Equity repositioning is the remedy if you have been
scammed into "churning and burning"

Equity repositioning can rescue you from the Churn and burn, which refers to the conversion of mid-grade American numismatic gold coins to expensive, high MS, uncirculated numismatic gold coins.

If you have purchased some American numismatic gold coins in the mid-grades, Very Fine, Extra Fine, or Almost Uncirculated, the kind of gold coins you should have for wealth preservation, beware of companies that try to convert those coins into expensive, high MS numismatic gold coins. The process is called churning (churn and burn). They will tell you that the lightly circulated numismatic gold coins that you have will not be considered collector coins in a possible confiscation – the government will look at them as bullion and confiscate them.

They then tell you that only the high MS coins, which are for collectors and speculators only, will be considered collector items in a confiscation. They will then try to persuade you to convert or reposition those coins into investor coins. Don’t ever do that. The result is churn and burn: you sell legitimate, wealth-preserving gold coins for a lesser weight of more expensive coins without higher value.

One woman in Nebraska had 93 ounces of lightly circulated Extra Fine $20 Liberties. She had the right coins for wealth preservation. Then a very good “Christian company” got a hold of her on the phone and did a good churn and burn. When these vultures were done with her, they had converted her 93 ounces of numismatic gold into 51 ounces of expensive, high MS numismatic gold coins. She lost 42 ounces of gold, which, in an economic crisis, could amount to a tremendous fortune.

If you have been a victim of the churn and burn and have already purchased gold, but were talked into buying the horribly high-priced, high mint state gold coins or bullion gold, you should consider equity repositioning that wealth into semi-numismatic gold coins. The advantages of doing so are immense, and the examples to follow indicate that.

But equity repositioning can also mean a variety of things, and no matter what type of equity you want to reposition, buying and holding physical gold is the only financial security in this world of the falling dollar and plummeting property values. So, if you have sold a house or a piece or property or if you have liquidated stocks or bonds, gold is the only sure, bedrock, safe haven for your wealth, and it is very simple.

A Remedy for the Churn and BurnThe unfortunate victims who were deceived into buying these high mint-state numismatic gold coins for $2,000 to $10,000 per coin, when the dollar fails, will have to break them out of their plastic cases and use them simply for their gold content. In that day, no one is going to even think about buying your expensive numismatic coins for two to three times what you paid for them.

At that point you will know that gold company or that gold broker has done a churn and burn on you, but it will be too late. Ninety-nine percent of the people who buy gold are not collectors. They are just common people who have converted some imaginary money or paper money into real money as a hedge against bad times. In fact, in my 10 years in the coins business I have only run into four or five actual coin collectors.

If you find yourself a victim of a company who has sold you the wrong coins for the wrong reasons in a churn and burn or other scam technique, there is hope for you. For example, if you were talked into buying bullion gold coins, or foreign gold coins, or the real high mint-state numismatic coins, usually MS64 or above, there is a remedy that will ease the pain a little. It is called conversion, because you convert something risky or overvalued into something that will benefit you in the long run.

Here is how it works. In the case of bullion coins, like the American Eagle bullion coin, the South African Kruggerand, the Canadian Maple Leaf or the Austrain Philharmonic, the pain or loss is minimal, depending upon the spot price of gold at which you bought these coins. I simply take the dollar amount for the bullion coins when I buy them back from you and switch that dollar amount into numismatic gold or 90% silver, whichever the client prefers. That way, no money changes hands, and I ship you your numismatic gold coins or the 90% silver coins after doing the conversion, to reverse the churn and burn.

If you have purchased foreign gold coins like the British Sovereigns, French Francs, Swiss Francs, German Marcs, or any other foreign gold coin, the pain of loss is a little greater. Why? Because the coin company who sold you these coins usually charges more premium per coin than if you had bought straight gold bullion coins. And, of course, they always lie and say that these foreign gold coins are private because they were minted prior to 1933.

The purpose of conversion is twofold. First, you want to remove yourself from an area of risk into an area of security. Second, you want to have more ounces of gold and silver than you had before (reverse the churn and burn). Most of the time I like to convert high mint-state numismatic coins into lower grade coins, always gaining total ounces of numismatic gold or silver for my client in the process. Sometimes the benefit of conversion is great, and the numbers are staggering, so don’t despair if you have been a victim of a churn and burn scam.

Churn and burn case study:
As an example, one man bought 700 - MS65 Morgan silver dollars for $56 a piece for a total of $39,200. The broker who sold him these coins claimed that these Morgans were worth over $500 dollars a piece at one point in history, and they were sure to reach that pinnacle again. Each Morgan silver dollar contains 0.77 of an ounce of silver. To do the simple math, 700 coins times 0.77 of an ounce equals 544 ounces of private silver.

Based on the dollar amount of the conversion of these 700 MS65 Morgan silver dollars into numismatic gold coins and 90% silver coins, my client now has a 55-pound bag of Walking Liberty Half Dollars which contains 715 ounces of silver, and 46 one-ounce XF (Extra Fine) $20 Liberties. Now, let’s look down the road a little at the value of these coins when the dollar fails, and gold gets to $2,000 an ounce and silver $50 an ounce.

If he had held on to the 700 - MS65 Morgan silver dollars, he would have had $27,200 of value in his hand, or 544 ounces of silver times $50 per ounce. He would have lost $12,000 from his original investment of $39,200. After the conversion, however, he had 715 ounces of silver at $50 per ounce, or a total value of $35,750. He also had 46 ounces of gold at $2,000 per ounce, or $92,000 worth of value. Totaling the gold and silver together after the conversion, we come up with $127,750. Remember, his initial outlay was $39,200. As I said, sometimes the conversion numbers are staggering. So, if you have bought the wrong coins for the wrong reasons in a churn and burn or other scam, there just may be a happy ending for you.

Going just one step backward. If that man, at the beginning, had taken that original $39,200 and bought XF (Extra Fine) $20 Liberties, he could have purchased 100 ounces of private gold. At $2,000 an ounce gold, his total would have been over $200,000, or over five times his initial purchase. Not bad if you are talking about profit potential.

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