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

I've been thinking. One reason for the big drops in platinum and especially palladium must be some big seller. Russia produces 75-80% of the world's palladium & 25% of the platinum, & is suffering under Western sanctions. If the Russians are selling palladium to raise money, that might account for that drop.

The futures market proverb says, "Sooner or later everything comes back to physicals." I reckon in the naïve day when that proverb began before manifold manipulations and cash settlement that was true. Still is true,really, for in the end the pricing of everything should refer back to the physical supply.

That's what's getting my attention with physical gold and silver. I see a headline on bulliondesk.com today, "Investors are simply not interested in gold at the present and physical demand is weak." Well, that ain't so in Tennessee, I'll bet you, or in the rest of the US. The premium on US 90% silver coin is right sensitive to silver price, often foreshadowing a fall or rise. Since 1 June it has risen from $1.35 an ounce over spot at wholesale to $3.10 today.

Gold coin premiums generally stay much tamer, but Krugerrands, whose wholesale buy premium has been around 1% over spot forever, have within the last three weeks crept up to 1.7%. Today I got a bad surprise when I tried to order a picayune two dozen Krugerrands and two different wholesalers quoted me two to three week delays. That sort of shortage in the gold coin market hasn't been heard of since the financial crisis of 2008.

The door into physical gold & silver is very, very narrow. It's usually easy to pass through, but when a crowd want through that door, it just clogs up. Best way not to clog with it is to walk through that door before the crowd shows up.

Well, the Greeks took a deal from the Europeans and they won't have to sell their children into slavery to pay the government's debt after all. They will however suffer deep government budget cuts, hefty tax hikes, & have to put big swaths of the country up for sale. One economist said the terms would cause Greece's economy to shrink 10% over the next 3 years, after shrinking 25% since 2008. Lesson is, you can't do business with usurers, but I doubt many folks today can even spell usurers. Loan sharks, for y'all who're wondering what I mean, the loan sharks have Greece by the throat & they're going to break their legs if they don't pay.

"The usurer loves the borrower as the ivy loves the oak."

A thought about price cutters. Folks call us from time to time and ask why we charge a little more than XYZ, the big precious metals dealer on the internet. My short answer is, "I don't aim to be the Wal-Mart of gold & silver." My longer answer is, I want to stay in business & I need to make a living. In the 35 years I've been doing this, I've seen lots of price cutters come & go. I take no pleasure in anyone's trouble, but go look at the Bullion Direct website and read the notice that's been there about a week, "Bullion Direct has experienced significant transactional delays. To avoid further inconvenience or other adverse consequences to our customers, Bullion Direct is suspending it operations as it attempts to resolve these issues." It's been a long bear market.

There's another reason I'm not studying to compete on price: our guidance into those items that net you the most gold and silver for your money, not the most heavily marketed or numismatic items, will usually pay our paltry 3.5% to 1% commission. And we are live human beings, from America, who tailor our service to your needs, not a computer program or a minimum wage order taker. And I don't exaggerate when I tell you that some of our customers over the years have added fifty percent or more to their ounces by following our gold-silver swapping strategy. When you offer people that sort of service, not many complain about 3.5% to 1% commission. But you can't please everybody.

Back to today's markets.

Stocks had as much fun as a wino at happy hour. Dow rose 217.27 (1.22%) to 17,977.68. S&P500 jumped 22.98 (1.11%) to 2,099.60. I reckon they think the Greek settlement will change something, but if they see that they've got better eyes than this nat'ral born durned Tennessee fool. It's just more of the same, not "kick the can" but "kick the debtor & bail out the banks." What happens when one day one of those debtors won't be kicked any more & bites their durned leg? Sinks his teeth in up to the bone? Truth is, NOTHING has been fixed, nothing changed, nothing reformed since 2008. Sooner or later the boil will burst -- on the whole world economy. And the predators had better pray they don't become the prey. (Back off! I've got more metaphors in here & I'll use 'em!)

Euro fell 1.38% to $1.1007, I reckon on the theory that you "buy the rumor & sell the news." But how does that explain the US dollar rising 83 basis points(0.86%) to 97? It don't, but the dollar's even-sided triangle does. The Greek drama (oooo, I'm sorry) drove the dollar temporarily back into the triangle but it broke out again today. A guess puts a target at 103.60. Yen shed whatever superpower Greece had given it and fell 0.58% to 80.99, strenuously eradicating any idea of a rally ever again. Here's a dollar chart, http://schrts.co/i2tMzG

At day's end investors were selling bonds, which boosted yields. Yield on the 10 year treasury note rose 0.54% to 2.430% although he 30 year bond eased off 0.06%.

Silver ended Comex down 3.2 cents (0.21%) at 1543.6c while gold fell $2.50 (0.22%) to $1,155.20. Gold/Silver Ratio was almost flat at 74.838.

At the same time today -- about 4 a.m. Eastern -- silver & gold tanked & the US dollar index soared. The heavy lifting was all done by the time Comex opened, but gold dipped around 11:00 to its low around $1,149.80. Must have been buyers hiding behind $1,150, because it rose from there to $1,158 and flatline the rest of the day. Silver ranged from 1527c to 1590c.

I can't hep it, I see what I see & it looks good. Silver has left a V-bottom behind that promises at least some rally, maybe to the 200 DMA above at 1650c. Whether that will hold or it will do something more creditable than that, who knows. Gold just trod water in the selfsame range it's held the last five days. No message there except "beneath $1,150 lurk buyers."

Commitments of traders reports have become much more bullish for both silver & gold. That leads me to suspect that after today's Greek news shake-out silver & gold may still rise this week. To what I already said about demand I add this anecdotal evidence: big customers we haven't heard from since the early days of the bull market are calling again & placing serious orders. Does that mean anything?

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SPECIAL OFFER: BELGIAN TWENTY FRANCS

Take advantage of gold's price drop today! Spot gold basis for these offers is $1,155.20

Empires used to run on gold, that's why so many French-style 20 franc coins are still extant & traded in the world. The Latin Monetary Union encouraged other countries to mint gold coins of the same size, so the Belgians followed suit. Twenty francs (20 lira, 20 drachmai, 20 lei, etc.) belong to the most popular gold coins in the world & contain 0.1867 troy ounce of fine gold. I'll sell these Belgians at $226.00 each (a 4.8% premium over gold) till stock is gone. These coins are circulated but full weight.

For comparison's sake I checked a well-known price cutter website a few minutes ago & they were selling these for $235.64 any quantity.

One lot contains ten Belgian 20 franc coins at $226.00 each or a total of $2,260.00 plus $35 shipping for a total of $2,295.00. I have only 7-1/2 lots.

Special Conditions:

First come, first served, and no re-orders at these prices. I will write orders based on the time I receive your e-mail.

Sorry, we will not take orders for less than the minimum shown above.

All sales on a strict "no-nag" basis. We will ship as soon as your check clears, but we allow Two weeks (14 days) for your check to clear. Calls looking for your order two days after we receive your check will be politely and patiently rebuffed. ORDERING INSTRUCTIONS:

1. You may order by e-mail only to offers@the-moneychanger.com. No phone orders, please. Please do NOT order by replying to THIS email, because it will delay your email.

Your email must include your complete name, address, & phone number. We cannot ship to you without your address. Sorry, we cannot ship outside the United States or to Tennessee.

2. When you buy from us, we cannot later change or cancel the trade. We are giving you our word that we will sell at that price, & you are giving us your word that you will buy at that price, regardless what later happens in the market, up or down.

If you break your word to us, we will never again do business with you.

3. "First come, first-served" means that we will enter the orders in the order that we receive them by e-mail, till supply is exhausted.

4. If your order is filled, we will e-mail you a confirmation. If you do not receive a confirmation, your order was not filled.

5. You must send payment by personal check or bank wire (either one is fine) within 48 hours. It just needs to be in the mail, not in our hands, in 48 hours. Sorry, no credit cards.

7. "No Nag Basis" means that we allow fourteen (14) days for personal checks to clear before we ship.

Want your order faster? Send a bank wire, but that's not required. Once we ship, the post office takes four to fourteen days to get the registered mail package to you. All in all, you'll see your order in about one month if you send a check.

Argentum et aurum comparanda sunt —
Silver and gold must be bought.

— Franklin Sanders, The Moneychanger

Your source for gold and silver. Read our latest reviews and testimonials.
Market Snapshot See more charts and market data
13-Jul-15 Price Change % Change
Gold, $/oz 1,155.20 -2.50 -0.22%
Silver, $/oz 15.44 -0.03 -0.21%
Gold/Silver Ratio 74.838 -0.007 -0.01%
Silver/Gold Ratio 0.0134 0.0000 0.01%
Platinum 1,036.00 3.70 0.36%
Palladium 657.95 8.60 1.32%
S&P 500 2,099.60 22.98 1.11%
Dow 17,977.68 217.27 1.22%
Dow in GOLD $s 321.70 4.57 1.44%
Dow in GOLD oz 15.56 0.22 1.44%
Dow in SILVER oz 1,164.66 16.46 1.43%
US Dollar Index 97.00 0.83 0.86%
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: 1,156.60      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,192.45 1,197.08 1,197.08
1/2 AE 0.50 589.36 610.11 1,220.21
1/4 AE 0.25 297.57 310.84 1,243.35
1/10 AE 0.10 121.34 126.65 1,266.48
Aust. 100 corona 0.98 1,128.03 1,137.03 1,160.00
British sovereign 0.24 274.31 287.31 1,220.50
French 20 franc 0.19 217.56 221.56 1,186.70
Krugerrand 1.00 1,176.26 1,186.26 1,186.26
Maple Leaf 1.00 1,164.60 1,180.60 1,180.60
1/2 Maple Leaf 0.50 665.05 607.22 1,214.43
1/4 Maple Leaf 0.25 294.93 309.39 1,237.56
1/10 Maple Leaf 0.10 122.60 126.07 1,260.69
Mexican 50 peso 1.21 1,387.42 1,398.42 1,159.84
.9999 bar 1.00 1,160.65 1,168.60 1,168.60
SPOT SILVER: 15.46      
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 12,909.33 13,266.83 18.56
US 40% silver 1/2s 0.30 4,367.48 4,517.48 15.31
100 oz .999 bar 100.00 1,535.50 1,585.50 15.86
10 oz .999 bar 10.00 153.55 159.05 15.91
1 oz .999 round 1.00 15.56 16.06 16.06
Am Eagle, 200 oz Min 1.00 16.96 17.81 17.81
SPOT PLATINUM: 1,036.00      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 1,051.00 1,081.00 1,081.00
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© 2015 Little Mountain Corporation, d.b.a. The Moneychanger. All rights reserved. May not be republished in any form, including electronically, without our express permission.

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.

Other Important Information

This is not an offer to buy or sell. Prices subject to change without notice. To enter an order, call us at (888) 218-9226 or (931) 766-6066. Sorry, no sales to Tennessee.

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