Buying Gold In NZ

[deanbo]

What is a safe way to do it? Or should I say how many gold brokers actually keep their for sale gold on site and can safekeep it for you?

[GTM 3442]

If I was buying gold, I would keep it myself. Ray Smith/Goldcorp provides an example of how "safekeep it for you" can go wrong.

[Dubdee]

Most gold is traded unallocated given the high cost of fabricating into bars coins etc. This is paper gold and only as good as the counterparty. I would get the physical and put it in the garden but it does involve paying the premium for fabrication.

[skid]

I think N Z Mint is 6-7% over spot.. also 20-30 1oz gold coins dont take up alot of space It doesnt take a whole lot of imagination to find a spot to hide that amount where noone would think to look,[as long as it looks like junk]

[airedale]

A one ounce gold bar, {say NZ$ 1800} is not much bigger than a credit card and smaller than a mobile phone. You should be able to hide a dozen of those around the place. There is $20,000 taken care of.

[Dubdee]

There are some great horror stories about holding gold.

I used to trade gold some years ago, arbitraging the SFE gold futures contract against physical. I had a client Bank of America who had done the arbitrage buying Physical from perth Mint, selling futures. There was a big crash in price (US$220 down over night) and SFE panic made the SFE price lower than the world. A great deal to unwind the trade and amplify cash and carry profit. It involved selling spot gold from BA and buying back the SFE futures. My conversation with BA" can you advise us of the location of the bars ( normally 400Oz) and their numbers fine weights etc. BA reply "must get those detail from Perth Mint" . BA to Perth Mint " can you supply us with the detail of the bars we bought?" Perth Mint : " What!!!!!! you werent supposed to need those until September (delivery date of SFE contract) We dont have any.!" BA: "but we have sold them to Michell (my company)".

To cut a long story short the gold duly arrived in kilo bars, bags of granulated gold etc. So the moral of the story is possession is the only proof it exists and there are no certificates of title (but thats another story). Most of the gold market exists on paper only and I would not want to bet that the paper position world widematches actual physical holdings. Derivatives I suspect are an order of magnitude higher.


Ray Smith did the same. Worked oin the assumption than no client would want the physical so his position was largely on paper

[GTM 3442]

Ray Smith did the same. Worked on the assumption than no client would want the physical so his position was largely on paper

And eventually, in the absence of any way of people proving that they owned a particular bar/ingot/whatever, the people lost their gold to the Banks.