http://seekingalpha.com/news-article/12924...georgia-florida

If you refering paper gold to the Msian bank gold accounts, its a drop compared to that of the ETFs
The thing is if those paper holders starts to ask for physical delivery, you could see the ETFs come under
a lot of pressure when the price of gold goes up. Then those ETFs could certainly go belly up.....

as long as the music is still running, there is little difference.
the problem is you don;t know when the music will stop.
So U pandai2 predict lah and cash out soon lah.

Prior to default U will see
a) Long delivery time-frame.
b) increase spread in buying and selling.

the problem with default is
Scenario 1.
U still get back your $$ but never get your physical at all
1. Market stop trading cause default. Today price let said USD3000/oz. 31st Dec 2012.
2. Next day after market stop trading. physical price is 1 oz = USD3500/oz.
Following week it is USD4000/oz but the bank still pays U at USD3000/oz cause the trade stops on 31st Dec 2012.
Banks takes 2 weeks to process your payment.

Scenario 2.
1. Local bank invested in ETF.
2. Local bank can;t pay U if ETF don't pay the local bank.
Thus, I cannot pay U because someone else didn;t pay me. force majeure

the pamplet given to buyer only 2 -3 pages, does not contain most the legal stuff on what happen in case of default.
stop trading rule, payment rule in case of stop trading. thus a lot of things we don;t know. Do U invest in something U don;t know,


This post has been edited by GoldChan: Jun 20 2011, 09:15 AM

Very niice illustration

i wonder whats written in the gold account agreement in fine print about this scenario?
Can they suspend trading?

I 'm not sure whether it is suspend trading or etc.
the point is what is the use of the future market when U cannot take delivery.
No buyer or hedger will go for it. Only gambler will go for it. Hedge will go for it if equal cash settlement can be obtained from the exchange in order for hedge to buy the goods at open market.

Seller will not go for it as open market will definitely offer a better price in the event of going to default. or default.

happen b4 in London Nickel market.
TIN market also when mahathir brought lot of TIN at low price, cause of his british last policy, LOndon said those who shorted the market no need to deliver when the delivery was due.

Right!

When i fisrt invested in PBB gold account, they allowed physical delivery.
Then they stopped which leads me to believe that it stunk!

A very sad day for me. Maybe i need to let go 4 oz of my kijang to buy a piece of land...

Why sad? buying land is a good thing!

wanna sell to me?

I had bought kijang since 2008 and never sell a piece....

It had give me a tremendous appreciate value and give me some feeling that maybe someone who own gold can understand it.....

I will try to pujuk my wife to withdrawn her ASB to avoid me selling kijang...


Anyway, thanks for your offer, will consider it....

i bought since 2001 and never sold asingle ounce!

haha...YOU THE MAN......!!! I AM SO JELOSSS......!!!!

Banks do not need to default the gold account even gold price is USD10,000.
Paper gold account is very tiny in the bank portfolio deposit.

Unless the bank goes under, bank will not let the gold account or any single type of deposit service they had to be defaulted.

Banks do hedge their position, even without hedging (no bank will do it, it is plain silly, they won't be banker or deserved to be banker, if they are doing in naked position), they are able to absorb the loss in gold account as well.
Even ETF, or whatever hedging counterpart defaulted, banks may not default, and take the pain and absorb the loss, as it is the last resort/option.

Any single type of deposit assurance is the bank core pillar of survival.
Any default of deposit, means the bank can go out the financial business already, and may result the bank goes under because of it.
As banking system build on confidence, once lose, bank will not able to exist again.

This post has been edited by cherroy: Jun 20 2011, 02:46 PM

which klang shop that sell rm15,300 for 100g? are they selling pamp suisse goldbar?
anyway I did sold off one of my 100g PG for around rm15900 last month. market price would be around RM16700..if you still need 100g goldbar you can pm me, I still got stock in hand.
PG goldbar one of best goldbar in Malaysia, because if you need urgent cash, you can straight away sell them back to PG, the cash will be in your bank account within 24hrs. (its very rare to get an instant buyer for RM16K worth of Gold).
what we call them in English? in BM we call it kebolehcairan..

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Added on June 20, 2011, 4:48 pmwhy sad? a land also a peace of wealth/investment.
I have also sold few of my gold bar to buy a land in my hometown..more then 200g worth of gold being converted to piece of land and I am happy with it (bcoz I got the land at below market price).

This post has been edited by anakrantau: Jun 20 2011, 04:51 PM

You are right, both is an investment. It is more of personal feeling....

Anyway, the gold price seem unstoppable. Greece crisis is worsening and silver price had idle for quite sometime. Another bull maybe?

where is the land, can tell us arh! how much per sq ft?? agri land , residential or office land.
share2 a bit lah.
Just for us to know only mah. as I expect PM investor to buy land later on.

Just a small agri land, about 1.25 acre, at a corner of a jungle at Malacca. No money to buy land at Selangor or KL....

The price about RM30k and market price should be around RM45k and above. ( even though my friend said he can get buyer to buy at RM60k).

Plan to build a small house to raise our children. Stay at kampung, save a lot. Somemore can grow cili padi and use motorcycle without helmet.....hehehe......

Where is your land, how much? Wow.... goldchan now expanding his portfolio, congrat...!

No matter i buy physical or paper gold, the lowest spread value doesn't maintain as it is after years later.
Let say if i buy kijang emas today at rm4968, which is around 3.9% of the spread value.
How do we ensure that a year later, the different of selling and buying price still at 3.9%?
Because i remembered when i start buying paper gold from maybank last year, it was only rm4 difference between buying and selling price, but it is around rm6 today already.

you need the piece of land, else where are you going to hide your gold??

Land investment is high recommended if you can afford it and can get it at a good price...

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Added on June 21, 2011, 2:25 pmif you buy paper gold, the spread is dictated by the banks or institution. Else for physical gold, it is dictated by the market and you can sell it to any willing buyer at any agreed price between the two parties...

This post has been edited by jphlau: Jun 21 2011, 02:25 PM

30K must be a malay reserve land is it. Non-malay reserve land start at around 50K /acre.

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Added on June 21, 2011, 3:29 pmaiyah! buy physical and sell at ebay.com.my slightly lower than UOB or maybank rate.
In Klang Valley got buyer one. I manage to sell 2-3 pcs b4.

This post has been edited by GoldChan: Jun 21 2011, 03:29 PM

Yeah, planned to buy physical for long term, paper for medium term.
Do you know why the maybank site is showing 1oz of kijang emas is 31.105g? Because 1oz should be 28.35g.