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Precious Metals Expertise

Resources2017-04-27T22:12:55+00:00

Resources

The following links will provide more detailed information on numerous topics. If you have an area of interest and don’t see it listed below, please contact us so we can research if for you!

Precious Metals Resources Resources

50 Surprising Facts About Gold

  1. The word “gold” comes from the Old English word “geolu,” meaning yellow.
  2. There is more steel created per hour than there has been gold dug up throughout history.
  3. Around 161,000 tons of gold have been mined by humans.
  4. Gold can be found beneath the earth on all seven continents.
  5. It is believed that around 80% of earth’s gold is still buried underground.
  6. There is an estimated total of 10 billion tons of gold in the world’s oceans. That is 25 tons of gold for every cubic mile of seawater.
  7. The world’s first gold vending machine was unveiled in May 2010. Located in an ultra-luxury hotel in Abu Dhabi, the vending machine itself is covered in 24-carat gold.
  8. Most western economies’ currencies were on the gold standard until 1961.
  9. Switzerland was the last country whose currency was tied to gold. 40% of a Swiss Franc was backed by gold until Switzerland joined the IMF in 1999.
  10. The gold held at Fort Knox is accounted for by the United States as an asset valued at $44.22 per ounce.
  11. As of December 31, 1941 Fort Knox held 649.6 million ounces of gold.
  12. Today, Fort Knox holds about 147.3 million ounces.
  13. The size of a standard gold bar is 7″ by 3 and 5/8″ by 1 and 3/4″
  14. Alchemists believe they can change ordinary materials, such as lead, into gold.
  15. A carat was originally a unit of mass based on the carob seed used by ancient merchants.
  16. The most expensive gold coin in the world is the 1933 Double Eagle, which was sold at Sotheby’s in New York in 2002 for $7.59 million.
  17. Elvis Presley owned three cars manufactured by Stutz Motor Company, in which every part that is normally chrome was converted to gold.
  18. Former Tyco International CEO Dennis Kozlowski bought a gold-threaded shower curtain worth $6,000.
  19. A noble metal, gold is prone neither to rust nor tarnish and does not form an oxide film on its surface when coming into contact with ai
  20. There are 92 naturally occurring elements found in the earth’s crust. Gold ranks 58th in rarity.
  21. The chemical symbol for gold is Au, which is derived from the Latin word “aurum,” which means “shining dawn.”
  22. Absolutely pure gold is so soft that it can be molded with the hands.
  23. The melting point of gold is 2,063 degrees Fahrenheit.
  24. Gold is a great conductor of electricity.
  25. Gold is the most malleable and ductile pure metal known to man.
  26. An ounce of gold can be beaten into a sheet covering 100 square feet.
  27. In 1869, two Australians unearthed the world’s largest nugget of gold, the “Welcome Stranger,” which measured 10 by 25 inches before it was melted down.
  28. The largest nugget still in existence is the “Hand of Faith,” found in 1980 in Australia. It is currently on display at the Golden Nugget Casino in Las Vegas.
  29. A gold nugget found in the earth can be three to four times as valuable as the gold it contains because of its rareness.
  30. The heaviest modern gold bullion coin is Austria’s Philharmonic. In 2004, the coin, which has a weight of 1,000 ounces (31.1 kilograms or 69 troy pounds or 828 troy ounces) and a diameter of 15 inches, was dubbed the world’s largest gold coin by Guinness World Records.
  31. In 2007, Canada made a 100 kilogram (3,217 troy ounce), 0.99999 gold coin with a face value of $1,000,000.
  32. Pure gold does not cause skin irritations.
  33. Some sufferers of rheumatoid arthritis receive injections of liquid gold to relieve pain.
  34. Olympic gold medals were pure gold until 1912.
  35. An ounce of gold can be drawn into a wire 60 miles long.
  36. Two thirds of the world’s gold comes from South Africa.
  37. India is the world’s largest consumer of gold today.
  38. South Asian jewelry is generally more pure than western jewelry, comprised of 22 carat gold rather than 14 carat.
  39. Gold is the state mineral of California and Alaska.
  40. 90% of the world’s gold mining has been done since the discovery of gold at Sutter’s Mill in California in 1848.
  41. During the California gold rush, some speculators paid more for an ounce of water than they received for an ounce of gold.
  42. South Dakota and Nevada produce more gold than any other states.
  43. Scientists believe that gold can be found on Mars, Mercury, and Venus.
  44. The visors of astronauts’ helmets are coated in a very thin, transparent layer of gold (.000002 inches) that reduces glare and heat from sunlight.
  45. The Aztec word for gold, “teocuitatl,” was translated by Europeans as meaning “excrement of the gods.”
  46. According to the legend of El Dorado (the gilded one), an Andean chief who was covered in gold dust would make offerings of gold into a mountain lake.
  47. Evidence suggests that around 5,000 B.C., gold and copper became the first metals to be discovered by man.
  48. King Croesus of Lydia created the first pure gold coins in 540 B.C.
  49. When Franklin Roosevelt raised the price of gold from $20.67 to $35 in 1934, the dollar immediately lost 40% of its value.
  50. Henry VIII, Diocletian and Nero were infamous gold debasers, mixing other metals into gold coins and decreasing their value.

Why Gold?

  1. Gold is undervalued: As of this writing, the spot price for gold is near $1350.00 per troy ounce. In 1980, the previous record high price spot price for an ounce of gold was $875.00 which stood for 27 years. Factoring in inflation, the 1980 record high in today’s dollars is in excess of $2,550.00. Today’s price does not reflect a true unencumbered equilibrium value. Experts predict a gold bull run well into the next decade.
  2. Plunging stock market: Should the current stock market correct to a more reasonable price to earnings ratio as a result of the declining dollar, low interest rates and a slowing economy, investors will look for alternative assets like gold for effective portfolio diversification.
  3. Stagflation: Federal Reserve is pumping up the money supply at a rapid pace in the face of growing unemployment. This combination of inflationary/recessionary effects has not occurred in decades.
  4. Demand fundamentals: The demand for gold is at near-record highs globally. The only aspect of the gold market not inordinately high is individual investment demand in the United States. When conditions raise investors’ interest in gold, they will be greeted by a very tight market.
  5. Supply fundamentals: Gold supply is low because of tremendous demand from countries such as China, India and Russia. European banks have quietly been recalling their gold held at the Federal Reserve in the US. Central Banks have been net buyers of gold recently for the first time in over 3 decades.
  6. America’s debt bomb: Everyone owes. Home equity and the savings rate are down because Americans have been using their homes as ATM machines. Credit card debt is up, and bankruptcies are being filed at a record pace. Total governmental debt stands at $50 trillion, or $166,650.00 for every man, woman and child in America!
  7. Increasing weakness of the dollar: The fundamentals for the dollar are weakening. As the stock market declines, our existing ballooned current account deficit adds to the risk of a stampede away from the dollar. Should this happen, the benefit to gold will be twofold: as the dollar value goes down, gold will go up, and foreign investments in the U.S. will decline. This indirectly raises investor’s demand for gold.
  8. World tensions: Unfortunately, the failed wars in Iraq and Afghanistan have created severe tensions in several other global trouble spots (i.e. Syria, Iran, North Korea etc.). These countries could affect the financial markets for the next few years.
  9. America’s mushrooming trade deficit: Our trade deficit is at unmanageable levels, which could lead to a protectionist backlash at the very least. Gold is excellent protection against any unforeseeable problems as a result of the trade deficit.
  10. Rising commodity prices: Including gold, commodity prices have been rising for months. History has proven a disparity between commodity prices and gold does not last long. Continued record oil and energy prices will lead to inflation and higher gold prices.

Ownership Options

  1. Direct Physical Possession.
    The client takes physical delivery of the shipment and arranges for the storage of the metals in a manner they choose. Typical options include the use of a safety deposit box at their local bank or a home safe.
  2. Secure Third Party.
    Encore Gold can assist the client with choosing a secure third party to store the client’s metals. There are several locations available to choose from and all of them are safe, secure and full insured. Storage fees vary and will be disclosed prior to the client making a final decision.

Certified Coins

The Encore Gold philosophy regarding certified US Gold coins has always been to encourage customers to choose common date coins with the majority of the value of any individual coin being the fine gold content itself. Date specific certified coins can cost multiples of what a common date coin can be purchased for and unless a client is a serious coin collector, this is an area of the gold market best avoided.

Certain fractional size coins such as a $5.00, $3.00, $2.50 and $1.00 certified higher grade coins, even ones considered “common date”, can be very cost prohibitive and unlikely to sell at a profit. The retail customer will be most likely locked in to selling at the wholesale level which usually results in the customer realizing what the value of the coin truly is.

As with everything in life, there are no absolutes and there are exceptions.

Please contact us to discuss this area of the coin market if you have an interest at 1-877-563-8736.

CERTIFIED COIN GRADING

Certified – Available mainly in older American coins. These coins are graded by independent third parties, NGC or PCGS, sonically sealed in a plastic holder for protection and serialized. Coin grades range from MS-60 through Proof Quality. Certified coins respond quite well to changing market conditions. They currently sell for 20-30% of historic high values. They provide the investor with some leverage and should represent 10-15 % of a portfolio.

Proof – A specially made coin distinguished by sharpness of detail and usually with a brilliant mirror-like surface. Proof refers to the method of manufacture and is not a condition, but normally the term implies perfect mint state unless otherwise noted and graded as below.

Mint State – The Terms Mint State (MS) and Uncirculated (Unc) are interchangeably used to describe coins showing no trace of wear. Such coins may vary to some degree because of blemishes, toning or slight imperfections as described in the following subdivisions.

Perfect Uncirculated (MS-70) – Perfect new condition, showing no trace of wear. The finest quality possible, with no evidence of scratches, handling, or contact with other coins. Very few regular issue coins are ever found in this condition.

Choice Uncirculated (MS-65) – An above average Uncirculated coin which may be brilliant or lightly toned and has very few contact marks on the surface or rim. MS-67 through MS-62 indicate a slightly higher or lower grade of preservation.

Uncirculated (MS-60) – Has no trace of wear, but may show a number of contact marks, and surface may be spotted or lack some luster.

Famous Quotes

The few who understand the system will either be so interested in its profits or be so dependent upon its favors that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests.

– Rothschild Brothers of London (1863)

Although there are countless maladies that are forever causing the decline of kingdoms, princedoms, and republics, the following four (in my judgment) are the most serious: civil discord, a high death rate, sterility of the soil, and the debasement of coinage. The first three are so obvious that everybody recognizes the damage they cause; but the fourth one, which has to do with money, is noticed by only a few very thoughtful people, since it does not operate all at once and at a single blow, but gradually overthrows governments, and in a hidden, insidious way.

– Copernicus 1526

By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth.

As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.

– J.M. Keynes on inflation in The Economic Consequences of the Peace (p. 235-6)

Paper money eventually returns to its intrinsic value. Zero.

– Voltaire

Gold is Money. Everything else is credit.

– J.P. Morgan

The only function of economic forecasting is to make astrology look respectable.

– John Kennet

Central bankers continuing what is surely the greatest experiment in monetary policy in the history of the world. We are therefore in uncharted waters and it is impossible to predict the unintended consequences of very low interest rates, with some 30 per cent of global government debt at negative yields, combined with quantitative easing on a massive scale. To date, at least in stock market terms, the policy has been successful with markets near their highs, while volatility on the whole has remained low. Nearly all classes of investment have been boosted by the rising monetary tide. Meanwhile, growth remains anaemic, with weak demand and deflation in many parts of the developed world

Our Sterling exposure was significantly reduced over the period to 34 per cent, and currently stands at approximately 25 per cent. We increased gold and precious metals to 8 per cent by the end of June. We also increased our allocation to absolute return and credit, which delivered positive returns over the period, benefiting from a number of special situations. Within this category our new association with Eisler Capital had an encouraging start. We expect this part of the portfolio to be an increasingly important contributor to overall returns. Our significant US Dollar position has now been somewhat reduced as, following the Dollar’s rise, we saw interesting opportunities in other currencies as well as gold, the latter reflecting our concerns about monetary policy and ever declining real yields.

– Lord Rothschild, August 15, 2016

Charts and Data

chart 300x228 Resources

This up to date chart indicates what the Dow to Gold ratio is currently. You can utilize the information provided for in this chart for deciding when and what would be the right move to make when it comes to your Gold investments. If you have plans to buy or sell gold, then this is one of the most important charts that you must learn to understand. Buying or selling gold is a decision which cannot be taken lightly especially when large amounts of money and precious metals are involved. You need to try to eliminate emotions from the equation and view everything from a financial perspective. This will help you reach timely conclusions. Never try to buy or sell gold out of fear or desperation. Try to educate yourself so that you can make well informed and better decisions.

History of Gold

Gold is the oldest precious metal known to man.

The first contact man had with Gold is still unclear to this date, however it is recognized by the Archeological community that pharos and temple priests used Gold for adornment sometime around 3000BC. The first use of Gold as money has been traced back to the Kingdom of Lydia (western Turkey) in 700 BC.

In 1792 the Congress passed the US Coinage act. It invoked the death penalty for anyone debasing money and provided for a Mint where silver dollars were coined along with Gold coins beginning in 1794. The valuation for the nations new currency was set with Gold valued at $19.30 per troy ounce. This remained unchanged until 1834, when the price of Gold was raised to the $20.67 level which held for the next 100 years.

It was not until 1934 when President Franklin Delano Roosevelt devalued the dollar by raising the price of Gold to $35.00 per ounce. The stated reason was to raise commodity prices (especially farm products) and to create more employment for the millions who were suffering through the Great Depression.

In December of 1971 the Smithsonian Agreement was created by the worlds ten most industrialized nations in order to improve international economic conditions. Gold was raised to $38.00 per ounce. Unfortunately, international economic conditions continued to deteriorate and in 1973 the US Government was forced to devalue the dollar yet again by raising the official price of Gold to $42.22 per ounce. Finally, all international currencies were allowed to “float” freely against Gold. By June of that year Gold had risen to $120.00 per ounce in London. Exploding Gold demand set the stage for the trading of Gold futures on the COMEX in 1975.

In 1980 Gold briefly hit $850.00 per ounce as the demand far outstripped supply and the bubble burst. Since that time Gold has been in a bear market and finally bottomed out in the summer of 1999 against the backdrop the greatest financial bull market in the history of the world.

The subject of Gold is both timely and critical. Prudent investors are realizing that the bull market in equities is now over and alternative investments are the in order.

Diversify with Gold

Portfolio Diversification – counterbalance to cash, stocks and bonds

Asset allocation is a vital component when developing a strategy for investment. Asset allocation occurs whenever a portfolio consists of more than one asset class. The term diversification generally infers that the portfolio asset classes have been selected following investigation and careful selection. The term also is understood to mean that asset classes balance one another to reduce overall potential risk in the portfolio. Although not always the case until recently, it is now widely recognized that the addition of tangible assets such as physical gold should be included in the diversification of your portfolio – once again to reduce risk.

Beyond this, many investment experts are of the opinion that addition of gold to an investment portfolio enhances its performance. Gold holds immense potential during phases of economic uncertainty such as weakening of national currency and inflation. Gold prices remain independent when compared to different financial assets. This is because the parameters that impact the gold prices differ from the parameters that define the price of several financial asset classes. Investment consultants are of the opinion that this relationship can help in bringing down the volatility in portfolio.

According to the World Gold Council, gold is a cost effective, strategic and well-rounded asset. When gold is held even in modest amounts, it can help the investors to bring down the risk without having to make any sacrifices in the long term returns. With an increase in economic uncertainties, there is a need to diversify the portfolio. Paper currencies experience ups and downs. However, gold possesses an intrinsic value. Clearly, the addition of gold to a self-directed IRA can contribute significantly to the thoughtful diversification of a portfolio.

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