Perth Mint Online Depository Program

Discussion of the Gold portion of the Permanent Portfolio

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sixdollars
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Perth Mint Online Depository Program

Post by sixdollars » Mon Apr 25, 2016 6:42 pm

Have any of you guys looked into this?

https://www.perthmint.com/storage/depos ... ogram.html

I am in the process of opening an account, seems like an easy way to get geographic diversification through them now.  I'm guessing no need to go through the old certificate program? 8)
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Re: Perth Mint Online Depository Program

Post by AdamA » Mon Apr 25, 2016 6:51 pm

Good discussion here.

http://gyroscopicinvesting.com/forum/gold/perth-mint/

There are a lot of good posts by the user named Bronsuchecki.  He works there, I think. 
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Re: Perth Mint Online Depository Program

Post by sixdollars » Mon Apr 25, 2016 7:03 pm

AdamA wrote: Good discussion here.

http://gyroscopicinvesting.com/forum/gold/perth-mint/

There are a lot of good posts by the user named Bronsuchecki.  He works there, I think.
Isn't that discussion with regards to the certificate program which had a 10k minimum? I believe this new one doesn't have this requirement unless I'm missing something.

https://www.perthmint.com/storage
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Re: Perth Mint Online Depository Program

Post by MachineGhost » Mon Apr 25, 2016 7:04 pm

This is the best news in a long time!!!
How can unallocated be 100% backed, yet there is no storage fee?

Unlike other depositories, which are merely warehouses, The Perth Mint is a manufacturer of precious metal products and one of the world's largest refiners. Accordingly, we have a substantial requirement for physical metal to support these operations.

To fund this working inventory, we traditionally borrowed metal from bullion banks, at cost. At the same time, investors were depositing metal with bullion banks and others and being charged storage fees.

We realised there was an opportunity to cut out the intermediary and take deposits directly from investors. The Perth Mint's unallocated is thus a win-win situation: we get to "borrow" precious metal to use in our business for free and you get 100% backed safe storage of your precious metal for free.

We don't charge storage fees on unallocated because the costs of vaulting and insuring our working inventories of gold and silver are part of our business and covered by the fabrication fees we charge for our bars and coins - we would incur these costs whether our metal was sourced from you or a bullion bank. We charge storage fees on allocated and pool allocated because we incur additional vaulting and insurance costs for storing this custodial precious metal.
Still, its a liability of Perth and not your asset.  It is a Ponzi scheme if you request "your" metal.  And if they have to source it outside of other Ponzi scheme participants due to excess demand in a crisis, you may not receive "your" metal at all while the price continues to skyrocket.

They have very steep transanction fees, allocated storage fees and fabrication fees.  Not much has changed.
Last edited by MachineGhost on Mon Apr 25, 2016 7:15 pm, edited 1 time in total.
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Re: Perth Mint Online Depository Program

Post by sixdollars » Mon Apr 25, 2016 7:15 pm

MachineGhost wrote: This is the best news in a long time!!!
How can unallocated be 100% backed, yet there is no storage fee?

Unlike other depositories, which are merely warehouses, The Perth Mint is a manufacturer of precious metal products and one of the world's largest refiners. Accordingly, we have a substantial requirement for physical metal to support these operations.

To fund this working inventory, we traditionally borrowed metal from bullion banks, at cost. At the same time, investors were depositing metal with bullion banks and others and being charged storage fees.

We realised there was an opportunity to cut out the intermediary and take deposits directly from investors. The Perth Mint's unallocated is thus a win-win situation: we get to "borrow" precious metal to use in our business for free and you get 100% backed safe storage of your precious metal for free.

We don't charge storage fees on unallocated because the costs of vaulting and insuring our working inventories of gold and silver are part of our business and covered by the fabrication fees we charge for our bars and coins - we would incur these costs whether our metal was sourced from you or a bullion bank. We charge storage fees on allocated and pool allocated because we incur additional vaulting and insurance costs for storing this custodial precious metal.
Still, its a liability of Perth and not your asset.  It is a Ponzi scheme if you request "your" metal.  And if they have to source it outside of other Ponzi scheme participants due to excess demand in a crisis, you may not receive "your" metal at all while the price continues to skyrocket.
I think that's the risk of unallocated in general, not unique to the Perth Mint.

Also, don't you avoid a lot of this by preempting to allocated during uncertain times (i.e. before the crises hits)?
Last edited by sixdollars on Mon Apr 25, 2016 7:18 pm, edited 1 time in total.
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Re: Perth Mint Online Depository Program

Post by MachineGhost » Mon Apr 25, 2016 7:18 pm

sixdollars wrote: I think that's the risk of unallocated in general, not unique to the Perth Mint
Yeah, but no one with a brain would use unallocated storage except as a temporary parking place.  Perth is charging too much non-storage fees to be cost effective compared to other [pool] allocated storage options.
sixdollars wrote: Also, don't you avoid a lot of this by preempting to allocated during uncertain times (i.e. before the crises hits)?
You're going to pay the 5% fee just to do that???  It's bad enough you have to pay all of the Perth fees on top of the original bid-ask spread.
Last edited by MachineGhost on Mon Apr 25, 2016 7:20 pm, edited 1 time in total.
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Re: Perth Mint Online Depository Program

Post by sixdollars » Mon Apr 25, 2016 7:22 pm

MachineGhost wrote:
sixdollars wrote: I think that's the risk of unallocated in general, not unique to the Perth Mint
Perth is charging too much non-storage fees to be cost effective compared to other [pool] allocated storage options.
sixdollars wrote: Also, don't you avoid a lot of this by preempting to allocated during uncertain times (i.e. before the crises hits)?
You're going to pay the 5% fee just to do that???  It's bad enough you have to pay all of the Perth fees on top of the original bid-ask spread.
What other pool allocated storage options would you recommend then?

And no, I haven't actually committed to anything yet, I'm still exploring options
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Re: Perth Mint Online Depository Program

Post by Hal » Mon Apr 25, 2016 9:55 pm

Well.....

I use the "Allocated" Perth Mint Depository Program, not the Certificate Scheme.

They will send you the bullion from storage when requested, and if you wish to drop in, (bit hard from the USA), you can physically inspect your holdings.

So honestly, I cannot complain about the "Allocated" holding program.

Also GoldMoney offers an Allocated program as well, but in this case you would have to go to Switzerland to verify your holding.

Does anyone else have comments about other depositories?

Hal

http://www.perthmint.com.au/documents/R ... e_2014.pdf
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Re: Perth Mint Online Depository Program

Post by technovelist » Mon Apr 25, 2016 10:03 pm

Global Gold (globalgold.ch) has several types of allocated storage (no unallocated types) at prices starting at about 0.5%/year for $250K (slightly higher for lower amounts).
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Re: Perth Mint Online Depository Program

Post by sophie » Tue Apr 26, 2016 7:49 am

globalgold looks really good, except for the minimum of 50,000 CHF.  Thanks for the info on Perth Mint!

It looks like Fidelity has lowered its storage fees to a total of 0.5%/year.  It doesn't say whether it's allocated storage though, will probably require a phone call to get more info.  I believe they store their bullion in Nova Scotia, but this may not count as geographic diversification.  The big advantage is that you can buy bullion in retirement accounts held at Fidelity for only a slightly higher expense ratio than ETFs, which is pretty awesome.
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Re: Perth Mint Online Depository Program

Post by technovelist » Tue Apr 26, 2016 8:15 am

sophie wrote: globalgold looks really good, except for the minimum of 50,000 CHF.
I wouldn't think that would be a big problem for most of the people on this forum.
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Re: Perth Mint Online Depository Program

Post by sophie » Tue Apr 26, 2016 8:34 am

technovelist wrote:
sophie wrote: globalgold looks really good, except for the minimum of 50,000 CHF.
I wouldn't think that would be a big problem for most of the people on this forum.
I guess you have a big taxable stash!  Congrats are in order.  Or maybe you don't contribute much to tax advantaged accounts?  Tax deferral/Roth is a big enough deal in my high tax heaven here that tax advantaged account contributions take precedence over all else.
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