The Moneychanger
Daily Commentary
Tuesday, 14 June a.d. 2016 Browse the commentary archive

My friend WR pointed my attention today to the Volatility Index (VIX). Ponder the chart here,

Volatility index measures investor confidence in stockd on a scale from smug (low) to demoralized terror (high). Like flocks of birds or schools of fish turning on a dime, the investor herd occasionally panics & runs for the cliffs. Note the red arrow on the chart, pointing to where the VIX gapped up last August, right before the VIX launched to the moon & the stock market tanked. It rose so sharply & fast that it punctured the top boundary of the 32 high/11.50 low range that had ruled since 2012.

Then the pendulum swung back to complacency last November and December, but began creeping up as stocks fell off the cliff in January & February. VIX settled back into a low range of smugness. Whoops. Two days ago it shot higher, blowing past the 200 day moving average and not slowing down.

The VIX's trajectory is warning that a stock plunge looms right ahead. Argue with a chart at your own peril.

Here's the same chart with the S&P500 superimposed. Notice how the S&P500 falls into a manhole when the VIX shoots up.

But y'all don't pay me no mind. I'm jes' a nat'ral born durn fool from Tennessee. How could I possibly notice anything them New York smarties missed?

Stocks continued to submerge today, but aided by NGM friends right at 3:00 p.m. recovered a bit toward day's end. Dow lost 57.66 (0.33%) to 17,674.82. S&P500 backed down 0.18% (3.75) to 2,075.32.

US dollar index finally found some spine and rose 65 basis points (0.69%) to 95.07. Wonder how that dollar will hold up when Brexit is passed & the S&P500 is tunneling toward the earth's core like some gigantic mutant mole?

Technically that does put the dollar index up above its 50 & 20 day moving averages, that is, momentum is up. Yet the dollar is approaching the 95.50 area where it fainted & fell last time.

Euro took the hit today, losing 0.75% to $1.1208. If the UK leaves the EU, the union will fly apart, sending whole countries flinging through the sky.

Comex gold gained only $1.20 to $1,285.60 while silver backed off 1.8¢ to 1741.

Gold traded from $1,278.60 to $1,293 today. It rose to a peak about 10:30, then sellers drove it back to $1,280 by 1:30. At least, that's what a daily chart shows, but it didn't feel that way. Every time gold dropped today, it bounded right back. Still, its rise slowed today, and it has reached the area of maximum resistance so it is slogging, maybe stopped. Frankly, if gold can work through this & clear $1,308, it would be scary. Markets would be saying something REALLY terrible lies just ahead.

Silver has reached the sticky resistance, too. Up above the big hurdle is 1806¢.

FOR GOLD BUYERS: Apparently our US $5 gold commems offer yesterday hit the spot, because we were covered up today. If I missed returning any phone calls, forgive me.

I am offering the special one more day, through Wednesday.


In 1986 the US mint began issuing commemorative $5 gold pieces in the ancient weight of .2418 oz and 90% fineness, about a quarter ounce. Between 1986 and 2008 the Mint issued 21 different commemoratives.

Now here's a secret about "modern rarities" that dealers won't tell you. Mints issue them at high premiums, but the premiums very rapidly evaporate, so you never want to buy them when first issued (when public interest is hot), but only after they lose all that premium.

So it has happened with the US $5 commemoratives. They have virtually no premium left, and never mind that they are handsome coins, struck in proof and encased in plastic.

What does this mean for us? This is my absolute favorite quarter ounce sized gold coin, because it is beautiful, plainly struck in the U.S., & most of all, CHEAP.

Here's the offer. A wholesaler friend has a bucket load of US $5 commems & he got the price right. I can sell them to you at $11 per coin over their spot gold value. In other words, if the spot gold value is $310.70 ($1,285 spot gold x 0.2418), I could sell them to you at $321.70. That works out to a 3.5% premium over spot gold, ridiculously low.

This offer will operate a little differently than others: DO NOT EMAIL US to accept the offer. Please TELEPHONE US at (931) 766-6066 to enter an order, based on whatever gold price is then-current, higher or lower. It WON'T be exactly $321.70, but will be $11 over whatever the coin's melt value is at the time.

** Minimum order is Ten (10) coins. With spot gold around $1,285, that amounts to about $3,220, plus $30 for shipping makes approximately $3,250.

** Only one $30 shipping charge per order, whether you order 10 or 1,000.

** Offer is good for Two days only, Tuesday, 14 June & Wednesday, 15 June.

** We start answering at 9:00 Eastern. If you get voice mail, it means our lines are clogged. Leave your name, address, phone number, & email & how many US$5 commems you want. We'll call you back quickly with the order written.

The following other conditions apply

Special Conditions:

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 telephone only at (931) 766-6066. Phone orders only, please. Sorry, we can't ship into Tennessee or outside the United States.

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. Once your order is filled, we will e-mail you a confirmation.

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

5. "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, if you send a check you'll see your order in about one month; a wire, about a week.

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
14-Jun-16 Price Change % Change
Gold, $/oz 1,285.60 1.20 0.09%
Silver, $/oz 17.41 -0.02 -0.10%
Gold/Silver Ratio 73.843 0.145 0.20%
Silver/Gold Ratio 0.0135 -0.0000 -0.20%
Platinum 971.50 -23.40 -2.35%
Palladium 536.55 -10.10 -1.85%
S&P 500 2,075.32 -3.74 -0.18%
Dow 17,674.82 -57.66 -0.33%
Dow in GOLD $s 284.20 -1.19 -0.42%
Dow in GOLD oz 13.75 -0.06 -0.42%
Dow in SILVER oz 1,015.21 -2.26 -0.22%
US Dollar Index 95.07 -0.21 -0.22%
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: 1,286.00      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,318.15 1,329.08 1,329.08
1/2 AE 0.50 655.35 678.37 1,356.73
1/4 AE 0.25 330.89 345.61 1,382.45
1/10 AE 0.10 134.93 140.82 1,408.17
Aust. 100 corona 0.98 1,254.23 1,263.23 1,288.75
British sovereign 0.24 304.99 317.99 1,350.87
French 20 franc 0.19 241.90 245.90 1,317.07
Krugerrand 1.00 1,295.00 1,305.00 1,305.00
Maple Leaf 1.00 1,296.00 1,310.00 1,310.00
1/2 Maple Leaf 0.50 739.45 675.15 1,350.30
1/4 Maple Leaf 0.25 327.93 344.01 1,376.02
1/10 Maple Leaf 0.10 136.32 140.17 1,401.74
Mexican 50 peso 1.21 1,541.10 1,552.10 1,287.30
.9999 bar 1.00 1,290.50 1,298.00 1,298.00
SPOT SILVER: 17.38      
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 12,676.95 12,961.95 18.13
US 40% silver 1/2s 0.30 5,009.10 5,171.10 17.53
100 oz .999 bar 100.00 1,763.00 1,788.00 17.88
10 oz .999 bar 10.00 175.30 180.30 18.03
1 oz .999 round 1.00 17.48 17.94 17.94
Am Eagle, 200 oz Min 1.00 18.88 20.13 20.13
SPOT PLATINUM: 971.50      
Plat. Platypus 1.00 986.50 1,016.50 1,016.50
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Copyright Notice

© 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.

For complete details on how to buy from us or sell to us, please click here.