The Moneychanger
Daily Commentary
Tuesday, 27 September a.d. 2016 Browse the commentary archive

I did a roughly one hour web interview today with David Simpson of the True Money Show on the Veritas Radio Network. It was fun, not stuffy but lively, talking about gold & silver but also alternative banking & other things. You can download it here,

Silver & gold slid a little more today, gold down $6.50 (0.5%) to $1,319.40 & silver down 4.3¢ (02%) to 1904.4¢. They have advanced steadily in the aftermarket, to $1,322.70 and 1922.5¢.

Look at this gold chart,

Here 'tis: There is a channel outlined by the dashed blue lines. I put red arrows top & bottom. Gold is playing footsie with that heavy green line, the uptrend line from the December 2015 low. Yes, that is important. Note that it punched through that line four days in mid-September, but always without following through lower. Lo, it's in the same case today.

What does that mean? That most likely gold will catch someplace above $1,315 & reverse upward. If not, it might trek all the way to the lower channel line, now about $1,290. Not likely, since gold has that little uptrend going since September. Since I am not the only one who can draw lines on a chart, we assume others will see and buy near that uptrend line, offering plentiful support.

Frankly, I can't get worked up about a drop of $20 or $30 dollars, simply because the NEED to hold gold and protect yourself against financial crisis and mismanagement so much outweighs any little $30 risk. Also, I am firmly persuaded that gold is in an uptrend that won't even begin to let go until it reaches $1,450, and that is only the beginning. AND there's a bond bubble bursting, and a stock bubble, and a real estate bubble, and an automobile loan bubble, & a student loan bubble, ON TOP OF an unfolding bank solvency crisis in Europe.

In the face of all that, thirty bucks isn't even chump change.

Silver slowed its fall today & made a low at 1898¢. Chart's here,

Similar to gold, silver has entered a trading channel since July. Top line of that channel today is about 2000¢, bottom about 1775¢. Like gold, it has again punched into an uptrend line as it did a few weeks ago, but a different uptrend line. This one reaches back only to the June low. Silver has yet to come near the uptrend line form the December low. Strong as a garlic milkshake.

Today might have marked the bottom of the decline. We'll know tomorrow, but again, I don't expect any big break. Course, I could always be wrong.

On 28 September 1066 William the Conqueror, a Norman Viking, invaded England. Surprising everyone, he won. The conquering Normans forced their hoity-toity French words onto Anglo-Saxon English and the resulting pidgin because the world's most widely spoken language today. And that, dear readers, is why when the food comes to your table, you eat pork chops, not swine chops, and beef, not cow-flesh, and mutton, not sheep meat. That's also how your barnyard chicken becomes a pullet.

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
28-Sep-16 Price Change % Change
Gold, $/oz 1,319.40 -6.50 -0.49%
Silver, $/oz 19.04 -0.04 -0.23%
Gold/Silver Ratio 69.282 -0.184 -0.27%
Silver/Gold Ratio 0.0144 0.0000 0.27%
Platinum 1,021.90 -2.90 -0.28%
Palladium 713.50 13.35 1.91%
S&P 500 2,171.37 11.44 0.53%
Dow 18,339.24 110.94 0.61%
Dow in GOLD $s 287.33 3.14 1.10%
Dow in GOLD oz 13.90 0.15 1.10%
Dow in SILVER oz 962.99 7.98 0.84%
US Dollar Index 95.34 0.02 0.02%
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: 1,322.50      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,355.56 1,366.80 1,366.80
1/2 AE 0.50 673.97 697.62 1,395.24
1/4 AE 0.25 340.29 355.42 1,421.69
1/10 AE 0.10 138.76 144.81 1,448.14
Aust. 100 corona 0.98 1,285.94 1,294.94 1,321.10
British sovereign 0.24 313.65 326.65 1,387.64
French 20 franc 0.19 244.44 248.44 1,330.70
Krugerrand 1.00 1,333.08 1,343.08 1,343.08
Maple Leaf 1.00 1,332.50 1,346.50 1,346.50
1/2 Maple Leaf 0.50 760.44 694.31 1,388.63
1/4 Maple Leaf 0.25 337.24 353.77 1,415.08
1/10 Maple Leaf 0.10 140.19 144.15 1,441.53
Mexican 50 peso 1.21 1,580.06 1,591.06 1,319.61
.9999 bar 1.00 1,327.13 1,334.50 1,334.50
SPOT SILVER: 19.23      
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 13,710.13 13,996.13 19.58
US 40% silver 1/2s 0.30 5,479.63 5,629.63 19.08
100 oz .999 bar 100.00 1,902.50 1,937.50 19.38
10 oz .999 bar 10.00 193.75 198.75 19.88
1 oz .999 round 1.00 19.03 19.53 19.53
Am Eagle, 200 oz Min 1.00 20.73 22.23 22.23
SPOT PLATINUM: 1,021.90      
Plat. Platypus 1.00 1,036.90 1,066.90 1,066.90
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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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