been investing in precious metals then youve likely made a
pretty decent profit on your wealth preservation investment over
the last several years. With the popularity of precious metals increasing
exponentially as the economic crisis and geopolitical climate heats
up, investors looking for protection against inflation and instability
have been pouring into precious metals ETFs, stocks, contracts,
and pool accounts. For many, the physical metal has become the investment
vehicle of choice, but a large portion of investors, especially
large buyers, choose to store those metals with their brokers/dealers.
When all hell
finally breaks loose, and its time to finally sell those assets
and trade them in for either paper currency, real estate or other
investments, how sure are you that you will be able to take physical
delivery of the metals youve purchased?
of St. Louis was pretty confident everything was on the up-and-up.
He purchased 5000 ounces of silver back in 2003 for a spot price
of $4.94 and stored them with an east coast broker. When he was
discussing his holdings with his coin dealer, the dealer dared him
to try and take delivery of the metal.
Bill took him
up on that dare and contacted his broker requesting to take delivery
of his supposed physical metal holdings, for which he had been paying
storage fees for years. As you may have guessed, the broker advised
him that physically delivering the metals was not possible:
So, I took
his dare, I called them up, it was June of last year. The metal
I had purchased in January of 03. I said Id
really like to take delivery of my metal the five thousand
ounces. They go well, thats not possible.
And, I go well, Ive been paying storage fees since
January of 03, what do you mean I cant take delivery.
its part of the account. Its called a pool account.
And, you dont take delivery, you just participate in the
So I immediately
sold that 5000 ounces at $18.33 and I had my cell phone in my
hand and I immediately purchased 2500 silver eagles at $18.41
and thats how I reconciled the problem of not being able
to take delivery of my physical metal from a brokerage account.
holding metals outside of your immediate possession (i.e. in a safe
deposit box, with a family member, an off premises safe or a hole
in your backyard), then we strongly suggest you understand what
your investment is and is not. If its paper, understand that
if and when the swindle in paper markets for precious metals is
finally understood by mainstream investors, and the paper assets
collapse, you will likely be left with nothing.
If you happened
to recently purchase
$1 billion dollars in gold and have it safely stored
in a New York bank several thousand miles away, you may want to
think twice about whether or not that metal is actually stored,
in physical form, or if its just another paper swap. If theres
one group of people who have no scruples whatsoever when it comes
to the investments and life savings of individuals for whom they
manage funds, its New York firms and brokers.