The Moneychanger
Daily Commentary
Thursday, 22 December a.d. 2016 Browse the commentary archive

Markets are damping down for the holidays. Thin markets next week may produce some strange results, but without lasting effect. While the big fat mice are away, the lean & hungry mice will play.

Tomorrow, Friday, 23 December 2016 our office will be open only till noon, and I won't be sending a commentary. We will also be closed on St. Stephens Day, Monday, 26 December.

Stocks have stalled and pointed down. Dow lost 23.08 (0.12%) to 19,918.88 while the SP500 lost 4.22 (0.19%) to 2,260.96.

US dollar index is hovering. Rose 6 basis points (005%) to 103.08.

Gold edged back $2.30 (0.2%) to close Comex at $1,128.80. Silver lost 10.3¢ (0.6%) to 1581.5¢

Gold is looking more and more as if it is preparing to turn up. MACD is on the verge of turning up, & the RSI is still heavily oversold. Price action has flattened into a range the last six days. All this is merely preliminary, but like martins chittering in the spring, signs of a change.

Silver is flirting with the very rock bottom of its range, & indicators do not whisper a turnaround as gold's do.

All this is a waiting game. I still am operating on the conclusion that the December 2015 lows were THE lows for the 5 year correction, and therefore silver & gold have begun their next upleg. This present correction is merely the first downswing in the first upleg. Be patient, be patient.

Back in 1989 or 1990, I'm not sure of the year, Susan must have REALLY been frugalizing, because she made me promise we wouldn't give each other gifts. Christmas morning -- my children remember the scene if not the year -- I handed her a rolled up scroll and she said, "Oh, Franklin, you promised!" Inside was a poem I had written and calligraphed for her. She read the poem and cried. Maybe because it was so bad, but here 'tis anyway, for your Christmas enjoyment:

Have Christmas merry without gifts? What gift

Embraces all the love you've given me?

Find the equal? Love, without complaint you lift

In childlike faith your precious eyes, care-free

Receive each burden; love so full it bears

Sweet infant hearts new-made to praise her God.

'Tis not the money, but the task that tears

Likelihood and tramples hope roughshod:

One man could never find a present equal.

Vanquished, I must imitate, returning

Endless Threefold Grace original "

Devoted serve with self-forgetting yearning.

Until I give you back to Him complete

Such love as He gave me I must repeat.

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
23-Dec-16 Price Change % Change
Gold, $/oz 1,128.80 -2.30 -0.20%
Silver, $/oz 15.82 -0.10 -0.65%
Gold/Silver Ratio 71.375 0.317 0.45%
Silver/Gold Ratio 0.0140 -0.0001 -0.44%
Platinum 906.40 -6.90 -0.76%
Palladium 660.40 -3.30 -0.50%
S&P 500 2,260.96 -4.22 -0.19%
Dow 19,918.88 -23.08 -0.12%
Dow in GOLD $s 364.78 0.32 0.09%
Dow in GOLD oz 17.65 0.02 0.09%
Dow in SILVER oz 1,259.49 6.70 0.53%
US Dollar Index 103.08 0.06 0.06%
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: 1,128.80      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,162.66 1,166.61 1,166.61
1/2 AE 0.50 585.05 595.44 1,190.88
1/4 AE 0.25 298.16 303.37 1,213.46
1/10 AE 0.10 122.65 123.60 1,236.04
Aust. 100 corona 0.98 1,099.81 1,108.81 1,131.21
British sovereign 0.24 267.71 280.71 1,192.49
French 20 franc 0.19 210.75 216.75 1,160.94
Krugerrand 1.00 1,142.35 1,152.35 1,152.35
Maple Leaf 1.00 1,138.80 1,152.80 1,152.80
1/2 Maple Leaf 0.50 649.06 592.62 1,185.24
1/4 Maple Leaf 0.25 287.84 301.95 1,207.82
1/10 Maple Leaf 0.10 119.65 123.04 1,230.39
Mexican 50 peso 1.21 1,351.36 1,362.36 1,129.93
.9999 bar 1.00 1,133.32 1,138.80 1,138.80
SPOT SILVER: 15.82      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 23.00 27.00 35.29
VG+ Peace dollar 0.77 17.00 20.00 26.14
90% silver coin bags 0.72 11,665.23 11,951.23 16.72
US 40% silver 1/2s 0.30 4,473.68 4,623.68 15.67
100 oz .999 bar 100.00 1,571.50 1,596.50 15.97
10 oz .999 bar 10.00 159.65 164.65 16.47
1 oz .999 round 1.00 16.07 16.37 16.37
Am Eagle, 200 oz Min 1.00 17.32 18.82 18.82
SPOT PLATINUM: 906.40      
Plat. Platypus 1.00 921.40 951.40 951.40
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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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