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JP Morgan, Blackrock and Goldman have all been given approval by the SEC to buy a large amount of copper available on the market and stockpile it, Kocieniewski reports. Read more: www.businessinsider.com...
Flash ahead to 2013, and readers of my previous commentary were presented with the earth-shattering findings of a trio of Swiss researchers
In detail, nearly 4/10 of the control over the economic value of [all transnational corporations] in the world is held, via a complicated web of ownership relations, by a group of 147 [transnational corporations] in the core, which has almost full control over itself. The top holders within the core can thus be thought of as an economic “super-entity” in the global network of corporations. A relevant additional fact at this point is that ¾ of the core are financial intermediaries. [emphasis mine]
In 1980, it was intolerable for one entity to have even a 20% share of one, small market. In 2013, the same cabal of (Western) governments has allowed a “super-entity” to acquire double that share – not of a single (small) market, or a whole sector, or even an entire economy. Rather, this is a single “super-entity” with 40% control of everything.
Of course when these researchers coined their term “super-entity”, they had no need of inventing new terminology. The word they were searching for was “monopoly”: a single monopoly with 40% control over the entire global economy.
When the Federal Reserve gave JPMorgan (JPM) Chase & Co. approval in 2005 for hands-on involvement in commodity markets, it prohibited the bank from expanding into the storage business because of the risk.
Five years later, JPMorgan bought one of the world’s biggest metal warehouse companies.
While the Fed has never explained why it let that happen, the central bank announced July 19 that it’s reviewing a 2003 precedent that let deposit-taking banks trade physical commodities.
Goldman Sachs own the warehouses that they bought from Metro International in 2010. In that time the amount of aluminum stored has gone from 50,000 tons to 1.5 million tons, and normal time for shipment has increased from 6 weeks to around 16 months.
... Aluminum users like MillerCoors are being forced to wait in some cases over 18 months to take physical delivery due to the LME warehouse practices or pay the high physical premium to get aluminum today. This does not happen with any of the other commodities we purchase, “said
This “grand experiment has gone far better for the banks than it has for the consumers,” Joshua Rosner, managing director of Graham Fisher and Co., said. “Electricity users appear to pay more because of Wall Street involvement, aluminum for airplanes and soda cans costs more, and some say gasoline at the pump costs more -- without any measurable benefit to anyone but the banks.”
... that allowing financial holding companies to control commodities, such as aluminum, oil and electricity, is in fact better for the consumer, because they “increase customer choice, increase competition, act as more effective intermediaries between producers and end-users, provide increased liquidity to the markets and lower prices to consumers.”