The words "gold bullion" conjure up visions of pirate ships and treasure chests overflowing with antique gold coins, or stacks of gold bars piled high in a bank vault.
Today, the word bullion refers to gold coins and bars minted after the Gold Confiscation of 1933. You may already be familiar with some of the more well known bullion coins such as the American Eagle, the Canadian Maple Leaf, the Chinese Panda, the South African Krugerrand, and the Austrian Philharmonic, as well as the names of some of the best known minters of gold bars such as Credit Suisse, Johnson Matthey, and Pamp Suisse. These easily recognized coins and bars allow collectors and institutions to move in and out of gold bullion easily and swiftly, which is important in bullion transactions. Bullion's value relies solely on its weight in gold (or silver) and fluctuates with the market, so the timing of your buying and selling is also very important if you are dealing in bullion with the hopes of appreciating your capital.
Unlike Pre-1933 gold coins which offer many advantages including privacy, long-term stable growth, downward resistance, and exemption from confiscation and reporting, bullion's disadvantages include its short term and sometimes violent fluctuations, lack of privacy, reportability, and ability to be confiscated by a mere signature of the President on an Executive Order, at whatever rate the government deems "just compensation".
What is important to remember about bullion is that it cannot be purchased at exactly the spot price, and yet it relies on the spot price as its basis for value. Bullion can, however, be purchased more closely to the spot price of gold than any of the other types of gold. It is considered by some as the best gold recommendation for an investment term shorter than 3 years or for a smaller starting position. Bullion coins are available in various denominations and bars in varying weights from ounces and grams to pounds and kilos. The smaller denominations also make gifts in bullion affordable.