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Local Business

Gold hustlers hard at work

By From page C1 | August 10, 2014

It’s not that they’ve reached a new low, they’ve sunk to a new low.

If it weren’t almost impossible to avoid their commercials on radio and TV, I wouldn’t have them in my (mental) gun sights. I’m talking about the gold hustlers, of course, probably for the 200th time since I’ve had the privilege of writing about the world of investing, finance and even economics for the Daily Republic.

I should say that this gimmick has been used in all sorts of commercials over the years, so you might think that viewers and listeners would realize how sleazy the advertisers are. Look on Google for “Rosland Capital Scams,” and it will take you all day to read the stories. Maybe by coincidence, but as I sit here at my computer, they’re airing a commercial for Lear Capital, which should be right up there with Rosland for low-life commercials.

Before going any further, let’s look back at how gold has performed in the past 12 months. I look at the SPDR Gold Trust ETF, which trades on the New York Stock Exchange under the symbol “GLD.” It’s currently selling for 125.89 per share, which, if you move the decimal point one place to the right, you have the price of gold.

Now – forgive the technical discussion – we can see the range for the past year. The low was 114.346, while the high was 137.55. Translated into the actual price for the precious metal, you can see that gold has done nothing, absolutely nothing, in the 12-month period. Oh, sure, it’s gone up and down in its trading range, but if you were a “buy and hold,” you would have been much better off buying your average stock-based mutual fund.

No, it’s not a conspiracy, but Rosland Capital and Lear Capital are at or near the top of the list of cable channel advertisers. The newest – or oldest – when it comes to misleading commercials is the “Be one of the first 50 callers and you’ll get this certificate ‘redeemable’ in gold.”

So how much gold is it worth? One-20th of a gram, that’s how much. Without doing the math, I don’t think you could exchange it for a can of Alpo dog food. Not only is this “certificate” practically worthless, but this “be one of the first 50 callers . . .” routine is, I would guess, deceptive. Do they mean “be one of the first 50 callers” today, or every time they run the commercial, which might amount to, who knows, dozens or hundreds of times around the country? Or does it mean whatever they want it to mean?

Now, this is just a guess, but what do you think happens when you’re “one of the first 50 callers?” It couldn’t be that a fish hook will be implanted in your lower lip so that you’ll buy gold or silver at inflated prices, could it? I guess the cable networks won’t reject these sleazy commercials as long they’re so profitable. They don’t have the legal obligation to check into the “integrity” of their advertisers, so, as long the advertising money keeps coming in, they’ll run the commercials.

I’ve got an idea. Be one of the first 50 readers to wire $100 into my bank account, and I’ll send you my free book, “How to Make Money in the Alfalfa Market.”

Bud Stevenson, a retired stockbroker, lives in Fairfield. Reach him at [email protected]

Bud Stevenson

Bud Stevenson


Discussion | 9 comments

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  • Understanding Gold and SilverAugust 10, 2014 - 9:40 am

    I little education for Mr. Stevenson. Precious metal investors don't buy precious metal for any gains it might make on a annual basis..Precious metals are held because of the ongoing debasement of our currency. It's a store of wealth! In the 1920's you could take $20 in paper money and buy a $20 gold piece..At that time in the 1920's you could buy a month's worth of groceries for that $20 gold or paper, it was worth the same value. Today..if you had that $20 gold piece in one hand, you could buy 6 months of groceries and I'll bet you can't even get 1 bag of groceries with $20 in paper. Even if you ate Top Ramen everyday you couldn't make it a month on $20 in paper In 1965 you could take 3 paper dollars or 3 silver dollars and each would fill up your gas tank on your car...You can't even buy a gallon of gas today with those $3 paper dollars..but you can fill up your tank twice with those 3 silver dollars. I didn't see any of these facts mentioned in Mr. Stevensons article. I truly believe there will be a day when the masses finally understand what's happening to their assests that are based in paper currency. When you see retirement assets and pensions become practically worthless in Purchasing power there will be shear panic as people vacate the dollar. It will be then a Man's real worth will be measured in Oz. of real money instead of paper.

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  • mdsAugust 10, 2014 - 3:10 pm

    Mr. Understanding Gold and Silver, do you also understand the stock market? So your $20 gold piece from the 20's is worth all kinds of money but your $20 bill in only worth $20 still? That would be true if you stuck it in your mattress for the last 90 years. What would it be worth if you bought $20 worth of shares in a mutual fund 90 years ago?

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  • SayWhat?August 10, 2014 - 8:53 pm

    mds said: "What would it be worth if you bought $20 worth of shares in a mutual fund 90 years ago?" Maybe it would be worth nothing if you chose the wrong mutual fund 90 years ago. Some do go out of business.

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  • mdsAugust 11, 2014 - 9:34 am

    Maybe it would be nothing, maybe it would be worth a lot. If you have bought 100 shares of Walmart in 1972 for $1600 you would be a multi-millionaire right now. The point being gold is an investment just like many other things. The main advantage to gold investment is you know it's never going to be worth nothing like can happen with other investments.

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  • Gold sellerAugust 10, 2014 - 11:24 am

    I curious about all the shops that buy gold--old jewelry, coins, any scrap gold. They must do well selling it somewhere else. Where's the best place to sell gold?

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  • Gold BugAugust 10, 2014 - 12:00 pm

    Not at a kiosk in the mall or at your grocery store! They typically pay about 40 percent or less of the actual value of the gold you wish to sell. Most reputable coin dealers offer a much better deal, up to 80 or 85 percent of value. How to determine the value is easy to do but too complicated to spell out here. Just never, ever sell to anyone you don't know and trust. Never, NEVER mail your gold somewhere to be sold. Both Fairfield and Vacaville have reputable coin dealers and you should get a quote from at least one of them before you sell.

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  • Understanding Gold and SilverAugust 10, 2014 - 12:06 pm

    I totally agree..most of these small shops that advertise "we buy Gold" are looking for clients who have neck tattoos.. I don't sell..but if I had to, I would use a reputable coin dealer.

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  • Understanding Gold and SilverAugust 10, 2014 - 3:57 pm

    I can answer that...$20 in the stock market since 1920 with compounding interest would be worth absolutely zero if the dollar is completely debased. In the history of mankind...all fiat paper currency has collapsed. If you choose to hold these little pieces of paper with 0's on them that is your personal choice...I choose to take paper and buy the only real currency that has been used for thousands of years.

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  • JimboAugust 10, 2014 - 10:46 pm

    Faux News hocks this gold ruse to its uber paranoid lemmings. Glenn Beck for example has dedicated entire segments of his program to explaining why the U.S. money supply is destined for hyperinflation with Barack Obama as president. He will often promote the purchase of gold as the only safe investment alternative for consumers who want to safeguard their livelihoods. When the show cuts to commercial break, viewers are treated to an advertisement from Goldline.

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