The Moneychanger
Daily Commentary
Tuesday, 21 March a.d. 2017 Browse the commentary archive

Say, that government meat inspection is dyn-O-mite, ain't it? Some of the biggest beef & chicken producers in Brazil apparently bribed government meat inspectors to pass rotten meat and even doused it down with chemicals to hide the smell. Yeah, buddy, we need that regulation! It's foolproof.

Media today cited the delay in healthcare legislation & fear of further delays in Trump's tax cuts as the catalyst for today's stock market nosedive. Apparently they haven't ever heard of seething overvaluation or the "fullness of time."

Pushed off the cliff, the Dow fell 237.85 (1.14%) to 20,668.01, well below key 20,780 support. S&P500 sank 2.85 (1.24%) to 2,344.02. Both are broken, and if they can't catch a foothold at the 50 day moving averages (now 20,401 & 2,326) the bleeding will intensify.

Dow chart is here,

US dollar index shattered 100 and lost 69 basis points (0.64%) to end at 99.54. Look at this,

A break below 99 leads quickly to 97.50 & does wonders for silver & gold.

Gold jumped $12.0 (1%) flatfooted to $1,246.10 on Comex. Silver rose 14.7¢ (0.8%) to 1755¢. Look for gold chart here,

Just about the time I was fretting & chafing about gold stalling at $1,234, it punched clean through about 11:00 a.m. After that the sellers ran for cover until gold reached $1,246. Gold is now on a tear. Next barrier lies at $1,264, were the last high and the 200 day moving average run together.

Interest rates fell today and the bank stock index, BKX, sank 3.92%. The Gold/BKX spread, that shows which way public confidence is flowing, gapped up 5.13%, coming up off a double bottom. Likewise the Dow in Gold fell clean through its uptrend line today, feeling with its foot for a bottom but found none. These indicators confirm gold's price rally.

Y'all can find silver's chart here,

In the plainest terms, silver ought to have closed above 1760 but didn't. That's a soft non-confirmation of gold's rise. Silver has not even worked through its 20 DMA (1764¢), but sometimes the advancing metals play leapfrog, advancing together but alternatively. I'm probably vexing myself to no purpose.

STRATEGY: If you bought numismatic coins years ago, you've taken a hit. The premiums on these coins has been falling steadily since 1998, and they are now scrarping the bottom. I doubt they will ever recover. What should you do to pull this out of the fire?

You can swap the gold numismatic coins for silver. Yes, you will realize a loss on the gold, but positioning yourself in silver will give you the opportunity to increase ounces when the gold/silver ratio drops from its present 70 ounces of silver to one of gold down to 35 ounces of silver to one ounce of gold.

On 21 March 1556 Bloody Mary, English queen, burnt at the stake Anglican Archbishop Thomas Cranmer, leader of the English Reformation & author of most of the Book of Common Prayer. In the turmoil of his long imprisonment he recanted his Reformed beliefs, but Mary refused to pardon him as canon law required. On the day appointed for his execution he was supposed to recant finally and publically during a service in University Church. Once in the pulpit, he left his prepared script and renounced the recantations he had signed and said his right hand would be punished by being burned first. He was dragged from the pulpit and taken to the stake. As the fire leaped around him, he held out his right hand & repeated, "This unworthy hand, this unworthy right hand!" His last words were, "Lord Jesus, receive my spirit. I see the heaven open and Jesus standing at the right hand of God."

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
21-Mar-17 Price Change % Change
Gold, $/oz 1,246.10 12.50 1.01%
Silver, $/oz 17.55 0.15 0.84%
Gold/Silver Ratio 71.003 0.119 0.17%
Silver/Gold Ratio 0.0141 -0.0000 -0.17%
Platinum 970.60 -0.80 -0.08%
Palladium 789.65 6.00 0.77%
S&P 500 2,344.02 -12.65 -0.54%
Dow 20,668.01 -237.85 -1.14%
Dow in GOLD $s 342.87 -7.46 -2.13%
Dow in GOLD oz 16.59 -0.36 -2.13%
Dow in SILVER oz 1,177.66 -23.61 -1.97%
US Dollar Index 99.54 -0.69 -0.69%
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: 1,243.60      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,269.72 1,284.02 1,284.02
1/2 AE 0.50 633.73 656.00 1,312.00
1/4 AE 0.25 319.97 333.60 1,334.38
1/10 AE 0.10 127.99 135.93 1,359.25
Aust. 100 corona 0.98 1,209.83 1,218.83 1,243.45
British sovereign 0.24 294.94 307.94 1,308.15
French 20 franc 0.19 232.18 238.18 1,275.74
Krugerrand 1.00 1,256.04 1,266.04 1,266.04
Maple Leaf 1.00 1,253.60 1,266.60 1,266.60
1/2 Maple Leaf 0.50 715.07 652.89 1,305.78
1/4 Maple Leaf 0.25 317.12 332.66 1,330.65
1/10 Maple Leaf 0.10 131.82 135.55 1,355.52
Mexican 50 peso 1.21 1,485.79 1,496.79 1,241.43
.9999 bar 1.00 1,243.60 1,255.60 1,255.60
SPOT SILVER: 17.51      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 22.50 25.25 33.01
VG+ Peace dollar 0.77 15.50 18.00 23.53
90% silver coin bags 0.72 12,373.08 12,730.58 17.81
US 40% silver 1/2s 0.30 4,972.23 5,122.23 17.36
100 oz .999 bar 100.00 1,740.50 1,765.50 17.66
10 oz .999 bar 10.00 176.55 181.55 18.16
1 oz .999 round 1.00 17.76 18.06 18.06
Am Eagle, 200 oz Min 1.00 19.01 19.66 19.66
SPOT PLATINUM: 970.60      
Plat. Platypus 1.00 965.60 1,010.60 1,010.60
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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.

Other Important Information

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