Goldmoney etc.

[happyspec]

I would like to open a discussion about the reliability of Gold storage firms, especially Goldmoney. Craig wrote in his book that they wouldn't be a good solution because it is located in Jersey. Perhaps I didn't get the point what the additional risks in this case are in comparison - say - to a firm in Australia. As a German investor I would have to deal with the legal system in Australia. Would this be any easier than in Jersey?

[frommi]

I am german and i use bullionvault, physical Gold at DAB-Bank and an Gold-ETC from Deutsche Bank. You can`t avoid the risks with these firms, but you can diversify it. Bullionvault is located in London, which is nearer than Jersey or Australia in case of trouble. DAB-Bank is the most expensive option followed by bullionvault and then the ETC.

[happyspec]

I thought about combining physical holding (at a local bank), Proaurum (well-renowned metal dealer, storing in Germany) and Goldmoney for the purpose of having some outside the country. Each of these give me the opportunity of direct access to or delivery of the metal. By the way:Craug writes in his book - don't remember the exact table- that 20 of the 25% for gold should be kept "overseas". That seems a liitle bit too much in my point of view. Would appreciate comments on this topic...

[murphy_p_t]

does this mean you have 80% of portfolio in the German financial system / geography?

[frommi]

Switzerland is not overseas but currently out of reach of the german government. The gold at DAB-Bank is stored there and the gold of bullionvault either. Overseas for a US-citizen meant Switzerland as i remember correctly. The only other option currently is Singapur/Hongkong.
But is it really realistic to assume that if the US or any other government decides to track your gold, that you have a place anywhere on the world to hide?
So in the end if i would ever buy gold again i would only look at the cost. Gold is the most expensive asset to buy and hold, i really hate it for that .

[happyspec]

does this mean you have 80% of portfolio in the German financial system / geography?

yes it does. I thought about putting 12.5% of stocks (e.g. 50%) in europe and U.S. as well as half of the bond portion to U.S. In this case and with gold around 40 % of PP would be outside Germany itself. May I ask about the background of your question? Sounds like as if you wouldn't do that ...

[murphy_p_t]

my concern is that even having the full gold allocation (25% of PP) does not provide sufficient geographic diversification in the current climate. This statement is based on my biases / reading. Of course, the amount of geographic diversification chosen depends on many things, such as which country you reside in. Having said that, northern Europe is certainly more confidence-inspiring than southern Eurozone.

[greg9840]

I think GoldMoney is probably OK, but I have been hearing a lot lately about Singapore being the new Switzerland.  They should be more insulated from problems in the West.  A new precious metals exchange just opened in Singapore.  Jim Rogers is apparently endorsing them:
http://www.economist.com/blogs/schumpet ... ing-0 

The transaction fees are lower that GoldMoney, but the storage fee is higher.  GoldMoney starts at 0.12% per year and the Singapore Precious Metals Exchange is 0.5%.  But with the latter, the gold is allocated and in your name.  With GoldMoney, you own part of a gold pool, although registration is available where you would get allocated gold.  I am strongly considering moving at lease some of my gold to the new exchange in Singapore.