Monday, December 19, 2011

With the Gold Price this Low it's Your Opportunity to Buy One Last Time at Bargain Basement Prices

Gold Price Close Today : 1594.40
Change : -1.20 or -0.1%

Silver Price Close Today : 2882.20
Change : -79.3 cents or -2.7%

Gold Silver Ratio Today : 55.319
Change : 1.441 or 2.7%

Silver Gold Ratio Today : 0.01808
Change : -0.000483 or -2.6%

Platinum Price Close Today : 1407.30
Change : -9.80 or -0.7%

Palladium Price Close Today : 608.65
Change : -13.65 or -2.2%

S&P 500 : 1,205.35
Change : -14.31 or -1.2%

Dow In GOLD$ : $152.55
Change : $ (1.17) or -0.8%

Dow in GOLD oz : 7.380
Change : -0.056 or -0.8%

Dow in SILVER oz : 408.24
Change : 7.55 or 1.9%

Dow Industrial : 11,766.26
Change : -100.13 or -0.8%

US Dollar Index : 80.38
Change : 0.114 or 0.1%

The GOLD PRICE and SILVER PRICE what is going on? I can't get around this conclusion that the Big Cause right now is the European bank solvency crisis. It's huge, it's hungry, and it can't be fixed and ain't being fixed. When the panic begins, as it did in 2008, the drain sucks down everything in a heartbeat.

And I will keep on saying this until y'all put your hands over your ears and run for cover: THIS IS NOT THE END OF SILVER and the GOLD PRICE BULL MARKET. This is your opportunity to buy one last time at bargain basement prices. Wait a while if you please. Sure, all the wild numbers are possible, gold at $950 and silver at $16 -- POSSIBLE, but neither you nor I can read the future perfectly. Hence, we weigh possibilities and probabilities and make the best choice we can and trust God for the outcome.

Here's what's happening right now. As long as the SILVER PRICE holds 2600c and the GOLD PRICE holds $1,535, no big drop is coming. Below those levels gold falls to $1,475 support and silver to 2000c.

Today GOLD backed off to $1,594.40, giving back $1.20 but remaining above $1,590 (low struck at $1,585.80). On the other hand, gold was stopped at $1,607.40, so couldn’t pierce that $,1,605 resistance.

Why is the premium on US 90% silver coin rising? That generally only happens at bottoms, even at interim bottoms. But strengthened it has.

SILVER lost 79.3c and closed Comex at 2882.2c, a whopping 2.7% loss compared to gold's nothing change. Well, it's to be expected that silver in a correction will be weaker than gold. If that surprises you, you ought to go back to playing pinball machines, because you haven't yet understood this game.

One thing that makes me suspect even my own bearishness is this: when everybody believes a market is going much lower, it won't. Nobody is left to sell it.

But I am willing myself to be patient here and watch silver and gold unfold, and to watch every indicator very closely -- I have indicators y'all know not of -- for the least sign of a turnaround.

I have posted the December Moneychanger at for paid subscribers.

At you can read how the MF global bankruptcy trustee is picking the pockets of the victims/former customers who held Warehouse Receipts for physical silver and gold through MF Global.

First, get this clear in your mind. Until now a "Warehouse Receipt" has been a sacrosanct security, a receipt for stored physical gold and silver, that has never been repudiated, since memory runneth not to the contrary. Yet now MF Global and this bankruptcy trustee, have found a way to render WRs worthless.

Apparently MF Global bought Incredible Shrinking Gold and Silver for its customers, since the trustee proposes dumping it all into a pool and paying only 72% of what's owed -- not physical gold or silver, mind you. So although the gold was supposed to be (1) wholly owned by the customer and segregated and (2) therefore not subject to MF Global's bankruptcy and (3) supposed to be held in physical form under bond, it ain't there.

I offer this account as an example of why I have kept on telling y'all with excruciating regularity and consistency that YOU MUST TAKE PHYSICAL DELIVERY OF YOUR SILVER and GOLD. I have been warning for years that huge amounts of unbacked paper silver circulate, and that at some point in this bull market some large safekeeper of silver and gold will default, and will be discovered to have the equivalent of wooden bars painted silver and gold.

Yes, yes, I know people point at me and snicker that I'm just a suspicious natural born fool from Tennessee, uncouth and unsophisticated in the wise ways of Wall Street. Indeed, that may be true, but MF Global didn't pick MY pocket. Folks, y'all can trust Wall Street. Y'all can trust the financial and banking establishment. Y'all can trust the US government and the Federal Reserve. Y'all can trust them to steal your money, your clothes, your peanut butter sandwich, and throw you out of a boat holding on to an anvil and poke fun at you as you sink.

Trust me. I know 'em.

I'm trying to get past the bearish pictures on the gold and silver charts and remind myself that foregone conclusions do not exist. Somebody is doing Legion's job talking down silver and gold when they've ensnared me. Now that both metals have bounced (Friday), we'll get a better idea of how bad this will be. But more later.

STOCKS are now catching up with silver and gold. Dow today lost 100.13 (0.84%) to close at 11,766.26. S&P500 closed 1,205.35, down 14.31 (1.17%) and 5 scant points from crushing morale by dropping below 1200. Silver and gold's outlook may be fraught with pain, but at least after a while they will come back -- stocks won't. At least, in no span of time likely to do y'all any good.

Despite the best efforts of the Nice Government Men and Central Bank Lackeys and Running Dogs (CBLARD), the US dollar index rose again today, up 11.4 basis points (0.15%), still hanging in above 80. Dollar is rallying, European crisis is driving it, it will go higher before this ends. That will make life difficult for silver and gold.

Meanwhile the euro sank beneath 1.3000 again to 1.2995, down 0.41%. Gazing upon the euro, the move from 1.4247 in November down to 1.2945 last week, may be a fully completed move. If so, the euro will correct briefly, up to l.3200 or so, before it resumes its plunge toward the earth's core.

The Japanese yen looks ready to move lower, but has established a support line over the last 1-1/2 months about 128c/Y100. Closed today at 128.15c/Y100 (Y78.03/$1), down .36%.

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

- Franklin Sanders, The Moneychanger

© 2011, The Moneychanger. May not be republished in any form, including electronically, without our express permission.

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 bubble has burst, primary trend down.

WARNING AND DISCLAIMER. Be advised and warned:

Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures.

NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps.

NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced.

NOR do I recommend buying gold and silver on margin or with debt.

What DO I recommend? Physical gold and silver coins and bars in your own hands.

One final warning: NEVER insert a 747 Jumbo Jet up your nose.