• The Gold Price Dropped 2.2 Percent this Week Ending at $1,131.80

    10-Jul-15 17-Jul-15 Change % Change
    Gold Price, $/oz. 1,157.70 1,131.80 -25.90 -2.2
    Silver Price, $/oz. 15.468 14.82 0.648 -4.2
    Gold/Silver Ratio 74.845 76.370 1.525 2.0
    Silver/gold ratio 0.0134 0.0131 -0.0003 -2.0
    Dow in Gold $ (DIG$) 317.13 330.34 13.21 4.2
    Dow in gold ounces 15.34 15.98 0.64 4.2
    Dow in Silver ounces 1,148.20 1,220.41 72.20 6.3
    Dow Industrials 17,760.41 18,086.45 326.04 1.8
    S&P500 2,076.62 2,126.64 50.02 2.4
    US dollar index 96.17 97.81 1.64 1.7
    Platinum Price 1,032.30 1,001.00 -31.30 -3.0
    Palladium Price 649.35 618.00 -31.35 -4.8

    3 Day Gold Price Chart
    30 Day Gold Price Chart
    5 Year Gold Price Chart
    3 Day Silver Price Chart
    30 Day Silver Price Chart
    5 Year Silver Price Chart

    Again — heaven knows I’m tired of that word — SILVER and GOLD PRICES dropped. On Comex silver lost 14.4 cents (1%) to close $14.82 while the GOLD PRICE lost $12 (1%)

    Gold Price

    Ain’t nothing for it but to say they have to stop soon or drop much further. Gold’s low today at $1,129.6 revisits the November 2014 low. Turnaround time. Gold price chart on the right.

    Nothing points to a turnaround in silver except its nearness to the recent low at $14.62 and last December’s low at $14.165.

    I reckon I may get my head handed to me on a platter, but I have to stick with it: we’re seeing a seasonal low that will mark the bottom of the long bear phase. We’ll know next week.

    After a four year bear phase has beaten up the silver and gold price and left stock investors preening themselves and sticking out their tongues at us, it might be helpful to recall a bit of history. Gold’s 1982-1999 bear market against stocks topped on 25 August 1999 with gold at $266. Silver’s 1982-2001 bear market topped 7 June 2001 with silver at 432.3 cents. How have they done since then, as of 16 July 2015? Here are the numbers:

    Results for Gold against stocks from 25 August 1999:
    – Nasdaq 100, up 87%
    – Nasdaq Composite, up 80.5%
    – S&P500 up 54%
    – Wilshire 5000, up 75.6%
    – Dow Industrials, up 60%
    – Gold, up 330%

    Results for Silver against stocks from 7 June 2001:
    – Nasdaq 100, up 82%
    – Nasdaq Composite, up 85%
    – S&P500 up 44%
    – Wilshire 5000, up 65%
    – Dow Industrials, up 40%
    – Silver, up 347%

    Rough week for silver and gold prices, down 4.2% and 2.2%, but a good week for stocks, up about two percent. Last hurrah, I reckon. US dollar index removed all doubt about which way it would break: UP. Platinum and palladium are sinking out of sight, and the world is abuzz with a deflation scare. Well, that’s only a boogeyman, but an effective one.

    Why a boogeyman? Because “inflation” is “an increase in the money supply” while “deflation” is a decrease in the money supply, and you can search the wide world over and you won’t find any country whose money supply is decreasing. Every central bank in the world has responded to the chronic economic crisis since 2008 by creating money in amounts vaster than history knows. What ought to deflate is all the bad debt and bad investment in the world, but that is precisely what the central banks are preventing Rest assured, tuck this into your heart, swing across the vastest chasm safely using this for a rope: if real deflation threatens central banks will create new money until the electrons pop out of their eyeballs. It won’t “jump start” the economy, but it will melt the monetary and financial jumper cables.

    What the world needs is a debt jubilee, a simple write-off and walk away from all the unpayable debt, and the destruction of the machine that made it possible, central banks and government deficit spending.

    Whoo! That feels better. Now, let’s look at markets.


    That nasty, scrofulous, scabby fiat US dollar, that is, the US dollar index, went back and forth this week and finally made up its mind to tip its hand and rise. This week it broke out of an even sided triangle in a move that could carry it to 104. Closed today at 97.81, up 53 basis points (0.54%). Higher dollar will blow a headwind against commodities and gold and silver, but don’t be fatalistic. A risin’ dollar ain’t the only thing happenin’ in town.

    But a risin’ dollar’s sure pizen to the euro, as if it took much pizen to kill anything that sick. Today the euro lost 0.31% to $1.0846. This Greece mess makes it plain that the swoll up bureaucrats runnin’ Europe have finally lost their minds. They think they’re about to gobble Greece whole, but they are likely to choke on a bone no Heimlich will dislodge.

    Japanese ain’t about to choke on a bone, cause they chop everything up and eat it raw. Yen gained 0.5% to 80.60, while its chefs in Tokyo just keep chopping it up into little bitty sushi.

    Dow in Gold

    Stocks were confused today. The adrenalin from the Greek-relief rally seems to be wearing off. Dow lost 33.8 (0.19%) but the S&P500 gained 2.35 (0.11%). Both the Dow and S&P are positioned above their 20 and 50 day moving averages, ready to rise further next week. (It’s still a broadening top.)

    Dow in Silver

    Dow in gold is testing the outer limit of how wrong I can be. Closed today at G$330.13 gold dollars (15.97 troy ounces), 2.5% above the March high. Chart is on the right.

    Dow in silver closed the week at S$1,578.96 silver dollars (1,221.23 troy oz). Does that wreck the pattern and foretell stocks rising against silver (and gold) forever? Well, wait a little. This is just about when silver and gold ought to be making lows, and nothing’s happened to make the US economy or stock market any more attractive than it looked six weeks ago. Just wait till next week and see. Dow in Silver chart’s on the left.

    Y’all enjoy your weekend.

    Aurum et argentum comparenda sunt — — Gold and silver must be bought.

    – Franklin Sanders, The Moneychanger

    © 2015, 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 or 18 ounces of silver. or 18 ounces of silver. US $ and 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.

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