On June 25, 2010, an article in the Wall Street Journal noted: Individual investors are increasingly demanding to take possession of their gold holdings, rather than just owning shares in a mining company or a gold-related fund.

What the Wall Street Journal failed to report is the possibility that many gold investors may not, in fact, actually have the gold or silver they purchased and believe to be safely stored in a bank vault.

Gold and silver investors are discovering that banks possess only a small fraction of the gold and silver allegedly bought by banks for customers.

Banks, unknown to their customers, use a fractional reserve system for their accounting of gold and silver inventories. Only a small percentage of gold and silver bought by customers is actually held and stored by banks.

Banks for years have been charging their customers for precious metal purchases without actually buying the metals, booking the precious metal “purchases” as bank liabilities, not as the custodial accounts customers assumed.

Fool me once, shame on you.
Fool me twice, shame on me.

You’ve been warned.

Buy gold, buy silver, have faith.

Darryl Robert Schoon

The exception is Swiss banks. Their custodial accounts holding gold are not subject to the "fractional reserve system" employed on this side of the Atlantic and make them probably the safest method of gold storage on the globe!

Silver, a visit to Switzerland to open a "custodial account" to store your gold (Also purchased from said Swiss bank) may be your best strategy for ownership of the metal!

RUF