The Benefits of Investing in Gold and Silver. If you can t hold it, do you really own it?

Transcription

1 The Benefits of Investing in Gold and Silver If you can t hold it, do you really own it?

2 Gold and Silver: Timeless Currency Through history, the value of fiat currencies (not backed by tangible commodities) has inflated and deflated wildly with global events, political pressures, and stock market conditions. However, precious metals are a timeless, global currency, often more stable than other currency and stock Robert Kiyosaki, market products. investment guru and author of Rich Dad, Poor Dad Gold and silver are not prone to the influence of the world s foolishness. They carry real, sustainable value, and we believe they can help investors protect their savings. Wise investors use gold and silver as a hedge against inflation and other economic stresses, as well as a store of value that historically has often outperformed other investments. Some investors hold gold and silver to trade for goods and services. The Brilliance of Gold and Silver Demand for gold and silver is rising and scarcity is increasing, a trend some experts believe will continue into the foreseeable future They are portable, liquid (easy to sell) and easy to store and they can be confidential They tend to hold their value against inflation and even can increase in value during tough times Worldwide industrial silver use surpasses mining and recycling, significantly driving up value Gold and silver currently are considered some of the world s most stable investments Forms of Gold & Silver for Investment Commodities such as gold and silver have a world market that transcends national borders, politics, religions, and race. Bullion Coins Bullion Bars Ingots Numismatic Coins Jewelry This world-standard investment includes rounds and legal tender. Popular with large investors who want the convenience of bulk metals. Usually smaller and less expensive to manufacture, so cheaper to buy. Less pure and more costly to make, so not as valuable per ounce. Used as a common method of saving and displaying wealth worldwide. 2

3 Modern-Day Precious Metals Investments At Augusta, we believe holding actual metals in a secure account provides more benefits than other gold and silver investments, such as exchange-traded funds (ETFs). No exchange-related or counterparty risk. Unlike ETFs, physical gold and silver exist entirely outside of securities markets and related parties. Genuine, effective diversification. Uncorrelated with equities, which means they can balance your portfolio when stocks are dropping in value. Legal claim to actual assets. No matter how many ETF shares you own, you have no legal claim on your investment account s underlying assets. Where & How to Buy Gold and Silver Gold and silver are mined from the earth, processed at refineries, and formed into bullion (including coins), then stored in vaults and sold for a variety of purposes. Private investors obtain gold and silver from providers such as Augusta Precious Metals. Many providers simply take your order and send the metals to you or a depository. Augusta is not just an order taker. Our highly professional, well-trained team works closely with you as partners. We inform you about regulations and investment best practices, help you evaluate options, then guide you to confident decisions and do most of the legwork to carry out your wishes. Did you know... Silver, with a relatively low spot price, is known as the common man s gold. Silver s accessibility to all socioeconomic classes increases demand, which can result in a higher value. Both gold and silver are measured in troy ounces. One troy ounce is about 10% heavier than one ounce. The name is thought to have originated at a fair in Troyes, France, during the Middle Ages. During the Roman empire, an ounce of gold bought a toga, leather belt and a pair of sandals for a wealthy man. Today, one ounce of gold still buys a suit, belt and a pair of shoes. 3

4 Gold s Growth Potential The history and benefits of investing in gold Physical gold costs more than silver by the ounce, but many investors believe it s the world s most reliable investment. Gold has a long history of storing value outside the influences of the world. No one argues that gold s value goes beyond borders, economic stresses, and political unrest. Poor Policy = Great Opportunity Gold is a treasure, and he who possesses it does all he wishes to in this world, and succeeds in helping souls into paradise. Christopher Columbus, 1400s Explorer After 1971, by some estimates, the value of gold rose about 3,000% higher than the value of the U.S. dollar rose. In the past, the price of gold has increased within one decade by as much as 400%. Gold Price (USD/oz) Unlike stocks, which increase in price due to earnings growth, gold mainly increases in price due to devaluation of currency. When U.S. politicians fail to balance the U.S. budget, the Federal Reserve prints dollars to pay government bills. New dollars drive up gold s price, because it can t be mined as quickly as new dollars are created. Gold is Wealth Insurance Most investors value gold as an inflation hedge, but gold holds value because it s a finite resource it can t be created or printed and must be mined. The trade supply of gold is reduced as gold is used for jewelry, a traditional form of savings in many countries. In times of deflation and financial uncertainty, investors buy gold to preserve value. That s why gold is thought of as wealth insurance. It pays when the economy suffers just as home and car insurance pay when accidents happen. We believe it s unlikely the United States government will ever balance the nation s budget, reduce its deficit, and lower its debt, but gold is likely to continue rising in price and remain an important part of every American s investment portfolio. The Scarcity of Gold It s estimated only 171,000 metric tons of gold have been mined through human history. Realistic remaining attainable deposits total about 52,000 metric tons. The world s entire supply of gold could be melted down to make a cube measuring about 20 square meters. 4

5 Can Gold Overcome a Falling U.S. Dollar? United States currency used to be backed by physical gold the gold standard. During the Civil War, politicians abandoned the gold standard and began to print money to pay bills. Because gold then aligned with many more dollars, its price rose significantly. U.S. Dollar Real Purchasing Power, Gold vs U.S. Dollar 1965 = 100 as defined by the CPI Gold (USD/oz) Gold and silver, like other commodities, have an intrinsic value, which is not arbitrary, but is dependent on their scarcity, the quantity of labour bestowed in procuring them, and the value of the capital employed in the mines which produce them. David Ricardo, 1700s British political economist In 1971, we permanently abandoned the gold standard, which made the U.S. dollar a fiat currency only paper and numbers. This manipulation is what experts believe causes constant inflation and decreases our dollar s purchasing power. World events further erode the value of the dollar. Gold cannot be created from nothing as the dollar can, and that s one of many reasons it retains value. It has been a respected tool of trade for many generations, and that s not likely to change soon. Facts About Gold China s stock market and currency instability and manic real-estate markets have forced Chinese investors to buy gold instead, which could increase gold s price worldwide. Gold is purchased and held by most central banks across the globe (the biggest owners of gold) as a way of stabilizing their own investments. Many people believe you must be very wealthy to buy physical gold. However, citizens of many countries at all socioeconomic levels often own gold bars. 5

6 Silver: A Virtual Goldmine The history and benefits of investing in silver When all else fails, there is silver. David Morgan, economist and co-author of The Silver Manifesto Physical silver costs less than gold, which makes it accessible to more investors while providing many of the same benefits. A recent high ratio of gold/silver prices and increase in demand make it an investment of choice for many. The Many Uses of Silver Increase Its Value Silver has many more industrial uses than gold, and its uses are expanding. It is used in everyday items such as cars and computers and is essential to growth industry products such as solar panels and water purification systems. The medical field is taking advantage of silver s unique antibiotic properties to make medicinal paper. Because it s the best metal conductor of electricity, silver s importance is unequivocal in electronics. Gold Prices vs. Silver Prices (U.S. Dollars) Gold Price (USD/oz) Silver Price (USD/oz) Of course, silver remains a staple in jewelry, which is used around the world as an investment. In simple supply-and-demand terms, the market is demanding more silver than we can supply, which has caused a substantial increase in silver s value. Money Supply Grows, Silver Prices Rise Some analysts report the U.S. monetary base more than doubled from 2008 to 2010, and U.S. banks increased their reserves by more than $1 trillion. When banks begin lending reserves, inflation is likely to hasten. We believe the world will drown in excess money for a time and prices will rise. After that, who knows? Silver could be the best hedge against this kind of economic pressure. 6

7 Get the Protection of Silver Silver protects wealth and, over the long term, consistently increases in value. Increased silver bullion prices correspond directly with increases in the money supply. Take a look at the chart on the previous page, particularly after 2008, during the Great Recession. The price of silver shot up when the Federal Reserve dumped trillions of dollars into the money supply. Scarcity and Undervaluation of Silver In addition to its increasing popularity in commerce and manufacturing, as silver becomes scarce, its value-to-price discrepancy is yielding historically low trading prices. Of all the contrivances for cheating the laboring classes of mankind, none has been more effective than that which deludes them with paper money. Daniel Webster, 1800s U.S. Senator The historic price ratio between gold and silver has been as low as 15:1 and as high as 100:1. Throughout the 20th century, the ratio averaged about 47:1, and since 2000, the ratio has been as high as 80:1. Right now, the ratio is hovering around that same 80:1 figure, strongly suggesting that silver is extremely undervalued by the market and poised for a significant price jump in the near term. We believe silver now offers enormous short-term and longterm earning potential relative to gold. In addition, the media s heavy emphasis on buying gold in the last few years makes silver a hidden treasure. Facts About Silver China and other large, emerging middle classes depend on silver to produce everyday products, which increases its value. Worldwide industrial uses of silver surpass silver mining deposits and recycling production, significantly driving up silver s value. The U.S. silver stockpile for national defense has been depleted, which increases the value of the world s remaining silver. 7

8 Informative, patient answers I recently made my first metal purchase and after much research I made it with Augusta Precious Metals. Since I had never bought metal, I had a lot of questions. They were both informative and patient. Their attention to detail and step by step guidance was awesome. Gary G. A perfect customer service IRA company! I received great service, received excellent products, and I was able to do all of this from home at a reasonable price. They did not even charge me for shipping. I am very satisfied with the whole experience. David F. 5-star process for ordering precious metals This was my first time/ experience investing in precious metals. Augusta was great. The process of setting up the LLC for a self-directed IRA and then ordering of metals...a thru Z was very smooth. I m extremely pleased. Yep...5-Star Process. Norma W. Augusta Precious Metals The Brilliant Choice to Protect Your Savings If you re looking for a smart way to potentially overcome negative economic influences on your personal savings and leave an exciting, tangible legacy for your loved ones, consider physical gold and silver. These time-honored physical assets provide a true store of value and genuine diversification. Augusta is a precious metals provider known for deep experience, exceptional and transparent customer service, and the lowest prices in the industry. Call today to speak to your personal Augusta account executive Augusta does not provide legal, tax, or investment advice. The Augusta Gold & Silver IRA is a self-directed IRA containing physical precious metals administered by a third-party custodian and stored in an approved non-government depository storage facility where investors can make an appointment to see their precious metals. The Augusta Home Delivery IRA is a self-directed physical precious metals IRA stored at home or in a safe deposit box. Augusta s attorneys believe that American Eagle coins may be stored at home and that all other IRA-held coins must be stored, at a minimum, in a safe deposit box at a U.S. bank. However, these attorneys believe it is wiser to store all IRA precious metals in a safe deposit box at a U.S. bank to eliminate risks associated with home storage. The IRS has not provided clear guidance on home delivery or home or safe deposit box storage of IRA precious metals. If your home delivery gold IRA is not set up properly, if you engage in a prohibited transaction (e.g., withdrawing metals before retirement to use for any other purpose), or if it is determined that home delivery or home or bank safe deposit box storage are not permitted by the IRS, you could lose your tax-exempt status and have to pay taxes and penalties. As with any investment, past performance might not predict future returns. The price of precious metals fluctuates over time and investors might lose money. It is important to consult your own legal and financial advisors before buying from Augusta. Augustapreciousmetals.com 8484 Wilshire Blvd., Ste. 515 Beverly Hills, CA Augusta Precious Metals. All Rights Reserved