Friday, May 18, 2007

Silver and Gold Fighting to Hold On.

Gold Price Close Last Week : 670.60
Gold Price Close This Week: 661.00
Change: -9.60 or -1.4%

Silver Price Close Last Week : 1321
Silver Price Close This Week: 1298
Change: -23.00 cents or -1.7%

SILVER & GOLD PRICES have teetered in a make it or break it situation for a long time without doing either. Alas, time & markets wait for no one & no thing. I somewhat mistrust today's rise, since silver didn't close over 1300 -- bad for morale. First two or three days next week silver & gold will be fighting to hold on. If we haven't already seen a bottom, we should then. I expect to see a pattern this summer contrary to the regular seasonal pattern, with prices rising thru the summer.

Time to stop & look under the walnut shells for the pea. (The Fed & the US government are cheating you in the shell game of inflation.)

Look at that stock market! The Dow Jones Industrial Average has risen from 11,722 in January 2000 to a new high today at 13,556.53. Nay, O unanalytic one! Thou art deceiving thyself. Ponder:from the 1/2000 high the Dow has gained 15.7% -- great, huh? You'd like some of that, huh? But in order to keep pace with inflation, the Dow today would need to be 13,988.80, up 19.3% from 2000.

Consider the whole picture in real money: gold. On 14 January 2000 the Dow in Gold Dollars stood at G$853.59 (41.29 oz); today the Dow costs only G$423.96 (20.51 oz). In other words, the Dow has fallen 50.3% against gold.

On 14 January 2000 the Dow cost 2,293.23 ounces of silver; today it costs 1,044.42. Stocks have dropped 54.5% against silver. Stocks haven't gone up -- the dollar has gone down.

All the gains in stocks since 2000 are an illusion. A will of the wisp. All those who continue to allow themselves to be hypnotized by numbers instead of realities are fated to lose their capital. "In a bear market, money returns to its rightful owner." Swap stocks for silver & gold.

The US DOLLAR INDEX dropped this week below 82, but speedily climbed back to test 82.35 again. This try bounced off and it closed today at 82.175, but it will try again soon, and probably break thru to higher prices. A dollar rally is coming, I believe, but do not assume that means silver & gold will drop. They can quite easily run along with silver & gold for a while, up or down, as we've seen in the past.

Y'all enjoy your weekend.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"

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 $1,250.00; silver's primary is up targeting 16:1 gold/silver ratio or $78.13; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.