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

Here's a handy statistic. Total market capitalization of all cryptocurrencies is about $240 billion. Is that strange? Has the sudden rise of cryptocurrencies affected the price of silver & gold? By comparison, 2016 gold production was worth $130 billion, silver production worth $15 billion. So much for the "scarcity" argument for cryptocurrencies.

The "safety" argument is shredding a little, too. On 19 November somebody hacked Tether, which issues a cryptocurrency used by Bitcoin exchanges to trade national currencies. Whoops, the hackers made off with $31 million in tether tokens. Did y'all know there is no FDIC insurance on cryptocurrencies?

In an article from today are listed 26 hacks since 2010 that have relieved owners of $640,153,000 worth of cryptocurrencies.

Hope y'all are careful who you trust!

Speaking of Bitcoin, it ranged today from $8,362.30 to $7,818.50,a modest 8.6% (cough). Hope y'all have nerves of titanium. Closed down $66.53 at $8,171.67. but sometime in the last 24 hours made a new all time high around $8,360.

Janet Yellen resigned effective year end not only as the chairman of the Federal Reserve but also from the Board of Governors. Trump will appoint Jerome Powell replace her, has already appointed on other new governor, and will appoint three more replacements. Looks like it will be a Trump Federal Reserve board.

Heartening development? "Better the devil you know than the devil you don't know." Powell I hear is a long time apparatchik who won't rock the boat, but boat rocking seems to be what Trump & his appointees excel at. To borrow a line from PJ O'Rourke, Trump appointing Federal Reserve Board members might be like giving teenage boys two cases of beer and the car keys. Or teenage girls an American Express card and airline tickets to New York.

More of the same today in Markets.

US dollar index lacked the shoes or strength to tap dance on through 94. Instead it turned back and lost 12 basis points (0.13%) to close at 93.87. So far it has been caught by the 50 day moving average (93.38), but the uptrend hath been shattered.

Stocks made new all time highs today. Dow added 160.50 (0.69%) to 23,590.83. SP500 gained 16.89 (0.65%) to close at 2,599.03. Both indices might just as likely spurt higher as break down. No change shows yet. Trend in force remains in force until broken.

Silver closed Comex 12.2¢ (0.7%) higher at 1694.9¢. Gold bounced back $6.50 or 0.5% to $,281.10.

Behold the gold chart, Nothing in this chart suggests strength except barely positive momentum indicators. Meanwhile gold and silver's breakouts Friday so quickly contradicted Monday do not promise good things. An upward "fake-out breakout" shows underlying weakness, lots of sellers waiting atop the range.

Silver's chart, shows no excitement except the big jump in volume on yesterday's slide. This is not a recipe for higher prices, but neither is it a guarantee of lower prices, although the weight leans that direction.

Wait and watch. Can't make a silk purse out of a sow's ear.

On 21 November 1787 Andrew Jackson was admitted to the bar. Twenty minutes later, a fight broke out in the bar.

On 21 November 1953 Piltdown Man, discovered in England in 1912 and held out as the "missing link" in evolution, was proved a hoax. Whoops.

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-Nov-17 Price Change % Change
Gold, $/oz 1,281.10 6.50 0.51%
Silver, $/oz 16.95 0.12 0.73%
Gold/Silver Ratio 75.586 -0.162 -0.21%
Silver/Gold Ratio 0.0132 0.0000 0.21%
Platinum 934.00 14.40 1.57%
Palladium 997.90 10.40 1.05%
S&P 500 2,599.03 16.89 0.65%
Dow 23,590.83 160.50 0.69%
Dow in GOLD $s 380.66 0.66 0.17%
Dow in GOLD oz 18.41 0.03 0.17%
Dow in SILVER oz 1,391.87 -0.55 -0.04%
US Dollar Index 93.87 -0.12 -0.13%
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: 1,279.40      
GOLD Fine Tr.Oz. BID ASK $/oz
American Eagle 1.00 1,298.59 1,322.26 1,322.26
1/2 AE 0.50 651.98 674.88 1,349.77
1/4 AE 0.25 329.19 343.84 1,375.36
1/10 AE 0.10 134.23 140.09 1,400.94
Aust. 100 corona 0.98 1,241.53 1,254.07 1,279.40
British sovereign 0.24 303.43 316.43 1,344.22
French 20 franc 0.19 236.48 240.48 1,288.03
Krugerrand 1.00 1,283.24 1,293.24 1,293.24
Maple Leaf 1.00 1,287.40 1,303.40 1,303.40
1/2 Maple Leaf 0.50 735.66 671.69 1,343.37
1/4 Maple Leaf 0.25 326.25 342.24 1,368.96
1/10 Maple Leaf 0.10 135.62 139.45 1,394.55
Mexican 50 peso 1.21 1,527.02 1,538.02 1,275.62
.9999 bar 1.00 1,283.88 1,291.40 1,291.40
SPOT SILVER: 16.92      
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 11,736.73 12,022.73 16.82
US 40% silver 1/2s 0.30 4,798.18 4,948.18 16.77
100 oz .999 bar 100.00 1,671.50 1,706.50 17.07
10 oz .999 bar 10.00 170.65 175.65 17.57
1 oz .999 round 1.00 16.72 17.32 17.32
Am Eagle, 200 oz Min 1.00 18.42 19.92 19.92
SPOT PLATINUM: 934.00      
Plat. Platypus 1.00 949.00 979.00 979.00
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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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