Does anyone do GOLD?

[WizeOne]

I have one question. When buying non-numismatic gold like Credit Suisse bars, American Gold Eagles, etc etc, what is the margin. In other words if I bought 10K worth of gold, what typically would I be able to turn right around and sell it back for?

I know that with buying and selling numismatic gold, there is a huge margin and the price someone/dealers is willing to buy it back for is extremely subjective.

 

[JB]

Re: Does anyone do GOLD?

I think a transaction in bullion involves a trading fee as well as selling for the spot on Wall Street. The only profit I see is after you have held it until the spot is well above what you paid for it.

I would not bet gold to spot higher than its present for a long time.

 

[mscher]

Re: Does anyone do GOLD?

Too rich for my blood, but I believe, when you buy physical gold, you have to pay sales tax on the transaction, at least in some states.

 

[WizeOne]

Re: Does anyone do GOLD?

Both interesting responses. I would not buy gold to turn around and sell it immediately. I just used the scenario to illustrate my question about the 'sales margin', ie, the buy vs sell price.

As for the sales tax, that will take some looking into. That would certainly add to the margin if you had to pay it on the buy but did not receive credit for it on the sell.

I do know that 'dealers' will issue you a 1099 form when you sell the gold to them.

 

[Tim Frank]

Re: Does anyone do GOLD?

With all due respect, when someone opens a thread asking about buying "non-numismatic gold" and immediately references American Gold Eagles, all I can think is that as kindly as possible I should suggest that they :
1) look up the definition of the word "non-numismatic" (or "numismatic")
2) look for a different investment and do some more homework.

The Eagles are by definition a numismatic item.
As JB suggests, buying gold (non-numismatic) in any market that I have ever seen is a straight transaction and you pay a fee or commission to the brokerage or agent based on transaction value. That's it.
If you buy a gold bar, you own it, and can sell it. Simple.
Your IRS (or state tax guys) may take a different view from our CCA, but in either country the tax implications are probably way more of an issue than fees/commissions.

 

[WizeOne]

Re: Does anyone do GOLD?

....The Eagles are by definition a numismatic item....

The last I checked American Eagles, inspite of the fact that they have a face value and are legal tender, were basically sold at commodity prices and not considered collectors pieces.

In addition to that, I did not try to represent myself as any kind of authority on the subject , that is why I asked preliminary questions here.

My questions were valid and your comments were not helpful!

 

[roscoe]

Re: Does anyone do GOLD?

Last I recall, millions of people took a bath (loss) on gold, 30 years ago.
It took until last year to get the price back to where it was. But the people advertising gold, only want to talk about the last 8 or 10 years.

For people that have lots of money, and think they will always have security with gold, they had better think twice if they think they will be able to spend it if another "great depression " hits. To me, it sounds like the surest way to lose it. I figure the gov't will enact emergency powers and take it away from you if times get bad enough.

 

[TilliamWe]

Re: Does anyone do GOLD?

Interesting thread. I know nothing of gold, except that when you smash your finger in between two bars, it hurts! Some customer of a local bank ordered 40lbs of gold bars last year, and we picked it up at the Federal Reserve. I smashed my finger unloading it!

 

[rainman99]

Re: Does anyone do GOLD?

The last I checked American Eagles, in spite of the fact that they have a face value and are legal tender, were basically sold at commodity prices and not considered collectors pieces.

Not meaning to be a smart A_ _ here. (But) I'm shocked to fine out my collection of golden eagles are not considered collector pieces. Basically collectors buy these coins not investors. You think a collector would sell a MS70 Eagle for commodity price(LOL) coins are not just valued buy there metal content but also by there grade, age, and mint numbers. As for your question I asked one of my coin dealer buddies why everyone wants to buy gold when its at a all time high. He told me that he will buy under spot price and sell it for a profit. Unless you can do the same thing it is not a good investment right now. Like with most investment you are better off buying when its low and selling when its high. Most investors are taking advantage of low prices of stock and real estate.

 

[rbh]

Re: Does anyone do GOLD?

Never bought it, but dug it out of the ground and panned it, probably should have bought it as it would have been cheaper than that trip into the woods.

 

[Capt Craig]

Re: Does anyone do GOLD?

Selling coins at market price versus as a collector coin happens all to often. These local travelling gold/silver buying groups have made a killing recently.

Unsuspecting individuals are taken advantage of all to often. A local news piece reported that recently a woman sold an 1881 Double Eagle $20 gold piece for $1100 gold value on the market that day. The coin was said to be in very fine condition (of course we don't know who classified it as that). Depending on the reference source, mine is the 2007 Blackbook of US Coins, that should have gone at $3600.

People who don't know, sell at the market price.

 

[Huron Angler]

Re: Does anyone do GOLD?

From what I've read you can expect to pay 2-4% or "points" above spot price when buying from a dealer. A cheaper way to invest in gold is to look into gold ETF's(exchange-traded funds) that hold bullion in trust for investor's that buy shares.

A typical expense ratio for one of these is around 0.5% annually. They trade in high volume(over ten million shares/day) so the spread is narrow, meaning if you were to buy it and sell right away you'd only lose the commission and about .01/share.

I agree with Roscoe that the gov't may sieze gold in the future...it's happened before and history tends to repeat itself from lack of study

 

[skargo]

Re: Does anyone do GOLD?

I don't understand the "buy high" mindset.

 

[rainman99]

Re: Does anyone do GOLD?

Good point about the govt. and gold. Just wonder how many people think Fort Knox is still filled with Gold.

 

[JB]

Re: Does anyone do GOLD?

There is a myth that the gold is gone from Ft. Knox. Not true.

Watched a recent Discovery Channel special about Ft. Knox. There is a huge pile of ingots there. Rooms full.

I think the myth comes from the fact that the gold is sort of collateral for our huge national debt.

 

[rbh]

Re: Does anyone do GOLD?

As national dept goes up so does the price of gold, Hmmm

 

[rainman99]

Re: Does anyone do GOLD?

There is a myth that the gold is gone from Ft. Knox. Not true.

Watched a recent Discovery Channel special about Ft. Knox. There is a huge pile of ingots there. Rooms full.

I think the myth comes from the fact that the gold is sort of collateral for our huge national debt.

Those were old pictures. The only access to the vault is buy the treasury department auditors. There has not been any out side audit since JFK. Ron Paul had put a motion to congress a year ago for a outside audit. Were still waiting.

 

[slia67]

Re: Does anyone do GOLD?

Here's a thought for you WizeOne,

Gold as a commodity is priced in dollars. Our dollar has lost ground in the global economy lately (devalued daollar). When the dollar begins to rise against the Euro and other foreign currencies, the price of gold is most likely to fall or become stagnant at best.

Disclaimer: By no means should this be taken as advice, just something to think about.

 

[Capt Craig]

Re: Does anyone do GOLD?

I agree with Roscoe that the gov't may sieze gold in the future...it's happened before and history tends to repeat itself from lack of study

The government could request that everyone turn in their gold. They have no ability to go home to home and search for it or force you to turn it over. Whether you store it in a bank safe deposit box or a home safe, you r gold will always be your gold.

 

[WizeOne]

Re: Does anyone do GOLD?

The government could request that everyone turn in their gold. They have no ability to go home to home and search for it or force you to turn it over. Whether you store it in a bank safe deposit box or a home safe, you r gold will always be your gold.

The problem with that is that if it once again came to pass, it would destroy the market for gold. There would be nothing you could do with it without running the same risk as selling tax free cigarettes!