TGCI 31: Physical Gold/Silver as an asset class. Everything you need to know!

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Episode 31 - Physical Gold/Silver as an Asset Class - Everything You Need to Know

Show #31 - Dana Samuelson - Episode Art


In today’s show, Pancham interviews Dana Samuelson, President, American Gold Exchange, Inc. 

This show starts with Dana sharing a brief history of gold investing. Gold has been highly valued since ancient times. Right from the times of the kings and queens to the Great Depression to the World Wars, we share how these Black Swan events change the way we invest in gold.  

Next, Dana discusses the current economic situation and its impact on gold investing. Topics discussed include inflation, effect of printing more currency, the ballooning national debt and much, much more. 

You do not want to miss the practical tips that Dana shares towards the end of the show. In this segment you will learn how you can avoid getting scammed while buying gold. 

Tune in for some excellent insights!

Pancham Gupta
TGCI 31 - Dana Samuelson (1)
Dana Samuelson
Show #31 - Thursday - quote art

Timestamped Shownotes:

  • 01:50– As an investor, are you better off buying a physical asset like gold?
  • 03:19– Pancham welcome Dana from American Gold Exchange to the show
  • 03:58– Why is gold an excellent hedge against economic uncertainty?
  • 04:36– Dana shares his background information
  • 07:07– Why is the US dollar not backed by gold anymore?
  • 07:39– Why has gold been so highly valued since ancient times?
  • 09:59– Why was gold ownership made illegal after the Great Depression of 1929?
  • 12:10– How the US dollar became the world’s most powerful currency right after World War 2
  • 14:12– Analyzing the Gold Price Cycle from 1970 to 2020
  • 15:47– How inflation and printing more currency can provide a boost to gold prices
  • 18:32– Why gold is the go-to investment in a risky environment
  • 22:24– Dana analyzes the effect of supply-demand mismatch and increasing debt on gold prices
  • 24:16– Should you buy ETF’s? Are you better owning physical gold?
  • 26:33– Is it safer to buy sovereign-minted gold coins? What about gold bars?
  • 29:05– What are the dangers of buying gold from online platforms
  • 31:33– Is it possible to test the accuracy of gold bars?
  • 32:06– Does a Canadian Maple Leaf have higher purity compared to an American Eagle?
  • 34:25– What are tax benefits for US citizens who invest in American Eagles?
  • 35:37– What is the best way for storing gold?
  • 40:10– Taking the Leap Round
  • 40:20– When was the first time you invested outside the Wall Street?
  • 41:00– What fears did you have to overcome when you first invested outside of Wall Street?
  • 41:41– Can you share one investment that did not go as expected?
  • 42:53– What is one piece of advice that you would give to people who are thinking of investing outside the Wall Street?
  • 44:04– Dana shares his contact information

3 Key Points:

  1. Why gold is an excellent hedge against economic uncertainty
  2. Red flags to be aware of when buying gold
  3. Gold Bars, sovereign-minted coins, or ETF’s – which is the best way of investing in gold?

Get in Touch:

Read Full Transcript


Welcome to the Gold Collar Investor podcast with your host Pancham Gupta. This podcast is dedicated to helping the high paid professionals to break out of the Wall Street investments and create multiple income streams.

Here’s your host Pancham Gupta.

Pancham: Thank you for joining me today and I really appreciate you being here with me. I hope you’re enjoying the podcast and also learning at the same time. Nothing will make me happier if you use or implement one of the ideas that you get from the podcast. Also, I added a brand new functionality to the website where you can leave me a voice message if you have a question and I will play it in the Ask Pancham episode. Now let’s get into the show. Generally speaking in India, people like buying gold. Most of the gold purchases are in the form of jewelry. My late grandfather used to tell me that you should always own gold. As a kid. I never really understood the real reason behind it. I think I do now, but I can only imagine that this was what my grandfather’s reason was to at the time. You see, thousands of years ago, you would go to a store and trade your ounce of gold for a nice toga and a pair of sandals. Today, the same ounce of gold will buy you a nice pretty suit and a pair of shoes. Cold is money, and it has been for centuries. At some point paper currency was invented to make the tender easy, but it was backed by something of value like gold. What we have today is not money, but it’s a fiat currency. Fiat currency is money that Government has declared as a legal tender these days. Its paper with some ink on it intrinsically. It has no value. It has not backed by anything except for the trust in the government that issues that. When you think about it, it’s kind of scary, right? What gives our money value is the trust and faith in a regulatory body. What if people started not believing in the currency anymore? We have seen it happen in history multiple times. Usually it is the result of hyperinflation as seen in all Germany. It has already happened in modern times. Zimbabwe, Argentina, Greece, Venezuela are all examples of it to some degree. However, on the other hand, gold is finite, and has been real money for thousands of years. Owning it makes you sleep better at night. Should you own gold? I will leave that up to you to decide. But I personally I like owning gold. So if you are new to the concept of buying physical gold and want to learn how and what to buy, it’s probably a good idea to listen to the experts in this field. My guests today, Dana Samuelson from American Gold Exchange is one search expert. Dana, welcome to the show.

Dana: Thank you. It’s wonderful to be here with you.

Pancham: Thank you for your time today and I am so super excited for the show. Today we’re going to talk about this amazing, amazing money concept that has been in existence, believe it or not for thousands and thousands of years. So it’s great to have you on here. Are you ready to fire up my listeners break out of Wall Street investments?

Dana: Yes, I am. There’s a lot of fantastic reasons why gold in particular is a good alternative investment for your clients or your listeners, and why it’s more appropriate now than ever to have a little bit as a hedge against inflation, against currency devaluation, against economic uncertainty. Some people like a little. Some people like more than a little, but I will help people understand why it matters today more than ever.

Pancham: No, that’s great. That’s great. So before we begin, do you want to give a quick overview about your background to my listeners?

Dana: Yes, I’d be happy to. I’ve been in the precious metals industry for 40 years now. My entire adult career. I started literally at the kitchen sink working in a shipping operation for a coin company…counting, shipping, weighing, I went after two years in that position. I got a job with a company in New Orleans called Blanchard and Company and this one was a really lucky break on my part. Unbeknownst to me at the time, Jim Blanchard is one of the giants in our industry. We was personally responsible for the real legalization of private ownership of gold in 1974. After it had been illegal since 1933, and flush out that a little bit more in a bit but Jim was an icon in our business and an incredible guy. And I learned the industry from him. How to appraise older classic US gold and silver coins, how to buy and sell precious metals effectively. More importantly, which ones are appropriate for different investor profiles, whether you want to be very conservative or a little bit more speculative. I’ve risen to the ranks of the top echelon in our industry. I’ve been a member of the
Professional Numismatists Guild for almost two decades now and I’ve served as president of The PNG as well. It’s the leading organization of rare coin dealers in the country. And it’s an honor to have had been a president of that organization. I helped to establish an anti-counterfeiting task force that we now have in 2016, when I was president of the PNG, because we’re seeing some spurious items come in and out of China, and small, growing problems. So knowing what items to buy and who to buy them from is very important these days. And we’ll talk about that a little bit more as well. But I’ve literally gone from the kitchen sink all the way to the top of the industry on our inorganic path. Started American Gold Exchange in 1998, 22 years ago now, and we have an impeccable national reputation for doing what we say and saying what we do.

Pancham: That’s great. I would vouch for that, too. I’ve heard so many good things about you and your company. It’s just amazing. So you know, you touched on your introduction on some things that I want to touch upon, you know, which is about the history of gold and money. US dollar used to be fully backed by gold. And then at some point it was partially backed by gold. And then it was taken off, you know, off the gold standard by Nixon in 1971, I believe. And you said that it was also illegal until 1974 to own gold in the United States. So can you give us a little bit of history on the gold and how all of this came about?

Dana: Yes, well.  Let’s take a little bit, bigger step back. Gold and silver have been used as money since ancient times. You can go all the way back to, I believe its 1300 BC to King Tutankhamen in Egypt. And his famous burial mask was about 22 pounds of gold. Gold has been valued since ancient times, because of its unusual color, its scarcity and its malleability. So it was perfectly suited to be a metal, a precious metal that has a store of value. It takes about two tons of dirt in the mining operation to harvest one ounce of gold. There’s not a lot of it in the world. They say that all the gold that’s ever been mined that’s above ground today would fit in an Olympic sized swimming pool or maybe just something a little bit bigger. It’s not very much. So gold has been money since ancient times all the way through the 1930s. The US-made gold coins starting in 1795. Silver coins in 1793. Copper pennies used to be about the size of a half dollar because that’s what one cent worth of copper was worth back in the day. The gold price was fixed internationally from 1850 to 1933 at $20 and 57 cents an ounce. And in Europe for example, in 1878, I believe the Swiss 20 Frank, the French 20, Frank, the Italian 20 Lira and the Belgium 20 Frank were all standardized in size, weight and purity, effectively making it a golden euro of the day. Now, when we got into the what we call the roaring 20s, after World War One ended, and the stock market became a big speculative investment, gold was minted still as currency up until the crash of Wall Street and then for a few more years, but because of the problems with the crash in Wall Street in 1929 and the depression, Franklin Roosevelt had to do something drastic to stop the flow of gold out of the United States and into Europe in trade payments. And he wanted to be able to print more money, paper money at the time, so he called gold ownership in 1933, and made private ownership of gold illegal. In the early 20s. Of course, the German Republic went through the first bout of hyperinflation, which is why when we had a financial problem in 1929 that led to the depression in the 30s. France and Russia and other countries didn’t want paper dollars, and they wanted bags of gold. So when Roosevelt took us off the gold standard in 1933, for currency, they call the gold and by 1935, the International price of gold had risen from $20 and 57 cents an ounce to $35 an ounce. A 75 percent increase. And that increase in price made virtually every other country that was still making gold coins, which was the norm at the time. They stopped making gold coins. But so gold coins as money pretty much ended before World War Two started.

Pancham:  Okay, so a couple of interesting points there when you said in 1933, Franklin D Roosevelt made it illegal. So what they really did, they actually said, oh, now going forward, it’s illegal. So whatever you own, we will give you $20 and 57 cents per ounce for what you own. Give that back to the government whether it’s in the bank lockers or whether it’s in your, you know, own personal home. Give it back to us, we will pay you the fair value of what it is today and take all of it back and then essentially erode the purchasing power of the consumer and increase the value per rounds from 20.57 to 35. They devalued the purchasing power of the consumer. Is that what really happened?

Dana: That’s exactly what happened. And then we had World War Two start. And as World War Two was winding down, the Allies knew they were going to win the war in 1944. There was a meeting in Bretton Woods, New Hampshire, where over 150 countries were represented to discuss the future of the monetary system. After the world was war was over World War Two was over. And what they decided was because the US was still the richest country in the world and had the largest physical gold holdings of over 12,000 tons of gold, that the US dollar would become the world’s reserve currency. And it would be backed by gold of US and they wouldn’t be able to print any more money. Then it had ounces of gold in Fort Knox to back up that currency with and other countries would use the dollar as the world’s reserve currency so instead of other currencies being pegged to gold, now the dollar was pegged to gold and other currencies would trade against the dollar. That situation lasted until the late 60s when the Vietnam War was escalating. Richard Nixon became President and he needed to print more money than the US had gold to back it with no inflation at the time and deficit spending. We got another situation where countries like France wanted gold in payment instead of paper dollars, and our US stockpile dropped about 4000 pounds from 12,000 tons down to over a little over 1000 tons. And Nixon was forced to devalue the dollar by about 10% in 1971 effectively making the dollar instead of worth 135th of an ounce of gold, 138th and then 141st of an ounce of gold. And when that happened, he effectively broke the dollars back into gold and the dollar was no longer pegged to gold anymore. So now when they went of fiat money in the US first began, and if you look at the gold price in dollars in the 70s, when that happened, gold went from $35 an ounce to 38 to $41 an ounce and then we had the oil shock of 1973. Gold went from $40 an ounce up to $200 an ounce, and it corrected back down to about $105 an ounce in 1975 when us ownership was made illegal again in 1974. And then between 1975 and 1980. Gold went from $105 to over $800 an ounce as we went through another big bout of oil shock, and we had our hostages in Iran and there was a crisis of confidence in the United States. So gold went up four times down about 50%. And then up, up eight times, we’re going through a very similar price cycle from 2000 today. Gold is about $400 an ounce all the way up to 1900. Dollars and ounce corrected back down to 1150. And now it’s back up to 1575. In a breakout mode. I’m not saying it’s going to go up eight times from 1150. But we’re repeating the same cycle only instead of the US dollar being the fiat currency. The world has done the same thing we did in the 70s. Its printing money like crazy. Right? 

Pancham: No, it’s quite fascinating. That history that you just gave, right? People say that did we have inflation and you know, the houses are getting more expensive, the milk is getting more expensive. It’s not that those things that are getting expense. The value of the dollar is getting less and less, you know. Dollar is getting less and less in value, and it can be seen and all those things that you just mentioned. All those examples, and it’s fascinating that when Richard Nixon took it off the gold standard. So after that, you know, US dollar is at still kind of the reserve status for all and leading up to 2000. And it still does, but that has been challenged in last decade or so, given that anyone can print any money without any thing physical backing it. So it’s quite fascinating that central banks have gone to printing money and you know, extremely high rates. Creating money in essence out of thin air to liquefy the financial system that almost broke in 2009, you know. The US has $4 trillion dollars on its balance sheet, the ECB, the Japanese Central Bank and the People’s Bank of China. All the printed money to the total of about $22 or $23 trillion out of nowhere, you know. This total was about eight years ago. So that’s more than doubled over the last 10 years. And Fed Chair Powell said yesterday in front of congressional testimony, that if we go through another recession, they’ll Institute QE again, and perhaps see lower interest rates again, back down to zero. Or maybe even negative interest rates, which is very good for gold. If we go through another recession, they’ll be even more printing. So this could lead to a real crisis of confidence in the dollar. And we may see something quite tragic happening to the financial system, which is why having a little gold as an insurance policy is a very good thing these days.

Dana: Yeah, exactly. That’s how I look at it as well. You know, I don’t think of gold as an investment where I buy it for price appreciation. I’m thinking of It has a hedge against, you know. The devaluing of dollar which is going, which is happening as we speak. Because they’re printing as much as they can to make everything in less than value. I don’t even know like how to explain the feeling that I get when I actually buy gold. It’s a crazy feeling, you know. When you have a US dollar in your hand, you give it to someone, and it becomes someone else’s liability. Right? Paper dollar means that you know, this is for the listeners. I’m sure you can explain it even better. But US dollar, if I give you $1, it’s really US government owes you. It’s a liability on US government’s hands that they owe you $1. Whatever that $1 is defined by in today’s world, I don’t know what that’s defined by because in the old days, it was defined by gold. But in case of gold, it’s no one’s liability. If you own one ounce of gold, it’s no one’s liability. There is no third party involved. You own that. Free and clear, and it’s no one’s liability. It’s just amazing. So that makes you sleep better at night if you have some gold.

That’s exactly why gold is the go-to safety investment now in a risky environment because it has no counterparty risk. When you buy a stock, you’re betting on the performance of that company. When you own $1 or another country’s currency, you’re betting on the ability of that country to manage its finances properly, and to pay to represent value that that currency has seen. As you mentioned in the introduction, examples just now in the in the last year or two in Venezuela and Argentina, where the currency is absolutely collapsed because there’s no economy behind it to buoy the currency. Right? Here’s another great example in silver coins. The US took us off the gold standard in 1933 and took the gold out of the money but countries around the world continue to make silver coins into 60s and early 70s. The US made silver dimes, quarters and half dollars all the way until 1964. And it was our friend Russell Gray who taught me that if you have a silver quarter from 1964 and a quarter from 1965, you know they look about the same. But the 1965 quarter is a copper nickel like the coin in our pocket today. Well guess what? If you were to go to the gas station or the grocery store, that silver quarter from 1964 is worth about three bucks today. Silver value, it would still buy you the gallon of gas that you need or the gallon of milk that you need. Whereas the quarter from 1965 to 2020. It’s a quarter. You know, it’s a representation of what money used to be. It’s just currency. Money is something that has intrinsic value. So gold is really money. And if you look at purchasing of gold, physical demand over the last 10 years because of the financial crisis In 2009, it is absolutely exploded. But Americans are fickle. I’ve looked at how many Golden Eagles the US Mint makes every year. And there’s three periods of time where images of gold eagles are tiny, which is a proxy for physical demand in the US because the US men only going to make as many one ounce gold Eagles every year as the market will bear. And these three periods in the last 20 years when the managers have been tiny or 2000-2007, and 2017 18, and 19. And during each of these phases, stock prices were record highs, and Americans bought very little gold during these phases. But if you look at how many ounces of gold are being bought in Europe, or in China, or in India, the numbers are you know, multiples of what we’re buying here in the US. Especially in India and China and Japan, which have a hard money currency as you explained earlier in the podcast. And central banks are also buying gold at record paces today as a hedge against owning other governments bonds. I believe China is buying record amounts of gold. So as India, the central banks are booming demand. So we have physical demand that in a record rate right now. In fact, all the mines around the world make about 2500 ounces of gold out of the ground every year and physical demand is actually more than that 2500 tons. So the physical equation by itself is supportive of higher prices, let alone financial uncertainty over lower interest rates and the ever increasing debt. Now the US debt is going to go up a trillion dollars a year till 2030. And it’s crazy. That’s a 40% increase over the next 10 years and that’s assuming that our GDP is two and a half or 3%. You know, GDP for 2020 is expected to be 2%. So the equation is not good for paper money or our debt, but it’s very good for gold right now. So I think gold is going to go higher in price in dollars over the next couple of years, absent any kind of a financial crisis or recession, simply because of the numbers. There’s physical demand, and the debt just keeps increasing. And if we go through a period of economic weakness, that’s only going to make the situation exacerbated right now. 

Pancham: That’s great. Thanks for explaining all the history behind it. Now let’s get into how you know people who are interested in buying physical gold. I know in this day and age of electronic transfers, you can do on pretty much everything from a click of a button. And people like buying you know, ETS, a lot of people think that oh, buying gold is just if I go and buy GLD, which is one of the deals stricture presents. I actually own gold. Do you want to speak to just that like what’s the difference between buying GLD as an ETF versus buying actual physical gold?

Dana: Well, if you want to trade the gold market on paper, or the silver market for that matter, GLD and the silver ETF, SLV are very good ways to do it. The buy-sell spread is about a half a point which is, you know, traditional with stocks. It’s competitive. There’s no physicality to it. You’re simply buying or selling and betting on the price going up or down. And that is a very cost effective way to trade the trend. If you think the price is going higher, you buy it. If you think it’s going lower, you can sell it with physical gold. It’s a bit more cumbersome because you have to have the actual ounce, half ounce, quarter ounce, 10 ounce. You can get these different sized bars and coins and they actually come…Bigger bars come bigger as well but it’s got the BS manufactured. The intrinsic value has to be there. The purity has to be correct. And not there’s pure gold coins you can buy and there are gold coins that are about 90 to 92% pure that have a little bit of alloy adage to them to harden them up quite a bit. We call that the durable gold standard. Because pure gold is very soft. So if you want to have you know, trade the gold price, effectively, you can do it with a click of a button using the ETFs. But if you want to have true, real portable wealth that has no counterparty risk, and physical gold and silver is really the only way to do it. And that involves having a metal product. The men charge us two or 3% to buy that product whether it’s a Canadian Maple Leaf or a US gold Eagle.

Pancham:  Let me stop you there and a lot of people don’t even know what a Maple Leaf is? Can you break it down for the listeners? Like, you know, what are all these mains? From different countries like what kind of products they produce? And you know, like for example, American men produces American Eagle and Buffalo, right? And then we have the Canadian maple leaf, right? So how many of these are out there that you would recommend? Or you know, which are good buys in a good store of value?

Dana: So while gold was made illegal to own in the United States between 1933 and 1974, it was never illegal elsewhere. So in Europe, Japan, India, there’s a gold heritage. You alluded to the Indian heritage of jewelry, which is one form of buying gold. Most people when they think about gold, they think about gold bars. But starting in 1967, the South African men made the modern one ounce gold bullion piece. We call it a Kroger after Kroger who was the head of South Africa at the time. I’m not sure what the exact title was. The Canadian Mint started making one ounce gold Maple Leafs in 1978 is the direct competition to the crew grand, especially once the US market became open again in 1974. In 1982, the Chinese men started making one ounce gold pandas. In 1986, the US Mint started making one ounce gold Eagles which they’ve then supplemented with the buffalo design right after the old buffalo nickel from the 20s and 30s in 2006. So there’s many different sovereign minted one ounce gold coins today that didn’t exist in the 60s and early 70s. The reason most people today should buy a sovereign minted product. Because the bars…they traditionally think of have crude designs, and when we see problems with spurious merchandise, i.e. Chinese counterfeits, most of the problems are with bars because it’s much easier to replicate the look size and weight of a bar with tungsten and plated with gold than it is to replicate a coin that has been struck on a blank by dies. It gives it a unique look. Now, there, I’ve seen fake Maple Leafs and I’ve seen a few other. I’ve seen fake bars and they are very good. They won’t fool me but they’ll fool your listeners. Right? If your listeners want to buy gold, they should buy it from a long standing dealer who’s been in business for long time. Like myself. There are plenty of good options around the country. We’re a national mail order company and so we can do business with anybody within the United States, but we are seeing a growing problem with online platforms, where stuff is coming in out of China directly, though, to the US consumer, and it’s bad. You have to be careful. You don’t want to save $50 and find out that you, you know, lost 1500 in the process, right? That’s what happens.

Pancham:  So what do you recommend to buy, like, you know, these sovereign things, mainly not the bars?

Dana: Yes, I do. I do. People should think of the sovereign minted coins really is just round bars. That’s all they are round bars. For us investors. There’s two products that are the top two that are the most widely traded most competitively priced, and liquid anywhere at a reputable precious metals dealer, and they are the one ounce us gold Eagle minted every year since 1986, and the one ounce Canadian Maple Leaf minted every year since 1978 through today These are the top two one ounce gold bullion products traded in North America and the United States today. And that is what I would recommend your clients consider or your listeners consider. And that’s all I would recommend that they consider. Now you can get an Australian kangaroo, you can get an Austrian one ounce Philharmonic, you can get a Chinese panda. Yeah, they’re just as good. But they’re not quite as widely traded here in the States. The buy sell spread on physical gold is three to 4%. I know that sounds like a lot, but in reality, it’s actually very competitive. When you factor in that there is an intrinsic value there. It has to be made. It has to be right. It allows us a one to 2% profit margin which is tiny, considering it’s a 1500 1600 dollar item we make $15 to $30 an ounce, it’s really not a lot of profit, but it’s a very competitive market. If we try to make more you’ll find somebody else cheaper. So, these are the two products. I highly, highly recommend, if you want reliability of product, Authenticity, competitive pricing, and most importantly, if you want to ever sell liquidity, it will bring me bars today people bring me bars. Occasionally I do I test them the old fashioned way I get out of drill and run the drill through the bar, huh? No, I don’t have to do that with gold Eagles or Maple Leafs and we actually have testing devices that we use today that didn’t exist five years ago that will measure a bars density. Professional dealers have them it’s not cost effective for the average consumer to have them but we test everything that we buy and sell today. We make sure the product is good go coming in and of course going out. Okay, so that’s great. 

So by the way, you know, I get this question when I talked to my friends and you know, even now, you know we have this as an open discussion point where between American Eagle and Canadian maple leaf, there is this purity level. Canadian Maple Leafs they both have one ounce of gold, right? Canadian maple leaf is more pure in terms of the composition versus the American Eagles right? Do you have any preference between these two? Or how would you distinguish between these two that if you want to buy either one?

Dana: Well, as I said earlier, pure gold is very soft. So it scratches and dents very easily, which is why all of the coins that were made his money back in the 30s and earlier forever, have a little bit of alloy added to the pure gold content. It hardens it up dramatically. We call it the durable gold standard. Okay, so a Canadian maple leaf. If you take your thumb and run it over the edge of the coin with your nail, you’re going to scratch it. If you drop it from a foot or two onto a hard surface, it’s going to dent. It doesn’t affect the ounce of gold. But if you want to sell it for a small premium in the future, you know, dealer like myself buying that, it would see that as not quite a perfect minty fresh coin anymore. Instead of offering you the spot price or maybe a little 1% over the spot price, we would buy it a little bit of a discount. Gold Eagles on the other hand are one ounce of pure gold, but they have 907 ounce of other added. So they actually weigh 1.09 ounces and that little bit of copper and nickel that’s in them, hardens them up dramatically so they don’t suffer the same surface blemishes, scratches or dents that a pure gold coin like a maple leaf could get if you mishandled it. You know most of these coins are shipped from the men in tubes. They come minty fresh if you buy them in from a reputable dealer. You’re going to get what we call good delivery, perfect coins. You just leave them in the tube or counter or just be very careful with how you handle them. It’s basically, I say that one’s vanilla and one’s chocolate. What flavor do you prefer? Pure gold…some people like the American version. Now there is an advantage that gold Eagles have over gold Maple Leafs. If you’re the US taxpayer in 1986, the IRS imposed upon our industry, financial reporting requirements alike stock sales on a 1099 B. And at the time, Canadian Maple Leafs were deliverable against 100 ounce. COMEX futures gold contract so they deemed those as a reportable item on a 1099 B. However, the US Mint hadn’t even started making gold Eagles to that point in time so they never got on the IRS is what we call shopping list. So if you sell me 25 or ounces or more of Canadian gold Maple Leafs, I have to fill out a 1099 be when I buy that from a public person, not yours, but when I buy something from the public, but I don’t have to do that with us gold eagles. This has been the law for 34 years it could change. That’s the way it’s been for 34 years. So gold Eagles technically offer you some financial privacy the Canadian gold Maple Leafs do not enlarge your sales.

Pancham:  Got it? Got it. So, you know, I guess my final question here would be let’s say I decide on buying either one of them. How would you recommend people actually store this good?

Dana: Well, the rule of thumb is that you want to have it somewhere where you actually have 24 access to it in case you need it because the beauty of gold is its true portable wealth. I mean 100 ounces, weighs about eight pounds, and today its worth about $160,000. It’s smaller than a paperback novel. So having 24 hour access, but having it somewhere where it’s safe or not always the same thing. Now historically, for most of my career I’ve told people you know bank safe deposit box is the safest place to put it. But some banks are actually writing out you know coins or precious metals out of their bank box charters. That doesn’t mean you can’t put them in there. It just means that they don’t like it when you do and technically something were to happen you might have a problem with your storage if it’s with a safe deposit box. Now there are private storage facilities we can recommend to people that are independent of the banking system. This is usually for people that have a large value or in large size Mike my volume of silver I mean, the same hundred and $60,000 where the silver would fill up the table and boxes and boxes of 500 pounds you know silver coins and you need to will barrel the movement, which is why gold is the go to metal reportable wealth. Silver is actually your spending money in a crisis where gold is your portable wealth and the crisis. Finding it somewhere safe is the most important thing, storing it somewhere safe. And then there’s a lot of places that a house you can hide gold that no never know is there. But the most important thing is that more than one person knows where that gold is stored. Because if something happens to you, and you’re the only one that knows where your gold is, your heirs may never get it. Right. You also have to be careful of who you let into your house and knows where it is because I’ve had a lot of complaints over the years. Oh, you know, we had some workers come through and my watch one missing my gold coins went missing. You know, we had some health care workers in the house and they found our little stash and they took it so there’s a lot of places where you can store it, but you’d have to make sure it’s hidden number one and safe. In my old house. I used to have an in ground safe now I’ve moved.

Pancham:  You can get an inground safe I mean I had a right poured right into the foundation when I did a rehab on it and the safe cost about 800 bucks and you know it was highly effective for in house storage. The wall saves you. You can buy, you know both. Some people have guns, they put their precious metals and their guns safe. Now you can get a private insurance as well for your precious metals. Insurance companies like precious metals that are stored in safe deposit boxes because they hardly ever move. And banks have some of the best security systems in the country so that insurance premiums are typically very low. If people have larger precious metals holdings that they want insured, I can recommend a couple of private firms who specialize in our industry for that kind of insurance level. If it’s lot of money. And the storage systems that we recommend also are privately insured. And part of the storage fee includes insurance. In fact, that’s what most of the storage fee goes towards insurance value.

Pancham: All right, great. No, thank you for all those pointers. And we’ll be back after this message. Have you ever wondered why the rich keep getting richer? What is the secret that they know but you do not. What if I told you that wealthy people make their money work for them in two different places? Yes, the same dollars invested into different places and working hard for them while they sleep. They utilize these special accounts that have been in existence for more than hundred years. Do you want to learn more about these accounts? Then you are in the right place? Listen to the episode number five by going to Or visit So let’s move on to our next section of our show, which I call Taking the Leap round. I ask these four questions to every guest on my show. So Dana, for you, my first question is when was the first time you invested outside of Wall Street?

Dana: Well, I’m in the precious metals business. It’s what I know. So early in my career, I bought gold and silver and old classic us golden silver coins pre 1933. Because they’re fascinating to me. They’re pieces of real history. And I’ve built up a nice little collection over time of, you know, unusual pieces for either Rarity or a design or aesthetic appeal. So I’ve been in the hard money crowd for a long time. It’s second nature to me. So that’s when I first got started, because I knew it. It was easy for me. God got it. 

Pancham:  So did you have to overcome any fears when you did that, or there were really no fears you were young?

Dana: It was a bit of a leap of faith. When I first made my investments I didn’t know as much then as I know now, so I trusted people around me to help guide me, which is what everyone should do with something new. They should find an expert that they can rely on to help them and get a second opinion for that matter. But it wasn’t so much as a leap of faith because I had help that I trusted.

Pancham:  Good, good. All right. So do you have any investment that you can share with us? This did not go as expected?

Yes. You know, I’m in the hard money crowd. I do like mining stocks as well as a way to buy gold and silver on paper. And they were really the only choice. People had as a way to paper trade gold until the ETFs, GLD and SLV became available and 2007 and 2008 my think stocks, if you look at the price of gold as it oscillates up and down mining stocks tend to oscillate to a much greater degree, which is why people like them, when they’re hot, they get red hot, and when they cold, they can be real, you know, ice cold, and I bought, these are not things that you can buy and just hold blindly. And that’s the mistake I made. I bought some mining stocks when the stock market mining stocks were hot. These are actual companies to go in the ground and pull the gold out of the ground and businesses are not always the best. The or in the ground is not as good sometimes as they represent to me. And I lost some money on mining shares because I didn’t watch them properly like I should have I treated them as a buying old investment and that was a mistake on my part. I learned the hard way doesn’t happen again. I could but my last question is what is one piece of advice would you give to people who are thinking of investing in the main street that is outside of Wall Street? Would it be the same thing that you just mentioned? You go ahead.

Dana: If I was going to invest outside of Wall Street, I would, you know, understand my rationalization for my attraction to whatever that market is. No, I like real estate too, because it’s something that’s tangible. They’re not making a lot more of it. So I own rental properties here in Austin. But the main thing is to find an expert that you can trust that’s a specialist in that market. Understand why you want to be in that market. And like I said, get a second opinion. So if your advisors not the best you might, you know, get some devil’s advocacy to understand why it’s right for you what pitfalls you might see. It’s always best to do your homework, and that would be my advice.

Pancham: Great, man. Thank you for answering that question. Great advice. And so how can listeners reach you? You know, if they want to learn more about Q over your company or they want to buy from you.

Dana: Well, our company is American Gold Exchange. We’re in Austin, Texas. We’re a national mail order dealer. We have a very information rich and deep website, its If people want to email us for general information And we have an 800 number. You can call us anytime during business hours. 1800-6139-323. And I have four account managers on staff who’ve been with me all of them over 10 years, who I highly trust. I hire for trust first, and we’ve trained them all and our job is to help people understand what they’re most motivation is and what’s appropriate for what they’re trying to accomplish what their goal is. So we buy and sell with a consultative mind-set. We want to make sure that you’re happy with what you’ve done with us. So you’ll come back and do more business, perhaps refer a friend and we get a lot of repeat referral business because we treat people the way we would like to be treated with courtesy, respect, and intelligence.

Pancham:  I thank you enough for your time today. It’s great that we connected and all the knowledge that you shared with my listeners today. Thank you for being here.

Dana: Oh, it’s my pleasure. I’m honored to be on your podcast and I hope everyone does well out there, whatever their investment mindset is. Thank you.

Pancham: Thank you, Sir.

I hope that you guys enjoyed the conversation with Dina on the show today. I really appreciate for you joining me show notes can be found at Repeat. thegoldcollar If you have questions you can leave me a voicemail on the website. I can play it directly for my Ask Pancham episodes or you can email me at be at This is Pancham signing off. Until next time, take care.

Thank you for listening to the Gold Collar Investor podcast. If you love what you’ve heard and you want more of Pancham Gupta, visit us at and follow us on Facebook at The Gold Collar Investor. The information on this podcast are opinions as always, please consult your own financial team before investing

Show #31 - Dana Samuelson - Episode Art

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