The Moneychanger
Daily Commentary
Monday, 19 June a.d. 2017 Browse the commentary archive

I've been gone nearly two weeks and have come back refreshed & renewed & game enough to fight a circle saw.

I will quickly summarize what I think is happening, and expatiate & bloviate tomorrow.

First, lots of headlines are being made today by the big jump in tech stocks. Nobody mentions that since June 9 they have sunk like a lump in a churn, so they haven't really gained new ground, just look a little less feckless & doomed than they did.

Today the Dow & S&P500 hit new all time highs. Dow rose 144.71 (0.685) to 21,528.99 while the S&P climbed 20.31 (0.83%) to 2,453.46. Both indices gapped up, which, stock-lover-&-optimist that I am I call a potential exhaustion gap. Whether 'tis or not, stocks are merely blowing up the bubble for a bigger pop soon. Tech stocks, it seems, have already popped.

Another evil milestone was passed last week when the looney from Illinois shot up Republican politicians. The left has escalated violence & threat of violence (remember the comedienne & Pres. Trump's head) so intensely that their lunatic fringes now believe it's okay to murder non-lefties. Throws a mighty dark shadow over the future.

In line with that, I have been reading Armando Valladares Against All Hope, the story of his years in Cuban Communist prisons. You can get a copy off for less than $5, and it will make you see many events in a clearer light. He & the comrades he chronicles were indescribably brave, unspeakably tough.

I have concluded that them Federal Reserve people's cornbread ain't done all the way to the middle. With no more sense than God gave a screwdriver, they raised interest rates last week AND announced they are undertaking the HUGELY deflationary step of trimming down their balance sheet: in the teeth of history's greatest debt bubble.

None of that helped the dollar, which continues trying to break through 97.70 with an amazing want of success. Closed 97.26 today, up 40 basis points (0.41%). Chart lies here,

HOWEVER, both the Euro & the Yen may have turned down against the dollar.

On Comex today gold closed $1,244.20, lower by $9.80 or 0.8%. Silver fell 15.3¢ (0.9%) to 1648.3¢.

Gold chart here, , says that Gold will visit the 200 day moving average at $1,242.52. Watch for it to turn up from there. Remember gold is locked in a seasonally-low time of year. Just settle down, take a deep breath, everything will be all right. Yankee government, Federal Reserve, & whole American system are working in gold's favor, not to mention history's biggest debt bubble.

Silver chart at says silver will hit that red downtrend line from the July 2016 high before it stops & turns around --- probably tomorrow.

What I have warned about for years finally happened: premiums on all one oz gold coins today were both the same and much lower than they have been the last 2 decades. Wholesale buy was spot plus 0.5% for Krugerrands, Buffalos, and American Eagles. Indicates low retail public buying, stout public retail selling, and a degree of social complacency sufficient to drive overbought stock market indices to new high. Say, that happened today, didn't it?

Y'all just wait. Some economic bomb will blow that Smug Castle sky high.

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
19-Jun-17 Price Change % Change
Gold, $/oz 1,244.20 -9.80 -0.78%
Silver, $/oz 16.48 -0.15 -0.92%
Gold/Silver Ratio 75.484 0.105 0.14%
Silver/Gold Ratio 0.0132 -0.0000 -0.14%
Platinum 926.00 0.10 0.01%
Palladium 875.85 -12.80 -1.44%
S&P 500 2,453.46 20.31 0.83%
Dow 21,528.99 144.71 0.68%
Dow in GOLD $s 357.69 5.18 1.47%
Dow in GOLD oz 17.30 0.25 1.47%
Dow in SILVER oz 1,306.13 20.71 1.61%
US Dollar Index 97.26 0.40 0.41%
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: 1,242.70      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,248.91 1,284.33 1,284.33
1/2 AE 0.50 633.27 655.52 1,311.05
1/4 AE 0.25 319.74 333.98 1,335.90
1/10 AE 0.10 130.38 136.08 1,360.76
Aust. 100 corona 0.98 1,207.13 1,216.13 1,240.70
British sovereign 0.24 294.73 307.73 1,307.25
French 20 franc 0.19 229.69 233.69 1,251.70
Krugerrand 1.00 1,248.91 1,258.91 1,258.91
Maple Leaf 1.00 1,250.70 1,266.70 1,266.70
1/2 Maple Leaf 0.50 714.55 652.42 1,304.84
1/4 Maple Leaf 0.25 316.89 332.42 1,329.69
1/10 Maple Leaf 0.10 131.73 135.45 1,354.54
Mexican 50 peso 1.21 1,484.72 1,495.72 1,240.54
.9999 bar 1.00 1,247.05 1,254.70 1,254.70
SPOT SILVER: 16.46      
SILVER Fine Tr.Oz. BID ASK $/oz
VG+ Morgan $B4 1905 0.77 22.50 25.50 33.33
VG+ Peace dollar 0.77 15.00 18.00 23.53
90% silver coin bags 0.72 11,443.58 11,729.58 16.41
US 40% silver 1/2s 0.30 4,662.48 4,812.48 16.31
100 oz .999 bar 100.00 1,625.50 1,660.50 16.61
10 oz .999 bar 10.00 166.05 171.05 17.11
1 oz .999 round 1.00 16.26 16.86 16.86
Am Eagle, 200 oz Min 1.00 17.96 19.46 19.46
SPOT PLATINUM: 926.00      
Plat. Platypus 1.00 941.00 971.00 971.00
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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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