The Moneychanger
Daily Commentary
Wednesday, 21 November a.d. 2012 Browse the commentary archive

I wasn't going to write a commentary today, but my son said so many people called about my complaint eysterday about the US Post Office changing the rules on insured packages, I'd better explain further.

They are no longer paying claims for bullion or currency shipped by "Insured Mail." This is not the same as "Registered Mail With Postal Insurance." Registered mail must be signed for every time it changes hands, so very, very rarely goes lost. "Insured Mail," on the other hand, might as well have a label that says, "Steal me, you can get away with it."

The US Post Office has NOT stopped insuring gold or silver shipped by "Registered Mail with Postal Insurance." My wife Susan specifically asked that question.

Only real solution is to get private insurance & use UPS or Fed-Ex.

Today the US dollar index firmed up 4.6 basis points to 80.941. Big news was the yen, which gapped down again, ending the day down 1% at 121.16 cents to Y100. Euro moved sideways to $1.2827, up 0.08%.

Currencies: US$1=Y82.54=E0.7796=0.029990 oz silver= 0.000579 oz gold.

Stocks did nothing dramatic today, edged up as traders flattened position before the long weekend.

Silver & gold proved yet again that they have no intention of dropping further. They bounced off yesterday's lows and closed near today's highs. Gold closed $1.727.90, up 4.70, after a $1,731.46 high & $1,721.68 low. Silver gained 42.1 cents to 3334.4c. High was 3338c and low 3286c. Mark that the ratio dropped to 51.820 today from 52.340 yesterday. I remind y'all that a FALLING gold silver ratio accompanies a RISING gold and silver market.

Silver & gold have begun their next huge rally. Buy now, stop waiting. Much higher prices loom.

On 21 November 1864 from Georgia Confederate General John Bell Hood, launched the Franklin-Nashville campaign into Tennessee. Suffering severe pain from a leg amputated at Gettysburg, probably on morphine, Hood was the worst possible choice for the campaign, which was a sound strategy & might have prevailed with anyone else in charge. His commanders didn't trust him and he didn't trust the glorious, tenacious Army of Tennessee. When the campaign had ended, Hood had accomplished in a month what the yankees could not compass in four years: he had smashed the Army of Tennessee.

How brave were those soldiers? Lt-Genl. Bedford Forrest covered the retreat. When he noticed that in that bitter weather his infantry had no shoes & their feet were bleeding, cut by the icy ground, he ordered up wagons for them. Barefooted in freezing weather, they would climb into the wagons, ride a while, then unload and make a stand, over and over and over, from Nashville back to Alabama.

And some people wonder why we can't forget.

May God bless all of you this Thanksgiving with grateful hearts.

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

— Franklin Sanders, The Moneychanger

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Market Snapshot See more charts and market data
21-Nov-12 Price Change % Change
Gold, $/oz 1,727.90 4.70 0.27%
Silver, $/oz 33.34 0.42 1.28%
Gold/Silver Ratio 51.820 -0.520 -0.99%
Silver/Gold Ratio 0.0193 0.0002 1.00%
Platinum 1,581.40 10.90 0.69%
Palladium 650.70 12.95 2.03%
S&P 500 1,391.03 3.22 0.23%
Dow 12,836.89 48.38 0.38%
Dow in GOLD $s 153.57 0.18 0.12%
Dow in GOLD oz 7.43 0.01 0.12%
Dow in SILVER oz 384.98 -3.45 -0.89%
US Dollar Index 80.94 0.05 0.07%
IMPORTANT NOTE: The following are wholesale, not retail, prices. To figure our retail selling price, multiply the "ask" price by 1.035. To figure our retail buying price, multiple the "bid" price by 0.97. Lower commissions apply to larger orders, higher commissions to very small orders.
SPOT GOLD: 1,728.90      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,779.04 1,789.41 1,789.41
1/2 AE 0.50 881.23 910.70 1,821.40
1/4 AE 0.25 440.61 463.99 1,855.97
1/10 AE 0.10 181.43 189.31 1,893.15
Aust. 100 corona 0.98 1,686.19 1,696.67 1,730.94
British sovereign 0.24 406.98 410.98 1,745.89
French 20 franc 0.19 322.79 326.79 1,750.32
Krugerrand 1.00 1,754.83 1,769.83 1,769.83
Maple Leaf 1.00 1,738.90 1,753.90 1,753.90
1/2 Maple Leaf 0.50 855.81 899.03 1,798.06
1/4 Maple Leaf 0.25 427.90 458.16 1,832.63
1/10 Maple Leaf 0.10 171.16 186.72 1,867.21
Mexican 50 peso 1.21 2,067.69 2,084.69 1,729.03
.9999 bar 1.00 1,734.95 1,745.95 1,745.95
SPOT SILVER: 33.24      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 30,500.00 32,500.00 42.48
VG+ Peace dollar 0.77 30,000.00 32,000.00 41.83
90% silver coin bags 0.72 23,763.03 24,013.03 33.58
US 40% silver 1/2s 0.30 9,612.58 9,812.58 33.26
100 oz .999 bar 100.00 3,315.50 3,363.50 33.64
10 oz .999 bar 10.00 337.35 339.85 33.99
1 oz .999 round 1.00 33.09 33.79 33.79
Am Eagle, 200 oz Min 1.00 34.74 35.44 35.44
SPOT PLATINUM: 1,581.40      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 1,591.40 1,631.40 1,631.40
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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.

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