Wednesday, July 02, 2008

Silver and Gold Prices Have Confirmed a Breakout Out of Correction and Into a New Rally

Gold Price Close Today : 944.80
Gold Price Close Yesterday: 942.50
Change: 2.30 or 0.2%

Silver Price Close Today : 18.337
Silver Price Close Yesterday: 18.20
Change: 13.7 cents or 0.8%

US Dollar Index Today: 72.06
US Dollar Index Yesterday:72.37
Change: -0.31 or -0.4%

STOCKS melted today, but the Dow stopped short of breaking through 11,200. S&P 500 fell 23.30, roughly equal to 233 on the Dow, which fell only 165.29. Dow probably will fall to 10,750. Along the way, Wall Street and its pimps will keep soothing you with words, assuring you this is a great time to buy. Like Ulysses and the Sirens, stop the ears of your crew and tie yourself to the mast before you listen to that song. It will leave you on the rocks. Swap stocks for silver and gold, while you still have time.

I really don't need to write anything about the US DOLLAR INDEX any longer, just copy the boilerplate from the day before: "Dollar dropped again today."This day's fall was 31 basis points, leaving the dollar hanging by its fingernails above 72 at 72.06. Friends, perhaps y'all don't realize the seriousness of the dollar's position. It has fallen from 120 in 2001 to about 72 today. Next target is 60, and that will complete a 50% drop in the dollar.

AND HEAR THIS: this isn't bad luck or hard markets or leaky vaults, this is the resolute and determined purpose of the Federal Reserve bank and its lackey, the US government. Right, surprise: they are stealing from you on purpose. They will continue to steal from you as long as you keep your assets in phoney-baloney US dollars. Forget the buck, shift to silver and gold as your primary currency.

The GOLD PRICE was only stymied by $946 today. As I suspected yesterday, exhilarating gold dragged the SILVER PRICE up to a new high close today, $18.337, enough to best the old $18.24 high. Now silver and gold prices have confirmed a breakout out of correction and into a new rally. The market is handing you an opportunity on a -- gulp! -- silver platter.

Gold can hit $1,300 by year end, silver who knows? In the last few days the GOLD/SILVER RATIO has dropped to 51.52. This leg down for the ratio will be astounding, stunning, and blitzschnell -- lightning fast.

ONE MORE THOUGHT on stocks against metals. The Dow In Gold Dollars (DiG$) fell today to G$245.42 (11.872 oz), lower than its 17 March low at G$247.14 (11.956 oz). I have charted the DiG$ since 1996, thanks to my friend Richard Ford suggesting it. It's the best single indicator I have ever followed. Now, after 12 years, the DiG$ has sunk lower than its level when I began watching it in 1996. There's really no floor under it now.

The Dow in Silver Today fell to 611 oz, a bit higher than its 14 March 2008 low at 580.85 oz, but headed down. Against both silver and gold, stocks have given up about 75% of their peak values (1999 & 2001). Ultimate bear market target is the Dow at two ounces of gold or less and silver at 32 oz or less.

Y'all overwhelm me.

Many of you have written to assure me that you are praying
for my granddaughter Caroline's heart surgery. I deeply appreciate
it. Today she had a slight fever from teething, but they plan
on operating tomorrow anyway.

Your response to my offer of Confederate general silver rounds
overwhelmed me, too. Y'all ordered about three times as many
as I had, so I had to buy more. There were too many e-mail orders
for us to type up and e-mail back to you today, but if you sent
an e-mail before noon today, we got it and have entered your
order. We'll send the trade confirmations tonight or tomorrow.
Silver rose 13.7 cents today, then more in the aftermarket, but
we'll still honour those prices in yesterday's newsletter for
the orders we are writing today.

Thanks very much. I'm sure y'all will be delighted when
you see them.

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 $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down.