JP Morgan Secretly Stockpiles Silver and Gold—Blood Money

By Dominique de Kevelioc de Bailleul

Leave it to Max Keiser to pick up on the Silver Doctors article, titled, “Is JP Morgan Shorting Paper Metals While Acquiring Massive Physical Stockpiles?

If Keiser, who himself appears to have once been a clever and scheming juvenile delinquent, believes the article’s supposition reeks of the devil’s sulfur, there may be more than a sliver of truth in it.

The Silver Doctors cite Jim Sinclair, ‘Mr. Gold’, who has said two things which would most likely prove to be foolhardy not to believe.  One, that the Fed would embark on “QE to infinity.”  And, two, the bullion banks would amass the lion’s share of the bull market profits in the rise in gold and silver prices.

The first looks like a done deal.  The second will most likely pan out as well, which takes us back to the Silver Doctors article.

The ‘Doc’ goes on to quote, David R, a veteran bullion trader, who has traded at the desks at AIG, Barclays, and UBS.

They [JP Morgan] buy the physical silver at the same time they sell the future (on Comex) futures trade in contango (higher price than spot physical) they get zero interest rate cash from FED so borrow the money for free, they own the vaults to store the silver…. so as the future comes to maturity they can either settle against their physical long or roll the future to collect more free contango…. This is pure arbitrage paid for by the FED.  This has been going on for over 30 years and why shouldn’t they be allowed to have 25% of the Open Interest?  There is no manipulation because they are short the futures and long the physical and have “ZERO” price risk, but nice profits!  It’s brilliant trading and completely 100% legal and that’s why they will never be charged with manipulation because there is none going on. Sometimes it’s just that easy!

Of course, it’s that easy.  Banks make money on spreads on every damn thing they touch.  But as Ted Butler and the fine folks at GATA have argued: when a single trader becomes dominate within a single market, it’s size, alone, affects price discovery.  That is, indeed, illegal, going back to the late 19th century—a time when the U.S. faced some of the nasty side-effects of an industrial revolution gone unfettered.

The man who fought the monopolists of the early 20th century, armed with the Sherman Anti-Trust Act of 1890, Teddy Roosevelt, must be rolling in his grave at the suggestion that JP Morgan’s “brilliant trading” is “perfectly legal,” as trader David R. suggests.  In fact, there’s nothing brilliant about JP Morgan’s criminal activity in the bullion markets.  The scam is not new; it’s as old as the hills.

According to Wikipedia, the lead author of the Sherman Anti-trust Act, Ohio Republican Senator John Sherman said the purpose of the Act was “to protect the consumers by preventing arrangements designed, or which tend, to advance the cost of goods to the consumer.”

In the case of the silver market, the cost to the consumer is inflation—in everything, especially in those things consumed each day for survival.  If the bullion markets are suppressed to give the U.S. dollar an advantage over the competition—bullion, the Fed can create more dollars, thereby forcing holders of the commodity (the dollar) to take a purchasing-power loss.

And with the latest mortality statistic revealing that more deaths in America come from suicide than from the result of an automobile accident, one must have to wonder how many of these suicides were the result of extraordinary bad economic times.

Another author of the Act, Senator George Hoar of Massachusetts, said, an entity that “merely by superior skill and intelligence…got the whole business because nobody could do it as well as he could was not a monopolist …(but was if) it involved something like the use of means which made it impossible for other persons to engage in fair competition.”

By the way, after the 1890 U.S. Senate ratified the Sherman Anti-Trust Act by a vote of 51-1, the House unanimously passed the bill with a vote of 242-0 on Jun. 20, 1890.

Can anyone image today’s Congress taking such a stand against the largest cancerous tumor of them all, JP Morgan?  Of course not.  Maybe Gerald Celente’s latest suggestion to boycott the upcoming general election is as good as Max Keiser’s suggestion to buy as much silver as one can.

The bottom line to the JP Morgan bullion prices suppression scheme is, if bullion prices reflected the weakness of the U.S. dollar, the Fed would have to stop printing them.  Congress would be forced to make the tough decisions regarding the public account, and the wrongs can be righted more quickly with less, much, much less pain—and most likely less suicides, too.

It’s been said, “Evil knows no boundaries.”  That evil is the Fed’s no. 1 stockholder, JP Morgan.  How Alan Greenspan, Jamie Dimon, Robert Rubin, Lloyd Blankfein and the other Den of Thieves can sleep at night is another puzzle for another time.  There’s a lot of blood on their hands, and for one, Blankfein, appears to have no idea why his hands are stained red.  What an anthropomorphic example of a living and thriving cancer.

God have mercy on these pathetic and perfect examples of humanity’s worst.

Little Doubt! $3,500 Gold Price, a Minimum

By Dominique de Kevelioc de Bailleul

To the ‘man on the street’, a price target of gold $3,500 must sound to him like the typical hyperbole of gold peddlers.  It must; sentiment of the gold-market-ignorant American public of the future price of gold still remains  low.

As Bill Murphy’s GATA has said, “They don’t even know how to spell gold.”

That’s because the public really has to see the effects of the Fed’s QEs.  In fact, a relatively few Americans haven’t an idea what so-called ‘quantitative easing’ truly means to him, personally, just as few understood similar Fed monetary practices orchestrated by Arthur Burns and William Miller during the inflation-roaring ’70s.  But he sure will see how inflation is eroding his lifestyle in the coming months—starting with a much higher oil price, and his coincidental savior, gold.

But something convenient for the monetary ‘authorities’ just happened.

A day before Bernanke pulls the trigger on indefinite purchases of mortgage-back debt, anti-American sentiment suddenly flares up in the Middle East and North Africa.

Coincidental?

The thinking behind the “there’s no such thing as a conicidence” may be driven by the assumption that Bernanke and his handlers knew that during the aftermath of the collapse of Lehman, AIG and the rest, the talking point, that the threat of another dip in the housing market will lead the U.S. economy into ‘deflation’ can only be told for so long.  Bernanke knew that food and energy prices are poised to soar faster than these dollar-sensitive ‘things’ rose during the 1970s.

Thinking that the Fed believes its own BS regarding the living costs of the average American reveals profound ignorance of the Fed’s real mandate, especially at this late stage of the Kondratiev debt cycle.  That mandate is: to protect its member banks.

And protected they will be.  With the Fed coming in at the last moment to cope with the mess at JP Morgan and Morgan Stanley, the effects of an addition of $1.3 trillion (estimated by the close of calendar year 2013) expansion of the central bank’s balance sheet in the coming months will necessitate a new mantra from the Fed and MSM to now explain rapidly increasing food and energy prices during a global recession.

This time, China, alone, can no longer be blamed for stubbornly high oil prices.  Its economy is dropping like a stone, too.  Therefore, a new scapegoat for the future price of $150 to $200 per barrel of oil will emerge in the Middle East and North Africa, instead.  It will be called, either the “Arab Fall” or “WWIII”.

With the latest Fed announcement, it should be abundantly clear by now: the Fed is intentionally debasing the dollar, and it appears that the central bank will continue to debase the dollar until it fears a currency collapse—a course that Ron Paul said is a “detachment from reality,” after hearing of the press release of Fed’s FOMC meeting decision, Friday.

The Fed lives in reality, and it knows what it’s doing many months ahead of a carefully coordinated plan of public distraction.

There’s little doubt; gold will take off and begin the final stage of this tremendous secular rally.  Today’s low sentiment among mom and pop for holding gold will change this year and accelerate in 2013, taking gold to great heights.  Gold has reached new highs against the Indian rupee and near-highs priced in euros.

As far as the dollar, an ultimate price target for the gold price of $2,000 will turn out to be much, much too low.  It’s much more likely that Egon von Greyrz’s target price of $3,500 to $5,000 within 18 months will make much more sense, in retrospect.

Here’s why.

The following chart provides a rational for a target gold price of $3,500.

As an example of the Swiss economist and money manager Marc Faber comments about the effects of inflation, the chart (above) shows that inflation doesn’t manifest in all markets at the same time.

In the chart, the data show inflation had flowed into the oil market months following the peak in the gold price at the end of 2011 through to today.  The expected next rally in the gold-to-oil ratio is poised to test the Aug. 2011 high of 24.  But, instead of oil surging while gold was coming off its Apr. 2011 all-time high, today, both ‘commodities’ are expected to move much higher as a result of QE++, with the gold price outperforming the oil price by a considerable clip.

With predictions of a minimum oil price of $150 as a result of the Fed’s new QE-to-no-limit plan (to north of $200 in the event of an attack on Iran) and the multiple of the all-time high gold-to-oil ratio of 24 applied to the oil price, the gold price calculates to $3,600.  In the event of a $200 per barrel handle, $the target price moves up to $4,800.

U.S. Intelligence Suspected of Killing CFTC Silver Manipulation Case Against JP Morgan

By Dominique de Kevelioc de Bailleul

“Four-year silver probe set to be dropped,” FT titles its piece Monday regarding the JP Morgan silver manipulation scandal.

According to FT:

A four-year investigation into the possible manipulation of the the silver market looks increasingly likely to be dropped after US regulators failed to find enough evidence to support a legal case, according to three people familiar with the situation. . .

In 2010, Bart Chilton, a CFTC commissioner, said that he believed there had been “fraudulent efforts” to “deviously control” the silver price.

But after taking advice from two external consultancies, the first of which found irregularities on certain trading dates that it believed deserved more analysis, CFTC staff do not have sufficient evidence to bring a case, according to the people familiar with the situation.

Though Ted Butler, GATA and Andrew Maguire have provided the ‘watchdog’ agency with a drivers licenses of the suspects, a video tape of the incidents, the address of the assailants and the usual time they sit down for dinner, two mysterious “external consultants” believe that the “CFTC staff do not have sufficient evidence to bring a case.”

Therefore, the refusal of the CFTC to hand over the ‘smoking gun’ evidence to the U.S. Department of Justice in the JP Morgan case is no longer the issue for silver bugs to seek relief; the issue now becomes: Why won’t charges ever be filed against Jamie Dimon?

On May 5, 2006, then-President George W. Bush essentially handed over Wall Street, COMEX and CME to the Director of National Intelligence (DNI), a spy agency created in Dec. 17, 2004.  In essence, with the signing of the Intelligence Reform and Terrorism Prevention Act of 2004, anything that truly matters in the financial markets ultimately has no democratic oversight to protect market participants.

From the Business Week article of May 2006 (no longer available online):

Intelligence Czar Can Waive SEC Rules

Now, the White House’s top spymaster can cite national security to exempt businesses from reporting requirements.

President George W. Bush has bestowed on his intelligence czar, John Negroponte, broad authority, in the name of national security, to excuse publicly traded companies from their usual accounting and securities-disclosure obligations. Notice of the development came in a brief entry in the Federal Register, dated May 5, 2006, that was opaque to the untrained eye.

AUTHORITY GRANTED. William McLucas, the Securities & Exchange Commission’s former enforcement chief, suggested that the ability to conceal financial information in the name of national security could lead some companies “to play fast and loose with their numbers.” McLucas, a partner at the law firm Wilmer Cutler Pickering Hale & Dorr in Washington, added: “It could be that you have a bunch of books and records out there that no one knows about.”

The memo Bush signed on May 5, which was published seven days later in the Federal Register, had the unrevealing title “Assignment of Function Relating to Granting of Authority for Issuance of Certain Directives: Memorandum for the Director of National Intelligence.” In the document, Bush addressed Negroponte, saying: “I hereby assign to you the function of the President under section 13(b)(3)(A) of the Securities Exchange Act of 1934, as amended.”

A trip to the statute books showed that the amended version of the 1934 act states that “with respect to matters concerning the national security of the United States,” the President or the head of an Executive Branch agency may exempt companies from certain critical legal obligations. These obligations include keeping accurate “books, records, and accounts” and maintaining “a system of internal accounting controls sufficient” to ensure the propriety of financial transactions and the preparation of financial statements in compliance with “generally accepted accounting principles.”

Knowing how the National Security Agency (NSA) has worked in the past, it, also, should not be too surprising that the ‘smoking gun’ witness to JP Morgan’s blatant manipulation of the silver market, Andrew Maguire (and his wife), was attacked by a hit man in a hit-and-run car assault the day following his damaging testimony against JP Morgan at a CFTC hearing of Mar. 25, 2010.

Here’s where the DNI may have stepped in to squash the CFTC investigation into JP Morgan and, possibly, took action to permanently squash Andrew Maguire, too.

At the time of the attack on Maguire, the highly-controversial Admiral Dennis C. Blair was on duty as director of national intelligence (Jan. 29, 2009 – May 28, 2010).

The U.S. economic collapse “already looms as the most serious one in decades, if not in centuries,” Blair told the Senate Intelligence Committee on Feb. 12, 2009.

“Time is probably our greatest threat,” Blair added. “The longer it takes for the recovery to begin, the greater the likelihood of serious damage to U.S. strategic interests.”

Nearly a year later, Feb. 3, 2010, Blair testified again before Congress, and said, “If that direct action–we think that direct action will involve killing an American, we get specific permission to do that. … I would rather go into details in closed session, Mr. Chairman, but we don’t target people for free speech. We target them for taking action that threatens Americans or has resulted in it.”

Blair added, “Being a U.S. citizen will not spare an American from getting assassinated by military or intelligence operatives overseas if the individual is working with terrorists and planning to attack fellow Americans.”

Those two ‘external consultants’ who ‘advised’ the CFTC to drop the case against JP Morgan may have come from the DNI, citing national security interests, of course.

And as far as Andrew Maguire, it may have been a pure coincidence that the director of national intelligence at the time of his hearing with the CFTC was a loose cannon, Blair, a possible psychopath.  Was the DNI behind the hit-and-run of Andrew Maguire and his wife?

For more information on Blair’s checkered past, including disobeying direct orders, suspicions of perjury and other dishonorable accusations, read about him on Wiki.

Silver Manipulation: CFTC v. Dollar Hegemony

By Dominique de Kevelioc de Bailleul

If the silver community expects satisfaction out of CFTC Commissioner Bart Chilton and his ‘colleagues’ at the commodities future trading ‘watchdog’, don’t expect any!  Get it out of your mind.

As a reminder, the Silver Doctors published an email of Bart Chilton’s response to their inquiries into the matter of the silver manipulation investigation—as in, why is it taking so damn long to resolve?!  In short, Chilton stated he expects the results of the investigation will be released by Oct. 1, 2012.

Why nothing will happen?

A fraudulent financial system is predicated upon a continuation of the fraud—a la Ponzi scheme.  Simple.  Ergo, no action will be taken by the CFTC against JP Morgan, and the manipulation will continue, though kind words or sympathy most assuredly will come from CFTC’s sympathetic good cop, Bart Chilton.

“I empathize with you on your loss; I really do, but thank you for being a lovely contestant on Fascism, the game.”

Ted Butler, Bill Murphy, Chris Powell and Adrian Douglas at GATA are good people, doing the right thing for noble reasons.  The silver community owes each one of these men sincere gratitude, but they are outnumbered by a pack of suit-wearing psychopaths, not by the CFTC, but from the financial system oligarchs and Washington politicos who have naturally teamed together to form a fascist state.

Nothing will come out of the CFTC’s investigation regarding the manipulation of the silver market.

Obvious demonstrations of what GATA is dealing with can easily be gleaned by the cast of social misfits and genetically defective masses of human flesh already well-know to us.  How about Bernie Madoff?  And MF Global’s Jon Corzine, JP Morgan’s Jamie Dimon, Goldman’s Lloyd Blankfein, U.S. Treasury Secretaries Timothy Geithner and Hank Paulson, politicians George W. Bush, Dick Cheney, Donald Rumsfeld, William & Hillary Clinton and Barrack H. Obama as well as many others yet to be discovered by the public as racketeering mobsters tied to Washington’s one-party cabal—and that’s just on the American side.

“Psychopaths have what it takes to defraud and bilk others: They are fast-talking, charming, self-assured, at ease in social situations, cool under pressure, unfazed by the possibility of being found out, and totally ruthless,” wrote Andrew M. Lobaczewski Ph. D., Polish psychiatrist and author of Political Ponerology: The science on the Nature of Evil Adjusted for Political Purposes.

According to Amazon’s introduction of the book, Political Ponerology, another capo of the Washington/Wall Street syndicate tried to suppress its publication.

Amazon: The first manuscript of this book went into the fire five minutes before the arrival of the secret police in Communist Poland. The second copy, reassembled painfully by scientists working under impossible conditions of repression, was sent via a courier to the Vatican. Its receipt was never acknowledged, no word was ever heard from the courier – the manuscript and all the valuable data was lost. The third copy was produced after one of the scientists working on the project escaped to America in the 1980s. Zbigniew Brzezinski suppressed it.

Political Ponerology was forged in the crucible of the very subject it studies. Scientists living under an oppressive regime decide to study it clinically, to study the founders and supporters of an evil regime to determine what common factor is at play in the rise and propagation of man’s inhumanity to man.

Shocking in its clinically spare descriptions of the true nature of evil, poignant in the more literary passages where the author reveals the suffering experienced by the researchers who were contaminated or destroyed by the disease they were studying, this is a book that should be required reading by every citizen of every country that claims a moral or humanistic foundation. For it is a certainty that morality and humanism cannot long withstand the predations of Evil. Knowledge of its nature, how it creates its networks and spreads, how insidious is its guileful approach, is the only antidote.

If psychopaths and war criminals in control of America & Companies, Inc. are willing to kill innocent American citizens, Iraqis, Afghans, Sudanese, now Syrians, and soon-to-be Iranians, in the face of every human law of decency—not to mention dozens of U.N. treaties and other sanctioned rules of international conduct—what causes someone to think that the very financial system, founded upon global U.S. dollar hegemony, will be threatened by a complaint from the CFTC?

The source of funding of the U.S. military and its role as protector against any threat to said system will be crushed.  Saddam Hussein and Muammar Gaddafi threatened the petrodollar system, and they got crushed.  What chance do Ted Butler and the good guys at GATA have against the most powerful fascist state the world has ever seen and the individuals in power who are willing to kill to protect the U.S. dollar?

Commissioner Bart Chilton, I’m sure, is already aware of the powerful cabal behind the manipulation of the price of silver and doesn’t stand a chance of making a difference either.  The issue is a matter of ‘national security’.

Swiss Bank Copies MF Global Fraud, Averts Disaster

When James Turk, Marc Faber, Eric Sprott and Gerald Celente say get your gold out of the hands of bankers, each one of these men isn’t hyping the gold trade.

Consider Switzerland, a nation which relies on customer trust of its banking system for a substantial portion of its Gross Domestic Product (GDP), and which holds approximately 28 percent of all funds held outside of the jurisdiction of the funds’ origins (The Boston Consulting Group Global Wealth 2009), committing a fraudulent disclosure of a highly sensitive financial product.  That’s what happened to a well-heeled customer of an unnamed Swiss bank charged with storing the customer’s physical gold bullion, according to Egon von Greyerz, founder of Switzerland’s Matterhorn Asset Management.

“We are stressing to investors to take their gold out of the banking system, not only because there are runs on banks that will continue, but the risk of being in the banking system is major,” von Greyerz told King World News.  “So you should take the additional step of not just owning physical gold, but also owning it outside of the banking system.

“We (just) had an example of a client moving a substantial amount (of gold) from a Swiss bank to our vaults, and we found out the bank didn’t have the gold. This was supposed to be allocated gold, but the bank didn’t have it.  We didn’t understand why there was a delay (in our vaults receiving the gold), but eventually we found out why there was a delay (the bank didn’t have the gold).  It’s absolutely amazing, but not surprising.”

Reminiscent of another landmark breach of fiduciary trust in the U.S., regarding one of the Fed’s primary dealers MF Global and Gerald Celente’s gold futures account, the revelation of banking fraud has moved to Switzerland. But fortunately, the Swiss bank in question scrambled to find the gold—and was successful acquiring the bullion for its customer—this time.  Though, in the case of Celente, he still hasn’t been made whole from his missing ‘allocated’ brokerage account held at MF Global.  And the gold he contracted for delivery was credited to JP Morgan’s books, instead.

“Every financial institution is under the same kind of pressure as we see in Europe. If you think your money is safe with any of those big names, you’re making a big mistake,” Forbes Magazine quoted Celente in an InfoWars.com interview of Nov. 17, 2011, more than two weeks after MF Global’s Oct. 31 bankruptcy.

“When I say take your money out of the banks and put it under the mattress, this is not advice,” Celente said, reminding listeners of the interview that he is not a registered investment adviser.  “Personally, I buy gold coins from reputable companies. I take my money out of investment funds and I buy gold and silver. You need the three g’s — gold, guns and a get-away plan.”

Celente has stated numerous times that, not only bank cash accounts, but bullion stored within the banking system should be withdrawn and held at fee-for-service storage facilities—such as private bullion storage vaults—or home safes.

Cracks in the physical gold market can be anticipated, according to CFTC testimony from one of the gold market’s leading apologists of JP Morgan’s suspicious derivatives trading, Jeff Christian, founder of commodities consulting firm CPM Group, though Christian’s statements weren’t expressed clearly to the layman.  Note: Jeff Christian once worked for Goldman Sachs, another firm suspected of rampant fraud in the derivatives market for mortgage-back securities.

“The CFTC, when it did its most recent report on silver, used the term that we use, ‘the physical market.’ We use that term, as did the CFTC in that report, to talk about the OTC market — in other words, forwards, OTC options, physical metal, and everything else,” Christian told CFTC Chairman Gary Gensler in a Mar. 25, 2010 testimony, admitting to the Commission that the CFTC weekly reports regarding physical inventories at the COMEX includederivatives.  Emphasis added.

Gold Anti-Trust Action Committee (GATA) Director Adrian Douglas provided one of the most powerful testimonies at the CFTC hearing, when he pointed out the enormous size of paper gold in the market (led by JP Morgan’s derivative desk) and the tacit implication that physical gold allegedly held for unsuspecting clients across the globe may not exist, including gold allegedly stored in Swiss banks in alleged ‘allocated’ accounts.  In other words, there’s approximately one ounce of gold for many times more paper gold, which, if called for delivery, could force another MF Global incident anywhere in the world.

“ . . . if we look at the physical market, the LBMA, it trades 20 million ounces of gold per day on a net basis, which is $22 billion,” Douglas told the CFTC.  “That’s $5.4 trillion per year. That is half the size of the U.S. economy. If you take the gross amount, it is about 1 1/2 times the U.S. economy. That is not trading 100-percent-backed metal; it’s trading on a fractional-reserve basis.”

And, on Monday, CFTC Chairman Gary Gensler has opened another investigation into JP Morgan’s derivatives trading losses from activities its CEO Jamie Dimon initially said where executed as hedges, according to Dow Jones Newswire.  However, Bloomberg has confirmed that Dimon has since retracted his statement regarding the type of trading activities that resulted in a substantial loss.

“Commodity Futures Trading Commission Chairman Gary Gensler said the agency had opened an investigation into JP Morgan Chase’s trades, which have resulted in a more than $2 billion in losses so far, but declined to comment on the specifics of the probe,” stated Dow Jones Newswires.

The full extent of the losses and ramifications of the red ink at America’s largest Fed primary dealer to the global banking system are not yet known.  Speculation of banks calling in gold to sell it into the marketplace to remain liquid run rampant.   von Greyerz’s statement to King World News only serves to escalate nervousness among investors to run to physical bullion in the gold market.

‘Mr. Gold’ on Gold: Toughen Up! Forge Ahead!

As an apparent gesture to lend a helping hand to Sprott Asset Management John Embry’s call for seasoned gold professionals to coach rosy-cheeked newcomers through the treacheries of the gold market, as witnessed so far this month, Mr. Gold, Jim Sinclair, posted an Open Letter for the weak-of-heart among his flock to ignore mainstream media, stare down that empty-chambered pistol of the Fed, and “forge ahead.”

“Please make an effort to stay balanced. Greed is a condition of lack of balance similar to fear,” the 40-year gold market veteran Sinclair stated in his Open Letter of May 16.  “Fear is being fanned from within the gold community as much or more than from outside. When people who know gold is seriously under priced talk temporary bear, they kick good people when they are down.”

Echoing Embry’s comments in an interview with King World News (KWN) on May 15, Sinclair directed the reader’s attention to the heart of the financial crisis—the more than $1 quadrillion worth of derivatives, armed and ready to explode anywhere, and at any time.  And sure enough, the most likely culprit of reckless trading of those synthetic time bombs (by assets held), JP Morgan, last week began warning the bank’s stockholders of a $2 billion loss from its “hedging” activities for the current quarter.

And not surprisingly, this week, Bloomberg reports the loss estimate at the nation’s largest bank now stands at $3 billion—creeping higher over time—which has become a familiar pattern among the banks of, first, low-balling the initial announcements, then ratcheting up to the true losses incrementally by the time of quarterly reporting.

Bloomberg’s Dawn Kopecki said on Bloomberg Television’s ‘Inside Track‘ that JP Morgan’s initial estimate of a $2 billion loss from its European mortgage bonds trading represents only the “tip of the iceberg,” and that Jamie Dimon’s characterization of the trades as a “hedges” is a lie.  Under FASB rules, the loss is the result of a gamble, not a hedge, and Dimon knows it.  Therefore, can shareholders trust Dimon’s estimate of the total trading loss?

“The problems of OTC derivative just brought into the headlines by Morgan is alive and well, guaranteeing QE to infinity,” Sinclair continued—as he again reminds his flock of the JSMineset.com mantra: “QE to infinity.”  And as the banks trade in wild speculation in an attempt to dig themselves out of the derivatives hole, Dimon and his banking cohorts know the Fed will bail them out if they lose the bets.

And again, it appears Sinclair is correct.  The “QE to Infinity” works like a charm.

Thursday, Bloomberg reports the Fed Minutes of the April FOMC Meeting, which revealed that several Governors said further money printing will be forthcoming if the U.S. economy stalls or if “downside risks to the forecast became great enough,” signaling to traders in its typical obfuscatory language that the Fed fears an exploding derivatives market and that the European solvency crisis will take down the financial system in another Lehman-like swan dive.  It’s ready to open the money spigots.

“You must make your decision in present time, neither fearful or greed-ful of the future,” Sinclair said.  “Look at every factor of gold and list them as bullish or bearish.”

One of the many of the gold market’s bullish factors comes out of Asia, where GoldCore executive director Mark O’Byrne told Bloomberg the appetite has not waned during the entire decade-long gold bull market.

“There has been significant buying particularly out of Asia in recent days,” said O’Byrne.  “In Hong Kong and Singapore there have been reports of tightness in the marketplace and premiums have remained robust on gold buyers of those markets.

“So, this has been a pattern we’ve seen for the past 10 years—that the Asian markets seem to be a little bit more price sensitive and they tend to buy . . a little bit more savvy on their buying, and they tend to buy on the price dips as we’ve seen in the past 10 years.”

Given the 10 years of professional gold buying out of Hong Kong (China’s supplier of overseas gold) and Singapore on significant pullbacks, Sinclair told KWN on April 2 that the only remedy for the amateur jitters is to . . . well . . .  “toughen up” and trust that “everything that you are doing you are doing for good, right and logical reasons.”   That’s what Asian professional buyers are doing.