Thursday, October 30, 2008

Keep Your Eyes On the Long Horizon - Good for Silver & Gold

Gold Price Close Today : 737.20
Change: -15.60 or -2.1%

Silver Price Close Today : 9.785
Change: -0.20 or -0.2%

Gold Silver Ratio: 75.34
Change: -1.437 or -1.9%

US Dollar Index Today: 84.82
Change: 0.27 or 0.3%

Don't let the last couple of days fool you: there's plenty of volatility left in all markets, and plenty of downside in stocks. Markets may go dead and dull in the next few days before the election, but since electing Barack the Self-Righteous or McCain the Warmaker cannot make one bit of difference, markets will resume their natural courses the day after.

The Dollar regained a bit today, but still is correcting. Remains to be seen whether it has reached the top of its upside correction, right now a 50/50 proposition.

SILVER and GOLD PRICES gave back a bit of yesterday's great gains, with gold taking the big hit down $15.60 to $737.20. Silver dropped only 2 cents to $9.785 cents.

More interesting was the 90%-coin premium dropping some 70 cents, from $3.50 to $2.80. That whispers that more silver supply is available than recent high premiums have suggested, and it won't take spot silver at $20.00 to draw it out. Rather, it will begin coming out around $11.50 - $12.00. Not a "bad" development, just another reminder to stay away from high-premium physical silver.

Still time to swap gold for silver. Yes, I would do that trade.

Keep your eyes on the long horizon. Colossal inflations of money & credit by Fed's & Treasury's attempts to "fix" financial crisis will inevitably cause colossal dollar inflation, if not hyperinflation. Bad for stocks, bad for dollars, euro, & yen, but good, good, good for silver & gold.

Worst specter we have on the horizon is the 15th of November meeting of heads of state and finance ministers in Washington for a "new Bretton Woods." Noises coming out of that event are full of globalism and more "Big Brother must watch you across borders because you are probably doing something you shouldn't be doing" talk. They could cook up something bad, really bad, even worse than Bretton Woods, and that is a real challenge.

No matter, let 'em rage. "The earth is the Lord's, and the fullness thereof."

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at:"

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.