A book review for the book "Buy Gold Safely" by Doug "Digger Everhardt.
After reading extensively about the problems in Greece and the looming problems in Portugal, Spain, UK and ultimately the USA, you are afraid to invest in anything. It looks like we are about to go on the ride of our lifetime but it’s not going to be pleasant.
The stock market is poised for a correction, and if the guru’s that I rely on are correct, it is going to be deep and permanent (at least for a couple of years ). When I say deep, most of these guru’s are talking about the Dow Jones Industrial Average at a low of 2000 on the low side to a high of about 5000.
Now if they are right that’s not a correction, it’s going to be a depression that the whole world will participate in. The WMI guy that I listen to the closest has been consistently right for the last eight years in his predictions, and has his money where his mouth is.
They all advise buying gold and buying it NOW. Since I have never owned gold, I was intimidated by the first dealer that I spoke with. I felt that I had better get informed before I proceeded any farther. So I bought the book "Buy Gold Safely" to see if it would enlighten me.
And enlighten me it did. This book is a no nonsense journey on what to expect when buying or selling gold and silver bullion, bars or coins. Beware of the pitfalls and up-sales that you will encounter when dealing with these folks. They have it all stacked in their favor with almost guaranteeing themselves a hefty (6-40 percent) profit by selling it to you and the same if not worse if you have to sell it back to them. If they will buy it back at all.
Now I’m not against profit, but give me a break. Let me give you an example of what Doug warned about in his book. Let’s just say that the current spot price for gold today (5/10/10) is at $1200/oz. If you were to approach a dealer (yes there are some reputable ones) or a coin dealer to buy some gold coins for investment just what would they charge you.
If you are buying bullion (an example is the American Gold Eagle) they will charge you the spot price of Gold plus a 6% commission so you would be paying about $1272/oz for each coin. On top of that you might have to pay city and state taxes depending on which state you live in. Of course they won’t tell you. You must consult your own tax accountant to find out.
Think that is bad, just wait. They will try their best to sell you investment type coins that are "proofs", "first strike" or coins can’t be "confiscated" or other collector type coins. These babies will set you back the spot price of gold plus a commission of between 30-35 percent. And those also might be subject to sales tax.
If for some reason that you want to sell these coins in the future, then what would you expect to get in return? In the case of bullion it would be the spot price of gold (say $1200/oz) less their "bid" price of say 6-20 percent and a 1 percent "liquidation fee" plus the insured shipping charges that you will spend. In the case of investment coins the "bid" price will be between 30-35% less if they will even buy them back at all. Plus the insured shipping and the "liquidation fee".
So buyer beware, buying gold is not without risk. I would invest the seventy dollars or so and read "Buy gold Safely" and bone up before I would commit. The price of gold would have to rise a lot before you could guarantee any profit if you were to have to sell them on short notice.
"Buy Gold Safely" not only goes into depth about the different types of gold and silver investment, but also where to purchase it, store it, how to invest using your IRA or 401K and much much more.
