Precious Metals

PNG reports physical gold buyers returning

Bullion dealers are reporting increased buying activity from customers amid rising precious metals prices and depressed stock performance.

Images courtesy of SilverTowne.

Intermittent spikes in the spot price of gold have triggered the return of buyers of physical gold who have been sitting on the sidelines in recent weeks.

Members of the Professional Numismatists Guild’s Accredited Precious Metals Dealers and others are reporting the return of long-time buyers and inquiries from new investors.

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“In recent weeks we have seen an increase in customers interested in buying bullion gold coins,” says Jeff Garrett, president of Mid-American Rare Coin Galleries in Lexington, Kentucky, and immediate past president of the American Numismatic Association. “Most express concerns with the rising budget deficit as the primary reason for buying. I believe the recent pull back of the stock market has others considering alternative investments. Sales of rare coins has also been on the increase, and our biggest problem is finding new merchandise at current price levels.”

PNG President Barry Stuppler says dealers are experiencing increased bullion activitiy with the rising gold price.

“In addition to the U.S. American Eagle and Canadian Maple Leaf bullion coins, some common date, century-old U.S. gold coins are selling now for just a small fraction above their precious metal content,” Stuppler said. “The same is true for some late 19th and early 20th century U.S. silver coins. There’s an opportunity now to acquire these kinds of coins at a low premium over their melt value.

“Many of the dealers I’ve talked to believe that inflation will be coming back by June 2019 and that will drive more gold and silver buyers.”

Mike Fuljenz from Universal Coin and Bullion in Beaumont, Texas, says activity in silver bullion is also up.

“My silver sales to new and existing customers were up dramatically in September much like the U.S. Mint’s silver Eagle sales for that month,” says Fuljenz. “They remain strong. Driving forces for this rise include stock market volatility, global economic and political uncertainty and concerns about the Democrats regaining a majority in the House of Representatives and all the repercussions that could bring. Our gold sales have remained about the same as we have derived new customers. New customers have increased due to increased silver Eagle response from ads.”

PNG Vice President Richard Weaver from Delaware Valley Rare Coins in Broomall, Pennsylvania, says, “We actually started seeing interest when gold was in the $1,180 to $1,200 [per troy ounce] range with the return of long-time buyers.” Weaver said, “We are seeing some new faces, but they’re not making large quantity purchases.”

PNG Past President Dana Samuelson from American Gold Exchange Inc. in Austin, Texas, believes the increased activity is the result of drops in stock prices. 

“While precious metals are firming up from their June/July skid to 2018 lows, the strong declines in stocks have been a bigger driver of public buying of gold in my opinion,” Samuelson said. “Investors are clearly taking some stock profits as Wall Street volatility increased and they’re moving some of those profits to safer or more opportune areas, including gold and silver.”

Former PNG President Gary Adkins from Garry Adkins Associates Inc. in Minneapolis called bullion activity “a mixed bag with less buyers than sellers taking advantage of the higher gold price to liquidate.”

“Until we see higher interest rates, that will be the case,” Adkins said.

Diane P. Rapanotti from The Roamin Roman Inc. in Kingston, Washington, says her customers’ outlook for gold boils down to political party affiliation.

“My liberals don’t think the economy, as it is, can be sustained and metals will go up,” she said. “My conservatives think we are in a great economy and it can be sustained through the Trump term. Thus, metals will go down.”

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