The Moneychanger
Daily Commentary
Tuesday, 3 March a.d. 2015 Browse the commentary archive

Sorry I missed y'all yesterday evening, but Susan & I had to drive down to Corinth to see a friend there having sudden heart surgery today. Then I had to drive up to Kentucky this morning with my son today to pick up two Hereford sows. I've driven through more blindin' rain than Noah in the last 24 hours, so I'm going to make this fast & straight.

Stocks are sicker'n e'er a dog. That jubilatin'-est high lately may have been the Big One. Dow below 18,050 turns it seriously down. After losing 85 yesterday, Dow lost another 106.47 (0.58%) to 18,096.90 today. S&P500 lost 9.61 yesterday and another 9.25 today to end up 0.8955 lighter in two days for a close at 2,098.53.

In spite of gold & silver's weakness the last two days, both the Dow in Gold & Dow in Silver have jiggled down again. Could be a top but to early to say.

US dollar index mildly surprised me with a 54 basis point (0.56%) rise to 95.99, a scootch higher than the January high at 95.85. As yet that sayeth naught, because it could be a double top or it even could be another leg up. I doubt that, but it's possible. Euro hit a new low at $1.1079 (-0.86%).

WTIC rose 1.75% to $51.53/barrel. Refusing to break down. Maybe oil has sunk all it intends to.

Yesterday gold sank $3.70 & today another $3.40 to wind up Comex at $1,200.60. Silver lost 14.9 cents on Tuesday and 12.6 cents today & finished at 1613.2c. Gold/Silver ratio rose to 74.424, poking into the downtrend line.

They might as well have closed down the silver & gold markets today & stayed home and drunk martinis. Silver had a 30 cent range with a 1605c low, Gold ranged over a thrilling $10.70.

That left Gold closing barely below the uptrend line I've been watching, the one climbing up off the November low. Yet it showeth no ambition to fall further. Silver remained above the trend line I'm concerned about, a line connecting the shoulders of that upside-down head and shoulders formed November through December. Tomorrow that stands at 1605c.

Both metals lack momentum and direction, except that since the 23 January tops their trend has been down. Unless they gainsay that some way, it will remain down. "Gainsay" means gold closes above $1,220 and silver above 1680c.

World right now is like a ball a kid throws straight up in the air. Y'all know how it seems to hang there just a split second at the top of its arc, right before it comes crashing back down and hits the kid in the face? It's that kind of pause. I've been reading somebody lately who has shed new light on the monetary & financial questions for me. First new viewpoint I've seen in a long time, and it shocked me. That has returned me to a longer term outcome, & I simply can't avoid saying it: the central banking monetary system is doomed. Just like that ball I mentioned above, it didn't come down in 2008 & it has paused in the air, but you trust gravity and not central bankers, because that ball is coming down. The world will change suddenly and painfully.

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-Mar-15 Price Change % Change
Gold, $/oz 1,200.60 -3.40 -0.28%
Silver, $/oz 16.13 -0.13 -0.78%
Gold/Silver Ratio 74.424 0.368 0.50%
Silver/Gold Ratio 0.0134 -0.0001 -0.49%
Platinum 1,182.80 -7.90 -0.66%
Palladium 830.40 -0.75 -0.09%
S&P 500 2,098.53 -9.25 -0.44%
Dow 18,096.90 -106.97 -0.59%
Dow in GOLD $s 311.59 -0.96 -0.31%
Dow in GOLD oz 15.07 -0.05 -0.31%
Dow in SILVER oz 1,121.80 2.11 0.19%
US Dollar Index 95.99 0.54 0.57%
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: 1,200.80      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,227.22 1,242.83 1,242.83
1/2 AE 0.50 617.90 633.42 1,266.84
1/4 AE 0.25 308.95 322.72 1,290.86
1/10 AE 0.10 125.98 131.49 1,314.88
Aust. 100 corona 0.98 1,167.61 1,176.61 1,200.38
British sovereign 0.24 284.79 289.79 1,231.05
French 20 franc 0.19 225.87 229.87 1,231.23
Krugerrand 1.00 1,216.41 1,226.41 1,226.41
Maple Leaf 1.00 1,208.80 1,225.80 1,225.80
1/2 Maple Leaf 0.50 690.46 630.42 1,260.84
1/4 Maple Leaf 0.25 306.20 321.21 1,284.86
1/10 Maple Leaf 0.10 127.28 130.89 1,308.87
Mexican 50 peso 1.21 1,437.55 1,448.55 1,201.42
.9999 bar 1.00 1,205.00 1,216.80 1,216.80
SPOT SILVER: 16.27      
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 12,383.80 12,741.30 17.82
US 40% silver 1/2s 0.30 4,607.90 4,757.90 16.13
100 oz .999 bar 100.00 1,617.00 1,677.00 16.77
10 oz .999 bar 10.00 167.70 168.70 16.87
1 oz .999 round 1.00 16.37 16.87 16.87
Am Eagle, 200 oz Min 1.00 17.77 18.57 18.57
SPOT PLATINUM: 1,182.80      
Plat. Platypus 1.00 1,197.80 1,227.80 1,227.80
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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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