What we may be witnessing in the Silver market is a "reverse" raid on the CRIMEX. What appears to be a massive short squeeze on our criminal bankers may in fact be a coordinated effort by a disgruntled group of EX-JP Morgan traders, and their hedge fund friends, to hold JP Morgan's feet to the fire, and extract a heavy price for these traders dismissal from the hive of criminal banking.
The Friends Of Andrew Maguire [FOAM] look to align themselves as a group to punish the CRIMEX and force them to either deliver a massive quantity of Silver to them in March, or pay a heavy premium to them to keep the rigged CRIMEX game going.
FOAM have a target price of $37 Silver set for First Notice Day February 28. FOAM began their assault on the CRIMEX when price broke through $31 last Thursday. Their intent is to run price up to, and possibly through, $37 by First notice Day. If they can achieve a price of $37 or higher they will settle their long futures contracts with the Crimex at 20% premium to spot. If they fail to break the $37 barrier, they intend to actually fund their positions and force the CRIMEX to deliver Silver that FOAM believes they do not have.
With the US markets effectively closed yesterday for President's Day, Silver was run up to $34.32 in electronic trading on the NY Globex. FOAM has stated that in their efforts to run the price higher they may have to resort to the tactics of the criminal banks, and short the market, at times, themselves. They state that their short sided efforts will be quick, and in the interests of driving the price higher by squeezing the shorts already in the market as these entrenched shorts sense an opportunity to exit this massive short squeeze still standing. Those stubborn enough to remain short this market will be shown great pain if FOAM can run the price towards $37.
Last evening I came across a series of threads by an internet thread poster using the name WYNTER BENTON. This chain of threads began with a post on a Yahoo message board on January 5th, 2011 [Silver @ $29.30] as the Precious Metals began their January descent. The "message" is being sent to Blythe Masters, current head of global commodities at J.P. Morgan Chase. The message is clear and direct:
The strategy is as follows. We know that Comex only has 105 million ounces of silver of which only 50 million ounces are availabe for delivery. (I personally don't believe the Comex numbers are anywhere near that high, but that is neither here nor there for now.) Well, all it would take is 10,000 contracts on the Comex to buy up all the "available silver" at the Comex and 20,000 contracts to deplete it completely. The current front month March OI is north of 78,000.
Watch the OI closely. Blythe's former traders are advising major hedgefunds and billioniare investors to buy up as many contracts as possible as March 1 approaches and deposit the cash needed to stand for delivery for the month of March. The purpose is not necessarily to bust the Comex but to force the Comex to pay a premium (some as much as 30 percent) for cash settlement. Think about it. If a group of hedgefund gets together and bankroll $1 billion, they can buy more than 30 million ounces of silver. Of course, the contract sellers like The Morgue cant deliver the silver so a cash settlement is the only recourse. So what's wrong with $200 million in profit on a $1 billion investment that takes less than 4 weeks total?
Guess what Blythe? Your former traders are advising everyone they know to put on this trade come the first week of February. Is this what happened in the Decemeber contracts? Is this why silver went from $22 on September 30 to $29 by December 1? How much do you think silver will spike in February as we approach March 1? The traders think silver will be north of $45. Heck it went over $9 as we approached December and everyone who got a pay off in terms of a premium cash settlement will be back for more. And they are all gonna be bringing friends to partake in the bounty.
This post was followed by another post on January 26, 2011 [Silver@ $29.40]. In this post Wynter Benton explains the efficacy and the possible outcome of their plan to "reverse" raid the CRIMEX. She even says exactly when their raid on the CRIMEX banks will launch. Remind yourself whilst reading this thread, it was posted on january 26, 2011. The market has played out exactly as it was laid out here in this thread post:
Assuming a silver price of $30 and the known fact that Comex only has 105 million ounces of silver of which allegedly 50 million ounces are available for delivery, this is what hedge funds can do to earn 20 percent like they did last December.
This hedge fund would purchase over 21,000 contracts and deposit 3.15 billion dollars ($30 X 105 million ounces of silver = $3.15 billion). Once March 1 comes rolling around, guess what happens?
You got it!! Comex doesnt have the silver to deliver.
Now what? You got it again!! Cash Settlement.
What happens after March 1st? I dont really know. All I do know is that between February 15 to March 1, hedge funds will be buying a huge amount of contracts because they know the Comex cant deliver and will be forced to pay a premium or default.
What happens to the sellers of contracts who "defaults" and cant deliver the silver? BANKRUPTCY and a seizure of all assets. Period.
Either deliver the contracts that were sold or negotiate a CASH SETTLEMENT. No other choice PERIOD!!
No matter what happens after March 1, the price of paper silver will skyrocket as March 1 approaches because hedge funds will be blackmailing silver contract sellers come March 1.
How do I know this with near certainty? Because it worked so well the first time around from October to Decemeber. And back then hedge funds didnt even know Comex couldnt deliver.
That is why silver went up 81 percent in less than 4 months. Remember silver was flat for the year as late as August 23. Yet it miraculously skyrockets 81 percent by December 31 with gold going essentially flat.
Major hedge fund traders are going to be buying hundreds of millions of dollars of March contracts during the last 3 weeks of February. The strategy is simple-force Comex to pay a hefty premium on contracts that CANNOT be delivered. Will this work? It worked like a charm in December. Those guys were all kicking themselves because they should have bought 10 times the amount of contract that they actually had in December.
This time around, they are getting everyone they know to get involved in this trade. They will pool their money together in order to get a large number of contracts so that Comex will not be available to deliver-thus forcing a hefty premium. These former traders are gonna pull a train on Blythe with all their hedge fund buddies and there is not a thing Blythe can do about it.
HOWEVER THERE IS A CAVEAT!!!
These traders have gotten word in the last 48 hours, that Blythe and The Morgue is about to undertake a major raid on GOLD in the hopes that silver will sell off too. Therefore, these traders are advising their colleagues to refrain from buying March silver contracts unless silver breaks $31 again. Their understanding is that Blythe cannot effectivley execute a silver selloff but Blythe and The Morgue can still execute an effective GOLD SELLOFF.
If and when this GOLD selloff comes, scheduled for this Friday or perhaps next week at the latest, Blythe is hoping that gold will break $1300 and go as far down as $1250. Blythe will be short selling intermitently in the silver pit but her main goal is to cover as many silver contracts as possible.
Once this Gold induced selloff is done watch for the mother of all rally in the silver pit. The hedge funds will be buying like crazy, but the MAIN assault will not take place until February wheren these former traders expect a rise of at least $10 (which was what happened to silver from October going into December).
December was just a dry run (RAID) on the Comex. The success and ease of that RAID has emboldened these traders to re-try the same scheme with a lot more money this go around (March delivery). The only defense Blythe has is to engineer a GOLD SELLOFF in the next two weeks in order to suppress silver so that she can cover her SILVER contracts.
On February 9, 2011 [Silver @ 30.20] another series of thread posts by Wynter Benton are posted explaining the FOAM groups "reverse" raid on the CRIMEX in further detail. As you recall, in late January I suggested that by Feruary 4th the lows "for the year" in Silver and Gold would be in. I was only speculating based on chart technicals at the time. It would appear that the charts support the claims posted here by Ms. Benton:
But rest assured Blythe, we are coming after you in March. And we are confident that we can raise money a lot faster than you can find physical silver.
How high will you push the price of silver in February? Anthing under $40 and we might be able to bust Comex ourselves.
What we are also hearing is that shorters like The Morgue and others of their ilks are playing games with silver right now. They are slamming the paper price of silver in the pits while actively buying PHYSICAl silver all over the world. That is why you are seeing the dichotomy between the paper price and the slam down in contango. Blythe is trying to buy all the physical silver that is available while slamming the paper price so The Morgue can pick up as much as possible as cheaply as possible.
While the suck out rate has been somewhat impressive on the US Mint, the ETFs (primarily the SLV but others as well), we do not believe that she can suck out enough to prevent the raid that is about to occur on March 1.
If Blythe and The Morgue are accumulating this vast amount of silver, then you can bet everything you've got that the price of silver phyiscal or paper will be much higher as March 1st approaches. Think about it.
Blythe is buying physical silver so she can deliver to our raiders come March 1st, right? The last thing you would want is a lower silver price when you are making deliveries come March 1st. I mean why buy silver here at $27.50 and deliver the silver at a lower price. Surely you can see why the price of silver will be much higher as March 1st rolls around. A higher price will make the coming raid more difficult to execute and Blythe can actually profit on the physical silver that she must deliver on. It's so clear that this is a phony paper selldown. The physical market is signalling the beginning of backwardation.
As for our group, we will begin to accumulate in size the week of February 8 through the end of February.
But in my opinion, the low in silver has now been reached. I base this conclusion on the fact that Blythe could not puncture yesterday's low point. Not even close. Gold got blasted right through 1322 like a hot knife through butter yet silver stubbornly clung to the $27 level and was no where close to the $26.50 level. Believe me, if Blythe wanted silver to crack $26, she has the firepower to do it easily.
The reason that she didnt was because she must somehow realize that the people she was selling her Mar contracts to were going to be standing for delivery. Believe me she knows when these people are buying.
Which gets me to my original post. This whole slam down in precious metalsm was all about silver. Gold was just the unfortunate mechanism and instrument by which Blythe worked her magic. She slammed down gold because she knew eventually traders would not be able to stand for delivery in Feb. The gold market is just too big. But you can buy every ounce that the comex CLAIM to have with a mere $2.8 billion. Blythe has access to that type of money in the folds of her couch at The Morgue's HQ.
You can see clearly now why she needs to suppress the price of silver and force traders to cough up the Mar contracts. Once the slam down in gold no longer has the desired effect than it is time to abandon that strategy. My guess (and it is only that for now) is that we have seen the low for silver.
If she is at all competent, then she will be sending the price of silver up by at least $2 by Feb 8 to make it more difficult for hedgies to raid the Comex. But we'll have to see. Either way as long as hedgies and big investors cough up about $5 billion in Feb, then Blythe and The Morgue will be in a world of hurt.
I want to clear up another point. Some people are interpreting that I am predicting a default in March. That is definitely NOT what I am predicting. All I am predicting is that there will be massive contracts that will be standing for delivery and each one of these contracts will be offered a huge premiums which will be settled in cash. You see, it is always more profitable to buy the Mar contracts settle in cash and then buy the May contracts and do it all over again.
It is as if you buy $1 billion worth of silver, sell it for $1.2 billion and buy the exact same position for $1 billion again. You really don't lose anything and someone automatically gives you 20 percent and you get to keep your position exactly as it was before. Well not exactly because the equivalent May contracts are slightly more than the corresponding Mar contracts. It's up to you what you want to do with your money but since it was so easy in December, why not do it again in March and then again in May?
It's as if you show up with 1 ounce of silver, The Morgue pays you 120% of the value of your holding, and you go back into the pits and buy it back at face value. Nothing could be easier and they are defenseless to stop it.
I know for a fact that the silver shorters are desperately trying to come up with physical silver from anywhere they can get it--from the SLV, the US Mint, foreign ETFs, anywhere they can get physical silver. Too bad it still won't be enough.
So watch for February and see how high silver spikes up. This whole slam down was The Morgue trying to get people to stop hoarding silver, so keep buying physical silver and they will fail. Good luck to all physical silver holders. Our time is close at hand
Which gets us back to what will happen as March 1st approaches. The last thing that Blythe wants is for the Comex to show anywhere near 10,000 (or 20,000) contracts standing for delivery come March 1st. Even if she managed to pay enough people off and make physical delivery on a few thousand contracts, it would signal to the world that the Comex had to pay people off because they couldnt deliver the physical. That is what happened in December as Comex started paying people off in order to show only 5,200 contracts standing for delivery instead of a much bigger number. Of course, Comex only delivered on 1,845 contracts, so how would it have looked had 10,000 contracts stood for delivery?
The other way to pay people off is to spike the price of silver as March 1st approach thereby enticing people to sell and making it that much more difficult to raise the cash and stand for delivery.
In a final thread post on Feruary 18, 2011 [Silver @ $32.65], Wynter Benton lays bare the FOAM groups plans to run Silver higher after is surpasses $31 in price. She also warns of the volatility that this could create in the Silver market and that her group may actually play the role of JP Morgan at times and be in the market with "quick shorts" in an effort to enhance their position. Bottom line: If 10,000 futures contrcts stand for delivery in March, the CRIMEX will be in a world of hurt:
The general plan is to allow the public to take silver over $31.20 by itself, and then we support the move by buying underneath that move AFTER the public has taken silver above the old highs.
Our traders are NOT the ones that will be taking silver past $31 initially. However, we are buying and pruning as we approach $31 which may explain why $31 has not been breached yet.
I can say that once we break $31, it is our intention to drive the price as far away from the old highs as possible and hold it there as we approach $31. As we approach March 1st, you are correct when you say that we might short the further month contracts depending on the price. We might even stand for delivery if the price is not "high enough".
Regardless we believe that the price of silver will be much higher in the coming months, thus if you hold physical silver, our interests will always align.
Good luck to us and I hope things work out as we had hope. And another thing when I said 5 days, I meant 5 trading days so it is certainly my expectation that the supernova event will happen by Friday if all goes according to plan.
The Comex is playing rope a dope right now over-inflating the number of Mar OI (currently) and after the deadline Comex will under-report the actual number of contracts standing for delivery. This way Comex can hide the depth of its delivery problem. A poster says that Comex would bust if 8,535 contracts stood for delivery. I would arugue that closer to 6,700 contracts need to stand for delivery to bust Comex since there will be close to 9 million ounces from the Jan and Feb options that will also be standing for delivery.
What if Comex only reports say 4,000 contracts are standing for delivery come March 1 when the reality is something far higher? By doing this, Comex can fool the public into thinking that it does not have a delivery problem in March and use the month of March in order to extract physical silver to make its delivery. Either that or secretly settle for a lesser cash premium since it has convinced enough people that there isnt a delivery problem.
What is the remedy to this problem? Our group is thinking of taking delivery if the price of silver is not above $37 in March. This is the exact scenario that Comex wants to have. A game theory problem among multiple participant with imperfect information. Even if there are many hedge funds like us, if Comex can pretend that it doesnt have a problem, then it cant be blackmailed into settling for a hefty premium even though it is still in dire straits. The only remedy is for everyone to stand for delivery no matter what, either that or gain 20 plus percent on the value of the contracts in which case silver must be above $37 in March.
Our group is seriously thinking of standing for delivery if the price of silver is not over $37.
In the run up to $37 or $40 or whatever, we may at times be massively short contracts to shake out the average investors. Yes indeed, we may be taking on Blythe's role from time to time. Nothing serious, of course. Our shorts will be quick to see if we can take out some stops. From here on out, it will be very volatile and we may be in a position to take out your stops before we go long again so please be careful when setting stops. Everyone must be at their all time highs so please think of an exit strategy.
Take the time to read each thread post in it's entirety. Their predictive accuracy is astonishing. There appears to be a serious group of traders and hedge funds looking to "take advantage" of the situation at the CRIMEX regarding it's [lack of] supply of Silver. The "reverse" raid this group is attempting is purely motivated by profit, and less about actually taking delivery of physical Silver. This could appear as a game of chicken between the Silver Bears and the Silver Bulls. The Bulls appear poised to win no matter what the Bears try and/or throw at them.
In the overnight market last night, Silver peaked at 34.33 early, and a 5.5% raid was engineered by the criminal bullion banks to erase all of yesterdays electronic Globex market gains as price returned towards Friday's closing CRIMEX prices. Today is Tuesday, and the CRIMEX will be gunning to paint the Open Interest numbers today as well. It is clear that the bullion bank(s) short this Silver market are staring at themselves in the mirror and wonder how they got in this mess. Perhaps they should stare a little longer and look a little closer...arrogant SOBs.
For a brief synopsis of the trouble JP Morgan and CRIMEX banksters are facing this morning, take the time to watch this brief "fly-on-the-wall" video taken in Blythe Masters JP Morgan office:
The area between $33.25 and $33.50 is acting as a wall this morning since prices slipped overnight courtesy of our nefarious bullion bankers. The battle has raged, the war may be about to breakout here at this level. Should Silver climb back through $33.50, our JP Morgan lead bankers will be sitting on a bomb with a short fuse. The mother of all short squeezes will be upon them. Buckle up tight and reach for the sky.