Gold

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Wads
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Gold

Post by Wads » Sat Nov 10, 2018 12:24 pm

I would like to add gold as part of my portfolio but would rather own physical gold over GLD or IAU. Do any of you have experience purchasing gold bars online and what sites do you suggest?

Bro
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Re: Gold

Post by Bro » Sat Nov 10, 2018 12:44 pm

Goldmoney.com is an option. I've used it - it can take a while to get cleared for an account though.

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Tyler9000
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Re: Gold

Post by Tyler9000 » Sat Nov 10, 2018 12:52 pm

If you're all the way to gold bars then you might want to pay attention to shipping costs. ;) But even if you're talking about the 1oz bars, I'd generally recommend sticking to more common bullion coins like American Eagles, Maple Leafs, or Krugerrands.

While I haven't used them myself, I've heard good things about APMEX and Texas Precious Metals.

Wads
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Re: Gold

Post by Wads » Sat Nov 10, 2018 1:05 pm

Im looking to purchase a couple of 10oz bars. I looked into goldmoney.com and found customer reviews concerning. In regards to shipping cost, it seems like most sites are free although I'm not sure about insurance. Anyone used JM Bullion?

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C40
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Re: Gold

Post by C40 » Sat Nov 10, 2018 1:34 pm

I bought from APMEX over 5 years ago and it went well.

2Birds1Stone
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Re: Gold

Post by 2Birds1Stone » Sat Nov 10, 2018 2:57 pm

APMEX is good but usually charges higher premiums.

I've had great luck with Provident Metals, JM Bullion, and Monarch Precious Metals.

Clarice
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Re: Gold

Post by Clarice » Sat Nov 10, 2018 6:59 pm

I had a positive experience with kitco.com. I would stick to American Eagles - easiest to unload (personal experience).

Scott 2
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Re: Gold

Post by Scott 2 » Sat Nov 10, 2018 8:57 pm

Physical gold interests me, but between shipping, storage and spread, I've never been able to justify holding it. A 10oz gold bar is about $13k and would be easy to walk out of your house with. Security is a concern IMO.

Definitely consider your exit strategy before buying. Either you are shipping to a big retailer or you need to find someone local to sell to. Either way, that adds to transaction costs. Bars may require an assay on sale, which could make them harder to unload. That is why people favor bullion like eagles, despite the premium over spot.

I bought and sold a few ounces of silver years ago, exploring the bullion owning experience, among other things. I'm glad I did that first.

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vexed87
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Re: Gold

Post by vexed87 » Mon Nov 12, 2018 8:27 am

Yes you do really need to think about your liquidation strategy, for a time I rigidly stuck with physical bullion due to counterparty risk. In my experience, those prepared to hold gold long term are holding physical to avoid financial market risks, and the counterparty risk that goes with bank security boxes/broker storage just doesn't make sense to me in that market failure scenario. Yet paper gold has the added liquidity. Someone with $5k in bullion will have to think very differently to someone with $500k.

I vowed never to raid my savings, and never naively never expected to have to rebalance my gold allocation, I could always shift cash around to do so, but in the early days of pursuing FI, I had to liquidate my retirement savings to fund some unexpected costs, everything but the gold was sold off because it was too much hassle to sell. Paper gold, would have been advantageous should a quick rebalance be necessary. I'm in two minds about what size of paper holdings to cover such eventualities, but the counterparty risk makes me more nervous than the risk of theft.

Tell no one about home storage plans. Choose your hiding place well, unless you live in the ghetto or shout about it to all and sundry, no one should turn up actively looking for it. Bullion is small enough to store away in the tiniest of hiding places that regular home invaders wouldn't think to look.

+1 for 1oz bullion, tubes of bullion are nicely divisible, well a lot more so than 1kg bars ;)

Jean
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Re: Gold

Post by Jean » Mon Nov 12, 2018 1:35 pm

Can't you just walk in a bank and buy them?

jacob
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Re: Gold

Post by jacob » Mon Nov 12, 2018 1:39 pm

Nope, it's not like Switzerland.

Jean
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Re: Gold

Post by Jean » Mon Nov 12, 2018 1:47 pm

Is it forbiden, or just too dangerous for the banks?

Scott 2
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Re: Gold

Post by Scott 2 » Mon Nov 12, 2018 3:40 pm

In the US, buying / selling physical in person, you go to a coin dealer or pawn shop. A bigger city might have a legitimate precious metals dealer. More commonly - the places that specialize in buying precious metals are predatory. You can also try for person to person transactions, meeting in the parking lot of a police station or bank. Increasing certainty on your side of the transaction comes at the price of an increased spread.

I think a lot of people go with buying / selling from a big exchange like Kitco or Ampex. Selling involves shipping via some insured and tracked method, like registered mail via the post office. These bigger dealers may also offer an option to hold the physical for you, for a fee.

There are reporting limits for large transactions. Designed to prevent money laundering, it means the government might know what you are holding, if you don't avoid those limits. This is of concern for those who are hedging against unstable government. Some like to refer back to the early 30's, when the US seized gold in an effort to stabilize the monetary system.

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Kriegsspiel
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Re: Gold

Post by Kriegsspiel » Mon Nov 12, 2018 5:14 pm

goldmart.com and coloradogold.com are other sites to consider.

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Lillailler
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Re: Gold

Post by Lillailler » Tue Nov 13, 2018 3:49 am

This touches on an issue which bothers me a bit, why invest in gold?
On the one hand there is the 'technical ' view, that the price of gold goes up and down to some extent in the opposite direction to bonds and shares, so it can smooth out ups and downs in total portfolio value, but there are several things on the other hand. First, gold doesn't generate income, you have to sell to realise any gains, then there are always transaction costs, which are higher with physical gold than paper gold (ETFs), and also storage costs, and risks of fraud and robbery, and 'lumpiness': a standard bullion bar is around 50k USD, a 1 oz coin 1k USD, so small holdings and small adjustments are awkward.

There is the 'preppers' view that there is some risk our current financial system will collapse, and once more we will revert to physical gold as the day-to-day currency, or at least as the reference value backing paper or crypto money (*). It makes sense to buy gold in this view because as the government deficit grows, and consumer lending grows, and asset prices rise in the bubble, so does the risk of catastrophic systemic failure rise and therefore the value of gold to 'preppers' and this drags up the market price of gold (**). Or it would drag the price up if governments weren't desperately trying to keep the price down, allegedly.

My point is, if gold rises when systemic risk increases, how can I rationally take profits? There is no income from gold, so in order to take a profit I have to sell, but how does it make sense to sell your defence in the case of catastrophe, when the risk of catastrophe has gone up? So, then, what is the point of investing in an asset that produces no income but you cannot rationally sell to take a profit? Or are we staking everything on the old saying that the market always overreacts?

* We have several examples of economic collapse to study, right now in Venezuela, we can think also of Zimbabwe, Argentina, former Yugoslavia, former Soviet Russia, West Germany between the surrender and the 'bonfire of controls', the Weimar inflation, etc etc. My knowledge of these episodes is limited, but I'm not sure that the re-emergence of gold as day-to-day currency is a theme. I thought it was more that tobacco / cigarettes, and whisky / vodka became currency. Also, I don't know if holders of 'paper' assets survived these periods. I suppose in East Germany they were wiped out, and some West German shareholders were expropriated wholly or partly, and there was no scope for paper assets in the Soviet Union or Yugoslavia, but in the other cases, presumably business of various sizes continued to trade, and it would be useful to know if there was continuity of ownership. To the extent that there was, we needn't worry about our shares becoming worthless even if the currency goes down the drain and takes bonds with it.

** I have some doubts about this logic. You can't eat gold, so in a real catastrophe it wouldn't necessarily help, or rather there are other things that would be of more immediate life-saving benefit: from water purification equipment and dried food to living in a strong community of mutually supportive people to learning practical skills.

Jean
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Re: Gold

Post by Jean » Tue Nov 13, 2018 5:17 am

I see physical gold as a mean to run away, to buy so mean of transport, or start anew in a stable place. If you can't exchange your labor for food, I don't really hope I could sell my gold for it in the same situation.

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daylen
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Re: Gold

Post by daylen » Tue Nov 13, 2018 8:59 am

+1 Jean Probably best to stick with storing essentials (food, water, tools). If you like to craft things, then maybe build a few high precision, non-electrical measuring instruments; something like this will hold value and always have some potential use.

jennypenny
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Re: Gold

Post by jennypenny » Tue Nov 13, 2018 10:56 am

Gold jewelry is an alternative.

prognastat
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Re: Gold

Post by prognastat » Tue Nov 13, 2018 11:08 am

Too bad I dislike the way gold jewellery looks. It just looks gauche to me. I much prefer silver's appearance. I guess for those that feel similar about gold jewellery you could just keep it locked away, but at that point what's the point in having it in an inconvenient shape such as jewellery.

As far as actual emergency use I agree with the sentiment that gold hasn't shown to be useful in the event of actual collapse. It might eventually, but it's unlikely to improve your chances getting through the collapse itself. It might be useful as a store of wealth that will have value after the collapse has been recovered from though. Another situation where it might be useful is if the collapse is localised and you manage to escape with your gold to somewhere stable it might be useful, but the question is during a collapse will you be able to escape safely with your gold without it being stolen or confiscated.

Making it through the collapse itself I would say things such as food, water, tools and skills are far more useful.

In a portfolio it might smooth it out, but that's not something I'm very interested in at this time.

Mister Imperceptible
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Re: Gold

Post by Mister Imperceptible » Tue Nov 13, 2018 2:01 pm

As a US-based investor, I wouldn’t be trying to sneak anywhere else with hidden gold. The US dollar doesn’t have to be worthless overnight for gold to be profitable, it just has to deteriorate over time. And it has done that. Since Nixon ended the gold standard with gold at $35/oz, it has served to diversify portfolios.

I see gold beneficial not just in how it behaves in an uncorrelated way- it is qualitatively different.

The financial system crashed, and stocks and bonds are trading at a fraction of their former value?....That’s fine, I have plenty of gold.

I am at liability for something (criminal negligence/involuntary manslaughter/future ex-wife decides settlement and alimony is not enough and wants my kidneys and all future cashflows)?....what gold, where? I don’t own any gold, never have, and cannot produce it for you, even if I hypothetically knew where it was, and no I do not plan to liquidate my holdings one coin per month to sustain myself while living in my RV or at my new girlfriend’s place. As far as you are concerned I am homeless and I have no assets. :D

*****

I recommend establishing a relationship with at least one coin dealer with whom you can buy AND sell WITHOUT exchanging forms and paperwork.....and if you have more than one dealer, each can verify authenticity of what the other sells you.

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