If you don't have possession of your precious metals, you don't have, well anything, do you?

If you’ve been investing in precious metals then you’ve 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 it’s 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 you’ve purchased?

Bill Cramer 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 “I’d really like to take delivery of my metal – the five thousand ounces.” They go “well, that’s not possible.” And, I go “well, I’ve been paying storage fees since January of ’03, what do you mean I can’t take delivery.”

“Well, it’s part of the account. It’s called a pool account. And, you don’t take delivery, you just participate in the appreciation.”

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 that’s how I reconciled the problem of not being able to take delivery of my physical metal from a brokerage account.

Source: CNBC

If you’re 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 it’s 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 it’s just another paper swap. If there’s 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, it’s New York firms and brokers.

Be forewarned and forearmed.







Reprinted from SHTF Plan.



April 25, 2011

Mac Slavo [send him mail] is a small business owner and independent investor.

Copyright © 2011 Mac Slavo

A Simple Experiment to Disprove the Alleged Gold/Silver Price Suppression Schemes | zero hedge

A Simple Experiment to Disprove the Alleged Gold/Silver Price Suppression Schemes zero hedge

It should be a very simple experiment to disprove the price suppression theory. All you have to do is convert 10% of all of your gold and silver paper/ETF's etc... into physical gold that you take delivery of. Simple, just get everyone you know who is invested in gold and silver paper to do the same. If the physical gold and silver exists, there will be no problem. The issue at hand however is that the big bullion banks have been issuing paper and have created a fractional reserve system wherein they are not physically holding the gold and silver that the paper says they are.
Estimates are somewhere between 1 and 3% of all the paper that has been sold is actually backed by the metals that the paper guarantees.
When people finally get wise to this, there will be a run on the banks like no one could ever imagine. There is a metals bubble, but it's not going to burst, it's going to skyrocket. If you are currently in physical possession of precious metals, you will be the new wealthy class.