Just to set the record straight with all the possibilities & to de-calumniate the Nice Government Men from any of my wrongful accusations, it is certainly possible that those sudden spike-up/spike-down could be caused by hedge fund computerized program trading. They set the program to trade certain percentage moves, & if those occur, the computer automatically enters the trade. So it might not be NGM alone spiking the gold market. They may be getting help from computerized trading. Of course, that does NOT say they do not manipulate the gold market, as that manipulation is plainly attested by statute, statutory mandate, and policy. See the "Exchange Stabilization Fund" in the 1935 Gold Reserve Act.

French & German stock markets dropped nearly 3% today on fresh (?stale) worries that Spain may need a bailout, which, of course, is impossible given its size. Ten year Spanish government bond yields hit 7.5% while Spain's stock market regulator banned all short selling for three months. Italy followed suit, but with a shorter ban. Fear slopped over into US stock markets, but most interesting was that the US treasury yields touched record lows. Hard to pick a top in that market, but sometime here US treasuries will either absorb all the money in the world, or their price will peak and they will drop (remember, bonds move opposite to their yields, so higher bonds mean lower yields).

The gigantic belly laugh in all this, if you like Gallows Humor, is that the US dollar & yankee government debt are being called "safe havens." Safe from what? From default? Nope, that's happened several times in US history. From inflation? Not since 1913. I may be a natural born fool, but Thunderation! I ain't durned fool enough to believe a proposition THAT stupid.

If you think the Dow down 0.79% (101.11 points) at 12,721.46, or the S&P down 0.89% (12.14 points) at 1,350.52 is bad, you should have seen them at the lows, down a meaty 2.8%. Those Nice Government Men must have had a brain-busting day, bringing the Dow back from 360 points down.

Listen, there's more Looney-dom in the air. Commentators & gurus are bragging about how much the indices came back during the day. Folks, if you got to brag about something like that, you got nothing to brag about. Like one wino bragging to another that his rags are better than the other winos.

These people must think we are REALLY dumb.

US dollar index rose 88 basis points or 1.06% from Friday's close. High came at 83.99.

However, 'tain't all it seems. On the long term chart that only took the US dollar to the top boundary of its trading range stretching back to the end of 2011. Yes, the dollar MIGHT break through that channel line and run for 90, but it hasn't done yet, & the rule says sell the top of the channel & buy the bottom.

Personally, I can't imagine that international criminal Bloviating Ben Bernanke going home early tonight, not without calling his co-conspirators in the other central banks and making plans to keep the dollar from rising sunward & the euro from sinking earthward. In other words, tomorrow would be a good time for some announcements timed to knock the dollar in the head and boost the euro.

Owch. Speaking of the euro, it lost another 0.33% today to end at ANOTHER new low, $1.2118. Yen actually poked it's little noggin through the downtrend line, and ended up 0.17% at 127.58c (Y78.38).

Gold took a left to the jaw, but came back pretty well (Am I saying the same thing those stock gurus are saying? Have I completely lost my mind? I probably have.) Low came at $1,563.61, high at $1,579.74, but gold closed only $2.60 off its high, ending at $1,577.10, down on the day $5.40.

Today's low carried gold all the way to the bottom boundary of that even-sided triangle we have been eternally watching, but it bounced clean back up to the middle of the range. Okay, Moneychanger, how is that different from what stocks did today?

Plainly in this wise: Stocks dropped THROUGH their rising wedge's bottom boundary. True, they closed back up within the wedge, but only barely. Gold never stumbled out of its triangle.

Silver repeated gold's performance, & I call both of those successful tests. Stocks didn't rank the same in my eyes. Hope I'm not just talking my position, in preparation for having my head handed to me on a platter.

Silver's low came today at 2666 cents about 8:30 but it spent the next 3-1/2 hours climbing up to 2717c. Afterward it gave back a little, but only levelled off above 2700c. Comex silver lost 26 cents to end at 2701.9c.

This sideways-to-lower times are about as comfortable as walking on sharp gravel barefooted. I know that, but it's summertime and the world's economies & fiat currencies are coming apart. You have to expect a little confusion under those circumstances. I am not worried, silver & gold will yet vindicate themselves, and I don't expect we will see lower prices that we have already seen this year.

Keep your eyes on the horizon, not on the potholes. Nothing has changed. Silver & gold remain in a bull market.

Something about the terrible shooting in Aurora Colorado I just can't swallow. Almost always it comes out later in the small type that the shooter was on some anti-depressant, but this whole play, with the utterly unlikely shooter, looks like a genuine Manchurian Candidate operation.

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

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