Someone’s making money on Gold

November 7, 2008 – 11:07 am

by Rolfe Winkler, CFA

Seen the “Gov’t Gold” ad campaign running on CNBC? The one selling tenth-of-an-ounce gold coins for $98 each? Compare to the spot price for a full ounce of gold at $734. That’s a tidy mark-up.

You’d think the guys behind the ad would ask CNBC to shut off the ticker…

I know there’s plenty of debate as to the accuracy of the quoted spot price. Still, I thought this was a funny screen capture…

More on this topic (What's this?)
Gold Prices: Why You Shouldn’t Expect $1,000 Gold Anytime Soon (Investment U, 6/23/09)
I Think Gold has Bottomed (Gold Versus Paper, 6/24/09)
Gold bottoming (Gold Versus Paper, 6/22/09)

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  1. 7 Responses to “Someone’s making money on Gold”

  2. Actually looks like their premium, though high, is only a bit higher than your online providers — Apmex prices them at 91.27 (24% over spot vs 33% over spot for gov’t gold). Kitco doesn’t even have them available right now!

    Of course, gotta wonder about the sophistication of the investor who watches CNBC but then buys gold from a buyer like this (versus looking around for the best price).

    By justin on Nov 7, 2008

  3. got a link Justin? Just went to Apmex and eagles are going for $830.

    By RolfeWinkler on Nov 7, 2008

  4. Smaller than one ounce gold coins have higher premiums than one ounce coins and 1/10 ounce has the highest one.

    By john on Nov 7, 2008

  5. More importantly, what is their bid? (buy/sell spread)

    By bob on Nov 7, 2008

  6. Perhaps this is a recognition by dads buying for Christmans that the happy child who finds gold in his stocking this year will be getting 1/10 ounce, rather than last year’s full ounce?

    By Michael on Nov 8, 2008

  7. I thought those coins looked like the $1 coins.

    By joe on Nov 9, 2008

  8. I buy these sometimes because apparently I am not as well off as you guys. Last year I lost my job of 13 years as an engineer making telcom gear. So these are all that I can afford and I would rather have a little bit of gold than none at all. By the way, isn’t it funny that both the jobs and the physical gold are going to India?

    By b on Nov 11, 2008

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