Saturday, March 31, 2007

Gold Coins

Gold coins, next to silver, are one of the oldest forms of money known. The first recorded history of gold coins were those introduced by King Croesus of Lydia around 560 BC.

It is only recently, around 1933, that gold coins have stopped being used as currency. Despite this, many of the coins these days are still legal tender in the country in which they are struck.

There are many different types of gold coins and many countries produce gold coins for collectors and as an investment for people interesting in protecting themselves from variations and pressures economically

Gold coins are very popular among people who are keen to "hedge" against inflation or a store assets. The South African government introduced the Krugerrand in 1967 to cater to this very market. This was a boom to the American collector as, at that time, it was illegal for any US citizen to own gold, but owning coins of legal tender (which the Krugerrand was in South African) was not illegal. This enabled a US citizen to effectively own gold. At exactly one troy ounce. The Krugerrand was the first modern, low premium (i.e. priced only slightly above the bullion value of the gold) gold coin. Gold coins are also produced in fractions of an ounce – typically half ounce, quarter ounce, and one-tenth ounce and , recently one twentieth of an ounce. Generally speaking, gold coins do not carry a meaningful face value, as their value is determined by their troy weight and the current market price of the precious metal. Where a face value is minted on the coin, it is invariably done for legal or other reasons and it is nearly always significantly less than the actual value of the coin.

These days one can buy gold coins from most countries. The design on the coins tend to remain constant, at least on one side where a particular individual is represented. In the UK it is the Queen, In the USA, usually a president. Almost all are proof coins. This means they have been struck a number of times to give that beautiful sheen and gloss that proof coins have. Such coins should not be touched by the naked hand. If one intends to handle gold coins, especially proof ones, then very soft gloves should be used but it is advised not to handle gold coins by hand at all actually.

When you buy gold coins they should come sealed in their own transparent plastic bubble. Always check to ensure the bubble has not been tampered with and is completely sealed. The coin should not be removed from the bubble at all as this can affect not just the surface of the coin but the value as well.

The value of a gold coin is determined by a number of factors, the condition of the coin, the rarity, its age and how many were minted. As an example just 5 years ago a very rare $20 1933 Double Eagle gold coin was sold at auction for over 7.5 million dollars.

Gold coins can also be very beautiful and many people will collect them for their beauty alone.

Tuesday, March 27, 2007

Buy Bars of Gold

Why buy bars of gold? Gold bars are probably one of the best buys today. Gold has held its value over many years. with one ounce of gold you can still purchase exactly the same goods and services now as you could 20 and even 50 years ago. The same cannot be said for currency which fluctuates wildly over the years and is subject to inflation, deflation and a myriad of other influences.

Gold bars come in all shapes and size from the very small wafer thing 1 gram 'biscuits' to the heavy 400 ounce ingots, so favored in Hollywood movies. The larger bars are called ingots and are made by poring molten gold into moulds. This is called casting. The smaller bars are made by pressing gold with a hugh multi tonne stamp, much in the same way gold coins are made, and these are usually called biscuits.

All bars of gold should have stamped on them, the weight, the size and the manufacturers stamp. Also a registration number that corresponds with a certificate which should also accompany every bar.

The advantage with the smaller bars is of course convenience. They are easier to buy and sell due to the lower cost involved. Easier to store and transport. The disadvantage is the price. They carry a higher premium over the value of the gold due to the costs involved in manufacture.

The advantage with the larger bars or ingots is the premium is much lower and usually a fraction above the spot price of gold for that day. The disadvantage is that they are more difficult to move around and store due to their weight and can me more difficult to sell as there is much more funds involved in the transaction. Most of the larger ingots are stored in bank vaults around the world.

To buy bars of gold then is dependent largely on the purpose for purchase. If you are interested in storing assets in gold for the long term then the larger bars may be more suitable. If you cannot afford the large bars then perhaps you can look at a smaller bar and gradually build up with smaller 10 ounce, for example, bars which are easier stored and transported.

If price is not a consideration and you like the idea of collecting and owning gold bars the 1 ounce and smaller may fit the bill. The premium is larger and can even stretch to double the value of the gold but over time this will be recouped as the value of gold against the currency increases.

In any event, to buy bars of gold can be a lot of fun and there is nothing quite so wonderful as holding a bar of gold in your hand.

Gold Bars for Sale

Where you see gold bars for sale there is an opportunity to buy gold in an easily stored and transportable form. To do so it is good advice to know something about gold bars.

Firstly What is a gold bar? Gold bars come in a variety of forms sizes and weights. The definition of a gold bar is considered to be, 'a bar of gold made by a recognized bar manufacturer regardless of shape and size and upon which is reported the exact weight and purity of the gold as well as a registration number.

All gold is measured in troy ounces and the purity is measured in karats (not to be confused with the weight measurement of carats for diamonds). You can buy gold bars in sizes ranging from just one gram up to a weighty 400 ounces

Types of Gold Bars

There are two types of gold bars depending on the method of manufacture. Press bars, often called biscuits, and ingots. The main difference is that ingots are made by poring molten gold into a mould. This method is usually reserved for the larger bars. The smaller gold bars are pressed out in a similar fashion to gold coins and they have a better finish than the cast bars which usually have a rougher surface.

All gold bars are sold with a premium above the value of the gold at the time of the sale. The size of the premium will depend upon the size of the gold bar. The smaller the bar the higher the premium. This is due to the amount of work and cost in producing the bar which has to be factored in the price.

It is a matter of, how much can you pay when you buy gold bars.

The advantages with the larger bars is the smaller premium. 1000 Kg bars or even ten ounce gold bars carry a much smaller premium than if you were to buy a one kg biscuit. In fact the one kg bar has a premium that can outweigh the value of the gold and is not a good choice.

Also as the price of gold is rising that means, for the larger bars, the premium is less per ounce of gold as the cost production does not increase just because the price of gold does.

The advantage with the smaller bars is the less cost of shipping and the ease of storage and transport. Indeed with the one to 10 ounce bars, these can fit into a pocket or bag.

The cost of shipping is a big expense but actually the cost of the insurance is a bigger one. The larger the bar being shipped the higher the cost of insurance and this should be taken into account when you buy gold bars of any size.

Where to Buy Gold Bars
Gold bars can be purchased direct from most manufacturers and mints but also from dealers. Sometimes from online auctions.

Generally speaking it is better to buy gold bars from manufacturing mints or the larger well established dealers. Even online as most these days will have online ordering facilities.

Some points to keep in mind when you are buying gold bars online:

Make sure the mint or dealer is bona fide. There are established mints, such as the US Mint, Canadian Mint, Australian Mint, Mints in Europe and private mints.

Many will have shopping carts and facilities for you to pay by credit card so you should ensure they have a secure server. You can tell if a server is secure when you look at the address (URL) instead of starting with a http it will start with a https instead.

Is there a return address and are there contact phone numbers? Is there an 'About Us' page where you can find out who they are. The larger Mints and dealers will have a fixed address on their site.

What are the terms and conditions? Is there a returns policy of the bar looks nothing like the picture on the site or what you ordered? (Order processes can get orders wrong)

As with anything else always check, when you receive the goods, that you got what you expected and your credit card statement to ensure you were charged the correct amount. If you are ordering from overseas bear in mind there may be a currency difference as currencies change on an ongoing basis.

What to Look For in Gold Bars
All gold bars should come with a certificate that gives accurate details of the gold bar so ensure that the gold bar you order has the same. The weight, size, manufacturer and a number of the certificate should match the number stamped on the gold bar. Also it should be sealed in its own container. If not be suspicious and check it over it to ensure it has not been tampered with. With the smaller bars, unless it is sealed in the original transparent packaging as supplied by the mint it is better to return it. Of course the larger bars, such as ingots, will not come in any packaging but, if you are taking deliver, will likely come in a armored van with a heavy guard as packaging!

Gold continues to retain its value even when currency drops or fluctuates. In fact you can still buy the same value of goods and services with an ounce of gold now as you could 20 or 50 years ago. Gold was a lot cheaper to buy with currency then, but the value of an ounce has not changed. Unlike currency, the value of which has deteriorated so much that it now takes a bucket load of money to buy the same goods or services as an ounce of gold.

So provided some due diligence and a little common sense is applied there is no reason why, when you see gold bars for sale, you should not get your self a jolly good deal!

Monday, March 12, 2007

2007 Gold Bullion Sovereign

The 2007 Gold Bullion Sovereign is a delightful gold bullion coin just issued by the British Royal Mint.

The obverse carries the traditional and greatly-renowned portrait of the Queen by Ian Rank-Broadley FRBS, but the reverse is quite stunning in its image of St George slaying the dragon. This most celebrated if sovereign designs is immortalized by Benedetto Pistrucci.

In Christian hagiography (the study of saints.) Saint George (c. 275-281–303) was a soldier of the Roman Empire who was venerated as a Christian martyr. Saint George is considered one of the most venerated saints in the Eastern Orthodox Church and Oriental Orthodox Churches. Immortalized in the tale of George and the Dragon, he is the patron saint of many countries including Canada, Catalonia, England, Ethiopia, Georgia, Greece, Montenegro and Serbia,

Each Sovereign is struck in the finest quality 22 carat gold and eloquently captures every detail of the design. The polished coin is housed within a beautifully illustrated presentation card.

Issue limit: 75,000
Alloy: 22 Carat Gold
Weight: 7.99 g
Diameter: 22.05 mm
Denomination: SOV
Code: UKB07R
Price: £120.00

It is quite likely that dealers will be jumping in and making their bulk purchases with this coin so it would be a good idea to jump in oneself and get as many as possible before they are snapped up.

The 2007 Gold Bullion Sovereign is very likely to be a very popular coin not just for the design and beauty but also for the small size and ease with which it can be transported. A few of these coins is a convenient way to buy and sell and to transport and as required.

Sunday, March 04, 2007

PMRs Sberbank offers Solid Gold Bars

The PMR Sberbank is offering it's citizens sold gold bars from 1 gram to 500 grams (100 gram ingot shown). These are legal to hold as well as to import and export.

Sberbank (a contraction of the Russian words for "Savings Bank") is one of the largest banks in the Pridnestrovskaia Moldavskaia Respublica, or PMR for short.

Pridnestrovie declared independence in 1990 during the Soviet Union break up.. It has its own Central Bank and produces its own currency, the PMR Ruble. Several times a year, the PMR Sberbank issues gold and silver commemorative coins for numismatic purposes.

TransnistriaIn Pridnestrovie gold ownership has been fully legalized. The first local bank to offer gold is Pridnestrovie's Sberbank. The move is part of a series of sweeping reforms being enjoyed in the new and emerging country.

Sberbank's chairman Yuri Tverdokhlib stated that, " this is the first time a bank in Pridnestrovie is offering gold and silver, with the bank allowing customers to purchase precious metals on installment plans."

Initially, Sberbank will be offering gold ingots ranging from 1 gram to 500 grams. Later in the year, if there is a demand, gold bars of 1 kg will also be on sale.

"We advice citizens to diversify, and put some of their assets in precious metals," Yuri Tverdokhlib said. He also noted that gold, as well as silver, is currently in an upwards trend, with prices already having risen more than 30% in the past year.

Gold is sold by Sberbank at the international spot price, and comes with assay certification. Commission depends on amount of the transaction, but would be less than 1%, the bank reports.

The lifting of gold ownership restrictions is part of a series of reforms bringing Western-style economic freedom to this small and unrecognized country located in what was formerly a part of the Soviet Union. Because of gold's use as a reserve store of value, the possession of gold is sometimes restricted or banned. This is usually a feature of Communist countries, countries that are in war, or countries with low levels of individual economic freedom. Within the United States, the private possession of gold except as jewelry and coin collecting was banned between 1933 and 1975.

Now with the PMR Sberbank offering it's citizens sold gold bars the door is open just that bit wider for gold to be traded in the eastern Countries.

Thursday, March 01, 2007

Why Buy Gold Coins

Why buy gold coins indeed! Quite apart from a collectors viewpoint, there are several good reasons why it is prudent to buy gold coins at this time.

Kevin DeMeritt, a top gold investment advisor of Lear Financial, Inc., stated, "In this highly volatile international financial climate, gold's value, relative to most national currencies, will soar …"

The current financial international climate relative to most countries can be quite volatile. This means that there can be a very big change in currencies affected by international tensions and trade issues. Gold coins tend to remain stable during such times.

With rising oil and interest rate rates in the US, and global trade imbalances the financial market is undergoing increased instability and unpredictability. In such a highly volatile international financial climate, it is quite likely that gold's value, relative to most national currencies, will continue to increase.

Here are several sound reasons to buy gold coins.

The declining value of the dollar. Gold is bought and sold in US dollars so as the value of the dollar decreases on world markets so the value of gold appears to rise. Since the dollar has been stripped of its gold backing it is now simply a piece of paper.

With more of the dollar being 'printed' each day to shore up the declining value, inflation has contributed to the US having the biggest world debt. This is where owning gold coins becomes increasingly viable as a hedge against inflation. Gold has held its own value for over 100 years.

People have traditionally turned to gold in times of crisis. While other investments may falter and fluctuate gold remains steady and continues to increase in value.

More gold is being demanded and this is outstripping the supply. With regulations being relaxed in china, for example, one can expect a surge of gold demand over the coming years

Storing gold coins is very simple and easy. They weight, as coins, is not large and they can be hidden from thieves easily. They are easily transportable and can be sold quickly in times of need.

Gold price may fluctuate but over the long run gold has consistently proved to be an effective preserver of wealth. It has also proved to be a safe choice in times of economic and social instability.

Putting all your eggs in one basket is traditionally a poor move so any portfolio should include gold coins as a good hedge against the downward movement of shares and other financial investment vehicles. In fact the price of gold tends to increase more when other stocks drop thereby providing a good balance to the overall value of the portfolio.

Apart from the above it is also fun to collect gold coins, with the immense variety available and the striking beauty that many gold coins have, this is a good reason alone as to why buy gold coins.