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Not All Metals Firms Are Interested in Your Success

Commodities / Gold and Silver 2010 Jun 02, 2010 - 02:57 AM GMT

By: Dr_Jeff_Lewis


Thanks to the surge in precious metals prices, we've seen quite a few new businesses enter the scene to either buy your gold or silver, or to sell you gold or silver.  Some are reputable, honest, and actually care about what you get for your precious metals.  Others are sly, overpriced, and likely riddled with salespeople far too interested in their own commission.

The Buy Gold Trend

Before the TV was dominated with offers wanting to sell you gold or silver, it was first overwhelmed with institutions wanting to buy your gold or silver for recycling. 

Of the most well known might have been Cash4Gold, a fly-by-night gold buyer that bought scrap metals through the mail.  While the commercials may have been frequent (even appearing in the Super Bowl), the company is no fairer or more honest than any other gold dealer.  Consumer complaints galore, most customers report that the average price Cash4Gold was willing to pay was right around 15-20% of the actual gold value.  Whereas you might mail the firm an ounce of gold for recycling, they would pay you about 15-20% of its actual value.  Other customers said that asking for more usually worked, but rarely pushed the payout scale past 30%. 

Of course, you didn't have to sell your gold, but you would have to ask for it back after already mailing it halfway across the country.  After just a few months, the trend fell out due to a shortage of people willing to sell their jewelry for pennies, and the company, though still operating, has ceased its aggressive marketing tactics.

The Sell Gold Trend

Just as soon as companies offering to buy your precious metals began to wind down, the number of companies offering to sell you gold and silver exploded.  Many companies took to the airwaves, hawking their gold and silver as some of the best on the planet and part of the safest types of investments. 

While we cannot disagree that gold and silver is an excellent investment, it isn't much of an investment at the prices these companies charge.  One familiar face of this movement is a company that began blending its brand with conservative commentators and media personalities in an effort to win over new clients. 

The firm, despite having quite the collection of coins for sale, is as dirty as those willing to buy your gold.  This company’s account executives are nothing more than overpaid telemarketers who push the costliest coins onto their clients.  The firm often touts high-priced foreign precious metals coins as a way to avoid confiscation, although most know that should the government confiscate precious metals, it will want foreign coin as well.  Of the worst offenders are European coins marked up some 90% from their face value, which are routinely pushed to buyers.  Of course, should you be smart enough to ask for their cheaper coins, they'll oblige, but only after trying to scare you into their numismatics.

Be Afraid

This article should serve as a reminder that you should be very concerned about where you purchase your metals.  In many cases, and with many financial-related industries, the sellers are nothing but sharks.  You're best off looking locally for investment grade bullion at local coin shops, where the staff is friendly and interested in repeat buyers.  As we all know, rarely do conned buyers become repeat buyers.

By Dr. Jeff Lewis

Dr. Jeffrey Lewis, in addition to running a busy medical practice, is the editor of and

Copyright © 2010 Dr. Jeff Lewis- All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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