Bullion Services - True Values

What are physical precious metals?

When speaking of precious metal ownership, it is important to know that there are different types of precious metal ownership.

Precious metals in paper form:
Quite a few people buy precious metals from the bank, for example. They pay from their bank account and receive a receipt confirming they have a certain amount of bullion. The situation is similar when you buy on the stock exchange, for example Xetra Gold. These people now think that they are owners of precious metals. However, if you buy or have bought bullion in this way, you do not actually own bullion. You only do have a claim, a piece of paper, for the corresponding precious metals. This "form of precious metal ownership" is called "precious metal in paper form" or also paper gold, paper silver, etc. If your bank should now become insolvent, for example, then you can queue up with your claim and will probably get nothing in the end.

Physical precious metals:
Physical precious metals are precious metals that you actually own and can touch and hold. You own the real bullion and not just a claim on paper bullion. First of all, it doesn't matter where you store these precious metals. What matters is that you are the sole owner and that these precious metals are in physical form, for example in the form of bars.

Why should everyone own physical precious metals?

On the one hand, physical precious metals are a diversification of your investments, but above all they are an insurance against loss of purchasing power and your own loss of prosperity in the event of a severe financial crisis, a depression or a currency reform. For this reason, it is often recommended that one should hold at least 15% of their wealth in the form of physical bullion. This is a very general statement and everyone should determine for themselves and their own situation how much they invest in physical precious metals.

Diversification:
If you take a quick look at your investments and your wealth and consider how much of your total wealth you have invested where, most people will very likely find that they are somewhat biased in investing. Your entire wealth could be at risk. If you own a property, then probably a very large part of your wealth is in this property. Do you own shares? If so, how many shares in what currency are these shares and what country, continent are these companies located? What currencies are your assets divided into? People in the US probably hold most of their wealth in USD and in Europe in Euros. That's the way it is, but is it good and useful? As an EU citizen, how much of your wealth do you hold in physical precious metals and how much in euros? The answer will often be: no physical precious metals and everything else in euros. You therefore have a cluster risk in euros. Physical precious metals in Canada could be a very good diversification here.

Insurance against loss of purchasing power:
Physical precious metals are good insurance against a loss of purchasing power. The two monetary precious metals gold and silver are particularly suitable for this purpose. Gold and silver have been a means of payment and a store of value for thousands of years. No other form of money is as old and enduring as gold and silver. All other currencies, on the other hand, lose value and thus purchasing power very quickly. Since its introduction in 2002, in about 20 years, the Euro has already lost around 25% of its purchasing power. What would have happened if, for example, when the Euro was introduced, you had exchanged some of your D-Mark holdings for gold or silver instead of Euros? At the beginning of 2002, a troy ounce of gold cost around 250 euros and an ounce of silver around 4.13 euros. On April 15, 2022, a troy ounce of gold cost around 1,975 Euros and an ounce of silver around 25.67 euros. So in the period when the Euro lost about 25% of its purchasing power, silver is up about 6.2x and gold is up about 7.9x. If, for example, you had invested D-Marks worth 100 Euros in silver or gold back then, on April 15, 2022, these 100 Euros would have had a value of around 620 euros in the case of silver and around 790 Euros in the case of gold. This clearly shows how little sense it makes to keep money in a savings book or bank account. Against the background of the current high inflation, one can actually say that it is negligent not to exchange your savings for physical precious metals.

Insurance against loss of wealth:
Physical precious metals are the best insurance against one's own loss of prosperity in a severe financial crisis, depression or currency reform. The two monetary precious metals gold and silver are particularly suitable for this. It is assumed that in such a severe crisis, these two precious metals will rise in value to offset all other losses if at least 15% of your assets are invested in one of these two or both precious metals. However, there is no guarantee here, just like anywhere else, but you should know that physical precious metals are the only products that do not involve any counterparty risk.

Which physical precious metals should you own?

Gold and silver are the only precious metals that have a monetary function, with gold being stronger in that function. Gold and silver are also the most traded precious metals. Platinum and palladium are pure industrial precious metals and have no monetary function. Silver is the only precious metal that has both monetary and industrial functions. About 60% of all silver is consumed in industry and a significant portion of that is lost forever.

In general, all precious metals tend to develop more or less together in terms of price, and exceptions here confirm this rule. Therefore, your own preferences often decide in which precious metal you invest. However, silver is unique and has some peculiarities as described in the next paragraph and therefore overweighting it versus the other precious metals can make sense.

Why is silver so unique among all precious metals?

Silver has been used by mankind for over 5,000 years.
Silver is the precious metal most consumed in industry.
Today there is about 5x less silver in circulation than gold.
Silver has unique properties that make it often irreplaceable as an industrial metal.
Silver has the highest light reflecting properties of any metal.
Silver is the best conductor of heat among all metals.
Silver is the best conductor of electricity of all metals.
Silver is so extremely elastic and soft that it can be processed into transparent foils 0.002mm thick.
Silver is therefore also suitable for the production of filigree wire (2km of wire weighs less than 1g).
Silver kills over 600 different bacteria and finds new applications here every day.
Silver is often only processed in very small quantities, which is why recycling is often uneconomical and large quantities of silver are lost forever.
Industry already consumes more than 60% of all silver that is produced.
Silver is the most important industrial metal today, with well over 10,000 uses.
More and more often the annual consumption exceeds the annual production of silver.
No other substance on earth plays such a strong dual role (raw material and precious metal) as silver.
If the global economy weakens, the need for investment in silver usually increases significantly.
The more technology and electrification advances, the more silver is needed.
Silver consumption per capita is about 70x higher in developed countries than in emerging markets.
The demand for silver in emerging and developing countries will increase significantly in the future.
Silver is becoming more expensive to mine and less silver is being produced per ton of ore.
The silver reserves are coming to an end and silver is becoming increasingly scarce.
The industry itself does not stockpile silver yet. This could change soon given how important silver is.
That's why silver is probably the most undervalued commodity out there.
That's why silver is probably the best long-term investment out there right now.

Where to buy and store physical silver?

Store precious metal at home:
Small amounts of precious metal can be kept very well at home. Above a certain amount, however, the risks increase. If you keep precious metal in your home, then you should not tell anyone, including your best friends. The more people know that you have precious metal in the house, the greater the risk that it will be passed on and ultimately this information will end up with the "wrong" people. If you say that you have around 500 euros worth of precious metals in the house, you may not think much of it and feel safe about it. But the truth is often twisted as the story goes, and after a week it might be as much as $50,000, and after a month it might be told that you keep hundreds of thousands of dollars worth of precious metals in your home. For this reason alone, we do not recommend keeping any precious metal in your own home unless truly no one else knows about it.

Store precious metal in a safe deposit box:
If you store precious metal in a safe deposit box, the risk of your home being robbed is significantly reduced. However, you expose yourself to other dangers by storing them in a safe deposit box. For one thing, your precious metals in the safe deposit box are not insured and if they are suddenly gone, you will have to prove what you had in the safe deposit box. This will be very difficult if not impossible. Such cases have happened, albeit rarely, and it has always been a total loss. Another danger is the insolvency of your bank. If the bank doesn't open its doors tomorrow, you won't be able to get to the safe deposit box you rented. For these reasons, precious metals and other valuable items should not be kept in safe deposit boxes.

Store precious metal in the bonded warehouse:
There are quite a few companies who want to sell you precious metals and then store these precious metals for you in a bonded warehouse. However, storage in duty-free warehouses also has its own problems, which people like to keep secret. A bonded warehouse is a state facility and therefore everything that happens there is monitored and registered by the state. It is very unlikely that you will be able to pick up your precious metal there yourself, and even delivery to you will usually be refused, since it is not you, but the precious metal dealer from whom you bought it, who is registered there as the owner. If delivery to you is possible, this will be recorded in writing by the responsible state authority and you will have to pay the corresponding import sales tax. You also have no real certainty that your precious metal is actually there. A bonded warehouse is a large commercial warehouse designed to facilitate the importation and exportation of products, and the mere storage of precious metals and other valuables abuses the very purpose of a bonded warehouse. At the bonded warehouse, you should ask yourself the following questions:
Do you know how and on what terms you can get your precious metals?
How do you get your precious metals if your dealer is no longer there (keyword insolvency)?
Can you sell or collect your precious metal in a crisis? How?
During a crisis, the physical removal of your precious metals from the bonded warehouse is unlikely to be practically possible. The bonded warehouses are huge warehouses that store goods belonging to thousands of people and companies. In a crisis situation, thousands of people and companies will probably try to get their goods out of the bonded warehouse. However, there are only a limited number of customs officers on site who have to document and account for each removal.
This makes it clear that the bonded warehouse is a very bad form of storage for your precious metals in an emergency.

Store bullion in high security storage, in Canada, outside the banking system:
Canada is one of the most economically and politically stable countries in the world.
Precious metals silver, platinum and gold are exempt from sales tax in Canada.
No official registration, no customs officer.
Diversification out of the euro area and out of Europe.
Storage outside the banking system.
The stored precious metal is fully insured.
The customer becomes 100% economic and legal owner.
The customer receives a new stock overview of his precious metals whenever there is a change in stock.
Sale and delivery is possible at any time.
Viewing, touching, counting and photographing your own precious metals is possible.
There are no taxes or customs duties on sale or delivery in Canada.

Conclusion:

Silver is the precious metal with the greatest potential among all precious metals. Physical silver bought in Canada offers the ideal diversification and hedging for people and companies from Europe. Stored in the high security warehouse, outside the banking system, in one of the safest countries in the world offers you total peace of mind.

Buy your physical silver from Bullion Services and store this silver through Atlantic Canada Metals Inc. in high security storage in Canada.

Important, please read:

All of our articles have been created to the best of our knowledge. Nevertheless, no guarantee can be given for the complete correctness of our articles. We live in a world that is changing at an ever faster rate and so laws, regulations and conditions that we have researched for our articles can change at any time or have already changed. For up-to-date information, please do your own research and ask the responsible authorities yourself or contact us.

This information does not constitute advice, nor is it an invitation to make any investments or to buy or sell precious metals or other products.

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