For the JPM Apologists

There has been a lot of negative Silver sentiment out there lately. 

A lot of the JP Morgan apologists point to another set of stellar results as proof that they are not the big Silver short. 
Sorry, the bigger and more complex the company the easier it is to hide, twist and generally make the numbers say whatever you want. It's called creative accounting. Good numbers from JPM mean as much as good numbers from Enron, Greece or any Irish Bank. They have already proven to be dishonest when it comes to accounting even to themselves. (See my post on JPM and their recent settlement in Mass)

Larry Edleson makes the argument that the big boys are taking us for a ride. Run that sucker up and hide the metal in Switzerland etc. thereby creating an artificial shortage. Then as all the fools rush in to buy that silver then you dump all the metal into their waiting arms. Cha-Ching!
It's possible of course. Much like it's possible JPM are neutral or even long on Silver but then if true then their execution sucked. It really, really sucked as they ran it too high too fast and then let the price drop like a rock. Sorry Larry it doesn't even pass the first smell test.


GM Jenkins said...

JP Morgan's financial results are evidence not proof. Remember this Adrian Douglas article that came out a few months ago:

"In analyzing the Annual reports of the major bullion banks I made some astonishing discoveries. For most of these banks their bullion banking business is entirely hidden from the accounting. In the text there is almost no mention of gold, silver, bullion, or precious metals. In fact it is impossible to know that these banks are even in the bullion banking business let alone know anything about their trades, assets and liabilities. "

I assume Adrian Douglas stands by his claims here, though I'm surprised his discovery didn't get more mileage. It seemed pretty big at the time

Louis Cypher said...

Good one GM. I forgot about that article.
I studied Accountancy many moons ago and know first hand balance sheets rarely reflect reality. The layman would assume it's simplistic and should reflect basic common sense. Adding and subtraction should be pretty straight forward. Nothing could be further from the truth.

Yukon Cornelius said...

I like the fact that the silver sentiment has been so negative. It was far far too bullish leading up to the recent drop off. The short term technicals might have been badly bruised but this makes the long term much more solid and stronger in my mind.

You also forgot another strategy called the "Give them enough rope to let them hang themselves" strategy. You let the big boys think they're taking us for a ride, and you let them dump all the silver wrecking the market at which point you quickly snatch it up and monetize it.

There's simply so many directions and plans withing plans with this that the entire point of having so many directions is to pull you off of the main path. As long as they continue to debase currencies and in effect steal from the savers out there I'll continue to hold and hedge paper with physical. It's just that simple.