The Moneychanger
Daily Commentary
Monday, 27 June a.d. 2016 Browse the commentary archive

Turmoil continued to boil & roil stock markets today. Dow in Gold has simply collapsed.

Both the Dow 7 the SP500 closed below the necklines of those head and shoulders formations, AND below their 200 day moving averages, a poisonous cocktail. Dow lost 260.51 (1.5%) to close at 17,140.24 while the S&P plunged 36.87 (1.81%) to 2,000.54. Whoa.

Dow in gold has broken down from its megaphone pattern and closed today at 12.91 oz, less than half an ounce above the February low at 12.56 oz.

Stocks have only begun to fall -- around the globe. 2008 Part 2 may have begun.

US dollar index rose another 113 basis points (a huge 1.185) to 96.70. Euro sank, of course, 0.7% to $1.1026, more evidence that central banks manipulate the snot out of currency markets. Yen rose 0.24 to 98.06.

When they weren't heavy lifting the dead weight of the euro today, the Nice Government men must have been bashing gold. It did reach a high at $1,340, and closed $2.5 higher at $1,322.50, but needs to step on out!

Silver lost 4.5 cents today to 1774.4. People keep asking me why silver hasn't risen as much as gold. Plainly, because this rally is being driven by financial panic. In part that panic is a REVULSION against fiat currencies and in favor of gold. Silver will ride along, be patient.

This leg up has NOT ended. Gold does need to stay above $1,300, and silver needs to wipe out that little non-confirmation by busting out over 1800ยข.

Sorry, no commentary tomorrow. I'll be finish up my monthly Moneychanger newsletter for paid subscribers.

On 27 June 1893 the New York Stock Market crashed. By year end, 600 banks and 74 railroads had turned hooves up to the sky. Now I wonder why so many BANKS, of all things, and RAILROADS would go bust? Couldn't have anything to do with fractional reserve banking, the same old overindebtedness credit bubble we are watching today, could it? And railroads? Could have anything to do with government involving themselves with railroads and even financing them. Nawww.

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
27-Jun-16 Price Change % Change
Gold, $/oz 1,322.50 2.50 0.19%
Silver, $/oz 17.74 -0.05 -0.25%
Gold/Silver Ratio 74.532 0.329 0.44%
Silver/Gold Ratio 0.0134 -0.0001 -0.44%
Platinum 979.20 -7.50 -0.76%
Palladium 559.75 10.95 2.00%
S&P 500 2,000.54 -36.87 -1.81%
Dow 17,140.24 -260.51 -1.50%
Dow in GOLD $s 267.92 -4.59 -1.68%
Dow in GOLD oz 12.96 -0.22 -1.68%
Dow in SILVER oz 965.97 -12.20 -1.25%
US Dollar Index 96.70 1.13 1.18%
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: 1,325.40      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,358.54 1,369.80 1,369.80
1/2 AE 0.50 675.44 699.15 1,398.30
1/4 AE 0.25 341.03 356.20 1,424.81
1/10 AE 0.10 139.06 145.13 1,451.31
Aust. 100 corona 0.98 1,292.66 1,301.66 1,327.95
British sovereign 0.24 314.34 327.34 1,390.57
French 20 franc 0.19 249.31 253.31 1,356.77
Krugerrand 1.00 1,332.03 1,342.03 1,342.03
Maple Leaf 1.00 1,335.40 1,349.40 1,349.40
1/2 Maple Leaf 0.50 762.11 695.84 1,391.67
1/4 Maple Leaf 0.25 337.98 354.54 1,418.18
1/10 Maple Leaf 0.10 140.49 144.47 1,444.69
Mexican 50 peso 1.21 1,589.91 1,600.91 1,327.79
.9999 bar 1.00 1,330.04 1,337.40 1,337.40
SPOT SILVER: 17.76      
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 12,877.15 13,162.15 18.41
US 40% silver 1/2s 0.30 5,121.20 5,283.20 17.91
100 oz .999 bar 100.00 1,801.00 1,826.00 18.26
10 oz .999 bar 10.00 179.10 184.10 18.41
1 oz .999 round 1.00 17.86 18.32 18.32
Am Eagle, 200 oz Min 1.00 19.26 20.51 20.51
SPOT PLATINUM: 979.20      
Plat. Platypus 1.00 994.20 1,024.20 1,024.20
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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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