Gold Coin Counterfeiting today

Discussion of the Gold portion of the Permanent Portfolio

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dualstow
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Re: Gold Coin Counterfeiting today

Post by dualstow » Tue Jan 10, 2017 12:52 pm

I'm not worried about future gold purchases because I'll have a testing tool ready, but I shudder to think the random year krugs I already have at the bank could be fake. Hope not. :-\
RIP Marcello Gandini
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Re: Gold Coin Counterfeiting today

Post by PP67 » Tue Jan 10, 2017 12:58 pm

dualstow, can you print the WSJ article to a pdf file and then post the pdf here?
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I Shrugged
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Re: Gold Coin Counterfeiting today

Post by I Shrugged » Tue Jan 10, 2017 3:11 pm

This could have the effect of depressing demand for gold coins. Or so I would think.
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Re: Gold Coin Counterfeiting today

Post by drumminj » Tue Jan 10, 2017 5:47 pm

I Shrugged wrote:This could have the effect of depressing demand for gold coins. Or so I would think.
So now we should buy paper gold instead of physical??? :o
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Re: Gold Coin Counterfeiting today

Post by I Shrugged » Tue Jan 10, 2017 6:48 pm

No, but if gold coins become disreputable, something's gotta give.
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Re: Gold Coin Counterfeiting today

Post by ochotona » Wed Jan 11, 2017 5:25 am

The market is not dead yet. The 99.99% coins can't be counterfeited due to the density of gold. The lower gold content of Eagles and Krugerrands makes them vulnerable.
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Re: Gold Coin Counterfeiting today

Post by Libertarian666 » Thu Jan 12, 2017 12:32 pm

ochotona wrote:The market is not dead yet. The 99.99% coins can't be counterfeited due to the density of gold. The lower gold content of Eagles and Krugerrands makes them vulnerable.
Tungsten is almost identical in density to gold, so even 24k coins might be a problem.

But the ring test will still distinguish fake from real coins.
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Re: Gold Coin Counterfeiting today

Post by Steve Brule » Thu Jan 12, 2017 6:50 pm

dualstow wrote:I'm not worried about future gold purchases because I'll have a testing tool ready, but I shudder to think the random year krugs I already have at the bank could be fake. Hope not. :-\
If you are really concerned, there are more and more gold dealers that have x-ray frequency machines that can determine the content of your krugerrands. In my experience, the dealers with these machines have been happy to let me test my coins with them.
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Re: Gold Coin Counterfeiting today

Post by dualstow » Thu Jan 12, 2017 8:09 pm

Interesting. I haven't seen the x-ray tests, but that would get right to the point, wouldn't it? I'll have to see if I can find one locally.
I think I'll try the iphone app, and if necessary, the Fisch ringer (89 bucks) in the future.
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Re: Gold Coin Counterfeiting today

Post by ochotona » Thu Jan 12, 2017 10:36 pm

Gosh, would that be x-ray diffraction (XRD) analysis? I used to do that in college with minerals. That's a serious solution to the security problem.

I have Maple Leaf coins with the micro-engraving on the leaf side, it's really intricate and not possible to see in full detail without magnification. You'd think this would be impossible to forge well.
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Re: Gold Coin Counterfeiting today

Post by dualstow » Fri Jan 13, 2017 8:14 am

I bought my first maple this winter, a 2017 with that microengraving. Pretty cool. I'd buy more if they weren't so soft (pure). Price of being pretty.
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Re: Gold Coin Counterfeiting today

Post by Cortopassi » Fri Jan 13, 2017 8:34 am

I understand there is a potential for concern here, but it sounds a bit overblown. I buy from a guy who's been in business for 35+ years. I'm not too worried.

If a fake was good enough to pass by him to me, well, then it's probably good enough for me to pass on if there comes a time to sell! I will hopefully never know.
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Re: Gold Coin Counterfeiting today

Post by sophie » Fri Jan 13, 2017 8:35 am

I'd heard maples were beautiful. I'd be worried about how they'd hold up during long term storage by a cretin like me, though.

I think I'm done buying physical gold, and this thread has helped with that decision - I just don't need to be worrying about counterfeiting, let alone storage & insurance issues. The rest of my taxable gold purchases will be Perth Mint certificates.

BTW Fidelity's bullion program is really worth a look for tax-advantaged accounts. They've reduced the storage fees. There are ~2% commissions to buy & sell, and storage (i.e. expense ratio) is 0.5/yr. Storage is in Nova Scotia and insured by Lloyd's of London. It's limited to IRAs, can't do it in a Keogh, but it's a really nice alternative to ETFs. I am thinking to take the plunge for the gold held in my Roth.
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Re: Gold Coin Counterfeiting today

Post by dualstow » Fri Jan 13, 2017 2:16 pm

sophie wrote:..
I think I'm done buying physical gold, and this thread has helped with that decision - I just don't need to be worrying about counterfeiting, let alone storage & insurance issues. The rest of my taxable gold purchases will be Perth Mint certificates.
...
Physical gold is fun, though. I don't think I'll buy insurance until it's time to transport it all somewhere. (Yeah, they probably don't cover that).
You've got me interested in the mint certs now.

Image
Last edited by dualstow on Fri Jan 13, 2017 2:20 pm, edited 1 time in total.
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Re: Gold Coin Counterfeiting today

Post by Steve Brule » Fri Jan 13, 2017 8:16 pm

ochotona wrote:Gosh, would that be x-ray diffraction (XRD) analysis? I used to do that in college with minerals. That's a serious solution to the security problem.

I have Maple Leaf coins with the micro-engraving on the leaf side, it's really intricate and not possible to see in full detail without magnification. You'd think this would be impossible to forge well.
I want to say that it is, but I am not really sure. The machine looks sort of like a hand-held scanner from a grocery store that you press up against the gold then squeeze the trigger. Does that sound similar?

My solution to counterfeits has been to buy the newer maples leaves with the light refracting lines on them. My reasoning is that many counterfeits half rough surfaces that I think would make replicating said lines very difficult, if not impossible.
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Re: Gold Coin Counterfeiting today

Post by Mark Leavy » Fri Jan 13, 2017 9:31 pm

If the coin is the right size and weight, and you are still unsure, then just test the sound. There is no known way to make a counterfeit coin that will be even close to passing all three tests (size, weight, tone) at the same time.

To test for sound:
Balance one coin flat on a fingertip and then tap it gently with the edge of another coin.

A gold coin will give you a beautiful, sustained ring with rich third order harmonics. It reaches into your soul it is so melodic.

Tungsten or any false core will give you a "thud". If the tone doesn't make you weep - it's counterfeit.
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Re: Gold Coin Counterfeiting today

Post by thisisallen » Sat Jan 14, 2017 3:35 am

@Sophie. Why are Perth Mint certificates better for tax accounts, but Fidelity is better for tax-advantaged accounts?
Thx.
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Re: Gold Coin Counterfeiting today

Post by ochotona » Sat Jan 14, 2017 7:52 am

Mark Leavy wrote:If the coin is the right size and weight, and you are still unsure, then just test the sound. There is no known way to make a counterfeit coin that will be even close to passing all three tests (size, weight, tone) at the same time.

To test for sound:
Balance one coin flat on a fingertip and then tap it gently with the edge of another coin.

A gold coin will give you a beautiful, sustained ring with rich third order harmonics. It reaches into your soul it is so melodic.

Tungsten or any false core will give you a "thud". If the tone doesn't make you weep - it's counterfeit.
Thanks for that! My Australian Mint Kangaroos had a beautiful ring, also the Krugerrands, the Canadian Maple Leafs, because they are thick and smaller diameter didn't ring as much, and it was very high-pitched, but still they rang.
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Re: Gold Coin Counterfeiting today

Post by sophie » Sat Jan 14, 2017 9:08 am

thisisallen wrote:@Sophie. Why are Perth Mint certificates better for tax accounts, but Fidelity is better for tax-advantaged accounts?
Thx.
Well, you can do whatever you want with taxable money. I like the safety of dealing with the Perth Mint, plus the fact that Bron Sucheki, an employee of the Perth Mint, is a member of this forum and has provided useful answers to questions. It is annoying that the certificate account falls under FATCA rules. Something like Hard Assets Alliance is more convenient, but the short history (opened in 2012) makes me hesitate.

For tax-advantaged accounts, life gets harder. The main two options have been gold ETFs or a gold IRA with a specialized custodian. I'm getting increasingly nervous about gold ETFs especially if the gold price sinks further, and would like to avoid them. Gold IRAs are a PITA to set up and also super expensive. The fact that Fidelity now offers bullion storage in IRAs for prices that are competitive with gold ETFs is an awfully attractive alternative. It's unallocated storage but I think far safer than an ETF.
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Re: Gold Coin Counterfeiting today

Post by thisisallen » Sat Jan 14, 2017 10:26 am

Have you considered Bullion Vault? Some friends (non PP investors) have been using it for years and recommend it as a good company. And it seems to be discussed and liked in the forum.
There was a thread about it:
http://www.gyroscopicinvesting.com/foru ... php?t=8487

Don't laugh but I never heard of FACTA, and I have been living in India a lot and have bank accounts. I do know about the FBAR form that needs to be sent in by 30 June each year but that is not the IRS, it is the Treasury Department. It is required when a person has accounts over $10,000 in a foreign investment. Of course, if a person has earned interest on a foreign investment then the person needs to declare that on his income tax form.
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Re: Gold Coin Counterfeiting today

Post by Libertarian666 » Sat Jan 14, 2017 10:40 am

sophie wrote:I'd heard maples were beautiful. I'd be worried about how they'd hold up during long term storage by a cretin like me, though.

I think I'm done buying physical gold, and this thread has helped with that decision - I just don't need to be worrying about counterfeiting, let alone storage & insurance issues. The rest of my taxable gold purchases will be Perth Mint certificates.

BTW Fidelity's bullion program is really worth a look for tax-advantaged accounts. They've reduced the storage fees. There are ~2% commissions to buy & sell, and storage (i.e. expense ratio) is 0.5/yr. Storage is in Nova Scotia and insured by Lloyd's of London. It's limited to IRAs, can't do it in a Keogh, but it's a really nice alternative to ETFs. I am thinking to take the plunge for the gold held in my Roth.
I think it may be possible to use a foreign institution for physical gold in a tax-advantaged account, if that account is a corporate profit sharing plan. If there were enough money involved to make that feasible, I would take a look at that if I were in your situation.
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Re: Gold Coin Counterfeiting today

Post by Libertarian666 » Sat Jan 14, 2017 10:42 am

thisisallen wrote:Have you considered Bullion Vault? Some friends (non PP investors) have been using it for years and recommend it as a good company. And it seems to be discussed and liked in the forum.
There was a thread about it:
http://www.gyroscopicinvesting.com/foru ... php?t=8487

Don't laugh but I never heard of FACTA, and I have been living in India a lot and have bank accounts. I do know about the FBAR form that needs to be sent in by 30 June each year but that is not the IRS, it is the Treasury Department. It is required when a person has accounts over $10,000 in a foreign investment. Of course, if a person has earned interest on a foreign investment then the person needs to declare that on his income tax form.
I assume you are a US "person". If this is correct, you will probably be hearing about FATCA from whichever banks you deal with, once they get harassed by the US Treasury. Be prepared for a lot of pain if you haven't been following the incredibly annoying and intrusive rules.
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Re: Gold Coin Counterfeiting today

Post by thisisallen » Sun Jan 15, 2017 9:49 pm

After looking up FACTA, the minimum account that requires reporting is $50k. I haven't kept that much in an account at any 1 time since it is easy to transfer from US and there is currency exchange risk (especially now when $ is strong).
Good to know about FACTA for future decisions.
Thx.
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Re: Gold Coin Counterfeiting today

Post by Libertarian666 » Mon Jan 16, 2017 8:45 am

thisisallen wrote:After looking up FACTA, the minimum account that requires reporting is $50k. I haven't kept that much in an account at any 1 time since it is easy to transfer from US and there is currency exchange risk (especially now when $ is strong).
Good to know about FACTA for future decisions.
Thx.
It's FATCA, and the minimum account size used to be $10k, so that's an improvement.
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Re: Gold Coin Counterfeiting today

Post by dualstow » Mon Jan 16, 2017 10:02 am

@ocho: how did you test the maple without scratching it? One of the apps I found calls for spinning the coins on a hard surface.

This along with Leavy's description has led me to expect nothing less than the elven singing that Tolkien says created the universe.

light refracting lines: the new Britannias also have a kind of sun ray background design. Don't know if they're light refracting, but they're supposed to be a good anti-counterfeiting measure.
RIP Marcello Gandini
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