The Moneychanger
Daily Commentary
Wednesday, 4 February a.d. 2015 Browse the commentary archive

With the deadline for signing up for Obamacare looming, y'all might want an alternative. My wife & I pay about $340 a month with a medical-need sharing group, Samaritan Ministries, www.samaritanministries.org. It's not insurance, but a fellowship that shares medical needs. Our check goes directly to the person with the need, not to an insurance company. Doesn't cover pre-existing conditions, but neither does insurance. What it does cover is better than most insurance. And it works. I know people who have had needs of tens of thousands of dollars met. Two catches: you must be a church-going Christian and you can't smoke. Samaritan was grandfathered in to the Obamacare law, so it qualifies as "insurance" for that purpose.

All the Wise Ones & gurus this evening want to blame the stock market's fainting spell today on the ECB. Seems the criminals at the ECB announced they would not accept Greek bonds for funding banks (I think that means that they are refusing to buy bonds from banks). That, say the Wise Ones, threw ice-water on the market's naked backs & caused every index except the Dow to close lower. S&P500 fell 8.52 (0.42%) to 2,041.51 while the Dow rose a microscopic 6.62 (0.04%) to 17,673.02.

Now MY explanation: Indices drew near that downtrend line from the December highs and swooned like Superman next to a bushel full of Kryptonite, for LO! That is what happened. Dow closed right on its 20 DMA, S&P500 below its 50 DMA. For now at least, the downtrend (& my explanation) hold.

Dow in Gold and Dow in Silver hooked down today, but not enough to change anything.

That news of trouble in Euro-Bank-Land sent the euro down & the US dollar index up. Course, one might also interpret that as the dollar index bouncing off its 20 DMA (at 93.64). Gained 50 basis points (0.54%) to 94.25. Still broken down, still has lower prices written all over its face. But with currencies, who knows? Government can throw a surprise party any time changing everything. That statement is so intrinsically hateful & stupid I can hardly type it, but it's true. Goofy world where government & central banks determine the economic destiny of us innocent sufferers.

Euro lost 0.88% to $1.1534. Yen gained 0.3% to 85.32. Who cares? Ain't neither one of 'em worth the paper they're printed on, nor the US$ neither!

Oil wilted today, losing 6.05% to close at $48.45.

Having (it appears) finished the worst of their correction, silver & gold rose today gold $4.10 (0.33%) to $1,263.80 & silver 7.4 cents (0.43%) to 1737.9c. My mama won't let me say, "I told y'all so."

Gold/Silver ratio fell again to 72.720, right on its 20 DMA. Close below that mark confirms momentum downturn already begun.

Gold has bounced off its 200 DMA enough to make a reversal believable. Today it also closed right at its 20 DMA, which has crossed above the 200 DMA. That cross witnesses that momentum is upward.

Silver has handily bounced off the uptrend line from the 1 December 1 low, and now needs to conquer 1775c.

Right here, buying beats indecision hands down.

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
4-Feb-15 Price Change % Change
Gold, $/oz 1,263.80 4.10 0.33%
Silver, $/oz 17.38 0.07 0.43%
Gold/Silver Ratio 72.720 -0.074 -0.10%
Silver/Gold Ratio 0.0138 0.0000 0.10%
Platinum 1,240.90 3.70 0.30%
Palladium 790.50 4.20 0.53%
S&P 500 2,041.51 -8.52 -0.42%
Dow 17,673.02 6.62 0.04%
Dow in GOLD $s 289.08 -0.83 -0.29%
Dow in GOLD oz 13.98 -0.04 -0.29%
Dow in SILVER oz 1,016.92 -3.97 -0.39%
US Dollar Index 94.25 0.50 0.53%
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: 1,265.20      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,291.77 1,309.48 1,309.48
1/2 AE 0.50 644.74 670.56 1,341.11
1/4 AE 0.25 325.53 340.02 1,360.09
1/10 AE 0.10 132.74 139.17 1,391.72
Aust. 100 corona 0.98 1,231.47 1,240.47 1,265.53
British sovereign 0.24 300.06 305.06 1,295.93
French 20 franc 0.19 237.98 241.98 1,296.11
Krugerrand 1.00 1,281.65 1,291.65 1,291.65
Maple Leaf 1.00 1,280.20 1,295.20 1,295.20
1/2 Maple Leaf 0.50 727.49 664.23 1,328.46
1/4 Maple Leaf 0.25 322.63 338.44 1,353.76
1/10 Maple Leaf 0.10 134.11 137.91 1,379.07
Mexican 50 peso 1.21 1,513.12 1,524.12 1,264.10
.9999 bar 1.00 1,269.63 1,281.20 1,281.20
SPOT SILVER: 17.33      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 23.00 26.00 33.99
VG+ Peace dollar 0.77 19.00 22.00 28.76
90% silver coin bags 0.72 13,070.20 13,427.70 18.78
US 40% silver 1/2s 0.30 4,920.60 5,070.60 17.19
100 oz .999 bar 100.00 1,723.00 1,783.00 17.83
10 oz .999 bar 10.00 178.30 179.30 17.93
1 oz .999 round 1.00 17.43 17.98 17.98
Am Eagle, 200 oz Min 1.00 18.83 19.68 19.68
SPOT PLATINUM: 1,240.90      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 1,265.90 1,305.90 1,305.90
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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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