For every buyer there's a seller. Oh Ya; and a middle man. Mayer Amschel Rothschild has taken a lot of heat over the past couple of centuries about his business practices, but you have to hand it to him; he was good at what he did.
Could hunt some day, but not right now. I share the skepticism of more than a few based on the premium. There are other vehicles right now that are far more available, affordable, and recognizable. This idea could go somewhere at some point, but not until spot price becomes stupid-high so the production costs become proportionally smaller yielding a more "reasonable" premium…and they become super recognizable to many. PM people, I think, are a hard headed bunch about this sort of thing, with pretty sharp pencils.
I imagine I'll pick up a few irregardless, for my own numismatic enjoyment and as props/training aids. Will stick with different vehicles for small value denominations. Just how it is.
Mike
Hi. I've just purchased a couple of notes ($40 excluding shipping costs to the UK). Like jamster777 I've purchased notes in 2014 and 2015. I can confirm $8 per 1/10th note in 2015 and something similar in 2014. I don't see this 65% combined saving either. So I've bought 1/2 gram rather than 1 gram this time. Is someone able to explain the lack of saving?
I llike the product, from a collectable standpoint at least. Not sure where I sit with regards to its eventual use in a post carbon world. I think a lot of good points have been raised and it's hard to know how things will pan out. But I'm partial to anything trying to change the current money system. Good luck guys! Oh this may have been asked in the other shows but would a silver aurum work just as well as a gold one?
Didn't really explain why I think Aurum might have advantage over gold and silver.
Gold has properties ideal for currency. Hence the saying "gold is money". However, it's intrinsic value is not just derived from those properties but also the cost of production digging it up and processing it into a tradable form. Therefore following that logic, if Aurum is gold that is processed into a form that is a more ideal currency (more divisible and harder to counterfeit), the currency is more valuable: intrinsically and due to the increased cost of production). As the result, the question surely becomes when will we choose to hold Aurum over gold? I would think that threshold would be crossed when the extra benefits of Aurum outweigh the the extra cost of production in making the currency over gold. This can be solved two fold: increasing the benefits or reducing cost of production. Currently, the company seems to be working considerably hard on the latter. Is the extra security and divisiblity enough to make it more valuable (in a transaction sense) as a currency compared to more prolific, cheaper perhaps more easily forgeable silver currencies? I'm not sure, depends how the world turns out over the long term. I think this is why it's hard to compare the value of Aurum to digital currencies backed by precious metals. What is considered more valuable would shift depending on what kind of economy we have. Maybe now, in an era of fossil fuels with cheap and plentiful computing resources the latter is more valuable as it's easier/cheaper to use in transactions now. But in the long term maybe when fossil fuels are no longer able to sustain the scale of complexity we have now the former may end being much more valuable. As way of example, if computers become 'extinct' over the long term then the latter would be worthless. On the flipside, if that never comes to pass the former might be worthless. A currency values would depend on the structure of the local (or global if such think still exists) economy. Your perceptions of the future shapes the perceived value of Aurum relative to other currencies. Furthermore, how you use it and when you it play a role. Maybe even one's wealth plays a role. The value of an Aurum would vary from individual but whether it will be considered valuable by the world will depend on the future and the perception of the future. Being a specialised form of gold could be a blessing or a curse.
Maybe this would be more suitable for the precious metals discussion group, since it doesn't relate to Aurum, specifically, but I feel conflicted about trying to acquire products whose extraction is, from what I hear, so damaging to the environment and to the people who extract it. Anyone have insights/thoughts on this?
I wrestle with this question too, and it applies to many things besides precious metals.
One way I deal with it is by purchasing used items when I can, rather than new production. It's not the only reason I like junk silver coins or vintage sterling spoons, for example, but the fact that their extraction costs happened decades ago and they've had a long useful life since makes them feel like a smaller addition to my footprint than new bullion bars would be.
Ditto for just about everything else in life. A good vintage item is a prize. If you need to buy something new, shun cheap junk. Look for high quality and excellent design that will serve you for a long time.
I really appreciate everyone's interest in the Aurum, and also folks' concerns about premiums.
We're very grateful to Peak Prosperity readers, and our goal is to make the best gold product on the market.
I want to respond to three issues: the relationship between the Aurum and spot price, the specific price of Peak Prosperity offerings, and the relationship between the Aurum and digital exchange methods.
First of all, Valaurum's belief is that the bullion industry's obsessive focus on melt value is misleading for consumers. As some in this thread have pointed out, gold earns a different premium depending on several factors, including both increment and form. Naturally, the cost of delivering a rough kilo bar is less per unit than the equivalent 32 finely minted troy ounce coins. Actually, I'd argue that the 1 ounce coins are likely a better product: they're more recognizable, more difficult to counterfeit, and easier to sell. (There's also an aesthetic consideration.) We know of lots of people who stack silver coin, rather than buying heavier bars, for the same reasons.
The rational thing to do with coin is not to melt it, because the gold is more valuable in a coin than as a lump of gold. Melt guarantees a value, but formed gold is more valuable than the lump. A lot of this difference is accounted for by spread–the difference between what a dealer will buy and sell the product for, rather than straight melt value. Valaurum has tried to create highly recognizable, difficult to counterfeit, and interchangeable units of value; we're at the beginning of that process, but I think it's what will ultimately serve our customers. There are tiny bits of gold available in the same increments, from 'bars' that are more properly foil to tiny 20k nuggets (timot78 found some of these). They actually sell for around the same premium as the Aurum, and I invite folks to handle them. When they have, I think the advantages of the Aurum really speak for themselves. Our atomic deposition process creates a product that's far harder to counterfeit and easier to handle, and I just haven't come across a good alternative in the everyday increments we're talking about.
On the specific price of the Peak Prosperity offerings: we really like the Peak Prosperity community and it really helped us get started a bit over two years ago. I have always tried to make limited offerings that are very good deals for its listeners. Our previous offerings were actually under wholesale prices in some cases, because we did an enormous volume of 1/10g in a very short period of time. (We were shocked and humbled by the demand, to be honest.) Although some Peak Prosperity readers got a price of $8/Aurum (about 200% of spot), our bullion dealers have often sold them for $11 or so (~275%). We have worked very hard to bring down our production costs and to pass those savings to our dealers. The current offering of $17 with a coupon for a 1/4g Aurum is 170% of spot; we expect a retail price of ~$20 but I wanted to make sure Peak Prosperity readers got a very competitive deal. We will continue to try to bring down costs, while also increasing features. It's worth noting, also, that the costs of depositing gold in this way scale linearly with thickness: a 1/4g takes about 250% of the machine time as a 1/10g.
(A sidenote about troy ounces and grams: we've gone with grams rather than troy ounces because the fractions are pretty ugly in troy ounces. The correct increment there would be grains, and I looked at making a 'grain'-based product, but even fewer people understand that increment than gram. Gram is internationally recognized, but troy ounces are more familiar to most of our current customers in North America.)
On the question of digital exchange and physical gold:
I like BitGold's offerings. I used paypal today and we regularly make USD transactions by wire and direct debit, just like most people in the developed world. They're immensely convenient and the transaction charges are quite cheap. To me, physical gold is another thing entirely: I trust gold I hold in my hand in a way that is completely different to money that is electronically stored or subject to counterparty risk. I've been on panels with Josh Crumb and I've told him that I think BitGold needs a physical delivery method that's comparable to the increments they are facilitating. A 10g cube is not an everyday transaction. The answer to that problem is the Aurum. We're simply not in the same market.
For those who say physical value products are disappearing, I point them to the issuance of (physical) paper dollars. In our supposedly hyper-electronic world, one would expect paper dollars to disappear, but actually the supply has continued to grow quite rapidly, to where there are approximately $1.4tn of them in circulation. That's quite a market. Interestingly, the US did away with denominations above $100 and $20 is the most common transactional increment. There remains a clear need for physical stores of value. Valaurum hopes to continue to address this need.
The discussion on this thread has often been on a very high level, and I'm very grateful for the attention people have paid. The Aurum probably isn't the vehicle for everyone, but we will continue to make it more attractive, more difficult to counterfeit, and a better value, and we believe it is a sign of the future.
I'm glad people asked about the environmental impacts of gold and silver.
I've been very concerned about this as well, from the very beginning of my time with Valaurum. In the first year, I traveled to artisanal mines in Costa Rica and looked into a number of technologies for mining gold without mercury and arsenic.
One of the biggest problems with gold is that it is so fungible. In practice, gold is often refined in large pools that make traceability very difficult. This has made the certification of conflict-free gold very difficult as well.
Quite a bit of gold is recycled, though historically the United States was far behind the rest of the world in this respect. The ubiquitous "We Buy Gold" signs that popped up around 2008 were in part due to the recession, but were also because the rising gold price stimulated a gold recycling infrastructure. Industrial gold is also commonly recycled.
I am very interested in bringing out a pure recycled gold product, and I would love to hear from Peak Prosperity readers if they feel this is something that would interest them.
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Thanks for responding, Adam. It makes me feel better that you've thought about this and looked into solutions. I'd definitely be interested.