The Moneychanger
Daily Commentary
Monday, 17 October a.d. 2016 Browse the commentary archive

Dear Friends:

Susan and I spent so many decades together serving y'all that I am sure she'd be madder than a wet wasp if I lay down in the road & quit. Besides, my seven children are with me, hovering around as if I'm going to drown myself in the toilet or starve to death eating salads. I know they are doing it out of love, but I feel like I have to keep typing just so they'll know I still have two marbles to rub together.

However, my meditations of the last few days have resulted in some advice for men, so hear my words:

First, when you fill the saltshaker or change a light bulb, don't expect your wife to drop everything and praise you. Remember that she was probably so busy doing laundry, shopping, cooking, caring for kids and for others that she didn't have time for the saltshaker today. It probably wasn't that important. Look for something else to do for her, to lighten her load. And thank her, instead of expecting her to thank you. Praise her.

Second, hug your wife. Tell her you love her. Mercy, women, hug your husbands, oto. Susan used to complain that I didn't know how to hug because I didn't hug hard enough or long enough. Go ahead, spend that extra nano- second hugging. You'll never miss it. And squeeze harder.

My webmaster has posted Susan's picture and obituary as well as her eulogy from her funeral at I cannot even begin to thank y'all for your kind condolences. Thank you for helping us bear our burdens.


For a week metals have trudged sideways while stocks broke down out of an even-sided triangle & continue to lose ground. US dollar index has reached 98, but backed off 12 basis points today to 97.88. Dollar index has crushed the euro, and steamrolled the yen. So trends are down for stocks, up for the US dollar index, sideways for gold & silver.

But there's something mighty suspicious happening with silver & gold premiums. Week ending October 7th the wholesale US 90% silver coin premium reached 90¢ over spot silver, then last week 135¢. Now we are hearing noises of shortages of silver rounds. In itself that might not mean much, but the in the last few days premiums on gold have begun to rise as well. Buy side wholesale premium for Krugerrands went from 0.8% to 1.2%, for American Eagles from 2.5% lately to 3%, and Austrian 100 coronas and Mexican 50 pesos from 991% to 99.4%.

It's the gold that makes a buzzing in my ear. The 90% premium alone implies greater demand at these prices is pushing up premiums, but when you add to that rising gold coin premiums, only very rarely seen, then it appears that very strong support stands under silver & gold.

Today on Comex silver added a measly 3.3¢ to 1742.6¢. Gold bumped up $1.30 to $1,254.40. Ratio is 71.984.

Both silver & gold have formed pennants, which might be downward sloping bullish flags. For the present, the 200 day moving average is supporting both metals. Gold chart is here,

Y'all will immediately notice how oversold the RSI is, and that the MACD is trying to turn up.

Here is silver,

Same oversoldness shows in the RSI, same desire to turn up in the MACD, same pennant formation, which will either be a reversal or continuation.

It's beginning to look like silver & gold have found sound footing.

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
17-Oct-16 Price Change % Change
Gold, $/oz 1,254.40 1.30 0.10%
Silver, $/oz 17.43 0.03 0.19%
Gold/Silver Ratio 71.984 -0.062 -0.09%
Silver/Gold Ratio 0.0139 0.0000 0.09%
Platinum 932.70 -3.20 -0.34%
Palladium 636.75 -10.05 -1.55%
S&P 500 2,126.50 -6.48 -0.30%
Dow 18,086.40 -51.98 -0.29%
Dow in GOLD $s 298.05 -1.17 -0.39%
Dow in GOLD oz 14.42 -0.06 -0.39%
Dow in SILVER oz 1,037.90 -4.96 -0.48%
US Dollar Index 97.88 -0.12 -0.12%
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: 1,253.90      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,291.52 1,295.91 1,295.91
1/2 AE 0.50 638.98 661.43 1,322.86
1/4 AE 0.25 322.62 336.99 1,347.94
1/10 AE 0.10 131.55 137.30 1,373.02
Aust. 100 corona 0.98 1,221.70 1,230.70 1,255.56
British sovereign 0.24 297.38 310.38 1,318.53
French 20 franc 0.19 231.76 235.76 1,262.79
Krugerrand 1.00 1,268.95 1,278.95 1,278.95
Maple Leaf 1.00 1,263.90 1,277.90 1,277.90
1/2 Maple Leaf 0.50 720.99 658.30 1,316.60
1/4 Maple Leaf 0.25 319.74 335.42 1,341.67
1/10 Maple Leaf 0.10 132.91 136.68 1,366.75
Mexican 50 peso 1.21 1,502.63 1,513.63 1,255.40
.9999 bar 1.00 1,258.29 1,265.90 1,265.90
SPOT SILVER: 17.42      
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 13,134.55 13,420.55 18.77
US 40% silver 1/2s 0.30 4,947.15 5,097.15 17.28
100 oz .999 bar 100.00 1,722.00 1,757.00 17.57
10 oz .999 bar 10.00 175.70 180.70 18.07
1 oz .999 round 1.00 17.22 17.72 17.72
Am Eagle, 200 oz Min 1.00 18.92 20.42 20.42
SPOT PLATINUM: 932.70      
Plat. Platypus 1.00 947.70 977.70 977.70
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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.

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