Karatbars : Make Money but Selling Overprice Gold Nationwide

While the person complaining about price is correct about "spot" price versus selling price as he observed, the person complaining is also very uneducated about the metals market and how commodities are bought and sold.  If you are going to look at Karatbars you must first educate yourself about the metals and commodities markets.  While "spot" price was (at the time this was written) $38.50 what the author does not know is that no one can buy gold at spot price.  Spot is the price at which metals are traded on the commodities market kind of like a stock price.  It is a meaningless number to the consumer and for the most part is an artificial number itself.

The best price of GOLD, SILVER or PLATINUM is what competition in a “free market” allows for the PHYSICAL PRODUCTS, not what a “regulated” futures market allows.  “Spot price” is the current price for a very large amount of a commodity as traded on a commodity exchange, before commission and delivery. With products minted today, such as the U.S. Eagles, the wholesale price (premium) ranges run above the spot price.  If the coins are proof editions, or certified as Mint State they fall into the area of "numismatic coins" (rare coins) and carry much higher premiums above spot.  For older, established bullion coin products, the premium often drops, which is why South African Krugerrands sell for less than 1 oz.  Gold American Eagles.  (The premiums on numismatic/rare coins – coins which are many decades old and where few survive in excellent condition – can range up to many multiples of their precious metal content values.)

When acquiring physical products in the retail market, the spot price is only a gauge or approximation.  The spot price does not fully account for the differences between the wholesale futures market where the underlying gold/silver bars may not exist (5,000 ounces of silver and 100 ounces of gold) and the retail cash market for coins and bars where they must exist at some price.

Another way to think of the difference between the spot price and the retail market is to compare the price of a futures contract for 5,000 bushels of corn with the cost of 24 cans of canned creamed corn at Costco.  Costco’s prices will definitely be higher because of additional delivery costs, packaging, insurance, storage, and the labor needed to deal with thousands of individuals rather than one or two large customers.

Before writing this rebuttal I did a lot of homework on the net.  One place I found more information about Karatbars itself was at Fraudandscam.com.  Karatbars has received the ONLY positive report ever written about any company by Fraudandscam.com and in fact one of their attorneys visited Karatbars and you can find his entire report right here; fraudandscam.com/investor-alerts/amazing-review-of-karatbars-international-based-on-personal-investigation-of-noteworthy-international-attorney/

Given the current state of currency markets around the world Karatbars makes a lot of sense because as QE continues, the dollar will continue to lose value by leaps and bounds and there has to be an adjustment at some point and it will not be a good thing for consumers.  All Karatbars seems to be doing, from what I can tell, is providing an affordable way to purchase gold in small quantities at prices within reach to the masses while at the same time, delivering the gold to the consumer with several layers of protection proving authenticity, security, and guaranteed value of the metal being sold.  Some other providers of gold have been found to have other metals mixed in with the gold which reduces its value. Karatbars carries a lot of certifications proving that this is pure 24k gold.  Another thing I have found that Karatbars is doing is building an international infrastructure whereby you will, in the coming months or years, be able to actually make purchases with your small bars of gold from Karatbars (and only Karatbars) right at retail outlets like grocery stores, dry goods stores and other places without having to turn your gold back into cash first.  These retail outlets will not accept any other gold as payment because only the Karatbar carries the certifications that its weight and purity are audited.  This will preserve its "market retail" value and save you from getting a "shave" when using it to make purchases.  For this reason alone I would not buy any other gold from anyone because when the bottom drops out of the dollar this will be the only gold readily accepted for goods and services because you will be able to prove its value and purity.  I would like to recommend right now that this is not the time to be turning your gold in or using it to buy anything.  When the global currency markets do go through an adjustment, and they will, the more gold you have on hand the more wealth you will preserve.  So save save save in gold!

In summary I will again say that the person who made the initial complaint is the equivalent of a carpet cleaner telling you how the heart surgeon is performing surgeries incorrectly.  I highly recommend that anyone who has doubt about pricing in the gold market first do a lot of homework and really learn about the metals market and how prices are arrived at.

Short of that you should be able to feel comfortable with the independent attorney’s report in this rebuttal and forget all about "spot" pricing.  "Spot" has no meaning for consumes and you can't buy gold at spot anyway.  Hope this helps.

If you believe the complaint is valid, you do not understand the market place or capitalism! Feel free to buy your gold where ever you like. There are thousands of outlets for gold and silver. Karatbars doesn't claim to be the only supplier. Please keep a few things in mind: When we bought my wife's Toyota we went to 3 dealers. The price was different at all of them for the exact same car. We bought the car where we knew we would get the best service even though it was a few hundred dollars higher. It was true of the washer and dryer we bought. Several had different names, but they all had the same features and looks. Those prices varied immensely. Even shopping for groceries: over time I have found the 4 stores I have to shop because one has great deals on vegetables, another on supplements and others have various prices based on our monthly needs. Thus, we shop for groceries at 4 stores!   KaratBars has been very ethical in all of our dealings. I know exactly what I am getting. If I want a special theme on my card containing the gold, they will do it for me. Their gold is guaranteed .99999 Currency grade gold. It is verified by the London Bullion Market Association: From Wikipedia, the free encyclopedia "The London Bullion Market is a wholesale over-the-counter market for the trading of gold and silver. Trading is conducted amongst members of the London Bullion Market Association (LBMA), loosely overseen by the Bank of England. Most of the members are major international banks or bullion dealers and refiners. "The physical characteristics of gold and silver bars used in settlement in market is described by the Good Delivery specification which is a set of rules issued by the LBMA. It also puts forth requirements for listing on the LBMA Good Delivery List of approved refineries." So feel free to buy your gold where you want to, but keep in mind not all dealers sell .9999 Currency Grade gold, and give you the personalized service of KaratBars. THE Main Reason I love this company is that They Pay Commissions if you help a friend get into acquiring gold. While the other companies might also be ethical, they do not pay commissions. To my knowledge they do not personalize your gold holding card and give you the excellent service of KBI! So, the various price points are not unusual. However, the excellent service and ability to pay commissions accounts for a slightly higher price from Karatbars.