The Moneychanger
Daily Commentary
Tuesday, 12 July a.d. 2016 Browse the commentary archive

On Thursday night, 14 July 2016 at 6:30 p.m. I'll be speaking at the Huntsville Tea Party meeting at Whitesburg Baptist Church, 3911 Pulaski Pike NW, Huntsville 35810. I'll be talking about the bank credit(debt) boom bust cycle, springing off Tilden Freeman's 1935 book, A World in Debt. I'll be working hard to stifle my natural gift for sarcasm & scorn when speaking on banks & debt & fiat money. I doubt I will succeed in stifling it, but I promised my wife Susan I'd be nice.

I'll be one of the few not wearing shoes. My friend & attorney Larry Becraft will probably be unshod as well. At least, he often is in the courtroom.

Lawsie, the jubilatin' became general & there's a run on New York gin stores in the rush to celebrate. Dow closed at a new all time high today, 18,347.67 (vs. 2015's 18,312.39), up 120.74 or 0.66%. S&P500 made another new all-time high today, second in two days, at 2,152.04, up 14.98 (0.7%).

Listening to the Wall Street shills, you'd think the millennium had arrived & the paving trucks were even now backing up to pave Wall Street with gold. That might be a mite previous, as we say. Looks to me like a textbook double top. This one is fed by the re-election of Abe in Japan, and is feeding on the assumption that the Bank of Japan and other criminal central banks will open wide the floodgates of new money stimulus again. Nothing has changed, & this game can just roll on forever, world without end.

I knew a man once who thought he could repeal the law of gravity at will. Jumped off a 15 story building to prove his point. On the way down, somebody on the 12th floor heard him yell, "So far, so good!"

What he said at ground zero is not recorded.

It's risk-on trades all over the globe as the speculators dive in again. Scared to miss the train, they shucked bonds today so hard that the 10 year treasury yield gapped up. US dollar index sank again beneath its 200 day moving average, closing at 96.49, down 0.1 (0.11%). Not inspiring, but see for yourself,

Yen gapped down today 1.81% to 95.5¢/Y100. Looks broke.

Gold plunged $20.9 (1.5%) to $1,334.10 as money was sucked away into the stock market. Silver backed off 13.4¢ (0.7%) to 2013¢.

Yes, gold dropped, but remains in the grip of a fiercely strong upwave. Could correct back to the 20 DMA ($1,317.70) but should not fall as far as the last low about $1,310. Market is handing y'all a low-priced GIFT. View the chart at

Gold/silver ratio keeps dropping as silver continues to outpace gold. Silver is stumbling over its top channel line. Might fall to 1950¢, but buyers throng in droves around 2000¢. Correction will be shallow again.

By the way, Platinum & Palladium are confirming silver & gold.

Y'all ought to pay attention: market is handing y'all free money with these lower gold & silver prices.

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
12-Jul-16 Price Change % Change
Gold, $/oz 1,334.10 -20.90 -1.54%
Silver, $/oz 20.13 -0.13 -0.66%
Gold/Silver Ratio 66.274 -0.593 -0.89%
Silver/Gold Ratio 0.0151 0.0001 0.89%
Platinum 1,094.40 -10.30 -0.93%
Palladium 629.00 3.20 0.51%
S&P 500 2,152.04 14.98 0.70%
Dow 18,347.67 120.74 0.66%
Dow in GOLD $s 284.30 6.23 2.24%
Dow in GOLD oz 13.75 0.30 2.24%
Dow in SILVER oz 911.46 11.99 1.33%
US Dollar Index 96.59 -0.10 -0.10%
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: 1,332.80      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,364.79 1,377.45 1,377.45
1/2 AE 0.50 679.22 703.05 1,406.10
1/4 AE 0.25 342.94 358.19 1,432.76
1/10 AE 0.10 138.51 145.94 1,459.42
Aust. 100 corona 0.98 1,294.65 1,303.65 1,329.99
British sovereign 0.24 316.09 329.09 1,398.02
French 20 franc 0.19 250.70 254.70 1,364.22
Krugerrand 1.00 1,342.13 1,352.13 1,352.13
Maple Leaf 1.00 1,342.80 1,356.80 1,356.80
1/2 Maple Leaf 0.50 766.36 699.72 1,399.44
1/4 Maple Leaf 0.25 339.86 356.52 1,426.10
1/10 Maple Leaf 0.10 141.28 145.28 1,452.75
Mexican 50 peso 1.21 1,598.79 1,609.79 1,335.15
.9999 bar 1.00 1,337.46 1,344.80 1,344.80
SPOT SILVER: 20.14      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 23.00 27.00 35.29
VG+ Peace dollar 0.77 18.00 20.00 26.14
90% silver coin bags 0.72 14,400.10 14,685.10 20.54
US 40% silver 1/2s 0.30 5,823.30 5,985.30 20.29
100 oz .999 bar 100.00 2,039.00 2,064.00 20.64
10 oz .999 bar 10.00 202.90 207.90 20.79
1 oz .999 round 1.00 20.24 20.70 20.70
Am Eagle, 200 oz Min 1.00 21.89 22.89 22.89
SPOT PLATINUM: 1,094.40      
Plat. Platypus 1.00 1,109.40 1,139.40 1,139.40
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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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