Category: Market News

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Remember when it was pure tinfoil-hat conspiracy theory to accuse one or more banks of aggressively, compulsively and systematically manipulating the precious metals – i.e., gold and silver – market? We do, after all we made the claim over and over, while demonstrating clearly just how said manipulation was taking place, often in real time.

Well, it’s always good to be proven correct, even if it is years after the fact.

On Tuesday after the close, the CFTC announced that Merrill Lynch Commodities (MLCI), a global commodities trading business, agreed to pay $25 million to resolve the government’s investigation into a multi-year scheme by MLCI precious metals traders to mislead the market for precious metals futures contracts traded on the COMEX (Commodity Exchange Inc.). The announcement was made by Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office. In other words, if the Merrill Lynch Commodities group was an individual, he would have gotten ye olde perp walk.

As MLCI itself admitted, beginning in 2008 and continuing through 2014, precious metals traders employed by MLCI schemed to deceive other market participants by injecting materially false and misleading information into the precious metals futures market.

They did so in the now traditional market manipulation way – by placing fraudulent orders for precious metals futures contracts that, at the time the traders placed the orders, they intended to cancel before execution.  In doing so, the traders intended to “spoof” or manipulate the market by creating the false impression of increased supply or demand and, in turn, to fraudulently induce other market participants to buy and to sell futures contracts at quantities, prices and times that they otherwise likely would not have done so. Over the relevant period, the traders placed thousands of fraudulent orders.

Of course, since we are talking about a bank, and since banks are in charge of not only the DOJ, and virtually every other branch of government, not to mention the Fed, nobody will go to jail and MLCI entered into a non-prosecution agreement and agreed to pay a combined – and measly – $25 million in criminal fines, restitution and forfeiture of trading profits.

Under the terms of the NPA, MLCI and its parent company, Bank of America, have agreed to cooperate with the government’s ongoing investigation of individuals and to report to the Department evidence or allegations of violations of the wire fraud statute, securities and commodities fraud statute, and anti-spoofing provision of the Commodity Exchange Act in BAC’s Global Markets’ Commodities Business, whose function is to conduct wholesale, principal trading and sales of commodities.  Laughably, MLCI and BAC also agreed to enhance their existing compliance program and internal controls, where necessary and appropriate, to ensure they are designed to detect and deter, among other things, manipulative conduct in BAC’s Global Markets Commodities Business.

Translation: it will be much more difficult to catch them manipulating the market next time.

The Department reached this resolution based on a number of factors, including MLCI’s ongoing cooperation with the United States – which means the DOJ must have had the bank dead to rights with many traders potentially ending up in jail – and MLCI and BAC’s remedial efforts, including conducting training concerning appropriate market conduct and implementing improved transaction monitoring and communication surveillance systems and processes. Translation – no longer boasting about market manipulation on semi-public chatboards.

The Commodity Futures Trading Commission also announced a separate settlement with MLCI today in connection with related, parallel proceedings.  Under the terms of the resolution with the CFTC, MLCI agreed to pay a civil monetary penalty of $11.5 million, along with other remedial and cooperation obligations in connection with any CFTC investigation pertaining to the underlying conduct.

As part of the investigation, the Department obtained an indictment against Edward Bases and John Pacilio, two former MLCI precious metals traders, in July 2018.  Those charges remain pending in the U.S. District Court for the Northern District of Illinois. 

This case was investigated by the FBI’s New York Field Office.  Trial Attorneys Ankush Khardori and Avi Perry of the Criminal Division’s Fraud Section prosecuted the case.  The CFTC also provided assistance in this matter.

Oh, and for anyone asking if they will get some of their money back for having been spoofed and manipulated by Bank of America, and countless other banks, into selling to buying positions that would have eventually made money, the answer is of course not.

Courtesy of ZeroHedge by Tyler Durden from Wed, 06/26/2019

◆ Bridgewater’s co-chief investment officer Greg Jensen told the Financial Times that gold prices could rally to $2,000 an ounce.

◆ The manager from the world’s biggest hedge fund cited increased income inequality in the U.S. and rising tensions with China and Iran as uncertainties that will prompt more safe-haven buying.

◆ Jensen also believes the Federal Reserve would let inflation run hot for a while, which also creates an environment for higher gold prices.

◆ Spot gold now trades at $1,551.40 per ounce, after crossing the $1,600 mark and hitting a seven-year high last week

FT via CNBC

Gold prices, which briefly topped $1,600 last week, could rally to $2,000 an ounce amid heightened political risks, Bridgewater’s co-chief investment officer Greg Jensen told the Financial Times Wednesday.

The manager from the world’s biggest hedge fund cited increased income inequality in the U.S. and rising tensions with China and Iran as uncertainties ahead that will prompt more safe-haven buying. Bridgewater manages $160 billion in assets, more than any other hedge fund.

“There is so much boiling conflict,” Jensen told the paper. “People should be prepared for a much wider range of potentially more volatile set of circumstances than we are mostly accustomed to.”

Jensen also believes the Federal Reserve would let inflation run hot for a while, which also creates an environment for higher gold prices as investors tend to use the precious metal as a hedge against inflationary forces.

Spot gold rose 0.3% to $1,551.40 per ounce on Wednesday, after crossing the $1,600 mark and hitting a seven-year high last week. The U.S.-China trade war and the Middle East unrest drove investors to more conservative investments for its stability during times of tumult, pushing gold prices higher.

Earlier last year, founder of Bridgewater Ray Dalio advocated putting money into gold as he saw a “paradigm shift” in investing due to global central banks’ expected moves to an easier monetary policy.

The Federal Reserve cut interest rates for three times last year to combat a slowing economy. Jensen said it’s possible the central bank could slash rates to zero this year to avoid a recession and disinflationary pressures.

Bridgewater is not alone in recommending gold bullion. DoubleLine CEO, Jeffrey Gundlach also said last year he was a buyer of gold on expectations that the dollar would weaken.

Courtesy of Alt-Market by Brandon Smith

There are a multitude of false assumptions out there on what the collapse of a nation or “empire” looks like. Modern day Americans have never experienced this type of event, only peripheral crises and crashes. Thanks to Hollywood, many in the public are under the delusion that a collapse is an overnight affair. They think that such a thing is impossible in their lifetimes, and if it did happen, it would happen as it does in the movies – They would simply wake up one morning and find the world on fire. Historically speaking, this is not how it works. The collapse of an empire is a process, not an event.

This is not to say that there are not moments of shock and awe; there certainly are. As we witnessed during the Great Depression, or in 2008, the system can only be propped up artificially for so long before the bubble pops. In past instances of central bank intervention, the window for manipulation is around ten years between events, give or take a couple of years. For the average person, a decade might seem like a long time. For the banking elites behind the degradation of our society and economy, a decade is a blink of an eye.

In the meantime, danger signals abound as those analysts aware of the situation try to warn the populace of the underlying decay of the system and where it will inevitably lead. Economists like Ludwig Von Mises foresaw the collapse of the German Mark and predicted the Great Depression; almost no one listened until it was too late. Multiple alternative economists predicted the credit crisis and derivatives crash of 2008; and almost no one listened until it was too late. People refused to listen because their normalcy bias took control of their ability to reason and accept the facts in front of them.

There are a number factors that cause mass blindness to economic and social reality. First and foremost, establishment elites deliberately create the illusion of prosperity by rigging economic data to the upside. In almost every case of economic crisis or geopolitical disaster, the public is conditioned to believe they are in the midst of a financial “boom” or era of “peace”. They are encouraged to ignore fundamental warning signs in favor of foolish faith in the system. Those people that try to break the apathy and expose the truth are called “chicken little” and “doom monger”.

In the minds of the cheerful lemmings a “collapse” is something very obvious; they think they would know it when they saw it. It’s like trying to teach a blind person about colors; it’s not impossible, but it’s very difficult to get all these Helen Kellers to understand that what they perceive is not the whole reality. There’s a vast world hidden from them and they have no concept of how to observe it.

Crash events are like stages in the process of collapse; they create moments of clarity for the blind. However, they are also often engineered to benefit the establishment. There’s a reason why the elites put so much energy into hiding the real data on the state of the economy, and it’s not because they are trying to keep the system from faltering by using sheer public ignorance. Rather, a crash event is a tool, a means to an end. As Congressman Charles Lindbergh Sr. warned after the panic of 1920:

“Under the Federal Reserve Act, panics are scientifically created; the present panic is the first scientifically created one, worked out as we figure a mathematical problem…”

Central bankers and their cohorts manipulate economic data and promote the false notion of a boom before almost every major crash because they WANT to ambush the populace. They WANT to create panic, and then use it to their advantage as they rebuild and mutate the system into something unrecognizable only decades ago. Each consecutive crash contributes to the collapse of the whole, until eventually the society we once had is barely a distant memory.

This process can take decades, and the US has been subject to it for quite some time now. Once again in 2019 we are seeing the lie of an “economic boom” being perpetuated in the mainstream. The public was growing too aware of the danger and had to be subdued. More specifically, conservatives were growing too aware. The sad thing is that the boom propaganda is most prominent today among conservatives, who are desperately trying to ignore the fundamentals in an attempt to defend the Trump Administration.

The same people who were pointing out the economic bubble under Obama are now denying its existence under Trump. Trump himself argued that the markets were a dangerous economic fraud created by the Federal Reserve during his campaign, yet once he was in office he flip-flopped and started taking full credit for the bubble. What is mind boggling to me is that many people, even in the liberty movement, still choose to dismiss this behavior in favor of worshiping Trump as some kind of hero on a white horse.

This only reinforces my theory that the system is due for another major engineered crash event, and that the ongoing collapse of the US is soon to accelerate. Each case of economic calamity in modern history was preceded by peak delusional optimism and peak greed. When the people traditionally most vigilant against crisis suddenly capitulate and claim victory, this is when reality strikes hardest. This is when the establishment triggers yet another controlled demolition.

In order to determine how long an empire will last, one has to take into account the agenda of the elites that control its institutions. As long as they are in key positions of power within the system and as long as they can inject their own puppet politicians, they will have the ability to influence the collapse timeline of that system.

Can they prolong and stave off crisis? Yes, for a short while. However, once the machine of a crash has been set in motion the best they can do is slow down the Titanic; they cannot change its path towards the iceberg. And frankly, at this point why would they? I hear it argued often that the elites are going to “keep the plates spinning” on the economy and that they don’t want to lose their “golden goose” in the US economy. This reveals an naivety among skeptics of the true agenda.

Firstly, the elites have a highly useful political puppet in the form of Donald Trump; he is useful in that he inspires sharp national division, and, he is a self proclaimed conservative champion and nationalist. If the elites did not trigger a crash under Trump, then this would give the public the impression that conservative ideals and national sovereignty works. This is the opposite of what they want. Why would globalists that want the erasure of nation states and the creation of a centralized socialist “Utopia” seek to make conservatives and nationalists look good? Well, they wouldn’t.

The only concern of the banks is that they do not take the blame as their engineered collapse of the old world order hits the public with increasingly painful consequences. These consequences are already becoming visible.

The next major crash has begun in the form of plunging fundamentals, and far too many conservatives are placing their heads in the sand for the selfish sake of proving the political left wrong. Declines in US manufacturing, US freight, global exports and imports, mass closures in US retail, as well as all time highs in consumer debt, corporate debt and national debt are being shrugged off and rationalized as nothing more than “hiccups” in an otherwise booming economy. The Fed’s repo market purchases, barely keeping up with demand from liquidity starved corporations are also not being taken seriously.

Conservatives and analysts are going to have to forget about supporting Trump, a Rothschild owned proxy, and start acknowledging reality once again. The only question now is, will the elites allow the crash to spread further into mainstreet and strike markets before or after the 2020 election?

As noted above, to predict the timing of a collapse in a nation or empire, one has to examine the agendas of the elites that dominate its institutions. We can gain some sense of timing from the public admissions of globalist organizations like the IMF and the UN. Each has announced the year 2030 as a target date for the finalization of globalization, a cashless society and sustainability goals. This means that the elites have around ten years to create a crisis and then “solve” that crisis with globalism.

Ten years is a narrow window, and if the elites intend for conservatives to take the blame for the next crash, they will have to initiate it soon. They may not have a choice anyway, as the chain of dominoes was already been set in motion by the Fed in 2018 with its liquidity tightening policies.

We can also gauge timing of a collapse to a point by understanding the common tactics the establishment uses to hide what they are doing.  Generally, when a collapse is about to accelerate the elites use crisis events as cover to distract the public and produce scapegoats.  In my article ‘Globalists Only Need One More Major Event To Finish Sabotaging The Economy’, I outlined three potential distractions that could be used in the near term, and if any of these events took place, then people should watch for the collapse to move faster.  Two of these events now appear imminent:  The first being a war with Iran, and the second being a ‘No Deal’ Brexit.

Finally, we can take into account the globalist need for a scapegoat, and it appears that conservatives and nationalists are their target for blame.  This leaves less than one year for a crisis event if Trump is intended to leave the White House in 2020, or less than four years if he is intended to stay in for a second term.  Keep in mind that A LOT can happen in a single year, and a second Trump term is certainly not guaranteed yet.

But why create a collapse in the first place?  Crash events allow the establishment to consolidate control over hard assets as poverty forces the population to sell what they have to survive. This poverty also creates fear, which makes the public malleable and easier to control. Each new crisis opens doors to political and social changes, changes which end in less freedom and more centralization. Collapse is a succession of crashes leading to a complete erasure of the original society. It’s not a Mad Max event, it’s a hidden and insidious cancer that takes over the national body and warps it into a wretched form.  The collapse is complete when the nation either breaks apart, or is so damaged for so long that no one can remember what it used to look like.

What we are witnessing today is the beginning of a new crash, and the final phases of a collapse of our way of life. The economic boom narrative among conservatives is a farce designed to trick us into complacency. The bubble that we warned about under the Obama Administration has been popped under the Trump Administration. Nothing has changed in the ten years since the 2008 crash except that the motivation for keeping the crash hidden is quickly disappearing.

Crashes are inevitable, but collapse is only possible when the public remains unprepared. Our civilization and its values are under attack, but they can only be destroyed if we stay apathetic to the threat and refuse to prepare for their defense.  We must adopt a philosophy of decentralization.  We need localized and self sufficient economies, as well as a return to localized production.  Beyond that, we have to prepare for the eventuality of a fight.  The fate of the US economy has already been sealed, but the people who are destroying it can still be stopped before they use the collapse to force society into subservience.  We have to offer security, we have to offer alternatives to the “new world order” and we have to remove the globalist threat permanently.

Make no mistake, we are living in the midst of an epoch moment; the outcome of collapse depends on us and our reactions. This is not the task of the next generation, it is a task for our generation. We do not have another couple of decades to take the danger seriously. The plates are not spinning, they have already dropped.