Wealth Podcast Post

Investing in Gold Coins with Dana Samuelson

George Grombacher April 6, 2023

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Investing in Gold Coins with Dana Samuelson

LifeBlood: We talked about investing in gold coins, bars, and other precious metals, how they fit into your overall financial situation, how the precious metals market works, the danger of counterfeits, and how to get started, with Dana Samuelson, Founder and President of American Gold Exchange.   

Listen to learn the steps to take to buy your first gold coin or bar!

You can learn more about Dana at AmerGold.com and LinkedIn.

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Our Guests

George Grombacher

Dana Samuelson

Episode Transcript

george grombacher 0:02
Well I’m left with this is George G and the time is right welcome today’s guest strong and powerful Dana Sam Samuelson. Dana, are you ready to do this?

Dana Samuelson 0:32
Well, I’m married, I’ve got two kids, I’ve got a 10 year old boy and a five year old daughter. I’m not the youngest man on the planet.

So I’m also backyard guitar player. My wife is a musician. So we’re trying to teach our kids music and addition to the ways of the world.

I’m a physical precious metals dealer out of Austin, Texas. I’ve been in the precious metals business for 42 years, I have a national reputation that is good. And I try and help people understand why precious metals are a good fit for any financial portfolio. Or as a hedge against financial uncertainty, inflation.

And the history of money, basically, vintage coin dealer dealing in US coins minted since 1793. These are pieces of history that people can own in their hands for not that much money. And we’re basically custodians of these pieces, you know, we really don’t own them as much as we hold them for a little while before we pass them on to the next person. They’ll survive us.

How countries trade with each other is important and gold and silver are an international currency. They are not beholden, be beholden to any government. They’re accepted universally around the world. And having a good sound financial education is important. I’m friends with Robert Kiyosaki, whose book Rich Dad Poor Dad is one of the best selling books in the in the planet about finances and how to attain wealth and gold and silver tend to hold their value over time, where the money that our politicians keep printing becomes diluted through more and more printing, our debt was $5 trillion in 1995. It’s gone up six fold to three $30 trillion. Today, gold was $300, an ounce in 1995. And it’s $1,800 announced today, it’s going up to six fold over that same timeframe. While the purchasing power of our dollar has just continued to erode, especially over the last year or so with inflation. Everybody’s feeling it. If you had one of the buy eggs with gold or silver two years ago, you’d still get the same amount of eggs today with that same amount of gold and silver, but you’d have to pay a few dollars more to get that and having a financial education that understands these things is important. And gold and silver are a small part of that overall picture. But everyone should be aware of them.

Unknown Speaker 0:09
Yes, sir. I am George. Thanks for having me.

george grombacher 0:12
And excited to have you on let’s go. Danna is the founder and president of American Gold Exchange. They’re leading national precious metals and rare coin company specializing in dealer dealer trading, as well as direct to consumer sales. Dana, tell us a bit about your personal life smart about your work and why you do what you do?

Unknown Speaker 1:39
Well past us. Well, I

george grombacher 1:41
appreciate that. So your wife, is she the singer? Is she the drummer? What’s what’s going on here?

Unknown Speaker 1:49
She’s a singer songwriter. She’s got one CD out. That’s that’s quite good, actually, even if I must say still, but she’s semi retired now with a young daughter that we have. So I expect it will come back on the scene in the next few years.

george grombacher 2:03
Okay, perfect. So in terms of the literacy or the education around precious metals, we were talking that obviously, precious metal has been around for as long as the Earth has been around and human beings have been using precious metals to trade for a really, really long time. But where is the current level of literacy around where precious metals fit into somebody’s personal financial situation?

Unknown Speaker 2:29
Well, I think one of the weaknesses on our country unfortunately, is that we don’t give kids coming up in school, a good financial education, and learning about finances money, how markets work.

george grombacher 4:13
That’s always been the that’s been a sane or a rallying cry or a truism that, that gold is a hedge against inflation. So now that we do find ourselves actually experiencing I almost said enjoying experiencing inflation. How is gold doing for lack of a better term?

Unknown Speaker 4:33
Well, it’s actually underperforming a bit right now, because of the currency market. You know, over the last year. I don’t want to get too technical. But over the last year, the US economy was the best economy in the world. We have the highest interest rate compared to every other country. And we were safe because of the war in Europe, primarily with the war in Ukraine. So a lot of money from around the world came into the United States and the gateway to the As the dollar, and the dollar was bid up about 18%, against most other currencies at one point last year, which is an enormous gain. And that pushed gold and silver prices down to cyclical lows, which is contrary to what most people would think, in an inflationary environment, but it was more of a currency play than it was a precious metals play. During the inflation of the 70s, silver really ran hard, but on the backside of inflation, when inflation really got sticky, and we haven’t quite gotten to that point in this cycle yet, we’ll just have to see how well the Federal Reserve does in trying to contain inflation. But we may get, you know, a weaker economy a recession because of the higher cost of money. And gold and silver tend to do well when things don’t go so well. Otherwise.

george grombacher 5:54
Appreciate that. So we’re certainly not giving anybody financial advice. But if it works, you know, just just just use an avatar of a 40 year old investor who is has a 401k and they’ve got a brokerage account, and they own or own a home. Gold’s silver precious metals, Platinum could be an additional vehicle or additional way to to be investing money.

Unknown Speaker 6:22
Right? A good hedge is about 567 percent of assets gives you enough where you get to counterbalance against times of trouble or uncertainty without taking opportunity from other markets, real estate, stocks, bonds, whatever. So you having a little bit as a good thing. I’m not saying people should, you know, go all in. But having a little bit makes a very much financial sense.

george grombacher 6:50
And in terms of, of the markets, it’s a it’s a fascinating thing, and something that that to your point, we don’t necessarily have that firm have a grasp of I think that we understand the stock market, I can go and buy and sell shares. Probably people understand the real estate market, because it’s all over the news and it’s splashy when home values go way up or when they go way down. But we understand that, how how does the precious metals market work? I know that’s a big question. But

Unknown Speaker 7:20
well, there’s um, there’s a couple different ways you can invest in precious metals. I’m a physical precious metals dealer. So I deal with physical ounces of gold or silver, platinum or palladium that are made by refineries, or sovereign mints like the US man, the Canadian men, British mint, they all make their own what we call bullion coins today, which are gold and silver pieces, made simply for gold and silver sake, they have a small premium over their metal content, then you can hold it, you can own it, it’s a way for you to take some of your dollars, take them out of the banking system, have a savings account, in precious metals instead of in the bank. You know, savers, if you have dollars in the bank, you know, you lost three, four or 5% Last year, inflation net interest rates. Gold and silver have held their value about the same year to year. So they’re holding up right now, you can invest in exchange traded funds, which is a way to trade gold and silver price movement on paper. That’s the way to harness the changing in the precious metals prices. If you’re a trader, you can buy the stock in companies that mined gold and silver, but that you’re buying a business that happens to pull gold and silver out of the ground. So it’s not only the deposits that they have, what quality of those deposits are, it’s how good is the company running those. And you tend to get a little leverage to the metals price with mining stocks. Because if the gold price goes up $100 The company’s profit margin might double. But it goes both ways. So they’re they’re volatile. Gold and silver tend to be kind of boring in the long term. But it’s a nice way for you to have safety and a portable truth, portable, transferable wealth that you can carry, you know, 100 ounces of gold is $180,000. Today, it’s the size of a paperback novel, and it’s very easy to transport and that’s why people have always used gold. It’s dense value.

george grombacher 9:20
100 ounces of gold is worth $180,000 today about that. Okay, so bars versus coins. Was there what’s what’s, what’s the thought process the wisdom

Unknown Speaker 9:34
I recommend the sovereign minted coins which are struck by dyes onto a blank which create an image bars that are made by private refineries are much simpler in design, where a coin that a sovereign mint makes to have more intricacy and there are characteristics to that strike that are recognizable to precious metals dealers like my myself, we have a modest but growing problem with Chinese counterfeits, and they’re faking bars, more than that are faking the softer and minted points because their bars are easier to replicate. So the most important advice is deal with a long standing precious metals dealer. Don’t don’t recommend some of the online platforms where you can buy on the computer and find someone has a good reputation to deal with. It’s not a big problem, but you don’t want it to be your problem. So find someone you can trust in the industry if you want to own physical precious metals. And the sovereign minted coins are the best way to go for saleability in the future, in my opinion.

george grombacher 10:43
So what does that mean counterfeit gold bar, does that mean? There’s some gold on there, but also some lead in there something like that?

Unknown Speaker 10:51
Yeah, basically, they’ll take a metal like tungsten, which has a density that’s similar to gold and put a small plating of gold on it. To get it the right weight, it won’t quite be the right size, we have testing devices we use, it can reveal that it’s plated instead of pure. And you know, if worse comes to worse, we can put a drill through a gold bar to see if it’s gold all the way through. And I’ve actually done that at points in time in my career. So it’s not it’s not a big problem. But if you stick with sovereign minted coins that have intricate designs, that’s really where the rub is for the fraudulent pieces. They just can’t make them look good. They might look good to you, but they wouldn’t look good to a professional like me.

george grombacher 11:44
What what what are some of those the those kind of tells or tip offs when when when you’re looking at a fake?

Unknown Speaker 11:52
The colors always a little off the the vibrancy of the surfaces is not quite right. There’s a sound, gold and silver, when they touch each other, they make a specific pitch. And when I count gold coins or silver coins, I listened to them. Plus, we have testing devices that are fairly sophisticated that aren’t that expensive, that we can use, It’ll measure density, and give us a true rating or not. But more and more. It’s its look and feel. And it’s just something you learn over time. You know, this was bad. I hate to be so simple. But that’s basically what it is experience.

george grombacher 12:30
Yeah, no, I absolutely believe that.

Unknown Speaker 12:34
But the just to further further that a little bit of the men’s these days are adding design elements to the bully on pieces that make it harder for the counterfeiters to replicate us gold eagles, the new ones that one ounce gold coin the US Mint is making. They have those denticles around the edge. Well now they’re missing one on the new ones that they’re making. This is an anti counterfeiting element in the design. It’s not hard to make one one of those denticles or ridges go away but it’s impossible to make them go away in the same place on every coin, which isn’t how they’ve done it. And it’s it’s really quite smart.

george grombacher 13:16
How many I don’t know if it’s knowable or not how many of these these these gold coins are being minted every day, or yearly?

Unknown Speaker 13:24
Well, bullion coins it’s It’s millions of ounces on an annual basis. For gold and silver. There’s a pretty good appetite these days for physical precious metals amongst the US public. But it’s only about five to six 7% of the public really owns or knows about precious metals, which is why having a basic education is important. You know gold and silver perform just like they were supposed to following the great financial crisis of 2008 when the banking system almost came apart at the seams. And gold and silver have responded well to the increase in our debt over the last couple of years due to COVID. So it’s important that people know about this that’s why I’d like to do you know podcasts like yours, too. I can help spread the word and and if we can help people learn that’s really what my business does. We try and help people in a consultative way, you know, understand what might be best for them if they’re interested in this. What’s a good proportion, and what products might be best, although we stick with the main stream items, us man, Canadian Mint, Austrian men, we do a lot of business in those three minutes because they’re the most popular, competitively priced and widely traded bully on items.

george grombacher 14:44
That makes sense. So I think I understand how to actually buy them. Should I decide that I’m interested in in in in turning them back into US dollars? How does that process work?

Unknown Speaker 15:01
Well, if you have a dealer that you’re working with, usually selling back to the dealer that you purchase from is your best option. Because they’ve already looked at the product, they’ve ended it, you know, any good dealer will no good product. That’s pretty simple. I’m a member of the professional numismatists guild, which is the leading organization of rare coin dealers in the country, but we also have bullion businesses, we tend to be the long standing members of the community with with good reputations. So I would look for a professional numismatists guild, PNG member dealer, if you want to buy or sell precious metals in your hometown, and there’s some good mail order companies. We’re a mail order company, my company, but some people want to do business locally, but the PNG member dealers are typically the dealers you can have the most faith in

george grombacher 15:56

Unknown Speaker 15:59
that’s just a fancy word for coin nerd.

george grombacher 16:01
Okay. I like it. I don’t know that I’ve ever heard that word before.

Unknown Speaker 16:07
Stamps, filth. philatelist. No points misma test, it just means the study of that item.

george grombacher 16:14
Outstanding. I love that. All right. So walk me through the buying experience, I come to American Gold Exchange, I’m I am a regular person that is not a numismatist. And I know very little about it. But I say you know what, this this, this, this makes sense.

Unknown Speaker 16:30
So if you want to own physical gold and silver, the the gold and silver price move up and down all day long, five days a week, just like stock prices do so at a point of sale, we have to pick the whatever the metal price is, at that point in time. That’s the underlying basis. So for gold, it can be $1,800 An ounce 1805 10 minutes later, you know, 1803 10 minutes later, we pick that price at the point of sale. And we’ve picked out what product you want, whether it’s a US coin, a Canadian coin and Austrian coin. There’s a small premium for manufacturing and distribution, and profit, which would make your purchase price on gold about 4% over the gold price, maybe 5%. And silver tends to be $1.50 to three or $4 an ounce, depending upon the product, whether it’s a one ounce coin, or you can buy 100 ounce bars, which are cost effective. And then that’s the price that you pay, when you go to sell, you’re going to get about three or 4% less for that same ounce of gold, or about $1.50 less for that same ounce of silver, that’s the Buy Sell spread, it’s not as efficient as buying a stock on paper because there is has to be perfect. So these are not items that are good trading vehicles. But if you want to own precious metals, it’s really the only way you can go. And like I said, it’s you should look at as a savings account that you’re going to put money into that you really don’t want to touch unless you have to. That’s your long term savings account. And it’s something that will hold value better than dollars will. But it’s simply just like buying anything else except the price goes up and down. And there’s a difference between the buy price and the sell price. When you sell we lock in at whatever the metals prices at that point in time.

george grombacher 18:27
Who sets the metals prices?

Unknown Speaker 18:32
Well, we do this on the commodity exchange the COMEX Exchange, which is a futures exchange where the buyer contracts are bought and sold in large volume 100 ounce contracts of gold 5000 ounce contracts of silver. It’s a way for mining producers to hedge their inventory. Just like you can buy cattle futures or corn futures, the way farmers can hedge their product, the crops in the ground, they know they’re going to sell a product in April that they’re not going to deliver till October, as if you’re a farmer, that’s why you do it. So you can hedge that’s where the metals prices are truly said it’s a paper market and it can be bullied around a bit. There’s a lot of money in the world today and the golden silver markets are kind of small. So when a big big buy and sell orders come into the market the the gold price can be a bit volatile. We’re also affected by finance, what’s going on with interest rates what the Federal Reserve is doing is affecting the metals prices right now. We’re affected by geopolitical events, tension in the world whether or peace good economic activity versus you know, not so good economic activity. So all these things affect precious metals markets, which and make the gold and silver price go up and down on the futures exchange which is where we derive our spot prices from it’s it’s always interesting for me because something’s always is going on keeping these markets moving. And you know, things change. So I’m kind of a current events fan and I like to follow finances. So there’s always something that’s affecting our markets. And that’s another reason people if they own a little bit, they have a vested interest in it. It makes them want to follow these markets and Silver’s easy. It’s much cheaper to buy does the point of entry to have a little bit? It’s not hard. As I said, my right my friend, Robert Kiyosaki one day he’s like, what’s this Bitcoin? Five minutes later, he bought Bitcoin on his phone, he said, if I own it, I’ll follow it. Right, so it’s a good way to have a little skin in the game. Yeah,

george grombacher 20:39
makes a lot of sense. Well, Dana, thank you so much for coming on. Where can people learn more about you and American Gold Exchange?

Unknown Speaker 20:47
Well, we’re a physical precious metals dealer out of Austin, Texas. Our website is www.amergold.com Amor gold, our email addresses info inf o at amor gold.com. We have a information rich website, we have transparent live pricing. We’re very competitive. We’re very consultative in nature. We want to help people. So Amer gold.com. Is our website.

george grombacher 21:23
Excellent. Well, if you enjoyed as much as I did, so Dana, your appreciation and share today share with a friend who also appreciates good ideas go to Amer gold.com. A mergold.com. And check out all the great resources in the info and then reach out info at amor gold.com. And find out if this is a good fit for you. Thanks. Good, Dana.

Unknown Speaker 21:46
Thank you, George. It’s been my pleasure. Thank you.

george grombacher 21:49
And until next time, remember, do your part by doing your best

Transcribed by https://otter.ai

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