The Moneychanger
Daily Commentary
Wednesday, 5 June a.d. 2013 Browse the commentary archive

One of the greatest propaganda coups of the banks ("The Money Interest") has been to take discussion of the banking system and money clean off the table & consign all questions to the "scientific experts" of the Federal Reserve.

All American history can be explained as a struggle between Jeffersonians and Hamiltonians. Jeffersonians have always stood for an independent, self-sufficient people, and Hamiltonians for an elite -- the people versus the banks. People versus the parasites.

Today the banks, cartelized under the Federal Reserve in 1913, reign supreme. If you want to know what the victory of "The Money Interest" would mean, look around you.

This weekend leaders of "The Elite" will be meet at the Bilderberger conference in Watford, England, most likely to figure out how the banks will bleed us next. To give you a glimmer how the news is managed, I searched Google News for "Bilderberger" & the out of the first ten items that came up, only three were in English, the rest in German. Shucks. Did I mention that Google CEO Schmidt is a Bilderberger, too? Or that the Bilderbergers will be talking about a global tax?

Never mind. It's all a coincidence.

TODAY'S MARKETS

Hardly had the words tripped off my fingertips about stocks' dropping to their 50 day moving averages than they obliged. Dow plunged 216.95 (1.43%) today to end below 15,000 at 14,960.59. S&P500 plummeted 22.48 (1.38%) to 1,608.90. Those 50 DMAs now stand mighty close at 14,914 & 1604.17.

Size of today's drop means both indices crossed a meaningful line. Dow fell out of its established trading channel, S&P500 lacked maybe 6 points of that. Stocks have further to fall before stopping. This correction probably does NOT mark the end of the rally that began in 2009. That should come by year end or 1Q2014.

Dow in Gold and Dow in Silver both closed below their 20 DMAs today.

Dow in gold closed down 1.52% at 10.698 oz (G$221.15 in gold dollars). 20 DMA is 10.86 oz. (By the way, the 1929 closing high was $381.17 or 18.44 oz. Either stocks were worth a lot more then, or gold a lot less.)

Dow in Silver closed at 665.95, down 11.62 oz. or or 1.71%. 20 DMA stands at 669.05. Long term downtrend line stands about 620 oz.

Today's crossing below the 20 DMA was the first confirmation the trend has turned down. That implies silver & gold will begin gaining value faster than stocks (or, losing value more slowly -- either is mathematically possible).

Yesterday's dollar index rise was merely the final kiss good-bye, the bounce back up to the broken uptrend line. Today the dollar index tripped again, 19.7 basis points (-0.24%) to 82.575. Dollar crosses internal support line at 82 & speeds its fall.

Euro built modestly on its breakout through the downtrend line by rising 0.11% to $1.3094. Sure doesn't act like it's in any hurry to run away upside. Yen recovered after its bout with acrophobia yesterday to rise 0.81% to 100.8 cents/Y100. 50 DMA stands at 101.00.

US$1=Y99.2=E0.7637=0.044 514 oz. Ag=0.007 150 oz. Au.

Still trapped within the same range, gold rose $1.30 to $1.398.40 while silver added 6.5 cents to 2246.5c.

On a five day chart both precious metals have formed a long even-sided triangle the first three days of this week. Even-sided triangles can break out either way, up or down.

This much is clear. If gold closes below $1,390, it will fall further. If it climbs over $1,420 - $1,425, it should rally. (Silver under 2200c or over 2330c.)

Meanwhile Commitments of Traders & Bullish percentage indicators are shouting that both gold and silver are rampaging good buys.

These stand-offs appear quiet, but are spring-loaded with tension. The market will break one way or the other soon.

Just to show you how things have changed, on 5 June 1794 the US congress passed a law prohibiting US citizens from serving in any foreign armed forces.

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
5-Jun-13 Price Change % Change
Gold, $/oz 1,398.40 1.30 0.09%
Silver, $/oz 22.47 0.07 0.29%
Gold/Silver Ratio 62.248 -0.123 -0.20%
Silver/Gold Ratio 0.0161 0.0000 0.20%
Platinum 1,509.40 19.50 1.31%
Palladium 754.30 5.45 0.73%
S&P 500 1,608.90 -22.48 -1.38%
Dow 14,960.59 -216.95 -1.43%
Dow in GOLD $s 221.15 -3.42 -1.52%
Dow in GOLD oz 10.70 -0.17 -1.52%
Dow in SILVER oz 665.95 -11.62 -1.71%
US Dollar Index 82.76 -0.20 -0.24%
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: 1,402.30      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,442.97 1,449.28 1,449.28
1/2 AE 0.50 718.17 741.47 1,482.93
1/4 AE 0.25 362.59 377.74 1,510.98
1/10 AE 0.10 147.14 153.90 1,539.02
Aust. 100 corona 0.98 1,366.29 1,380.29 1,408.17
British sovereign 0.24 332.08 342.08 1,453.19
French 20 franc 0.19 261.81 264.81 1,418.37
Krugerrand 1.00 1,421.93 1,434.93 1,434.93
Maple Leaf 1.00 1,417.30 1,432.30 1,432.30
1/2 Maple Leaf 0.50 806.32 736.21 1,472.42
1/4 Maple Leaf 0.25 357.59 375.12 1,500.46
1/10 Maple Leaf 0.10 148.64 152.85 1,528.51
Mexican 50 peso 1.21 1,682.16 1,696.75 1,407.28
.9999 bar 1.00 1,407.21 1,418.21 1,418.21
SPOT SILVER: 22.47      
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 17,281.55 17,676.55 24.72
US 40% silver 1/2s 0.30 6,259.90 6,629.90 22.47
100 oz .999 bar 100.00 2,247.00 2,322.00 23.22
10 oz .999 bar 10.00 229.70 230.70 23.07
1 oz .999 round 1.00 22.57 23.47 23.47
Am Eagle, 200 oz Min 1.00 23.72 25.47 25.47
SPOT PLATINUM: 1,509.40      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 1,534.40 1,574.40 1,574.40
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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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