Let's get one thing straight: gold & silver will win in the end. Set aside all the Central Bank gold smash-downs, all the bear raids, all the manipulation, all the central bank & government & prostitute media, in the end gold and silver will win.
Get this clearly fixed in your mind, as certain as gravity will grab hold of any hammer you drop out a second story window and pull it all the way to the ground. The financial elite that hijacked your government has set up a banking & financial system that must inflate or die. Die they will not voluntarily, so inflate they must. Inflation creates periodic crises, & over the last 50 years these have grown more frequent and more severe. Since 2008 the crisis has engulfed the globe and not even massive liquidity (money creation) & tsunamis of government blarney can fix it.
The central banks will raid the gold market, will talk of slowing quantitative easing & exit strategies, but it's all blarney -- pure hogwash. They can't stop creating money, but they can try to stop you fleeing into gold & silver.
The more they inflate, they more demand for silver & gold they create. And their countermeasures backfire on them. This latest raid on gold has gratified millions of eager, waiting buyers.
Forget all the talk, even my talk, about day to day moves & even primary trends, because the one primary trend that eventually will enforce itself is this: they will keep on creating money until the money fails, and in the end, silver & gold will win.
Tough holding on in the meantime? Maybe so, but in the end, everything but silver & gold is a sucker bet.
And as a friend reminded me today, "If you don't hold it, you don't own it."
Any of y'all still in doubt where I stand?
THIS WEEK'S MARKETS:
It was another gassy week of "new all-time highs" in stocks, & agony without much ecstasy for silver & gold. Platinum stayed roughly even, palladium advanced, and the dollar broke out into a new uptrend.
Much as it may shock stock investors (& others) a "rationalization" is not "reasoning." Most of what passes for "proof" that stocks must go higher is merely the typical rationalization of those gripped by a mania.
Rationally, you buy stock as a source of future income. Right now the S&P500 has a dividend yield of 1.97%, the Dow (average) 2.47. Even a natural born fool from Tennessee knows that you'd have to hold the S&P500 36-1/2 years to get your money back and the Dow 29.1 years. Rip-roaring return, huh? And nowhere near the yields seen in markets with years of upward run awaiting them.
Rationalistically, you say, "Look at them stocks a-blowin' & a-goin'! My hairdresser told me today, and she knows a man who knows a man who trims Bernanke's hedges, that the Fed will keep on easing until 2021." That's about the level of most financial reporting. Doesn't matter: if unemployment or dollar or dog-food rises, that'll be good for stocks. If they fall, that'll be good, too.
Today stocks waited till the end of the day, about 3:40, before they rose, then gained from 15,080 to 15,118 in 20 minutes. Dow ended at 15,118.49, 35.87 (0.24%) fatter than yesterday. S&P500 gobbled 7.03 (0.43%) to lean back from the table at 1,633.70.
Stock's rise today teamed up with metals' fall to tug down the Dow in Gold and Dow in Silver. Dow in gold lost 2.5% or 0.255 oz (G$5.27 gold dollars) & ended at 10.522 oz ($217.52 gold dollars). Almost all the week's loss came today. First downtrend line I drew has been violated to the upside, & the Dow/Gold stands above its 20 DMA (10.31 oz). May be targeting a double top with the 11 oz (G$227.39) top on 15 April. At that high the Dow/Gold hit the long term downtrend line from 1999. Behavior here is critical to the primary trend.
Dow in Silver simply isn't behaving as the Dow in Gold. Believe it or not, stocks are having to work harder to gain against silver, with less result. Today Dow/Silver closed 639.75, up 8.12 oz. Still in a downtrend, but old high is 656.15. Here, too, Dow/Silver is tapping against its long term (since June 2001) downtrend line.
US Dollar index made good its escape from the shell yesterday (up 82.5 basis points) by jumping another 47.1 basis points (0.61%) to 83.165. Dollar index is targeting at least 83.50, maybe lots higher.
Poor old folks who were long euros or short dollars got caught today. Euro sank beneath its 20 dma yesterday, through its 50 dma today, & pierced but closed not below its 200 DMA. Lost 0.42% to $1.2984. Busted.
Japanese yen today did what few believed possible, it gapped down & sank to a lower low, 98.41 cents/y100, down 1%. Wonder what it will take to make capital flee the yen? Wonder what kind of havoc this is wreaking with the export plans of other Asian & European nations?
US$1=Y101.6=E0.7724=0.042 316 oz Ag=0.000 696 oz Au.
Somebody slammed gold HARD about 5:00 a.m. sending it gap-down from $1,445 to $1,435. Fell lower still by the New York opening, to a $1,421 low about noon. About 12:45 it gapped up to $1,435, then closed Comex down $32 for the day. It's pretty sorry when the best thing you can say about a market is, "Well, at least it closed $15 above the low."
But that does say a little something, namely, hungry buyers are ganged up around $1,425. After Comex closed gold rose another $7.
Today's drop merely continued the fall out of the channel that began Tuesday. Gold close plumb on its 20 day moving average, so Monday may be a mess. Short term gold must climb above $1,475 to reverse this downtrend.
Silver remained more phlegmatic than gold again today, but suffered damage all the same. Silver lost only 24.7 cents by the time it closed Comex at 2363.2c.
At 5:00 a.m. (I'm always talking about New York Time, 5 hours ahead of London) silver fell sharply from 2370c to 2360c in a few minutes, traded sideways an hour, then gapped down to 2335c. By 9:45 silver had reached its low at 2319c, traded a long time sideways, then gapped up from 2335c to 2360, boom. Formation it left behind is a classic island reversal. Only trading into that gap left behind would gainsay that.
Silver's 2319c low today considerably exceeded yesterday's 2373.6.
Signals here are arguing with each other. Silver today fell out of its established upward channel, and within that upward channel it had formed an even-sided triangle. Breaking down from a channel and a triangle points to lower prices -- but where do you put that island reversal? Or prices 20 cents higher after Comex?
All in all, we have not yet reliable signs that silver & gold have made a lasting bottom & turned up. Calmly, patiently, we have to wait for that proof.
On 10 May 1775 the Second Continental Congress convened in Pennsylvania and votes to issue paper money for the first time. It was not the last time, & in fact Congress issued paper money so many times that by the Revolution's end it was all practically worthless. The memory of that catastrophe was largely responsible for including Article I, section 10 in the US Constitution, "No State shall make any Thing except gold and silver coin a tender in payment of debt." That's still in the constitution, but for some reason instead of following that, the congress has given a monopoly to create money to a private banking cartel, the federal reserve system.
Why do y'all take it? Why don't you rise up & demand your rights & your inheritance? You have nothing to lose but your debt-slavery chains.
Y'all enjoy your weekend!
Argentum et aurum comparanda sunt —
Silver and gold must be bought.
— Franklin Sanders, The Moneychanger