Precious Metals Market Report – 12.8.11

6 Comments

1. In regards to Franklin’s comments on Silver and Gold breaking below the recent trading range (I think he said 1700 for gold and 31.50 for silver). It now being Monday and Silver and Gold have broken to the down side is there a guess to how low the moves could go?

   thanks for any help
   Dan

2. >>LA City Council vote to support constitutional amendment against corporate personhood; What happens in the process of a constitutional amendment; Will American’s enjoy the right to own and build private equity in private enterprises when this is over?

   Catherine, could you elaborate on how you see this proposed amendment as a problem? How else can the deleterious effects of unlimited campaign contributions by corporations be mitigated? Do you have any other proposed citizen responses to the issue of free speech rights for corporations? As pointed out by Aaron Russo in “America: From Freedom to Fascism”, this original idea was added to a Supreme Court ruling in 1898. Citizens United was only a reinforcement.

   How would this amendment be subverted into eliminating private equity in private enterprises?

3. Sorry about the above post, I messed up the html tagging – see below for content:

   The MF Global story is scary when you consider that the missing $1.5 billion was from customer brokerage accounts. To make matters worse, it looks like the account holders are the last ones to be paid upon bankruptcy. Senior creditors come first, including JPMorgan Chase. Now Chase is trying to block customers in their quest to get repaid, see story below from NY Post:

   “Mf Global’s burned commodity customers turned their ire from Jon Corzine to Jamie Dimon yesterday after MF’s creditor committee, led by Dimon’s JPMorgan Chase, objected to a plan to distribute $2.1 billion to customers who have seen their accounts frozen since Halloween.

   “In a Manhattan bankruptcy court filing, the creditors committee, which also includes Bank of America and hedge fund Elliott Management, said they want more assurances that the $2.1 billion is not their money. Among their requests: They want customers to agree in writing that the money they receive could be clawed back.
   http://www.nypost.com/p/news/business/dimon_eyes_clawback_kREEfrYWIbA84Om6j2kKmK

   This from Karl Denniger (Market Ticker):

   Now pay very careful attention, because part of the bankruptcy “reform” law in 2005 placed derivative claims in front of depositors in a business failure – including a bank failure.

   “What JP Morgan is claiming in the MF Global case is that the derivative trade (which is exactly what a “Repo to Maturity” trade is – it’s a derivative) is entitled to preference in the case of MF Global over those who had cash there for safekeeping either as a margin deposit or just as free cash as you would hold free cash in a bank.

   “If a major bank blows up this very same claim, supported in existing Bankruptcy Law with the changes signed by George Bush in 2005, will be used to steal the entirety of your bank account, and if you detect the impending blowup shortly before it happens — say, 90 days before — you’re still exposed to the risk through clawback!

   “I have often referenced how that “reform” law in 2005 was used to screw you blind as a consumer, all under the name of the “ownership society” and “responsibility.” The truth is that this “reform” law was a raw example of financial rape that was intended to and did assault you, the common consumer in America, for the explicit purpose of benefiting large financial institutions.

   “Don’t run any crap about FDIC insurance in this sort of event either — in the singular case of Bank of America we’re talking about $77 trillion in face value of derivatives. While “notional” values are wildly beyond what anyone would have to pay (as that figure assumes the reference all goes to a literal value of zero) the fact remains that with even a 5% loss the amount of money required would be roughly equal to the entire US Federal Budget, which the FDIC clearly does not have — nor could it acquire.
   http://market-ticker.org/akcs-www?post=198650

   I think the bottom line may be, and any comments would be appreciated, do not use banks that have derivative accounts. And, do not use only one brokerage account. One thing that might help would be using a brokerage firm that does not trade with their own accounts. I’m thinking that it may be that discount brokerage firms might be safer – assuming they are not exposing customer accounts to the market/claw-back via trading.

   Larry Larkin

   P.S. – At the end of the interview, Catherine discusses centralized control of the global financial system. There is a great article regarding this topic “The Federal Reserve Cartel: Part 1; The Eight Families” — http://theintelhub.com/2011/12/07/the-federal-reserve-cartel-part-i-the-eight-families/

4. The MF Global story is scary when you consider that the missing $1.5 billion was from customer brokerage accounts. To make matters worse, it looks like the account holders are the last ones to be paid upon bankruptcy. Senior creditors come first, including JPMorgan Chase. Now Chase is trying to block customers in their quest to get repaid, see story below from NY Post:

   http://www.nypost.com/p/news/business/dimon_eyes_clawback_kREEfrYWIbA84Om6j2kKmK

   This from Karl Denniger (Market Ticker):

   http://market-ticker.org/akcs-www?post=198650

   I think the bottom line may be, and any comments would be appreciated, do not use banks that have derivative accounts. And, do not use only one brokerage account. One thing that might help would be using a brokerage firm that does not trade with their own accounts. I’m thinking that it may be that discount brokerage firms might be safer – assuming they are not exposing customer accounts to the market/claw-back via trading.

   Larry Larkin

   P.S. – At the end of the interview, Catherine discusses centralized control of the global financial system. There is a great article regarding this topic “The Federal Reserve Cartel: Part 1; The Eight Families” — http://theintelhub.com/2011/12/07/the-federal-reserve-cartel-part-i-the-eight-families/

5. Connie:

   Thanks for your question. Both Franklin and I are confident in silver as a long term investment, as we discussed this evening. Will post more on this by next week.

   Catherine

6. Thank you for all your precious information on your precious metal reports.

   My daughter has invested in silver one- ounce ingots and I have invested in uncirculated silver dollars dating back to 1885 until 1930’s. We started saving about 10 years ago when the price was right. We are keeping our stash hidden from wandering eyes and sticky fingers.
   We see the value going down and wonder if we should “just hang on” until this crisis is over. (if ever it will be Over)

   Thank you and god Bless,
   Connie

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