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Right Now Is The Time To Buy Physical Gold - CEO

 (Kitco News) - There is no denying gold is viewed as a safe-haven asset; the metal recently rallied on heightened uncertainty in the marketplace.

And, to one executive in the gold space, investors should look to get their hands on physical gold right now.

“Physical gold is motivated by people who want long-term protection, long term safety and security. They want to remove counterparty risk,” Josh Saul, CEO of London-based gold dealer The Pure Gold Company, said in a CNBC interview Friday.

“It’s really the uncertainty that drives gold demand [and] it’s not necessarily things that are going to look good or bad, it’s about not knowing, unpredictability.”

Gold prices have surged recently on growing geopolitical uncertainty. The lack of confidence in the Trump administration alongside tensions between the U.S. and North Korea helped push the metal to multi-month highs this summer. Spot gold last traded up $5.20 at $1,291 an ounce. 

Saul said his clients prefer physical gold over electronic gold because they prefer to have a tangible asset that is not subject to risks of cyber-attacks.

“The benefits of having physical gold is that you have a physical store of wealth,” he said.

Spot gold prices are up about 13% year to date, while Comex gold futures prices are up roughly 12.5% over the same time frame.

But Saul added there is an additional benefit to owning physical gold.

“There are also various tax advantages available to people that purchase certain types of physical gold that you wouldn’t get if you were purchasing electronic gold,” he said.

Capital gains tax on some physical gold coin in the U.K. are not subject to tax. The coins include the U.K. Royal Mint’s Brittanias and Sovereigns, CNBC reported. However, the same does not apply in the U.S. because gold is subject to a capital gains tax.

Saul argued that investors should also look to own physical gold just like central banks do.

“We take our lead from the central banks. Germany already brought back 50k bars from France,” he said, referring to the Bundesbank recent repatriation of gold from vaults in the U.S. and France.

“I believe there is a reliance on them [Bundesbank] having some sort of a physical, tangible store of wealth rather than relying on paper money that can be manipulated, created and devalued over time,” he added.

Earlier in the week, the German central bank announced that it had successfully returned 674 tons of gold from the Federal Reserve in New York and the Banque de France in Paris.

By Sarah Benali

For Kitco News


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