The Moneychanger
Daily Commentary
Tuesday, 17 February a.d. 2015 Browse the commentary archive

I've been iced in for nearly two days, living out here past where the pavement ends and you have to order sunlight from Sears & Roebuck. Did manage to get out late today, but without guilt can say I enjoyed the vacation & solitude with my dear wife and a roaring fire.

Greece, with 2.1% of the European Union population & 1.4% of EU gross domestic product, is trying to throw the EU banks with political jujitsu. Greece will no doubt get a lesson in who rules the EU & the world, namely, the banks.

Greece also offers an object lesson in government fecklessness & stupidity. Governments ruin not only economies, but whole peoples as well. You can put almost any Greek down anywhere in the developed world except Greece, and he'll start a business & get rich. At home, government wrecks them. Maybe all the Greeks ought to move to Australia, New Zealand, & Tennessee, and leave Greece to the refugee Syrians & Albanians. Let the banks try to collect from them.

Until nearly 1:00 p.m. stocks were underwater, but they finished the day (he noted without comment about help from the NGM) higher. Dow gained a miniscule 28.23 (0.16%) to 18,047.58 while the S&P500 made a new high by a few points, ending up 3.35 (016%) at 2,100.34.

Soon a bogus announcement will be made about a bogus deal with the Greeks that will furnish the excuse for yet higher stock prices. We're going to get another little run up here, but growing more attenuated all the time, rising on falling volume, making new highs by half millimeters.

Dow in gold jumped 1.71% to G$308.63 gold dollars (14.93 troy oz). Dow in silver leapt 5.33% to S$1,416.78 silver dollars (1,095.79 troy oz). Remains within the maddening gator jaws, headed toward the top jaw. This tedious, delayed up & down characterizes these formations, but they break reliably down -- eventually.

US dollar index confirmed today its breakdown on the 12th by dropping again, 11 basis points (0.12%) to 94.11. That leaves it firmly beneath the 20 DMA (94.45) & seeking lower levels.

None of that helped the euro much. It rose 0.21% to $1.1414, which, I confess, is above its 20 DMA ($1.1371) but sure inspires no one by its chart. It has formed an even-sided triangle, but needs a break above $1.1500 to prove any upward inclination.

Yen dropped 0.36% to 83.37. Broke down 7 days ago but now drifting aimlessly sideways

WTIC is clearly trending up, founded on a double bottom. Has now formed a flat topped rising triangle, which usually breaks out skyward. Rose 1.08% to $53.24/barrel.

Ten year treasury not yield rose sharply today, 6.14% to 2.145%. That means bonds are dropping, but why? No safe haven bid? Investors switching from bonds to stocks -- in large numbers?

Silver & gold took sharp dives today. Silver lost 91.6 cents (5.3%) to 1636.2 cents, with a low at 1626. Gold fell $18.4 (1.5%) to $1,208.10.

All that sounds terrible, but doesn't look terrible on a chart. Gold Remains above the twice-proven uptrend line from the November bottom, which tomorrow stands at $1,195. Barely below the neckline of the September - December upside down head and shoulders. Also touching the bottom Bollinger band, which suggests it's time to think about buying. Chart at

Friday silver had broken out of that falling wedge, and today gave back all that gain and more, falling back into the wedge and touching its bottom Bollinger band. Need to see one day closing higher to buy it. Chart at

Gold/Silver ratio stands at 73.836, and is remaining beneath the downtrend line from its diamond reversal. Choppy, confused, but trending down as it should for a metals rally. Chart at

Although the mayor had declared it an open city and surrendered under the laws of war, on 17 February 1865 Federal troops under General John Sherman burned down Columbia, South Carolina.

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
17-Feb-15 Price Change % Change
Gold, $/oz 1,208.10 -18.40 -1.50%
Silver, $/oz 16.36 -0.92 -5.30%
Gold/Silver Ratio 73.836 2.849 4.01%
Silver/Gold Ratio 0.0135 -0.0005 -3.86%
Platinum 1,180.00 -30.50 -2.52%
Palladium 783.55 -11.20 -1.41%
S&P 500 2,100.34 3.35 0.16%
Dow 18,047.58 28.23 0.16%
Dow in GOLD $s 308.81 5.11 1.68%
Dow in GOLD oz 14.94 0.25 1.68%
Dow in SILVER oz 1,103.02 60.11 5.76%
US Dollar Index 94.11 -0.11 -0.12%
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: 1,206.20      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,233.94 1,248.42 1,248.42
1/2 AE 0.50 620.68 636.27 1,272.54
1/4 AE 0.25 310.34 324.17 1,296.67
1/10 AE 0.10 126.55 132.08 1,320.79
Aust. 100 corona 0.98 1,174.04 1,186.04 1,210.00
British sovereign 0.24 285.64 297.64 1,264.41
French 20 franc 0.19 226.89 230.00 1,231.91
Krugerrand 1.00 1,220.67 1,230.67 1,230.67
Maple Leaf 1.00 1,214.20 1,231.20 1,231.20
1/2 Maple Leaf 0.50 693.57 633.26 1,266.51
1/4 Maple Leaf 0.25 307.58 322.66 1,290.63
1/10 Maple Leaf 0.10 127.86 131.48 1,314.76
Mexican 50 peso 1.21 1,445.47 1,469.47 1,218.77
.9999 bar 1.00 1,210.42 1,222.20 1,222.20
SPOT SILVER: 16.43      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 24.00 27.00 35.29
VG+ Peace dollar 0.77 19.00 22.50 29.41
90% silver coin bags 0.72 12,387.38 12,744.88 17.83
US 40% silver 1/2s 0.30 4,653.63 4,803.63 16.28
100 oz .999 bar 100.00 1,632.50 1,692.50 16.93
10 oz .999 bar 10.00 169.25 170.25 17.03
1 oz .999 round 1.00 16.53 17.03 17.03
Am Eagle, 200 oz Min 1.00 18.18 19.43 19.43
SPOT PLATINUM: 1,180.00      
Plat. Platypus 1.00 1,205.00 1,245.00 1,245.00
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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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