Best Deal right now on Gold

Discussion of the Gold portion of the Permanent Portfolio

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Mark Leavy
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Re: Best Deal right now on Gold

Post by Mark Leavy » Sat Dec 05, 2020 8:43 pm

I like having a few rolls of Mercury dimes on me. Just for fun. Similar to a wad of two dollar bills.
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Re: Best Deal right now on Gold

Post by SomeDude » Sat Dec 05, 2020 8:44 pm

So in dollar terms gold premiums tend to rise over time with inflation, as again the mints and dealers have to cover rising costs. Since gold trends to rise with inflation (with a 1-2% real rate of return) over time, the percentage over spot is pretty static.

And that is the number that matters, not the dollar figure.

I think cort mentioned buying eagles for 35 over spot. Now i have never seen it that low, because that is under what the US mint charges it's dealers and has for a long time. Its possible these were beat up coins or "cull" grade as we say.

Regardless, the 35 was in the past. It might have been when gold was under 1,000 so that means close to 4% again. And this is what matters and what can affect your return, the percent you pay over spot, not the dollar number.
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Re: Best Deal right now on Gold

Post by SomeDude » Sat Dec 05, 2020 8:56 pm

So we know premiums will rise over time with inflation. We know they spike when there is market instability. Ironically, i have seen them spike when spot price crashes and demand for physical explodes. I've seen them spike when spot moves up quickly as well. Those spikes have ALWAYS petered out though.

Basically my experience has been that physical gold gets disproportionately expensive relative to paper gold wherever volatility goes up and big price moves occur.

With gold it's a fraction of the craziness in silver, but i was seeing premiums on 1oz gold eagles at 10% and even more earlier this year when spot dropped.

Part of that was the denominator (spot) was suddenly lower, but the numerator (premium) was also going up as physical demand surged.

This was true at my LCS's and online.

Lesson here is......if you feel comfortable with the risk.....buying paper gold after a big sell off then switching it out for physical when price moves back up and premiums cool might be a great play.
Last edited by SomeDude on Sat Dec 05, 2020 9:02 pm, edited 1 time in total.
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Re: Best Deal right now on Gold

Post by SomeDude » Sat Dec 05, 2020 8:57 pm

Ok i need to warm up a bottle of milk and serve my 8lb master......
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Re: Best Deal right now on Gold

Post by SomeDude » Sat Dec 05, 2020 8:59 pm

Mark Leavy wrote:
Sat Dec 05, 2020 8:43 pm
I like having a few rolls of Mercury dimes on me. Just for fun. Similar to a wad of two dollar bills.
Ohhhh yeah love em. I actually clean my junk silver which is heresy in the community but its so cool having US coins that shine like crazy. I've got several large bags of dimes, quarters, and halves. Some back to 1915.

Very cool to think about all the hands they passed through and trade they facilitated.
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Re: Best Deal right now on Gold

Post by Mark Leavy » Sat Dec 05, 2020 9:45 pm

SomeDude wrote:
Sat Dec 05, 2020 8:59 pm
Mark Leavy wrote:
Sat Dec 05, 2020 8:43 pm
I like having a few rolls of Mercury dimes on me. Just for fun. Similar to a wad of two dollar bills.
Ohhhh yeah love em. I actually clean my junk silver which is heresy in the community but its so cool having US coins that shine like crazy. I've got several large bags of dimes, quarters, and halves. Some back to 1915.

Very cool to think about all the hands they passed through and trade they facilitated.
Well, yeah. That is pretty cool. But if you’ve ever dated a Voodoo priestess ...

;)
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Re: Best Deal right now on Gold

Post by Kriegsspiel » Sun Dec 06, 2020 5:48 am

SomeDude wrote:
Sat Dec 05, 2020 8:59 pm
Very cool to think about all the hands they passed through and trade they facilitated.
That is cool to think about. I also have some junk silver with a long life (in fact, they may be the oldest items I own). It reminds me of this observation:
Many a gem which hangs now on an English lady’s wrist saw Alaric sack Rome—and saw before and since—What not? The palaces of the Pharaohs, or of Darius; then the pomp of the Ptolemies, or of the Seleucids—came into Europe on the neck of some vulgar drunken wife of a Roman proconsul, to glitter for a few centuries at every gladiator’s butchery in the amphitheatre; then went away with Placidia on a Gothic ox-wagon, to pass into an Arab seraglio at Seville; and then, perhaps, back from Sultan to Sultan again to its native India, to figure in the peacock-throne of the Great Mogul, and be bought at last by some Armenian for a few rupees from an English soldier, and come hither—and whither next? When England shall be what Alexandria and Rome are now, that little stone will be as bright as ever.
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I feel dumb for not mentioning jewelry in the Hard Assets thread.
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Re: Best Deal right now on Gold

Post by jatwell » Tue Dec 08, 2020 9:19 pm

Any concern on shipping via Fedex or UPS?

I believe their T&C's prohibit bullion/precious metals yet a lot of the online retailers seems to use them vs USPS.
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Re: Best Deal right now on Gold

Post by Mark Leavy » Wed Dec 09, 2020 2:22 am

jatwell wrote:
Tue Dec 08, 2020 9:19 pm
Any concern on shipping via Fedex or UPS?

I believe their T&C's prohibit bullion/precious metals yet a lot of the online retailers seems to use them vs USPS.
In real practice, I don't think it is an issue. I would go for it.
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Re: Best Deal right now on Gold

Post by SomeDude » Fri Dec 11, 2020 11:21 pm

I need to get back to the physical premium discussion now that it's the weekend.

Work was murder this week. My newborn needs a bottle every 2-3 hours so i sleep from 6-8 PM and 4AM-8AM. My wife sleeps in the middle of that. Brutal.

I did get my 1/4 oz US mint coins i bought for $446 on black friday. Cheapest price now is $465 so that's about 3.5% up.

They're really nice, an '87 and an '88. An eagle and statue of liberty design respectively.

They're .242 oz of gold each and a 90% alloy, just under 22kt.

I'll post some pics. Highly encourage these $5 face value us commemorative coins if you can get them for low over spot.
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Re: Best Deal right now on Gold

Post by SomeDude » Mon Dec 21, 2020 12:45 pm

These are back on sale:

https://sdbullion.com/5-us-commemorativ ... prices.com

fractional, US mint, legal US tender, collectible variety, about 2% over spot.

It really doesn't get much better.

My first two were the statue of liberty and an eagle.

I'm going to order more today, just not sure how many.
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Re: Best Deal right now on Gold

Post by Kriegsspiel » Mon Dec 21, 2020 6:43 pm

It's good to know SDBullion has regular sales, I'll make sure to check them next time I am buying. I'd like to now, after reading about the newest stimulus bill, but I'm quite overweight gold as it is.
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Re: Best Deal right now on Gold

Post by SomeDude » Mon Dec 21, 2020 7:38 pm

Kriegsspiel wrote:
Mon Dec 21, 2020 6:43 pm
I'm quite overweight gold as it is.
Now isn't the time for a diet Herr Wargame
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Re: Best Deal right now on Gold

Post by thisisallen » Mon Dec 21, 2020 7:53 pm

SomeDude wrote:
Mon Dec 21, 2020 12:45 pm
These are back on sale:

https://sdbullion.com/5-us-commemorativ ... prices.com

fractional, US mint, legal US tender, collectible variety, about 2% over spot.

It really doesn't get much better.

My first two were the statue of liberty and an eagle.

I'm going to order more today, just not sure how many.
What’s the benefit of “legal tender?” You can’t use these as cash in a transaction or redeem them for cash at a bank, can you?
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Re: Best Deal right now on Gold

Post by Mark Leavy » Mon Dec 21, 2020 7:59 pm

Legal tender has different tax implications.
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Re: Best Deal right now on Gold

Post by Kriegsspiel » Mon Dec 21, 2020 8:12 pm

SomeDude wrote:
Mon Dec 21, 2020 7:38 pm
Kriegsspiel wrote:
Mon Dec 21, 2020 6:43 pm
I'm quite overweight gold as it is.
Now isn't the time for a diet Herr Wargame
It doesn't make sense to buy gold when I'm flirting with the 35% band.

This is one of the only times that I'd actually wanting to buy the overweight asset. Back when I rebalanced out of stocks, I was only too happy to unload them.
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Re: Best Deal right now on Gold

Post by SomeDude » Mon Dec 21, 2020 8:17 pm

thisisallen wrote:
Mon Dec 21, 2020 7:53 pm
SomeDude wrote:
Mon Dec 21, 2020 12:45 pm
These are back on sale:

https://sdbullion.com/5-us-commemorativ ... prices.com

fractional, US mint, legal US tender, collectible variety, about 2% over spot.

It really doesn't get much better.

My first two were the statue of liberty and an eagle.

I'm going to order more today, just not sure how many.
What’s the benefit of “legal tender?” You can’t use these as cash in a transaction or redeem them for cash at a bank, can you?
Def do not use a $465 coin for a $5 purchase
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Re: Best Deal right now on Gold

Post by SomeDude » Mon Dec 21, 2020 8:20 pm

Kriegsspiel wrote:
Mon Dec 21, 2020 8:12 pm
SomeDude wrote:
Mon Dec 21, 2020 7:38 pm
Kriegsspiel wrote:
Mon Dec 21, 2020 6:43 pm
I'm quite overweight gold as it is.
Now isn't the time for a diet Herr Wargame
It doesn't make sense to buy gold when I'm flirting with the 35% band.

This is one of the only times that I'd actually wanting to buy the overweight asset. Back when I rebalanced out of stocks, I was only too happy to unload them.

Wow 35% even with the ridiculous (my opinion) run up in stocks?
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Re: Best Deal right now on Gold

Post by Kriegsspiel » Mon Dec 21, 2020 8:32 pm

Well, gold's had a good run recently as well. I also don't auto-reinvest dividends or interest, which skews my results compared to other people.
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Re: Best Deal right now on Gold

Post by geaux saints » Thu Dec 24, 2020 7:44 pm

One thing I've thought of doing is buying low-mintage, graded proof gold from countries other than the United States. There are times when you can get them for close to melt. I wouldn't do it with more than, say, 25% of my gold allocation because these coins are not nearly as recognizable as the common bullion issues. But the low premiums over spot, combined with the possibility of price appreciation, has me tempted.

Does anyone have any thoughts?
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Re: Best Deal right now on Gold

Post by Mark Leavy » Thu Dec 24, 2020 8:19 pm

Not familiar with the concept. Intriguing.

What are some examples of:
geaux saints wrote:
Thu Dec 24, 2020 7:44 pm
low-mintage, graded proof gold from countries other than the United States.
On the surface, it looks like a free option. My favorite thing.
Won't ever be less valuable than spot, might be more valuable at some point.
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Re: Best Deal right now on Gold

Post by SomeDude » Thu Dec 24, 2020 8:23 pm

geaux saints wrote:
Thu Dec 24, 2020 7:44 pm
One thing I've thought of doing is buying low-mintage, graded proof gold from countries other than the United States. There are times when you can get them for close to melt. I wouldn't do it with more than, say, 25% of my gold allocation because these coins are not nearly as recognizable as the common bullion issues. But the low premiums over spot, combined with the possibility of price appreciation, has me tempted.

Does anyone have any thoughts?
Can you give any examples? I can't think of any gold product that fits this description. I thought i knew just about every coin out there.
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Re: Best Deal right now on Gold

Post by geaux saints » Thu Dec 24, 2020 9:12 pm

Here is a good example: https://www.ngccoin.com/price-guide/wor ... id-1529612

Same specifications as a UK Sovereign. With patience you can find these close to melt; and look at those mintages!
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Re: Best Deal right now on Gold

Post by Mark Leavy » Thu Dec 24, 2020 9:19 pm

Cool. Thanks.

Fun to think about. My gut feel is take all of the free options you can get.
But the tradeoff is ease of liquidation.

Seems worth buying a handful if you were going to be buying anyway. Plus, they are gorgeous.
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Re: Best Deal right now on Gold

Post by SomeDude » Thu Dec 24, 2020 10:23 pm

geaux saints wrote:
Thu Dec 24, 2020 9:12 pm
Here is a good example: https://www.ngccoin.com/price-guide/wor ... id-1529612

Same specifications as a UK Sovereign. With patience you can find these close to melt; and look at those mintages!
I have some 2 rand coins, not proof though. These are about 10% over spot though. You can get proof eagles for that. Let me see if i can find a quote.
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