Monday, September 29, 2008

The Bailout Bill WILL be Passed - Silver and Gold Prices will take a Whack, but that Won't Last Long

Gold Price Close Today : $888.20
Change: $5.30 or 0.6%

Silver Price Close Today : $12.981
Change: -47.8 or -3.6%

US Dollar Index Today: 77.87
Change: 0.15 or 0.2%

Events are moving faster and faster.

The Gold Price closes at 12:30 Central time, and closed today at $888.20, up $5.30, and the silver price closed at $12.9810, down 47.80 cents. (Always expect the Nice Government Men to attack the thinner markets first -- silver and platinum -- where they get a bigger bang for their manipulating buck.) The Dow had been bounding along just above 10,800. Then came news about 13:30 Central time that the House of (mis)Representatives wouldn't approve the bailout plan. Stocks collapsed, closing down 777.68 at 10,365.45, while silver and gold prices soared. At one point I believe I saw gold at 932, up 44 from the close, but it quickly settled back around $905, then rose in the aftermarket to $912. Silver jumped to $13.13.

And while all this was going on, I was frantically trying to return phone calls, along with everybody else in the office. The phone is ruthless, relentless -- you can't hang it up before it rings. Pick it up to call someone & there's somebody already waiting on the line.

Premiums are shooting up. US 90% silver coin, still the lowest cost form of silver, is trading today at 185 cents an ounce over spot; 100 oz. silver bars at 225 cents over spot, and silver American Eagles at 4.50 over spot.

The paper and the physicals markets are de-coupling, with no relief in sight. Tomorrow is a Jewish holiday which will make the market even tougher, since so many traders will be absent.

In the aftermarket the Dow in Gold Dollars dropped to G$235.08 (11.372 oz), just one gold cent off the last low in July. Through all this the US DOLLAR INDEX managed to close up 15.4 cents -- right, THAT'S a free market.

Friday WAMU was fed to JP Morgan. Monday Citibank was hungry, so the gummit fed Wachovia to them. Sharks are circling, and if you don't have friends in Washington, won't eat. The bailout bill WILL be passed. The charade taking place right now, even given the remote possibility of a few honest congressmen, is merely theater for the voters. Once it passes, stocks will jump up and silver and gold prices will take a whack, but that won't last long at all, and I doubt metals will fall far.

Buy silver, buy gold. Make certain you have no more than the FDIC insurance limit of $100,000 in any one bank. More turmoil is coming.

Yesterday was born Edmund FELIX Hawksley Sanders, son of my son Christian & his wife Eric, their second child and second son, and mine & Susan's eleventh grandson and twelfth grandchild. God is good above all we can think or ask or imagine. In the midst of the worst strife and trouble in the world, he keeps life going.

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.