Friday, October 1, 2010

ATMs That Sell Gold Bars Are Coming Soon to America

By: Reuters
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A German firm that installs and manages gold vending machines aims to introduce them into the United States this year as it expands rapidly to take advantage of demand for bullion in times of economic uncertainty.

Thomas Geissler, creator of the Gold to Go brand and chief executive of Ex Oriente Lux, told Reuters on the sidelines of the London Bullion Market Association conference that the company aims to issue a "couple of hundred" machines next year.

Gold to Go launched its first ATM in Abu Dhabi's Emirates Palace hotel in May. They are now operating in luxury hotels in Abu Dhabi, Bergamo and Madrid as well as around Germany.

"This year we will issue around 35 machines, and for next year we are looking for bigger numbers," Geissler said on Monday, standing in front of one of the ATMS, which was coloured and shaped like a giant gold ingot close to 2 metres tall.

The machines, which update the gold price every 10 minutes to match international markets, take cash or credit cards and dispense small bars—including 1 gram, 5 gram, 10 gram and 1 ounce units—as well as coins such as South African Krugerrands, Australian Kangaroos and the Canadian Maple Leaf.

The company's plans include expansion into the United States this year, first in Florida and then in Las Vegas, Geissler said.

As for major gold consumers India and China, that will have to wait for next year, he said. "We have large interest in these countries," he said. "This is the task for next year."

Gold's rally this year has come largely as a product of investor unease over the economy.

This nervousness has been reflected in high sales of coins and bars from national mints, particularly last year as the world emerged from recession and this year as concerns have persisted about the risks to recovery.

With the gold price near record highs, there is a danger that demand from people on the street for gold products could tail off, however.

"Whether gold drops to $500 or goes to $2,000, we are living from small spreads, and we give people the best price they can get on a minute basis in the machine, so we're pretty fine with any price," Geissler said.

Gold to Go, which obtains the gold bars from refiners in Germany and Switzerland, first tested the machines in 2009.

Spot gold was quoted at $1,297.95 an ounce at 1235 GMT on Monday, up by over 18 percent this year and by over 80 percent since the unfolding of the credit crisis in late 2008.

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