Yes, you can now get gold from an airport vending machine.
Things you can buy from an airport vending machine: cans of soft drinks, chocolate bars, toothbrushes, gold. Gold?
That's right, gold. Last week a prototype vending machine, complete with armour plating and security cameras, was installed at Frankfurt Airport in Germany, dispensing much-needed gold to the weary traveler.
500 gold machines
The machine, the first of 500 planned for Germany, Austria and Switzerland, sells gold in weights of 1g, 5g and 10g, as well as a variety of gold coins. Prices are updated frequently, in line with fluctuations in the spot price.
But if you're planning to stock up on gold before fleeing the country, to start a new life in Paraguay under an assumed name, this is really not the best way to do it. While the machine accepts cash or plastic, the company is careful to comply with money laundering regulations, and limits the amount sold to any individual.
What about the price?
And there's also the question of price. The owners claim to sell these small-denomination pieces more cheaply than the banks, but they are still at a steep premium to the spot gold price. As the company says very clearly, this is not gold for investment purposes, but gold as a gift -- it even comes in little presentation boxes.
But even though this is just a fun purchase, not an investment, the fact that they're doing does raise an important question for investors: Is this a sign of a peak in gold prices? People are talking about gold, buying it at the airport, and even having gold parties -- organised like Tupperware parties, but where you bring along your jewelry to be valued and sold. All of which smells a lot like a peak in consumer interest, and possibly, therefore, a peak in long-term prices.
Having said that, the sale of a few bracelets is pretty trivial in comparison to the actions of central banks and speculators. Weakness in recent weeks is driven in part by fears that the IMF will dump tonnes of the stuff on the market.
For and against
Arguments for and against the yellow metal have been thrashed out here already.
I stated my case for owning some back in January, while Malcolm Wheatley has recently put the opposing view. In last week's Money Talk podcast, David Kuo interviewed Adrian Ash from BullionVault, who, unsurprisingly, advocates allocating a percentage of your portfolio to gold.
If you're going to invest in it, don't buy it out of a machine; this article from last autumn spells out your options.
The author owns gold.
