The Moneychanger
Daily Commentary
Thursday, 1 August a.d. 2013 Browse the commentary archive

I badly misspoke myself yesterday, leaving a false impression. My wife does not "do stuff behind my back." She's the least sneaky person in the world. Rather, she does things without my knowledge, because she has her duties and I have mine, & I don't tell her how to do hers anymore than she tells me how to do mine.

Her thriftiness led her to the Amazon Prime subscription: free shipping. And besides, we live so far out we have to shop by internet. By such trifles are we all heedlessly ensnared.

No more than my wife do I ponder beforehand what it means to build up one company as the centralized source of everything. Centralization leads to fragility & Instability & makes inevitable catastrophic collapse when the center fails. Decentralization leads to strength, because if one source fails, another is ready to replace it. Stability -- not to mention delight -- lies in competition & diversity.

But the greater problem with Wal-Mart and Amazon centralization is what it does to local communities: it destroys them. Local businesses are driven out. We forget that we cannot prosper ourselves unless we seek our neighbor's prosperity, too.

It turns out, the bottom line isn't the bottom line, unless you are content to live in a world without love.

And, I left the wrong impression by saying that the movie Idiocracy is the most accurate prophecy of America's future. It's possible, but I don't believe that. Rather, my hope & the focus of my work is the rebuilding after the present system collapses. The financial and economic system is already collapsing, although slowly. What are we building, right now, to replace it? Not by changing Washington or Wall Street, but by changing ourselves & our own communities. By living not in greed, but in love -- not the sappy affection most people mean by "love," but doing justice & kindness toward our neighbors, even economically.

For that re-building that I urge people to buy gold & silver, so that on the other side of the present system's destruction, they will have capital to re-build.


The jubilatin' became jinral today as the Dow Industrials, the Dow Transports, & the S&P500 all made new highs. Dow theory says that the two indices must confirm each other in an uptrend, & that happened today,. The casino is getting HOT!

Dow Industrials finished up 128.48 (0.83%) at 15,628.02. S&P500 broke 1,700 & rose 21.14 (1.25%) to 1,706.87. Happy Days are here again.

Metals were weak today while stocks waxed mighty, but it changed the Dow in Metals only slightly. Dow in Gold rose 0.94% to 11.921 oz (G$246.42), up to the 20 DMA, but still below the triangle breakdown. Dow in silver (DiSoz) closed 796.74 oz, up 0.84%. It's a bit complicated to explain, but the DiSoz broke down in late July out of an even-sided triangle. However, now it seems I ought to re-draw that triangle to include the 22 July low, so we have a long flat-bottomed triangle that is still developing.

The Euro central bank left everything unchanged today when its Idiocrats made their announcements. Traders dumped euros and ran for dollars as the interest rate in dollars jumped up 5%. And contrary to Comrade Draghi's wishes, Euro interest rates rose, too. US dollar index rose a generous 68 basis points (0.87%) and crossed above the Across the Atlantic gravity caught up with the euro and dragged it down 0.68% to $1.3212. I'm out of metaphors when it comes to the yen, which fell like a lump in a churn, 1.61% to 100.54. In the stable of spavined, broken down nags that is the world of fiat currencies, the dollar can limp the fastest.

Gold was ground down in early NY trading, went sideways most of the day, then closed Comex down $1.40 at $1,311.00 Silver lost 2/10 cent to 1961.5c.

In the aftermarket gold is trading now at $1,304.50 & silver at 1957, having dropped in the aftermarket. You can say that looks weak, but as long as gold holds on above $1,300, I'm not vexed. Imagine how many smart fellows, still covered with the blood of the last few months, are waiting at $1,325, $1,330 etc. to short gold. Whatever you see, it's doing it against that hostile background.

I think gold might be fooling everybody. If it holds above that $1,300 tomorrow, it will fool 'em.

The name of that book I forgot when I wrote about Gettysburg recently was "Lost Triumph: Lee's Real Plan at Gettysburg & Why it Failed" by Tom Carhart. Good book.

On 1 August 1794 the Whiskey Rebellion began in what was then the west of the United States, namely, western Pennsylvania. Washington's treasury secretary, Alexander Hamilton, wanted the federal government to assume the states' war debts (does this sound like there were speculators hiding in the woodwork somewhere?) and found a national debt, so he promoted an excise on distilled spirits. Western farmers, many of whom had fought in the Revolution, saw themselves right back in their pre-revolutionary position. It was worse because the only way they could convert their corn crop to something salable and transportable was to distill it. In 1792 the protestors tarred and feathered a revenue collector. Other potential tax collectors took the hint, & the tax wasn't collected in 1791 and 1792. The rebellion spread to the western counties of the other Appalachian states, including Maryland, Virginia, North Carolina, South Carolina, and Georgia. Nobody would collect the tax in Kentucky or prosecute evaders. Things continued to escalate. Opposition grew. Even those who complied with the tax had trouble. On August 1, 7,000 people gathered near Pittsburg. Radicals were talking of seceding. Goaded by Hamilton, Washington led a militia army of 12,950 to suppress the rebellion. In October 1794 the rebellion collapsed in the face of the invasion.

When Jefferson assumed office the hated whiskey tax was repealed, never to reappear until Lincoln needed to raise money to wage his genocide against the South. Since that time, whiskey-making has been a sort of avocation in many parts of the South, where the Whiskey Rebellion ain't over yet. (Y'all can find a splending Murray Rothbard article about the Whiskey rebellion at

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

— Franklin Sanders, The Moneychanger

Your source for gold and silver. Read our latest reviews and testimonials.
Market Snapshot See more charts and market data
1-Aug-13 Price Change % Change
Gold, $/oz 1,311.00 -1.40 -0.11%
Silver, $/oz 19.62 -0.00 -0.01%
Gold/Silver Ratio 66.837 -0.065 -0.10%
Silver/Gold Ratio 0.0150 0.0000 0.10%
Platinum 1,442.90 14.50 1.02%
Palladium 730.95 5.50 0.76%
S&P 500 1,706.87 21.14 1.25%
Dow 15,628.02 128.48 0.83%
Dow in GOLD $s 246.42 2.29 0.94%
Dow in GOLD oz 11.92 0.11 0.94%
Dow in SILVER oz 796.74 6.63 0.84%
US Dollar Index 82.35 0.68 0.83%
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SPOT GOLD: 1,308.30      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,335.77 1,350.82 1,350.82
1/2 AE 0.50 666.72 689.15 1,378.29
1/4 AE 0.25 333.36 351.12 1,404.46
1/10 AE 0.10 137.27 143.26 1,432.59
Aust. 100 corona 0.98 1,275.98 1,286.98 1,312.98
British sovereign 0.24 309.82 321.82 1,367.13
French 20 franc 0.19 244.26 251.26 1,345.79
Krugerrand 1.00 1,325.31 1,337.31 1,337.31
Maple Leaf 1.00 1,323.30 1,338.30 1,338.30
1/2 Maple Leaf 0.50 752.27 686.86 1,373.72
1/4 Maple Leaf 0.25 333.62 349.97 1,399.88
1/10 Maple Leaf 0.10 138.68 142.60 1,426.05
Mexican 50 peso 1.21 1,569.40 1,580.42 1,310.79
.9999 bar 1.00 1,312.88 1,323.88 1,323.88
SPOT SILVER: 19.58      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 25.50 28.00 36.60
VG+ Peace dollar 0.77 21.50 25.00 32.68
90% silver coin bags 0.72 15,747.88 16,147.88 22.58
US 40% silver 1/2s 0.30 5,582.88 5,732.88 19.43
100 oz .999 bar 100.00 1,967.50 2,032.50 20.33
10 oz .999 bar 10.00 196.75 203.25 20.33
1 oz .999 round 1.00 19.68 20.43 20.43
Am Eagle, 200 oz Min 1.00 20.83 22.58 22.58
SPOT PLATINUM: 1,442.90      
Plat. Platypus 1.00 1,452.90 1,482.90 1,482.90
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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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