06 August 2012

Curiouser and Curiouser: Bart Chilton Informs the Press About the 'Erroneous Report' on Silver

"A society becomes totalitarian when its structure becomes flagrantly artificial: that is, when its ruling class has lost its function but succeeds in clinging to power by force or fraud."

George Orwell

I am hearing from people who say they have received brief email replies from CFTC Commissioner Bart Chilton. 

Apparently if there is a move afoot to can the silver investigation without presenting any findings after four years, he has not gotten the memo.

He has informed the press about 'the erroneous story' according to emails I have seen from people who have heard from him on the matter.

If this was a front page article on the Financial Times one would hope they double confirmed it, and the sources were good. That makes this even more puzzling.

So let's see what happens. As I said in my lead sentence from last night, this could have been a 'trial balloon' to gauge the reaction and blowback if they did ditch the investigation, not wanting to expose the findings, or expose a coverup to later instances of perjury.
This leak to the FT *could* just be a 'trial balloon' by Mr. Gensler and his crew to see if they can get away with it. But that seems more like the plot of a novel.

This could be one of the best examples of the credibility trap in action. The government regulators can say nothing because of the shadow government's long term complicity.
Mr. Gensler was the assistant to Robert Rubin and Larry Summers in the 1990's and is a Goldman alumnus, where he was the right hand to Jon Corzine. It could be that Bart as a dedicated civil servant is not on the A-team.

Or this could just be the usual shenanigans that the Street likes to play with the press.

All of this highlights the problems of the credibility trap and the lack of transparency in the US markets, made especially sensitive by a shocking series of financial scandals that are repeatedly distorted and often covered up.


Mr. Chilton apparently made this statement to the editor of the SilverDoctors site.
"The Financial Times report related to silver is not only premature, but inaccurate in several respects.

Whenever the CFTC does take an action or actions related to our silver investigation, I am hopeful that we will do so in a fulsome and transparent manner. That will certainly be my desire in anything we do.

I continue to believe, consistent with my previous statements to which you referred, and based upon information from the public, that there have been devious efforts related to moving the price of silver. Incidentally, I also believe there have been silver and gold market anomalies outside of the silver investigate window that have raised, and continue to raise, market concerns.

Perhaps there will be more coverage on this matter soon."

Now I am beginning to wonder if during this 'four year investigation' that the actual window of investigation into the market was relatively short, and that there was some effort made for the market participants to behave themselves during that window.

I have seen that sort of thing happen before. The investigators, who were industry consultants, exposed the pararmeters of the study window to their market cronies. The CFTC can then say that the formal investigation was 'inconclusive' and kick the can down the road.

One hears different and sometimes disturbing things about the US regulators. I even heard that the US Treasury is discouraging a UK initiative to beef up their Serious Fraud Office, and turn it into an Economic Crimes Agency with a more effective focus and resources.

Apparently the key metric in determing investigations into economic fraud these days is political. And this is the essence of the Glenn Greenwald piece I ran last night, which is that the rule of law has been replaced by the rule of expediency, where might makes right, or at least grants special exemptions from the law.