In 2014, Switzerland\u2019s financial regulator (FINMA) found \u201cserious misconduct\u201d and a \u201cclear attempt to manipulate precious metals benchmarks\u201d by UBS employees in precious metals trading, particularly with silver. Reuters reported<\/a>:<\/p>\n Swiss regulator FINMA said on Wednesday that it found a \u201cclear attempt\u201d to manipulate precious metals benchmarks<\/strong> during its investigation into precious metals and foreign exchange trading at UBS \u2026<\/p><\/blockquote>\n And the UK\u2019s Financial Conduct Authority found that Barclays manipulated the price of gold for a decade<\/a>, sending \u201cbursts\u201d of sell orders to manipulate the market<\/a>.<\/p>\n Gold and silver prices have been \u201cfixed\u201d in daily conference calls by the powers-that-be<\/a> for a long time.<\/p>\n Bloomberg reported<\/a> in 2013:<\/p>\n It is the participating banks themselves that administer the gold and silver benchmarks.<\/p>\n So are prices being manipulated? Let\u2019s take a look at the evidence. In his book<\/a> \u201cThe Gold Cartel,\u201d commodity analyst Dimitri Speck combines minute-by-minute data from most of 1993 through 2012 to show how gold prices move on an average day (see attached charts). He finds that the spot price of gold tends to drop sharply around the London<\/a> evening fixing (10 a.m. New York time). A similar, if less pronounced, drop in price occurs around the London morning fixing. The same daily declines can be seen in silver prices from 1998 through 2012.<\/p>\n For both commodities there were, on average, no comparable price changes at any other time of the day. These patterns are consistent with manipulation in both markets.<\/p><\/blockquote>\n The big banks aided Unaoil in bribing governments worldwide<\/a> to manipulate oil prices.\u00a0 The Age notes<\/a>:<\/p>\n Bankers in New York and London have facilitated Unaoil\u2019s money laundering \u2026.<\/p><\/blockquote>\n The European Commission says oil prices have been manipulated for many years<\/a>.<\/p>\n And many<\/a> commentators<\/a> note<\/a> that big banks play a big role in the mediation.<\/p>\n The big banks and government agencies have been conspiring to manipulate commodities prices for decades<\/a>.<\/p>\n The big banks are taking over important aspects of the physical<\/em> economy<\/a> \u2013 including uranium mining, petroleum products, aluminum, ownership and operation of airports, toll roads, ports, and electricity<\/a> \u2013 tomanipulate market prices<\/a>.<\/p>\n And they are using these physical assets to massively manipulate commodities prices \u2026 scalping consumers of many billions of dollars<\/em> each year<\/a>. (More from Matt Taibbi<\/a>, FDL<\/a> and Elizabeth Warren<\/a>.)<\/p>\n Goldman Sachs and Wells Fargo admitted<\/a> this week that they fraudulently manipulated the mortgage and mortgage backed securities markets.<\/p>\n Indeed, the entire housing bubble which crashed in 2007 was caused by manipulation<\/a>.<\/p>\n The big banks committed massive and pervasive fraud both when they initiated mortgage loans and when they foreclosed on them<\/a> (and see this<\/a>).<\/p>\n And they pledged the same<\/em><\/strong> mortgage multiple<\/em><\/strong> times to different<\/em><\/strong> buyers. See this<\/a>, this<\/a>, this<\/a>, this<\/a> andthis<\/a>. This would be like selling your car, and collecting money from 10 different buyers for the same car.<\/p>\n Bloomberg reported<\/a> last September:<\/p>\n The same analytical technique that uncovered cheating in currency markets and the Libor rates benchmark [details below] \u2014 resulting in about $20 billion of fines \u2014 suggests the dealers who control the U.S. Treasury market rigged bond auctions for years, according to a lawsuit.<\/p>\n <\/p>\n ***<\/p>\n <\/p>\n The plaintiffs built their case against the 22 primary dealers who serve as the backbone of Treasury trading<\/strong> \u2014 including Goldman Sachs Group Inc., JPMorgan Chase & Co. and Morgan Stanley \u2014 using data from Rosa Abrantes-Metz, an adjunct associate professor at New York University who has provided expert testimony in rigging cases.<\/p>\n <\/p>\n Her conclusion: More than two-thirds of a certain type of Treasury auction appear to have been rigged<\/strong>. She found issues with other auctions, too.<\/p>\n <\/p>\n ***<\/p>\n <\/p>\n Treasury traders at some banks learn of customer demand hours before auctions, and were communicating with their counterparts at other firms via chat rooms as recently as last year, Bloomberg News reported earlier this year.<\/p>\n <\/p>\n ***<\/p>\n <\/p>\n Among the lawyers representing the investors is Daniel Brockett, a Quinn Emmanuel attorney who recently won a $1.87 billion settlement against Wall Street\u2019s largest banks in a case alleging they conspired to limit competition in the market for credit-default swaps.<\/p>\n <\/p>\n ***<\/p>\n <\/p>\n Another group of investors, including Boston\u2019s public employee retirement system, has filed a similar suit against Wall Street primary dealers. Experts interviewed by Labaton Sucharow LLP, the law firm that filed that suit, analyzed auctions and the market for when-issued securities, which are essentially agreements to buy or sell Treasury bonds, notes or bills once they\u2019re issued.<\/p>\n <\/p>\n They claim that banks colluded to push prices artificially low at auctions, and to drive prices for when-issued securities to artificially high levels, until December 2012, when news broke of investigations into how Libor was set.<\/p>\n <\/p>\n \u201cThese scenarios all turn on a very simple conflict of interest,\u201d attorney Michael Stocker said in a telephone interview. \u201cYou had banks who were auction participants who also had the power to move the prices that those markets depended on.\u201d<\/p><\/blockquote>\n High-frequency trading has also long been used<\/a> to manipulate the treasury market.<\/p>\n It has long been known that currency markets are massively rigged<\/a>. And see this<\/a>, this<\/a>, and this<\/a>. Indeed, not only do the banks share confidential information with each other<\/em> \u2026 they also shared it with a giant oil company<\/em><\/a>.<\/p>\n A number of giant banks pleaded guilty<\/em> to manipulating currency markets, and agreed to pay a $7.5 billion dollar fine. New York\u2019s state financial regulator called it<\/a> \u201ca brazen \u2018heads I win, tails you lose\u2019 scheme to rip off their clients.\u201d<\/p>\n The formal admissions by the banks include<\/a> a trader saying, \u201cWe trying to manipulate it a bit more in ny now . . . a coupld buddies of mine and I.\u201d And a vice president of a big bank said:<\/p>\n Runaway derivatives \u2013 especially credit default swaps (CDS) \u2013 were one of the main causes<\/a> of the 2008 financial crisis. Congress never fixed the problem, and actually made it worse<\/a>.<\/p>\n The big banks have long manipulated derivatives<\/a> \u2026 a $1,200 Trillion<\/em> Dollar market<\/a>.<\/p>\n Indeed, many trillions of dollars of derivatives are being manipulated in the exact same same way <\/a>that interest rates are fixed (see below) \u2026 through gamed self-reporting<\/a>.<\/p>\n Reuters noted<\/a> in 2014:<\/p>\n A Manhattan federal judge said on Thursday that investors may pursue a lawsuit accusing 12 major banks of violating antitrust law by fixing prices and restraining competition in the roughly $21 trillion market for credit default swaps<\/strong>.<\/p>\n <\/p>\n ***<\/p>\n <\/p>\n \u201cThe complaint provides a chronology of behavior that would probably not result from chance, coincidence, independent responses to common stimuli, or mere interdependence,\u201d [Judge] Cote said.<\/p>\n <\/p>\n The defendants include Bank of America Corp, Barclays Plc, BNP Paribas SA, Citigroup Inc , Credit Suisse Group AG, Deutsche Bank AG , Goldman Sachs Group Inc, HSBC Holdings Plc , JPMorgan Chase & Co, Morgan Stanley, Royal Bank of Scotland Group Plc and UBS AG<\/strong>.<\/p>\n <\/p>\n Other defendants are the International Swaps and Derivatives Association and Markit Ltd, which provides credit derivative pricing services.<\/p>\n <\/p>\n ***<\/p>\n U.S. and European regulators have probed potential anticompetitive activity in CDS<\/strong>. In July 2013, the European Commission accused many of the defendants of colluding to block new CDS exchanges from entering the market.<\/p>\n ***<\/p>\n \u201cThe financial crisis hardly explains the alleged secret meetings and coordinated actions,\u201d the judge wrote. \u201cNor does it explain why ISDA and Markit simultaneously reversed course.\u201d<\/p><\/blockquote>\n In other words, the big banks are continuing to fix prices for CDS in secret meetings \u2026 and have torpedoed the more open and transparent CDS exchanges that Congress mandated.<\/p>\n The managing director at Graham Fisher & Co. (Joshua Rosner) said that the big banks are frontrunning CDS trades \u2026 and manipulating decisions<\/a> on whether a the party \u201cinsured\u201d by CDS has defaulted on its obligations, thus triggering an \u201cevent\u201d requiring payment on the CDS.<\/p>\n By way of analogy, whether or not an insurance company pays to rebuild a house which has burned to the ground may turn on whether it finds the fire was arson or accidental.<\/p>\n This is a big<\/em> deal \u2026 while hundreds of thousands of dollars might be at stake in the home fire example, many tens or even hundreds of billions<\/em> of dollars ride on whether or not a country like Greece is determined to have suffered a CDS-triggering event.<\/p>\n Rosner notes:<\/p>\n The potential use of CDS to artificially manipulate corporate solvency, the imbalances in the amounts of CDS outstanding relative to referenced debt and ongoing allegations that ISDA\u2019s Determinations Committee is deeply conflicted and \u201coperates as a quasi-Star Chamber or cartel<\/strong>\u201d, are finally being scrutinized.<\/p>\n <\/p>\n As one source recently suggested, \u201cIt would be a surprise if determinations of default, made by a committee of interested parties, don\u2019t lead to findings of manipulation similar to those found in LIBOR and FOREX\u201d.<\/p>\n <\/p>\n ***<\/p>\n <\/p>\n The fact that Pimco\u2019s Chief Investment Officer criticized the determination that Greece had not triggered its CDS, even though Pimco was part of the unanimous vote making that determination, is profoundly troubling to say the least.<\/p>\n <\/p>\n ***<\/p>\n <\/p>\n The fact that the [ISDA\u2019s Determinations Committees] has no obligation to \u201cresearch, investigate, supplement or verify the accuracy of information on which a determination is based\u201d and members \u201cmay have an inherent conflict of interest in the outcome of any determinations\u201d only adds credence to suggestions that the \u201cCDS market is being manipulated and gerrymandered by the all-powerful investment banks\u201d.<\/strong><\/p><\/blockquote>\n Energy markets are manipulated as well \u2026<\/p>\n The U.S. Federal Energy Regulatory Commission says that JP Morgan has massively manipulated energy markets in California and the Midwest<\/a>, obtaining tens of millions of dollars in overpayments from grid operators between September 2010 and June 2011.<\/p>\n And Pulitzer prize-winning reporter David Cay Johnston noted<\/a> in 2014 that Wall Street is trying to launch Enron 2.0.<\/p>\n And the Senate\u2019s Permanent Subcommittee On Investigations found<\/a> that Enron itself<\/em> (which massively manipulated<\/a> energy markets) was enabled by the fraud<\/a> of big banks such as Citigroup and Chase.<\/p>\n (And as noted above, oil prices are manipulated.)<\/p>\n Bloomberg reported<\/a> in 2014:<\/p>\n Royal Bank of Scotland Group Plc was ordered to pay $50 million by a federal judge in Connecticut over claims that it rigged the London interbank offered rate<\/strong>.<\/p>\n <\/p>\n RBS Securities Japan Ltd. in April pleaded guilty to wire frauda s part of a settlement of more than $600 million with U.S and U.K. regulators over Libor manipulation, according to court filings. U.S. District Judge Michael P. Shea in New Haventoday sentenced the Tokyo-based unit of RBS, Britain\u2019s biggest publicly owned lender, to pay the agreed-upon fine, according to a Justice Department statement.<\/p>\n <\/p>\n Global investigations into banks\u2019 attempts to manipulate the benchmarks for profit have led to fines and settlements for lenders including RBS, Barclays Plc, UBS AG and Rabobank Groep.<\/strong><\/p>\n <\/p>\n RBS was among six companies fined a record 1.7 billion euros ($2.3 billion) by the European Union last month for rigging interest rates linked to Libor. The combined fines for manipulating yen Libor and Euribor, the benchmark money-market rate for the euro, are the largest-ever EU cartel penalties.<\/p>\n <\/p>\n Global fines for rate-rigging have reached $6 billion since June 2012 as authorities around the world probe whether traders worked together to fix Libor, meant to reflect the interest rate at which banks lend to each other, to benefit their own trading positions.<\/p><\/blockquote>\n To put the Libor interest rate scandal in perspective:<\/p>\n Traders with high-tech computers can manipulate stocks<\/a>, bonds, options, currencies and commodities<\/a>. And see this<\/a>.<\/p>\n The big banks and other giants manipulate numerous markets in myriad ways<\/a>, for example:<\/p>\n And the big banks engaged in pervasive criminal behavior as well, by engaging in shenanigans such as:<\/p>\n The experts say that big banks will keep manipulating markets unless and until their executives are thrown in jail for fraud<\/a>.<\/p>\n Why? Because the system is rigged to allow the big banks to commit continuous and massive fraud, and then to pay small fines as the \u201ccost of doing business\u201d. As Nobel prize winning economist Joseph Stiglitznoted<\/a> years ago:<\/p>\n \u201cThe system is set so that even if you\u2019re caught, the penalty is just a small number relative to what you walk home with.<\/strong><\/p>\n The fine is just a cost of doing business. It\u2019s like a parking fine<\/strong>. Sometimes you make a decision to park knowing that you might get a fine because going around the corner to the parking lot takes you too much time.\u201d<\/p><\/blockquote>\n Indeed, Reuters points out<\/a>:<\/p>\n Switzerland\u2019s regulator FINMA ordered UBS, the country\u2019s biggest bank, to pay 134 million francs ($139 million) after it found serious misconduct in both foreign exchange and precious metals trading. It also capped bonuses for dealers in both units at twice their basic salary for two years<\/strong>.<\/p><\/blockquote>\n Capping bonuses at twice base salary? That\u2019s not a punishment \u2026 it\u2019s an incentive<\/em>.<\/p>\n Experts say that we have to prosecute fraud or else the economy won\u2019t ever really stabilize<\/a>.<\/p>\n But the government is doing the exact opposite. Indeed, the Justice Department has announced it will go easy on big banks<\/a>, and always settles prosecutions for pennies on the dollar (a form of stealth bailout<\/a>. It is also arguably one of the main causes of the double dip in housing<\/a>.)<\/p>\n Indeed, the government doesn\u2019t even force the banks to admit any criminal guilt<\/a> as part of their settlements. In fact<\/a>:<\/p>\n \u201cThe banks have been allowed to investigate themselves,\u201d<\/strong> one source familiar with the investigation told Reuters. \u201cThe investigated decide what they want to investigate, what they admit to, and how much they will pay<\/strong>.<\/p><\/blockquote>\n Wall Street has manipulated virtually every other market as well \u2013 both in the financial sector and the real economy<\/a> \u2013 and broken virtually every law on the books<\/a>.<\/p>\n And they will keep on doing so until the Department of Justice (or We the People) grows a pair.<\/p>\n The criminality and blatant manipulation will grow and spread and metastasize \u2013 taking over and killing off more and more of the economy \u2013 until Wall Street executives are finally thrown in jail.<\/p>\n It\u2019s that simple \u2026<\/p>\n\n
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<\/div>\nThe Oil Market Is Manipulated<\/h3>\n
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Other Commodities Are Manipulated<\/h3>\n
The Mortgage Market Is Manipulated<\/h3>\n
Banks Rig Treasury Market<\/h3>\n
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Banks Rig Currency Markets<\/h3>\n
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Derivatives Are Manipulated<\/h3>\n
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Energy Prices Manipulated<\/h3>\n
Interest Rates Are Manipulated<\/h3>\n
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Everything Can Be Manipulated through High-Frequency Trading<\/h3>\n
Manipulating Numerous Markets In Myriad Ways<\/h3>\n
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The Big Picture<\/h3>\n
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