To the Top Ten Institutional Shareholders and Top Ten Mutual Fund
Shareholders of JP Morgan:
It's news that JP Morgan is being sued for
manipulating the silver market by maintaining a large concentrated naked
short position in futures contracts on the CME's COMEX metals exchange.
The lawsuits were announced just days after a brave man in government,
Bart Chilton, Commissioner of the CFTC (http://www.cftc.gov/),
the Commodities Futures Trading Commission, made a statement that
acknowledged silver price manipulation.
The lawsuits mean that very intelligent lawyers believe that JP
Morgan's short position is so obvious and provable that there is a case to be
made, and money to be won from JP Morgan, and they feel that perhaps they
will get help even from those in government, such as Judges. Blood is
in the water, and JP Morgan is the one bleeding.
The news articles of the lawsuits don't tell the full story.
See, I know the men who helped expose JP Morgan as the silver short, and I
help to inform those men, and promote their work. I was the first to
file an antitrust complaint to the US Justice Department against JP Morgan
for silver manipulation in April of 2010. http://silverstockreport.com/2010/doj.html
JP Morgan is also the custodian of the silver ETF, SLV, which also
does not likely have all the silver, which would be another short position.
JP Morgan's third short position in silver is likely a much larger
naked short position in silver than the other two combined, and it's through
the "over the counter" silver market, which has been up to $200
billion in size according to the BIS, the Bank of International
See the second link, above, the pdf file,
the second table, Table 22A:, under the category
"other precious metals". The "Notional Amounts
Outstanding" in June 2009, were $203 billion.
Jeffrey Christian, bullion bank apologist, at the CFTC hearing on
silver on March, 25th, 2010, admitted that silver was traded and leveraged
"over 100 to 1" in the London market.
JP Morgan also holds the largest derivatives positions of any banks,
at $69 Trillion, according to the US OCC. Thus, it is likely that JP
Morgan also holds the largest short position in silver derivatives, too, as a
matter of course, since they dominate derivatives trading in general.
So, to them, a $100 billion short position in silver would be "chump
change" compared to their other derivatives positions, and may, in
actual fact, be a part of a larger overall strategy to maintain the value of
their other derivatives, (including the US dollar) to keep interest rates
See the last page of the second link, the pdf
link, above. The OCC sometimes changes the location of these links, so
if the link breaks, you might want to ask one of your junior researchers to
locate them for you, or look around the occ.gov page for a few minutes to
find it yourself, or simply contact the OCC as ask them for a copy of their
"Quarterly Report on Bank Trading and Derivatives Activities"
Second Quarter 2010
So, the problem is simple to understand, but complex to solve, because
JP Morgan's market influencing positions cannot be closed without massive
losses that will bankrupt JP Morgan, and perhaps also significantly devalue
the US dollar.
The world's annual silver production is estimated at between about 550
million ounces of silver to about 650 million ounces. At 600 million
oz., at $25/oz., that's a tiny $15 billion market. The investment side
of the silver market is even smaller, at only 100 million oz annually, which,
at today's silver prices, is a much smaller $2.5 billion market.
Key problem: How can the world's leading banks, (probably mostly
JP Morgan) sell $100 billion worth of silver in 6 months, which is 6.66 times
the entire world's annual production of only $15 billion worth of silver, and
about 50 times the actual physical silver investment market, and it not be
fraudulent silver, not real silver, which creates this problem?
But the problem is much bigger than how it might appear from just that.
See, in 1980, silver prices hit $50/oz. That was when M3, the money supply
in the US, was a tiny $1.8 trillion. Today, it's
$18 trillion, and growing at a rate of about $2 trillion per year, which is
the what the US government must print to pay their bills. So, the
inflation-adjusted price of silver could be ten times higher, or up to
$500/oz., if only 1% of the population of the USA began to buy silver.
See, 1% of $18 trillion is $180 billion. How can $180 billion
pour into the real and actual physical tiny silver market of $15 billion (or
the tinier silver investment market of $2.5 billion) without driving the
silver price to $500/oz.?
See, the problem is that the silver price will hit $500/oz. just for
starters, by the time only 1% of people in the USA alone try to protect their
wealth from inflation by buying silver and gold, and the way things are going
in government, that's nearly a given by now.
If my reading of the OCC report is any indication, then JP Morgan's
short position in silver could be as high as 25% to 50% of the entire world
banking system's short position of $200 billion in silver (and that was when
silver was $15/oz.)!
JP Morgan's short position in silver could thus be as high as 3.3
billion ounces if we are conservative, and estimate their position at only
25% of the BIS report numbers. By $500/oz., JP Morgan's short
position could be worth a negative $1.5 trillion, and that's just for
starters. It could grow worse if they add to their short position, in a
misguided attempt to manipulate a market that is clearly moving against them.
That kind of activity by a rogue trader brought down Barrings Bank, as showcased by the 1999 movie,
The other problem is that silver is mostly consumed by industry, as
it's the greatest conductor of electricity in the world, and is used up in
10,000 applications. Only oil has more applications, but oil can't be
used as money. It's just way too hard for the average person to store
$8000 worth of oil in 100 barrels on their front lawn, and apartment dwellers
never could. Gold is also unsuitable as money for most people, because
a tiny tenth ounce piece is just too valuable if it became worth about a
month's salary, a historic norm.
I submit the problem is bigger than what your brightest minds, your
brightest economists, and brightest students in today's world can solve.
See, there is no central bank of silver. There is no lender of last
resort for silver. And you can't print silver to solve this problem,
because at the end of the day, real silver is needed by industry.
Developed nations, such as the USA, consume, in industry, about
6/10ths of an oz. of silver per year, per person. As the world economy
grows, that will increase.
Silver also has the smallest number of years of resources in the
ground of nearly any major metal. It's about a 14 year supply.
(This is substantially smaller than the world's 40 year supply of oil.)
But the solution is simple if you can trust in God.
Be honest. Be honest first. Trust that honesty brings
rewards and blessings from God.
May I humbly suggest a few simple solutions to your problems
concerning your positions in JP Morgan, given JP Morgan's major financial
problems with their short position and shortage of physical silver?
1. Buy silver.
2. Sell JP Morgan shares.
Or, well, scratch that, or you can reverse
it. You could sell JP Morgan shares and use the proceeds to buy
Most of all 20 of your institutions own about $2.5 billion worth of
shares, on average, of JP Morgan.
I can guarantee you that the facts dictate that your shares of JP
Morgan will not retain their value nearly as well as will silver.
I can also guarantee you that it's a race to get silver, and you are
all probably not even in the race, given the tiny size of the silver market.
If even one out of 20 of you decided to act, I can guarantee you that
silver prices would double and exceed $50/oz, before any one of you were able
to buy even $1 billion worth of physical silver.
On September 2nd 2010, at the start of this rally in silver prices, I
wrote a simple letter to the top 25 billionaires of the world, declaring that
none of them would be able to buy much silver below $20/oz. Based on
recent silver prices rising to over $29/oz., and holding at $26, it appears I
Dear Billionaires of the World
I gave specific advice on how to accumulate large positions in silver,
and who to contact to get it. Of course, you, or anyone else, can also
simply call me or my associates at the JH MINT. www.jhmint.com
It is actually against my best interests to write to you, for several
reasons. See, since I know silver is money, I therefore use silver as
my "unit of accounting" internally as a bullion dealer at the JH
MINT. I count all my assets in terms of dollars, and also in terms of
silver. During the recent rise in silver prices, our assets are
increasing in terms of dollars, of course. But not in terms of silver.
Why not? Because we lose "silver value" on our small cash
positions, and we lose "silver value" on our larger gold
positions. So, even though over 65% of our assets are in the form of
silver, and even though we are having record sales volumes, we are not able
to "accumulate silver value" from operations during this bull
market in silver, because silver prices are simply rising too fast.
Furthermore, by sharing with you this information, I risk creating a
silver shortage at many of my own suppliers, which could literally put my
successful silver dealing business out of business.
I can therefore state with near absolute certainty that if you tried
to value the wealth of your institutions in terms of ounces of silver, you
would do nothing but "lose money" in terms of ounces of silver, no
matter what you do, no matter how great you think your investment decisions
will be, no matter how much silver you accumulate, during the next ten to
twenty years of the continuing bull market in silver.
This is your first and only warning about the facts of silver that I
will ever give you. I will not contact you again, just as we never
pester any of our clients by phone.
I strongly advise you to take possession of real gold and silver,
at anywhere near today's price, while you still can. The fundamentals
indicate rising prices for decades to come.
Our Coin Shops are open 10AM to 5PM Pacific Time, Monday to Friday, closed
JH MINT & Coin Shop, Grass Valley, CA -- our largest store, minimum $1500
to ship, USA shipping only, free shipping.
Kerri: 530 273 -8822 email@example.com
Rocklin Coin Shop, CA -- 15 min north of Sacramento on HWY 80
Mom's Silver Shop, Sacramento, CA
3510 Auburn Blvd., #12
Sacramento, CA 95821
(916) 481 5656
(Mom will ship with no minimum order size, and overseas, and take credit
cards and paypal.)
Oakland Silver and Gold
3929 Piedmont Ave.,
Oakland, CA 94611