Buying Gold - Gold Coin (eGC)
Buying Gold and convert to electronic Gold certificate securely written in the SGC card

Why Buy Gold ?

The case for buying gold

It is easy to understand why gold is so precious. It has been this way from the beginning of time. From the dawn of civilization and organized life people recognized gold metal as something of a unique value. Interestingly enough the same happened with different civilizations. Split apart by vast distances and oceans they still came up with same conclusion and accepted gold metal as an extraordinary value. Pure gold withstood the test of time with flying colors and kept increasing value ever since. It is the only value which cannot be defaulted by the mistakes of others.

Opposite to gold is paper money that could and often does lose all value literally overnight at the stroke of a pen. Unlike pure metal gold which literally lasts forever. It cannot diminish, lose properties or deteriorate in any way. That is an amazing property itself! Gold as a basic metal is the same everywhere in the world. In a few words gold is forever and nothing can change that!

WHO IS BUYING GOLD ?

All gold miners in the world bring up about 2800 tonnes of gold in one year.

  • About 50% of the world production of gold is used to make jewelry. Notably India and China are two countries with the largest consumption of gold used by goldsmiths to make jewelry.
  • About 30% of the production is acquired by investors to be held or traded as an investment vehicle or simply held forever as gold is guaranteed to increase value over time.
  • About 10% of the world production is purchased by central banks to prop their financial systems.
  • The last 10% is used in industry, medicine and overall technology. Gold is an electrical super conductor.


PAPER MONEY

Also referred to as a fiat money. The value of it is determined by Governments issuing it. The value of paper money fluctuates from very valuable to a value so small that it is actually less than the value of the paper money it is printed on. When people lose confidence in money they do not want to accept it as a means of payment and often its only use is as kindling. This is where precious metals come in as a complete replacement for paper money. More about that later...

!

GOLD IN TROUBLE

NOTABLE BREAKING POINTS

In the last 100 years there were a few events where manipulations involving gold created long lasting effects.

> Executive Order 6102 is a United States presidential executive order signed on April 5, 1933, by President Franklin D. Roosevelt "forbidding the Hoarding of gold coin, gold bullion … ” effectively criminalize possession of gold in private hands. That was single largest, state sponsored robbery of gold in history. People who handed over their gold possessions where given fiat money in value of $20.67 per troy ounce! That comes out to about $0.66 per gram of gold. Today the same gold would fetch U$42.00 a gram. But the story doesn’t end there. After the Government scooped up all the gold they could, they set a new price of gold at $35.00 an ounce! That is a 40% increase over the price just few weeks ago.

> August 15. 1971. President Nixon’s executive order disconnected US dollar from the gold standard. By that colossal mistake the Federal bank could create as much money as they see fit since they were not bound any more to support money supply with gold reserves.

> 2008 US (again USA) financial crisis was “solved” by engaging the Federal bank money presses that have not stopped to this day. If history is teaching us anything the fact is that uncontrolled money printing is a sure way to hyperinflation. And everybody knows what hyperinflation is. Due to an increased supply of paper money it dramatically loses it's value. Overnight or within hours merchants start changing price tags with increases that never stops.

> Other countries took note of these catastrophic decisions and made a 180 degree turnaround. Their answer is: buy as much gold as possible! Their central banks are actively buying gold on the world’s markets. If financial catastrophe strikes and the USD loses its reserve currency status these countries are left with a healthy possibility to backup their currencies by gold standard. Who are those countries?

Namely China and Russia. China is encouraging its own population to hoard gold. They do not allow selling it or transporting abroad. Why?

At any given moment possession of large gold reserves will make all the difference in the world. Every country with significant gold reserves will be involved in decision making process. Their currencies will become very valuable and those countries will dictate and re-shape the financial world. In turn countries that have their gold reserves depleted will have no say and will have to accept fallout of whatever will be. Example of countries with no national gold: Canada.

So what happens when country leaders think for themselves and recognize gold as an ultimate value? Remember Muammar El Gaddafi, leader of Libya? He wasn’t exactly a model citizen but he saw many things very clearly. He wanted the best for Libya and Africa and promoted the trade of Euros and gold. He is deceased now. The USA and others didn’t like his free thinking “destructive” ideas.

WHEN IN DOUBT - BUY GOLD!

PLAIN AND SIMPLE – BUY GOLD

There is no better monetary value than gold. Pure gold is gold, only one grade, one price. It is the same in Japan or in Chile. It is a dense metal where small pieces are quite heavy and valuable. It is easy to test its purity. It does not corrode or go bad in any way. It is accepted as value anywhere on Earth. Supply is relatively small and actually diminishing since it has been explored for thousands of years. It will never suffer devaluation due to excessive supply. All the gold ever produced can fit into 20 m cube!

By storing physical gold a person preserves and increases their wealth for now and the future. Wars, financial crises, unrests prop the value of gold sky high. The message is unmistakable: buy gold!

DO NOT BUY

Do not mistake stocks of gold producing companies for physical gold! Gold mining companies do well and will become even more valuable in moments of crises. Unfortunately same companies are subject to economical movements, have payroll, equipment, accounting, Government, stock market and many things to worry about. They can lose concessions to land, mines and experience hardships that reduces stock value.

Even worse are ETFs and indexes that have no real value whatsoever in them. They represent financial world inventions how to suck up money from the general public. Values are based on the stock market and can vary widely. The investor can lose everything.

Special DO NOT BUY EVER we would attach to gold paper certificates issued by the banks. It is typical Wall Street invention created to suck up money from investors! Same physical gold or no gold at all is sold to hundreds or thousands of investors as a "sure thing". Only one of hundreds or maybe no one would get actual gold if asked for it. They call it "monetary instrument". Never buy this, ever.


WHEN TROUBLE STRIKES!

Recommended solution is to buy physical gold. It does however represent a logistical problem. Gold holdings have to be securely stored and protected from theft. In moments of financial crisis gold value will skyrocket. The holder will be able to ride the storm by buying living essentials or even capital objects using stored gold. On the flip side he will also be a target if someone suspects that there is a gold on premises.

The fact is food, energy, gas will be very expensive during hyperinflation. One will need buckets of paper money to buy even the smallest essentials. On the other hand normally expensive items like phones, cars, furniture, real estate will cost much less since nobody will be able to afford it.

The dilemma between buying food and life essentials or an iPhone is very easy to solve. Food wins every time!

GOLD vs. BITCOIN

Digital currency or is it like that?
Is there even comparison?

Let's be clear about something from the start: Bitcoin is a speculative play! Digital image of value. That is all what it is, nothing more. Some people call it asset and we can accept that but cautiously.

For starters biggest difference between GOLD COIN and Bitcoin is that BTC does NOT have any intrinsic value! It is a small digital file comprising of few tens bytes of data. That is all there is! Paper money is value because Government says it is and it is a legal tender accepted as such. Bitcoin is hardly recognized by Governments thus it is not regulated and accepted as universal value for monetary transactions.

So how come that Bitcoin is so expensive and perceived as value or investment? In reality person can't really buy anything with Bitcoin so only reason why people buy it is because they believe somebody else will want to buy it off tomorrow or in some amount of time. Goal is to sell it for more than purchase price was and make a lot of (paper) money with it.

Holding BTC and never selling it does not make much sense. Problem is that nobody knows how much will BTC worth next week, next month or in 10 years. We won't even go for tens of years. BTC is digital file. In days or weeks there may be another digital currency out there. How about Altcoin, Litecoin, Etherium ... who can possibly keep count? At this time there are about 40 different digital currencies. Each new digital currency sounds promising to be next "big thing" and yet again people flock to them.

Also Bitcoin may be it's own enemy. It became relatively easy to setup and launch yet another "new" digital currency. Speculators run to those "opportunities" like bees on honey ... until there is new one just being released.

Similarly to Ponzi scheme only early creators and adopters really earn something. But they don't earn it by holding for a long time. Quite opposite they sell rather quickly into the stream of incoming "investors". Funny part is that Bitcoin hoarders are quite happy to get fiat money they are bashing every day and at every opportunity!

Bitcoin is very volatile. Skyrocketing and dropping as a rock. Few weeks ago 1 BTC was 2950 dollars, in few days $2700, week after that $2320. At the time of this writing BTC is $2020. So volatility is a theme of the day for Bitcoin. That makes it undesirable as method of payment for any transaction and puts merchant into speculation mode. No merchant wants to be there, gambling with digital file that worths 250 dollars today or 310 dollars or may actually worth nothing next week.

Supposedly BTC transactions cost are fast and cost next to nothing. That would be truth if both sides of transaction want BTC as a final result. But that is never the case. Usually recipient will want to exchange BTC to let's say dollars or Euros. Here things become complicated. Recipient has to have account with Bitcoin exchange and put it up for sale. BTC is sold there, sometimes fast but more often slow. There is already loss. Next one is when recipient wants his money transferred to his bank account so he can spend it. That costs money as well. Another fee to pay. Cumbersome process to do. From the moment seller sends Bitcoin to the moment buyer gets it, exchanges it for paper money, gets it in his account or card maybe days after. That is hardly quick and loss free transaction.

Starting up own wallet take few minutes to accomplish. One is ready to participate in digital currency world quite easily. Opening brokerage exchange account is quite different story. Selecting proper exchange is risky proposition in it's own right. Opening actual account is right out nightmare. One has to be ready to provide a lot of personal information and proofs in order to have account setup. Without it you can't get regular currency.  Anonymity is thrown out of the window in that process.

Actually, as people who are into software and encryption we value blockchain as most valuable part of the Bitcoin system. Incidentally that is not part that really stands out or brings up value in BTC. It is definitively software marvel but lives in background. They say that it is non centralized system meaning that anybody and everybody can see it and control it. That is great, power to the people, but whom do you call when there is a problem? Remember Mt. Gox the biggest BTC exchange that was brought down by hackers? Bitcoin holder's money disappeared without trace and nothing happened to anybody. They quietly closed the door and that was that.

CONCLUSION

Gold  (precious metal) is a chemical element of atomic value 79. It has intrinsic value in every little bit. It not only holds it but rather increases in value throughout thousands of years. It is very scarce with world production dropping since most of the available gold is already mined. It can't be physically destroyed. We will not describe all properties of gold but it has self evident tangible properties.

In our view there is no even comparison with Bitcoin or any other digital currency! It's like having a bottle of water in one hand and digital file representing a value of bottle of water in other hand. What would you rather have? Exactly!

Gold was present long before and will be present for very, very long after every paper currency turns into dust, or in case of digital currency into literally nothing. Gold simply can not disappear. 

Maybe you are toying with idea of investing into gold ETFs, derivatives or other "great" Wall Street inventions. They will gladly sell you "right to gold" but conveniently forget to tell you that same paper is issued to another 100 investors. Bitcoin is even worse. It's based on literally nothing! 

OUR PREDICTIONS  - it's up to you to believe it or not!

We strongly believe that only digital currency that will have universally accepted value will be one backed up by gold! Furthermore we believe it is not a fiction but rather Russian and Chinese Governments are likely to be first ones with such system.

Please understand the following: in case of true government sponsored and issued digital currency that is exchangeable for physical gold ALL other digital currencies will become worthless literally overnight! Nobody will want them any more. Will you?

Of course not. Gold will not be affected with such system. It will rather increase in value. In this happens demand for gold will skyrocket.

IN SHORT

Forget Bitcoin as a stored value. Smoke and mirrors, that is what it is. When we read that professional money managers "invested" millions of people's pensions and funds into Bitcoin we simply can't believe it!? They are taking a huge risk with other people's savings. It's crime. Gold is many times more valuable than any digital currency consisting of few bytes of data. It is value forever. It can't diminish, disappear or go bad. It can't be brought down by click of the mouse, any government action, virus, malware, PC failure, disruption in Internet, ransom-ware, solar flares, no electricity or anything like that. Read more about Bitcoins on our blog page

Only drawback with gold is that you have to securely store it somewhere to prevent it to be stolen. That is what we do for you dear SmartGold Club Member. We take away that burden, organize everything for your benefit and convenience. We put your gold into safe location of your choice. Regardless if it is a bank gold certificate or part of the privately owned secure vault. It is there, accounted for, insured, audited, safe, protected, allocated to card holder, segregated from other piles of shiny metals. It is very happy place!