« How to Profit from Gold Price Manipulation by Buying Gold Bullion Offshore | Home | What should you do if affected by the UBS Swiss Banking Scandal? »
The Dangers of Investing in GLD
By admin | February 28, 2009
When is gold not gold? When it’s GLD!
More and more questions are being asked about GLD, the world’s largest Gold exchange Traded Fund by far. For months I have been advising clients NOT to buy gold through GLD. If you are buying gold you should buy the physical metal whch actually clunks and clanks when you move it around.
The problem is, of course, that people think by buying GLD through their offshore brokerage accounts, they are buying gold. “Given that the stated amount of gold in the GLD Trust has grown to over 850 tonnes, it appears that a lot of investors believe that investing in GLD is the same thing as buying physical gold bullion,” says Dave Kranzler at gold website Le Metropole Cafe.
Nothing, however, could be further from the truth. According to GLD’s own prospectus, published when GLD was launched back in 2004, “This ETF is intended to track the performance of the price of gold.”
In a recent article entitled Ten Reasons to Avoid the Gold ETF, Financial Foghorn says:
Note that it doesn’t say it will own gold, or anything so prosaic. This Exchange Traded Fund that promises easy gold ownership for America is only going to track it. You know, like your cat tracking a crow in the back yard. And if GLD or your cat never quite gets there, well, it was an interesting exercise.
A careful reading of the first sentence should tell you that this is a document written by lawyers, and it is intended to be read by other lawyers who might be thinking of suing the guys represented by the first group of lawyers. The opening sentence is nothing if not defensible.
That is just the first of the ten reasons FF gives for not investing in GLD. You can read the rest of the article at the link above, and while you are at it you might also like to check out another good article, entitled Another Problem with the GLD ETF.
As I’ve said, ETFs may be a nice way of speculating. My own personal investment vehicle used to own substantial holdings in GLD through our Panamanian bank account, and in dollar terms we did very nicely on it thank you! But we liquidated all holdings as soon as it became clear that digits in the banking system are just not a replacement for real gold.
What then, is the solution? Well I actually have not one but three solutions for those who are interested in buying gold offshore. Three unique solutions, quite apart from the more obvious ones like buying physical gold bullion from your local bank or bullion dealer. Three unique solutions for buying gold completely offshore, in many cases anonymously, at least with the privacy and asset protection afforded by an offshore company. One of these methods I find particularly interesting – it’s a way you can securely buy golddirect from the mine, so as to speak, completely bypassing the banking cartel that would like you to believe that GLD is the same as GOLD!
You’ll be even happier to know that a report detailing these three solutions is yours FREE just for being a member of The Q Wealth Report, publishers of The Gold Report. It’s available right now for download in the Members’ Section at Q Wealth Report. If you’re not yet a member, this is an excellent opportunity to obtain not just my GOLD report, but lots of other useful information pertaining to offshore banking, wealth creation, asset protection and – perhaps most important of all – your personal financial privacy.
How and Where Can You Safely Store Your Gold Bullion?
In The Gold Report you will also learn how and where you can safely store your physical gold bullion once you have bought it. Besides a discussion of the pros and cons of storing your gold onshore in places like the USA and the UK, I also cover accessible and private storage methods in Austria, Switzerland and the Caribbean. And the storage method I recommend in Switzerland is NOT in a bank. Some of these storage methods are surprisingly cheap too!
All this is yours free as a member of Q Wealth. If you are not already a member, Join Q Wealth Today!
Want to read more? I’ve recently published an article at Q Wealth about How to Buy and Hide Gold Bullion Offshore.
No related posts.
Topics: Currencies and Cash, Investing in precious metals | 1 Comment »
One Response to “The Dangers of Investing in GLD”
Comments
You must be logged in to post a comment.
March 2nd, 2009 at 8:18 pm
[...] not about paper or virtual gold like ETFs. I have blogged over on my personal site before about the dangers of investing in GLD ETF, and – for that matter – other commodity ETFs. Journal reader Alex Vasilyevich points out: “I [...]