Monday, December 10, 2007

Hold on to Silver & Gold, & Buy More

Gold Price Close Today : 807.70
Change: 13.30 or 1.7%

Silver Price Close Today : 14.674
Change: 34.9 cents or 2.4%

US Dollar Index Today: 76.08
Change: -0.2 or -0.3%

Thursday through Saturday last week my wife & I attended the Acres USA conference in Louisville. Whoa. I am speechless. I haven't been around that many bright, intelligent countenances in a long time. No question that conventional agriculture is already dead, & will be replaced by the New Agriculture.

The GOLD PRICE action today persuades me that the market expects Bernanke to drop 50 bps, since it rose 13.30 & closed above 801.20, which had been unbeatable resistance since 28 November. What BB will do I haven't a clue, but I can assure you that lowering interest rates is not a currency-strengthening act. Dollar may rally a few months due to sheer lunacy, but 'twill drop mightily next year, while silver & gold will prosper.

The SILVER PRICE close today at 14.674 was its highest since 26 November, & its first above 1445., so both silver & gold have broken through short term resistance.

But anything can happen tomorrow. That's what I love about government meddling in the economy: it totally wrecks your ability to plan & forecast.

Bottom line: hold on to silver & gold, & buy more. Continue getting out of stocks, US Dollars, and investments that promise to pay you US dollars and into silver & gold.

Res ipse loquitur -- the numbers above speak for themselves, quite loudly. While the US Dollar index has risen & fallen, risen & fallen, it has made no real headway, only established 76 as new support. The Bush administration proposal Friday to freeze interest rates on adjustable rate mortgages is another act of subverting both economy & logic. Where in the world do these people get these ideas? Can't you see 'em all, the whole cabinet or all the apparatchiki at the Treasury, all sloshed, laughing, uproariously as they think up more & more ridiculous ways to bail out the banks? And of course the biggest drug dealer -- the greatest seller of toxic securities -- Goldman Sachs, has sent its former CEO to head up the US Treasury. That's the best joke of all. Man! Where's Madame Lafarge when you need her? Or for that matter, Madame Guillotine?

STOCKS keep on climbing, & this shouldn't surprise any of y'all. They have gained some on gold, as seen by the Dow in Gold Dollars (DiG$) climbing to G$351.32 (16.995 oz) today, after hitting G$354.56 (17.152 oz) on Friday. If tomorrow Berzerker Bernanke lowers interest rates another 50 basis points, expect stocks to surge for a day or two, then lose steam.

By the way, all those hopeless optimists who believe home prices are going to recover next year -- or even the year after -- are waiting for a very bad surprise. The market topped, the bubble popped, & home prices will drop & keep on dropping until they lose 50% to 95% of their peak value. If you're waiting for those prices to come back, I hope you're young, because us old folks don't have that much time.

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.