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Portable Precious Metals: The Ultimate Hedge Against Uncertainty

Physical precious metals like gold and silver have always been popular as stores of wealth. Investors big and small have used precious metals as safe havens to protect wealth from market turbulence.

Historically, gold and silver bars that weigh 10 ounces or more have been popular because they fit conveniently in a safe, but recent trends point to more people accumulating portable precious metals like coins and jewelry. Even Gold IRAs backed by precious metals stored in depositories have seen an increase in coins and smaller utility bars instead of bulkier bars.

There are two primary reasons for this recent shift. Mobility is being factored more prominently in recent years as people move from cities to rural areas or from state to state. Even those with multiple homes are wanting to take some or all of their precious metals with them to keep them handy in case of unforeseen circumstances.

Then, there’s the rise of the “prepper” mentality. Once the subject of ridicule as “doomsday preppers,” today’s average preparedness-minded American doesn’t live in a bunker or on a homestead. They’re living in the suburbs or on recently purchased land in rural areas, having left behind cities with rising crime, crowded streets, and skyrocketing costs of living.

The modern “lifestyle prepper” wants precious metals they can carry on them at any given moment. Even as the economy forces people to cut expenses, precious metals in the form of jewelry are still selling well. But jewelry poses two challenges. First, they are sold at a premium, often 500% over the melt value. Second, they can attract the unwanted attention of criminals.

Utility bars are a burgeoning method of carrying wealth. With far lower markup than jewelry and the added benefit of being unseen in pockets or wallets, utility bars such as the Prepper Bar can be broken into smaller pieces to allow for quick liquidation or bartering.

By far the most popular option is coins. They come in a wide variety ranging from rounds that cost a few points over spot price to collectibles and numismatics that are sold at a premium due to the potential upside they carry.

Unfortunately, many Americans are unaware of the value of precious metals coins. A viral video made its rounds a couple of years ago in which a popular podcaster offered random people on a California street their choice of a one ounce gold coin or a $20 bill. Such videos are selective with the examples they show to the public, but it was still surprising to watch dozens of people opt for the cash over the coin.

Ironically, the podcaster was shooting the video while standing in front of a coin shop. He told those who asked that they could sell the coin at the shop behind him for $1800, which was around spot price at the time. Of course, he only told them that after they had opted for the cash.

While anecdotal, it highlights one of the challenges with coins if emergencies arise and bartering becomes necessary. Since most Americans see coins as having little value, it may be difficult to find bartering partners who appreciate the value of the precious metals being held. This is why utility bars and jewelry sales are going up faster than coins.

Concerns about the economy stem from multiple angles. Inflation, interest rates, the border crisis, and rising crime are at the forefront. De-dollarization, Central Bank Digital Currencies, the growth of BRICS, and looming bank closures are in the background.

Then, there’s the upcoming presidential election. Before, during, and after the election, it seems very likely that there will be turmoil across America regardless of who wins. This has been the number one reason many Americans are moving wealth and retirement accounts to physical precious metals.

The rise of portable precious metals may be a fad. But if anxiety continues to rise, we may see portable precious metals become the de facto stores for wealth.

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Joe Messina

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