Gold - getting it& keeping it

[Joyce Hoffman-Gayley]

I wasn't sure where to start this thread so since gold is shiney I decided this would be the place. Here is my question: If any of you have purchased gold (or other precious metals for that matter) how did you go about it? I want to get some in small quantities to start off with but don't know who or where to get it. I am only able to buy abut $5000 worth at this time and will sporadically be able to get more in the future in like amounts. I've done some research but have no experience as to who is trustworthy. If anyone of you have ideas, tips or info you would be willing to share, I would be tremendously grateful. Also, how do you store it? Thanks ahead of time.

[KyDave59]

I'll start from the bottom. You will need a good quality safe, at a bare minimum. This safe will need to be bolted to a concrete pad, such that a thief can't simply pick it up and walk off with it. It will need to have a good quality lock on it, such that the only way inside, other than the lock, will require an Oxy-Accetylene cutting torch, or a substantial quantity of Nitroglycerine [1]. It wouldn't hurt to have a decent alarm system on it, too. Those requirements, alone, will set you back probably close to US$1K, if not more. Don't cheap out, else your investment may evaporate. :-(

[1] There are other ways of getting into safes, but I'll not list them here, since they require exotic materials, or take ridiculous amounts of time, etc., and I don't want to spread information to thieves.

The next step is to conceal the safe, and ensure that you NEVER tell anyone about it. That goes for your family as well as yourself. You don't want your 12 year old son bragging to his buddies that you have a "safe full of Gold" in your house. Otherwise, you may have some idiot that tries to take you hostage, to get you to open your safe so he can clean it out.

Next, I'd skip Gold. The value of it (which is currently about US$1200/ounce), means that even a small Gold coin has a rather incredible value. Krugerrands, which are one common form of Gold coin, are going for about US$1300 now. Those would be very impractical to take to the store to buy a loaf of bread with, even in a PAW/SHTF/TEOTWAWKI scenario, where the price of bread has skyrocketed. If you insist on going the Gold route, the best option may be to purchase Kruggerands, American Gold Eagles, or Canadian Maple Leaf coins. Those are in known sizes/denominations. Unless you're a billionaire, you're simply not going to be buying Gold bullion bricks.

Make sure you buy from a reputable dealer, since there are MANY counterfeits out there. If you buy from an un-reputable dealer, you may end up getting a Lead coin with a few Angstrom thick plating of Gold, which will be worth about US$.02, or maybe less. Make sure you take possession of the coins, usually via insured postage. Gold coins stored elsewhere are worth exactly the value of the paper certificate you have saying that you own them (e.g., US$.00000001 or so).

Rather than Gold coins, one option is to invest in Silver, usually in the form of coins. These usually have a much lower value, such that they can be used in everyday trade. You can still find old Silver coins, but don't pay too much of a premium for them.

There are some people who collect more common coins, based on the theory that the coinage metal used for them will be valuable. Most US Mint produced coins are based on a Cupro-Nickel alloy (75% Copper, 25% Nickel?). Do NOT collect current US pennies, since these are now Zinc with a very thin Copper plating, and, as such, have almost no intrinsic metal worth. Also, be wary of some Canadian coins, since they've switched from using pure Nickel, to using steel blanks which are Nickel plated.

That ought to be enough to get you started. :-)

Dave

[Cwi555]

At the moment, no one can predict where the price will be post election and December FOMC meeting. The VIX index (volitility) is on the rise, and PM'S which should have risen during VIX rises fell flat last Jan/Feb.

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Net shorts are totally disconnected from market standards as well.

http://www.cftc.gov/dea/futures/deacmxlf.htm

Add to that the dollar index is way over what it should be.
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A significant downward divergence cross is emerging in the MACD as well for the DXY.

http://www.investopedia.com/terms/m/macd.asp

Boiling that down, the market is getting as unruly as a spoiled child that had just been told they are getting no ice cream.
The scenario has the distinct possibility of turning into a pump and dump where PMs get pumped then fall through the floor if the net shorts are any indication.

If you do jump into gold/PM's, understand there is a distinct likelihood it will be a loser in the short term.

Long term (+30 years) is another story.

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I ate a lot of Ramen noodles between 1998 and 2002 and would have gone hungry if I didn't work contracts that paid per diem that covered food in that time. 50% of income went to gold in those years with the remainder also dedicated to what I considered preps. Family, many former 'friends' laughed at me and ridiculed for it at the time. All I have to say is 'how do you like me now'.

I say that to give you both ends of the spectrum and some advice. If you're not thinking long view, stay out of PMs, there are better options for the short and medium terms. If you're thinking long term, then by all means jump with the above information in hand, long term is a win. I personally go through kitco.com and apmex.com.

My .02 worth

[Sacajawea]

I like apmex, also. I have some gold, but mostly silver. I'm not sure that's the "right" ratio lately, but on the other hand I'm temporarily not buying at all. Things may have changed, but we figured the best deal in gold were the 1/2 oz (.9999 fine) First Ladies series from the US Mint or Apmex. You can also subscribe for proof sets etc from them.

Do NOT look at investing in paper PMs. You'll drive yourself crazy. Think of gold and silver as savings & savings that you can write checks on -- in a worst case currency disaster. Gold is savings for the long-term future and big purchases. Silver is for those everyday uses -- and in my mind, silver is a little "safer" to carry in a WROL situation because more people will have some and be less likely (neither of these ends of the spectrum are absolutes, mind you) to shoot you for what you're carrying. There are those who believe that silver will increase in value more than gold, and I guess that explains my current balance. I'm not sure it's correct so do your own research and make up your own mind.

If you're ever in a position to make a larger purchase (at one time) than you've suggested, make sure you read up on the IRS rules & regs for dealers and purchasers.

And plan now for where & how you're going to store it. IMO, putting it in a safe is just pointing a glaring neon sign to would-be burglers and thieves. This stuff gets HEAVY should you ever be in a position to have to move.

[Joyce Hoffman-Gayley]

Thanks to you all for your valuable advice and helpful insights. Apmex is where we are looking to do our purchasing. I understand the impractical of getting large denomination coins. For that reason we are thinking of getting a few Combibars from Valcambi. These come in several different weight. The thing that I like about them is that they come in pre-scored bars that can be broken into either 1 gram or 1/10 of an ounce pieces. Thus more easily used as everyday currency. They are available in gold, silver or platinum. As to old silver coins, I have been collecting and saving them since the 70's. Finally, storage is not a problem. We have several caches of supplies and have put coins with them. I think we will probably keep with that plan. If we have to bug out the last thing I want to deal with is a safe that's bolted to the floor of the house that I am leaving behind.

[Kessler]

A 3'x3" piece of Schedule 40 PVC with a glue on cap and a screw on cap and a post hole digger and a 5' hole. Plant a rose bush on top.

[W.Lynn]

For more information, precious metals have always been welcome in the currencies & commodities thread too, though we sidetrack from time to time. Right now, it's about the fact that companies aren't replacing big rigs if they don't have to. I'll update the live data chart for silver though, and see what else is out there to be found.

[Cwi555]

If you do jump into gold/PM's, understand there is a distinct likelihood it will be a loser in the short term.

Silver has dropped 2 dollars in three days, gold has dropped 100 dollars in the same period as of the time of this post.

[Zef_66]

Silver has dropped 2 dollars in three days, gold has dropped 100 dollars in the same period as of the time of this post.

I just ordered 20 ounces today to give as christmas gifts. I had been watching it for a couple weeks and decided to jump on it today.

[redman2006]

stupid question, but suppose you had received a Christmas gift from Zef, and being an ungrateful child, you wanted to redeem it for cash, how would you do so and not lose a large percentage at a "we buy gold and silver" place?

[Cwi555]

stupid question, but suppose you had received a Christmas gift from Zef, and being an ungrateful child, you wanted to redeem it for cash, how would you do so and not lose a large percentage at a "we buy gold and silver" place?

You're going to lose a significant percentage regardless of what you do outside of the store it was slated for.
Your best option is a place like this;

http://www.cardpool.com/

I've never used that place, but the general basis is you lose less from them than a pawnshop.

[Zef_66]

You're going to lose a significant percentage regardless of what you do outside of the store it was slated for.
Your best option is a place like this;

http://www.cardpool.com/

I've never used that place, but the general basis is you lose less from them than a pawnshop.

I think Red was talking about getting one of the silver American Eagle that I give out as gifts to my children, nieces, and nephews. I'd say find someone such as myself to sell it to. If spot price of silver is $19/oz. A pawn shop is going to pay $16/oz and sell it in their store for $20/oz. If you can sell it to the same person that goes in the pawn shop to buy silver for $18/oz, everyone wins (except the pawn shop owner). Selling person to person is the best way to make the most money off your Christmas investment. But it is also the most risky as person to person dealings take time to setup and can have the most problems.

[Cwi555]

In that case, Zefe is correct for small quantities. Anything more than 10 oz you can sell to apmex or similar.

[KyDave59]

e-bay?

I noticed that they have quite a few American Eagle coins listed, some for rather ridiculous prices. Of course, as with anything purchased from e-bay, beware of counterfeits.

Dave