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Silver price manipulation: 'public deserves answers'
An official investigation into silver price manipulation has been going on for two years. The man who made sure the investigation went ahead has told Citywire that it's time the public heard the results.
US regulators have been urged to reveal the results of a two-year-long investigation into silver and gold price manipulation allegations. The findings are keenly awaited by investors and organisations who have been making allegations about silver and gold price manipulation for decades.
The investigation was based on a claim that large traders, like banks, had been selling huge amounts of silver on the futures market to keep prices down. A substantial short position - believed to be equivalent to 25% of the annual global mining supply of silver - was exposed during the financial crisis.
He said: 'I expect the CFTC to say something on our silver investigation within weeks. I can't pre-judge what that will be. I can't even guarantee that the agency will speak. That said, if the agency remain silent for much longer, I intend to speak out on the matter in an appropriate fashion.'
Geoffrey Aronow, a former CFTC investigator, told Citywire that there was a chance the investigation could affect silver prices: 'I would say that, generally speaking, results of investigations have not had direct market impacts, but it may depend on whether the Commission concludes that there is any ongoing questionable conduct.'
Ben Davies, chief executive of Hinde Capital, a london-based gold hedge fund manager, said that the CFTC investigation and actions taken by gold and silver investors had helped recent increases in silver prices. He said that this had curtailed the activity which had raised the original concerns about silver price manipulation, adding that a further direct effect on the price of silver was unlikely.
Back in March 2010 Chilton suggested that CFTC investigators had made significant discoveries: 'We have looked at the silver market like we have never before and I think there is a window of success that has been opened for understanding about what has been going on and why.'
In the statement he said this was the first full investigation into the silver market since 1979 when the Hunt brothers cornered the market and the silver price spiked.
However the product manager of ZKB's physical gold exchange traded fund, suggested that concerns about the global gold and silver markets had motivated significant investments. He said that clients liked the Switzerland-based ZKB ETF because ZKB was the product's sole market maker which minimised reliance on global gold markets.
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