The Moneychanger
Daily Commentary
Thursday, 1 December a.d. 2016 Browse the commentary archive

Y'all know how you'll meet somebody & they look good & they sound good & they smell good, but somethin' just ain't right about 'em? You can't necessarily point your finger to it, but you know they're bogus as an $8 bill.

That's how the stock market left me feeling today. The Dow Industrials, which all & sundry watch as "The" stock market index tho it ain't, rose 68.35 (0.36%) -- all alone. All the other indices fell. S&P500, for example, fell 7.73 (0.35%) to 2,191.08. Nasdaq fell 1.36%, Nasdaq 100 fell 1.59%, Russell 2000 fell 0.65%.

Somethin' ain't right.

Look here at the S&P500 chart,

Yesterday it posted the first half of a key reversal (break to new high intraday with a lower close for the day) and added the second half today (lower close). This comes after breaking out of a death-dealing rising wedge? What does that say to y'all but "Lower prices comin'!"

US dollar index continues to tread air sideways, but gravity grabbed its heel today. Lost 44 basis points (0.43%) to 101.1. When it cracks that ice at 100 support, all will learn it's wearing concrete boots.

Yen today rose 0.33% to 87.67. Euro added 0.65% to $1.0662.

Speaking of Europe, the Iron Hand of Popular Revulsion Against the Establishment is poised to rake more dominoes off the table. Italians have a constitutional referendum this week it appears the sitting government will lose. French are dragging their way through a presidential election and the top contenders are Francois Fillon, a Thatcherite, and nationalist, anti-immigration, anti-EU National Front's Marine Le Pen. Incumbent Francois Hollande (Socialist) just announced he will not run again. In Germany Angela Merkel the Ferkel has just announced she'll run for a fourth term, although her pro-immigration-and- don't-count--the-rapes stance has made her as popular at a skunk at a wedding. In Holland Geert Wilders, founder of the Party for Freedom, is being tried for hate crimes because he criticized immigrants living in Holland.

What do all these folks have in common, and ignore the "right wing", "far right," "fascist" labels the Establishment's yellow running dog press puts on them? They all oppose all the Establishment's post World War II policies, & not immigration alone.

Should any of those dominoes fall off the table, the euro will become merely very decorative wallpaper.

Let all that go & let's think about silver & gold a second. Finally today I saw something I liked.

Comex spot month gold closed at $1,166.90, down $3.90 or 0.3%. Silver rose 2.1¢ 90.13%) to 1642.7¢.

What's to like in that? Gold was hammered down $8.80 to $1,162 about 11:00 a.m. Eastern, but climbed back to close higher, but also to trade at $1,174 in the aftermarket. I know, that's a small recovery, but it's more spunk than gold has been showing lately.

Silver was driven down to 1622¢ but rallied and after that low hit 1665¢. Yes, it fell back on the close, but it looks strong when a market bounces back after having the snot knocked out of it.

That's it: nothing more than a little cloud no bigger than a man's hand on the horizon. Let's see if it brings rain.

I apologize in advance: I'll miss y'all tomorrow. Two of my sons, spouses, & children are going with me to visit our friends Pam and Jim Smith, in Erin, Tennessee. Jim operates the Back to the Land Store,, an agrarian outfitter. He also knows how to do everything from driving mules to stealing pigs noiselessly. His wife Pam is a home economist and one of the greatest cooks I have ever met. Nothing edible she can't make superbly. Pam & Jim are going to give us lessons in making sausage and sourdough bread. Sourdough was Susan's latest project, and she bought a monster Swedish mixer from Jim, capable of kneading iron filings and concrete. She also bought the sausage making attachment. Susan had cracked the secret of sourdough before she died, but had not time to teach anybody else. So we're headed to Erin for sourdough & sausage lessons. Y'all enjoy your weekend.

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
1-Dec-16 Price Change % Change
Gold, $/oz 1,166.90 -3.90 -0.33%
Silver, $/oz 16.43 0.02 0.13%
Gold/Silver Ratio 71.035 -0.329 -0.46%
Silver/Gold Ratio 0.0141 0.0001 0.46%
Platinum 909.60 15.00 1.68%
Palladium 751.00 -20.65 -2.68%
S&P 500 2,191.08 -7.73 -0.35%
Dow 19,191.93 68.35 0.36%
Dow in GOLD $s 339.99 2.34 0.69%
Dow in GOLD oz 16.45 0.11 0.69%
Dow in SILVER oz 1,168.32 2.67 0.23%
US Dollar Index 101.10 -0.44 -0.43%
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: 1,171.10      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,207.40 1,210.33 1,210.33
1/2 AE 0.50 596.75 617.76 1,235.51
1/4 AE 0.25 301.30 314.73 1,258.93
1/10 AE 0.10 122.86 128.24 1,282.35
Aust. 100 corona 0.98 1,142.17 1,151.17 1,174.43
British sovereign 0.24 277.74 290.74 1,235.11
French 20 franc 0.19 216.46 220.46 1,180.81
Krugerrand 1.00 1,188.67 1,198.67 1,198.67
Maple Leaf 1.00 1,181.10 1,195.10 1,195.10
1/2 Maple Leaf 0.50 673.38 614.83 1,229.66
1/4 Maple Leaf 0.25 298.63 313.27 1,253.08
1/10 Maple Leaf 0.10 124.14 127.65 1,276.50
Mexican 50 peso 1.21 1,404.82 1,415.82 1,174.27
.9999 bar 1.00 1,175.20 1,183.10 1,183.10
SPOT SILVER: 16.48      
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 12,462.45 12,748.45 17.83
US 40% silver 1/2s 0.30 4,669.85 4,819.85 16.34
100 oz .999 bar 100.00 1,628.00 1,663.00 16.63
10 oz .999 bar 10.00 166.30 171.30 17.13
1 oz .999 round 1.00 16.28 16.78 16.78
Am Eagle, 200 oz Min 1.00 17.98 19.48 19.48
SPOT PLATINUM: 909.60      
Plat. Platypus 1.00 924.60 954.60 954.60
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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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