Some people have been touting pre 1935 gold as a means to circumvent the confiscation of gold. I believe they want to classify this gold as a collectible numismatic variety. What is never indicated by most individuals is that the govt. taxes your collectibles (long term) for 28%. Duh, as if most of the gold bugs are going to indicate their purchase and subsequent sale of the commodity.

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StockGumshoe Reply:
February 12th, 2009 at 1:29 pm

Certainly true, I hear that a lot (these are the coins that Sjuggerud teases in his “gold glitch” ads that we see so often, too). Pre-1933 gold (like the St. Gaudens Double Eagles)is certainly not discounted compared to modern bullion coins, though some people argue that the premium is lower than it should be, or than it historically has sometimes been.

And yes, good point on taxes — I always forget to mention that. I think I’ve heard that the GLD ETF (or others backed specifically by bullion) is also taxed as a collectible, but I haven’t checked that lately. And I hope it goes without saying that I’m far from being a tax expert, so take this whole paragraph with a grain of salt (I’m banging my head on the table working on my taxes right now, the bruise is growing).

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Mark Bohana Reply:
February 12th, 2009 at 2:28 pm

GLD ETF isn’t considered a collectible, the only collectible would be something tangible, art work, bullion, etc.. What is interesting is that the govt. is so afraid of the underground economy of gold/silver that they have tried to undermine by pushing bullion to IRA’s.(where it can be controlled and accounted for) Also remember there is no velocity of money when you keep gold in a safe deposit box, and why purchase paper $$$ (fiat) with something that has value all over the world.

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Justin Reply:
February 18th, 2009 at 9:31 pm

GLD and the other precious metals ETF’s are taxed like a collectible in certain instances, and subject to a 28% tax rate. Read the prospectus here:

http://us.ishares.com/product_info/fund/overview/IAU.htm?qt=IAU

Justin Reply:
February 18th, 2009 at 9:31 pm

GLD and the other precious metals ETF’s are taxed like a collectible in certain instances, and subject to a 28% tax rate. Read the prospectus here:

http://us.ishares.com/product_info/fund/overview/IAU.htm?qt=IAU

Mark Bohana Reply:
February 12th, 2009 at 2:28 pm

GLD ETF isn’t considered a collectible, the only collectible would be something tangible, art work, bullion, etc.. What is interesting is that the govt. is so afraid of the underground economy of gold/silver that they have tried to undermine by pushing bullion to IRA’s.(where it can be controlled and accounted for) Also remember there is no velocity of money when you keep gold in a safe deposit box, and why purchase paper $$$ (fiat) with something that has value all over the world.

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Kristian Reply:
February 12th, 2009 at 5:11 pm

when I sell back precious metal to my dealer he takes my SSN and reports the sale. I am held to report the gain (if any, to the IRS). Do I remember what I bought it for, and when…

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Mark Bohana Reply:
February 12th, 2009 at 8:08 pm

I would suggest you get a new dealer, since I have used Blanchard, Mint Products, Eastern Numismatics, and presently very happy with apmex.
If you purchase locally, of which I have done at various times I also have never provided an SSN. If you purchase bullion with storage: ie: 1000 ounce silver bars, with delivery from Comex, that is an entirely different situation. If you look at firms like everbank, PFG, and quite a few brokerdealers and commodity yes you will have to supply SSN.

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Mark Bohana Reply:
February 12th, 2009 at 8:08 pm

I would suggest you get a new dealer, since I have used Blanchard, Mint Products, Eastern Numismatics, and presently very happy with apmex.
If you purchase locally, of which I have done at various times I also have never provided an SSN. If you purchase bullion with storage: ie: 1000 ounce silver bars, with delivery from Comex, that is an entirely different situation. If you look at firms like everbank, PFG, and quite a few brokerdealers and commodity yes you will have to supply SSN.

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StockGumshoe Reply:
February 12th, 2009 at 1:29 pm

Certainly true, I hear that a lot (these are the coins that Sjuggerud teases in his “gold glitch” ads that we see so often, too). Pre-1933 gold (like the St. Gaudens Double Eagles)is certainly not discounted compared to modern bullion coins, though some people argue that the premium is lower than it should be, or than it historically has sometimes been.

And yes, good point on taxes — I always forget to mention that. I think I’ve heard that the GLD ETF (or others backed specifically by bullion) is also taxed as a collectible, but I haven’t checked that lately. And I hope it goes without saying that I’m far from being a tax expert, so take this whole paragraph with a grain of salt (I’m banging my head on the table working on my taxes right now, the bruise is growing).

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Kristian Reply:
February 12th, 2009 at 5:11 pm

when I sell back precious metal to my dealer he takes my SSN and reports the sale. I am held to report the gain (if any, to the IRS). Do I remember what I bought it for, and when…

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Travis,

I think that you are right on the money in your review of Eric Roseman’s flaunt.

I believe that it is the Canadian coin.

Also, the $600.00 saving is the difference between what he says some individuals are charging on the e-bay and what the coins can be obtained for from the Canadian Mint. If you are stupid enough to pay a $600.00 premium, then Eric Roseman has a deal for you.

I check your reviews regularly.

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Right you are Travis, my brother dables in these types of coins &
the 2009 Canadian Gold Maple Leaf is indeed the coin being discussed above. I wouldn’t bet the farm that the 5% premium will continue much longer, especially with gold breaking out as it has recently.

The thinkolator can take a bow!

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I just received a flyer for the Canadian Olympic Maple Leaf coins from First Federal Coin Corp. (800-222-3891)(included in a mailing from Oxford Club?? or one of their affiliates in Baltimore). They offer the gold coins for “as low as 5% over spot” and the silver coins for “as low as $3 over spot”–minimum of ten coins. They mention a worldwide limit of 50,000 coins each year for the gold one. That makes it certain this is what was teased. Too bad for me that they have the ten coin minimum–I might have wanted one or two.

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Steve:

You are spot on with your guess I am a numismatic bug and I don’t think it will make any difference if the government wnats your gold they are going to take it. I say bury it in your yard, just don’t tell anyone where you buried it except me.

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WARNING TO ANYONE THAT IS CONSIDERING BUYING ANY FORM OF GOLD WHATSOEVER.THE IMF ARE AWAITING CONGRESS TO GIVE THEM THE GO AHEAD TO SELL 403 TONNES OF GOLD.THEY NEED TO DO THIS OWING TO ALL THE MONEY THEY HAV BEEN GIVING TO MANY BANKS THROUGHOUT THE WORLD,NEVER MIND TO THE USA BANKS ONLY.ALSO GERMANY ARE OF THE SAME MIND,THOUGH MY INFORMATION DID NOT SAY THE AMOUNT OF GOLD THEY PLAN TO SELL.OF COURSE THEY WILL HAVE TO INFORM ALL THE CENYRAL BANKS THROUGHOUT THE WORLD ASWELL.PERHAPS YE ARE NOT AWARE OF THE WAY THE CENTRAL BANKS LEASE GOLD OUT TO EACH OTHER ON THE OPEN MARKET TO SUPPRESS THE RISE IN GOLD ASWELL/GOD BLESS YE ALL.PATRICK O SULLIVAN(LIVING IN IRELAND)

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BILL MOSS Reply:
February 13th, 2009 at 1:40 am

Patrick, how much would that translate into money?
Where about’s in Ireland do you live?

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NBK Reply:
February 21st, 2009 at 5:36 pm

The gov’t's have been threatning this and many have not come through. They always do this to scare the public and or try and surpress the gold price. If they succeed, it will be short lived. The gold market is smaller than microsoft. Once this bull starts chargin, there will be no stopping until much higher prices. The key to know if GOLD is going higher is to compare LEASE rates. If lease rates are rising, the supply is falling.

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BILL MOSS Reply:
February 13th, 2009 at 1:40 am

Patrick, how much would that translate into money?
Where about’s in Ireland do you live?

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NBK Reply:
February 21st, 2009 at 5:36 pm

The gov’t's have been threatning this and many have not come through. They always do this to scare the public and or try and surpress the gold price. If they succeed, it will be short lived. The gold market is smaller than microsoft. Once this bull starts chargin, there will be no stopping until much higher prices. The key to know if GOLD is going higher is to compare LEASE rates. If lease rates are rising, the supply is falling.

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The Chinese and Arabs are net buyers of gold. The IMF may have a short term effect on gold but as long as trillions of paper keeps coming off the presses tangable items should fare well. The Aulstrailian Lunar series has 12 coins that have a max of 30,000 each but carry a high premium, espesially the year of the Dragon.

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HI again Travis and all
I see no purpose for the USG to confiscate gold now. The confiscaton in the 1930′s was a two step process based on the fact that then the dollar was pegged to gold in value. It was about 23 dollars to the ounce – then FDR took it all from people. But of course under the Constitution he had to give people their 23 bucks per ounce. Then he revalued the dollar to about 35 dollars to the ounce. Instant profit for the USG – a fund they still have and use. Absent prior confiscation devaluing the dollar would not have given the government its profit. Today the dollar is not pegged to gold. So what if the government confiscated eveyone’s gold? How can it make any money from that. It would have to sell it right back to someone. But it would have to pay for it first – ergo a wash unless the government could somehow charge more for its ounces than it had just paid.
Bottom line, the gold was not confiscated for nothing, it was paid for and the profit came in the subsequent devaluation. Today the government is devaluing the dollar daily since it is fiat money.
Folks better check on the tax consequences of selling gold in any form including an ETF – I think that is taxable at 28 percent rate.
best
john sloan

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StockGumshoe Reply:
February 12th, 2009 at 3:19 pm

Thanks John. That is indeed what was teased as the 60%+ jump in the value of gold coins overnight in the 1930s — that’s how much more gold was worth in the newly devalued dollars, at least, the gold you were still allowed to own.

And truth be told, I generally agree with you on the confiscation prospects — I suppose it could happen, but it’s hard to imagine why (or how). Then again, plenty of things have happened that I have a hard time imagining, and I have not put much effort into studying the prospect.

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StockGumshoe Reply:
February 12th, 2009 at 3:19 pm

Thanks John. That is indeed what was teased as the 60%+ jump in the value of gold coins overnight in the 1930s — that’s how much more gold was worth in the newly devalued dollars, at least, the gold you were still allowed to own.

And truth be told, I generally agree with you on the confiscation prospects — I suppose it could happen, but it’s hard to imagine why (or how). Then again, plenty of things have happened that I have a hard time imagining, and I have not put much effort into studying the prospect.

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Huh? Explain for dummies like myself, what does ‘remember there is no velocity of money when you keep gold in a safe deposit box’ mean?

Thanks,
Dan

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Velocity of Money, I give you a $100 dollars, you purchase $100 worth of food, supermarket uses that $100 to make a profit, pay employees, pay distributor for food, and on and on. Distributor pays trucking,farmers, etc.. That one dollar you have will go thru many hands, the dollar in savings at the bank will go to X 10 to loan people $$ and his trophy wife will also be able to spend on jewelry.

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Stever Reply:
February 12th, 2009 at 4:40 pm

The scary fact is that the gold you may have horded in a safe deposit box or in your mattress may one day be the only currency with velocity. As far as I can see, that is the principle reason for owning it, except of course for speculative purposes.

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Mark Bohana Reply:
February 12th, 2009 at 8:12 pm

I certainly agree, although what is of utmost concern that most people don’t recognize or realise is the problem that once gold goes to $1200++, than making change is almost impossible. Most of us that purchase gold, also purchase in one ounce coins, since the premiums are ridiculous for any smaller weights. That is the reason to certainly own silver, which I consider is only gold on steroids.

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Mark Bohana Reply:
February 12th, 2009 at 8:12 pm

I certainly agree, although what is of utmost concern that most people don’t recognize or realise is the problem that once gold goes to $1200++, than making change is almost impossible. Most of us that purchase gold, also purchase in one ounce coins, since the premiums are ridiculous for any smaller weights. That is the reason to certainly own silver, which I consider is only gold on steroids.

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Stever Reply:
February 12th, 2009 at 4:40 pm

The scary fact is that the gold you may have horded in a safe deposit box or in your mattress may one day be the only currency with velocity. As far as I can see, that is the principle reason for owning it, except of course for speculative purposes.

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First post but I felt compelled to add my 2 cents. I must admit to spending 40 minutes of my time listening to the recording they had on how to save $600 on gold with great interest only to be extremely disappointed that they would use such a lame example as someone buying it off of ebay? I made some nice profits in the late 70′s and am now sitting on a 300% profit on some gold purchased about 2000. I have purchased gold through 3 different companies in the last 9 years, one from Louisiana, one from Texas and Monex in California. Monex gave me the best pricing and service and I would never buy again from the other two since they put you on their speed dial and their premiums were much, much greater than Monex which I seem to recall was 3 or 5% – cannot recall. But getting back to Agora, they put out a lot of good, free information but in this case they really were stretching it!

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Enjoy your daily articles. Am a new kid on the street. Wondering if you have any new info on ARNA. Thanks for Gunshoe

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StockGumshoe Reply:
February 12th, 2009 at 9:58 pm

Thanks HY — I must admit, I haven’t followed it at all since I wrote about it, though the combination of more ads from S&A, the exposure it got in this space, and the conference presentation ARNA gave earlier this week all probably helped drive the price to this point, it’s certainly been a nice week for anyone who jumped right in.

I wouldn’t be at all surprised if there are plenty of chances to buy on dips in the months to come if you decide this is a stock you need to own — this first Phase III trial isn’t guaranteed to have excellent results, and there will be more news later this year, and lots of time before they can actually hit the market (if they can).

My suspicion would be that in this turbulent market, folks won’t hold on for a long wait and they may well sell off on impatience or on anything that smells disappointing (let alone anything that’s genuinely bad news). But that’s just me, and just a guess — I expect we’ll keep seeing the ads, they must be working pretty well.

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StockGumshoe Reply:
February 12th, 2009 at 9:58 pm

Thanks HY — I must admit, I haven’t followed it at all since I wrote about it, though the combination of more ads from S&A, the exposure it got in this space, and the conference presentation ARNA gave earlier this week all probably helped drive the price to this point, it’s certainly been a nice week for anyone who jumped right in.

I wouldn’t be at all surprised if there are plenty of chances to buy on dips in the months to come if you decide this is a stock you need to own — this first Phase III trial isn’t guaranteed to have excellent results, and there will be more news later this year, and lots of time before they can actually hit the market (if they can).

My suspicion would be that in this turbulent market, folks won’t hold on for a long wait and they may well sell off on impatience or on anything that smells disappointing (let alone anything that’s genuinely bad news). But that’s just me, and just a guess — I expect we’ll keep seeing the ads, they must be working pretty well.

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If gold is so valuable why are dealers taking paper money… (soon to be valueless from all the ‘advice’ I get)… for it at only a 5% ‘profit’? Somebody help me out here.

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StockGumshoe Reply:
February 12th, 2009 at 8:01 pm

Hey, they’ll be happy to buy it from you, too, for 5% less … they’re just the middlemen, they do fine no matter which way the price of gold goes, and the good ones have probably learned over the years not to bet on that direction with their own money. The gas station guy will still sell you gas at whatever the current market price is, even if he’s sure that oil is going back to $100 this summer.

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StockGumshoe Reply:
February 12th, 2009 at 8:01 pm

Hey, they’ll be happy to buy it from you, too, for 5% less … they’re just the middlemen, they do fine no matter which way the price of gold goes, and the good ones have probably learned over the years not to bet on that direction with their own money. The gas station guy will still sell you gas at whatever the current market price is, even if he’s sure that oil is going back to $100 this summer.

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I agree that silver coins, so called “junk silver” are the way to go. Everyone recognizes a dime, quarter and 50 cent piece and they can easily be used as a medium of exchange. These can easily be used for daily transactions and can be determined to be 90% silver by looking at the edge. Selling gold back to a dealer can be very costly and will probably be reported to the government. You might also want to check out CEF, a Canadian silver/gold ETF, which might be a bit harder for “Uncle” to confiscate. Why would the government take our gold? Because they will have nothing else to back our funny money. It will also be very easy to confiscate gold and silver in our EFT’s and then reimburse us for the siezure. Currently, I believe $35 per ounce is on the official books, but this may have changed.

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Any thoughts about Kitco’s “Pool” accounts?
I think having a good food supply would be prudent to have as well, don’t you?

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Have recently been receiving mailings from the Agora group of companies offering 1/10th oz.PANDA gold coins from China that are also PURER than American gold coins. There pitch is that a limited amount of M69 graded coins will produce a future premium as the expanding middle class in China begins to learn more about numismatics investing. According to the report BOTH American grading services are attempting to be first on the block in the Chinese market.

Single coins are priced at $159. package of 5 @ $149 EACH!

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Mark Bohana Reply:
February 13th, 2009 at 10:36 am

You can get any new gold coins, go to NGC or PCGS, get them slabbed as seen on the shopping network and you will have various gradings. The cost for grading and slabbing will depend on your quantity, and than you can sell it to the newbies, general public for 20-30% premiums. Dont forget most of these people will also let you purchase your own OBAMA dollar, with the new president painted on your dollar, hell of a deal. I am not trusting my retirement, oops I am already retired on the beach, toward statequarters,commemorative gold Panda’s or Horses, and certainly not baseball cards.

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StockGumshoe Reply:
February 13th, 2009 at 10:43 am

Right you are, Mark — everyone knows the real money is in Beanie Babies!

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StockGumshoe Reply:
February 13th, 2009 at 10:43 am

Right you are, Mark — everyone knows the real money is in Beanie Babies!

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Mark Bohana Reply:
February 13th, 2009 at 10:36 am

You can get any new gold coins, go to NGC or PCGS, get them slabbed as seen on the shopping network and you will have various gradings. The cost for grading and slabbing will depend on your quantity, and than you can sell it to the newbies, general public for 20-30% premiums. Dont forget most of these people will also let you purchase your own OBAMA dollar, with the new president painted on your dollar, hell of a deal. I am not trusting my retirement, oops I am already retired on the beach, toward statequarters,commemorative gold Panda’s or Horses, and certainly not baseball cards.

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ETF’s are not taxed as collectibles, they are taxed as STCG/LTCG depending on the holding period. They also are not “taxed in advance or taxed before actual paper profits are realized” by marking them to market as are commodities contracts. Why would the government confiscate gold when the dollar is not backed by the gold metal………? let’s let the hypothecator ruminate on this one for a moment. The Fed requests the BEP to print ridiculous quantities of paper or digital money…backed by nothing but you and me. Foreign governments and their SWF’s see that the amount of liability created by this wonderful set up is nothing short of crushing and impossible to repay. They decide to no longer accept this fiat “money” as an exchange medium. So what’s the World’s Newly Birthed soon to be Largest Nanny State to do? Devalue the currency, let the market discount/devalue the currency, print new currency………..backed by the same ol’ debt crushed you and me, or perhaps start paying in gold? The last time I ran the numbers on it, which was before the massive expansion of the money supply in September of 2008, and way before the massive “800 billion plus bank bailout”, in order for all of the US$ in circulation to be backed by the reserves of gold in Fort Knox (taken on faith), gold would have to be fixed at over $35,000 an ounce. There are many sources I’ve read that “guesstimate” the amount of gold held privately in the US. They are all over the board but suffice it to say that there’s probably at least as much in private hands as in the governments and probably more. If that were confiscated and used to back the currency, that gets us to around $17,500 per ounce and possibly as low as roughly $12,000 per ounce. Many of the pundits I’ve read believe that over the next few years that gold could easily be in the multi thousands per ounce and I personally believe their case for it is strong, and don’t forget golds old inflation adjusted high was approximately $2500 per ounce. It’s not that far of a stretch to imagine a scenario where government may take the metal and again revalue it. Would foreign governments and SWFs let this happen…..I don’t know but they all have huge holdings in the yellow metal. it’s something to ponder!

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if you purchase rare coins, gold or otherwise, from a reputatable dealer and then sell them a few years later, the dealer is not legally obligated to report the sale(profit or loss) to the IRS.
Check it out.

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Doc’s numbers are pretty accurate. Thats assuming the gov’t actually holds the gold reserves they claim to have. After WW2 the U.S. gov’t held 4.2 billion ounces of silver. It was sold off and the gov’t now must enter the open market to produce their silver coins from the mint.This includes the Eagles. There is currently more physical gold in the world than silver. Silver is an industrial metal in addition to being seen as “money” by many people. The silver is used up and can’t be replaced. Consumption has outstripped production for 20 years. Silver will do better than gold. Junk silver coins are sold in $1,000 face bags. The bags must be weighed because circulation wears some of the silver away and the .77 ounce of silver per dollar face is now a bit lighter. Physical silver and gold is the only way to go. If you let someone else hold and store your gold and silver you may not get it when you ask for it. So always take delivery. Keep your powder dry and your ear close to the ground.

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I don’t mean to talk down to you, my brothers and sisters, so hear me out – for those of you that need it.

There IS a great market in modern US Govt. manufactured gold cons, however there are two factors working against YOU, the casual investor:

1. Rarity – It’s hard to predict what will be a limited run. The $5 coins minted at Wes Point in recent years were rather low mintage, but others were not. Rarity drives high prices…generally, but not always.

2. Condition – The “crazy” EBay prices have to do with coins submitted to a few, well-known coin grading companies, such as NGC or PCGS. The rank, “MS-70” is considered “perfect. “MS” denoting, mint-state, these coins can range down to MS-60 and still be considered “Mint States”, but the price difference between an MS-60 and an MS-70 is astronomical.

You have to know what you are buying and what the real price is. Note: The average coin you receive from the mint, new in its packaging, will likely rate at MS-64 to MS-66. Thus, few coins hit the highest grades, and then sometimes by a fluke.

Bottom-line: Know your coins before you throw money away. Get the “Red Book” coin guide, issued annually. Buy a few coin magazines. Attend a large coin show, without buying anything.

In other words, get smart. Or, send $25,000 to me, in small, unmarked bills, and I will sent you some very rare baseball cards that are guaranteed to be collectible!

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