The Moneychanger
Weekly Commentary
Friday, 28 March a.d. 2014 Browse the commentary archive
Here's the weekly scorecard:
  21-Mar-14 28-Mar-14 Change % Change
Silver, cents/oz. 2,028.60 1,977.20 -51.40 -2.5
Gold, dollars/oz. 1,336.00 1,293.80 -42.20 -3.2
Gold/silver ratio 65.858 65.436 -0.422 -0.6
Silver/gold ratio 0.0152 0.0153 0.0001 0.6
Dow in Gold Dollars (DIG$) 252.25 260.80 8.55 3.4
Dow in gold ounces 12.20 12.62 0.41 3.4
Dow in Silver ounces 803.65 825.56 21.92 2.7
Dow Industrials 16,302.77 16,323.06 20.29 0.1
S&P500 1,866.72 1,857.32 -9.40 -0.5
US dollar index 80.25 80.33 0.08 0.1
Platinum 1,435.50 1,404.70 -30.80 -2.1
Palladium 788.75 774.10 -14.65 -1.9

Bad week for metals, middlin' mediocre week for stocks, might have been a good week for the US dollar.

Stocks have been treading water this week, up & down in the same spot, over & under the 20 DMA without being above to make up their mind. S&P500 broke the bottom boundary of an even-sided triangle yesterday, but that breakdown proved false when it reversed today & closed up within the triangle.

Dow added 58.83 (0.36%) to close 16,323.06. S&P500 rose 8.58 (0.46%) to 1,857.62.

Dow in metals has that feeling of a fly ball reaching the height of its arc. Dow in Gold rose 0.13% to 12.61 oz ($260.67 gold dollars) but leveled off. I am anticipating a turn, since it stands above its 50 DMA (12.36) which means momentum is up. Dow in silver dipped barely down, down 0.09% to 824.81 oz (S$1,066.42 silver dollars. I may be no better than that ox on his way to slaughter who don't know enough to be afraid, but for some reason these rallying Dow in metals don't disturb me. I expected a sharp rally after that long fall, but don't expect this will last much longer.

Nasty, filthy, noxious, vile, beastly, foul, loathsome, lousy, mephitic, noisome, odious, scrofulous, scurvy, parasitic -- yea, all these describe fiat dollars, yen, & euros. And I'm just warming up my thesaurus here.

US Dollar index is glacially trying to rise. It did manage to stand up off the floor this week, and rose six basis points (0.07%) to 80.33 today. Technically it's trending up, but without any enthusiasm.

Euro broke down sure enough this week. Bounced 0.08% today to $1.3753, but it's plumb broken. Next week should cross below its bunched 20, 50, & 62 day moving averages.

Yen busted its 50 DMA today, falling to 97.27 cents/y100. Still range-bound, trending sideways.

Silver & gold argued with each other today. Gold lost 90 cents to $1,293.80 on Comex. Silver rose 8.2 cents to 1977.2 cents. Ratio fell to 65.436 from yesterday's 65.754.

Both metals are riding their bottom Bollinger Bands, which increases likelihood of a turnaround. Gold today reached $1,286.10, my target for this move and a 50% correction. Silver hit 1958c yesterday and 1962c today, close enough to call my 1950c target met. After Monday both should turn up and leave y'all scratching your heads & twisting your necks around 180 degrees for that perfect hindsight and saying to yourselves, "I KNEW I should have bought some last week."

On 28 March 1818 was born Wade Hampton III, South Carolinian, Confederate general, and with the Redshirts redeemer of South Carolina from Reconstruction. He grew up hunting, and was known for hunting black bears with a knife. Although he was 42 when the war began and had no military experience, he had a natural military genius and, besides Bedford Forrest, was one of only two men without previous military training to achieve Lieutenant General rank.

New Man or same Old Man? I saw an article about Alexander Ulyanov, Lenin's brother who was executed in 1887 for attempting to assassinate the Tsar. He was influenced by Dmitry Pisarev, "a nihilist who wrote of a NEW kind of human being, ascetically dedicated to science and working for the `good of humanity.'" Pisarev wrote, "New Men don't sin and don't repent; they always reflect, and they only make mistakes in calculation, and then correct their errors and avoid repeating them in the future."

Hell hath no fury like a humanitarian who loves all men but no single man. In the name of scientific socialism more than 200 million real, individual men, women, & children were murdered in the 20th century. Those "scientists" promised, and governments promise us still, that science and enlightened government, neutral to morality, will lead us to paradise.

Yet 200 years later, paradise eludes them still.

Most don't know that the 1818 novel & movie "Frankenstein" deal with "science" creating a "New Man." Alas, after all the stitching and lofty promises, only a monster results, and only murder. Turns out that science cannot save us. Worse still, the New Man turns out to be the same Old Man, only without a conscience.

Y'all enjoy your weekend!

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
28-Mar-14 Price Change % Change
Gold, $/oz 1,293.80 -0.90 -0.1
Silver, $/oz 19.77 0.08 0.4
Gold/Silver Ratio 65.436 -0.048 -0.1
Silver/Gold Ratio 0.0153 0.0001 0.4
Platinum 1,404.70 7.50 0.5
Palladium 774.10 13.20 1.7
S&P 500 1,857.62 8.58 0.5
Dow 16,323.06 58.83 0.4
Dow in GOLD $s 260.80 1.15 0.4
Dow in GOLD oz 12.62 0.06 0.4
Dow in SILVER oz 825.56 -0.45 -0.1
US Dollar Index 80.33 0.06 0.1
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: 1,293.80      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,326.15 1,339.08 1,339.08
1/2 AE 0.50 659.33 681.51 1,363.02
1/4 AE 0.25 329.66 347.22 1,388.89
1/10 AE 0.10 135.74 141.67 1,416.71
Aust. 100 corona 0.98 1,261.84 1,270.84 1,296.51
British sovereign 0.24 306.84 311.59 1,323.68
French 20 franc 0.19 243.36 246.40 1,319.78
Krugerrand 1.00 1,308.03 1,318.03 1,318.03
Maple Leaf 1.00 1,308.80 1,323.80 1,323.80
1/2 Maple Leaf 0.50 743.94 679.25 1,358.49
1/4 Maple Leaf 0.25 329.92 346.09 1,384.37
1/10 Maple Leaf 0.10 137.14 141.02 1,410.24
Mexican 50 peso 1.21 1,552.01 1,563.01 1,296.35
.9999 bar 1.00 1,298.33 1,312.80 1,312.80
SPOT SILVER: 19.77      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 26.25 28.25 36.93
VG+ Peace dollar 0.77 22.25 23.75 31.05
90% silver coin bags 0.72 14,957.80 15,207.80 21.27
US 40% silver 1/2s 0.30 5,640.40 5,790.40 19.63
100 oz .999 bar 100.00 1,982.00 2,032.00 20.32
10 oz .999 bar 10.00 198.20 203.20 20.32
1 oz .999 round 1.00 19.87 20.37 20.37
Am Eagle, 200 oz Min 1.00 21.27 22.47 22.47
SPOT PLATINUM: 1,404.70      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Platinum Platypus 1.00 1,419.70 1,436.70 1,436.70
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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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