Today I’d like to discuss the feedback received so far to my recent writings on Bank of America’s dealings in precious metals, tripped off by disclosures in the Office of the Comptroller of the Currency’s recent quarterly reports on OTC derivatives positions. I started out, nearly a month ago discussing the silver derivatives position of BofA and just a few days ago, broadened the discussion to include gold. By the way, I did make public a portion of Saturday’s review –

The reaction to my disclosures and conclusions has been two-fold. One, includes some doubt of my contention that BofA had actually borrowed and short sold 800 million oz of silver because the amount was so large so as to be near-incredible and that perhaps the category included gold. I tried to make clear that gold is not part of the OCC’s precious metals derivatives category, so unless someone would contend that BofA’s precious metals derivatives position is heavily weighted with palladium or platinum positions, the $18.3 billion position would seem to amount to more than 800 million oz of silver.

Other objections along this same line of thought included whether the position represented a short sale of silver, or instead might represent positions not related to a pure short sale of 800 million oz. Because the OCC report is not transparent in this regard, I was forced to give my best interpretation of what the position represented (considering many factors away from the OCC report), but was quick to add that the simplest remedy to this was a disclosure from the OCC and/or the Bank of America to explain what accounted for a 100-fold or 10,000% increase in its precious metals category in 18 months?

To my knowledge, no such explanation has been forthcoming and I’ve had no choice but to provide the most plausible explanation as I see it. Certainly, I’ve heard no disagreement that a 100-fold or 10,000% increase in a very specific derivatives category is not normal or customary or that there has ever been such an astounding increase in any other derivatives category. The OCC compiles and reports such data presumably to guard against any unusual signs of potential trouble to an individual bank or the financial system as a whole. If a 100-fold increase in one category in 18 months doesn’t trigger some alarms in the OCC, then what the heck would?

The second type of feedback I’ve received was, by far, much greater than any technical questions/doubts about the data. Overwhelmingly, just about everyone has concluded that the US Government is behind and has orchestrated everything connected with the highly unusual developments I’ve reported on and it’s not possible, for instance, that Bank of America could be as dumb as I claim for its involvement.

One subscriber wrote just this morning about this in a most compelling manner, incorporating many of the things that I’ve claimed, such as the Justice Department backing away from lowering the boom on JPMorgan for the bank’s long-term manipulation of silver and gold in its recent $920 million fine and deferred prosecution agreement out of fear of what it would do to JPM and the financial system should JPM be adjudged for the long-term manipulation I’ve always claimed.  Instead, the subscriber, Paul, argued that the DOJ ordered JPM to dispose of its ill-gotten physical metal position in silver and gold.

This is hardly an argument I could disagree with, since I made this very same argument early on in trying to explain the sudden inflow of hundreds of millions of ounces of silver into the ETFs in the spring of 2020, before coming to the conclusion that the flows were due to a lease/short sale. Admittedly, it had to be one or the other.

Truth be told, I’m just kicking myself that it took me so long to discover the same thing happened in gold, namely, the 30 million oz physical inflow into the COMEX gold warehouses also had to be either a DOJ-ordered forced disposal of the metal from JPMorgan or a cleverly-arranged lease with the dumb bunnies at BofA. So, there you have it – this whole thing, the long-term manipulation of silver and gold prices is an either/or – it’s either been orchestrated by the US Government or, at least since 2008, by JPMorgan for its own benefit.

In the interests of full-disclosure, I still lean to it being a JPMorgan-run affair and not masterminded by the US Government due to how smart (and crooked) I believe this bank to be and those same feelings not being felt about the USG. I have always been of the opinion that while the USG was not the originator of the silver manipulation, it (through the CFTC and DOJ) had argued for so long that no such manipulation existed that it became trapped in perpetuating the lie. How does a government agency, the CFTC, ever admit it screwed up on its most important mission – guarding against manipulation – for more than 35 years? The simple answer is that it can’t. But that’s different from orchestrating the manipulation for decades.

As far as Bank of America being as dumb as I portray it to be, I still lean that way. After all, no one would argue that the last great fiasco with precious metals leasing/short selling some 20-odd years ago, involved many bullion and central banks and mining companies all operating in the dumbest of ways – first causing the price of gold and silver to be artificially depressed for years and then, when the dumb and manipulative practice ended, caused prices to soar. Looking back, no one could argue that all the many parties were as dumb as dirt for engaging in the fraudulent practice of metals leasing and short selling.

With this in mind, how hard is it to believe that on this go-around with precious metals leasing/short selling involving only two banks, on one side the acknowledged master financial criminal of our time, JPMorgan, and on the other side a relative babe in the woods when it came to precious metals, Bank of America; that JPM hoodwinked BofA?  Back around the turn of the century, many turned out to be dumb, this time only one appears to hold that distinction. I would further contend that only a bank with no prior experience in precious metals leasing/short selling could possibly fall for this scam.

Regardless, the important point, aside from it having to be one or the other, either a USG or JPMorgan arranged affair, is that one or the other has caused the price of gold and, especially, silver to be depressed in price despite overwhelming evidence to the contrary from the real world of actual supply and demand. The question is what to do about it.

My main interest over what is now approaching 4 decades is to expose and end a manipulation I discovered in silver on a challenge. Admittedly, the manipulation is still in force, so my efforts to date have not been successful. On the other hand, while I miscalculated how long it would take to see the end of the silver manipulation – don’t laugh, but I actually believed the CFTC and exchanges would quickly fix the matter of the concentrated short position on the COMEX after I pointed it out to them – there can be no doubt that the silver manipulation premise has taken full hold on those most interested in silver (and gold).

This can be seen in many ways, from the rapidly shrinking number of silver manipulation deniers to the growth of large numbers of those holding that silver is manipulated, such as the Reddit/WallStreetSilver crowd. There may be disagreements as to who is behind the manipulation – the USG or JPMorgan and other assorted COMEX vermin – but absolutely no disagreement that silver is artificially suppressed in price. I can tell you from personal experience, once you come to see that silver has been artificially suppressed in price, there is no going back. You may give up or die, but once you have been enlightened to the manipulation, you won’t – can’t – go back to any thought that silver is a free market.

While the silver (and gold) manipulation is with you forever once you’ve become enlightened to it and that even lower prices will not dissuade you otherwise, it is also a fact that as a percentage of the overall investing public, the numbers of silver investors are very small. Therefore, it’s hard to garner the attention of elected officials, which generally concern themselves with issues involving the greatest number of potential voters. (This also argues against a government-orchestrated silver manipulation, apart from a coverup for past malfeasance). But even here, I’ve found success in writing to elected officials when you keep it tight and narrowly focused – just don’t intend to write to your senator or congressman about some wild and vague conspiracy – stick to specific facts, like Bank of America’s 100-fold increase in precious metals derivatives in 18 months.

The whole purpose of this piece was to provide some interim input from me as to what the reaction has been so far to my recent writings on Bank of America. To this point, I am highly encouraged by the feedback in that there has been no real challenge to the facts and data as I have presented them. The overwhelming response has been to who has been behind the facts and data – essentially, either the US Government or JPMorgan. Hopefully, we’ll come to learn who it was and is someday. In the interim, regardless of who is behind these extraordinary developments, the unmistakable conclusion is that silver and gold prices have been artificially manipulated and that’s what matters most.

As far as my contention that Bank of America was as dumb as dirt for getting into this position and the OCC was just as dumb and incompetent for reporting the data without questioning what the data meant – all I know is that if anyone accused me of being that dumb, I would respond. Let’s see what BofA and the OCC do or don’t do. As far as JPMorgan, I guess it doesn’t mind being called the crook that it is, as I suppose that’s better than being called dumb.

Let’s not lose track of what’s really important. If silver and gold prices have been artificially suppressed as I allege and so many have come to accept on their own or otherwise, with disagreements confined to who exactly is behind the price suppression, then there has to be agreement that the flip side to the suppression must be an over-reaction in price higher. How long that will take is anyone’s guess, but it seems to me that if all those embracing the manipulation became more unified in pressing the case, the sooner the scam ends.  Of course, as time goes by, I intend to offer specific advice on appropriate actions to take.

Turning to other developments, there has been a surge in silver deposits into the big silver ETF, SLV, following last week’s highly counterintuitive one day withdrawal of 4.2 million oz. Over the past two days, more than 11 million oz have been deposited into the SLV, the silver ETF everyone seems to hate.

Obviously, price action has been punk this week, at least as I write this – shortly before the Fed something or other in a short while. After the Fed speaks, prices will get crushed further or go the other way – whatever is more suitable to the commercial crooks on the COMEX.

In the meantime, as far as what to expect in this Friday’s COT report, it seems certain that there will be a substantial deterioration (managed money buying and commercial selling) in gold positioning, due to the simple fact that gold prices advanced sharply this reporting week, up by more than $40 to new multi-month highs on increasing total open interest of nearly 33,000 contracts. It would be a miracle for there not to be net positioning changes of close to that amount. Any such deterioration allows for significant price downdrafts and may account for today’s weakness. I suppose it’s just in my DNA, but I always see gold price weakness as designed to add price pressure to silver.

In silver, price action was more mixed, with the first two days of the reporting week featuring a sharp rise, up to the 200-day moving average, followed by three days of price weakness, although prices did end higher by around 40 cents or so for the reporting week, on a total increase in open interest of around 3000 contracts. No real guess on my part for silver, except to note that the price action this week was almost the mirror-image of the prior reporting week, when silver was much stronger pricewise than was gold.

So far, the price reaction to what the Fed has or is saying has not yet made a dramatic difference in gold or silver, but these things can turn on a dime. I find the whole exercise somewhat annoying because it’s never what the Fed says or doesn’t say, but how the COMEX scamsters wish to maneuver prices. Scratch that, it now appears the Fed said something very negative to gold and silver prices, or the COMEX crooks would have us believe. As I prepare to send this, gold is down around $30 for the day and $16 since Friday. Silver is down about 25 cents for the day and a sharper 70 cents since Friday.

In terms of the 8 big short’s results, the decline in prices since Friday puts their total running loss at $9.3 billion, nearly $600 million less than where it stood on Friday.

Ted Butler

January 26, 2022

Silver – $23.65       (200 day ma – $24.67, 50 day ma – $23.16, 100 day ma – $23.31)

Gold – $1820          (200 day ma – $1805, 50 day ma – $1809, 100 day ma – $1796)

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