investors have witnessed and analyzed the rigging of the gold and silver
markets in plain view. This market rigging has always had the characteristics
of a computer based trading program yet proof has been sparse. Mike Bolser has probably come the
closest to proving the manipulation with his DIVG analysis (http://www.interventionalanalysis.com/), but the ever elusive evidence always seemed to fall short of
proving who was behind the market rigging. Was it JP Morgan as agent for the US
government, was it a cabal of global bankers, was it
an evil band of one world government types run by the Rockefellers or Rothschilds or Illuminati? At
the end of the day the WHO part of the mystery was fairly elusive. Personally,
I think it is all of the above but unfortunately I too do not have the proof.
Having said that, I have come across a very suspicious company that I believe
coordinates the computer manipulation of the gold and silver markets and is
directly connected to the iShares silver ETF as
well as the StreetTracks Gold ETF.
This company is not public, has
few employees, is fairly invisible and has only been in operation since 2002.
Yet somehow, it has amassed a computer based trading platform so vast and far
reaching that in just 5 years it boasts of being a “leading market
maker….on 25 exchanges and market centers
globally.” So how did a startup trading
company build such a large and powerful trading network so fast? What if I
were to tell you that this little known company was closely connected to the
senior banking Cabal market rigger himself Mr. Robert Rubin and the
former NYMEX Chairman Vincent Viola?
First let’s look at the
“Authorized Participants” of the gold and silver ETF’s as outlined in the StreetTracks
GLD Prospectus and the iShares SLV Prospectus:
http://streettracksgoldshares.com/pdf/streetTRACKS.pdf
http://www.ishares.com/content/stream.jsp?url=/content/repository/material/prospectus/silver.pdf
iShares - Silver StreetTracks
– Gold
Barclays Capital, Inc. Bear
Hunter Structured Products LLC
Bear, Stearns & Co. Bear,
Stearns & Co. Inc.
Citigroup Global Markets Inc. BMO
Capital Markets Corp.
Credit Suisse Securities, LLC
CIBC World Markets Corp.
Goldman Sachs & Co Citigroup
Global Markets Inc.,
Goldman Sachs Execution &
Clearing, L.P. Credit Suisse Securities (USA) LLC
JP Morgan Securities Inc.
Deutsche Bank Securities Inc.
Merrill Lynch Professional
Clearing Corp. Fimat USA, LLC
PruGlobal Securities, LLC Goldman, Sachs & Co.,
UBS Securities LLC Goldman Sachs
Execution & Clearing L.P.
EWT, LLC HSBC Securities (USA)Inc.
J.P. Morgan Securities Inc.
Lehman Brothers Inc.
Merrill Lynch Professional
Clearing Corp.
RBC Capital Markets Corporation
UBS Securities LLC
EWT, LLC
Obviously the expected names in
the Cabal jump out such as Goldman Sachs, JP Morgan, Barclays, Deutsche Bank,
and other public financial companies with similar interests in keeping the
fiat money system alive and well. (Bear Hunter is a JV of Bear, Stearns). All
with “supposedly” very solid reputations and solid track
records…they are what you would expect an “Authorized Participant”
would be. Incidentally, this list alone should tell you that the gold and
silver ETF’s are not a benign holding company
for an honest investor to place his precious metal holdings. The Prospectus
even states as much over and over and over again. The silver and gold are
100% controlled by the authorized participants. They can put it in and pull
it out at will. Who else in their right mind would lend their precious metals
to an ETF and get NOTHING in return for doing so? It is more than likely that
these hoards of gold and silver have more than one claim against them. Chief
of which I believe is the backing for the oversized COMEX short positions in
gold and silver. Let’s look a little closer at those “Authorized
Participants”…
Wait...who in the world is EWT,
LLC?
I’d never heard of them. They
aren’t a bank or a large publicly traded financial institution like all
the other “Authorized Participants”. Turns out they are a very
private hedge fund that has uses “state-of-the-art technology and
algorithmic models to make electronic markets”. Why is a
“state-of-the-art technology and algorithmic models” company an
“Authorized Participant” in two of the most non-technology
focused securities ever publicly traded…the storage of Physical Gold
and Silver… Let’s find out!
I did a Google search on
“EWT, LLC” and all I found was a boat load of ads trying to hire
computer experts. Interestingly, there is also only one area of their company
website that you can have access to without a “secret password”…what’s
with all the secrets? Here’s their careers section link:
http://www.ewtcareers.com/overview.html
Now read this brochure from the
careers section:
http://www.ewtcareers.com/extras_files/EWT-Careers.pdf
“While our business is
highly profitable, we also perform a critical social good. We make money by
improving prices available to the public and by advertising these prices as
widely as possible. Every second in every major market, our operations ensure
that pension funds, mutual funds, charitable foundations, university
endowments, individual retirement accounts, and the general public obtain
better prices for the assets they buy and sell.”
Am I losing my mind or are they
declaring that “they make money by improving prices”. Isn’t
it against the law to make money by influencing the price? Is this a flat out
admission of fraud? And there’s this:
We are not your father’s
“Wall Street broker”
“We employ
super-intelligent professionals dedicated to teamwork and the open exchange
of ideas. We succeed because of what we do rather than where we went to
school. ….If you feel you are among the smartest people in your class
or peer group, you may possess the intellectual qualities we seek. ….But,
if you are uncomfortable working cooperatively with other highly intelligent
people in a critical, success-oriented environment, EWT is not the place for
you. We leave our egos at the door every morning.”
This is reeks of the arrogance
that pervades the entire cabal….
According to this resume EWT,
LLC had ...less than 10 employees in 2003 (http://www.linkedin.com/pub/5/312/97B) but is now a "leading market maker...on 25 exchanges and market
centers globally"! Wow, these guys are either
REALLY good or REALLY CONNECTED TO SOMEONE POWERFUL!
Let’s look closer.
The co-founders of EWT, LLC were
the former NYMEX Chairman Vincent Viola and a GOLDMAN SACHS MAN named David
Salomon who "reported directly to ROBERT RUBIN". Yes, the King
Pin himself! If you know GATA you know that ROBERT RUBIN = BANKING CABAL
Let’s look at David
Salomon..
“David Salomon co-founded,
with former NYMEX Chairman Vincent Viola, EWT LLC and Madison Tyler, two of
the most successful algorithmic-based trading companies in the securities
industry. He also recently co-founded FATTOC LLC, a trading company and
developer of next-generation trading-related applications for major financial
institutions. Mr. Salomon began his career in finance in the risk arbitrage
department at Goldman Sachs, where he ran the equity strategy group and
reported directly to Robert E. Rubin. Mr. Salomon spent 15 years of his
career as a trader in the energy markets. He was a founding member of the
oil-trading department at J. Aron & Company. He
went on to help found the energy derivatives business at both Banker’s
Trust and American International Group, Inc. (AIG). In 1978, Mr. Salomon
received his B.S. degree in politics and psychology from Princeton University
graduating summa cum laude and Phi Beta Kappa. In 1982, Mr. Salomon graduated
with distinction from the Wharton
School.”
http://vernonpark.com/advisory_commitee.php
(QUICK SIDE NOTE: Mr
Salomon’s company Madison Tyler is where Lawerence Eugene Harris worked while he was on the
Regulation SHO Roundtable that was convened to investigate naked short
selling on the exchanges…I challenge other GATA folks to dig into those
depths!)
http://www.sec.gov/about/economic/shopilot091506/shopilot091506pmbios.htm
Not disturbed
enough yet? Here’s an interesting new rule from the NYSE that will
further disguise our friends over at EWT.
The New
Definition Of Program Trading
Beginning September 30, 2007,
the NYSE changed the definition of program trading to eliminate the $1 million
requirement.
The definition of program
trading was also redefined to be more specifically focused on trades that are
part of a larger "coordinated" strategy.
"Program trading"
means either (A) index arbitrage or (B) any trading strategy involving the
related purchase or sale of a "basket" or group of 15 or more
stocks, provided, however, that the purchases or sales of stocks are part of
a coordinated trading strategy, even if the purchases or sales are neither
entered or executed contemporaneously, nor part of a trading strategy
involving options or futures contracts on an index stock group, or options on
any such futures contracts, or otherwise relating to a stock market index.
What the revised definition
means is that many types of algorithmic trading strategies will not be
considered "program trading." http://news.briefing.com/GeneralContent/Inves...AheadOfTheCurve
How many other
“algorithmic-based” trading companies and hedge funds are in on
the market manipulation game? My guess is there is quite a network working
together with the goal of centralizing the world’s wealth into the
hands of the few. I believe that after the Enron and other high profile
scandals in early 2000 they determined they had to do their dirty work
outside the scrutiny that public companies attract and they have gone
“underground” into private hedge funds. Remember when Greenspan
railed again hedge funds a few years back? Greenspan knows he created a
monster in the 1960’s with his secret computer-based market rigging
programs. Unfortunately, the rigging operations had to be shared with most of
the large financial institutions for them to work and that is like giving
matches to a pyromaniac and telling them not to light up! The market riggers
in the US
became so powerful over the years most have truly abandoned the original
intent of Mr. Greenspan’s plan to add a benevolent “digital
invisible hand” to Capitalism. Now Greenspan and friends in “The
Group” are finding it hard to slay the monster they have created. This
truly is a titanic battle to save what is left of America and the entire world.
Make no bones about
it…EWT, and private companies like it, are using their computer systems
to take over every actively traded market that utilizes digital
systems…they even brag about it!
“EWT continues to expand
into more markets and exchanges, further leveraging the firm’s
technology and trading expertise globally. EWT is becoming a premier
liquidity provider on all major domestic and international exchanges, making
markets in equity, fixed income and derivative securities around the clock,
and around the world. EWT is one of only a few trading firms that combines
today all of the elements required for tomorrow’s trading opportunities
- scalable and cutting-edge technology, uniquely sustainable proprietary
trading strategies and a commitment to investing in human capital.”
So there we have it. The Robert
Rubin connection seals the deal. SLV and GLD are definitely a part of the
computer market rigging operations of the banking Cabal. I believe EWT runs
their rigging programs through the accounts of the “Authorized
Participants” on the COMEX as they buy and sell to each other to fix
prices and orchestrate market take downs. Their designation as
“Authorized Partcipants” of both SLV
and GLD gives the needed credibility for their shorting activities on the
COMEX/NYMEX markets. No doubt about it in my book.
Although nobody really knows, it
is now estimated that over 90% (and rising) of all global trades are computer
program based. 90% and rising! Basically, he who writes the best program, has
the deepest pocket, has the least amount of scrutiny, and is the most highly
connected within the power elite structure WILL ALWAYS WIN! Where does that
leave our free market based Capitalist system in the future? Is this the end
of free markets…or was there ever any such thing?
I’m sorry but I truly
believe without the complete destruction of computer based markets and our
current fiat money system there is no “Liberty and justice for all” in our
future.
Bix Weir
PS – Do not give up hope! The
battle is raging behind the scenes to take back control of the United States
and world. Note the FBI, not the SEC, is investigating “valuation
issues” at 14 banks. Also the Benjamin Fulford
issue I talked about in Part 2 may sound way too conspiratorial but if he was
a “crack pot” how did he arrange this interview with David
Rockefeller who NEVER gives interviews?!
http://www.youtube.com/watch?v=b24ZuNyAckw&feature=related
Keep an eye on the delays of the
“Economic Stimulus Package”. We all know this package (as
announced) would not help cure the multi trillion dollar problem. And why do
they keep sayings “it’s temporary” every time it’s
discussed in public? “It’s temporary”, “it’s temporary”…shut up with that
already….wait…you never know if something is true unless it
officially denied by the government! What is this package really??? Dianne
Feinstein, Nancy Pelosi and Barney Frank are pushing very hard for this and I
believe they are part of the Road to Roota group
trying to take down the cabal. I believe they will delay this bill until the
final blows are leveled against the cabal. Only
then will the real bill be revealed to the world which I think will be very similar
to this: http://nesara.org/files/nesara.pdf
Boy would that be a shot in the
arm for our friend for Ron Paul (also part of The Group!)
Hope…there is always hope.
Bix Weir
Bix Weir is a freelance author and analyst
dedicated to exposing the long term manipulation of the gold and silver
markets. He has worked closely with the Gold Anti-Trust Action Committee
helping to pull the curtain away from the Cabal of International Bankers that
have taken control of our free market system.
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