The Moneychanger
Daily Commentary
Tuesday, 25 August a.d. 2015 Browse the commentary archive

Biggest thing missing from Christendom today is ethics, applying the faith to life, so imagine my surprise when I read Noah Sanders' book, Born-Again Dirt. (Far as I know we are not kin, unless it's through the great Shenandoah Valley passage seven or eight generations ago.) Noah's book is practical and pious without pietism, utterly humble & winsome. Whether you are a farmer, a gardener, just have a windowbox growing flowers, this book will delight you. Destined to become a classic. Order for $15 from http://amzn.to/1KOqicK And, yes, I have met Noah and his wife and two little boys at the Beyond Off Grid Summit week before last, and he is as humble and earnest and pleasant in person as he is on paper. You can read about Noah at www.bornagaindirt.com

One axiom y'all have to learn is this: the Establishment has only two weapons against financial panic, blarney & liquidity. Liquidity means flushing the market with money (think TARP or QE4). Blarney is propaganda, or Blowing Smoke. They trot out the regional Fed Presidents (like NY Fed prezzy Wm. Dudley today) or the Treasury Secretary or even Warren Buffet & Harvard econ professors if things get really bad. These folks sing the siren song to sooth the public's soul. Blowing Smoke.

And, yes, these two weapons really do compose their entire arsenal, Mushrooms. That's how thin they are, and how huge & ridiculous their con game really is.

Object of Dudley's comments was likely the US dollar, which rose 59 basis points today to 95.13. Dollar's tanking earlier this week makes it appear that the entire dollar rise from last summer was fuelled by nothing more than speculators' expectations the Fed must raise rates. When the Chinese devalued the yuan and US stocks tanked, however, there was no way the Fed would raise rates. Hence Dudley's rationalization. He's saying to the public, "It's all right, these are not the droids you are looking for." His words also build the impression the Fed is watching & on top of things. Sort of like saying your six year old is watching you work on the car and will do the ring job for you.

Just remember: blarney & liquidity. It helps make sense out of all these moves & put them into perspective.

Stocks rallied in a predictable, showy, but meaningless rally. Dow rose 619.07 (3.9%) to 16,285.51. S&P500 rose 72.9 (3.9%) to 1,940.51. Both are buried deep beneath their 200 DMAs. Broken, can't be fixed. DO NOT LET THE BLARNEY SUCK YOU IN.

Gold lost $13.60 (1.2%) to $1,124.60 on Comex while silver plunged 56.9 cents (3.9%) to 1404.1c.

What I like about y'all is that y'all keep your heads in a crisis. While everybody else is moaning and groaning about silver & gold dropping, y'all spotted that gold/silver ratio at 8:1 and called me up to swap gold for silver.

More than that, as silver falls the premium on US 90% rises so those swaps from US 90% silver coin to 100 oz silver bars are now approaching a 20% gain in ounces.

Be advised the wait even on 100 oz silver bars is two to four weeks. However, over time premium always disappears, so if you don't capture it when you can, you lose it. Call us at (931) 766-6066 to execute a swap.

I have to attend my 50th high school class reunion the next two days in Memphis, so I won't be here tomorrow or Friday, but I'm going out on a limb here.

Gold today fell almost to its 20 DMA ($1,114.29) & an internal support line. With my saw in hand, I'm crawling out on that limb: I believe it is within two days of turning up again. Silver will follow, & the goofs who have been shorting silver & gold will be looking at their heads on a platter in a few days.

If I'm right, this is a spectacular buying opportunity for silver & gold. If I'm wrong, well, it could be worse: you could buy stocks.

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
26-Aug-15 Price Change % Change
Gold, $/oz 1,124.60 -13.60 -1.19%
Silver, $/oz 14.04 -0.57 -3.89%
Gold/Silver Ratio 80.094 2.188 2.81%
Silver/Gold Ratio 0.0125 -0.0004 -2.73%
Platinum 980.20 4.10 0.42%
Palladium 529.65 -10.45 -1.93%
S&P 500 1,940.51 72.90 3.90%
Dow 16,285.51 619.07 3.95%
Dow in GOLD $s 299.35 14.82 5.21%
Dow in GOLD oz 14.48 0.72 5.21%
Dow in SILVER oz 1,159.85 87.54 8.16%
US Dollar Index 95.13 0.59 0.62%
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: 1,124.90      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,155.83 1,164.27 1,164.27
1/2 AE 0.50 573.19 593.38 1,186.77
1/4 AE 0.25 289.40 302.32 1,209.27
1/10 AE 0.10 118.01 123.18 1,231.77
Aust. 100 corona 0.98 1,093.81 1,102.81 1,125.08
British sovereign 0.24 266.79 279.79 1,188.56
French 20 franc 0.19 211.59 215.59 1,154.76
Krugerrand 1.00 1,144.59 1,154.59 1,154.59
Maple Leaf 1.00 1,134.90 1,148.90 1,148.90
1/2 Maple Leaf 0.50 646.82 590.57 1,181.15
1/4 Maple Leaf 0.25 286.85 300.91 1,203.64
1/10 Maple Leaf 0.10 119.24 122.61 1,226.14
Mexican 50 peso 1.21 1,349.40 1,360.40 1,128.31
.9999 bar 1.00 1,128.84 1,136.90 1,136.90
SPOT SILVER: 14.07      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 25.00 27.00 35.29
VG+ Peace dollar 0.77 20.00 22.00 28.76
90% silver coin bags 0.72 13,095.23 13,595.23 19.01
US 40% silver 1/2s 0.30 3,957.43 4,107.43 13.92
100 oz .999 bar 100.00 1,431.50 1,456.50 14.57
10 oz .999 bar 10.00 142.15 147.15 14.72
1 oz .999 round 1.00 14.17 14.63 14.63
Am Eagle, 200 oz Min 1.00 15.57 17.07 17.07
SPOT PLATINUM: 980.20      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 995.20 1,025.20 1,025.20
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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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