If it sounds too good to be true…
Ok, I’ll admit it; I despise deceptive advertising. I don’t know when this abhorrence first appeared, but perhaps it comes from the time I ordered x-ray glasses from the back of a comic book when I was 6, or from my attempt to build a hovercraft using an old lawnmower and the plans I purchased from an ad in Popular Science. Either way my frustration with misleading advertisements is deeply embedded, which brings me to my latest rant.
There’s currently a commercial airing on television touting the virtues of the American Buffalo 24-karat gold coin. The ad reads, “The $50 Gold Buffalo Coin is the purest gold coin ever made in America. It was the first one ever struck using .9999 pure 24-karat gold. Its design was based on the famous Buffalo nickel minted from 1913 to 1938. Wildly popular with investors and collectors, production stopped because of a shortage of specially made gold blanks. Now, you can reserve your own copy of the $50 Buffalo Gold Coin as a Tribute Proof clad in 14 mg of pure gold.” The commercial then goes on to say, “The final issue price was to be set at $50 per proof. But, during our special release, this 24 karat pure gold clad masterpiece can be yours for only $9.95. With gold skyrocketing past $1,500 an ounce, price can only be guaranteed for 7 days. Limit 5 per order.”
It’s a deal so good they have to limit the number you can buy, really? First off, this is not the 1 ounce gold coin being produced and sold by the U.S. Mint; it is a copy and therefore not legal tender. Secondly, this coin is clad in 14 mg of pure gold. Hence, it’s plated with .000450 troy ounces of gold. With gold currently priced around $1,600 per ounce, each one of these coins contains less than 73 cents worth of gold. Knowing that, you would have to purchase 2,223 of these coins in order to have one troy ounce of gold, and at $9.95 each, this equates to $22,110 per ounce. Compare this to the $1,650 price of the genuine coin and it doesn’t seem like such a good deal after all.