The Moneychanger
Daily Commentary
Monday, 13 April a.d. 2015 Browse the commentary archive

Mondays I don't think too well. Still under the spell of a lazy weekend. Yet think I must, as I some thinkworthy stuff happened today.

Gold & silver squandered all Friday's gains by not improving them today. Gold lost $5.30 to close portentously below $1,200 at $1,199.30. Silver lost 9 cents on the Comex close, leaving it at 1628. In fact, that close was a greater loss because Friday's aftermarket saw it over 1650c.

Watch the uptrend line from Gold's January low at $1,141.60. Friday gold reversed its fall there. Today it stopped falling there. It's signalling that a break of that line brings a retest of January lows, but if that low holds, gold rallies further.

Silver wiped out most but not all of Friday's gains. From the December low at 1415.5c through the March low at 1526c the uptrend line today now hits 1560c or so. If silver fails to stop here around Thursday's 1610.5c intraday low, it will sink to that post-December uptrend line. MACD is voting for lower prices.

US dollar index, not for much evident reason, rose 14 basis points (0.14%) to 99.74. If I covered the label on the dollar index chart and didn't know it was something I despised, I would say the breakout last week will carry it to the last high (100.71), where it will fail.

A "rationalization" is a reason discovered after the fact. Investment analysts and commentators make a living peddling rationalizations, telling you AFTER a trend has begun why it must continue FOREVER Most everybody thinks linearly, that is, they look at what's happening today and project it out in a straight line indefinitely into the future. Trouble is, the world doesn't work that way. Change is the rule, and sometimes change so all-encompassing that you can never recover afterwards. Ask the 1915 buyers of Austrian or German government bonds. Or the 1862 buyers of Confederate States bonds.

I am thinking, of course, about the scrofulous, parasitical, plumb yellow-evil US dollar. Right now the rationalizers and trend followers have a thousand reasons why it must keep rising, but in truth it's as spongy rotten as the yen & euro, & way more vulnerable to revulsion from a world worn out by US arrogance.

But what do I know? I'm just a nat'ral born durned fool from Tennessee where we make wine out of muscadines and whiskey out of corn. We just never learned to make a silk purse out of sow's ear.

Ominous day for stocks. Ravens flew over in flocks, buzzards circled, & the sheep livers looked awful. After Friday's gain at the end of a tough week, stocks lost all inertia from dawn today. Simply fell down a steep hillside all day. Again, failing to improve gains shows weakness.

Dow Industrials gave back 80.61 (0.45%) & the S&P 500 lost 9.63 (0.46%) to close 2,092.43. Lo, behold the chart! Both indices rose to their upper channel boundary line and wilted like Bela Lugosi in that 1931 film Dracula when he meets a crucifix. Now that issues no ironclad guarantee they won't rise again, but it does create a presumption of future failure.

Here's an article on the 60th anniversary of the 1955 introduction of the Salk polio vaccine, This is the standard uncritical paean with a bare mention of the mercury containing preservative thimersal that some maintain is the cause of autism. No mention at all is made that in 1948 Dr. Frederick Klenner treated polio successfully in 60 children by massive doses of IV vitamin C & cured them all, or that he presented work that to the AMA annual meeting in 1949. It's like the motto of the New York Times: "All the news that fits."

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
13-Apr-15 Price Change % Change
Gold, $/oz 1,199.30 -5.30 -0.44%
Silver, $/oz 16.28 -0.09 -0.55%
Gold/Silver Ratio 73.667 0.081 0.11%
Silver/Gold Ratio 0.0136 -0.0000 -0.11%
Platinum 1,153.50 -16.50 -1.41%
Palladium 771.10 -4.65 -0.60%
S&P 500 2,092.43 -9.63 -0.46%
Dow 17,977.04 -80.61 -0.45%
Dow in GOLD $s 309.86 -0.02 -0.01%
Dow in GOLD oz 14.99 -0.00 -0.01%
Dow in SILVER oz 1,104.24 1.15 0.10%
US Dollar Index 99.74 0.14 0.14%
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: 1,199.40      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,224.59 1,241.38 1,241.38
1/2 AE 0.50 611.18 632.68 1,265.37
1/4 AE 0.25 308.59 322.34 1,289.36
1/10 AE 0.10 125.83 131.33 1,313.34
Aust. 100 corona 0.98 1,169.77 1,178.77 1,202.58
British sovereign 0.24 284.46 297.46 1,263.62
French 20 franc 0.19 225.61 229.61 1,229.82
Krugerrand 1.00 1,211.39 1,221.39 1,221.39
Maple Leaf 1.00 1,207.40 1,223.40 1,223.40
1/2 Maple Leaf 0.50 689.66 629.69 1,259.37
1/4 Maple Leaf 0.25 305.85 320.84 1,283.36
1/10 Maple Leaf 0.10 127.14 130.73 1,307.35
Mexican 50 peso 1.21 1,432.98 1,443.98 1,197.63
.9999 bar 1.00 1,203.60 1,211.40 1,211.40
SPOT SILVER: 16.26      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 23.00 26.00 33.99
VG+ Peace dollar 0.77 18.50 21.00 27.45
90% silver coin bags 0.72 12,158.58 12,516.08 17.51
US 40% silver 1/2s 0.30 4,603.48 4,753.48 16.11
100 oz .999 bar 100.00 1,615.50 1,680.50 16.81
10 oz .999 bar 10.00 161.55 168.05 16.81
1 oz .999 round 1.00 16.36 16.86 16.86
Am Eagle, 200 oz Min 1.00 17.26 18.61 18.61
SPOT PLATINUM: 1,153.50      
Plat. Platypus 1.00 1,168.50 1,198.50 1,198.50
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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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