The Moneychanger
Daily Commentary
Tuesday, 28 May a.d. 2013 Browse the commentary archive

I want y'all to think cagey about today's stock market rise. Y'all remember what happened last Wednesday, when stocks fell around the planet? That brand of volatility spells T-O-P. It often haps that a topping market makes a peak, falls sharply, then rebounds nearly to that peak just as sharply. Might happen more than once. Don't let 'em sucker you.

Dow's intraday high last Wednesday was 15,542.40. Today it stopped at 15,521.49, barely below Wednesday.

Dow closed up 106.29 (0.7%) at 15,409.39. On an intraday high today of $1,674.21 (vs. Wednesday's 1,687.18) the S&P inched up 0.63% or 10.46 to close 1,660.06.

Dow in Gold & Dow in silver both rose today, but not to new highs. Dow in Gold rose 1.21%, Dow in silver 2.04%. No change or confirmation yet.

This country looks mighty familiar to me. I was here once before, in 1999 and 2000. Takes some time for stocks to top, but top they will. Why do I say that? Just because I am a sourpuss on stocks? Not at all. Rather, they are floating on a sea of newly created money, the economic outlook hath not materially bettered, and the alternative yield is less than 1% most places. Not a recipe for Dow 36,000, regardless what the financial bimbos & beanbrains on TV tell you. Ahh, but they are glamorous, wear make up, & sweat under spot lights, while I am only a natural born fool from Tennessee & I just sweat. Ain't ne'er a spot light here anywhere.

Your Yankee government is stepping up the war on competitors to its greenback dollar. Shut down another electronic currency provider today, and on the 17th seized assets of MtGox, one of the largest currency-to-Bitcoin providers. Now the people the YG shut down today may be really bad folks, I don't know. I only know that the only way to tell a government prosecutor is lying is to watch his lips. If they're a-moving, he's a-lying. But since even a blind hog now & then finds an acorn, maybe the folks they shut down today really were bad folks. I just never know who to believe, I've heard so many lies. Shoot, they told some lies about me so big I didn't even know who they were talking about! I thought, "They ought to get THAT guy off the streets!" until I found out it was me. It like to hurt my feelings.

Them old nasty fiat currencies! Even talking about 'em is like dipping your hand into a bucket of hog snot. But I have to do it, so look at the US dollar index. For some gassy reason it rose 57.5 basis points today (0.74%) to 84.237. Five day chart shows a rounding bottom, so 'twill likely rise from here, if it can stay above the lip of that bowl about 84.30 tomorrow. If it can't, then we're merely watching the reaction from its first drop from that 84.60 peak, and in a day or two it will fall through 83.50. I have no dog in this fight, as I have been shucking dollars since 1999, and am not likely to buy any again soon.

The euro fell back today toward the bottom of its recent range. Lost 0.62% to $1.2852. I sure do feel sorry for the folks trapped in that thing. European economy is worse than the US.

Japanese yen bobbles up and down, but always seems to bobble down again. Caved in 1.02% today to 97.76 cents/Y100.

Poor old Ben Bernanke! He's like a man who falls into a rattlesnake den -- whichever way he steps, they're waiting to bite him. He's been so successful raising stock prices with his money pump that folks may be leaving US bonds for stocks. At least, that's what the 10 Year US Treasury Note Yield says today. Rose to 2.135%, which is an upside breakout. This rattlesnake might sink his teeth clean down to Ben's anklebone. More people who want to sell bonds, more the price drops, and when the bond price drops, the yield rises, and that contradicts Ben's ZIRP. No, that's not a weapon for aliens, that's his Zero Interest Rate Policy. Market might be fixing to cancel his policy.

Today gold backslid $7.70 (0.6%) to $1,378.90 while silver slumped 30.2 cents (1.3%) to 2218c.

Gold remains trapped by $1,395 and remains in pretty much the same range but widened out the bottom a tad with a $1,373.70 low. That is the STRANGEST one day chart you're likely to see. About 4:30 a.m. New York Time (11:30 a.m. Greenwich) somebody kicked gold in the head like a mule. Gapped down from $1,390 to $1,383. Gold traded sideways until New York opened, then down a little ($1,373 low) and up a little to $1,384. Then about 11:30 it gapped UP to $1,397, strong as a garlic milkshake. Didn't hold on there, but eroded back to close lower at $1,378.90 & flatten out. Charts just keep on acting contrary to reason & expectation. When a market breaks like that, then comes back with such zeal, you expect that means it wants to turn up. Not if it's gold, apparently. Wait, wait! Who's that man behind the green curtain! What? Pay no attention to the man behind the curtain? But why not? Oh, that's just old Ben. Never mind him.

Silver, too, managed to close near the day's lows, but traded up in the aftermarket. Chart differs a tee-tiny bit from gold's, but fundamental tale is the same: gap down, sideways, gap up, and sliding down.

On a 4-month chart gold has traced a little uptrend the last six days, but it's not much to look at. Silver has just gone sideways since that strange downspike a week ago yesterday.

Longer this drags on, the better buying silver & gold looks to me. I'm still nervously looking over my shoulder for that possible one-more plunge, but I don't like waiting. It's too clear in my mind that the Nice Government Men engineered these gold & silver lows, like they've engineered the stock market's rise, to punish anyone daring to prefer to hold one of the scrofulous US dollar's competitors, namely, silver or gold. Why'd they need to do that? What are they seeing in their crystal ball that makes them nervous? I don't know, I just don't trust 'em.

We upgraded our website a while ago but are just now re-posting some back articles on Alternative health. Go to to take a look. I especially recommend the article "Nutritional Cancer Therapy," an interview with Dr. Nicholas Gonzalez.

On 28 May 1830 the US congress passed the shameful Indian Removal Act, and Andrew Jackson has a shamefully big part in it. The act provided for the removal of the Cherokee, Muscogee (Creek), Seminole, Chickasaw, and Choctaw nations from their homelands in the South to Oklahoma. These nations were known as the Five Civilized Tribes and were in the process of adapting to Western culture. Many died on the way that became known as the "Trail of Tears." It ran in part over the Natchez Trace, not far from where I live.

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
25-May-13 Price Change % Change
Gold, $/oz 1,378.90 -7.70 -0.56%
Silver, $/oz 22.18 -0.30 -1.34%
Gold/Silver Ratio 62.169 0.493 0.80%
Silver/Gold Ratio 0.0161 -0.0001 -0.79%
Platinum 1,460.60 8.70 0.60%
Palladium 757.00 30.55 4.21%
S&P 500 1,660.06 10.46 0.63%
Dow 15,409.39 106.29 0.69%
Dow in GOLD $s 231.01 2.87 1.26%
Dow in GOLD oz 11.18 0.14 1.26%
Dow in SILVER oz 694.74 14.06 2.07%
US Dollar Index 84.24 0.58 0.69%
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: 1,381.20      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,419.87 1,427.47 1,427.47
1/2 AE 0.50 707.35 730.31 1,460.62
1/4 AE 0.25 357.13 372.06 1,488.24
1/10 AE 0.10 144.92 151.59 1,515.87
Aust. 100 corona 0.98 1,345.73 1,359.73 1,387.20
British sovereign 0.24 327.09 337.09 1,431.97
French 20 franc 0.19 257.87 260.87 1,397.27
Krugerrand 1.00 1,404.68 1,417.68 1,417.68
Maple Leaf 1.00 1,396.20 1,411.20 1,411.20
1/2 Maple Leaf 0.50 794.19 725.13 1,450.26
1/4 Maple Leaf 0.25 352.21 369.47 1,477.88
1/10 Maple Leaf 0.10 146.41 150.55 1,505.51
Mexican 50 peso 1.21 1,656.85 1,671.31 1,386.18
.9999 bar 1.00 1,386.03 1,397.03 1,397.03
SPOT SILVER: 22.24      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 29.00 32.00 41.83
VG+ Peace dollar 0.77 26.00 29.00 37.91
90% silver coin bags 0.72 17,542.53 17,907.53 25.05
US 40% silver 1/2s 0.30 6,190.58 6,560.58 22.24
100 oz .999 bar 100.00 2,223.50 2,298.50 22.99
10 oz .999 bar 10.00 227.35 228.35 22.84
1 oz .999 round 1.00 22.34 23.24 23.24
Am Eagle, 200 oz Min 1.00 23.49 25.24 25.24
SPOT PLATINUM: 1,460.60      
Plat. Platypus 1.00 1,485.60 1,525.60 1,525.60
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© 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.

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