What Do Air Plane Crashes and the Precious Metals Markets Have in Common? / Commodities / Gold & Silver 2019
Boeing and the Federal Aviation Administration worked closelytogether to hustle a new passenger jet through the safety certificationprocess. The combined efforts to save time and cost, coupled with little senseof accountability, resulted in a tragic safety flaw.
Now hundreds of passengers are dead, albeit in other countries.The public is finding the enormous trust placed in the manufacturer and theagency tasked with monitoring safety was badly misplaced.
The regulator tasked with safety appeared more interested inprotecting Boeing’s monopoly and bottom line.
Here is an excerpt from an article last week in the SeattleTimes:
Federal Aviation Administration managers pushed its engineers todelegate wide responsibility for assessing the safety of the 737 MAX to Boeingitself. But safety engineers familiar with the documents shared details thatshow the analysis included crucial flaws.
The FBI announced it will join acriminal investigation into the process for certifying the 737 MAX.
Precious metals investors will findmany elements of the Boeing story familiar.
Gold andsilver bugs have already learned just howdangerous it is to trust corrupt and captured federal regulators. Now thatlesson is being taught to Americans at large.
By the time all the details of thissordid tale have been published, more Americans will wonder who federalregulators really work for.
Gold and silver investors who havebeen similarly betrayed by the regulators. Regulatory malfeasance andcorruption is a theme the precious metals markets and airline industry have incommon.
Concerns over regulatory capture anda track record of failure were largely ignored. Editors at Bloomberg outlined some of the history of the FAAin a March 21st editorial. Suffice it to say the recent crashes aren’t theonly examples of the agency putting the needs of airlines and planemanufacturers ahead of public safety.
The Commodity Futures Trading Commission, the primary regulatorfor gold and silver futures markets, spun its wheels for five years on aninvestigation into riggingof silver prices. The investigation ended in 2013, withouta single charge being levied.
Just 3 years later, Deutsche Bankagreed to settle a civil suit and cooperate by providing evidence for useagainst the other banks involved.
The bank turned over hundreds ofthousands of documents and dozens of recordings which reveal widespread pricerigging during the exact period of time the CFTC was investigating.
Congressman Alex Mooney (R-WV)is demanding the CFTC explain itself.
Regulators collaborate with thewolves who guard the hen house. The FAAoutsourced much of its work to Boeing and agency managers pressured their ownpeople to meet the company’s demands.
When it comes to financialregulation, the situation is no different. And it could even be worse.
The CFTC works closely with banks,and employees there often leave to take high paying job in the industry theyused to regulate.
Most Americans don’t realize,however, that banks have been put in charge of their own oversight as a matterof law. Regulators aren’t collaborating with wolves, they are wolves.The Federal Reserve is the primary regulator for banks, and it is owned by thelikes of JPMorgan Chase and Citicorp.
Too bad most Americans didn’t knowabout that when the Fed masterminded the bank bailouts in 2008.
It would have helped them understandwhy the central bank was eager for banks to avoid accountability for themassive fraud and resulting economic catastrophe.
Unless outrage forces a majorreevaluation of the regulatory scheme, there isn’t likely going to be muchchange.
The federal agencies involved willstill be in charge of oversight. Worse, if history repeats, they may berewarded with budget increases. Officials generally whine about a lack ofresources and Congress usually buys it.
There is another parallel betweenthe recent plane crashes and price rigging in the metals markets, and this timeit is good news.
The customary process, whereby theregulator conducts the investigation and either takes no action or slaps a fewwrists, is going to be circumvented.
The Department of Justice is pursuingcriminal investigations in both cases. And both will be litigated in civilcourt where class action attorneys can take full advantage of the large trovesof evidence available.
The corporations and the regulatorsthat have enjoyed such a close working relationship have lost credibility.Outside parties are going to get a look at what happened. There is genuinereason to hope people will be held to account this time.
By Clint Siegner
Clint Siegner is a Director at MoneyMetals Exchange,perhaps the nation's fastest-growing dealer of low-premium precious metalscoins, rounds, and bars. Siegner, a graduate of Linfield College in Oregon,puts his experience in business management along with his passion for personalliberty, limited government, and honest money into the development of MoneyMetals' brand and reach. This includes writing extensively on the bullionmarkets and their intersection with policy and world affairs.
© 2019 Clint Siegner - All Rights Reserved
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