In the wake of the Gold Flash Crash six days ago in which prices suddenly plunged then recovered, numerous people have been wondering "who is the culprit".
Will the Real Manipulator Please Stand Up?
At the top of the heap in demanding an investigation is a guest post article on ZeroHedge, written by Russ Winter, Open Letter to Gold Investors: Will the Real Manipulator Please Stand Up.
Winter maintains "The real debate should center on who is really conducting this gold attack activity. Financial journalists should be looking at this as well."
I am amused by this kind of waste of time, but even more amused by the details that Winter disclosed.
The Commodity Futures Trading Commission’s most recent banker participation report on positions as of Dec. 1 shows the U.S. banks as four participants. They are not identified by name, but historically and deductively, JP Morgan is the largest and most dominant participant. Over the last quarter this report has shown that the four big banks have continued to build a net-long position, now at 57,408 futures contracts, or 5.741 million ounces."
So is JP Morgan the short manipulator of gold as some suggest? At one time perhaps, but now I believe the answer is unequivocally “no” and, in fact, the complete opposite. JP Morgan and the three other U.S. banks have a large net-long position equal to nearly 15% of Comex open interest.
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