John Edmonds, a former vice president at JPMorgan Chase bank, may be headed to prison for cheating clients and investors. But metals investors can hope it won’t be before he is done helping federal investigators catch even bigger fish.
Edmonds pleaded guilty to spoofing precious metals markets “hundreds of times with the knowledge and consent of his immediate supervisors” last October.
The court delayed sentencing for those crimes again last week, and that is a very good sign.
The move to delay implies that Edmonds is still assisting the Department of Justice’s investigation of other bankers, both within JPMorgan and elsewhere. It is the second time sentencing has been postponed.
On the surface, it is starting to look like the case will be a slam dunk.
Widespread and illegal price manipulation by the bullion banks is no longer a theory. It is a fact. Market watchers, such as Ted Butler and GATA, have been aggregating extensive evidence of price rigging for years.
Despite all that, metals investors should avoid counting any chickens before they hatch.
Many will recall the CFTC spent years looking for manipulation in the silver market. The investigation ended in 2015 without a single banker being held to account. The huge pile of evidence now available reveals just how much CFTC officials had to overlook.
No one should overestimate the competence of federal investigators or the willingness of senior government officials to prosecute powerful Wall Street bankers.
However, gold bugs can at least hope the Department of Justice is not completely captured. The cozy relationship between market regulators, including the CFTC, and Wall Street is infamous. There is less of a revolving door between the FBI and Wall Street.
The Justice Department’s criminal inquiry isn’t the only concern for the bullion banks. Investors are lining up to sue in civil court, based on the evidence uncovered in the ongoing crime investigations.
Those civil cases have been placed on hold by the court until May 31st. Prosecutors have asked the court to delay those cases to avoid interference. According to CNBC, the Department of Justice will soon request an extension of the stay on civil suits.
Plaintiffs are likely more than willing to delay, hoping to take full advantage of additional evidence unearthed in the criminal investigations.
If a number of traders, including senior executives in multiple banks, are convicted of repetitive cheating over several years, the civil liability could be enormous.
War is widely thought to be linked to economic good times. The second world war is often said to have brought the world out of depression, and war has since enhanced its reputation as a spur to economic growth. Some even suggest that capitalism needs wars, that without them, recession would always lurk on the horizon. Today, we know that this is nonsense. The 1990s boom showed that peace is economically far better than war. The Gulf war of 1991 demonstrated that wars can actually be bad for an economy.
Just because cryptocurrency is having a bad time of it doesn’t mean crypto thieves aren’t thriving: On the contrary, they’ve managed to nab at least $1.2 billion in the first quarter of this year alone, according to CipherTracecybersecurity firm. That figure includes outright theft from crypto exchanges and complicated digital scams.
The price of gasoline is rapidly rising, economic activity is slowing down, the Middle East appears to be on the brink of war, and Democrats are trying to find a way to remove a Republican president from office. In many ways, 2019 is starting to look a lot like 1973. For many Americans, the 1970s represent a rather depressing chapter in U.S. history that they would just like to forget, but the truth is that if we do not learn from history it is much more likely that we will repeat our mistakes. And without a doubt, right now a lot of things are starting to move in a very ominous direction.
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