Just a day after Deutsche bank admitted to gold and silver price rigging, two class action lawsuits seeking $1 billion in damages on behalf of Canadian gold and silver investors were launched in the Ontario Superior Court of Justice. This is just the tip of the iceberg, as there will no doubt be U.S.-based lawsuits on the way.
The really interesting aspect is that Deutsche bank agreed to “cooperation in pursuing claims” against other banks, i.e., exposing the manipulation of other cartel members. With the spotlight on bank manipulation of precious metals’ prices and increased scrutiny of these practices, one might expect an end or at least a reduction in the price manipulation that has plagued the precious metals’ market for years.
I am not so naive as to believe that government regulatory agencies will really punish the banks in any meaningful way. After all, the government also has a stake in maintaining the legitimacy of the fractional reserve fiat monetary system. It enables and sustains their power, both domestically and internationally. Investors agree, as shares of Deutsche (DB) are up over 2% today and up 11% in the past week.
However, if this case does at least end the manipulation of gold and silver at Deutsche bank, this alone would have an impact on prices. And at minimum, one would assume these recent revelations would dissuade other banks from continuing to manipulate the gold and silver prices. It would then make sense to expect an upward revision in prices.
Deutsche Bank AG’s head of global foreign exchange, Ahmet Arinc, is on leave, according to people with knowledge of the situation.
Furthermore, China is expected to start their Yuan-based gold price fix this week. As price discovery continues moving from the West to the East, one would expect the banks ability to manipulate prices to wane.
COMEX Gold Positions Reach Extreme Levels
Even prior to the Deutsche bank admissions, speculative gold longs increased their positions to the highest levels since August of 2011 (when gold hit an all-time high). On the other side of things, commercial traders recently increased their shorts to the highest levels since February of 2013.
COMEX gold speculators have rarely been more bullish than last week and silver speculators have NEVER been more bullish. This is now the fourth new record in six months for gross long silver position according to CFTC data.
This is setting up the futures market for an explosive move when one side of the trade is forced to blink. Given the action in the gold and silver markets so far in 2016, I believe the direction of that move will likely be to the upside.
Saudi Arabia Threatens to Wreck U.S. Economy by Dumping Treasury Holdings
Adding to potentially bearish news for the dollar and bullish news for gold, Saudi Arabia has reportedly threatened to liquidate its treasury holdings if Congress probes its role in the September 11th attacks in New York City.
Saudi Arabia is the owner of the world’s third largest USD reserves, behind only China and Japan. Adding to the intrigue, the actual composition of Saudi Arabia’s USD holdings remains a secret. While the US discloses the explicit Treasury holdings of all other nations, Saudi Arabia’s holdings, for some unknown reason, are not officially disclosed.
This begs the question… Who will monetize the US deficit if relations between Washington and Riyadh hit the skids? China and Russia have already been reducing their U.S. treasury holdings in recent years. If the FED is faced to monetize the debt as buyer of last resort to keep the government from running out of money, the value of the dollar could finally plummet.
Saudi Arabia, owned by the Saud family, are telling the U.S. Government, they’ll wreck the U.S. economy if a bill in the U.S. Congress passes. This bill would remove the unique and exclusive immunity that the royal owners of that country enjoy in the United States against being prosecuted for their having financed the 9/11 attacks.
The Saud family’s Foreign Minister is “telling