Anyone ever buy gold or silver?
 

So the other day for no reason (maybe from hearing how Gold hit a new 16 year high the other day) I decided to research physically purchasing gold/silver/platinum online.

Turned out to be fairly interesting since the price moves daily, and generally does not move in lockstep with the stock market. So originally I thought of it as a nice portfolio hedge. (also good against a weak dollar).

Next I figured out, that basically if you buy gold ($570ish an ounce) you could simply stick a coin in your safe deposit box and it will obviously appreciate with the market, and the IRS, wife, loan-shark and whomever is none the wiser. A platinum coin is worth $1200 ish and you could put a million dollars with in a shoe-box. For some on these boards that quality in an investment might be desirable.

Lastly, I physically went to a coin shop today and purchased some silver coins (US Double Eagle 1oz. Silver dollars) for the first time. (Not enough cash to buy gold and turns out they don't take credit cards). The interesting thing there is that 1oz gold eagles for example at this particular shop sell for $25 over what the daily price is for 1oz. of gold. The shop will buy the same coin back for $5 over the daily price. What this means is that the coins are incredibly liquid and the value is determined by the market (not by how well you can haggle).

Anyhow, just thought it was interesting and that some of you might think so as well.

Those $25 are the dealers profit why should shop around for the lowest premium when buying bullion coins or bars.

An alternative if you plan on buying small quantities and don't want to worry about storing them is e-gold.

e-gold has an awful lot of government agencies sniffing around them right now. Plus, online gold accounts lack the anomynity of a shoebox under your bed. But they do have an interesting model.

fyi, buying physical gold online is pretty worthless due to the shipping insurance price markup. Unless you're buying in huge volume you're gonna wind up paying someone a commission. But hell, you pay a commission for every other investment (stocks, mutual funds, etc.) so it's not like it's a new thing.

I watch eBay and when I see a gold bulion coin close to the end of an auction and it is much lower than the current gold price I buy it.

I then melt it down and make jewelry items that I sell on eBay and generate on average over 100% markup in a week. I only do this as a hobby mind you.

Hmmm, gold bars as tax write-off, I actually need them as a stand for my monitor. So they're a urgent business expense, I can't work without them!!!!

















Don't know if the IRS would eat that?

Well you know an interesting tax write-off idea. You know you can imprint swag with your logo and give it away as a promotional expense sidestepping the IRS $30 gift maximum. Well, what if you get some 1oz. gold bars and have your logo stamped on them as promo swag that you "give away".

Nah, that'd probably put you in jail I suppose.

Its NOT a good investment, the only person usually making money is the one selling it to you. Generally when selling you will get about 97.5% of melt and thats from volume dealers who can afford to work on a small mark up. :2 cents:

it is good to diversify these days and gold is a safe bet

a proper hedging strategy using options/LEAPS playing the indices is probably just as safe, if not safer. hit me up on icq if this is something you're interested in, but not sure how to proceed. not gonna write a mini-novel here on the subject unless someone is actually interested. :thumbsup