Many do not agree with Dylan Ratigan’s politics, but you have to love his outspoken nature when it comes to exposing crooks, corrupt politicians and scam artists.
Today, Goldline International, the maker of outrageously overpriced gold coins (e.g. an average of a 90% markup from melt value of gold in the actual gold coin) found themselves in his cross hairs after a NY Congressman calls for a Federal investigation after reviewing Goldline’s fearmongering tactics and misleading hard sell advertisements.
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Gold Coins & Huge Profit Margins
Look, I could care less about the politics involved in what will obviously be an escalation in a war of words between political pundits and news channels. That’s not why I post such a video since I hate politics with every fiber of my being.
I’m more concerned with people constantly being ripped off by the hard sell advertisers capitalizing on consumer fears, and just like any other fear trade, Goldline is capitalizing on consumers fear just to make a buck. When that fear, or greed in many cases, grows to substantial numbers, it creates herding behavior and can occasionally cause an investment bubble.
I’ve even gone so far to say we’re in a gold bubble (my opinion only), other professional traders have said it’s a gold bubble, but as always, you can buy whatever you want with your own money.
However, I do choose to echo Ratigan’s take home message: if you want to buy gold, gold coins, or other types of physical gold because you fear devaluation in paper (fiat) currency, don’t buy it from someone who charges a significant markup from the meltdown value.
It’s like buying your significant other a 24 carat gold piece of jewelry, paying 24 carat gold prices, but when taking it to the jewelry store to get it cleaned or appraised, you find out it’s only 12 carat gold.
Avoid Getting Ripped Off When Buying Gold
So, if you’re choice is to buy gold, my purely non-professional advice is…
- If you want to buy physical gold, silver, or platinum, buy from the United States Mint or from someone you personally know that won’t screw you over. Yes, the U.S. Mint has stopped production on various coins, but at least this way you’re playing it safe. Moreover, I would be highly skeptical of buying gold coins from a cheesy late night infomercial or TV commercial because goodness knows what you’ll get or what it’s actual melted down value will be once your order arrives, much less, what you can sell it for six months later in a pinch.
- The easiest way to buy gold is to buy the Gold ETF (NYSE: GLD). It’s one of the more volatile ETFs on the market, but it’s quite possibly the easiest, most convenient, and liquid way of buying or selling gold for the Average Joe investor. It’s not the ideal investment if you want gold in your hand, but still, it’s probably one of the best way to invest in gold if you want something quick and easy.
- Buy stock in the gold miners or the gold mining ETF. Buying the gold miners means you’re not only buying gold in their immediate inventory, as well as what they have underground. Buying individual stocks can be risky, so if you want to reduce your risk by diversifying across the entire NYSE Arca Gold Miners Index, the GDX is an easy and liquid way to do it.
- Buy a precious metals mutual fund or ETF. If you’re not sure gold is just right for you, and you want to diversify across multiple precious metals, there are numerous precious metal mutual funds and/or ETFs available on the market. Just find whatever you want, do your due diligence, and buy whatever you feel comfortable with.
Much of this isn’t exactly rocket science, and while I admit, advertisers can occasionally push all the right buttons and manage to hit precisely the right fear contagion neurons in all the right orders, but investing out of fear of missing out on big profits or that you’ll be the only guy/gal on your block who doesn’t have a shoebox full of gold coins is exactly the wrong way to invest.
