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> Then the difference in price must be the small markup that branded stamped gold bars get. The bid/ask spread on the gold bars at the same dealer is close to

> Then the difference in price must be the small markup that branded stamped gold bars get. The bid/ask spread on the gold bars at the same dealer is close to 30%. The other markup is peanuts. That's why it gold as the "investment" is mostly sold via day time infomercial on second rate TV networks ( the ones that currently broadcast in 480i ) and second rate cable channels as well as promoted by the likes of Glenn Beck right next to "have your own seed bank so you can plant your own garden for food when the economy collapses". JPM made a lot of money serving those outfits but for it gold bar is just a blob of a certain weight and certain purity.

DennisP 7y ago
Someone else suggesting gold as an investment is Ray Dalio, who runs the world's largest hedge fund. As part of a portfolio, it helps because it's a largely uncorrelated asset that tends to do well when everything else is crashing. Of course, if you're doing that you're probably going to buying GLD or IAU, which closely track the spot price of gold. Or maybe you'll use an outfit like BullionVault, which has a spread comparable to large stocks, nowhere near 30%.
- notyourday 7y ago
  > Or maybe you'll use an outfit like BullionVault, which has a spread comparable to large stocks, nowhere near 30%. Which does not provide delivery of the gold bars.
- DiogenesKynikos 7y ago
  In a negative-interest-rate environment, gold is also more attractive, since 0% interest is better than -X% interest.
johnrgrace 7y ago
You are looking at the wrong dealers, the non "scam" dealers for say 1 ounce gold coins have a 3-5% difference between their buy and sell prices. https://www.providentmetals.com/1-oz-us-american-gold-eagle-coin-dates-our-choice.html https://www.providentmetals.com/1-oz-us-american-gold-eagle-...
- notyourday 7y ago
  These are not gold bars.
blevin 7y ago
This graph comparing 20 year total returns suggests another reason gold is considered by some to be a worthwhile “investment”: https://twitter.com/charliebilello/status/1166559145526550528 https://twitter.com/charliebilello/status/116655914552655052...
perl4ever 7y ago
I asked a discount broker about buying physical gold back in the 90s and was told it would cost about 10%.
- notyourday 7y ago
  "about 10%" becomes about 15% to buy. That's from spot price up. When you want to sell it, it will become "about 10%" from the spot price down aka about 15% in reality. Now do the algebra.

DennisP 7y ago

Someone else suggesting gold as an investment is Ray Dalio, who runs the world's largest hedge fund. As part of a portfolio, it helps because it's a largely uncorrelated asset that tends to do well when everything else is crashing. Of course, if you're doing that you're probably going to buying GLD or IAU, which closely track the spot price of gold. Or maybe you'll use an outfit like BullionVault, which has a spread comparable to large stocks, nowhere near 30%.

notyourday 7y ago
> Or maybe you'll use an outfit like BullionVault, which has a spread comparable to large stocks, nowhere near 30%. Which does not provide delivery of the gold bars.
DiogenesKynikos 7y ago
In a negative-interest-rate environment, gold is also more attractive, since 0% interest is better than -X% interest.

johnrgrace 7y ago

You are looking at the wrong dealers, the non "scam" dealers for say 1 ounce gold coins have a 3-5% difference between their buy and sell prices. https://www.providentmetals.com/1-oz-us-american-gold-eagle-coin-dates-our-choice.html https://www.providentmetals.com/1-oz-us-american-gold-eagle-...

notyourday 7y ago
These are not gold bars.

blevin 7y ago

This graph comparing 20 year total returns suggests another reason gold is considered by some to be a worthwhile “investment”: https://twitter.com/charliebilello/status/1166559145526550528 https://twitter.com/charliebilello/status/116655914552655052...

perl4ever 7y ago

I asked a discount broker about buying physical gold back in the 90s and was told it would cost about 10%.

notyourday 7y ago
"about 10%" becomes about 15% to buy. That's from spot price up. When you want to sell it, it will become "about 10%" from the spot price down aka about 15% in reality. Now do the algebra.