JP Morgan and the Massive Silver Short: The Greatest Story Ever Told
Kid Dynamite
SeekingAlpha, 10 December 2010
Let’s take a step back and start with some facts, and perhaps we can then figure out where the facts morphed into Internet Folklore Legend. First of all, JP Morgan is being investigated by the CFTC (Commodity Futures Trading Commission) for alleged manipulation of the silver market. Second, JP Morgan is a large player in the precious metals derivatives markets. Third, many experts in the field estimate that the outstanding open interest in silver futures is very large relative to the actual supply of physical silver in the world. Depending on estimates, the outstanding interest in paper silver (futures and options) may be larger than the outstanding existing physical silver stocks. Finally, the CFTC has been debating instituting position limits in precious metals contracts, and is still working on that issue.
