Morgan Stanley pays damages for Precious Metals Fraud

Well, looks like what I've been predicting for years is true: the so-called "ETF" instruments supposedly backed by "real" gold and silver are nothing but more pieces of fiat paper issued by corrupt banks. In this case, Morgan Stanley has agreed to pay a fine for pretending to buy gold and silver for investors. I guess the profits from this fraud offset the fine *shrug*.

I knew from the start anything less than physical gold in hand (i.e. a piece of paper saying something is backed by gold or that somebody else has "your" gold someplace "safe") would end in tears.

Article here:

www.silverbearcafe.com...

Is it just me or does anybody else think that companies should be forcibly dissolved when they are caught stealing?

This just isn't right, they should be made to pay back the investors and closed.

There's no substitute for physically owning precious metals.

Paper trades are a sham.

Originally posted by Hastobemoretolife
Is it just me or does anybody else think that companies should be forcibly dissolved when they are caught stealing?

This just isn't right, they should be made to pay back the investors and closed.

I've been wondering about all the lawyers in the USA. 50% of the lawyers IN THE WORLD are in the US. A lot of them don't have much business, especially moreso as the economy implodes.

Why don't 500 out-of-work lawyers band together and seek a massive class-action suit against the banks? What do they have to lose, really? Why the heck hasn't this happened yet?

The entire judicial system is asleep at the wheel. The founding fathers gave us a balance of power that involves three branches. We've heard a lot from Congress and the Executive branch but barely a peep from the entire judicial system (not just the suprime court). This should be a field day for the lawyers and judges. There have been so many in-your-face crimes committed that it should be like shooting fish in a barrel for these people. Instead...total silence. I don't get it.

.. Is this the future of the world, ... no real commodities, .. no real currency.

... perhaps in 2050 I'll go to the store and purchase milk with a piece of paper that says It's worth ten dollars, which was issued by a bank, ... backed by " gold certificates" ...... and 3 or 4 steps down at the end of the line who do we have ????

... An empty vault owned by the " Cash for Gold" envelope company.

Originally posted by silent thunder
I've been wondering about all the lawyers in the USA. 50% of the lawyers IN THE WORLD are in the US. A lot of them don't have much business, especially moreso as the economy implodes.

Why don't 500 out-of-work lawyers band together and seek a massive class-action suit against the banks? What do they have to lose, really? Why the heck hasn't this happened yet?

The entire judicial system is asleep at the wheel. The founding fathers gave us a balance of power that involves three branches. We've heard a lot from Congress and the Executive branch but barely a peep from the entire judicial system (not just the suprime court). This should be a field day for the lawyers and judges. There have been so many in-your-face crimes committed that it should be like shooting fish in a barrel for these people. Instead...total silence. I don't get it.

That's a very good question. You would think with that amount of collective knowledge they could get somewhere. Who knows maybe they are scared are just not smart enough.

It's crazy.

Hi silent thunder.

UPDATE 1-Morgan Stanley to settle class-action lawsuit
Tue Jun 12, 2007 7:22pm BST

Full Text

As you can see from the above link , this event took place back in 2007 (I believe final oral arguments were actually heard in Sept 07). At that time , the case received extensive coverage in the PM community.

The fact that this is dated news , and that it didn't involve a precious metals ETF , doesn't diminish your comments on the wisdom of in investing in paper representations (derivatives). Given that I choose to avoid counter-party risk at all costs....ETF's only have utility as short-term trading vehicles , or as a mechanism for hedging physical bullion positions (options). If more ETF investors would actually take the time to study the the details of the respective prospectus...they might feel the same.

Apparently Greenlight did....

Hedge fund may realize gold ETFs have no metal

Einhorn's Greenlight Hedge Fund Switches Gold ETF to Bullion

By Saijel Kishan
Bloomberg News
Tuesday, July 14, 2009

NEW YORK -- Greenlight Capital Inc., the $5 billion hedge-fund firm run by David Einhorn, told investors it switched all of its holdings in a gold exchange-traded fund into bullion during the second quarter.

Full Text

Let's see how many monkey-see-monkey-do fund managers follow suit

I've been telling people for years that precious metal paper is just that, paper and can be lost stolen or nonexistent when you might need it. Certificates of ownership is fraud pure and simple. There is going to be more of this in the future. Lots of gold, silver and platinum certificates are out there and only a finite amount of those metals! This guy telling folks he converted everything to bullion should have thrown a red flag to anyone invested in his fund. That much bullion being purchased would have caused a ripple in the market and someone would have been looking to see who was trying to manipulate the precious commodities futures! Buy it yourself and put it in safety deposit boxes or in your own safes, Have it in hand not on someones list of paper assets!

Zindo