Reading time: 6 – 10 minutes
I am always amazed by the diversity of readership and Germany is my fifth largest audience behind the US, Canada, United Kingdom and Australia. I do wonder how the tens of thousands of Germans understand my site but Google Translate works wonders. That is how I understood the front-page MMNews article Die Grosse Kredit-Kontraktion about my liquidity pyramid. The Germans love their gold and GoldMoney is catering to this market.
REMONETIZATION OF PRECIOUS METALS
Chief Chicken Little, Chris Powell of GATA, said in the video, “I think GoldMoney is probably the most revolutionary thing going on today. It is a very convenient remonetization of gold and silver [and platinum]. It is putting gold and silver back to work for ordinary people in a very convenient way as a form of savings and as a form of payment. I am a very satisfied GoldMoney customer of many years.”
I have not found a more efficient way to buy physical platinum and with the increased monetization of platinum I think there is more upside profit potential for platinum than either gold or silver. It is up $320 per ounce in the four months since I recommended buying it.
For example, if anyone wants to purchase The Great Credit Contraction and settle the transaction via GoldMoney then I will offer a discount (0.74 gold grams, 1.5 silver ounces or 0.6 platinum grams). The last time I offered taking payment in platinum I had people from Sweden, the US and other countries take me up on it. So, just contact me to make arrangements.
MY RECOMMENDATION
Due to the tremendous inquiries seeking advice I wrote an in-depth page on how to buy gold, silver or platinum. In essence, besides getting a coin or bar in your hand the only third-party arrangement I can recommend is GoldMoney. But I think the service is fairly expensive for IRA or 401k funds and I would not use them for that purpose. Nevertheless, I think the service is equally useful to the person buying a few hundred grams of gold to those buying millions of dollars worth and everyone should have a functioning account.
MY REVIEW
Ability to Demand Delivery of Gold. According to the User Agreement under VIII. Storage “E. A User may, by providing GoldMoney with delivery instructions, which instructions must be in the form prescribed from time to time by GoldMoney and the Vault, at any time request GoldMoney to change the goldgrams and silver ounces in his Holding into grams of gold or ounces of silver that are available for physical delivery to the User, provided that there are sufficient goldgrams and silver ounces to take delivery of a London Good Delivery bar of gold, which bar weighs approximately twelve thousand five hundred (12,500) grams, or bar of silver, which bar weighs approximately one thousand (1,000) ounces. GoldMoney will not charge a fee for its service, but fees may be charged by the Vault for acting on the delivery instructions.”
SHADY CHARACTERS
Physical delivery at any time is the standard from a party you can trust. This is particularly important considering the shady dealings of some in the industry.
For example, I recommend staying away from unnecessarily complex instruments even if issued through perceived reputable firms. For example, in June 2007 Morgan Stanley & Co. (also involved with the problematic GLD ETF – part I; part II) settled a class action lawsuit for $4.4 million where the complaint alleged
that Morgan Stanley told clients it was selling them precious metals that they would own in full and that the company would store. But Morgan Stanley either made no investment specifically on behalf of those clients, or it made entirely different investments of lesser value and security.
OTHER RECOMMENDATIONS
Several investment professionals have reviewed and recommend GoldMoney including billionaire Eric Sprott, John Embry, Mike ‘Mish’ Shedlock, Doug Casey, Peter Schiff, Mike Maloney, Jim Willie, Ed Steer, and many others.
CONCLUSION
You can reduce risk by keeping your cash balances in the precious metals. This reduces the demand for fiat currencies and like pinching an esophagus it eviscerates the lung’s source of oxygen. The remonetization of precious metals with 100% reserves is a revolutionary way to starve the vampire squids of one of their prime sources of food!
GoldMoney accounts are free to open and you will even get 6 months of storage fees waived (you should get an email shortly after signing up) So why not?
I would love to hear the opinion of other GoldMoney customers. Please comment!
GoldMoney Releases German WebsiteRELATED POSTS:
- Gold Party Barely Started
- The Coming Market Crash
- Gold And The Oil Majors Revisited
- Massive Institutional Gold Market Change
- Inflation With Gary North Or Deflation With Mish
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{ 20 comments… read them below or add one }
You bet your boots !
Now with my GoldMoney acct ! I can buy your book ! ?
Heh Heh Heh ! I hate using cheap dollars anyway.
Gotta sign off but will do ASAP.
Hi Trace,
Regarding GoldMoney: I use it for my bedrock core position. I think the fees are a little high, but maybe one gets what one pays for? I trust James Turk more than most. But what stops GoldMoney from being a victim of the tungsten fraud?
I use BullionVault for trading. What is your opinion of them?
Are there any other trustworthy services you know of?
And what is your opinion on this: the US imposes a 90% windfall tax on profits in gold?
Thanks. Loved your book.
Luke Forest
Thanks Luke.
I suppose GoldMoney could be exposed to this latest tungsten nonsense because it uses London Good Delivery bars. But then I would just switch to platinum or silver which could be done in one trading day. Even if the tungsten nonsense does turn out to be something legitimate I doubt the same problems would be possible with platinum or silver because so many of the bars are used industrially on a regular basis. There are plenty of issues in the gold market but I highly doubt tungsten is one of them and I have been unable to find any credible and verifiable sources but my mind is open to examine the evidence should any actually be presented. Either way it is a good example of ‘why gold bugs are considered nuts‘.
I have a BullionVault account and some capital there but have not investigated BV seriously enough for an informed opinion. But I also occasionally use the GLD ETF and futures for trading. But I would trust BV a whole lot more than GLD or futures.
I think a windfall profit tax is more likely than a gold confiscation. But I think the probability of such a tax, greater than the current 28%, is fairly low.
Since you do not recommend GoldMoney for IRA and 401(k) accounts what is the alternative if physical bullion is desired?
Thank you.
One of the prime reasons to own physical bullion is to have unencumbered wealth.
In my opinion, having a custodian between you and your assets that kowtows to ever changing rules from the costumed criminal gangs defeats one of the prime reasons for owning this particular type of asset. Almost all baby boomers would have been better off buying a gold or silver coin every month instead of putting any capital into a 401k or IRA and the coins would be much more private. To illustrate the point I recommend watching Confiscating Certificates Of Confiscation. Just wait until the US nationalizes 401Ks and IRAs like Argentina did a few months ago. Get out of the way!
Hi Trace,
Thank you for your tireless efforts at showing the people how to flee to the safest assets of all time – precious metals. I was never a gold bug, but a year ago, when I bought my first bullion coins, and held one in my hand for the first time, something in my DNA instantly recognized the metal as the real deal. All the memories of my grandparents talking about the precious nature of precious metals instantly made sense.
Can you help me with the following: aside from physical bullion in my possession, I also am considering some stored in a Canadian custodial service called Bullion Management Group (http://www.bmginc.ca/bmgbullionbars) and they are listed in GATA’s website as a “Coin and precious metals dealers who have supported GATA and been recommended by our members:”. They charge a storage fee (more expensive than Goldmoney which I also use) and give you an actual deed for every bar listing the serial number. The insured bars are stored in ScotiaBank special vaults in Toronto. You can ask for your metal which they will deliver to you and there is a custodial agreement.
If you can look into this I would be most grateful.
Nicholas
Trace,
I forgot to add that Rob Kirby of Kirby Analytics is also an authorized dealer of Bullion Management Group. To me that’s very good.
Best regards,
Nicholas
Your experience seems common. As I wrote in Derivative Illusion, “Humanity’s gold lust has been dormant for nearly a century and when it awakens it will be extremely vehement and go viral. Those who own gold know of what I speak. The yellow metal seems to call out to the inner conscience and resonate with our DNA.”
I have not researched BMG but it is good to have eggs in multiple baskets so long as they are safe. With GATA’s reference and no complaints then it is safer than most and you likely do not have much to worry about. I do not have time for some thorough research but I may be able to talk to Bill and see if he does but his rate is probably around $200/hour for this type of freelance work. Let me know if you are interested and I will talk with him.
Hi! Under the subtitle ’shady characters’ there is this line “Physical delivery at any time is the standard from a party you can trust.”
We have a bit of conflict here, because if trust is required for a transaction, having physical in our hands does not establish trust. It is the hallmark of the coin or the image of the issuing monarch that somewhat initiates a level of trust in the verity of the coin. Even after seeing the hallmark, merchants had to use the touchstone to ascertain the quality of the metal, only then could they VALUE it! I suspect using easily recognized coins is what makes for an acceptable transaction between strangers!
Also, by having experience at using the touchstone, merchants or dealers were able to accept and trade in items of jewellery, other than a coin.
Any opinions on that?
Hi Trace, I’m one of your German readers, and rest assured I don’t need any translation software (which btw produces crappy results), as I’m sure your various other German readers don’t either. English is a mandatory part of the German school curriculum, and while everybody doesn’t speak it perfectly, those with enough education and background to be interested in your articles ought to have no difficulty reading them. On the other hand, despite having lived in the US for a number of years, I have only come across one (1) American that mastered German — the language of the biggest economy in Europe and, I might add, the ancestral tongue of a large percentage of Americans — to the point of understanding a (mainstream) German newspaper. Pretty sad, wouldn’t you say? Anyway, keep up the good work.
Hello Trace, Just a short question that I have not seen answered.How does one figure taxes with Gold Money? Short term, long term, or just forget it? Paying bills with G.M. would seem to be a tax nightmare if it’s being used daily. What do you do?? R.H.
It can get complicated Roger and is best left to an individual, their accountant and their attorney. There is also room for a creative financing such as hoarding the gold and operating with lines of credit, long-term debt, etc. But these issues are beyond the scope of this blog and would need much more customized work.
What do I do? That is interesting, why do you ask? Of course I pay all tax liability legally owed; I do not want any problems from the vampire squids.
Hi Trace, Re taxes: Now that GoldMoney has a German website you would think they’d offer at least a hint at how this might be taxed in Germany. Nope. I even wrote to them and got their standard ‘we can’t give tax advice’ reply. The thing is, GoldMoney ONLY makes sense to a German tax resident if that gold is not a ‘financial asset’ (Wertpapier) in a tax sense because only then is it free of capital gains tax after one year of owning it. Under German legislation, physical bullion coins or bars are not considered ‘financial assets’ in this sense, but ETFs are, presumably because you can trade them on an exchange. Where does GoldMoney fit in here? For a German investor, this question is absolutely crucial. I don’t get the point of GoldMoney advertising to Germans but leaving them in the dark about this. Mind you, other foreign banks (or investment entities) do not see themselves as unqualified at all to make general statements pertaining to capital gains taxation — in fact they use advantages in advertisements if there exist any. The fact that GoldMoney doesn’t do that leads me to suspect that it is treated like an ETF, in which case that would be a total show stopper for virtually any German PM investor. Or maybe it simply hasn’t been decided by the German tax department how to treat it, which would be equally damning.
PS: I’m not a lawyer. The above is how I understand the situation. If this is wrong, I’d be happy to get clarification from GoldMoney or anybody else.
Re Roger: I can’t speak for him, of course, but I think he didn’t mean to imply that you evade taxes. In my mind, he was simply asking what your buy and sell behavior is (frequent or not so frequent) based on your tax considerations.
Hi GermanDude, As I see the situation it would be unreasonable for GoldMoney to attempt to provide tax and legal advice that is country specific to its customers which it accepts from over 200 different countries. That would be an unreasonable burden and raise the costs tremendously because of how often the tax laws and regulations change, their ambiguity in man cases, the cost of the professionals involved and the potential legal and tax liability from malpractice. For example, John Newren (who has contributed a few articles to the site) is a practicing tax CPA with a big four accounting firm, specializes in foreign currency and bills out at hundreds of dollars per hour. Apmex, Goldline, etc. do not provide tax or legal advice when buying coins or bars so I do not really see any reason why GoldMoney should be any different.
I can understand your frustration with the German human livestock management institution. We have a similar problem with the American version as they will not even define the dollar. After all, what is a Euro? What about those 1.5 Euro silver Austrian Philharmonics? More room for creativity!
I was just teasing Roger ;) Theoretically, if you time things correctly and keep accurate records in many cases you can be taking a deduction for interest expense and a deduction for sale at a loss on the bullion. But this is not really feasible, yet, unless on a fairly large scale.
Hi Trace, Thanks for your answer. I understand what you and GoldMoney are saying. It’s just that there aren’t 200 German-speaking countries, there are really only a handful. I know the coin vendors don’t provide tax advice, neither in the US nor in Germany, but that situation is a lot easier to figure out on your own. Anyway, the obscurity of the tax situation surrounding GoldMoney has kept me from using it. I’ve opted for physical coins instead.
You’re of course right in asking about what a dollar or a euro is. You probably know all about what the dollar is and isn’t. I’ll tell you what the euro is: it was France’s price for German reunification. They’re largely keeping this out of the press, but it’s well documented that Mitterrand (and Thatcher) tried everything in their might to prevent reunification, and when they saw they couldn’t they said okay, then we’ll stiff you guys for it. Those are supposedly our bosom friends of ‘Franco-German friendship’ — whose nuclear missiles don’t go further than 500 km, i.e., straight into Germany.
To be sure, the DM was fiat, too. But it was a lot better than all the rest of the eurozone currencies, and the Bundesbank — unlike the Federal Reserve — is owned by the German federal government (not private banks) from whom, however, it was independent in its decision making. I am of the mind that having no central bank would be even better, but IF you’re going to have one the Bundesbank was as good as it gets. And they gave that up so now we have French-style political meddling. Great. I doubt the Bundesbank would have lowered rates quite as much as the ECB has done. WE didn’t have a housing bust, remember?
Anyway, have a great rest of your weekend.
PS: You may know that the euro has been referred as the Teuro in Germany, referring to the word ‘teuer’ meaning expensive. We essentially now pay the same prices in euros that we used to in DM (a factor of two) ten years ago while salaries have remained virtually constant (unsurprisingly the price inflation index doesn’t reflect that). And this is before the big onset of price inflation from all the money printing. Admittedly Germany has enough domestic budget problems as our welfare state is out of whack just like everywhere else, but bailing out all the rest of Europe sure won’t help.
And for what? I’m all for equitable and fair trade and other cooperation within Europe. Being able to live and work in all the countries is great. But a single currency in such diverse countries, and without a common budget policy simply doesn’t work. I don’t expect the euro to survive the crisis.
> PS: You may know that the euro has been referred as the Teuro in
referred to as
PPS: If in the wake of a euro breakup there were to come a northern currency bloc, essentially an enlarged DM remake, including Germany, Austria, Benelux, maybe Scandinavia — and without France — I’d be laughing all the way from here to Versailles…