How to Buy Gold

By Madeline C. Gerwick

Updated on 12 August 2011

First of all, I often hear people say that they have no money to buy gold, when they own stocks and bonds. If that’s you, call your broker now and sell those items that haven’t made at least 49% in the past year. That’s how much gold made, so why take less? And it will earn a lot more next year.

Everyone has different circumstances and risk levels, so choose the situation that works best for you. The best way to buy gold is to buy real, gold coins and have them in your possession. (More on where to store them shortly). To do this, look in the yellow pages for Coin Dealers or Google them. Once you find out who’s near you, call all the shops within the same hour, and get pricing and availability for the amount of gold you want to purchase. Choose the shop with the best pricing and availability. Also determine with whom you feel comfortable working. You want to develop a relationship with this shop. You’ll use them to buy and sell over time.

Tell the dealer you want to purchase standard Gold Eagles, Gold Maple Leafs (from Canada), Kruggerands, etc. Don’t get numismatic coins, which are based on rarity, high quality, and other intangibles. Buy standard coins, which are a known value and quantity of gold, and they’re bought and sold based on weight. Typically gold coins are sold for the spot price plus a small percentage, such as 7 – 8%. This is the price of coins.

Notice that most coin dealers accept only cash or cashier checks. There are plenty of good reasons for this, not the least of which is that most of these dealers work on very slim margins. Taking a debit card would eat up half of it. And you can be certain that no dealer in his right mind is going to trade a paper check for gold. So before you go buy gold, get some cash from your bank or investment firm. This can take a day or two, depending on your bank and the amount you want. Be careful not to take out $10,000 at any one time or your bank will report you. If you purchase $10,000 or more of gold, then the dealer is required to report you to the government, though some do not.

If you develop a relationship with a dealer, sometimes they will allow you to pay for the gold with a check and then pick up the gold after the check clears. They will usually even lock in the price. I don’t advise asking for this until you know a dealer and have done some business with them. Some dealers will accept a certified check, but they usually want it to clear before they give you the gold, because even some certified checks have been faked.

Doug Casey talks about the coming greater depression

Buying Gold Online

You can also buy gold online, and they will usually want you to wire the funds to them. That’s another way to do it. The disadvantage to buying gold this way is that while you’re waiting for them to get your funds and process your transaction, which can take a few days, the price of gold is going up. Plus you will have to pay shipping and tracking.

It can certainly be done relatively easily though.

In the past, I have also mentioned that you can buy gold Exchange–Traded Funds, also known as ETFs. As far as I know, there are three recognized gold ETFs: GLD, IAU and SGOL, a recent one from Switzerland. The beauty of these products is that you can easily buy them for your IRA or 401K. However, now that we are closer to when the dollar is more likely to crash, I do NOT recommend these vehicles any longer. It’s hard to know if the funds (and the gold) would be available should a large number of sellers show up at once. The disadvantage of these products is that you don’t have the gold in your possession and for that reason, you can’t be 100% sure what’s really there. Maybe there really are gold bars to back up those shares. Let’s all hope!

OK, I Have Some Gold. Now What?

Storing gold is a cinch. No I don’t recommend getting a bank deposit box for it. If you have one already, go ahead and use it. One of the great advantages of gold is that $50,000 or $60,000 of it can easily fit into your hand. This means you can easily hide it in about a zillion places in your home. Some of the more clever ideas I’ve seen include putting it in a small metal container and hiding it in the pantry. One client cleaned out an old paint can and hid her gold in that, storing it in the garage with the rest of her paint. Also remember that something in plain sight is rarely seen. One client used a fabric covered box, which sat on the floor of her office with a wooden animal on top. No one ever looked inside and it was completely visible. There are many ways to safely hide gold in a home or office.

I’ve also been asked about three other concerns. One is how do you use the gold, once you own it? When you’re ready to purchase something, take the gold to the gold dealer and sell it. Depending on the amount, you can usually get cash immediately. If it’s a lot, they may give you a check or a cashier’s check. Gold is very liquid and can be sold immediately, 6 days per week. When you sell gold, you will usually be given spot price for it. Basically, you are preserving your wealth when you buy gold. If the value of the dollar drops by 30%, then you will gain that back and probably more. Gold is a way to preserve your wealth when paper currencies are failing.

I’ve also been asked about why I would buy gold when the price is so high. Actually, it’s not that high at the moment I’m writing this. Depending on how you calculate inflation (the government’s new or old methods), then the inflation-adjusted high of 1980, when gold was $850, has still not been reached. To reach that level, gold would have to be priced between $2350 and $3000. But once it reaches that level, that’s only the beginning.

Why is that? Because in the entire history of the world, there has NEVER been a successful currency that wasn’t backed by gold or another metal. So we can be absolutely certain that our US dollar will crash. When it does, we’re likely to see gold revalued greatly, as the government will be forced to back our currency with gold again.

Before that happens though, really big institutions will begin to buy gold and they will want physical gold. So there will be a high demand for gold by large companies, pensions, municipals, etc, and that demand will push the price of gold a lot higher. So what is the potential value for gold? The lowest I have heard is $5000 per ounce. Many come in around $6,000 – $8,000 or $9,000 per ounce. Egon von Greyerz, the founder of Matterhorn Asset Management in Switzerland, believes it will go to at between $6000 – $12,000 in today’s dollars. However he also points out that we won’t have today’s money and there may be many zeros after those estimates. Below is a video of him being interviewed by one of our American gold experts, James Turk. I highly recommend watching this video and understanding what is happening to currencies.

The last concern I’m asked about is will the government confiscate gold again? Well of course they could try. Notice that last word though. When they did this back in the 1930s, citizens used to trust the government. I think that went out with the 1960s. I cannot think of anyone I know who trusts the government, unless perhaps they’re demented and can’t remember that they don’t trust the government.

When this occurred in the 1930s, people voluntarily turned in their gold for $20 (the going rate back then for an ounce of gold). Some people kept their gold though and at that time, they were prohibited from buying and selling gold, at least in an open market. People are too sophisticated today. They would take their gold coins across the border and sell them or sell them on a black market, where of course they would get a lot more money for them. This time if the government wants the gold, it will have to pay market price in order to get it. And that alone will drive up the value of gold.

Lastly, between 2000 and 2010, ALL currencies and all stock markets have devalued over 80% against the price of gold. Less than 1% of all financial assets in the world are gold. Even without big buyers, gold has increased 5-6 times (depending on the currency) in the past 11 years. Essentially, if your stocks and bonds have not made you at least 45 – 50% in the past year, then you’re losing money. Isn’t it time you preserved your wealth instead of letting it dissolve in value? If so, get gold coins today.

Below are gold and bullion dealers recommended by the supporters of GATA. In my area, I recommend Odyssey Coin and Collectibles in Everett WA, 800-801-4061. In Seattle I recommend Seattle Coin Shop, 206-448-2646.

GATA RECOMMENDED GOLD & BULLION DEALERS

Coin and precious metals dealers who have supported GATA and been recommended by our supporters:

Amsterdamgold.com
Herengracht 574
1017 CJ Amsterdam, The Netherlands
+31 (0) 20 521 9424
Fax: +31 (0) 20 521 9333
sales@amsterdamgold.com
http://www.amsterdamgold.com

Anglo Far-East Bullion Co.
Level 23, Monticello, Anastasio Ruiz N
Panama City, Panama
Contact: Alex Stanczyk
+1-206-905-9961
newclients@anglofareast.com
http://www.anglofareast.com

Blanchard & Co. Inc.
909 Poydras St., Suite 1900
New Orleans, Louisiana 70112
888-413-4653
http://www.blanchardonline.com

Bullion Custodial Services Inc.
280-60 Renfrew Drive
Markham, Ontario L3R 0E1, Canada
Rob Kirby, Sales Agent
rkirby@kirbyanalytics.com
416-233-5784
http://www.KirbyAnalytics.com

Centennial Precious Metals
Box 460009
Denver, Colorado 80246-0009
1-800-869-5115
Michael Kosares, Proprietor
cpm@usagold.com
http://www.USAGOLD.com

Colorado Gold
222 South 5th St.
Montrose, Colorado 81401
Don Stott, Proprietor
1-888-786-8822
Gold@gwe.net
http://www.ColoradoGold.com

El Dorado Discount Gold
13014 N. Dale Mabry Highway
Suite 133
Tampa, Florida 33618
623-643-8785
Contact: Steve Forehand
steve@eldoradogold.net
http://www.eldoradogold.net

Goldcore
63 Fitzwilliam Square
Dublin 2, Ireland
+353 (0)1-632-5010
… and …
No. 1 Cornhill
London EC3V 3ND, England
+44 (0)203-086-9200
Mark.OByrne@goldcore.com
http://www.goldcore.com

GoldDrivers.com Inc.
Emancipatie Boulevard 29
Willemstad, Curacao
Netherlands Antilles
Contact: Eric Hommelberg
+599-9-7341178
ehommelberg@golddrivers.com
http://www.golddrivers.com

GoldMoney
Net Transactions Ltd.
1st Floor
32 Commercial St.
St Helier, Jersey JE2 3RU
British Channel Islands (UK)
Tel: +44-1534-633-933
http://GoldMoney.com

Investment Rarities Inc.
7850 Metro Parkway
Minneapolis, Minnesota 55425
Greg Westgaard, Sales Manager
1-800-328-1860, Ext. 8889
gwestgaard@investmentrarities.com
http://www.gloomdoom.com

Jaxville Gold and Silver Trading Co.
4901-48 St.
Parkland Square, Lower Mall
Red Deer, Alberta, Canada
Jack Fortin, Owner and Operator
403-346-5266
auric@telus.net
http://www.jaxville.com

JH Mint
13241 Grass Valley Ave.
Grass Valley, California 95945
530-273-8175
silver_support@vzw.blackberry.net

Kitco
178 West Service Road
Champlain, N.Y. 12919
Toll Free:1-877-775-4826
Fax: 518-298-3457
and…
620 Cathcart, Suite 900
Montreal, Quebec H3B 1M1
Canada
Toll-free:1-800-363-7053
Fax: 514-875-6484
http://www.kitco.com

Lee Certified Coins
P.O. Box 1045
454 Daniel Webster Highway
Merrimack, New Hampshire 03054
Ed Lee, Proprietor
1-800-835-6000
leecoins@aol.com
http://www.certifiedcoins.com

Liberty Coin Service
Bank of America Building
Frandor Shopping Center
300 Frandor Ave.
Lansing, Michigan 48912
Patrick A. Heller, Owner
path@libertycoinservice.com
Contact: Allan Beegle or Tom Coulson
allanb@libertycoinservice.com
800-933-4720 or 517-351-4720
http://www.libertycoinservice.com

MRCS Canada
12303-118 Ave. NW
Edmonton, Alberta T5L 2K2 Canada
Michael Riedel, Proprietor
1-877-TRY-MRCS
1-877-879-6727
mrcscanada@shaw.ca
http://www.mrcscanada.com

Miles Franklin Ltd.
801 Twelve Oaks Center Drive
Suite 834
Wayzata, MN 55391
1-800-822-8080
Contacts: David Schectman,
Andy Schectman, and Bob Sichel
http://www.milesfranklin.com

Missouri Coin Co.
11742 Manchester Road
St. Louis, MO 63131-4614
info@mocoin.com
314-965-9797
1-800-280-9797
http://www.mocoin.com

Northwest Territorial Mint
2505 S. 320th St.
Federal Way, Washington 98003
1-800-344-6468
bullioninfo@NWTMint.com
http://bullion.NWTMint.com

Precious Metals International Ltd.
Anderson Square Building, 3rd Floor
George Town, Grand Cayman
P.O. Box 866
Cayman Islands, British West Indies
Proprietor: Richard S. Love
http://www.PMILimited.com
PMI@PMILimited.com
Toll-free: 866-764-2878
Local: 242-394-5527

Resource Consultants Inc.
6139 South Rural Road
Suite 103
Tempe, Arizona 85283-2929
Pat Gorman, Proprietor
1-800-494-4149, 480-820-5877
Metalguys@aol.com
http://www.buysilvernow.com

Royal Crown Precious Metals Ltd.
Suite 1500, HSBC Building
885 West Georgia St.
Vancouver, British Columbia V6C 3E8
Canada
Andreas Runge, President
Toll-free: 866-769-2521
604-639-2150
Info@royalcrownmetals.com
http://www.RoyalCrownMetals.com

Scottsdale Silver & Gold
20701 North Scottsdale Road
Suite 107-266
Scottsdale, Arizona 85255
1-888-SIL-BARZ or 1-888-745-2279
sales@scottsdalesilver.com
http://www.ScottsdaleSilver.com

Seekbullion Gold and Silver Auctions
8420 S. Continental Divide Road
Suite 221
Littleton, Colorado 80127
Peter Spina, Owner
PeterSpina@goldseek.com
http://www.seekbullion.com

Silver Gold Bull
4819 45 Street
P.O. Box 2621
Rocky Mountain House, Alberta T4T-1L6
Canada
Contact: Mihali Belandis
416-628-3544
Sales@SilverGoldBull.com
http://www.SilverGoldBull.com

Silver Trading Co.
445 Montgomery St.
PO Box 876
Shreveport, Louisiana 71107
Larry LaBorde, Proprietor
318-470-7291
LLaBord@silvertrading.net
http://www.silvertrading.net

SprottMoney Ltd.
Royal Bank South Tower
200 Bay St.
Suite 2750, P.O. Box 90
Toronto, Ontario M5J 2J2
Canada
416-861-0775
or toll-free 888-861-0775
sales@sprottmoney.com
http://www.sprottmoney.com

Suisse Gold Corp.
#129 — 1685 H St.
Blaine, Washington 98230
Richard Oliver, Proprietor
Richard@golddealer.ca

Swiss America Trading Corp.
15018 North Tatum Blvd.
Phoenix, Arizona 85032
Dr. Fred I. Goldstein, Senior Broker
1-800-BUY-COIN
FiGoldstein@swissamerica.com
http://www.swissamerica.com

The Moneychanger
Box 178
Westpoint, Tennessee 38486
Franklin Sanders
1-888-218-9226, 931-766-6066
http://www.the-moneychanger.com

Treasure Island Coins Inc.
1002 43rd St. SW
Fargo, North Dakota 58103
701-282-4747
http://www.treasureislandcoins.com

True Metals Group
728 West Ave., Suite 1100
Cocoa, Florida 32927
Daniel and Karina Ward, Owners
866-303-0781
Sales@silver50.com
http://www.silver50.com

Worldwide Precious Metals (Canada) Ltd.
Suite 1488, 777 Hornby St.
Vancouver, British Columbia V6Z 1S4
Canada
President: John P. Downes
Toll-free: 1-866-623-2002
Local 778-945-2002
info@wwpmc.com
http://www.wwpmc.com