Yesterday, I wrote to you about the Perth Mint gold scandal.
The story broke out while I was in Australia for boots-on-the-ground research.
So I started investigating the heart of the issue right away.
I visited the Perth Mint, and I asked officials if the rumors had impacted gold sales. They assured me that the Mint is on track to sell even more gold than last year.
But here’s what I discovered. Whether or not you agree with the rumors, the Perth Mint scandal puts gold in the spotlight.
And that spotlight couldn’t come at a better time given our current market environment.
So today, I’ll look beyond the story and headlines to discuss why the scandal shouldn’t stop you from buying gold. After all, gold is a great protector of wealth… and your best hedge against inflation.
And most importantly, I’ll explain the in-and-outs of buying physical gold bullion, like the different forms it comes in and the places where you can find the best deals.
But first, I’ll dive into one more reason the Perth Mint controversy is still ongoing…
Tracing the Perth Mint Scandal Back to a Previous Incident
A few weeks after the scandal broke, Perth Mint chairman Sam Walsh said that the “historical issues” regarding the quality of the Perth Mint’s gold are being fixed.
He was referring to an incident that occurred in October 2021.
Back then, the Shanghai Gold Exchange (SGE) told the Mint that it received 1-kilogram gold bars containing too much silver relative to gold. This did not meet the SGE’s non-gold specifications.
And as it turned out, that accusation proved to be true.
The Perth Mint apologized to the SGE right after it was notified.
But the problem was that, as Walsh admitted, the Mint didn’t inform the Australian government about the issue, or its resolution, until January 2022. Three months later.
That overhang of a breach of trust could be why the Perth Mint and West Australian government are still facing calls for a further investigation into these matters.
Now, there will likely be ongoing controversy about the Perth Mint’s gold and processes.
And you may hear more about a royal investigation commission into the matter because of the government’s relationship to the mint.
But that shouldn’t stop you from buying gold.
As I explained yesterday, gold is a great hedge against financial uncertainty. More specifically, gold is a protector of wealth against the Fed’s reckless money printing.
During economic crises, like we saw recently with the U.S. banking crisis, the Fed will save the banks. When push comes to shove, the Fed will print more money, no matter what that does to inflation.
And as long as the Fed is set on manufacturing money to lift Wall Street and the banks, then investors must consider safe haven assets to protect their wealth.
Gold is a centuries-old safe haven asset.
And holding physical gold bullion is a great strategy for gold investing. It allows you to see, touch, and feel your investment, in a way that owning a share of a mining company, digital gold, or even an exchange-traded fund (ETF) doesn’t afford you directly.
And if you take anything away from the Perth Mint headlines, it’s that you always want to do your research before you buy physical gold.
With that, let me give you some of my top tips…
A Guide for Finding Real Gold
First, the most important thing you can do when buying physical gold is checking if it’s authenticated by official sources.
You don’t want to buy gold only to discover it isn’t worth as much as you thought.
So I recommend buying pure gold coins from mints. That’s because mints usually provide an authenticated statement validating the purity of that gold.
The U.S. Mint, for example, provides a Certificate of Authenticity (COA) with most of its coins.
These COAs can differ from mint to mint, but they usually include a seal of some sort. In the case of the U.S. Mint, this can be an official U.S. Treasury seal and/or the United States Mint seal.
But you don’t even have to go to a mint to buy their coins. You can buy coins online and get them mailed to you with an authentication slip.
You can also purchase physical gold through online dealers.
Two of the larger, more well-known online dealers are APMEX or JM Bullion.
And that brings me to the different forms of gold you can buy, and where you can get them from…
The Two Main Forms of Gold, and Where to Buy Them
There are two main forms of physical gold: coins and bars. Both vary in size.
The size of gold bars can range from 1 gram to 1 kilogram.
Coins, on the other hand, tend to be smaller. You can find ones that have decorative meaning. They’re also easy to store at home.
As for the price, coins can be slightly more expensive than gold bars. That’s because their mining costs tend to be higher.
Gold bars are usually priced closer to the gold spot price, with a smaller amount added for minting costs.
You can also buy physical gold from a local dealer or collector.
But be careful with your purchase. Before you buy any gold, make sure you’re aware of the gold’s spot price – or the price per ounce of gold in the market.
That way, you’ll know you’re getting a fair price.
Now, there are also two main risks to keep in mind when buying physical gold.
First, you’ll need a safe place for it. Second, you’ll need some time to sell the gold for a fair price.
That’s why buying gold ETFs or gold mining company shares can be another way to gain exposure to the market. Shares in these vehicles can be bought and sold quickly through your regular brokerage account.
If you want to go that route, consider an ETF that holds physical gold. The SPDR Gold Shares ETF (GLD), is the one that holds the largest amount of physical gold.
(Side note: Many of you have written in with concerns about GLD in the past few days. I’ll answer your questions in tomorrow’s Friday mailbag edition, so be sure to look out for that.)
What I Bought at the Perth Mint
As regular readers know, coins make excellent gifts and investments. They can commemorate a time, place, or special interest.
They also act as wealth accumulation investments. And single coins easily fit into a suitcase!
As I promised yesterday, I’ll tell you what I got at the Perth Mint…
I bought an authenticated silver coin (pictured below). It’s a wedding gift for two close friends of mine.
Nomi holds a silver coin (left) and a gold coin (right) at the Perth Mint
So the next time you need to buy a gift for an important occasion, or to simply invest in a real asset, make sure to return to the buying guide I provided above.
Regards,
 |
Nomi Prins
Editor, Inside Wall Street with Nomi Prins
P.S. Just yesterday, the price of gold sat over $2,000 per ounce. And in a time of market uncertainty, I believe there is plenty more upside ahead…
That’s why, in my Distortion Report advisory, I recommended a company set to benefit from the gold rally. It mines at one of the lowest costs among its peers. And it’s growing – both organically and through high-profile acquisitions.
As I write, shares are up 13% since my recommendation two weeks ago. But as investors run to safety, I expect shares to trade at least 50% higher before the end of the year.
If you’re a paid-up subscriber, read that issue here. If you’re not paid-up yet but want to protect your portfolio against turmoil, go here to learn more about Distortion Report.