Category: Platinum
Is it safe to buy gold?


I would like to hear your thoughts about this topic. Today I posted the article I saw on latimes.com about Goldline.
Prosecutors have filed criminal charges against Goldline International Inc.
This is an article you need to read, Goldline is one of the largest precious metal dealers in the world, most people feel safe buying from companies like Goldline because of how large they are and really as you can see that’s not the case. I advise you to be cautious when investing your money through anyone, do your research. That’s why websites like ours exist. We show actual customer reviews from their experience on purchases from specific gold dealers, and live up to date prices on their products, like gold coins, gold bullion, silver coins, silver bullion, platinum coins and platinum bullion.

 
Gold dealer (Goldline.com) Prosecutors have filed criminal charges against Goldline International Inc.


Goldline gold & precious metals dealer is charged!

Prosecutors have filed criminal charges against Goldline International Inc., a Santa Monica company that is one of the nation’s largest gold dealers, for allegedly tricking customers into buying gold coins at inflated prices.

The Santa Monica city attorney’s office accused Goldline of running a “bait and switch” operation in which customers seeking to invest in gold bullion were instead sold gold coins that were marked up more than 50%

The  company, which used radio talk show host Glenn Beck as a pitchman, has seen sales soar in recent years along with the price of gold. In one ad campaign, Beck said Goldline was “a top-notch organization”  and in another said it was the “only gold company I recommend and use.”

Beck did not respond to an email seeking comment for this story.

The 19-count criminal complaint accused Goldline Chief Executive Scott Carter and five other current and former employees of promoting coins as a better investment than bullion without disclosing the markup.

Goldline, which had more than $500 million in annual sales, denied wrongdoing and vowed to fight the charges. Founded in 1960, the company employs more than 300 people.

“The so-called bait-and-switch allegation is preposterous because bullion accounts for more than 40% of the ounces of gold sold by the company during the past year,” Brian Crumbaker, the company’s executive vice president, said in a statement.

“We believe Goldline has industry best practices in customer disclosures enabling the most informed decisions.”

Among the charges against Goldline was one misdemeanor count of elder abuse for allegedly defrauding a client in July 2011. Prosecutors also accused the company of falsely promoting its coins as “rare” and claiming that bullion could be seized by the government while coins could not.

The company encouraged salespeople to steer customers into the overpriced coins by offering commissions on coin sales that were 2,000% more than the commissions for bullion sales, the complaint alleged.

Also accused in the criminal complaint were Goldline’s former CEO Mark Albarian, executives Robert Fazio and Luis Beeli, and sales agents Charles Boratgis and Stephanie Howard. Each of the defendants is scheduled to appear in court Jan. 4 for arraignment. Albarian could not immediately be reached.

Gold prices have soared in recent years, along with other precious metals. Just this year, gold has risen 22% to $1,728.70 an ounce on Wednesday.

stuart.pfeifer@latimes.com

 
Investors (and the Fed) are addicted to liquidity


By Paul R. La Monica @CNNMoney October 26, 2011: 12:58 PM ET With long-term bond rates as low as they are, is there really a need for the Fed to try QE3 to push them down further?
With long-term bond rates as low as they are, is there really a need for the Fed to try QE3 to push them down further?

NEW YORK (CNNMoney) — The best you can say about “The Godfather: Part III” is that Sofia Coppola recognized her limitations and now spends more time behind the camera than in front of it. “Superman III” proved that Richard Pryor was no Gene Hackman.

And “Return of the Jedi?” I defer to Dante from “Clerks.” All that had was a “bunch of Muppets.”

The third time is rarely the charm in Hollywood. But don’t tell that to investors and central bankers who are loudly calling on the Federal Reserve for a third round of bond buying to help stimulate the economy.

Fed vice chair Janet Yellen, Fed governor Daniel Tarullo and NY Fed president William Dudley have all hinted in speeches recently that another so-called quantitative easing program, or QE3, could be possible.

Why? The Fed has already pumped trillions of dollars into the economy with the first two renditions of QE. It has left its key interest rate near zero since December 2008 and has pledged to keep rates low until the middle of 2013.

And the Fed is buying even more bonds now through Operation Twist, a program that allows the central bank to sell short-term Treasuries and trade them in for longer-term ones so it doesn’t have to add more to its already bloated balance sheet.

What has this accomplished? The economy is still in a sluggish growth phase that feels more like a recession than a recovery. Unemployment remains above 9%. QE ad infinitum isn’t going to change things. Only time will.

“People believe, despite all evidence to the contrary, that there is this omnipotent being at the Fed who can push the right buttons and get the best outcome for the economy,” said Bob Gelfond, CEO of MQS Asset Management, a global macro hedge fund based in New York.

“There is a refusal to just let things in the economy play out,” Gelfond added.

Is Operation Twist already a failure?

But the 10-year Treasury yield is at 2.17%, not much higher than its record low! So it’s a great time to refinance or buy a home .. if you can find a bank to approve your loan. Oh yeah.

More liquidity is not the answer. The economy isn’t being constrained by the affordability of credit. Turning the U.S. into Japan so we can have even lower rates isn’t going to help.

“Quite frankly, the problem existing in the economy right now is whether or not businesses feel confident enough to ask for loans or for consumers to qualify for one,” said Terry Clower, director of the Center for Economic Development and Research at the University of North Texas. “Do we want to encourage borrowers to take on more debt they can’t afford?”

Another possible consequence of more easing is that it could devalue the dollar and lead to higher commodity prices. Even if that isn’t textbook inflation per se, the last thing the U.S. consumer needs is to pay more at the gas pump and grocery store.

Dan North, chief economist with Euler Hermes, a credit insurer in Baltimore, worries that the Fed might be willing to risk that in order to prove it is trying everything it can to get growth back on track.

“It’s possible we’ll get QE3 because it seems like the Fed always has to be doing something,” North said. “But the problem is that you can’t erase injecting that much money into the financial systems without some inflation concerns.”

However, the Fed might be able to help matters with a more targeted form of easing.

Doug Cote, chief market strategist with ING Investment Management in New York, said if the Fed were to only buy mortgage-backed securities, that could push mortgage rates lower without the potential nasty side effects of creating pricing pressures. Tarullo has in fact proposed such a plan.

But Cote said that the Fed would also have to work with mortgage buying agencies Fannie Mae and Freddie Mac as well as banks to loosen some of the constraints on who can refinance. Dudley has said this is something he favors too.

Lower rates still won’t help if nobody can take advantage of them. Cote argues that any borrower current on their mortgage should be allowed to refinance, even if the value of their home has plunged.

“I am against the concept of indiscriminate bond buying. That exposes taxpayers to a lot of risk,” Cote said. “But broadening the base of borrowers that can refinance by eliminating constraints on people with underwater mortgages can only help consumers.”

Brazil cuts rates. Is China next?

That may be true. Still, the Fed would be foolish to keep throwing money at the problem. It can’t stay in firefighter mode indefinitely.

The latest gross domestic product figures will be released by the government on Thursday. According to 21 economists surveyed by CNNMoney, GDP for the third quarter is expected to rise at a 2.5% annualized pace.

That’s still not fantastic, but it would be a major improvement from the first half of the year. And as long as the economy is in slow growth mode as opposed to a full-blown crisis, it’s just greedy to expect the Fed to step in all the time with more bond buying.

Sure, investors may want and crave more quantitative easing. The market, to paraphrase Robert Palmer, might as well face it: It’s addicted to liquidity. (Cue the tall girls with the pulled-back hair and short, black dresses!)

Anything that pushes borrowing costs down further, makes bonds less attractive and weakens the dollar is like manna from heaven for the earnings power of big multinational companies. But the Fed should not bow to the demands of traders.

After all, the hole we’re still trying to dig out from was partially created by a period of easy money that lasted too long.

“All of the QE3 talk is just trying to put Humpty Dumpty back together again so we can go back to 2006,” Gelfond said. “It just prolongs the inevitable.”

The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, and Abbott Laboratories, La Monica does not own positions in any individual stocks. To top of page

 
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