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Follow on Google News | Owning Real Gold Has Advantages Over Paper Gold, Dillon Gage Says“Handling and storage of precious metals are relatively minor inconveniences compared with the security and control that direct ownership offers,” Hanlon concludes.
By: Dillon Gage Metals 
dgm logo In an emergency, gold metal can be sold for cash. Refugees fleeing wars have carried small gold bars across borders. And if they desperately need money, women – in Asia, the Middle East and Africa in particular – might sell a gold bracelet. Buying physical gold generally means purchasing bullion or coins and then taking delivery and storing it, says Terry Hanlon, president of Dillon Gage Metals. “For investors buying large quantities, they can store bars and coins in a secure metals depository – which should be chosen carefully,” he adds. In recent years, national central banks have been buyers of physical gold, Hanlon notes. In 2011, central banks were net buyers, and their purchases surged more than fivefold to 440 tons from 77 tons in 2010, according to the World Gold Council. The Federal Reserve is, in fact, the largest owner of gold in the world. Holders of paper gold, meanwhile, are interested in price movements or diversifying their investment portfolios, Hanlon reports. Paper gold includes Exchange Traded Funds, or ETFs, and gold futures and options. Those who buy gold mining stocks are investing in a company. So, the performance of the stock is not necessarily tied to the performance of gold, but rather that of the company itself. The creation of gold ETFs, starting in 2004, offered investors another way to purchase the metal and helped investment demand for gold to grow steadily in recent years. At least a few analysts worry that gold might at some point be subject to a “squeeze” as the metal gravitates to investors who have little intention of lending or selling it, Hanlon says. Central banks might refrain from providing liquidity. As physical gold gravitates to central banks and strong hands or big investors, above-ground gold inventories could decline and there would not be enough available to meet demand. In the 1970s, the Hunt Brothers – William Herbert and Nelson Bunker of Texas – accumulated large amounts of silver and had nearly cornered the market when prices rallied to a record $50 an ounce in January 1980. Two months later, silver prices collapsed, however. “Today, major metals exchanges around the globe are vigilant about protecting the stability of markets,” Hanlon explains. “But a squeeze on gold could happen nonetheless.” “Handling and storage of precious metals are relatively minor inconveniences compared with the security and control that direct ownership offers,” Hanlon concludes. “Paper forms of ownership are promises to pay, based on faith in and the credit of the issuer. Holding physical metal allows the owner to sell a portion of it anytime and almost anywhere in the world and to receive hard currency in return.” About Dillon Gage Metals Dillon Gage Metals is one of the largest and most diversified precious metals dealers in the world, offering bullion trading, online trading of physical metals, rare coins and estate liquidations, jewelry and diamond close-outs, refining services, and depository storage and fulfillment facilities. A division of Dillon Gage Incorporated of Dallas, which was founded in 1979, the operating units of Dillon Gage Metals include: • Dillon Gage Bullion Trading, one of the largest bullion dealers worldwide, also offering rare coins and estate liquidation. (DillonGage.com/ • Dillon Gage Refinery, a state-of-the- • FizTrade Online Trading offers real-time trading for bid and ask markets for physical gold, silver, platinum and palladium. (www.FizTrade.com) • Diamond State Depository LLC, a wholly owned, independently operated precious metals storage and fulfillment facility located near Wilmington, Delaware. (DiamondStateDepository.com) • International Depository Services of Canada Inc., a wholly owned, independently operated precious metals storage and fulfillment facility located near Toronto, Canada. (IDSofCanada.com) For more information on Dillon Gage Metals, please visit DillonGage.com/ Contact: Jo Trizila TrizCom Inc. jo@TrizCom.com Office: 972-247-1369 Cell: 214-232-0078 # # # About Dillon Gage Metals Dillon Gage Metals is one of the largest and most diversified precious metals dealers in the world, offering bullion trading, online trading of physical metals, rare coins and estate liquidations, jewelry and diamond close-outs, refining services, and depository storage and fulfillment facilities. Contact: Jo Trizila TrizCom Inc. jo@TrizCom.com Office: 972-247-1369 Cell: 214-232-0078 End
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