eBay Gold and Silver Sales Booming; Buyers Beware
You probably think of eBay as a good place to snag a deal on electronic gadgets, musical instruments, or sporting goods. But increasingly people are logging onto the auction site to buy gold and silver.
EBay officials told CNBC the company is touting its global user base of 150 million people to reach non-traditional buyers. With so many people entering the market for precious metals, buyers should beware. The strong demand creates a breeding ground for scammers. In fact, eBay is apparently using the demand for gold and silver bullion to peddle collectibles.
EBay is leveraging increasing interest in precious metals on its platform this holiday season. The company is marketing branded coins as the perfect stocking stuffers, an alternative to the traditional lump of coal. The company is offering deals on DC Comics’ Superman, Disney’s Snow White coins created by Royal Canadian Mint and a LucasFilm Star Wars coin from ModernCoinMart.”
As Peter Schiff points out in his special report Classic Gold Scams: How to Avoid Getting Ripped Off, many of these “collectibles” range from being major ripoffs to virtually worthless. For instance, the 1-ounce silver Star Wars collectible coin on eBay is priced at $129. That’s more than an 800% markup over the current spot price for silver.
According to a CNBC report, the sale of gold and silver bullion on eBay has surged over the last several months. On Thanksgiving, the online marketplace sold about one gold bar every minute, generating just under $1 million in sales.
EBay’s gross merchandise volume for bullion has spiked 60% from last year, and 27% from October, with about a quarter of sales on mobile devices.”
Silver is also a hot commodity on eBay. The site did a brisk business on American Silver Eagles bullion coins Thanksgiving as well.
Its sellers sold the silver weight equivalent of twenty-five fifteen pound turkeys on turkey day. Last weekend in just one day, it sold 2,500 rolls of 20 Silver American Eagles…That translates to more than $850,000 in gross merchandise volume and sales of 50 ounces of silver every 60 seconds.”
The sale of gold and silver bullion on eBay reflects generally strong demand for physical precious metals. Earlier this month, the World Gold Council reported global gold demand in Q3 increased 8% year-on-year. Investor demand was a major factor in the increase, surging 27%, primarily on the strength of gold bar and gold coin purchases. In the US, bar and coin demand hit the highest total in five years. American Gold Eagle coin sales are at the highest level since the financial crisis.
Just because a lot of people are shopping at eBay doesn’t mean it’s the wisest choice. Stick with a dealer you know you can trust. If you see a lower price, call us and find out if we can match or beat it.
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