Why on earth would anyone buy gold. What can you do with it and just Why really?

Realy

!!!!!!? wrote: »

You can trade on bullionvault.

Go to www.bullionvault.com and you can see their live prices. They are generally pretty close to official spot price, if anything they are ahead of the game a little.

Prices can be displayed in pound, dollar or euro and are expressed per kg and per troy oz.

Gold is currently selling around 17550 quid a kilogram. You're looking at an extra 200 quid to buy, given the spread.

Bear in mind that the pound is now plunging and gold is traded natively in dollars......

But do you get less for proper gold than paper gold? (I realy don't know)
I presume that you have to sell gold through a jewler or somthing if you hold it?
( I know this might sound a bit thick but I have never held it as an investment)

WTF?_2

Realy wrote: »

But do you get less for proper gold than paper gold? (I realy don't know)
I presume that you have to sell gold through a jewler or somthing if you hold it?
( I know this might sound a bit thick but I have never held it as an investment)

Bullionvault isn't paper gold. You are holding a share of real gold, held in vaults in London, Zurich and New York (you choose where to buy). Well, that's what they say and I believe them Basically, you trade with other BV members and they also buy in gold from the market.

To get hold of gold in your hand right now, you'll be paying well over spot price if you can find anyone selling. There were lots of anecdotal tales of a shortage of gold on the open market for the last few months, even when the spot price was going down. Plenty of rumours of the wealthy buying large quantities of physical gold.

Realy

!!!!!!? wrote: »

Bullionvault isn't paper gold. You are holding a share of real gold, held in vaults in London, Zurich and New York (you choose where to buy). Well, that's what they say and I believe them Basically, you trade with other BV members and they also buy in gold from the market.

To get hold of gold in your hand right now, you'll be paying well over spot price if you can find anyone selling. There were lots of anecdotal tales of a shortage of gold on the open market for the last few months, even when the spot price was going down. Plenty of rumours of the wealthy buying large quantities of physical gold.

But if you had gold in your hand like you do, who do you sell it to? (not being funny but is their specialists other than jewlers)
It is of interest as my wife as a braclet passed down which is over 2oz of 14K gold it might be a time to drop it.

Generali

Realy wrote: »

But if you had gold in your hand like you do, who do you sell it to? (not being funny but is their specialists other than jewlers)
It is of interest as my wife as a braclet passed down which is over 2oz of 14K gold it might be a time to drop it.

If you're trying to sell a bracelet then seeing a few jewellers is probably your best bet.

There are specialist bullion dealers but from what I've seen they pay a pretty lousy price on jewellery.

Realy

Generali wrote: »

If you're trying to sell a bracelet then seeing a few jewellers is probably your best bet.

There are specialist bullion dealers but from what I've seen they pay a pretty lousy price on jewellery.

i did not know their was bullion specialists. I would not take a bracelt to them now though. I dont want to be laughed at.;)

TDS_2

Yep, USD to GDP exchange rate is another variable in the mix. Gold in sterling is trading at extraordinary highs (gold in dollars has yet to break the $1025 price set in March this year).
A friend was asking me whether now was a good time to buy gold. I didn't know what to say. It's my opinion that it will continue to go up until early 2009, but buying at today's eye-watering prices adds a lot of risk.

WTF?_2

TDS wrote: »

Yep, USD to GDP exchange rate is another variable in the mix. Gold in sterling is trading at extraordinary highs (gold in dollars has yet to break the $1025 price set in March this year).
A friend was asking me whether now was a good time to buy gold. I didn't know what to say. It's my opinion that it will continue to go up until early 2009, but buying at today's eye-watering prices adds a lot of risk.

Tell me about it. I got in at a good level but foolishly I didn't have all my funds in the account (figured I'd dip my toe in). By the time I decided to move more cash in and the rest of my funds arrived in the account it had gone up by about 400 quid a kilo which made me back off putting that extra cash in ... and of course since then it has rocketed massively. About 3000 quid a kilo at one stage.

The higher it goes, the more downside risk you are exposing yourself to by buying in. And with the shoe-shine boy now talking about buying, well that doesn't make me confidant about getting any deeper in, despite seeing it go up and up.

On the other hand, it's D-Day for CDSs on Lehman defaults:

http://www.bbc.co.uk/blogs/thereporters/robertpeston/2008/10/day_of_reckoning.html

This could be the day when we see total market capitulation. However, if it's less bad than expected then there's a very good chance of a market bounce and a sharp drop in gold.

Shares are already a steal if you are going to hold them long term, like a pension fund for example.

TDS_2

!!!!!!? wrote: »

This could be the day when we see total market capitulation. However, if it's less bad than expected then there's a very good chance of a market bounce and a sharp drop in gold.

Shares are already a steal if you are going to hold them long term, like a pension fund for example.

Yeah, as a long term investment, shares are looking much more appealing. I'm assuming that gold will remain high (perhaps moving higher, who knows?) while all this plays out, but presumably there will come a time when it drops quite rapidly(?) as the fear disappears.

I guess there's an argument for starting to sell gold and putting that into shares? To my tiny brain that seems to make sense, but I'm sure there are other factors I've missed...

WTF?_2

TDS wrote: »

Yeah, as a long term investment, shares are looking much more appealing. I'm assuming that gold will remain high (perhaps moving higher, who knows?) while all this plays out, but presumably there will come a time when it drops quite rapidly(?) as the fear disappears.

I guess there's an argument for starting to sell gold and putting that into shares? To my tiny brain that seems to make sense, but I'm sure there are other factors I've missed...

There's definitely a crisis premium holding the price of gold up, where it is. Once the crisis abates, it should drop quickly.

However, once it stabilises at a lower level, could be a good hedge against sterling depreciation and possible inflationary 'rescue' measures that the governments might come up with.

But there's the whole Lehman defaults issue to be sorted first. This could be where the CDS s*** hits the fan. Then it will get crazy, very fast.

chucky

!!!!!!? wrote: »

But there's the whole Lehman defaults issue to be sorted first. This could be where the CDS s*** hits the fan. Then it will get crazy, very fast.

Not sure that will be the case today (for various reasons) but they'll have the WaMu Defaults as well to deal with.

That auction is somewhere around the 21st I believe.