Josh Saul, CEO of The Pure Gold Company, recently spoke live on CNBC, discussing the influence of geopolitical tensions on gold investment and emphasizing the unique advantages of holding physical gold over other forms of investment.
Gold as a Safe Haven
Gold has long been considered a ‘safe haven’ asset during uncertain times. However, Saul highlighted that the true value of gold depends on how it is held. For those focused on long-term wealth preservation, physical gold offers distinct advantages.
“Physical gold appeals to individuals seeking security and stability,” Saul explained. “It provides a tangible store of wealth, along with significant tax benefits.”
Tax Benefits and Regional Variations
For U.K. investors, investment-grade gold coins such as Britannias and Sovereigns—produced by the Royal Mint—are particularly attractive. These coins are exempt from Capital Gains Tax, allowing U.K. residents to retain the full benefits of any price appreciation.
By contrast, in the U.S., gold is classified as a collectible. Long-term capital gains on collectibles are taxed at a maximum rate of 28%, which is higher than standard long-term capital gains tax rates.
The treatment of gold also varies across parts of Europe.
“Amid geopolitical uncertainty, including ongoing Brexit implications, many clients are moving their funds out of Germany, France, and Italy and into gold, whether they live in the U.K. or abroad,” Saul noted.
A Hedge Against Modern Risks
Physical gold is increasingly viewed as a hedge against economic instability, unpredictable monetary policies, and the growing threat of cyber-attacks. While electronic gold investments, such as Exchange Traded Commodities (ETCs), may offer convenience and liquidity for short-term investors, Saul emphasized the enduring value of tangible reserves.
“For short-term investors, ETCs can be a cost-effective way to gain exposure to gold,” Saul acknowledged. “However, for long-term protection, physical gold remains unmatched.”
A Historical Perspective
Germany’s recent decision to repatriate 743 tons of gold, valued at approximately $31 billion, underscores the enduring importance of physical reserves. The gold, previously stored in New York and Paris, was returned to Frankfurt as part of a strategy to ensure greater domestic control over the country’s wealth.
“Germany’s actions highlight the significance of holding tangible assets,” Saul said. “Physical gold provides a reliable store of wealth that paper money, subject to manipulation and devaluation, cannot replicate.”
The Future of Gold Investment
As geopolitical and economic risks persist, The Pure Gold Company remains committed to helping clients secure their wealth through physical gold. Its unique benefits make it a timeless choice for those seeking long-term financial stability.