Posted on Jun 8, 2020

Money Metals Exchange

Investors dumped paper gold and silver along with stocks, commodities, and most other asset classes in March. The price of silver dropped to $12.02/oz on March 18th and gold bottomed at $1,473/oz.

The bullion banks – notorious for their concentrated short positions – might have made a killing. But that isn’t what happened. Some of the most prominent players took massive losses instead.

Scotiabank, which has roots in precious metals going back to the late 1600s, is closing its metals trading business. The firm announced it would exit the business and set aside $168 million to cover the costs of blowing up a formerly profitable racket.

Part of those funds are earmarked for metals trading losses. The balance is a reserve to pay for fines and penalties related to the ongoing investigation of price rigging in the metals markets.
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