I have watched how JP Morgan has been manipulating the COMEX silver market as a direct consequence of their own shorting and short covering, and in plain sight of the same regulatory agency that bankrupted the Hunts for a far less concentrated exposure. This has pissed me off no end when I have had to put up with extended selloffs in the past that were mostly a result of the paper futures scam. Now, with the way the markets are responding, I think the corrupt regulators at the CFTC have enabled JPM just enough rope to hang themselves, and probably bust the COMEX too.

Gold has broken free of the manipulation. The takedown earlier this week has been completely stuffed because this time around the market did not behave as it usually did in the past. Rather than dump positions and run to the sidelines, the buyers just became more aggressive as the price of gold slumped in a short raid. I think this is just the first black swan that will hit the COMEX.

Silver is going to be dragged up with gold. Specs may smell blood in the water even now and begin to sense a short squeeze is coming. There is not enough silver bullion to meet even a fraction of the contracts if investors stand for delivery. A default is the only way out. JPM has been able to push the market around at will until now. I think there is a good shot the scam is going to bust this time.

They did not cover much of their outstanding short interest even on a drop of nearly $2 per ounce. Now the only way to keep that market from exploding higher is to keep shorting and try to contain it. JP Morgan may be trying to fight a fire by pouring more gas on it. This could get very interesting very quickly.

cheers!

mike