How and Why You Should Buy Physical Gold Offshore
The Q Wealth Report
07 October, 2008
Well, I havent been blogging here for a few weeks, because as I explained I was taking some well deserved rest and relaxation. But, I certainly came back with a bang right in to the middle of what already is the most serious global financial crisis in generations, despite the US Treasury and others still claiming that they are trying to avert a crisis.
Unsurprisingly, troubles with big banks in the USA have spread into the offshore orbit, with UK taxpayers bailing out an Isle of Man bank (Bradford and Bingley) and the Luxembourgers bailing out their local arm of Fortis, the former Banque Generale du Luxembourg where I used to do international corporate business some years ago.
Any illusion of free markets disappeared long ago. This might account for why the dollar is stronger than it was a few months ago despite the Fed printing seven hundred billion more of them! (Any rational person can see that this just adds to the debt and cannot be good for the long term) The price of gold has been topsy turvy lately and only risen marginally until now, despite an unprecedented shortage which has means very few people can actually get their hands on physical gold at the moment. The fact that an unprecedented demand does not drive the price higher tells us a lot about how these markets are being manipulated. Still, gold is the ultimate safe haven store of wealth and Im sure the price is set to go a lot higher at least in dollar terms.
On the subject of gold, I am advising clients more than ever to buy real, physical gold if they can! Gold ETFs, which have become very popular in the last year or two, are not a substitute for the real thing. What if the bank or fund manager goes out of business? What if trading in the shares is suspended, as for example short selling was just suddenly banned? What if the whole exchange is suspended as has happened in the past? Shares can be subject to massive manipulation and liquidity problems. I believe we will see dual gold prices from now on one official spot price which ETFs will try to track, and another price for physical dictated by pure supply and demand. This will be the real free market price at which you can actually buy and sell real gold in the real world.
So how does one go about buying real gold? Theres no easy answer to that. I asked one of my bankers about buying gold just last week, and the response was that the storage, transport and audit fees would be very expensive, but that it was possible, but that ETFs or Perth Mint Certificates would be much better. When I finally got across the message that I wanted to receive several hundred thousand euros worth of gold in my hands and walk out of the bank with it, I was told that the compliance department would never countenance it. So apparently they were quite happy to sell me a product, but not for me to actually take possession of it! That might sound bizarre to most people who are used to buying and selling most kind of goods, but it does not surprise me in the least. That is just typical of todays financial system!
If you would like to know where you can really buy gold and receive it, there are some links on this page which I will also be updating and adding to shortly as time permits. Watch this space for more!
P.S. I have set up a page on Twitter, at which you can see my tweets very short commentaries of 150 characters or less. Check http://www.twitter.com/qwealth
Peter Macfarlane is joint editor of The Q Wealth Report an established newsletter dedicated to informing readers about creating, protecting and growing wealth in a secure offshore environment. It also covers international living, banking, retiring and investing. Visit www.QWealthReport.com to see more.
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