Gold Stock Fortunes Update: The Impact of Silver Manipulation on Prices

There has been a lot of talk about manipulation in the silver market. One particular issue is spoofing and market manipulation have indeed been proven to be real in the silver market.

In August 2023, two former JP Morgan precious metals traders were found guilty of spoofing trades in the silver market. They were sentenced to two years and one year in custody and fined $50,000 and $30,000, respectively. Their actions took place over an eight-year period from 2008 to 2016 and are believed to have caused about $10 million in damages to other traders across the silver, gold, platinum, and palladium futures markets.

It’s essential to note that $10 million over eight years for a trading desk like JP Morgan’s is minimal. The Department of Justice’s report indicates that several other traders, along with the two defendants, engaged in market manipulation. Moreover, between 2008 and 2016, silver saw significant bull and bear markets, rallying from $10 to $50 and then back to around $14. These large market movements suggest that the manipulation may not have had a significant impact. In reality, market spoofing may only result in small fluctuations in trades and is unlikely to alter the market’s overall direction. The major bull and bear trends during that period support this perspective.