counterfeits on the rise...

Good morning and welcome to another Top-Shelf Thursday! Pure Prairie League greets me this morning with their 1972 hit, “Amie.”

So yesterday I watched the New York Spot Prices rebound again. This time, gold closed up $6.00 settling in at $1,280.80, Silver was up $0.08 to $16.99, and Platinum closed up $10.00 at $930. In early morning trading gold has picked up an additional $5.60, silver is up $0.08, and platinum is up $6.00. Well, let’s see what happens today in the markets.

In other news, the Dow closed up yesterday 6.13 to 23,563.36, and the dollar was mixed with Aussie Dollar, Canadian Dollar, Euro, British Pound, Swiss Franc, and Japanese Yen all closing down to the USD. So, basically, the dollar reigned among the “Western Currencies.”

If you’ve been a regular reader of mine, you know I believe in a balanced portfolio. Of course, because I’ve been in the coin and currency business as a collector and then dealer, this balance includes precious metals. If you too, either currently own or plan to purchase gold and silver, I have some recommendations that I hope you consider.

In my blog on October 31st, I shared with you that Canadian authorities had found a Royal Bank of Canada (RBC) counterfeit gold bar. This bar was correctly marked and packaged and had passed inspection even within the RBC. As a dealer, I know I wouldn’t have questioned its authenticity, so I’m guessing you wouldn’t either. Further, when a coin is encapsulated in an authentic looking package, every dealer I’ve worked with has purchased it without actually testing the metal.

Obviously, to perform a “good” test, you must test below the surface and that means that the packaging is opened and the coin or bar is defaced. Something dealers understandably just won’t do. I have had the opportunity to use X-Ray Fluorescence analyzers and they are accurate; however, even this technology can only “see” a few microns deep into the item, so a coin or bar coated with precious metal can easily dupe even our best testing. To try to get an idea of how widespread this issue is, all you have to do is a search on the internet and you realize that it has exploded. And it’s not going away, because most authorities haven’t a clue. Recently, U.S. Border Agents were asked about the gold U.S. one ounce American Eagle that has a face value of $50. Four out of five agents believed that the coin’s value was $50 instead of $1,300! So, although I’m sure we have sophisticated counterfeiters within our United States borders, we know 90+% of what has been already identified is coming from other countries.

This past January, an anti-counterfeiting taskforce that is a part of the Industry Council for Tangible Assets (ICTA) was created as a private industry (non-government) watchdog. Since then, their work with the U.S. Customs and Border Protection has shown an increase in confiscation of counterfeit gold and silver. But there is literally tons of precious metal coins and bars already here in the U.S. market waiting for you to step up to the counter.

Of course no dealer or marketplace (Amazon, eBay, Alibaba to name a few) can afford counterfeit coins and bars. Not only are they illegal but they cost us our reputation, so we do everything we can to stop them when we see them. But if you can’t tell, then they are bought and resold with everyone none-the-wiser.

So what do you do? You want to add 15% of your portfolio in precious metals. I recommend you consider coins that are easily recognized. What better way to invest in silver than to buy (pre-1965) silver dollars, halves, quarters and dimes or silver American Eagles and Canadian Maple Leafs. I suggest the same considerations be made when purchasing gold. Purchase easily identified products such as early U.S. gold coins, modern gold American Eagles, and Canadian Maple Leafs. And buy them from the Mint or a reputable dealer. All of these items are monetized and therefore fall under stricter U.S. Treasury/RBC counterfeit laws than bars or rounds.

Well, I’ll let that be it for today. Go out there and make a difference! See ya’ll later!

*Disclaimer: Precious Metal Musings™ is written for entertainment and news purposes only and should not be used in making purchases and/or sales of precious metals.