Podcast

Adam Taggart/PeakProsperity.com

A New Way to Hold Gold

Right alongside the bills in your wallet
Saturday, January 18, 2014, 1:31 PM

What if you could carry and exchange gold in the exact same manner as you do with the dollar bills in your wallet?

I've recently been introduced to a technology that's making this possible.

In today's podcast, I speak with Adam Trexler, President of Valaurum, about this technology and the gold-infused notes it creates. Valaurum's mission is to democratize ownership of gold by converting it into a form affordable to anyone.

Democratizing Gold

In short, a fractional gram's worth of gold is affixed to layers of polyester, creating a note called an "Aurum" similar in dimension and thickness to a U.S. dollar bill. This gold (usually 1/10th or 1/20th of a gram) is commercially recoverable. So an Aurum offers similar potential as a coin or bar, in terms of providing a vehicle for storing and exchanging known, dependable increments of precious metals just in much smaller (and more affordable) amounts than commercially available to date.

The big idea here? In a world where a 1oz coin of gold costs over $1,200, an Aurum will let you hold a few dollars' worth of gold in a single note. If you've got pocket change, you can be a precious metals owner.

And you don't have to change your behavior. You can store and transport an Aurum in your billfold along with your dollars.

Understanding the Aurum

As the saying goes, a picture's worth a thousand words. Here's a picture of an Aurum designed for Peak Prosperity that the Valaurum team produced for us:

(click here to purchase - PP.com will NOT receive a fee if you do)

You'll see that with even just 1/20th of a gram of gold involved, it's enough to make the Aurum appear to be "made of" gold. The characteristic luster, color, and shine of the 24-karat gold used is immediately apparent.

The Aurum is designed to be handled in the same manner as we do with our "paper" money. And, despite having a more 'plastic' feel to it (resulting from the polyester backing), it's as flexible, lightweight, and familiar-feeling as paper currency.

The big difference, of course, is that instead of being a claim on something else, it simply is what it is: a fractional gram of gold. It can be stored, traded, or melted down just like a coin or bar.

Here's a brief video that gives an overview of the production process:

Implications

Being able to hold gold in this form is significant for several reasons. 

First, it makes gold ownership available to all budgets. Many of the world's households have been priced out of gold to date. This changes that completely.

Second, it enables the potential for everyday transactions should we ever return to a precious metal-backed monetary standard. It answers the challenge: How will you pay for your groceries with gold? With an Aurum, it's now easy.

Whether Valaurum's product emerges as the winning horse or not, the world definitely needs this type of solution (i.e., convenient fractional physical metal) to go mainstream. 

I'm very excited by this new innovation in the bullion industry, and I explore the matter in depth in this podcast. If you're similarly intrigued, it's worth the listen.

And for those of you interested in owning an Aurum of your own, you can learn how to purchase the Peak Prosperity Aurum pictured above by clicking here (Peak Prosperity does NOT receive a fee on these sales).

Click the play button below to listen to my interview with Adam Trexler (36m:59s):

Transcript: 

Adam Taggart: Hello, and welcome to the Resilient Life podcast. Resilient Life is part of PeakProperity.com, and it is where we focus on practical and actionable knowledge for building a better future. I am your host, Adam Taggart, and today’s guest is Adam Trexler. Adam Trexler is the president of Valaurum, which is a very interesting company that Chris and I have come across.

One of the very common criticisms, I guess you could say, that we will oftentimes encounter with people when we talk about the wisdom of owning precious metals, particularly in physical form, is, Well, hey, if you are ever at a point where we are using precious metals to actually make real purchases in the world, you are not going to bring down your one-ounce gold coin to buy a loaf of bread. How practical actually is returning to some sort of metals-backed standard really going to be?

Well, this company, Valaurum, that Adam has helped found and is running, has built a product that could potentially be an excellent solution for that use-case. What Valaurum does is it has a proprietary technology that applies a certain amount of precious metals – I think right now their majority product is a gold-backed one or a gold-based one – and it injects that gold directly onto a surface; they can put it pretty much on any surface, but right now it is doing it in note form. So it is a product that looks very much, in terms of dimensions, like the dollar bills that you would put in your wallet, but it actually has a certain percentage of a gram of gold actually injected into the product. And it is enough gold that you can actually very clearly see that this product has gold on it or in it. So it is your opportunity and ability to basically transact or share fractional grams of gold with other people.

We will have some images of what Valaurum’s product, it is called the Aurum, looks like, that will accompany this podcast, so you see visually what we are talking about. But I wanted to talk with Adam about the product, about the mission behind the company, why he has decided to create this technology, what his vision for the future is. And how people that are interested in potentially owning some physical precious metal in this format, where they can go to learn more about it, and if they want to actually buy some for themselves, how they can do that as well.

So I would like to welcome Adam to the program. Adam, thank you so much for joining me today.

Adam Trexler: Thanks for having me, Adam.

Adam Taggart: You are very welcome. I know we are going to get a little confusing, I think, with the Adams here, but hopefully our audience can follow along.

Well, first, Adam, I want to give thanks to a mutual friend of ours, a Peak Prosperity reader, who brought Valaurum to our attention. I believe he might be on your board of advisors, and I am sure this person is listening and knows who he is. But I had not been familiar with your product until he made the recommendation. And since you and I have been talking and I have actually gotten the opportunity to hold some Aurums in my hot little hands, I have really become a big fan of the product. And then you and I met when you were out here in Northern California a few months ago, meeting with your production team. We got to talk a little bit more in detail about the company, and I have really found it very intriguing, so I wanted to bring this to the attention of the Peak Prosperity audience.

And I think probably the easiest way to start here is just at the beginning. What is the mission behind the company? Why was it created?

Adam Trexler: Well, Aurum was actually invented, I should say, by a husband-and-wife team, Paul and Laurie, and all credit to them for having the vision that you could have a gold instrument of this size, of a sub-gram size. I came across the technology and thought it was just the most fascinating thing that you could have $2, $4, $6 worth of gold embedded in a form that was far easier to use. And what I saw pretty quickly, when I began to think about this, was that this made gold investment available to all people, and also made gold easier to hold in the physical form than anything else on the market.

And I thought this was a product that people in the U.S. would want, people in the developed world would want, but also where the gold market has been going is in Asia in the developing markets. That is where we see the largest demand for gold. And as gold has gone up from $300 – there was a high there a couple years back, but still, at $1200, $1300 an ounce, people just cannot afford to own gold, and cannot afford to own gold in the increments that are available. And this product makes that possible.

So I believe in gold ownership. I believe in precious metals. I believe in physical assets and an investment relationship to the real world. And I saw that this was something that was truly novel and had the opportunity to be huge, and I wanted to serve that vision.

Adam Taggart: Great. So it really sounds like the democratization of the ownership of precious metals, particularly gold, was a driving force here. And we will get into the Aurum itself in just a moment, but the samples that I have held, one had a 10th of a gram of gold in it and one had a 20th of a gram of gold.

Adam Trexler: Right.

Adam Taggart: And I am not going to embarrass myself by doing the math on the fly here at current prices. But basically, to your point, it is a couple of dollars’ worth of gold that is applied there to the note. So you are taking an option that is probably not affordable for most people, if they are considering buying an ounce of gold, and you are giving them the ability with fractional grams to really take pocket change and actually convert that into precious metals, should they want to.

Adam Trexler: That is right. And one thing that really hooked me when I was first researching this project was, I was traveling in Costa Rica looking at some artisanal gold mines. I got very interested in where gold comes from. And I talked to a gentleman who had had a gold production facility. He made rings, and he had a wonderful business, where all men in Costa Rica had to have gold rings. And it was a way for them to hold tradable, physical wealth.

And what happened is, the rings just became too expensive. Nobody could afford them anymore, and they moved to a more consumerist model of holding wealth. People wanted cheap cars, and suddenly nobody had gold anymore. And there was a transfer away from that, which I think is really significant. And this idea of democratizing gold ownership as gold goes up, as the world recognizes that we need these kinds of hard assets, to me seems really important, a critical issue for our time.

Adam Taggart: Yeah, and one of the things I love about what the technology enables – and I do not know if this is the vision of the company, so do not make me ascribe a motive here to you – but as I have reflected on the product, now that I have actually held samples of it, is, were we ever to move back to a precious metal backing to a currency or our currency, you can have what we had back in the early 1900s, where you have a paper note that is a claim on a certain amount of precious metal, and that you can take your paper note down to the central bank and exchange it for some amount of actual, physical metal. What I love about Valaurum’s technology is, you remove a step there. You actually inject the metal in the note itself, so the note does not need to be brought anywhere to be exchanged. It actually is the amount of precious metals that it says it is. It is one of the things I love about with the promise of the technology here. I do not know if your plans are as grandiose as to have it be used for a national currency somewhere, but I suppose the technology or one like it could do that. Is that correct?

Adam Trexler: That is correct. And it is worth saying that we have anti-counterfeiting features built into it. If a government was ever to adopt it as tender, that would be very interesting. My interest in the technology is that it really puts the gold into the hands of people, and there is not that counterparty risk. So when you see gold held in a vault, promises of gold, these kinds of things, that is wonderful. And it makes a lot of sense for certain kinds of transactions. But I think that people should also seriously consider that they might want to actually, physically hold their metal, and this is a means to do that.

Adam Taggart: And as Peak Prosperity listeners know, Chris and I have been longtime advocates of the precious metals. We have also been longtime advocates of holding a material portion of that, at least, physically. This is just yet another way to do that.

So let us use this to segue into a description of what exactly an Aurum is. And again, just not to lose people here, we have talked about the company itself, which is called Valaurum, and the product they have, which is the note with precious metal actually injected into it, that is called an Aurum. On your website, Adam, for the product, you list a couple of benefits here. I am just going to quickly read them, and then I am going to give you floor to talk about the product in any way you think is meaningful for listeners to know about it.

Adam Trexler: Sure.

Adam Taggart: You describe these precious-metal-injected notes as safe, easier to verify, and harder to counterfeit than conventional gold coins, bars, or foil. They are convenient. They are thin, lightweight. They easily fit in a wallet or purse, so you do not need to change your behavior at all in terms of how you carry this around.

Adam Trexler: Right.

Adam Taggart: They are divisible. They can be in much smaller quantity than traditional coins or bars – and that is very true; we have been talking about fractional grams here versus ounces. They are durable, protected between layers of strong and transparent polyester film. I will let you talk more about that when you talk about the creation process. You have here “beautiful.” That is a design element here, where just like coins can be works of art, the Valaurum notes have designs on them. And to be honest, I think the design options are probably – you have a substantially greater number of options with Valaurum, because basically if you can design it, you can apply that to the surface here, just like you could with any note.

Adam Trexler: That is right.

Adam Taggart: And you experiment with colors and all sort of different things, and I will let you talk about that. I will also give a little preview that we will be previewing what some of these Valaurum look like in the post along with this podcast.

And lastly, they are affordable. We have talked a bit about this, but you can have them in all sorts of increments. But in particular, very small increments, at least relative to other types of precious metals, so you could literally be holding a couple of dollars of gold in your hand, which is actually pretty hard to do with coins and bars.

So those are the benefits that the company itself has been touting. Let me hand the mic over, here, to you, and tell people, what is an Aurum?

Adam Trexler: Well, it is a funny thing, Adam. It is the sort of thing, and I think you can vouch for this, that the Aurum makes much more sense when you see it in a hand. It is something that does not describe well, but as soon as you see it, you get it. It looks just like a dollar bill or a note from another country. It is plastic on the outside, which is what gives it its strength. There is a polyester layer, and laminated within it is 24-karat pure gold. We are able to print on the polyester layer, in quite high-resolution with color, which means that we can put anything we want on it; there is a customizable element. And in fact, we have begun designing a Peak Prosperity Aurum that has some of your stuff on it. We really like Peak Prosperity.

And basically, you can carry it, hold it, just like you would a dollar bill. You can carry it in your wallet. It is really quite durable, and you can do the same sorts of things with it. It moves well. It travels well. For five hundred years, we have had bars and coins, and not much has changed in that; certainly for several thousand years we have had gold coins. The need for the Aurum really emerges when you start to see gold at $1300 an ounce for long periods of time, $1200 an ounce, certainly over $1000 an ounce.

I actually have a one-gram bar. It is almost impossible to hold on to. The only way they sell it is laminated into a credit card. When you start talking about a 10th of gram, a 20th of a gram, it is very, very difficult, almost impossible to keep track of that sort of thing. Similarly, as I am sure many of your readers do, I have one-ounce silver rounds. They are just not very friendly in the pocket. It is not a handy thing to carry around. You can carry the same worth of gold in your wallet quite easily with an Aurum, and I think that’s the convenience – and, frankly, the beauty. We have had some great designers work on them. We hope to continue in that vein, and we are still learning more about the artistic capacities of this. We actually had Aurum in an art show at one of MoMA’s galleries in New York City. We can print in very high resolution, and because of the way that the gold is layered, it actually creates a unique image on the back which is kind of a negative image. It looks almost like the gold is engraved. And that creates quite a striking effect, as well.

Adam Taggart: I will agree with that. And you mentioned a few minutes ago that we have actually created an Aurum for Peak Prosperity. I really like how it looks. And we will have a picture of that, as I mentioned earlier, on the post accompanying this podcast, so people can see it for themselves.

One of the things that is striking about the Aurum is that it makes me think when you go and visit some of these churches and domed structures around the world where they have gold leaf on the dome, and you find out that it takes actually a surprisingly small amount of gold to be hammered into that incredibly thin gold leaf that then gets applied to these structures. But even in that incredibly thin leafing, it is still very bright and very obvious that it is gold. Even though we have a fractional gram on these Aurum notes here, it is certainly enough to coat the entire surface of the bill here such that the whole thing looks like it is made out of gold. So it is very bright; it is very striking to the eye. And I have shown it to a number of people, and I have shown it to a number of people in the gold and silver space. I mean, a lot of the people who, I think a lot of folks listening to this podcast actually read their work or purchase bullion from their dealerships. I have had the pleasure of being the first person to hand them an Aurum and see their eyes light up and them hold it up to the light and have a delighted reaction to it.

So anyways, like you said earlier, it is much better seeing the product than actually hearing someone explain it. And like I said, we will have some pictures on the site, so in this case, I am sure the pictures will be worth thousands of our words here.

Adam Trexler: I would like to pick up, Adam, on something you said comparing it to gold leaf. One of the fascinating things about gold is that it is one of the most malleable materials that we have. It can be drawn into very, very long wire, and it can be hammered into gold leaf. And when people see this, one common thing for people to think is, Oh, well, what is so different about this? There has been gold leaf for, again, thousands of years.

Well, the way that gold leaf is made is that basically people – largely in India, often families, it is kind of a cottage industry – will take a piece of gold, and with a leather mallet, hammer it repeatedly until it gets thinner and thinner and thinner. And there are two problems with that. The first, for our purposes, it works wonderful for art, but it is very delicate, for obvious reasons. And more importantly, at an atomic level, it is not regular at all. It is really wavy, as you would expect if you just hammered something. It is thin but not precise.

And what one of the main benefits of the Aurum and the technology underpinning the Aurum – and really the genius of the inventor; I cannot take any credit for it at all – is that we can get within one percent and never below this precise amount of gold and this small increment of gold. So, using an electron microscope, when you look at an Aurum, the atoms are completely flat, whereas it would look like mountains and valleys with gold leaf. And that precision is what makes this a value instrument that is unprecedented for these increments in precious metals.

Adam Taggart: Right; meaning, you can have confidence that it has exactly what it says it has in there, because the control is so fine.

Adam Trexler: Exactly. And developing that control was no small engineering feat, I can tell you. The other thing I would say, and you mentioned this earlier about verifiability, is that the Aurum has a real benefit in terms of, the gold atoms are spread out very thin. So whereas, with bars, we have heard about scandals with tungsten in the middle of them. With coins, of course, people have been counterfeiting this for centuries by gold-plating other metals. It is much more difficult to do this with an Aurum; the fact that the gold is on such a small surface, the fact that the equipment to make it is far more expensive and very difficult to develop. Anti-counterfeiting features, we have it built in. And for the thinner Aurum, you can actually see through the gold with a strong light. And gold, unlike most other metals, has a precise turquoise/aqua/blue-green color when you look through it. Even most gold experts do not know this, but if you look through a 1/20th gram Aurum, you will see this blue-green color, and it is actually the color of gold as the light passes through it. And that is another anti-counterfeiting feature.

Adam Taggart: Great, and so, to say this in other words, one of the ways in which you can assay or at least quickly check to see if an Aurum, indeed, is gold or not, is, you can shine a light through it.

Adam Trexler: Correct. With the 1/20th. The 1/10th starts to get thick enough that it is difficult to do that, and we have other anti-counterfeiting features. But that word “assay” is very important to us. We assay every batch.

The gold is actually quite easy to recover from an Aurum. If you melt off the plastic and pull out the impurities related from the plastic, you get a very small gold pellet. And we assay every single batch to make sure – we have other checks, but – to make sure that every Aurum that is sent out is a precise amount of gold for our customers. We live and die on that.

Adam Taggart: Great, and that is where I wanted to go next, which is, I think, one of the first questions that arises when somebody has this is in their hand is, How do I know this is real gold? And if I ever want to recover the gold, how is that done? So speak just a little bit more about the process of, let’s just say somebody is holding on to a bunch of Aurums, whether it is an individual, but maybe let us think about the gold dealer. Let’s just say you have decided to actually start accepting Aurums, and at some point, you have got a big stack of them. And you want to recover the gold itself. How would you go about doing that?

Adam Trexler: Well, it is a very simple process. We use a fire assay in our lab, really for every batch. And what we do is we put it into a crucible; we use some borax to pull out the material from the plastic that is residual, and then you have a weighable pellet. It is very common in the gold industry to recover gold from substrates of various kinds; we can provide a list of that.

But there is something else to emphasize, which is that people say, Can I melt this down? Yes, you absolutely can. The gold is absolutely recoverable. It is not lost in any way. We have to do this ourselves. We have to recover the gold because we have overspray when we manufacture these, so we do this quite regularly. But what is important to emphasize as well is that gold in this form is more valuable than a lump of gold. And this is the same as coins and bars. A U.S. tenth of an ounce coin is much more valuable per increment than a kilo bar would be. So you actually lose money by melting them down. And there is a clear economic argument for that. Gold in this form is more useable, it is more precise, it is more easily tradable than gold in a huge lump. So we think there is real value in maintaining the Aurum in this form, and we would want to encourage dealers and individuals to trade for it on that basis.

Adam Taggart: Great, so let us talk about that, then. I had never heard about the Aurum before we were introduced, and of course, I think it is really innovative and interesting. And it or a product like it should be in the solution set of ways to hold physical gold. What type of traction are you seeing right now among the important opinion leaders, participants that are going to help determine whether or not this product – or, again, a product like it – will potentially go mainstream? Are you seeing bullion dealers react positively to it? Are consumers able to find it and start buying? Just where are we in the adoption cycle here?

Adam Trexler: Sure. It is a very exciting time for Valaurum. We are really starting to get huge traction with bullion dealers throughout North America. We are talking to one currently about having the U.S. exclusive distribution rights for a year or two. I cannot announce that as of today yet, but that is looking very exciting. We are setting up Canadian dealers, and it is just a very exciting time.

Sorry, Adam; there was another piece to your question. I want to make sure I answer it.

Adam Taggart: I really just wanted to know what type of reception are you getting so far in introducing it into the ecosystem. Are you getting positive reactions? Sounds like you are, from some of the initial dealers that you have talked to. And what do you see as the key milestones for getting this from something we are telling people about for the first time to something that is hopefully a little bit more mainstream?

Adam Trexler: Sure. I think that it will become mainstream, and it is just a process. The dealers that we see are very, very excited about this. They see that it makes gold available. I have shown it to a dozen industry gold leaders – people who comment on gold, people that your readers would be very familiar with – and I would say that two-thirds of them see it, and their jaw drops, and they say, Oh, my gosh, this makes gold usable in a way that it just has not been. And they are thrilled about it. The other third – and I am willing to admit this – the other third doesn’t get it, and the reason they do not get it is because they say, Hey, what is the problem? All my readers can buy kilo bars. I say to them, I believe that this is the personal computer of gold. There was a time when people thought, Oh, nobody will really need a computer. We have mainframe. Big businesses will need them, but why would you need a computer in the home? I think this is very similar. This makes gold available to all people. And we will see a widespread push to own gold in this form, and we will also see, at some point, a push in terms of the demand for gold as a result as well. That is my real vision for this company.

Adam Taggart: Okay, great. And let us flash forward five, ten years. Hopefully you have hit your strategic objectives for this product. If one of our listeners were to go buy an Aurum in the future, is your hope that this would be something that, they would walk into their typical coin dealer and it would just be there amongst the options right next to the coins and the bars?

Adam Trexler: I think that is right, and one of the reasons we’ve wanted to grow a dealer network is precisely so there is a buy-and-sell market, and that is the first objective. But I think in the longer term, if the Aurum is accessible enough, you will start to see it in other spaces. I would love to see it in financial exchanges. So when you go to the airport, and you are going to England, and you would say, I would like some British pounds or euros, that you would also be able to change that into gold. And I think that could happen at banks as well.

So in the longer term, I think that this will become a means by which you can buy and sell gold just as easily as you buy and sell the paper currency of other countries.

Adam Taggart: Interesting, great. Well, it would be interesting to see if India lets you in, in that scenario. They still have their gold controls in place; hopefully they won’t. So it is also worth noting as with gold coins and bars, that, as you said earlier, the smaller the increment, the higher its economic value, because it is more tradable, etc., but there is also more work involved to breaking a kilo bar up into a bunch of 1/10th of an ounce gold coins. So the premiums per smaller unit are higher in the precious metal space. And I am assuming, too, the technology is still relatively new. And the scale is not where you will be, hopefully, in five or ten years, at least given your goals. So we should probably be very clear about – if people are buying an Aurum – that there is a premium involved in it, and it is going to be a higher premium than you would have if you bought a one-ounce coin, and that is because it is a much smaller fragment.

Do you want to just elaborate a little bit on the percentage of the premium in the current product, where you think that is going to go, just so people have an eyes-wide-open understanding of, when they are buying a Valaurum, what the economics are?

Adam Trexler: Sure. This is a little bit tricky to answer because we generally do not sell direct to the public, so it’s really up to dealers to price this product. And we do not have a set RRP; we let dealers make their decision about what they think the market will bear. Typically what we are seeing is roughly in the double spot area. If you draw an economic curve of what gold should cost as different increments, this seems roughly in line with the curve that you see from kilo bars down to ounce coins, down to sub-ounce coins, and then down to the Aurum. It is very simple – and our readers and your readers, I am sure, are familiar with this – it is not special to precious metals. It is the same reason you can go to Costco and buy a case of detergent much cheaper than if you go to 7- Eleven and buy a one-use set of tabs. My argument would be that you might want the convenience of the Aurum in addition to holding the majority of your gold in ounces or bars.

Adam Taggart: Right, right. Yeah, and I think right now, because you are so early in the adoption curve, most uses I have seen of the Aurum have been almost more sort of, it is more of a collectible, it is more of a fun way for a company to brand itself and whatnot. But as a consumer who actually is looking at this and saying, I am actually willing to pay a premium to have precious metals in this format at this point in time, just for the insurance factor if we ever got to a point where I needed to give somebody a little slice of gold to do something for me, this is a fantastic medium for that. And as you said, there is an economic curve at which the smaller you go, the higher the premium will go anyways. And as I mentioned earlier – if you can comment on this, it would be great – I am sure you have got a cost of production right now that is also going into that premium that will decrease over time if your business grows and you get greater economies of scale. Is that true?

Adam Trexler: That is absolutely true. This is a high-tech nanotechnology, and doing a couple thousand for Peak Prosperity is not the cheap way to manufacture this. But as we grow, we have clear projections and a pretty clear schedule that shows that the price goes radically down.

Adam Taggart: Great, well, hopefully those dealership relationships that you mentioned you have been getting traction with, as those begin to grown and order volumes begin to increase, you begin to hit those economies of scale. So let us transition quickly to talking about the Peak Prosperity Aurum, because we do have one designed. I think it is very pretty; of course, I am an incredibly biased source. But we will have an image of it here, and people can take a look for themselves.

If you are listening to this and looking at the Peak Prosperity Aurum and thinking that might be a fun thing to own, we are going to have a link there, Adam, that is going to plug into Valaurum’s commerce system, and people will actually be able to buy these. Is that correct?

Adam Trexler: That is correct, yes. And you can go ahead and order them from our site, and we will deliver.

Adam Taggart: All right. Well, fantastic. And I assume over time, if Valaurum gains the traction that it hopes it will, and I hope you guys do, they will start seeing other designs with other providers out there in the world as more people decide that having an Aurum of their own makes strategic sense for them – or is just good art and pleasing to the eye.

Adam Trexler: That is right, and I think it is both those things. I think that your readers will hopefully think, Oh, I would like to see one of those and just see what this is about. And then may think, as I do, that If I am going to hold several ounces of gold, I might want to have an ounce worth in an Aurum, or two ounces worth or some percentage of their precious metal ownership.

Adam Taggart: Yep, that is definitely the approach I am taking. So let us see here, Adam, as we begin to wrap up here, you just happen to live and breathe the precious metal space, given this product, so I would be remiss not to ask you if you are seeing any trends or if you have any market intelligence that our readers who are reading other precious metal sites right now may not have already gotten exposure to in terms of your insider viewpoint, your perspective, or whatnot. Basically this is the Where do you see precious metals going from here? question.

Adam Trexler: Sure. I think that the underlying drivers of precious metals are only going up. I think that there will continue to be global risk. I think there will continue to be global debt problems, and we have seen why people want to own that. But I think the larger trends is the growth of wealth in Asia and other developing countries, where people have historically, for hundreds and hundreds of years, owned gold as a way to hedge their wealth. And the demand trends are very clear. The demand for physical gold has continued to grow even as the price has gone down.

And one thing that I look at that most other commentators may not is I look very, very carefully at the demands numbers for jewelry because there is a sector that is buying coins and bars, and you see that quite often in the United States – people who want to invest, invest in coins and bars. In other countries – I mentioned that ring manufacturer. The way that people invest in other countries is they buy jewelry. And it is typically a lower-increment investment, and that is the overlap with the Aurum. And what you see is that as the price of gold has fallen, that number has surged, both in the U.S. and abroad. And what it says to me is that as gold becomes more affordable, more people jump in and want it. And what I think that represents is a huge pent-up demand for gold, and people not being able to afford the increments that have been on the market.

So I think that the future of gold is very bright. I think that we have an increasing population, a limited supply of gold in the entire world. I don’t see that going anywhere except up over the medium term. And I think as more people have access to gold, have access to incremental wealth that lets them want to stick a bit of money away in this form, it can only go up.

Adam Taggart: All right. Well, I cannot say any of that disagrees with my perspective or that of Chris, so I think we do see the world very similarly to you. And as we see and embrace that trend of more people wanting to own gold more widely, which means having it be available to people at price-entry points that they can afford, it is really wonderful to see innovation and new products like the Aurum on the marketplace. So we wish you all the best.

And, Adam, I know I am going to get a ton of questions after this podcast about the actual process for manufacturing and Aurum and the technology that is involved. And I had intended to get into that, but we just did not have the time for it. I know we have a short video clip that you created that I’ll post along with this write up on the site. But I can definitely see myself inviting you back in the not-too-distant future to talk maybe a little bit more nuts-and-bolts about how the product is actually made.

Adam Trexler: Oh, that would be great, Adam. I have really enjoyed my time, and thanks for having me on.

Adam Taggart: Oh, really, my pleasure. Well, great talking with you, Adam, and best of luck with all your goals for world dominance with the Aurum here.

Adam Trexler: Well, it is really about dominance of the world and recognizing that the physical wealth that we can all have a part in, we should all have access to, and the Aurum is just a piece of that.

Adam Taggart: Very well said. All right, look forward to talking to you again soon, Adam.

Adam Trexler: Thank you.

Related content

44 Comments

steve from virginia's picture
steve from virginia
Status: Member (Offline)
Joined: Apr 23 2012
Posts: 4
gold 'money'

Add a few more zeros to the 1/20th of a gram note over a short enough period you have hyperinflation.

See how that works? "So simple," as John Kenneth Galbraith once said, "The mind recoils."

Cornelius999's picture
Cornelius999
Status: Bronze Member (Offline)
Joined: Oct 17 2008
Posts: 64
Wow! But too high tech for

Wow!

But too high tech for social collapse situation where assaying small amounts may be too difficult. Also too counterfitable I think.

Cornelius999

kevinoman0221's picture
kevinoman0221
Status: Silver Member (Offline)
Joined: Sep 25 2008
Posts: 125
I'm in

Oliveoilguy's picture
Oliveoilguy
Status: Gold Member (Offline)
Joined: Jun 29 2012
Posts: 403
Brilliant idea ...

This is what capitalism is all about. Kudos to Dr. Trexler.

I understand that Bernanke has found the technology to imbed recoverable debt into the new dollar bill. When the bills are burned or destroyed the debt will still be there.

AkGrannyWGrit's picture
AkGrannyWGrit
Status: Silver Member (Offline)
Joined: Feb 6 2011
Posts: 167
Shipping

How quickly can I get a few?  It would be a delightful surprise to send some out for Valentines day.

AK Granny

rhelwig's picture
rhelwig
Status: Member (Offline)
Joined: Sep 5 2010
Posts: 5
Glad there's some competition

Shire Silver has been doing something similar for years now. Shire Silver cards are laminated credit card sized cards that have the silver or gold embedded in the plastic. You can easily recover the metal by burning the plastic and paper with a cigarette lighter.

We've had 1/20th gram gold cards for a couple years now, and sell them for $4 (discount for paying with bitcoin).

I also saw a presentation about 3 years ago where someone wanted to use gold leaf embedded in the plastic notes like more modern countries use.

https://shiresilver.com for those interested in the original wallet friendly bullion. We already have a couple other folks using our idea, milligold.org in India and bluffssilver.com in Iowa. A couple more are in the works, making variants that are local currency with global value.

Sterling Cornaby's picture
Sterling Cornaby
Status: Bronze Member (Offline)
Joined: Sep 6 2012
Posts: 62
Double Fascinating

For me, this intersects two of my worlds; thin-film technology and ideas at peak prosperity. I see a sputtering system (controlled with LabView), and a very expensive sputter target, servicing a need of sound money! I use a silver 1oz coin daily to calibrate my XRF equipment; my head is spinning on anti-counterfeiting measures, which does not seem to hard at all, film thickness measurements etc. I would happily volunteer my skills and resources to this cause, I will not disappoint. Just send me a message if you are interested in talking more. Sterling

Rwrek's picture
Rwrek
Status: Member (Offline)
Joined: Feb 9 2012
Posts: 18
Brilliant and Creative

I hope this catches on and have ordered some but just wonder what our overzealous regulators will have to say if it does.

Will be delighted to see them lose control of their manipulated prices.

SingleSpeak's picture
SingleSpeak
Status: Gold Member (Offline)
Joined: Dec 1 2008
Posts: 430
Mind Blown

The future slowly coming into focus.

SS

Oliveoilguy's picture
Oliveoilguy
Status: Gold Member (Offline)
Joined: Jun 29 2012
Posts: 403
Just bought some

Bought 20 to test the waters.....Premium seems a little steep, but can't wait to touch and feel one.

Price break at 10.

Wildlife Tracker's picture
Wildlife Tracker
Status: Silver Member (Offline)
Joined: Jan 14 2012
Posts: 189
Very interesting

"President Ólafur Ragnar Grímsson of Iceland Presented with Commemorative Aurum
15 April, Washington DC

Today Dr. Trexler met with President Ólafur Ragnar Grímsson, of Iceland, and presented him with two unique, commemorative Aurum. President Grímsson is the fifth President of Iceland, having served since 1996; he was unopposed in 2000, re-elected for a third term in 2004, re-elected unopposed for a fourth term in 2008 and re-elected for a record fifth term in 2012.

Dr. Trexler and President Grímsson met in a private reception at the National Press Club. President Grímsson was in Washington, DC to announce the launch of a new global forum, Arctic Circle, to enable countries beyond the polar region to have a say in determining the future of the far north. The event received international media attention and can be viewed here. Dr. Trexler also attended this press conference.

In the next months, Valaurum, Inc. will explore the production of a commemorative Icelandic note using the technology of the Aurum."

http://valaurum.com/news.html

This would be a nice speculation play if this company was traded publicly. A lot potential here if independent governments introduce this technology into their currency. Looking forward to following this company into the future. Thanks for sharing this with us.

thebrewer's picture
thebrewer
Status: Bronze Member (Offline)
Joined: Nov 7 2012
Posts: 86
Good Idea but...

I think this is a really good idea but the premium is a bit steep to really invest. Perhaps with mass adoption the premium will get more in line with coins. I can't see it taking off otherwise. Counterfeiting would be my other big concern. 

thc0655's picture
thc0655
Status: Platinum Member (Offline)
Joined: Apr 27 2010
Posts: 642
Retail use

If merchants could quickly and cheaply verify the authenticity and weight of the gold content (like cashiers check US currency with a quick swipe of a special pen) this might take off. Otherwise it looks like a novelty.

Wildlife Tracker's picture
Wildlife Tracker
Status: Silver Member (Offline)
Joined: Jan 14 2012
Posts: 189
Re:retail use

They just need a light penetration meter (like a bar code gun) adjusted to the thickness of the aurum and you could verify its authenticity. I have no idea how cheaply they could be produced, but you just need one at each register. This could revolutionize trade or just be overpriced gold. It could go either way as you stated.

pat the rat's picture
pat the rat
Status: Bronze Member (Offline)
Joined: Nov 1 2011
Posts: 29
aurum

Will there be a  link on your web site to stay ,or is this a one time deal 

trexleradam's picture
trexleradam
Status: Member (Offline)
Joined: Oct 8 2013
Posts: 2
counterfeiting gold

Thanks for all the interest in the Aurum everyone. I'm grateful to Peak Prosperity for letting me come on.

True, counterfeiting has been a problem with almost all physical means of holding value. Coins and bars are very susceptible to this: the tools to cast a coin or bar aren't hard to get ahold of, and tungsten is a lot cheaper than gold. And I'm sure we all remember the scandals when color printers became commercially available, with dollars being xeroxed on mass scale. 

But the Aurum incorporates a number of anti-counterfeiting features that fiat notes and coins/bars don't have. Every Aurum has a reverse image that looks like an engraving. This comes from the process where gold is 'sprayed' on. It won't occur with gold leaf, and it takes very expensive machinery to get this effect. You're not going to get there with a color copier. Every Aurum has a serial number, as well. 1/20g Aurum can be looked through and you will see a unique turquoise color from gold (the heavier PP Aurum don't do this). Reproducing the luster of gold at this thickness with another material is also difficult. Microprinting adds another level of complexity for would-be counterfeiters. There's more detailed information regarding authentification on the valaurum.com website for those that are curious. 

We have some other exciting related features we're working on as well, and will share those here when publicly announced.

trexleradam's picture
trexleradam
Status: Member (Offline)
Joined: Oct 8 2013
Posts: 2
Spot price and premiums

Oliveoilguy wrote:

Premium seems a little steep, but can't wait to touch and feel one.

This is a question we often get. There is a real difference between buying an Aurum and a kilo bar, or even an ounce coin. In larger increments of bullion, an investor should be looking to get as close to the spot price as possible. But as the increment decreases, there's a higher markup over the commodity price. Putting gold into this form isn't cheap. The machine costs are enormous. It's a proprietary process that has taken years and quite a bit of funding to perfect. But we think there's a real market need and that the Aurum is priced about right for this increment of gold.  

The economic forces here aren't special to precious metals: I can go to my supermarket and buy a 20 pound bag of rice for $20 or pay $5 for single serving bags. But it's also important to look past the commodity pricing.

The Aurum is convenient and precise. You can use it for many things where an ounce coin won't do. Also, many people can readily afford it who can't buy an ounce. Gold has a higher utility in this form, and it becomes less useful if you melt it and return it to a lump. And so less valuable as well. We think the trade in value for the Aurum will stay above the spot price for this reason. 

I'd never advocate someone holding all their precious metal in Aurum. But if you have multiple ounces of gold, you might think about having an ounce or two in quantities that are easier to use. And if you've been waiting for a way to own gold, this might be what you're looking for. 

davefairtex's picture
davefairtex
Status: Diamond Member (Offline)
Joined: Sep 3 2008
Posts: 1421
the baseball card effect

So it occurs to me that it is possible, if these things get popular, the scarcity/collectible value of a limited run bill might be surprisingly high 20-30 years from now.  Paying 2x over spot might be...how shall I say it...like buying BTC at $5.

I'm not usually one to promote hype or anything, but if the valaurum guys are exceptionally clever, they'll come up with a way to explicitly differentiate different runs of bills, like Magic the Gathering did with their print runs of cards, in addition to committing to limiting that print run to a particular size.  That way, you can tell the first run VA/PP bills (of which there were, maybe 2k issued) from the second run of VA/PP bills (of which there might be, perhaps, 100k issued).

Likewise, there is always the issue of seigniorage; "The net revenue a government receives from printing money; the difference between the face value of coins and notes and the cost of producing and distributing them.."

Think about how much a USD $10 bill is actually worth vs how much the government gets for one.  Now of course there is one small difference - universal acceptability.  "Legal for all debts public and private."  But if Armstrong is right, and there is a crisis of faith in public institutions coming down the pike, this thing might just be the leading edge of a wave of private money issuance.

Back in the day, a silver dime was often worth less than the melt value of the coin.  So was the copper penny.  Now of course, that's not the case.

Just some thoughts on a Monday morning.

* Not affiliated with the company in any way.  I may sound like a shill for them - or for PP - but I'm not!  I'm just thinking out loud.  And wondering how many I should get - just for fun, of course.

bronsuchecki's picture
bronsuchecki
Status: Bronze Member (Offline)
Joined: Apr 22 2012
Posts: 51
Scaling

The premium is a killer for me. I am gathering from the video the process is somewhat slow - does this scale up. For example, if you wanted to make 20 million notes (only 1 tonne of gold which is not much re worldwide demand for coins), how long would it take and would the premium come down to something more acceptable?

nimsdf's picture
nimsdf
Status: Member (Offline)
Joined: May 7 2010
Posts: 6
Constitution

This is a cool idea. But how do you address the Constitution, Article 1, Section 8.5; which reserves to the Congress of the US the only authority to "Coin Money"? (Aside from the fact that at any number of time in this country this provision of the Constitution has been ignored.)

thatchmo's picture
thatchmo
Status: Gold Member (Offline)
Joined: Dec 14 2008
Posts: 266
"Where'd that Bennie go?" 

"Where'd that Bennie go?"  I'd sometimes ask myself on Sunday morning, late, staring into my empty wallet, back in the day.....A hunnert bucks ain't what it used to be....

So, "this looks like fun" I tell myself without even listening to the podcast or watching the vid.  Sign me up for a dozen.  Opportunity cost: 2 oz. of AG.  I've done worse.....Aloha, Steve.

robie robinson's picture
robie robinson
Status: Platinum Member (Offline)
Joined: Aug 25 2009
Posts: 659
Will accept

for payment on our farm for vegetables, grain, dairy, and meat, the Aurum, esp. if its a first run and leaving the hands of one PP'r to another. robie

jimmyvi's picture
jimmyvi
Status: Member (Offline)
Joined: Jan 20 2014
Posts: 1
Great idea.

What a great idea! We have often thought about buying gold, or silver, but whenever we find that we have to purchase a lot more than we can afford. Today's market does leave the normal household out, but this may just be the way in.

 
 
The amount of time that you spend playing blackjack at online pokies cincy is going to teach you all the ins and outs of gambling and just might win a lot of money.
Ejh237's picture
Ejh237
Status: Member (Offline)
Joined: Oct 16 2011
Posts: 11
Order Placed

10 on the way.  :-)

rhelwig's picture
rhelwig
Status: Member (Offline)
Joined: Sep 5 2010
Posts: 5
Constitution's limitations

The Constitution does limit the states' ability to do things like this, but it leaves it open to non-governmental entities. To be more specific, only the federal government can create "coins", but that doesn't stop people from making 'rounds' or notes or whatever. It basically creates a special category for those tokens created by the U.S. Mint.

jgritter's picture
jgritter
Status: Silver Member (Offline)
Joined: Dec 13 2011
Posts: 163
Junk silver

I'm not sure why junk silver coins don't already fill the bill.

John G

robie robinson's picture
robie robinson
Status: Platinum Member (Offline)
Joined: Aug 25 2009
Posts: 659
junk silver?

maybe cuz they they don't make'em any more.

Bankers Slave's picture
Bankers Slave
Status: Silver Member (Offline)
Joined: Jul 26 2012
Posts: 235
There are

10 on their way to the UK.

Oliveoilguy's picture
Oliveoilguy
Status: Gold Member (Offline)
Joined: Jun 29 2012
Posts: 403
CAUTION....Something is suspicious

I just had paypal contact me regarding my transaction with Valaurum. They are investigating the vendor and asked me if I had received delivery. I have not. It has been 5 business days and there is no shipping info posted yet....and when I call Valaurum there is no actual phone contact. All numbers roll over to a fax tone.

I have emailed them for an update, but no response yet. 

Adam.....do you have any follow up info on this company?

Adam Taggart's picture
Adam Taggart
Status: Peak Prosperity Co-founder (Offline)
Joined: May 26 2009
Posts: 1883
Sure OOG

You can call me and I'll get the answers you need from Valaurum's president (Adam Trexler, the fellow I interviewed)

I'll PM you my phone number.

I know the reason why they haven't shipped yet, if that helps. The batch for this PP version, which is custom, is still being set up to run. I'll get an answer from the company on when they plan to start shipping them out.

A

farco's picture
farco
Status: Member (Offline)
Joined: Jan 24 2014
Posts: 1
Thanks

Thank for the info.
I also bought 10, 4 days ago, without any more news since.

Adam Taggart's picture
Adam Taggart
Status: Peak Prosperity Co-founder (Offline)
Joined: May 26 2009
Posts: 1883
Update

Mark -

I just spoke with Valaurum. The reason you didn't receive an email back is because the email address you provided them with contained a typo (I verified this myself).

I've given them the correct email address, so you should hear from them shortly.

Here's what I learned as for timing: the PP batch (which is a custom run being made based on the order volume from the past week) is being run next week and shipment will start on Monday Feb 3.

If you have any other questions you'd like help with, just call me on the phone number I PM'd you earlier.

cheers,
A

Oliveoilguy's picture
Oliveoilguy
Status: Gold Member (Offline)
Joined: Jun 29 2012
Posts: 403
Thanks Adam

Everything looks on the up and up. Glad to hear of the shipping date. 

Got an email from Adam Trexler explaining things.

Thanks again

jcusick's picture
jcusick
Status: Member (Offline)
Joined: Apr 25 2011
Posts: 1
Stiff Premium

A nice idea but the exchange rate needs to come down a tad. The one offered here is $10.00 and if I'm reading it correctly it contains 1/10 of a gram. At $100.00 per gram that's a pretty stiff premium today when you consider that you can buy a 20 gram bar from Kitco and others for around $860.00 to $900.00.

I'm not trying to be negative. I think it's an excellent idea, and I know the initial costs to get this off the ground are probably not cheap, and the portability factor has some good value, but as others above have mentioned it is still more of a novelty item than anything else.  As an investment or means of exchange it is very expensive.

Oliveoilguy's picture
Oliveoilguy
Status: Gold Member (Offline)
Joined: Jun 29 2012
Posts: 403
Shipping date set

Just got confirmation from Adam Trexler that the first batch of PP  Aurum will be ready to ship on Feb 3.

Can't wait......

Oliveoilguy's picture
Oliveoilguy
Status: Gold Member (Offline)
Joined: Jun 29 2012
Posts: 403
A Way to Personally Leverage Your Gold

Giving Silver or Gold as a tip is a great way to leverage your Precious Metals. 

Here's a quick story. I had a delivery of metal for my greenhouse which weighed about 8000 lbs. and came on a 54' flatbed tractor trailer. There was a 40' I-Beam and 4x4 x 24' tubing and angle iron and more. And I had to get it up to my building site or it would have cost me an extra 1/2 days work and been a real pain to reload and move on my 20' trailer.  So I got the driver to come up our curvy drive and turn around and back in where I could off load with a forklift on my 40 hp tractor. The driver was awesome, he did all he could to make it go smoothly, and I knew this was his most difficult drop of the day. When we got done I decided to tip him and thought I'd give him a $20.00 bill but then decided to give him a one ounce Silver Round. 

He lit up like a kid getting a new toy. He asked me some questions about what it was. I explained the obvious stuff like spot price and purity. He said he'd never seen anything it before and thanked me profusely. 

So what were the positives of this transaction?

1. I made a much greater impact on this man than I would have with US dollars of equal value.          

2. There was some education and real discussion of precious metals, and I guarantee that he has passed this info on to his wife and kids.                                                                                            

3. I put some silver "in circulation" and I will replace it next time I order a couple of rolls of rounds.       

4. I have a friend now who might even look forward to delivering onto my ranch again.

Clearly much leverage above the $20.00 value of the ounce.

I see the same possibilities with the PP Aurum note. 

thatchmo's picture
thatchmo
Status: Gold Member (Offline)
Joined: Dec 14 2008
Posts: 266
VERY cool action!  I'll

VERY cool action!  I'll remember that.  And, for the reasons you mentioned, I hope others will, too.  After all, if it is not making a positive impact on your world, what value is it?   Aloha, Steve.

GoatMan's picture
GoatMan
Status: Member (Online)
Joined: Jul 24 2010
Posts: 8
Aurum arrived!

It's a real eye catcher! It shines like you know gold should. I'm sure it's going to be a real conversation piece.

thatchmo's picture
thatchmo
Status: Gold Member (Offline)
Joined: Dec 14 2008
Posts: 266
Good lookin' cash

Got mine today.  Yeah, shiny, got it's own serial #.  Interestingly, only 1/10th of a gram, spread out over the size of about a dollar, and you still can't see any light through it.  Sticking it in my wallet to check for durability.  Maybe give it away to a deserving soul.  I might get some more... Aloha, Steve

Oliveoilguy's picture
Oliveoilguy
Status: Gold Member (Offline)
Joined: Jun 29 2012
Posts: 403
Great Gift Idea

Got mine yesterday as well. And gave some away already. A client with a "prepper" mentality gave me a great bonus last year, so this was a way to give them something in return. They really appreciated the uniqueness of the valaurum.  

And they look cool. One is going in my wallet also. They seem kind of stiff and I'm curious to see how they perform.

rhelwig's picture
rhelwig
Status: Member (Offline)
Joined: Sep 5 2010
Posts: 5
High tech yes, counterfeitable no

I have a few of these now, and while it does require some high tech equipment to produce, it does seem like they would be very hard to counterfeit. I basically have no concern about fakes.

RobertBeri's picture
RobertBeri
Status: Member (Offline)
Joined: Aug 11 2008
Posts: 1
Fear of not receiving order

I got my order about 2-3 weeks after ordering. But in the interval Valaurum emailed me to say that they were bogged down with orders and there would be a delay.

Robert

Bankers Slave's picture
Bankers Slave
Status: Silver Member (Offline)
Joined: Jul 26 2012
Posts: 235
I have received

my order of 10 here in the UK. No import duty implications for a change.

Very impressed with the product. Heres hoping that it gets universal approval.

LynnFogwell's picture
LynnFogwell
Status: Member (Offline)
Joined: Apr 15 2013
Posts: 3
Am I the only one

... that is still waiting on my Aurum order? I ordered back in January when this article came out. Are people still receiving them? 

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Login or Register to post comments