Worried Wealthy People Buying 100 Ounce Gold Bars (Worth Nearly $100,000 Each Right Now)
March 8th, 2009WARNING: This is not a recommendation to buy, sell or hold any financial instrument.
Yes, keep some physical metal close by, but also keep some far away. Consider liquidity when you want to sell. Is someone going to be making an efficient market for random 100 ounce gold bars where you are when you decide to sell?
I’m a BullionVault client and affiliate. Cryptogon readers are holding about US$2 million worth of gold with BullionVault. When you buy gold through BullionVault, you’re buying Good Delivery gold. This is the form of gold that is traded in the spot market, the most liquid physical gold market of them all.
BullionVault allows you to buy or sell virtually any amount of physical gold that you want, 24 hours per day (larger spreads on weekends, of course).
I’d suggest keeping the gold that you’re holding in your physical possession as very liquid 1 ounce sized coins (Krugerrands, Maple Leaves, American Eagles, Kiwis, etc.).
Via: Newsweek:
A hundred-ounce gold bar, when you hold it in your hand, is surprisingly small and even more surprisingly heavy. It’s somewhat longer and fatter than a Hershey bar, but it weighs six-plus pounds—as much as your old calculus textbook. Its color is unforgettable. Pure gold is gold. It’s not like your wedding ring or your grandmother’s bracelet. It’s a deep, dense yellow, the way the ocean is deep blue, and it sparkles. You can understand at last why the Bible says the streets of heaven are paved with it.
On the day I held the gold bar in my hand, it was worth nearly $100,000. My companion—an established, accomplished, affluent businessman of retirement age—had bought it as a hedge against the sinking Dow and his fear that Obama’s stimulus package will inevitably trigger wild inflation. We had picked it up in the basement of an HSBC bank branch in midtown Manhattan. When I handed it back to him, he put it in his briefcase. We went upstairs, past guards, through metal doors. Out on the street, we said goodbye and I watched him go, a tall, thin man carrying a $100,000 briefcase. He doesn’t want me to tell you his name—or, really, anything about him—because he’s keeping the gold in a safe in his basement. His friends, he says, are doing the same thing. “There is an increase in the number of wise, reasonable, well-read, well-intentioned people who are buying some gold and putting it aside,” says Dennis Gartman, editor of The Gartman Letter, a daily analysis of financial news.
John Wynocker, a hydraulics inspector, lives in Cincinnati and has been buying gold and silver coins and bars for 15 years, but since the passage of Obama’s stimulus bill, he has been motivated to buy more. He is hiding the precious metal in places where not even he can find it, he jokes. Are you burying it? I ask. “Perhaps,” he says. “Our country is so far in debt, it’s staggering. I’d like to retire someday. What else am I going to do to protect myself?”
Is this madness? Here is a respectable and buttoned-down suburbanite, behaving like an end-of-the world paranoiac. Here is Wynocker, a working man, trying to get a grip on his own financial future with a shovel.
