Current Market Rates Per Ounce
November 27, 2014 9:21:04 AM PST
J&M Coin & Jewellery Ltd.
127 East Broadway
Vancouver, BC, V5T 1W1, Canada
Tel: (604) 876-7181
Toll Free Ordering: 1-888-244-9999
Fax: (604) 876-1518
This page outlines some of the more commonly asked questions about buying and selling bullion. If you have any questions about the process that are not answered here, please send an e-mail to inquire.
Q: If the spot gold price is $X, why are you charging me more than $X?
A: Bullion dealers like J&M are not a volunteer or charity operation. We make money by buying and selling precious metals with a small margin to cover costs such as minting, delivery, staff, vault storage, security, investment carrying costs, and so forth. In business, most retail items are significanlty marked up from wholesale, and wholesale prices are above cost -- this allows a profit margin for the seller or buyer. In the case of bullion the margins (or "spread" as it is sometimes called) is VERY small. It is only by trading in volumes that revenue can be achieved.
Q: Why do some gold or silver coins trade as bullion and some as collectibles?
A: Historically, there were many gold and silver coins that circulated as spending money, such as the USA $5, $10, and $20 coins, the Newfoundland $2 coins, the France 20 Francs, the German 20 Marks, and so forth. Recently, many of the world's mints have created special coins for collectors out of precious metals, such as the Canadian $100 gold coin issues. Although there is precious metal in these coins, they are not pure. They are valued for their design or their rarity rather than for their precious metal content. True bullion coins are minted with designs but are traded primarily for their gold content, such as the USA Gold Eagle and Buffalo, the Canadian Maple Leaf, the South African Krugerrand, the Chinese Panda, and so forth.
Q: What is the difference between recognized and unrecognized bullion bars?
A: A recognized bar is one that was minted by a major refinery that is very well known and may have international locations or presence, such as Johnson-Matthey, Engelhard, Credit Suisse/PAMP, and the Royal Canadian Mint. We also consider our own J&M .999 fine 100 oz. silver bars to be recognized. Unrecognized bars are from smaller local refineries that may or may not be in business. The purity of the bullion may be the same but major financial institutions will not accept them. Bars from recognized manufacturers may also be treated as unrecognized if they have major defects, scratches, or bruises. They might also be older poured bars. The reason that recognized bars fetch higher prices is simply one of confidence. It is much easier to sell recognized bullion products than unrecognized.
Q: Why is the face value of a one ounce coin only $50 but you are selling it for $700?
A: Many mints issue bullion in coin form and to be a coin it must have a negotiable face value (also known as the denomination). At the very least, the mint (and national treasury) guarantee the coin to have the value shown on the coin. However, the bullion content typically is much higher than the face value. These bullion coins are bought and sold based on how much bullion they contain and the market rates for the bullion.
Q: What taxes apply to bullion purchases?
A: This depends on your location and the purity of the precious metal. Almost all of the items listed in theis website are pure so there are no applicable taxes to the precious metal, although GST or HST will apply on shipping within Canada. If you are located in the USA then there are no taxes applicable whatsoever.
Q: How do I know I can trust J&M?
A: We have been in business since 1967 and we have established an excellent reputation globally for quality of service and products. We are members of the ANA, CNA, CAND, the Jewelers Association, and numerous other accredited associations and attend the major coin shows in Canada and the USA. We are active buyers at most major Canadian coin auctions in Canada and the USA -- we even have our own online auction service exclusively for coin, stamp, watch and jewellery clients. If you are a North American coin collector or dealer then the odds are that we have done business with you before. Any major dealer can be contacted as reference for our trustworthiness and solid reputation. You can also check with the Better Business Bureau and trade newspapers or magazines. We rarely get complaints. Also, bank references can be provided on request.
Q: Why do I have to complete your online booking form to purchase from J&M? Don't you trust me?
A: Unfortunately it only takes a few bad apples to spoil the barrel. J&M has experienced several cases of fraudulent purchases by amateur and professional con artists and been left out of pocket while dealing in good faith. We wish it were otherwise but have established the procedures we currently use as a way of protecting both yourself and J&M -- it works both ways. Just as when you buy and sell stocks, you need to sign a contract with your broker to deposit money before you can trade. We require a contract. The broker buys you stock for your account. We are buying precious metals for you. As stock prices are always going up or down, the same holds true for precious metals -- only a lot more rapid than stocks. The margins are low and the risks are high.
Q: What are the government regulations regarding the purchase, sale or storage of bullion? What are my IRS/CRA reporting obligations?
A: We are not required to report any purchases or sales in Canada unless you purchase $10,000 or more and pay by cash. In this case we are required to complete a Cash Declaration Form that provides information on the source of the funds.
Q: Is there a limit to how much bullion I can buy or sell?
A: There is no limit other than our current supply. We may not be able to provide massive quantities immediately (though we can make arrangements as needed) and we may be over-stocked and not buying at the time. (In this case, if you are willing to take a post-dated cheque then we probably will still buy.) Any purchase of $10,000 or more paid for by cash per day in one or multiple transactions will require the completion of a source of funds Cash Declaration Form in accord with Canadian laws.
Q: Does J&M report my sale or purchase of bullion to any government or financial agency?
A: Generally speaking ... no. All customer information is kept private in house and is not sold, leased or rented to any other person, company or agency. The information obtained is used only for the transaction at hand. However, if you are selling bullion to us in our Vancouver store, city bylaws do require that we obtain photo ID which shows your current address. This information is entered into a special Vancouver Police Department Anti-Theft website and is only used to search against goods reported stolen.
Q: What's the best way to store my bullion? Will J&M store it for me?
A: J&M does not store customer's gold, silver, platinum, or palladium for the following reasons: Holding a paper receipt is not the same as having the actual physical inventory on hand; especially considering the current over-availability of paper compared to physical supply. (Please see Everybody Wants it). J&M does not wish to carry the liability. Neither J&M Coin & Jewellery Ltd. -- nor any other independent business that is not a bank, trust company, or credit union -- has government depository security insurance. All businesses are subject to bankruptcy, therefore you could be subject to loss. J&M is a successful operation with 40 years of proven customer service and satisfaction and, as a responsible business, we will not subject our clients to the possibility of loss. Recommended safe storage for physical bullion is a safety deposit box at a government depository security insured bank, a trust company or credit union, or some very secret spot in your home that your friends, relatives, and children do not know about. You should be able to access your bullion whenever you need to with 100% certainty.
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