The Moneychanger
Daily Commentary
Thursday, 11 June a.d. 2015 Browse the commentary archive

Daddurn! Sun went down and rose up again, & I didn't get no 40 acres & ne'er a mule! I reckon yesterday's supposed deal between the Greeks & Germans warn't the Millennium after all.

Fact is, today the IMF withdrew from negotiations with Greece because they have "major differences." Still, that didn't pull the plug on US, German, English, or French stocks. Belief in the arrival of the Millennium dies hard-- ev'rybody wants 40 acres & a mule free.

Tell y'all the truth, I've had a double gutful of the Greece crisis, banks, central banks, & governments meddling in my life & everybody else's, stomping on productive folk & feeding a lot of slop hogs who never worked a day nor hit a lick at a snake in all their lives, other than working at developing their inside contacts. I'd bet a dollar to a donut that if we took all those folks running things, the politicians & central bank bureaucrats & academics & the government bureaucrats & the watchers, sniffers, planners, regulators, & controllers & locked 'em up on Madagascar for a year, from the presidents all the way down through the third deputy number cruncher, at the end of that year the whole world would be having fun & making money, there wouldn't be any wars, and the bureaucrats would have eaten up all the lemurs and starting to eat each other. I swan, I'd do it, but it'd be just too mean to the native Madagascaranians.

But till that happy day when Providence rids us of all these ticks, chiggers, slugs,roundworms, & tapeworms, let's get back at it. We are, after all, the productive folks and producing is what we do, dumb as that makes us look to these leeches.

Scrofulous US dollar index today managed to rise 30 basis points (0.32%) to 94.95. The nasty thing managed to touch its 20 DMA up above (95.65), but closed little higher than it opened. Momentum is clearly down, with no sign of turning around yet. We all know the ultimate fate of the US dollar, the same fate that has claimed every other fiat currency in history: it will abolish itself. But in the shorter term here the question is, whether the uptrend from July 2014 marked the beginning of a lasting uptrend, or was just a short term revival, like a dying person sitting up in bed suddenly.

The euro, the Frankencurrency stitched together from good body parts, not so good body parts, and some body parts already attracting bugs & carrion eaters, could not rise to any occasion today. It lost 0.47% to $1.1272, painting a trendless and pointless chart.

That yen that gapped up so boldly yesterday fell just as cravenly today. Lost 0.55% to 81.07 and filled in most of the gap as it fell through the sky. Is it possible that the Japanese rulers are even more lame-brained than ours & the Europeans? Don't seem possible.

Stocks showed little signs of life today. Dow rose 38.97 (0.22%) to 18,039.37 while the S&P500 rose 0.17% or 3.66 to 2,108.86. Odd, stopped again at that 18,035-40 range where its lingered so often before. Stocks could make a new high from here, as the supply of suckers to buy them is virtually unlimited, which reminds me of a market proverb: "In a bear market, money returns to its rightful owner."

Both indices did close above their 50 DMA's, but on falling volume.

The Dow in Gold is bumping against its top gator jaw again. Closed at G$315.87 gold dollars (15.28 oz). Before this month ends sudden weakness in gold met by strength in stocks might even take it above that top jaw. I will not be shaken. It's gator jaws, a broadening top, the slowest & most maddening chart pattern there is.

Dow in silver closed at S$1,461.38 (1,130.29 troy ounces), still a long piece from the top gator jaw.

With Korea shutting down for fear of Middle Eastern Respiratory Syndrome (MERS), here's a suggestion that will relieve your mind for your family and you: Vitamin C, especially liposomal Vitamin C. I'm only a nat'ral born durn fool from Tennessee, but I take a MINIMUM 6 grams every day, & prefer 8 - 10g. Knock back three or four of those twice a day when you feel sick, & it'll tune you right up.

Somebody's playing games with silver -- down 2/10 cent, up 3/10 cent, up today 1/10 cent? The range was actually 27 cents, which ain't too lively, but these closes are bogus as a Republican senator. Whoops, make that a Democratic senator. Whoops, leave 'em both in.

Anyway, silver closed today up 1/10 cent at 1595.3 while gold tumbled $6.20 back down toward the bottom of its recent range & ended Comex at $1,179.90. (Intraday low for the move was $1,162.10 on 5 June.)

Both silver & gold are floating beneath their 20 & 50 day moving averages. That's not a recipe for longevity & success. Gold needs to climb above $1,200 and silver above 1640c or they risk tumbling back to the December lows.

I have to watch and wait here.

Who put THAT there? On 11 June 1770 Captain James Cook discovered the Great Barrier Reef off Australia when he ran aground on it.

On 11 June 1776 the American Continental Congress formed a committee to draft a Declaration of Independence from Britain. Since most Americans don't know sic 'em from come here about history, y'all may be surprised to learn that the Declaration of Independence was not a popular move. For most of the war no more than 25% and sometimes less than 10% of the people supported independence & the revolutionary government, depending on its fortunes. Then ask yourself, "How could someone like George Washington, who was literally risking a noose as well as loss of all his substantial property, keep on fighting?" How could someone love liberty that much? And what would Washington & the rest think of those corrupt, arrogant tyrants that rule us today, when they wouldn't even put up with a little tax on tea?

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
11-Jun-15 Price Change % Change
Gold, $/oz 1,179.90 -6.20 -0.52%
Silver, $/oz 15.95 0.00 0.01%
Gold/Silver Ratio 73.961 -0.393 -0.53%
Silver/Gold Ratio 0.0135 0.0001 0.53%
Platinum 1,104.70 -10.00 -0.90%
Palladium 742.60 -0.40 -0.05%
S&P 500 2,108.86 3.66 0.17%
Dow 18,039.37 38.97 0.22%
Dow in GOLD $s 316.05 2.33 0.74%
Dow in GOLD oz 15.29 0.11 0.74%
Dow in SILVER oz 1,130.78 2.37 0.21%
US Dollar Index 94.95 0.30 0.32%
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: 1,180.30      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,212.17 1,221.61 1,221.61
1/2 AE 0.50 601.44 622.61 1,245.22
1/4 AE 0.25 303.67 317.21 1,268.82
1/10 AE 0.10 123.83 129.24 1,292.43
Aust. 100 corona 0.98 1,151.15 1,160.15 1,183.58
British sovereign 0.24 279.93 292.93 1,244.38
French 20 franc 0.19 222.01 226.01 1,210.58
Krugerrand 1.00 1,195.64 1,205.64 1,205.64
Maple Leaf 1.00 1,188.30 1,204.30 1,204.30
1/2 Maple Leaf 0.50 678.67 619.66 1,239.32
1/4 Maple Leaf 0.25 300.98 315.73 1,262.92
1/10 Maple Leaf 0.10 125.11 128.65 1,286.53
Mexican 50 peso 1.21 1,411.59 1,422.59 1,179.88
.9999 bar 1.00 1,184.43 1,192.30 1,192.30
SPOT SILVER: 15.97      
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 12,129.98 12,487.48 17.47
US 40% silver 1/2s 0.30 4,517.93 4,667.93 15.82
100 oz .999 bar 100.00 1,586.50 1,636.50 16.37
10 oz .999 bar 10.00 158.65 164.15 16.42
1 oz .999 round 1.00 16.07 16.57 16.57
Am Eagle, 200 oz Min 1.00 17.47 18.32 18.32
SPOT PLATINUM: 1,104.70      
Plat. Platypus 1.00 1,119.70 1,149.70 1,149.70
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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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