The Moneychanger
Daily Commentary
Thursday, 15 October a.d. 2015 Browse the commentary archive

Right on cue today the stock market "miraculously" jumped. Dow added 217 (1.28%) and almost re-couped what it had spent the last two days losing. S&P500 recaptured 29.26, a 1.49% gain. Dow ended at 17,141.75 while the S&P500 closed at 2023.86.

Low was made yesterday and buying came in early in the day, but accomplished nothing until about noon, when stocks began to advance strongly and kept it up the rest of the day.

Today's rise doesn't shake my conclusions. Stocks have rallied back up to their breakdown point, a technical move that happens not frequently but nearly all the time. Stocks should resume their fall from the tenth story, soon.

Today had more Fed presidents out swabbing, loading, & firing the blarney cannon. New York Fedprez Dudley was castigated on a panel for FedHeads making conflicting remarks about raising rates. He had the almighty gall to say "We are all pretty much on the same page." Folks, I'm telling y'all, they are laboring mightily to sell this idea they are still going to raise rates, & in December. When pigs fly. When central bankers grow hearts. When government officials lips move & truth comes out. When the global warming warms.

Following stocks still, the US dollar index rose, too, 47 basis points or 0.5% to 94.43. That might be the first half of a key reversal, but it didn't break into new low territory by much, so maybe not. To prove that reversal dollar must close higher tomorrow.

In the face of the dollar rattling its empty saber the cowardly euro retreated 0.83% to $1.1380. Not deadly -- it's still rallying but needs to climb over $1.1500.

Yen was tougher, gave up on 0.06% & closed at 84.10.

Silver escalated 5 cents to 1615.2, holding on above 1600c for the second straight day. Gold elbowed ahead $7.80 to $1.187.90, pushing through that resistance like it was dressed in leather Carharts and pushing through briers.

For the second day gold closed above its 200 day moving average ($1,176.21) and above the downtrend from the October 2012 high. This steady push from $1,165 through resistance looks strong. If they can't beat gold back here, it will jump through $1,205 & take off running.

Silver, too, has reached new highs, pierced the 200 DMA (1597c), and keeps holding on to its gains and slugging higher. Aiming at 1786c.

What keeps on vexing me is the enormous disparity between the paper gold & silver markets and the physical. Probably 50 times as much paper silver is traded as actual. What happens when the price jumps and somebody can't deliver? Price soars, & a lot of people who thought they were safe find out they aren't. This explains why I keep begging y'all to bring your silver & gold home where you can keep an eye on it. Watch out, watch out.

On 15 October 1951 premiered the "I Love Lucy" show on CBS, starring Lucille Ball and Desi Arnaz.

On 15 October 1844 was born in Saxony the German philosopher Friedrich Wilhelm Nietzsche. He wrote of nihilism, the death of God, the Uebermensch (superman). and the will to power. At age 44 in 1889 he suffered a collapse and complete loss of his mental faculties. This was ascribed to terriary syphilis. He lived until 1900, first under his mother's care, then his sister's.

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
15-Oct-15 Price Change % Change
Gold, $/oz 1,187.90 7.80 0.66%
Silver, $/oz 16.15 0.05 0.31%
Gold/Silver Ratio 73.545 0.256 0.35%
Silver/Gold Ratio 0.0136 -0.0000 -0.35%
Platinum 1,005.60 19.20 1.95%
Palladium 704.25 4.65 0.66%
S&P 500 2,023.86 29.62 1.49%
Dow 17,141.75 217.00 1.28%
Dow in GOLD $s 298.30 1.83 0.62%
Dow in GOLD oz 14.43 0.09 0.62%
Dow in SILVER oz 1,061.28 10.18 0.97%
US Dollar Index 94.43 0.47 0.50%
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: 1,185.30      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,214.93 1,226.79 1,226.79
1/2 AE 0.50 603.99 625.25 1,250.49
1/4 AE 0.25 304.96 318.55 1,274.20
1/10 AE 0.10 124.35 129.79 1,297.90
Aust. 100 corona 0.98 1,156.02 1,165.02 1,188.56
British sovereign 0.24 281.11 287.11 1,219.68
French 20 franc 0.19 222.96 226.96 1,215.61
Krugerrand 1.00 1,200.71 1,210.71 1,210.71
Maple Leaf 1.00 1,195.30 1,209.30 1,209.30
1/2 Maple Leaf 0.50 681.55 622.28 1,244.57
1/4 Maple Leaf 0.25 302.25 317.07 1,268.27
1/10 Maple Leaf 0.10 125.64 129.20 1,291.98
Mexican 50 peso 1.21 1,420.42 1,431.42 1,187.21
.9999 bar 1.00 1,189.45 1,197.30 1,197.30
SPOT SILVER: 16.14      
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 13,184.60 13,685.10 19.14
US 40% silver 1/2s 0.30 4,569.55 4,819.55 16.34
100 oz .999 bar 100.00 1,639.00 1,664.00 16.64
10 oz .999 bar 10.00 162.90 167.90 16.79
1 oz .999 round 1.00 16.24 16.70 16.70
Am Eagle, 200 oz Min 1.00 17.64 19.14 19.14
SPOT PLATINUM: 1,005.60      
Plat. Platypus 1.00 1,020.60 1,050.60 1,050.60
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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.

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