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Saturday, December 29, 2012

Itsy bitsy gold bars all the rage in Switzerland


itsy bitsy gold bars in Switzerland
Itsy Bitsy gold bars are all the rage in Switzerland with private investors who are keen to queue up and buy gold in the form of small credit card size bars that can be broken up into bite size chunks as emergency payments.

The Swiss refinery Valcambi, part of the U.S. mining giant Newmont, is keen to bring its bite sized "CombiBar" to, not only Switzerland, but also the United States and India, the worlds largest gold buyer. 
According to Reuters, “Investors worried that inflation and financial market turmoil will wipe out the value of their cash have poured money into gold over the past decade. Prices have gained almost 500 percent since 2001 compared to a 12 percent increase in MSCI's world equity index.”

More and more people are buying gold it seems. According to the World Gold Council, sales of gold bars and coins were reached $77 billion in 2011, up from just $3.5 billion in 2002.
"The rich are buying standard bars or have deposits of physical gold. People who have less money are buying up to 100 grams," said Michael Mesaric, CEO of Valcambi. "But for many people a pure investment product is no longer enough. They want to be able to do something with the precious metal."

Mesaric said the advantage of the "CombiBar", dubbed the "chocolate bar" because pieces can be easily broken off by hand into one gram squares, is that it can be easily transported and costs less than buying 50 one gram bars.

"The produce can also be used as an alternative method of payment," he said.
Valcambi is now building a sales network in India with plans to launch the CombiBar on the U.S. market next year.

Meanwhile in Germany demand is strong, "Above all, it's people aged between 40 and 70 that are investing in gold bars and coins," said Mesaric. "They've heard tales from their parents about wars and crises devaluing money."

Andreas Habluetzel head of the Swiss business of Degussa, a gold trading company said, “The CombiBar is particularly popular among grandparents who want to give their grandchildren a strip of gold rather than a coin and Demand is rising every week," Habluetzel continued, "In Germany, people are buying gold in the fear that the euro will break apart or that banks will run into problems."

As developments in the euro zone lurch from one crisis to another, the demand for gold that can be sold in vending machines is also growing.

"Sales rise according to the temperature of the crisis," said Thomas Geissler, whose firm Ex Oriente Lux operates 17 gold vending machines in Europe, the United States and the United Arab Emirates.
The machines saw record sales in 2010, one day after the then Deutsche Bank CEO Josef Ackermann raised doubts over whether Greece would be able to pay its debts.

Since the launch of the machines, which operate under the name "GOLD to go", 50,000 customers have withdrawn more than 21 million euros in gold. The average buyer is male, over 50 years old and well off.

"Customers are hoarding gold mostly at home as a precaution against a crisis, just as their fathers and grandfathers did before them," Geissler said.

It seems that itsy bitsy gold bars are all the rage not just in Switzerland but all over Europe and Asia for people that want to buy gold.

Reference:
http://www.reuters.com/article/2012/12/21/swiss-gold-idUSL5E8NL4N8201212...



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