The Moneychanger
Daily Commentary
Thursday, 4 August a.d. 2016 Browse the commentary archive

I reckon I'd better explain my Redneck WiFi. Talked to a fellow from Ohio today and he thought Redneck WiFi meant hollerin' out the winder.

Not by a long shot. Out in the country on the gravel roads where we live it was either satellite internet or nothing. I got burned by WildBlue & HughesNet, which were expensive, slow, and full of excuses, so when Redneck WiFi came along, I jumped at it.

I call it that because it has been put together by a couple of local fellows who know their stuff and are not intimidated by any obstacle. They are true entrepreneurs, knowledgeable, responsible, and hardworking. They climb up on that boom truck bucket, which I would not do for love, money, nor large bribes paid into a foreign bank account. When lightning strikes the towers, they fix 'em. When it doesn't work, we call 'em, talk to a real live human being, & they fix it. I don't dare tell these fellows how good they are, cause they'd raise their rates, but I tell y'all, they're fine men.

And if that don't beat working with some rotten corporation with no soul to damn and no body to kick, I'll eat your chapeau.

Until today I have been fretting at the lack of retail buying and size of retail selling. They selling confirms we saw a bottom in December, but the want of buying might threaten the rally. Then I saw this article today, "Investing in gold: Big players put money into the precious metals" at http://cnb.cx/2aLP98Y

Naturally I ain't taking CNBC's word for anything, so I called up the biggest gold & silver wholesaler I know who turns over more than $5 billion yearly. I asked him if he had seen those large sales. He confirmed they are seeing lots of retail sellers and few retail buyers, but also confirmed they are seeing lots of big money business.

That takes the edge off my fear that futures market buying alone is driving this rally. That won't work, long term. As they say in the futures business, "Sooner or later, everything comes back to physicals." Futures can rise for a while in the absence of demand for physical, but not for long.

And proving once again that the Bib Banks in the US & around the world are all criminal enterprises, the Fed fined Goldman Sachs $36.3 million for fencing and using confidential Fed supervisory information. All the banks are the same: they shrug these wrist slaps off as a "cost of doing business."

What's that you say? Did any bankers go to jail? Never. Don't y'all know that bankers are ABOVE the law? The law only applies to us unwashed hoi polloi.

Anybody want to begin laying bets that interest rates have seen their low? That's another way of asking, Have bonds peaked? Looky here, http://schrts.co/d3HP1X

That's a 4-2/3 year chart of the US 30 year Treasury bond. Made an all-time, all-time high on 8 January 2016. Now meditate on this until your joints turn to water: what will happen when markets wrest interest rate control out of Janet Yellen's cold, uncalloused hands? How far will the havoc reach? What will the stampede out of bonds look like? Not saying it has started yet, but a throwover of a 30 year channel with a 4+ year rising wedge, well, it's sure enough a candidate for reversal.

Speaking of candidates, National Proletarian Radio, the Voice of International Socialism, ran an article yesterday about the presidential candidates' religion. Mercy! The twain of them together don't know as much about religion as a hog knows about a sidesaddle. It was surely entertaining, though, with Trump talking about Norman Vincent Peale & Hillary talking about John Wesley like she knew him personally, and him dead these 225 years. They could only get by with this in a nation where theological and historical ignorance is near total.

The Old Testament Hebrew law provided that prophets whose prophecies failed to come true be stoned. It sure cut down on false prophets & gassy prophecies. In America today we don't have that salutary law, so people trying to sell newsletters using the most successful sales appeals -- fear & greed -- make prophecies about the US dollar being replaced on 30 September 2016. Now I don't know if it will or won't, and other than them listening in on my phone calls & watching me from outer space, I have no connection to the CIA or NSA or anybody else who might have inside information. I sure as this world have none of that, I'm no more'n a nat'ral born durned fool from Tennessee, & I've been on the outside from the beginning.

But I'll tell y'all what. I'll bet y'all a pound of bacon that on 1 October 2016 the US dollar will still be functioning. And I don't want any of that sorry storebought bacon, I want the real stuff. And regardless of the prophecies, I'd still be buying silver & gold. Blasted central bankers are destroying their currencies.

I'm having so much fun here I hate to get down to business, but y'all don't have all night.

Let's talk about the scrofulous, scurvy, boil-covered fiat currencies first. The least rotten of the whole rotten lot, the US dollar index, rose 0.2% to 95.72. However, it's looking at that 95.90 level like it was the gallows and the dollar index a condemned criminal. Must climb over that 95.90 level or fall further. Closed above the 50 DMA and 95.50 support, but still weak as a day old kitten.

Euro sank 0.19% to $1.1130. Criminal central bankers must sit up nights chain smoking & drinking bad coffee, trying to figure out how to manipulate the euro up. Yen was flat at 98.82.

Stocks today were confused, contradicting each other. Dow fell 2.95 (0.02%) while the S&P500 rose 0.46 (get out your microscope, 0.02%). They're broke and need a couple of zillion more dollars of Fed stimulus to get unbroke.

It's not like silver & gold had a banner day either. On Comex silver mislaid 3¢ somewhere for a 2040.6¢ close. Gold rose $2.70 to $1,358.80. Not much going on.

Gold chart appeareth here, http://schrts.co/Eyyuq1

Only thing that transpired was gold touched back to the upper channel boundary after breaking out through it a few days ago. Today it confirmed that breakout by going back to that line for one last Good-Bye Kiss. First indication you would have that my interpretation is incorrect would be a close below that blue uptrend line, tomorrow about $1,341.

Silver, remember, is always more volatile than gold, both upside & downside. Today silver bumped into its 20 DMA, but remaineth safely distant from the blue uptrend line about 2000¢. Any close below that would signal trouble. Don't borrow trouble before it signals.

Y'all don't forget what I said yesterday about those US$5 gold commemoratives minted 1986-2008. Best buy on the market in a fractional-ounce coin, about 3.5% over melt. Cheaper than most one ounce coins, like American Eagles, Krugerrands, Maple Leaves, etc. US$5 Commems contain 0.241875 troy ounce of pure gold, about a quarter-ounce. Considering that most coins that size cost 6.5% to 14% over their gold content, this can't last long. Call us at (888) 218-9226 or (931) 766-6066 for a quotation.

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
4-Aug-16 Price Change % Change
Gold, $/oz 1,358.80 2.70 0.20%
Silver, $/oz 20.41 -0.03 -0.15%
Gold/Silver Ratio 66.588 0.230 0.35%
Silver/Gold Ratio 0.0150 -0.0001 -0.35%
Platinum 1,161.90 -5.00 -0.43%
Palladium 704.75 -7.80 -1.09%
S&P 500 2,164.25 0.46 0.02%
Dow 18,352.05 -2.95 -0.02%
Dow in GOLD $s 279.19 -0.60 -0.21%
Dow in GOLD oz 13.51 -0.03 -0.21%
Dow in SILVER oz 899.35 1.18 0.13%
US Dollar Index 95.72 0.19 0.20%
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: 1,358.00      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,393.31 1,403.49 1,403.49
1/2 AE 0.50 692.07 716.35 1,432.69
1/4 AE 0.25 349.43 364.96 1,459.85
1/10 AE 0.10 142.49 148.70 1,487.01
Aust. 100 corona 0.98 1,321.79 1,330.79 1,357.68
British sovereign 0.24 322.07 335.07 1,423.41
French 20 franc 0.19 255.44 259.44 1,389.61
Krugerrand 1.00 1,366.15 1,376.15 1,376.15
Maple Leaf 1.00 1,368.00 1,382.00 1,382.00
1/2 Maple Leaf 0.50 780.85 712.95 1,425.90
1/4 Maple Leaf 0.25 346.29 363.27 1,453.06
1/10 Maple Leaf 0.10 143.95 148.02 1,480.22
Mexican 50 peso 1.21 1,625.74 1,636.74 1,357.51
.9999 bar 1.00 1,362.75 1,370.00 1,370.00
SPOT SILVER: 20.37      
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 14,274.98 14,560.98 20.37
US 40% silver 1/2s 0.30 5,815.93 5,965.93 20.22
100 oz .999 bar 100.00 2,016.50 2,081.50 20.82
10 oz .999 bar 10.00 205.15 210.15 21.02
1 oz .999 round 1.00 20.17 20.92 20.92
Am Eagle, 200 oz Min 1.00 21.87 23.37 23.37
SPOT PLATINUM: 1,161.90      
PLATINUM Fine Tr.Oz. BID ASK $/oz
Plat. Platypus 1.00 1,176.90 1,206.90 1,206.90
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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

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.

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