The Moneychanger
Daily Commentary
Monday, 5 October a.d. 2015 Browse the commentary archive

I strongly recommend y'all read Vladimir Putin's 28 September speech in front of the UN General Assembly. I would normally have no time whatever for a UN speech, but y'all need to read this one. Also read Patrick Buchanan's comments in "How the War Party Betrayed America's Non-Interventionist Foreign Policy Tradition" at

The more you think you agree with American foreign policy of the last 40 years, the more you need to read these articles.


Trying to parse out why the US stock market should rise on the worst imaginable employment report, I have read several articles & I agree with a theory that sounds too crazy even for today's world: investors are reasoning that with the economy sooooo bad, the Fed (1) can't raise interest rates & thus tank stocks, and (2) must sooner or later crank up Quantitative Easing 4. In other words, Wall Street LOVES a rotten economy because it means the Fed will keep subsidizing them.

This thought has run my Stupid-O-Meter over into the red & broken it. Worse yet, I believe it's likely accurate. I also believe it won't last.

Stocks gapped a tiny gap up today and the Dow but not the S&P500 nicked into the 50 Day moving average (moving averages are in bearish alignment with the 20 below the 30 which is below the 200). That 50 DMA will likely contain any further rise, but what if it doesn't? It climbs 150 more points to the last high? What has changed in the economy? Sure the Fed can create more money, & more & more until they hyperinflate, I reckon, but I remember the 1919-1923 German hyperinflation where the stock market made enormous gains -- but all an illusion. In purchasing power terms it lost.

Stocks may spend a few more days consolidating, but the trend is DOWN, & the trend is your friend. Never bet against your friend.

Dow rose 304.06 (1.85) to 16,776.43, while the S&P500 rose 1.83% (35.69) to 1,987.05. Clearly the market is offering stock investors one last chance to sell out. Take it.

As it has been doing the last couple of days, the US dollar index rose with stocks, today up 27 basis points (0.28%) to 96.24. This solves nothing, answers nothing. The 30 DMA is above the 20 DMA and that's above the 200 DMA, and they are rapidly intertwining, very close to each other, not a situation likely to last for the duration. Dollar index closed plumb on the 50 DMA, which for the last 5 weeks hath contained it. Dollar index turns leaden and gravity-bound with a close below 95.50.

Japanese yen threatened to break upside out of a triangle but was quickly slapped back today, down 0.45% to 83.03. Euro made a lackluster pitty-pat move at breaking out Friday, but didn't amount to a hill of beans. Fell today 0.18% to $1.1190. Pitiful. And you call yourself a world-class currency?

Great day for silver. It leapt up another 44.5 cents (2.9%) to 1570.2. This is leaping tall resistance with a single bound. Gold rose only a token dollar to $1,138.10.

Gold first. Gold neared that downtrend line from the January high, and blinked. Here's the end of day chart, but remember that shows a lower close today than Comex. This looks like somebody who has bounced off a door backing up to take another run at breaking it down.

Silver pole-vaulted from 1525c Friday over resistance at 1525 & 1550c up to the next bar at 1572c. This is beautiful, and looks like third wave enthusiasm. 200 day moving average stands only 26c above at 1596c. Should silver cross above that 200 DMA, every trader & his cat will begin paying attention. I am a little bit concerned because that Gold/Silver ratio has really stretched out to the downside. Friday it gapped down jumping over its closely spaced 20 & 50 DMAs and cutting into the 200 DMA, although it did not close below the 200. Today it collapsed on the End of Day chart, ending at 72.6 with the 200 at 73.83. Look at the chart. That dotted blue line marks the uptrend from the July 2014 low, and that's where the ratio stopped today. It's already below the uptrend from the April 2011 low. If it breaks down any further, any lower close tomorrow, then big things are fixing to happen in silver & gold. On the other hand, it might mark the limit of a move. Here, go look for yourself,

Durned if I know which, but that ain't no surprise! After all, I ain't no more'n a nat'ral born durned fool from Tennessee anyhow. If Wall Street & the whole durned worl' collapses, I ain't worried. I'll just buy me a tin bill and peck in the dirt with the chickens.

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
5-Oct-15 Price Change % Change
Gold, $/oz 1,138.10 1.00 0.09%
Silver, $/oz 15.70 0.45 2.92%
Gold/Silver Ratio 72.481 -2.049 -2.75%
Silver/Gold Ratio 0.0138 0.0004 2.83%
Platinum 911.10 3.80 0.42%
Palladium 687.85 -9.75 -1.40%
S&P 500 1,987.05 35.69 1.83%
Dow 16,776.43 304.06 1.85%
Dow in GOLD $s 304.72 5.26 1.76%
Dow in GOLD oz 14.74 0.25 1.76%
Dow in SILVER oz 1,068.43 -11.23 -1.04%
US Dollar Index 96.24 0.27 0.28%
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: 1,136.40      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,168.22 1,176.17 1,176.17
1/2 AE 0.50 579.05 599.45 1,198.90
1/4 AE 0.25 292.37 305.41 1,221.63
1/10 AE 0.10 119.22 124.44 1,244.36
Aust. 100 corona 0.98 1,108.33 1,117.33 1,139.90
British sovereign 0.24 269.51 282.51 1,200.15
French 20 franc 0.19 213.76 217.76 1,166.35
Krugerrand 1.00 1,156.86 1,166.86 1,166.86
Maple Leaf 1.00 1,146.40 1,160.40 1,160.40
1/2 Maple Leaf 0.50 653.43 596.61 1,193.22
1/4 Maple Leaf 0.25 289.78 303.99 1,215.95
1/10 Maple Leaf 0.10 120.46 123.87 1,238.68
Mexican 50 peso 1.21 1,360.45 1,371.45 1,137.47
.9999 bar 1.00 1,140.38 1,148.40 1,148.40
SPOT SILVER: 15.67      
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 13,635.05 13,992.55 19.57
US 40% silver 1/2s 0.30 4,430.90 4,680.90 15.87
100 oz .999 bar 100.00 1,592.00 1,617.00 16.17
10 oz .999 bar 10.00 158.20 163.20 16.32
1 oz .999 round 1.00 15.77 16.23 16.23
Am Eagle, 200 oz Min 1.00 17.17 18.67 18.67
SPOT PLATINUM: 911.10      
Plat. Platypus 1.00 926.10 956.10 956.10
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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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