The Moneychanger
Daily Commentary
Tuesday, 22 December a.d. 2015 Browse the commentary archive

You can't expect much to happen the week before Christmas, when traders are closing out positions to enjoy a holiday not worried about markets.

Santa Claus has not arrived yet on Wall Street, but stock investors got a little gift today. Dow rose 165.65 (0.96%) to 17,417.27 while the S&P500 added 17.82 (0.88%) to 2,038.97.

Since both continue below their 200 day moving averages, trying to breath underwater, as it were, this ain't too impressive. It did affect the Dow in Gold & Dow in silver, since metals today fell or were flat, so higher stocks brought up the Dow in Gold & Dow in Silver, but not much. Dow in silver rose 0.47% to 1,216.80 troy ounces, bouncing off the uptrend line from August 2013 & the nearby 50 DMA (1,197.82). Dow in Gold bounced off an old resistance/support line, also near the 50 DMA (15.97 tr. Oz). Both indicators have made a series of lower highs and lower lows, i.e., a downtrend.

Scrofulous US dollar index continues to pile up evidence it is broken. Today it sank another 23 basis points (0.23%), touched the 50 DMA (97.98), & ended at 98.23. Just goes to show the Fed & FOMC can goose markets, but they can't make 'em stay goosed. Euro rose 0.35% to $1.0953, doing nothing but at least again in the range it fell out of in November. Ditto the Yen, up 0.11% today to 82.61.

Interesting -- silver is backwardated. The spot month contract, December, closed today at 1430.2. January 16 closed 1428.6¢, and February 16 at 1430¢. That's not a huge backawardation, but still means something. Physical silver for immediate delivery is selling at a premium to futures silver. Normally the more distant months carry a higher price, due to the costs of carrying the silver until the contract comes due (interest, storage, insurance). When the spot month rises above the futures months, the market wants silver in hand bad enough to pay more for it than futures. Not significant yet, but could become so.

Gold today fell back from $1,080 like Vlad Dracula reeling back from a crucifix, down $7.10 to 1,074.80. Tacky & tasteless, but still above the 20 DMA (1,067.69). Silver rose -- hold onto your seat -- one-tenth of one cent to 1430.2¢.

Today changes nothing that I said yesterday about gold & silver's bullish outlook, it only points out the ambiguity and torment of reversing. That gold/silver ratio keeps on dropping, and stands below its 20 DMA but barely above its 50. Closing 75.04 at the end of day, it stands not far above the 200 DMA at 74.20. Y'all can see the chart here, http://schrts.co/kh9gOy

US government yesterday decreed that the ban on homosexuals giving blood to prevent contaminating the blood supply with HIV is being lifted -- for those homosexuals who aver they have been celibate for the last year. Y'all might want to check out autologous blood transfusion, to see if there is a blood bank or service in your area that can draw and store your own blood in case you or family members need blood transfusions. In any event this is always the best way to receive a blood transfusion.

On 22 December 1989 the dictatorship of Nicolae Ceausescu was overthrown in Romania, ending 42 years of Communist rule. It all began with a Romanian-Hungarian Reformed pastor, Laslo Tokes (pron. Toe-kesh). The government was trying to evict him from his church apartment. His parishioners began a vigil outside on 15 December, refusing to move when guards ordered them. Even though Tokes advised the people to leave, several hundred hung around. Events escalated, the crowd grew. When the mayor of Timisoara warned the crowd to disperse or face water cannons, the crowd stayed, and no water cannons appeared. The crowd began to sing the patriotic song, "Wake up, O Romanian!" banned since 1947 by the Communists. Next they began to shout, "Down with Ceausescu! Down with Communism!" The crowd headed toward the city center where the militia failed to disperse them. Water cannons were brought out, but the crowd seized them & threw them into the river.

On Sunday, 17 December, the army fired into the crowd, killing many. On 18 December thousands of workers in Timisoara joined the protest, and by 20 December the city was in full revolt. News spread across Romania and triggered more protests that swirled into the Romanian Revolution that overthrew Ceausescu and the Communists. On 25 December Ceausescu and his wife Elena were captured by the armed forces, tried and convicted of genocide and sabotage of the Romanian economy in a one-hour session -- longer than they had given many of their victims -- and then shot by a firing squad.

It all began with one pastor who said, "No."

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
22-Dec-15 Price Change % Change
Gold, $/oz 1,074.80 -7.10 -0.66%
Silver, $/oz 14.30 0.00 0.01%
Gold/Silver Ratio 75.150 -0.502 -0.66%
Silver/Gold Ratio 0.0133 0.0001 0.67%
Platinum 872.80 -8.30 -0.94%
Palladium 554.90 2.15 0.39%
S&P 500 2,038.97 17.82 0.88%
Dow 17,417.25 165.65 0.96%
Dow in GOLD $s 334.99 5.36 1.63%
Dow in GOLD oz 16.21 0.26 1.63%
Dow in SILVER oz 1,217.82 11.50 0.95%
US Dollar Index 98.23 -0.23 -0.23%
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: 1,072.60      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,103.71 1,116.58 1,116.58
1/2 AE 0.50 546.52 565.80 1,131.59
1/4 AE 0.25 275.94 288.26 1,153.05
1/10 AE 0.10 112.52 117.45 1,174.50
Aust. 100 corona 0.98 1,042.95 1,051.95 1,073.20
British sovereign 0.24 254.38 267.38 1,135.87
French 20 franc 0.19 201.76 205.76 1,102.07
Krugerrand 1.00 1,084.40 1,094.40 1,094.40
Maple Leaf 1.00 1,082.60 1,096.60 1,096.60
1/2 Maple Leaf 0.50 616.75 563.12 1,126.23
1/4 Maple Leaf 0.25 273.51 286.92 1,147.68
1/10 Maple Leaf 0.10 113.70 116.91 1,169.13
Mexican 50 peso 1.21 1,284.07 1,295.07 1,074.13
.9999 bar 1.00 1,076.35 1,084.60 1,084.60
SPOT SILVER: 14.24      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 22.50 26.00 33.99
VG+ Peace dollar 0.77 17.50 20.00 26.14
90% silver coin bags 0.72 11,429.28 11,786.78 16.49
US 40% silver 1/2s 0.30 4,007.58 4,157.58 14.09
100 oz .999 bar 100.00 1,448.50 1,473.50 14.74
10 oz .999 bar 10.00 143.85 148.85 14.89
1 oz .999 round 1.00 14.34 14.80 14.80
Am Eagle, 200 oz Min 1.00 15.74 16.99 16.99
SPOT PLATINUM: 872.80      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 887.80 917.80 917.80
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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

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