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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:"
The-MoneyChanger.com

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.



Wednesday, October 29, 2008

A Leeetle Rate-Lowering Announcement From the Fed and the US Dollar Index Came A-Tumblin Down

Gold Price Close Today : 752.80
Change: 13.50 or 1.8%

Silver Price Close Today : 9.805
Change: 1.015 or 11.5%

Gold Silver Ratio: 76.78
Change: -7.330 or -8.7%

US Dollar Index Today: 84.50
Change: -1.72 or -2.0%

My, O, my, all it took was a leeetle rate-lowering announcement from the Fed & the US Dollar Index came a-tumblin' down. Dropped 172.4 basis points today, another 100 bp yesterday, who knows what she'll do tomorrow.

We remember the proverb, "What goeth straight up soon goeth straight down." Dollar must be acting in accord with its true fundamentals, which are the same as a drowning man floating in the Pacific Ocean wearing a steel helmet and having 200 lb. anvils tied to each foot.

Yet another example of the straight-up-straight-down was displayed in the stock market today. Opened up 2.79, rose 298.2 points, yet closed down 83.63, losing a total of 381.83 points, although up & down. Here, I suspect, we have an example of why you have to keep your head trading & stifle your emotions. Fed announced a rate cut, the unsophisticates reacted by buying with both hands, the sophisticates waited until newbies had hung themselves out to dry, then sold into their naïve hands, all the way down.

Reminds me of another proverb my friend Barry P., world's most disciplined trader (well, nearly) taught me: "In a bear market, money returns to its rightful owner." Oh, and once last proverb, also fitting, from Barry P.:"The market is not benevolent." Believe it or not, I have those proverbs right on my wall where I see them every day. It helps my humility problem. And so reminds me not to toot my own horn when I have a day where I hit the market EXACTLY on the head & begin to think I am pretty smart, before being market-smacked again.

The SILVER PRICE did indeed turn around yesterday, and today added -- hear this! -- $1.015! Closed at $9.805! Not to be outdone, the GOLD PRICE closed at $752.80, up $13.50, but gold was in fact outdone because the Gold/Silver ratio dropped to 76.79. Most likely course from here is a little drop-back, then a run higher.

Here are some gold numbers to watch, barriers or milestones upside: 1st target is $786, last low; then $800.61, 17 day moving average; then $828, August low & September correction low; then the 300 DMA at $850. Of course, $850 is The Big Number on its own, the 25 year resistance and top of the 1980 bull market.

The silver price milestones to watch: $10.50 first. That marked lows in August, September, & October (till it broke). Next comes $11.7, the August 2007 [sic] low; $12.46, the 50 DMA, & at last $13.50-70, the September high.

The Dow in Silver Ounces dropped 136.73 oz today! Remember as you watch this run that a high probability remains that after a run-up that makes everybody grin, a correction will come. That is the one we have to watch, because as long as it holds above yesterday's low, the silver price has bottomed.

In 1929 this day became Black Tuesday as prices collapsed on the New York Stock Exchange, wiping out thousands of investors. What is it the French say? "The more this changes, the more it stays the same."

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at:"
The-MoneyChanger.com

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.



Tuesday, October 28, 2008

Gold and Silver Prices Have Now Bottomed

Gold Price Close Today : 739.30
Change: 2.40 or -0.3%

Silver Price Close Today : 8.79
Change: -40.5 cents or -4.4%

Gold Silver Ratio: 84.11
Change: 3.444 or 4.3%

US Dollar Index Today: 86.31
Change: -0.96 or -1.1%

Bonjour, artistes! Yet another lovely day of "painting the tape."

Behold! The SILVER PRICE made a new low at -- gasp! -- $8.46, but of course, that was painting for the public. You and I mere mortals couldn't buy it there. After a spike low to $8.45, then a nice, picturesque close down 40.5¢ at $8.79,and Whoops! Aftermarket jumps 41¢ to $9.20.

If that after market had been a close, it would have laid down the first two pieces of a Key reversal, a break into lower ground followed by a higher close. I'm willing to count it as that, provided it closes higher tomorrow. Me, I bought silver today.

Gold's trading today was just as bogus as silver's. It made a "low" at $728, then "closed" (wink! Wink!) at $739.30, down $2.40, but in the aftermarket is now trading at $748.90, up $9.60 My, my, what a pretty picture!

The US DOLLAR INDEX flopped 96 basis points today, on scuttlebutt (no doubt scuttled by the Fed . . . er, never mind, the Fed itself) that the Fed intends next week to slash interest rates to stimulate more borrowing. Since interest rates are the prime determinant of currency exchange rates, announcing you are lowering interest rates to 4 years lows wouldn't really boost the dollar, now would it?

I warned y'all before about mad-dog volatility, & now we have it. Dollar up 120 bp one day, down 100 the next, and the stock market up 889 today to 9065.12. Mercy, you'd have thought it went to 20 thousand they way the Wall St. shills crowed. Lo, beware the bear market rally, sudden, sharp, strong --- and short. More downside to stocks yet, much more.

Seems to me that gold and silver prices have now bottomed, but in a market this volatile, keep your powder dry.

Here's something odd. Friend told me today he went to a big convention of (ought to be) smart people last week, and not a single person seemed at all concerned about the financial crisis. Well, no real surprise, since they have been brainwashed by public education, government, & media to trust their "leaders" to take care of them. Course, they may belch & swallow hard when they see those IRAs & pension accounts down 30 - 40%.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at:"
The-MoneyChanger.com

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.



Monday, October 27, 2008

Confirmation is Needed, but it Now Appears that Silver and Gold Prices Have Made an Important Bottom

Gold Price Close Today : 741.70
Change: 12.60 or 1.7%

Silver Price Close Today : 9.195
Change: -10 cents or -1.1%

Gold Silver Ratio: 80.66
Change: 2.223 or 2.8%

US Dollar Index Today: 86.94
Change: 0.58 or 0.7%

On Friday I meant to mention but omitted that the gold price rose even in the teeth of a 120 basis point rise in the dollar.

From Friday we were looking for the finishing component of a key reversal in the gold price, namely, a higher close today. We got it: the gold price closed up $12.60 at US$741.70. However, the silver price closed down 10 cents at $9.195. However, gold weakened off in the aftermarket, but only to about $733. Again, the gold price rose in the teeth of the US DOLLAR INDEX rising 58 basis points today to close at 86.935.

Obviously confirmation is needed, but it now appears that silver and gold prices have made an important bottom. Premiums are still crazy high, deliveries are 3 weeks to 16 weeks, so silver and gold markets remain under fierce buying pressure.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at:"
The-MoneyChanger.com

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.



Friday, October 24, 2008

I Would Be Buying Gold and Silver Right Now - Before the US Hyperinflation is Over, You'll Be Glad You Did

Gold Price Close Today : 729.10
Change: -15.80 or 2.2%

Silver Price Close Today : 9.295
Change: -20.5 cents or -2.2%

Gold Silver Ratio: 78.44
Change: 3.356 or 4.5%

US Dollar Index Today: 86.46
Change: 1.56 or 1.8%

Okay, so here's yet another week like you've never seen before, & probably never will again -- yet with changes. I have what may be momentous news, but more of that later.

Like Dagon of old, the god of this world -- the state -- keeps falling on its face. Despite the best efforts of Olympus/Washington, the stock market keeps on falling, and right now at least, nobody much believes it will ever rise again, at least for now. Stock markets overseas are taking the failure of their god very hard -- Euro markets dropped 10-1/2% today, I heard.

STOCKS have not finished crashing yet -- crashes run six to eight weeks, and this one only started at September's close. Oh, my, once 8000 gives way, the waterfall will begin. This could reach all the way into the 6000s [sic].

The US DOLLAR INDEX rose today 155 basis points to 86.46. It will probably go higher, but remember that markets that go straight up also come straight back down. Not much telling how high it will go logically, but around 87.75 it will begin hitting heavy resistance. Will that be enough to stop the panic into dollars? Who knows, but this won't last forever, & when the panic ends, gravity will take over.

The GOLD PRICE may have bottomed today. Right. Here's the evidence from today. Early today (9:30 EDT) it traded to a new low for the move, $691.85. From that bottom the daily chart does not "recover", it exploded, gapping up through $700 all the way to $712. More, the few trades at the low occurred after a small gap down, leaving an island reversal. Then the gold price closed at US$729.10, up 15.80. Setting aside the gap & island reversal, the break to a new low with higher close fulfills two of the three marks of a key reversal. Only missing ingredient is a higher close the next trading day, which must come on Monday. On top of this, gold's low this week could be a double bottom with the 11 September low at $744.10 (or it could be the head in a reverse head & shoulders bottom.)

Add to gold's performance silver's antics this week. The Gold/silver ratio turned down and dropped sharply( Down -5.89 or -7.0% from 84.33 on the 17th of October to 78.44 today), an encouraging sign. Then the silver price rose on days when gold sold off. That pattern changed today, when the silver price actually dropped in the face of gold's rise, but caught near the last low ($9.31 on 17 October). Remember also that in June 2006 the low off the spring 2006 high was $9.595 not far from this week's lows.

So we have a possible key reversal in the gold price (watch Monday's close for final confirmation) & a possible double bottom in the silver price. This is a clearer, and better, technical picture than we've had in three weeks.

Physical gold prices have still de-coupled from paper (futures) gold prices, a suspicious circumstance that smells like the stink of the Nice Government Men manipulating prices. The paper silver price closed today at $9.295, but physical silver at wholesale one ounce silver rounds cost $11.53, while US 90% silver coin cost $13.938 an ounce. The only silver we can get is US 90%, silver rounds, and thousand ounce silver bars.

Decoupling has occurred in gold as well. With the paper gold price at $729.10, the only forms of physical we can find are Mexican 50 pesos, Austrian 100 coronas, British sovereigns, French 20 francs, & one ounce .9999 gold bars, and most of those are on 8-12 week delivery. If you want to wait 12 weeks, you can buy physical gold for $756.70 (as 1 oz bars or Mex 50s). If you want immediate delivery (as sovereigns) you'd pay US$816.69 at wholesale. Forget getting American Eagles at any price until next year.

So while the crisis tornado appears to be gaining speed for stocks, silver and gold prices may (I stress "may") have bottomed this week. Bottomed or not, I would be buying gold and silver right now. Before the US hyperinflation is over, you'll be glad you did.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Thursday, October 23, 2008

If Today Wasn't a Bottom in Silver and Gold Prices, I Have no Idea Where They Will Bottom -- $6 and US$600? Who Knows?

Gold Price Close Today : 713.30
Change: -20.00 or -2.7%

Silver Price Close Today : 9.5
Change: 4.8 cents or -0.5%

Gold Silver Ratio: 75.08
Change: -2.497 or -3.2%

US Dollar Index Today: 85.22
Change: -0.39 or 1.1%

Yes, yes, I know that I have been urging y'all to buy silver and gold since this monstrous decline started, but I have been neither as crazy or as wrong as I looked. Deliveries for physical silver & gold have now stretched out to ten (10) weeks for what we can get. For 100 oz. silver bars, silver American Eagles, gold American Eagles -- well, you'll be lucky to get any of that by late February or March. So if you bought earlier, you paid more, but you have it by now, or are close to having it.

If today wasn't a bottom in silver & gold prices, I have no idea where they will bottom -- $6 & US$600? Who knows? I don't take any price at face value any longer, don't trust the integrity of any market, so all I can do is use rational & charting guidelines as a guess and go with it. If that turns out wrong, well, we took a long shot in the dark. Better than standing stupified in the dark waiting to be et by a monster.

US DOLLAR INDEX faltered today, dropping 38 basis points to 85.216. It has been moving straight up, & I remind y'all that nothing rises straight up for long, except those helium balloons you bought at the fair when you were a kid, & even those didn't make it to the moon, regardless what your mom told you when you turned loose of yours.

The Gold Price today closed down $20 at US$713.30 and the silver price up 4.80 at 950, an odd non-confirmation. In the after-market the silver price rose nearly 20 cents and the gold price about 9 bucks.

Smile, & keep your powder dry. Ordinary life will return.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Wednesday, October 22, 2008

The Gold Price Could Be Breaking Down Below its Last Low for a New Fall Or it Could Be Making a Double Bottom

Gold Price Close Today : 733.30
Change: -32.80 or -4.3%

Silver Price Close Today : 9.452
Change: -59.8 cents or -6.0%

US Dollar Index Today: 85.39
Change: 0.96 or 1.1%

All the magic cures the Fed & the US treasury have applied have yet to work their magic, as stocks continue to droop. The US Dollar index perked up again today, rising nearly 100 basis points at close to 85.40 and another 22 basis points in the aftermarket. Stocks closed at 8,519.21 (basis the DJIA), a new low for the move. No support much lies between here & the Oct. 2002 low at 7,286.27.

Clearly, all that wasn't good news for gold. It closed down 32.80 at US$733.30, while silver dropped 59.80 cents to close at 945.20 cents. Markets are at a point of panic & turmoil that charts hardly help. My 200 day moving averages, which are supposed to smooth out daily price fluctuations, actually show vibrations -- zig-zags.

Let's do "bad news-good news."

The bad news is that silver today dropped nearly to its last low at $9.31, and that $10.50, which had been the line in the sand, gave way. Gold also closed today at $733.30, marginally below the 11 September low at $741.30. Those could be breakdowns that would carry -- where? Pick a number, any number, but lots lower.

The good news is that the Gold/Silver Ratio has turned down, dropping from its high of 82.349 last Friday to 77.581 today. Gold's low today can be parsed in two ways. First, it could be breaking down below its last low for a new fall. Second, it could be making a double bottom -- a close 1.1% below previous low close certainly lies within that range. In fact, it could reach all the way to 3% ($721.97) & remain in the running for a double bottom.

Finally we know that paroxysms -- panics -- don't last long, 6-8 weeks at most. They simply exhaust themselves and everyone else. Figuring this stock market panic began about end-September, it ought to have blown itself out by end-November. Yeah, I know -- that's pretty cold comfort.

I had a long conversation with someone this afternoon who asked the heartbreaking question, "Is everything that we think has value going to disappear?" No, no, the things that cannot be shaken won't disappear, but the phoney values are disappearing, & will disappear, & you'd better be ready for it.

Awww, pie in the sky, Moneychanger! What about silver & gold? Will they come back? Talk straight. Well, I was talking straight, but the same applies here. When all is bewilderment, you have but one choice: return to first principles. Check the foundation. Inflation is an increase in the money supply. Can the Nice Government Men & the Fed pump $2 trillion in new credit into banks & money supply, and inflation not occur? Can the Federal government take on $5 more trillion in the debt of Fannie & Freddy & inflation not occur? Have they bailed out everybody but the local deli, without creating more money? No. And not one stroke of this government intervention will help the economy; it will only prolong & worsen the depression. However, it will create an intense inflation or hyperinflation, which guarantees that silver & gold will return with a vengeance.

These are the days that will separate phoney "wealth" from real wealth, the bogus piling up of electrons & numbers versus real wealth that produces something. I'm staying with silver & gold, but then, I've got milch cows & pigs & goats & sheep, too.

I finished by telling my friend that I feel like I am driving down a dark road in a driving rain at 80 mph. I can't see one thing in front of me & can't slow down, but someone utterly trustworthy, someone who has driven this road before told me that it is straight. If I just don't swerve or turn, if I just keep driving straight, I can stay on the road & reach home safely. I have to trust that. Outside is only leering darkness & howling silence.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Tuesday, October 21, 2008

Silver Price Strength Hints that the Gold Price May be Ready to Turn Around

Gold Price Close Today : 766.10
Change: -21.50 or -2.7%

Silver Price Close Today : 10.050
Change: 38.5 cents or 4.0%

US Dollar Index Today: 84.27
Change: 1.20 or 1.4%

Sorry I missed y'all yesterday, but I woke up with a stomach virus that canceled all my plans and my consciousness for 24 hours. Amazing how certain we are about the plans we lay, and what a vanishingly small thing (a micro-organism) can demolish all those plans. What's the lesson? We are not in charge.

Biggest news I saw today was the rise in the US DOLLAR INDEX by 120 basis points to 84.27. My take on that? Dollar has corrected slightly and is beginning to rise again, but not for long. Expect the dollar to run out of gas between 85 and 87.5 a most.

Looking at the Dow and how it faints every time it tries to raise its head, I am glad I am not the Nice Government Man "tasked" with manipulating the stock market. What a rotten job. Get out of stocks, get out of US dollars and investments that promise to pay dollars in the future.

Today the silver price rose 38.5 cents to 10.05 while the gold price fell 21.50 to 766.10. At least, that's what happened in the paper market. In the physical market the silver price (as measured by US 90% silver coin) rose from 14.385 yesterday to 14.888 today. Or, as measured by one ounce silver rounds, the silver price rose from $11.99 yesterday to $12.49 today.

The paper gold price today fell $21.50 to $766.10. The physical gold price dropped from $850.25 (basis Krugerrands at wholesale) to $831.60 (basis Krugerrands). Right, that's 65 bucks above the paper gold price.

Frankly, it's tough even to guess what's going on. The gold price may drop to its previous low, say, $740, but who knows? The strong fall today in the Gold/Silver ratio, from 81.7 on Monday to 75.7 today, showed great silver strength, and hints (I said "hints") that gold may be ready to turn around as well. Intriguing, isn't it, that on the day when the dollar index rises 120 basis points, gold takes a $21.60 hit while the silver price rises? Add that to the long list of "Things That Don't Make Sense" in these mysterious markets.

Ninety-eight years ago today, on 21 October 1910 my father was born, into a world little changed since the 12th century, but Oh, how the 20th century changed everything. Thing I remember most about my father is that he was always ready to laugh, & he knew everybody in the world. If we went out to eat at some restaurant in a city we'd never visited before, I can promise you he'd find somebody there he knew. R.i.p.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Friday, October 17, 2008

The Link Betweeen Paper (futures) Silver and Gold Prices and the Physical Prices is Stretching Thinner and Thinner

Gold Price Close Today : 785.10
Change: -16.40 or -2.0%

Silver Price Close Today : 9.31
Change: -29.7 cents or -3.1%

US Dollar Index Today: 82.40
Change: -0.01 or -0.0%

Well, well, here's a surprise: another week you'll never see again in your life -- oddly enough, something like the week before.

If you think you're going to make any sense out of these market gyrations, you've lost your mind. Stocks are lurching from side to side based on manic fear or euphoria, a pure crowd phenomenon pushed from side to side by the Nice Government Men on the Plunge Protection Team. Life today resembles that scene in the Wizard of Oz, where the bogus wizard is pulling levers and blowing smoke from behind the curtain in the throne room. Dorothy and her friends are terrified by the wizard's projection, until her little dog Toto pulls back the curtain to expose the wizard's deception. "Pay no attention to the man behind the curtain!" screams the Wizard into the microphone.

So daily our Masters trot out some other Wizard blown up bigger than life on the media's silver screen -- Buffett, Bush, Paulson, Volcker, Donald Duck -- to keep urging the public to "pay no attention to the men behind the curtain."

As I've said so long, they have only two weapons, Inflation and Blarney. They've fired off the inflation cannon until the barrel has almost melted, so now they're working the blarney cannon overtime.

Let us therefore try to slice through this deception to the truth. The deflation scare stores are beginning to fly, which must tickle Ben Bernanke to death. Not to put too subtle a point on it, there's as much chance of a US Dollar deflation as there is of me marrying the Pope. It's not possible that the US Government and the Fed could pump US$2 trillion into the credit and financial system without producing inflation.

The dollar's days are numbered. Therefore, after the Nice Government Men get tired of kicking silver and gold in the teeth, they will begin their inexorable, ineluctable, inevitable, yea, fated drive for the moon, and the US Dollar will again begin sinking toward the center of the earth, which already holds all the missing rubber bands and paper clips and bobby pins.

US DOLLAR today, in the midst of history's worst financial panic, was flat. Odd, ain't that? Wouldn't you think that fear would send folks running for safety to US Dollars? Well, it isn't. So if the dollar rally is turning ratty already at 82.4, what will it look like in a couple of weeks when the other central banks stop supporting the dollar? Yes! You there in the front row! Right. The dollar will look like an anvil floating serenely upon the ocean waves.

Stocks, for all their 900 point up days and 800 point down days, closed the week higher in dollar terms. In gold terms, the Dow In Gold Dollars, stocks remain at their lows of last spring, and in silver only at 963 oz, about the high since silver peaked in March.

Wheeee! SILVER and GOLD PRICES took yet another tumble today. I think I'm going to start reporting the Paper (futures)silver and gold prices and the Physical silver and gold prices separately, because the link between them is stretching thinner and thinner. For example, Paper silver price dropped today 29.7 cents to 931 cents, while Physical silver price, as measured by the wholesale sell price of US90% silver coin, went from 1383.2 cents yesterday to 1415 cents today. Or Physical silver as measured by miscellaneous 99.9% silver rounds, went from 1183 cents in yesterday's aftermarket to 1175 in today's.

Oh, yes, and Silver an gold American Eagles? Well, not available at any price! From day to day I don't know whether I'll be out of business for want of anything to buy, but sure, sure, silver and gold dropped today.

Over the next couple of weeks look for a short, sharp rally in stocks, offering a sterling opportunity to sell stocks and shift the proceeds to silver and gold. However, bottom in stocks hasn't been see yet, and will probably dip below 7250. After several months the inflation will begin flowing into stocks and raise them again, but of course values that don't rise as fast as the dollar falls really aren't too useful as investments.

Just hang with silver and gold. You can either buy now, because the risk of more seismic events remains so high and you want to own some gold and silver at all hazards, or you can play brave and wait for a bottom confirmed. At this juncture of knaves in charge and fools in power, I'd rather "take the cash [gold and silver] and let the credit go."

What about the gold/silver ratio? It has risen up to the last high, and slightly higher, but probably won't rise from here. Unfortunately, swaps from gold to silver (due to high premiums on silver) can't get close to the current 82.75. Best we can do, even charging commission on one side only, is about 70:1.

Am I lying awake nights worrying about silver? Hardly. Regardless what the ratio does now, it will drop again and overtake gold handsomely.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Thursday, October 16, 2008

Don't Get Whacked by the Deflation Red Herring - Financial History's Biggest Sucker Punch

Gold Price Close Today : 805.30
Change: -30.20 or -3.6%

Silver Price Close Today : 9.660
Change: -48.2 cents or -4.8%

US Dollar Index Today: 82.41
Change: -0.04 or -0.1%

How do you spell R-E-L-I-E-F? "Government money." Well, I'll be switched, just switched. I am just so surprised I may never be able to get my jaw up & my mouth shut again. The Almighty Yankee Gummint announces a plan to buy shares in banks (read: give more money to favourites) and at the top of the list stands Bank of America, Citigroup, JP Morgan Chase, and Morgan Stanley. Oh, sure, sure, the "little" banks will also participate, but later, not right now.

And here's another odd note: in the midst of a world-wide financial meltdown the US Dollar can't seem to make much headway, closing today at 82.40, down 4 basis points. Altho it's only one day, one still has to wonder how much "deflation" that foretells. The articles screaming about "deflation" are already appearing, which saves the Fed and the Nice Government Men a lot of propaganda money. Fed's job, of course, is not to manage inflation but inflation expectations (thank you, Steve Saville). Nothing like a flurry of media-hype about the dangers of deflation to keep the public barking up the wrong tree.

People keep asking me, and I keep telling 'em, and will keep telling 'em, Look -- the government has just injected a couple of trillion bucks in credit & cash. How much deflation does that promise? Zero, maybe, less than zero, since all that will be added to the money supply after being created out of thin air. Is it possible that collapsing debt & derivatives could overwhelm the central banks' inflation cannon? Sure, but it's very unlikely. Go look at the G7 meeting's agreed upon points and tell me how many are deflationary. None, it's an agreement not to pump but to inundate with a tidal wave of liquidity. Yes, it hurts to see these silver and gold prices, to see the gold/silver ratio at a new high, to wonder (hand me that waste-basket, I need to puke again) whether this will all work out as I expect, but it would hurt worse to be whacked by financial history's biggest sucker punch. That's what I believe the deflation red herring is right now.

The paper silver price dropped 48.2 cents today to close at a new low, 966 cents, which gold fell 30.20 to stop at US$805.30. If (as a friend reminded me today) I tore the top off the chart and looked at silver and gold, I would be dismayed. However, two considerations stop my dismay. First, I believe the US government, and every other government and central bank, is intervening in the silver and gold markets to cap prices. Now don't even bother to wave your snide "conspiracy" remarks my way, because since 1934in the Gold Reserve Act the NGM have had a secret slush fund call the Exchange Stabilization Fund created for the explicit purpose of manipulating the gold price and currency exchange rates. Second, what would you hold in preference to silver and gold? US Dollars? Stocks? Euros? Yen? The only thing I would want to own is productive assets, a farm, a business, a manufactory, something capable of producing a stream of revenue.

So I come back in a circle to gold and silver. I'll just have to keep on buying it, whether the silver price drops to $8 and the gold price to $720.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Wednesday, October 15, 2008

In the Not Distant Future Paper Currencies Will Become Laughable Shadows of Their Former Selves

Gold Price Close Today : 836.30
Change: -1.40 or -0.2%

Silver Price Close Today : 10.142
Change: -88 cents

US Dollar Index Today: 82.32
Change: 0.78 or 1.0%

What do you say about a market that gains 900 points one day, then day after next loses 733? Can anyone spell "N-i-c-e G-o-v-e-r-n-m-e-n-t M-e-n"? Or you could just ascribe it to an countertrend rally in a bear market. Either way, you'd probably be right. Take any opportunity to get out of stocks, including IRAs & 401(k)s. If you can't bear the thought of paying the tax penalty, then at least convert them to silver or gold IRAs. Call Gold Star Trust (800/486-6888) or Sterling Trust (800/955-3434) & ask about transferring your IRA to them & converting to a precious metals IRA.

Then there is the almighty -- or should I say, slightly mighty -- US DOLLAR index. It closed today up 78 basis points at 82.317, but looks ready for a correction. Of course, how can one read markets technically when so many "invisible hands" are stirring the pot.

I hear on National Proletarian Radio this morning (in between the begging for money) that the announced government buy-in to banks would affect six banks. That sort of surprised me, but I was so covered up today I never got a chance to look it up. Did any of y'all see? "Surprised"? Did I say that? A wholesale revolution has taken place in which the US government is being taken over by the banks, & the government is throwing Bodacious Bailout Bucks not only at the whiners, but at anybody who even looks sad.

But let's leave all that and move to silver and gold. What a farce, what a show was today's market. Most all the day silver remains in 10.30 - 10.40 range, then "mysteriously" collapses at the close to close down 88 cents at 10.14. Whoops! But of course when you try to BUY anything at that 10.14 price, it shoots up in the aftermarket 35 cents and now is trading at 10.43. The gold price followed the same pattern, trading most of the day around $845-$850, then "suddenly" dropping to close at 836.30. Whoops! Immediately in the aftermarket it rose back to 850.

Ladies and gentlemen, 'twas not always thus. Get out of US dollars, out of Yen, out of Euros, out of all fiat currencies and into silver and gold. Gird up your loins for extreme volatility, for NGM raids on silver and gold prices to drive them down temporarily, or on stocks to raise them up, and keep your eyes on the horizon, where surely in the not distant future paper currencies will become laughable shadows of their former selves.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Tuesday, October 14, 2008

After All this Bewildering Turmoil is Over, Silver and Gold Will be Standing Tall

Gold Price Close Today : 839.00
Change: -3 or -0.4%

Silver Price Close Today : 11.060
Change: 27 cents or 2.5%

US Dollar Index Today: 81.56
Change: 0.14 or 0.2%

The silver and gold markets are becoming more and more like something that crawled out of Salvador Dali's mind -- surreal. Futures market price ("paper price") goes one way, physicals ("real") silver and gold price goes the other, namely, up, up, up. After all this bewildering turmoil is over, silver and gold will be standing tall.

Right now the most attractive buy, and the one we can get hold of quickest, is one troy ounce .999 fine silver rounds, privately minted coins.

To order 1 ounce silver rounds please call (888) 218-9226 and mention goldprice.org when you call.


In gold we can get quickly Austrian Philharmonics, British sovereigns, and French 20 francs. Frankly, right now I am reaching for quick delivery over price.

All markets are becoming more and more surreal as government increases participation. It already controls the entire mortgage market, now announced this weekend it will buy shares in banks. Shoot, we're ALL gonna get rich! Just like we can all fly -- it's easy. Just get you a tub with two handles, and grab one handle in each hand, and pull yourself right up into the air.

God, have mercy on us! Government intervention will stretch out what might have been a one-year long panic into a 15 or 20 year Great Depression II, a hyperinflationary nightmare. Strange, how few people have caught on so far. They think they can just keep on doing the same old things, but wait. Excuse me, I gotta go accomplish something: I'm going to go bush-hog.

The words were hardly out of my mouth warning you about the finance ministers' meeting cooking up some sort of changes in the international "financial architecture" than Dominique Strauss-Levy (unless you are from a Spanish speaking country, double names ought to be outlawed under a death sentence for bad taste) director and head hanch-ette of the IMF made a speech calling for same and gushing about how this time around (as opposed to the Great Depression) governments are free from Old orthodoxies" that kept them from spending gad-zillions of taxpayer money to bail out banks & other buddies.

Look at Dominique's speech at www.imf.org/external/am/2008/speeches/pr02e.pdf
if you have recently taken a strong anti-emetic. You get used to this New World Order clowns using "code phrases" like "sea change" and "financial architecture." You have to torture yourself by reading hundreds of pages of their eye-numbing documents to fish out what they mean, in this case, one world control of the world's financial structure.

If any of y'all believe that yesterday's big rally in the Dow marked the end of the stock bear market, give me a call about shares in the Brooklyn Bridge. Stay out of stocks, sell the ones you have on any rally, and put proceeds into silver and gold.

The US DOLLAR INDEX fell today, and hasn't managed to breach 82. Dollar strength will not last long, so enjoy it while you can. Use it to sell all investments that promise to pay future dollars: annuities, certificates of deposits, savings and checking deposits, bonds, life insurance.


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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Friday, October 10, 2008

What Had You Rather Hold Now than Silver and Gold? Dollars? Euros? Bank deposits?

Gold Price Close Today : 855.40
Change: -27.70 or -3.1%

Silver Price Close Today : 10.545
Change: 12.75 cents or -10.8%

US Dollar Index Today: 82.55
Change: 1.51 or 1.9%

Remember this day, because you will probably never see another like it. Today was everybody's turn to puke in his wastebasket.

If you're sick about your silver and gold prices dropping, since last Friday the Dow lost 18.26% & the S&P500 lost 21.6%. Compared to that, the 6.4% drop in the silver price looks like nothing, and the gold price actually rose 3.2% from last Friday until today.

Unquestionably, much of today's decline was grounded in a frantic run to safety and cash. A collapse feeds on margin calls real or expected, & the need to raise cash no doubt helped press silver & gold down. That said, the rest of the day was nothing but the Nice Government Men "painting the tape." This morning a little before 9:00 Central time Susan and I were listening to National Proletarian Radio and the announcer called the Dow at "Down 170", then 30 seconds later, "Down 260", then in another 30 seconds, "Down 420." Looking at the day's chart, the Dow climbed back up very, very quickly to unchanged, then fell back. By 14:00 it was back on the lows of the day, but -- miracle of miracles! -- the Dow visited Lourdes beginning at 15:00 and rose again from the dead, to finish the day down only 175. Only thing I can figure out is that all those panicked investors had their nerves soothed by George Bush's masterful broadcast address.

Then we come to silver and gold prices, which climbed or held steady throughout the day until the clock struck noon. Suddenly, worldwide, investors who had been fleeing into gold suddenly changed their minds (!!) and fled out of gold, leaving it down 27.70 at Comex close (12:25) at $855.40, and poor silver down 127.5 cents at $10.545. During the day it actually traded as low as $9.30, but by now (17:13 Central) has climbed back to $10.12.

What you saw today is simply not normal trading, and you can't say anything about it except, "Panic." Where it will sort out I can't say, but I am certain that when it sorts out, silver and gold prices will resume their upward drive. If they were good buys earlier this week at 906 and 12.30, what are they now? The inflation will come, the US government has staged a coup d'etat, taking over direction of the economy. The dollar will suffer, as will every other fiat currency.

Besides, ask yourself this: what had you rather hold now than silver and gold? Dollars? Euros? Bank deposits? Right. I'll stick with the silver and gold.

Don't be surprised if some proposal comes out of the G7 finance ministers' meeting for a "new international financial architecture." Or for more power to the UN, or for a closer merger of the North American Union. This is what the elite longs for, more power over your life & mine, O fellow mushrooms.

All that doesn't matter. Silver and gold prices will rise and keep rising. Don't be distracted by the old woman with the crooked nose selling apples at your front door while they're loading your furniture out the back door. And in the near future here's a never-fail test for whether or not your government officials are lying: Are their lips moving? If so, they are lying.

One more thing, Mushrooms: one day our turn will come, and it might not be long. "Our turn" means a chance to build a new monetary system on silver and gold, and a chance to build a just and stable economy. Look around you, at your local economy, because that's the place to start. Do any local stores or tradesmen or restaurants accept silver and gold in payment? Why don't you suggest it to them? You never know until you ask.

Edward J. Kane said, "Historically, bankers have tried to portray themselves as leaders and tribal priests, and the banks have been built on the model of temples.
I don see any reason to believe bankers are any worse or any better than anyone else. But because they operate with a special product -- money -- there's more temptation."
But I like better the wisdom and courage of my fellow Tennessean, Andrew Jackson, who said, "The Bank is trying to kill me, but I will kill it." Where's Andy Jackson when you need him?

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"
The-MoneyChanger.com

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.



Thursday, October 09, 2008

If Ever a Weekend Offered Fair Promise for Declaring a Bank Holiday, it's this One

Gold Price Close Today : 883.10
Change: -20.0 or -2.2%

Silver Price Close Today : 11.820
Change: 10.3 cents or 0.9%

US Dollar Index Today: 81.40
Change: 1.22 or 1.5%

Confusion and shame-of-face run wild as bad news stories pour in too fast to digest them all: US Fed lowers interest rates, followed by Europeans, then South Korea, Hong Kong, and Taiwan. Icelandic government nationalizes the nation's biggest Lender. US government rumbles about buying "stakes" (read: "nationalizing") banks. Stock markets crash around the world while Japanese yen drops 2.5%, G7 finance ministers and central bank "heads" meet tomorrow in Washington for 2 days.

That enough excitement for y'all?

Today the US DOLLAR INDEX reversed course, jumping up 122 basis points to close at 81.40. Next move will probably be up as international financial panic sends people running to dollars for safety. Wow. Think about that -- but not for long, unless you want to go crazy.

Dow Jones Industrial Average closed down 678.91 at 8,579.19, having plunged through every support level except the 9 Oct. 02 low at 7,286. Now y'all see why I wanted y'all to sell stocks. Now at some point this crash will reverse, and sharply, for at least a bounce.

If ever a weekend offered fair promise for declaring a bank holiday, it's this one. First, the G7 finance "ministers" are meeting in Washington, no doubt to talk about "restructuring the international financial architecture", which our masters have long longed to do. Second, it's a long holiday weekend, and the yankee government always likes to throw its surprise parties on weekends, when nobody can do anything to protect himself. Third, they haven't staunched the bleeding in the system yet. Listen, I am not predicting they'll declare a bank holiday, but it's a possibility, so pick up some extra cash tomorrow, like, a couple of month's living expenses.

STOCKS have been worse devastated in terms of silver and gold than they have in dollar terms. The Dow in Gold Dollars (DiG$) five days ago stood above the last (G$235) low at G$257.50 (14.457 oz). Today it closed at G$200.82 (10.321 oz), down 22% in 5 days. In fact, in the aftermarket the DiG$ stands at G$194.69 (9.418 oz). Dow in Silver has fallen to 700.91 oz., a new low.

SILVER and GOLD PRICES
were another play in impossibility today. Gold actually closed down 20 at $883.10 on the Comex futures market, and the silver price closed up 10.30 at $11.82. Hogwash, I don't believe those prices any longer. In the aftermarket as stocks melted like Christmas candles too close to the roaring fire, silver and gold relentlessly climbed, at one point reaching $928 and $12.80 [sic]. So, what's the real price? Blamed if I know. It's whatever a willing buyer and a willing seller agree on, and it's moving ever higher.

Deliveries on silver and gold continue to stretch out. I was able to buy a few gold French 20 francs today at a modest $19 each over melt, if I don't mind waiting two weeks for them to fly from Europe. Believe it or not, those looked like a fancy bargain, compared to waiting 4 - 16 weeks for everything else.

Worst thing I see now is people locking up, unable to make a decision and move. Time for that is over. You better get out of stocks and anything that pays dollar -- annuities, certificates of deposit, bank deposits, bonds -- as quick as you can, get into silver and gold, and never look back.

I understand how easily our hearts faint and panic in a sea of bad news, but my own was quieted this morning by Psalm 46:

"God is our hope & strength, a very present help in trouble.
"Therefore we will not fear, though the earth be moved,
"and though the hills be carried into the midst of the sea:
"Though the waters thereof rage & swell, &
"though the mountains shake at the tempest of the same."

Tomorrow our office will be closed to give us a chance to untangle paperwork. Monday, 13 October, is a holiday, Columbus Day, and markets will be closed. We will return to the office on Tuesday, October 14.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Wednesday, October 08, 2008

The Door Into Physical Silver and Gold is Very Small, and Won't Accommodate Panicked Crowds

Gold Price Close Today : 903.10
Change: 24.70 or 2.8%

Silver Price Close Today : 11.717
Change: 39.2 cents or 3.5%

US Dollar Index Today: 80.82
Change: -0.22 or -0.3%

This office feels like a war zone. How can you sell or buy physical silver and gold when you can't even trust the spot gold and silver prices you see on a screen? People promise they can ship, then, through no fault of their own, can't. Customers who've ordered are nervous (not to mention me) and some who haven't ordered seem just to give up. Nerves are frayed throughout the physical metals market, not just ours.

In a stable, slow moving market, it makes sense to buy the lowest priced item relative to spot gold or silver prices, because over time in a bull market, premium always disappears. However, this market left off normality two months ago. Premiums may be sky high, but it's time to consider them from the standpoint of absolute price. Premiums may be high, but prices as a whole are low now compared to a year from now. It all boils down to this: if you want to play, you got to pay.

And you can't be picky about what you get. I've sold things in the last week I have seldom sold in the last 28 years, such as thousand ounce silver bars or non-Comex approved silver bars, but those were the only silver that I could get shipped within a week or two. If you want to play, you got to pay.

Most of all, be wary of charlatans who promise the impossible. They won't be able to perform. And always remember that if a deal sounds too good to be true, it is. These outrageous market conditions will continue unchanged until the silver price climbs over $15 - $17 or higher, and the gold price climbs over $940. Even then, high premiums may be the rule for quite some time.

Today the gold price rose US$24.70 to US$903.10; the silver price jumped 39.2 cents to $11.717.

STOCKS continued to drop today, down another 126 points to close at 9,321. Dollar kept dropping, too, to 80.818, down 22 basis points.

The gold price has now reached its last high around $905. Brace yourself -- and keep braced -- for any sudden drops in gold. Volatility rules, but the trend is up. If gold makes it through $905 on this try, next barrier is $928. The big test comes, however, at the July high, US$977. Once the gold price passes US$977, it will blow the ears off everybody watching.

Expect the silver price to keep lagging as fear of systemic financial crisis drives market psychology. Does that make me want to crawl into a hole because I have for so long recommended buying more silver than gold, or even swapping gold for silver? Not at all, because as time passes the silver price will catch up and outpace gold, at which point we wills swap silver for gold and wind up with far more ounces of gold that we would have, had we bought gold rather than silver in the first place.

Buy silver and gold. Buy whatever form you can get fastest delivery on, buy on delayed delivery if you can't get fast delivery, but buy. The door into physical silver and gold is very small, and won't accommodate panicked crowds. As fierce as this buying panic has been, it will pale next to the panic that will break out when the public realises they've been had, and the US dollar has been sacrificed to save the banks.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Tuesday, October 07, 2008

The Low for Silver and Gold Prices Happened Last Friday

Gold Price Close Today : 878.40
Change: 15.70 or 1.8%

Silver Price Close Today : 11.325
Change: 9.5 cents or 0.8%

US Dollar Index Today: 81.04
Change: -0.58 or -0.7%

SILVER and GOLD PRICES took another roller-coaster ride today. Around noon Central Time somebody attacked silver and gold prices, driving gold down to $860, but it quickly recovered. After closing (1:25 EST) at US$878.40, up US$15.70, gold traded up another nine bucks in the aftermarket to US$887.30. Strong performance.

The SILVER PRICE dropped as low at $11.13, but Comex closed at $11.3250, up 9.5 cents, then climbed 22 cents in the aftermarket to $11.545. Premiums are huge but remain strong. Demand is overwhelming us, with 50 or more phone calls waiting on us in the morning. Stock is somewhat more readily available, that is, we will be able to ship 90% silver coin and off-brand 100 oz. silver bars on Monday, but almost everything else is a week or much longer out.

It seems now that the low for silver and gold prices happened last Friday, but even as I say that my "Government Surprise Party" Warning Needle slams over into the red. Watch out for volatility, watch out for manipulation, but buy every dip because (1) government bailouts must result in inflation, (2) driving silver and gold prices much higher. The contagion's spread to Europe only makes that more likely.

In modern usage, influenced as it is by psychobabble, the words "wicked" and "evil" have fallen into disuse. Yet how precisely does one describe (medieval as it may make one sound) an entire system founded on theft, gambling, usury, and exploiting greed? And now that it's falling apart, all those who have fed at its trough with their snoots deep in the swill have become "salvationists". That is, they have discovered that, no matter what happens or how much WE have to pay, the system must be saved. If that's not "evil", tell me what it is.

Stocks closed nearly on the low of the day, the Dow down 500.27 points to 9,455.23 [sic]. The S&P500 closed below 1000, down 996.23 to 60.66. Yet these dismal performances were not the worst news. The Dow in Gold Dollars (measuring the value of stocks in gold) sank, no, plunged, plummeted, to a new low of G$222.51 (10.764 oz), about G$15 (0.726 oz) below the last low in March. I can find no floor here, no target yet. The Dow in Silver Ounces plunged to 819 oz. And stocks will drop lower still. The long term target is the Dow at G$41.34 or less (2.00 oz) & 32 oz. of silver or less. Get out of stocks.

The US DOLLAR INDEX vomited back 55 basis points from yesterday's 100 plus gain. What happened? Is the grand alliance of central banks cracking up? Is somebody dumping dollars? Technically it bounded off the top boundary of the Bollinger band. Dollar remains above its 50 & 200 day moving averages, but RSI has turned down and MACD is ready to turn down. I wouldn't be surprised to see it climb, fitfully, all the way to 83.5, but don't bet on the dollar long term.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Monday, October 06, 2008

Keep Your Eyes on the Horizon, the Long Term: Huge Dollar Inflation that Will Cripple the Economy and Drive Silver and Gold Prices Higher

Gold Price Close Today : 862.70
Change: 33.80 or 4.1%

Silver Price Close Today : 11.230
Change: -4 cents or -0.4%

US Dollar Index Today: 81.62
Change: 1.02 or 1.3%

The Great Sweater of International Finance is coming unravelled before our eyes. Chancelloress Angela Merkel of Germany may have nailed the lid of the EU's coffin shut today by guaranteeing all the bank deposits in Germany. Danke schön, Angela! Now nobody else in the EU has a reason to hold bank deposits in any country but German (except the Irish & Danish, whose governments had already taken the same step). Did Angela turn loose a flood of bank deposits from their home countries into Germany?

In Germany the government bailed out Hypo Real Estate for $69 billion, and French bank BNP Paribas bought Belgian assets of Fortis bank while the Dutch government nationalized Fortis' operations there. German stock market fell over 7%, largest fall in history.

In the US the Dow closed below 10,000 at 9,959.48, dropping as low as 9,525.32, leaving the Nice Government Men with a lot of heavy lifting to get the Dow back up.

And speaking of the Nice Government Men, today the Fed (stands for Frantically Expanding Dollars) announced that its Term Auction Facility or TAF (stands for Totally Astronomical Folly), which buys mortgage-backed securities, would be immediately doubled to $300, and it could increase this to $900 billion by year-end (read "will" for "could").

Remember that the Nice Government Men have only two weapons to stem any financial crisis (if we ignore secretely shooting people in the back of the head), namely, blarney and inflation. A crises places before them two challenges, broken confidence and disappearing liquidity. They trot out their Talking Heads Whom The People Revere, people like Warren Buffet or Iron Paul Volcker, and of course all the apparatchiki like Paulson & Bernanke, to spread the blarney, the propaganda intended to mend the public's broken confidence. Next line of attack is to restore liquidity (cash & credit) to a system so frozen with fear that nobody will risk loaning out any money.

NGM flood the system with liquidity (cash, loans, loan guarantees, deposit guarantees) to solve that problem.

That's the whole game in a nutshell. I know, because I bothered to read the reports from the CFR's Financial Vulnerabilities Project convened in 1998 by Bill Clinton. In those proceedings the Great Ones Who Control Our Economic Fate admitted they have some sort of system-threatening crisis about every 2 years, so they undertook to investigate how best to ward off crises. They even had one session where they "gamed" a crisis with teams from (as I remember) the Fed & Treasury & SEC & FDIC in different rooms in the Harold Pratt House who had to come up with answers as they fed them problems.

That's another reason I smell a rat. The NGM, or at least the Masters who control them, already had a solution before this crisis erupted. If anybody knows, they know how fragile the fractional-reserve, debt-based financial system really is.

Under pressure of the spreading financial crisis the GOLD PRICE is rising against silver. Today the paper price Gold/Silver Ratio was over 78, while the best physical ratio was only 67.7. This will last a while, but silver holders shouldn't worry, 'twill end.

The GOLD PRICE rose $33.80 today to $862.70, the SILVER PRICE fell 4 cents. As I've said so many times before, cheapest way to manipulate the gold market is to drive silver and platinum down. Just mark that down to my suspicious nature.

Under pressure of the crisis the US DOLLAR INDEX, Dog Among Currencies, rose a full 101 basis points today. The Euro fell a bit. No doubt that reflects a flight to safety, i.e., cash. By the way, here's a little tidbit I acquired from some helpful government officials a few years ago: 75% of all US currency circulates outside the United States. So if you see that the Fed has issued $800 billion in currency (not talking credit here), that means that only $200 billion remains in the US, probably about $500 per head.

While you're sitting back enjoying the crisis, here are a few suggestions: get a month's worth of expenses in cash from your local bank. Buy some canned goods. Start planning what you're going to do when you lose your job, and meditate on moving out of the city.

Keep on buying silver and gold. Expect brutal volatility, and don't let it terrorize you. Keep your eyes on the horizon, the long term: huge dollar inflation that will cripple the economy and drive silver and gold prices higher.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Friday, October 03, 2008

Silver and Gold Prices Will Go Much Higher - This Period of Suppressed Prices is a Gift, an Opportunity, to Load Up

Gold Price Close Today : 828.90
Change: -10.10 or -1.2%

Silver Price Close Today : 11.270
Change: -20.5 cents or -1.8%

US Dollar Index Today: 80.60
Change: 0.16 or 0.2%


In the face of last week, I'm not certain I have anything either intelligent or intelligible to say. The House finally passed the bailout bill, but only after the Senate had larded it with nearly $200 billion in tax breaks for the "friends of Congress". In the end, the banks got what they wanted, a gigantic grave to shovel all their corpses into, and the assured silence of the cops (read: Yankee Government). Relax. Government by the banks, of the banks, and for the banks shall not perish from the earth. The corruption is complete, the constitution dead, but, gee-whillikers, we won't have to face an awful deflationary depression. Nope, we'll face a hyperinflationary depression instead.

Well, well, aren't I jolly today?

To markets. The week beat everything to death, & unless you are blind and know nothing about the US Treasury's slush fund ("Exchange Stabilisation Fund") installed in the 1930s to manipulate the prices of gold, the dollar, and whatever else might be fun to play with, you perceived that the US Treasury and Fed manipulated the dollar's value upward, in the face of the worst financial crisis in 70 years. Now the dollar index has again reached the long term downtrend line. Will it break out, or stall in a double top & fall back? I don't know. Friday's sell off in silver, gold, and stocks suggest the market proverb, "Buy the rumour, sell the news." The stock market's failure to rally on news of the bailout passing certainly looks bad for stocks. I simply do not believe that market demand drove the dollar up on Friday; twas the Nice Government Men "stabilising."

Markets are so out of whack I don't know what to say. In 28 years trading silver and gold professionally, I've never seen markets like this. The paper gold price closed Friday at $828.90, down $10.10, but if I want to buy gold to hold in my own hand, physical gold, I would have had to pay $879.07 an ounce (US$50 more) to get Mexican 50 pesos, US $923 to get American Eagles, and US$949.35 to get French or Swiss 20 francs.

The Silver Price closed at $11.27, down 20.5 cents, but to buy US 90% silver coin and wait 2-8 weeks to get it I would have to pay $15.18 per ounce, a 36% premium over the paper price. And silver American Eagles? Well, forget them. They cost $16.81, a 50% premium, and heaven only knows when I'll get delivery.

How can this be explained? It appears incontrovertible that demand for silver and gold, real, physical, deliverable silver and gold is so strong, so frantic, that the public is willing to pay huge premiums to buy it. That casts the validity of the paper price into doubt, and points to some government manipulation holding down the price, so the weakness of their rescue operation won't be called into question by a gold price over $1,000.

For the future it says to me that silver and gold prices will go much, much higher, and that this period of suppressed prices is a gift, an opportunity, to load up on silver and gold at bargain prices. Stocks will fall further yet. Whether the US Dollar extends its rally or not, it won't last long and in eight weeks or so will hit the skids again.

Many surprises are possible, but I cannot imagine how this bailout will fail to result in huge inflation, perhaps hyperinflation. Hold dollars at your own risk.


Many of y'all have kindly inquired about my wife, Susan's health after her heart surgery 28 August. Yesterday I drove her to Nashville for her first post-op check-up and she got a very good report. She is off most of her medications, which had slowed down her heart leaving her fatigued and often nauseated, and only has a few more weeks on coumadin. The doctor allowed her to drive again, great for her but murder for me because I'm the one who has to keep restraining her from overdoing it. All in all it was a splendid report, and we thank God for his mercy.

Yesterday I learned a friend of mine died at age 87, Leslie Fleming. Years ago, in the early 1970s, I met Les when he and his wife were homesteading in northern Arkansas. He taught me how to think, how to search for the core of what things mean. In every facet of his integrity, he was what I call an "Old American," that is, as they used to be before luxury & government education & the entitlement mentality corrupted them. Leslie Fleming was man too great for the age, unshakeable in his principles. Thank you for teaching me. Requiescat in pace.



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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Thursday, October 02, 2008

Gold Price Dropped a Colossal US$41.70 - Sure, Sure, That Always Happens When the World Threatens a Financial Tsunami, Everybody Runs to Sell Gold

Gold Price Close Today : 839.00
Change: -41.70 or -4.7%

Silver Price Close Today : 11.065
Change: -1.655 or -13.0%

US Dollar Index Today: 80.45
Change: 0.75 or 0.9%


Y'all may not be aware of it, but according to The Moneychanger Bank Liquidity Analysis®, when the liabilities of the entire banking system are compared to the reserves of the entire banking system, the banks have about 69 cents for every $100 they owe in deposits. Admittedly, that’s out of date a bit, because when the Fed discontinued publishing M3 figures, I couldn't figure it any longer. Shoot, by now they probably have 71, maybe even 73 cents.

And the Nice Government Men are worried about bank runs, you bet your life. That's why they raised the FDIC insurance deposit limit from $100,000 per account to $250,000 per account. Little known fact: banks have no cash. Literally. Haven't kept it for years. Greed decrees they keep no reserves, but put everything "to work," so why miss interest by keeping cash lying around in the vault. Illiquidity, thy name is bank! Now rumours of a banking holiday abound, when the government closes down the banks for a week or so to cool off the depositors' frantic desires to see their money again, foolish hoi polloi that they are.

Now, look here: the US DOLLAR INDEX rose 74.6 basis points today, & early in the day was up over 81. Sure, sure, that's logical to me: entire US & world financial system leans over the brink of meltdown, US Congress is deadlocked over whether it will consent to bailing out the banks, nobody is in charge, derivatives collapse threatens world-wide financial holocaust, Fed & Treasury are intent on pushing thru more bailouts that will suck value out of a dollar like an otter sucks clams out of their shell AND the US DOLLAR rises. Sure, sure, sure.

And of course, silver and gold prices fall. The GOLD PRICE dropped a colossal US$41.70 to US$839 while the SILVER PRICE flushed 165.5 cents to $11.065. Sure, sure, that always happens when the world threatens a financial tsunami, everybody runs to sell gold. Right. The gold price has been driven back under its 200 day moving average. Ditto the silver price. Right.

Meanwhile stocks, are represented by the Dow Jones Industrial average, sank by 348.22 to 10, 482.85 or 3.2%.

What's the sum of these counter-intuitive moves? Why, my dear, somebody is "painting the tape" to make things look better than they really are. Now who would do such a thing? What to do? In case it hasn't been beaten into your skull yet, the Fed and the US Treasury will inflate their way out of this crisis, even if they have to push money out of, well, helicopters as Ben Bernanke suggested in 2002.

When they do, silver and gold prices will soar. Right now (sorry for sounding conspiratorial, but it's not paranoid when there really is one) they must keep the lid on metals and pump the dollar. All without any will, they are offering you an escape route: buy all the silver & gold you can buy.

To give you an idea of what the real prices are, as opposed to the paper prices, if you wanted to buy the cheapest gold coins today, you would have paid US$878.76 an ounce (for Mexican 50 pesos) and for silver you would have had to pay $13.38 (for one ounce rounds). Of course, that's in the real world, not the government-run world.


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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.



Wednesday, October 01, 2008

Gold Price Chart Today Looks a Bit Odd

Gold Price Close Today : 880.70
Change: 6.50 or 0.7%

Silver Price Close Today : 12.720
Change: 48.9 or 4.0%

US Dollar Index Today: 79.70
Change: 0.21 or 0.3%

The GOLD PRICE chart today looks a bit odd, trading up strongly into noon, then falling sharply. It rose $6.50 today to close at $880.70, then faded off $8 to $5 in the aftermarket.

The SILVER PRICE rose 48.9 cents to close at $12.72. Arresting figure of both silver and gold price charts is the gap in the chart for Tuesday. Technical rule of gaps is that "gaps are always filled", except for breakaway gaps, and today the market traded back up to fill the gap, then traded back. However, does any rule mean anything any longer? Why would silver and gold prices gap down on Tuesday, suddenly, both of them? Why, when the financial system is tottering and teetering? Why, when physical silver premiums say silver's price is not the paper price of $12.50 but $16.00? Hogwash, I just don't believe it, anymore than I believe that stocks are in a bull market., or that pigs can be taught table manners.

For my part, I would keep on buying silver and gold, and shucking stocks and US dollars.

Have y'all noticed yet that the US DOLLAR INDEX's rally to 80 merely touched the long term downtrend line? Need I point out that this is not strength, merely a bear market rally? Nice Government Men (NGM) have been ferociously slapping their defibrillator to the dollar's corpse, trying to raise it up off the slab, but so far have not quite reached the last high at 80. When the announcement of the bailout agreement comes from congress, the dollar will undergo one last jolt, and then expire.

About the same time stocks will show a one-day surge of upward enthusiasm for the bailout agreement, then wilt again. Use any rally to get out of stocks.

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

- Franklin Sanders, The Moneychanger

"Buy Silver and Gold Coins at the Best Prices"
The-MoneyChanger.com

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.