“Wall Street's Naked Swindle”

A scheme to flood the market with counterfeit stocks helped kill Bear Stearns and Lehman Brothers — and the feds have yet to bust the culprits

MATT TAIBBI in The Rollng Stone Posted Oct 14, 2009 9:30 AM

excerpts…

…”The SEC's halfhearted oversight didn't go unnoticed by the market. Six months after Bear was eaten by predators, virtually the same scenario repeated itself in the case of Lehman Brothers — another top-five investment bank that in September 2008 was vaporized in an obvious case of market manipulation.”….

But when Bear and Lehman made their final leap off the cliff of history, both undeniably got a push — especially in the form of a flat-out counterfeiting scheme called naked short-selling….

To the rest of the world, the brazenness of the theft — coupled with the conspicuousness of the government's inaction — clearly demonstrates that the American capital markets are a crime in progress….”

None of this is news to those of us who have followed Jim Sinclair, Bill Murphy (GATA), John Embry, Chris Powell (GATA) and a host of others for ten years now. The rants and anguished echoes of beleaguered gold bugs have reverberated throughout the PM and JPM BBs for the last several years. They have been met with ridicule, scorn, anger, disbelief and described as conspiracy theorists and lunatics wearing tinfoil hats. But the evidence is becoming a little too hot for the arrogant perpetrators of the crimes. The shunning of the media, analysts, letter writers, columnists and a mob of detractors is now being lifted.

What we see in SFMI share price today is a familiar refrain across the board, with few exceptions. We have all seen the charts about how undervalued the JPMs are. How many counterfeit shares do you suppose have been cumulatively sold into these small markets alone over the past few years? Pretty easy to do with sophisticated software and dark pools of trading that can exert collective mayhem on all (or even specifically targeted JPMs). Billions and billions have been stolen from honest investors. Thus we note Jim Sinclair’s regret that so many have now thrown in the towel…at just the wrong time. Who can blame them? As Ed Steer mentioned today, many middle class seniors over 60 have lost so much in the general markets that they can not live o their investments any longer and many seek work. How terribly cruel and sad. All due to the unquenchable greed at the top. I believe their only hope rests with the PM and JPM stocks.

As Jim Sinclair last night:

“…while the short attacked the bottom half of Junior Producers and all of Gold Exploration entities. Watch closely now as a shift takes place….

No short of any viable gold share can be happy this evening even though across the board they are still short and in some cases still sitting on the price…..”

Keep the faith those of you who may be a bit disillusioned. Keep the faith. We are close and if I may say so, the SFMIs and many others will do very well indeed…very well. I can assure you that I did not come all this way to throw in the towel.