Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Costco gold bars are selling out within hours

cnbc.com

Post reply on HN
Print view View original

141–150 of 515 posts

Re: Costco gold bars are selling out within hours

#141

Post by cf141q5325 »

wodenokoto wrote: post #37
ggm wrote: post #8

I'd love to see an economists take on the value to a consumer of holding gold in this form, at the price. Investment gold is usually kept in vault, and you trade ownership arms length. Direct gold ownership is rife with risks: fineness, substitutions and overpriced purchase. Yes, you can always sell at a mall gold trader but that's way way off market price. So it's an inflation hedge with a lot of cost and risk and d…

I have some friends who are into owning gold. Their rule of thumb is: You can own gold mines on paper, but gold, only in hand. There is a belief that there exists a lot more paper gold than actual gold. So when the run on the reserves starts, the price of gold will explode as billions of dollars worth of gold in the market disappears. Although I’m not sure if Costco buyers are thinking like that.

Its not just a belief. The ratio is something in the region of 100x. Its also not just a precious metal thing, most markets function that way due to long and short positions. The paper market is always quite a lot larger then the actual one.

Re: Costco gold bars are selling out within hours

#142

Post by xnorswap »

worstestes wrote: post #135
nwiswell wrote: post #122

This is strange, apparently they're selling at a significant loss? Current online price, $1930. Spot gold, $1872.59. So a little less than a $58 premium. My credit card gives me 2% back, and my Costco membership 2% on top of that, for a total of 4%. I assume that Costco probably pays a bit more than 2% for card processing, and of course they're the ones actually paying me the 2% back from the membership. So that's at…

"Costco's credit card policy is all about saving money. It negotiates a partnership agreement with a single payment network in exchange for much lower processing fees. As part of its current deal with Visa, it pays transaction fees of only 0.4%. By saving on fees, Costco is able to keep prices low." https://www.fool.com/the-ascent/credit-cards/articles/why-do... They actually secure a very nice low rate via their cre…

By not demanding better legislation, you're still being ripped off. What you describe as a "very nice low rate" is higher than the legislated EU wide limit.

https://eur-lex.europa.eu/EN/legal-content/summary/fees-for-...

Re: Costco gold bars are selling out within hours

#143

Post by bsder »

ggm wrote: post #8

I'd love to see an economists take on the value to a consumer of holding gold in this form, at the price. Investment gold is usually kept in vault, and you trade ownership arms length. Direct gold ownership is rife with risks: fineness, substitutions and overpriced purchase. Yes, you can always sell at a mall gold trader but that's way way off market price. So it's an inflation hedge with a lot of cost and risk and d…

I'm really left scratching my head about people who buy gold to hold physically and personally rather than as an investment.

In any situation where it might be relevant, how are you going to sell your gold?

For example, if you bought one of those bars right now, how would you then sell that bar again right now?

And, if things really are completely collapsing, nobody wants gold. They'll want something much more immediately useful--food, clothing, ammunition, etc.

I did look at this to see if it was cheaper than any jewelrymaking gold I could buy, but the prices are bang on identical per ounce.

Re: Costco gold bars are selling out within hours

#144

Post by pjc50 »

Beijinger wrote: post #120
daymanstep wrote: post #118

Earlier quoted context omitted.

Where does the money come from for the dividend? If company profit or gold price goes down does the dividend become negative?

Nope. But please understand that I can't elaborate this since I still think it is a nice idea. But I give you a hint: I talked about precious metals, not gold. :-)

Plutonium ETF, where you literally can't hold it?

Re: Costco gold bars are selling out within hours

#146

Post by cf141q5325 »

ggm wrote: post #8

I'd love to see an economists take on the value to a consumer of holding gold in this form, at the price. Investment gold is usually kept in vault, and you trade ownership arms length. Direct gold ownership is rife with risks: fineness, substitutions and overpriced purchase. Yes, you can always sell at a mall gold trader but that's way way off market price. So it's an inflation hedge with a lot of cost and risk and d…

>I'd love to see an economists take on the value to a consumer of holding gold in this form, at the price.

I doubt you will find any unbiased opinion. Its important to remember that economists arent solely focused on the IS state. Its not a science, its perception management. The narrative is self fulfilling.

I really enjoy the npr article on the Brazilian inflation on this https://www.npr.org/sections/money/2010/10/04/130329523/how-...

The tldr is that the economy is what you think it to be.

Re: Costco gold bars are selling out within hours

#147

Post by defrost »

alsodumb wrote: post #114
defrost wrote: post #32

Earlier quoted context omitted.

Something I like about India is they actually use gold, unlike many other gold purchasers. India is a great source for beaten leaf gold - you can buy "books" of hand beaten tissue thin gold which is useful both for gilding idols and for other craftwork (eg: glassblowing).

This is something I haven't thought of! Growing up in India, I know that majority of the Indians have their gold in the form of jewelry, and man I've seen people with so much jewelry it's borderline insane (coming from a guy who'd call himself minimalist). I certainly haven't seen people in any other country use gold/jewelry as much as Indians do.

If you'd travelled to Africa prior to 1930 (ish) you'd have seen many areas where copper and bronze bangles, rings, Manilla's were worn on the body being a dominant form of currency in a number of regions for some centuries.

With gold, IIRC, some 45% of annual extraction goes to jewelry {decoration | investment}, roughly 10% goes to actual 'practical' use, and the rest goes to pure investment hoarding.

In many ways the vast amounts of energy and resource spent on gold mining are wasted almost entirely just to have something shiny that is conventionally deemed 'precious' because it is shiny (and noble - doesn't react).

The total practical use of gold is about 12% of total gold (10% new gold per annum, 2% recycled gold) with 88% of gold going to some form of hoarding | possession.

Re: Costco gold bars are selling out within hours

#148

Post by acatton »

nwiswell wrote: post #137
worstestes wrote: post #135

Earlier quoted context omitted.

"Costco's credit card policy is all about saving money. It negotiates a partnership agreement with a single payment network in exchange for much lower processing fees. As part of its current deal with Visa, it pays transaction fees of only 0.4%. By saving on fees, Costco is able to keep prices low." https://www.fool.com/the-ascent/credit-cards/articles/why-do... They actually secure a very nice low rate via their cre…

Fascinating. Visa-subsidized gold I guess.

Don't worry, Visa isn't subsidizing anything. At 0.4% they're most likely still making money, at a low margin, but still taking home a profit.

Credit card transaction fees in Europe are capped at 0.30%[1] and visa operates here.

[1] https://eur-lex.europa.eu/EN/legal-content/summary/fees-for-...

Re: Costco gold bars are selling out within hours

#149

Post by supermatt »

defrost wrote: post #7

Pfft, why settle for a 1oz bar when you can get a Mother and Baby Kangaroo 2023 2oz Gold Bullion Coin https://www.perthmint.com/shop/bullion/bullion-coins/mother-... from the Perth Mint? ( Or Dillon Gage, Texas: https://dillongage.com/coins/perth-kangaroo/ ) Buy one for your mother and two for your girlfriend, they're so cute you'll want more! Don't turn over if you're not into monarchies Caveats when biting the gold…

I love the idea of coins, but I wish they didnt have a value written on them - 200 AUD in that case - about 30x less than its material value.

I can just imagine someone inheriting my coins and spending them for face value!

Re: Costco gold bars are selling out within hours

#150

Post by adamredwoods »

AdamN wrote: post #106

What's the real spread on these things (i.e. how much can you sell the gold for directly after you buy it)?

Well... you cannot divide gold, unless you are using it specifically for barter. In today's market, if you split the gold bar, people will buy it from you at a lesser value than if the bar was whole.

If you sell the gold whole, I don't know of anyone that will buy it for it's true value in weight.

The best strategy for gold is buy and hold until the buyers will offer more than what someone bought it for.

Post reply on HN