Gold gram bars a ripoff ?

Looks that way to me , at like a good 20% over spot in vending machines !

 

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Of course they carry a high premium for such a gimmick, but the smaller/smallest bars and coins always carry a huge mark up.


Gold on ATMs... [1/2/2011]

Fancy ATM skips the folding cash, spits out gold [12/17/2010]

Gold Vending Machines Coming America [09/2010]

Gold ATM [05/2010]
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I just don't see buying gold from a vending machine in the first place.

 

In this case you really shouldn't. It is a gimmick and panders to those with money to blow who are prone to such novelty playing off the media attention precious metals have gained in recent years.

However, we once bought stamps (denominated currency) from vending machines. Train and subway tickets are still acquired in this manner. Vending machines are useful and account for much of the use of coinage in our financial culture and daily transactions.

Vending machines are a world wide tool of sales and convenience. There are reportedly some 23 vending machines for every one person in Japan. While the US is not as saturated being more spread out, they are everywhere and offer us newspapers, food, drink, luggage carts at airports, locker rental, toiletries in hotels... by extension, it's not so far-fetched in a culture turning to the prospects and security of gold to have precious metals vending machines. The important thing to realize is that these vending are capitalizing off precious metals hysteria and perhaps some ignorance of its above spot price value. Were there to be reasonably priced bullion or collectibles in vending machines at your local banking institution I don't think you and others would be so quick to judge the idea of gold atms and vending machines.

 

Call me a conspiacy theorist, but who's to say what the purity is in vending machine gold? I'd really like to look the guy in the eye and maybe ask a question or two if I'm buying gold. By the way, 20% is probably not a bad markup on such a small amount of gold in my opinion. If you want less, buty a larger quantity.

 

I don't know why you would link conspiracy theorist with purity of gold in these vending machines... but it the gold was found out not to be of the purity marked on the bars and coins they dispense and with the certificates of authenticity that come with each purchase, the gimmicky ATM vending machines wouldn't last very long. If you check out the links I posted above you can see an example of the .999 fine 10 gram Heraeus bar that was being sold from the Abu Dhabi vending machine. I believe the kind of coins and bars sold in these machines may be adjusted for the market they are placed in, so in the US, you may find AGE coins, J&M, Sunshine Minting Inc. bars and the sort that would appeal most to the populace. Being in North America, there may also be Maples or other private mint bars. If you don't trust those then how can you trust them from a person-to-person transaction either?

 

Saw this issue on T.V a few weeks back doesnt make much sense buying Gold from a
Vending machine! and what about personal safety! the bad guys probably stake these
Out and the people that buy this way are just saying rob me i,ve got Gold!

 

A lot of people buy the 1 gram bars to make into jewelry. Some can't afford to buy ounces, but they can buy a gram or two every month. They do eventually add up to ounces and they also make nice gifts. Hey, it all stacks.

 

Most of the questions appearing in this thread were all already covered in the threads linked to in post #2.

The vending machine in Abu Dhabi was located in the seriously upscale, seven-star Emirate Palace Hotel. Check out the virtual tour.

Security was not an issue. Bad guys held at a distance in a kingdom where punishment for such theft is probably a bit more harsh than it is in other countries.

Placement of these vending machines are not in the 7-11 or Circle-K prone to hold-ups.

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Indeed it does add up, however the 20% or whatever the premium on small weight bars may be over spot really adds up fast too. It is much better to save one's money until they can invest in a full ounce of gold especially if it's for investment purposes. I doubt the jewelry makers are going to be buying from vending machines. They tend to buy scrap or anything with low premiums and inturn mark up their products significantly, which includes their time and skills, not just the value of the metals. With gold @ $1,375/oz. having 31 one ounce gram bars to achieve that ounce but paid for with 20% on top adds another $275 to the cost of your ounce of gold, or $1,650/oz. Yikes! Think of that $275 as 1/5th, and when you have five you have an ounce more gold if you had saved up your money and bought more responsibly priced gold... that stacks up.

 

It goes back to being able to trusting your dealer. I buy from a local dealer whom I'd trust my life with. He deals in stamps and coins. He doesn't sell antiques, used hand tools, and baby clothes on ebay. He is an expert with over thirty years in the business. I can't say that about a fly-by-night coin dealer from out of state at a coin show.

 

Your comment then was very basic, just to say that you only buy gold from your local dealer with whom you have experience and trust with. You are suspicious of machines dispensing precious metals because you in fact defer some degree of knowledge in the transaction (buying PMs ) to your dealer whereas the impersonal nature of the vending machine disconcerts your rationality and trust in your own knowledge of buying PMs in the transaction.

A machine is infinitely more rational than a human and humans are infinitely more likely to be the cause of mechanical issues involving the machine, the ones setting the prices at which the machines dispense product and themselves prone to error and emotion. Humans are especially prone to emotion when it comes to money and investing. Their ability not to be emotional is often heightened when it involves the desire for physical precious metals. We stop at red lights and obey traffic signals without thinking, even when rationally no risk exists and we could proceed before the green light tells us to do so, rationally. We don't see people demanding all intersections be staffed by authorities to waive us through safely because people distrust a mechanical system in place. Do you buy cans of soda in vending machines too or only from the cheapest retailer you can find them from? Some of that mark up covers the costs of operation, security, maintenance, location rental and the convenience of bringing the product to you in this fashion, none of which is a conspiracy but rather the cost of doing business.

The important thing to consider is what is the machine selling and how much is it selling for. If you understand the precious metals market and what convenience you are paying for, once you have decided that the price is right or wrong for you, that is all that matters. Not suspicion of the device or whom to trust. A human with more knowledge than the next guy can cheat you when you defer your trust to them just as easily as can a machine set to solicit peoples money through convenience and gimmicks can cheat you if you don't posses the same knowledge you need to have even when buying from your local trusted dealer. Without the proper knowledge one shouldn't be buying precious metals period. There is no reason to blame a lack of knowledge on machines or people who implement them just because we do not know them.

 

Call me crazy, or old fashioned, but I prefer to talk to people when it comes to any major purchase. Customer service is important to many people including myself. I'll pay the few extra dollars. Sorry to ruffle anyone's feathers.

 

You are not experiencing a conspiracy with these vending machines any more than you are old fashioned, but you are failing to see the point I tried to illustrate. One can chat with a human all they like when making a (major) purchase, but you still need the requisite knowledge of what you are buying and what its value is so you are paying the appropriate amount of what it is you are buying. You cannot solely take comfort and trust in a dealers prescience and personality or some customer service provider stroking your ego while handing over your money for said item without understanding what you are getting for your money. Dealers are expert at negotiating and will make money on the transaction even if they can spend time shooting the breeze with you. Maybe you like your dealer because he doesn't understand the transaction as well as you do, so you get good deals. The vending machines dispensing gold may not be as good a deal as your local dealers, but the dynamics of pricing are different with the vending machine, as I explained earlier: convenience and other overhead costs being worked into the pricing. Most folks see the gold vending machine as the gimmick it is but fail to realize that it's not directly marketed at them. The media is marketing you with sensational stories to garner your attention to the media outlet. Most people will do better and find the best most responsibly priced bullion devoid of additional overhead, shipping and such, by buying from their local dealers or local coin shows at in person transactions. Others may find agreeable deals with direct mail orders if they have no local sources. No feathers have been ruffled in the discussion and responses herein. It's is just important to take these stories with a grain of salt and not deflect them with negative overtones that are suspicious of their products purity, security or impersonal nature.

 

Yo man! Gimme da gol!

 

You have to earn it like everything else kid.

 

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That couldn't possibly be correct, as that would mean there would be more than 3 BILLION vending machines in this country (Japan). No way, not even in this vending-machine-saturated country. :bangg:

 

LOL! Oh boy! did I ever get that one the wrong way round, let's flip that fact, one machine for every 23 people, from Vending Machines: Japan [Wikipedia.org]:

That is still a lot of vending machines per capita.

 

I will agree that that is still a lot of vending machines! In my neighborhood, there are at least 6 outside drink machines within a 2-minute walk from my apartment!