For years I have agreed with Ted Butler - that the silver short position is a "Company Killer". Ted has shown how it has been passed from Drexel Burnham to AIG to Bear Stearns to JP Morgan and now, as JP Morgan begins to stumble, it seems the transition is happening once again. Each and every time the company holding the short has IMPLODED in a heap of rubble.
Since the 1st quarter of 2012 there have been some basic changes in the market structure of those that hold the manipulative silver shorts. I'm not talking about the COMEX short but rather the Over the Counter Derivative market that is recorded at the Office of the Comptroller of Currency of the United States. Although it's true that JP Morgan's position has increased from $16.4B to $18.5B by July 1st there is a brand new manipulative short in the game...
...believe it or not it's the Poster Child for government bailouts CITIBANK!
According to the OCC, Citibank has increased their exposure to silver derivatives MASSIVELY over the first two quarters of 2012. Here's the fact - on table 9 (PREC METALS is mainly Silver):
1/1/2012 $44 million
3/31/2012 $5.7 Billion
6/30/2012 $9.5 Billion
At $35/oz the $9.5B represents 270M ounces of silver derivatives added in the first 2 quarters of 2012.
Remember, it was March 2012 when JP Morgan's troubles began in their derivative book with the "London Whale". The rumors are that these derivatives are linked to silver. This is the same time that Blythe Masters had to come on TV to declare that they don't rig the silver market. This is also the same time that Citbank began to build it's monument to silver derivatives rapidly catching up to JP Morgan.
It is clear to me that the baton of silver rigging is once again getting passed on. The next report will be very telling if Citi continues to build this monstrosity to silver market manipulation.
UPDATE: Looks like the Citibank rig job may have to end early as it was just announced that the CEO and COO have just abruptly stepped down! More on this as events transpire.
My the Road you choose be the Right Road.