Mercy, here's something that'll surprise y'all, a headline from the New York Times (motto: "All the news that fits"): "Bailout in Spain Leaves Taxpayers Holding the Bag." Now THERE'S a surprise, a bank bailout that leaves taxpayers with the tab. They get the profits, we get the shaft. Dog bites man, bankers bite taxpayers.

Of the two possible outcomes I laid out for stocks yesterday, it appears, since stocks rose today instead of crashing through that 12,400 neckline, that they will form the right shoulder of a head & shoulders top before they plunge further. This will paint out a rise to 12,600 or so over a day (maybe two), then drop toward that neckline. A close above Dow 12,650 would gainsay that outlook and point stocks higher.

Today the Dow rose 162.57 points (1.31%) to end at 12,573.80. S&P500 rose 15.25 (1.17%) to 1,324.18. Dow dropped 143 yesterday rose 163 today. This is wheel-spinning, burning up buying fuel and friends alike.

Euro rose a little today, up 0.25% to $1.2506. Remains below it's 20 DMA at 125.65. Peeteeful.

Yen went sideways but looks weaker & weaker lost 0.09% to 125.84 cents/Y100 (Y79.47/US$1).

US dollar index lost 17.6 basis points (0.23%) to end at 82.419. Five day chart is whispering & hinting that the dollar has turned, but must clear 82.85 to confirm that.

Gold made good my suspicions that it was headed higher by crossing the psychological $1,600 barrier today, along with the $1,600 - $1,608 technical barrier. It rose $17.20 to shutter Comex at $1,612.70. Next barrier is $1,630. Expect gold to continue its upward march.

SILVER still failed to pierce that 2900 cent barrier, although it did touch 2904c. Not it becomes crucial for silver to step across that 2900c line and take gold's hand in agreement and rise to the occasion. Expect that tomorrow.

I always love for people to send me opinions opposite to mine because it forces me to check my own conclusions (well, unless it's from some Wall Street do-do who doesn't' know "sic 'em" from "come here" to begin with.) Anyhow, I saw one the other day that was right well reasoned, claiming that Gold could drop yet again to $1,435. Good technical observations, but with a wrong conclusion, I humbly demur. Reason is that silver is now into its 13th month of correction and gold into its 9th month, & that ought to suffice to have reached a bottom and begin slowly to turn up. Humility & long experience with chastening makes me add, "But I could be wrong."

On 12 June 1861 Missouri Governor Claiborne Jackson called for 50,000 volunteers to stop the Federal government from taking over his state. In a coup d'état worthy of Vladimir Lenin, the Federals did seize the state.

On 12 June 1867 the Austro-Hungarian Empire was formed. In fact, delegates had been working on it for months, but had gotten hung up on the name. Should they call it the Hungaro-Austrian Empire, or the Austro-Hungarian? Finally the decided to do it in alphabetical order, and the empire was swiftly launched.

Argentum et aurum comparanda sunt —
Silver and gold must be bought.

— Franklin Sanders, The Moneychanger

Copyright Notice

© 2015 Little Mountain Corporation, d.b.a. The Moneychanger. All rights reserved. May not be republished in any form, including electronically, without our express permission.

Warnings and Disclaimers

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary trend is up, targeting 16:1 gold/silver ratio or $195.66; stock's primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold or 16 ounces of silver. US$ and US$-denominated assets, primary trend down; real estate bubble has burst, primary trend down.

Be advised and warned:

• Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short-term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures.
• NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps.
• NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced.
• NOR do I recommend buying gold and silver on margin or with debt.
• What DO I recommend? Physical gold and silver coins and bars in your own hands. For additional information, please see our Ten Commandments for Buying Gold and Silver.
• One final warning: NEVER insert a 747 Jumbo Jet up your nose.

Explanation of Terms

The US DOLLAR INDEX is the average exchange rate for the US dollar against the Euro, Yen, Pound sterling, Canadian Dollar, Swiss Franc, and Swedish Krona, weighted for each country's trade with the US. It gives a general measure of the US dollar's performance against all other currencies.

The DOW IN GOLD DOLLARS measures the Dow Jones Industrial Average in gold dollars (0.048375 troy oz. by law). The DiG$ depicts the Primary (20 year) Trend of stocks against gold. When the DiG$ is dropping, gold is gaining value against stocks in a trend that should last 15-20 years. The DiG$'s chart is identical to the Dow in ounces of gold, but gives us one unvarying measure all the way back to 1896. Because it shows the primary trend ("tide") of gold against stocks, for investors it is the single most important financial chart in the world today. Since its August 1999 high at G$925.42 (44.8 ounces), the DiG$ has trended down, targeting a G$80-G$20 (4-1 oz. of gold will buy the whole Dow).

The DOW IN SILVER OUNCES shows how many ounces of silver are needed to buy the entire Dow. The DiSoz is trending down with a target of under 36 ounces.

The GOLD/SILVER RATIO is the gold price divided by the silver price, and shows how many ounces of silver it takes to buy one ounce of gold. The Ratio shows us the Primary (20 year) Trend of gold's value against silver. When the Ratio's trend is dropping, silver is gaining value against gold. This trend targets a gold/silver ratio of 16 ounces of silver to one of gold within the next 5-10 years. That implies that silver will massively, vastly outperform gold before this bull market ends. When both metals are rallying, the ratio often (but not always) drops, confirming the rally.

Other Important Information

This is not an offer to buy or sell. Prices subject to change without notice. To enter an order, call us at (888) 218-9226 or (931) 766-6066. Sorry, no sales to Tennessee.

For complete details on how to buy from us or sell to us, please click here.