American retailer and warehousing giant Costco is currently experiencing a major gold run after it began offering gold bars for sale at discounted prices. Costco recently added gold bars from PAMP Suisse and Rand Refinery to its list of discounted products, limiting purchases to only two per member.
Prices for the gold bars vary depending on the location, with Costco listing the gold bars at around $1,985.20 per ounce in Canada and $1,979 in the United States. In spite of the relatively high prices and limits on purchases, Costco reports that the gold bars are flying off the shelves. During a recent earnings call with investors, Costco CFO Richard Galanti said the retailer usually loads the gold bars on-site, and they typically sell out within a few hours.
According to the retailer’s website, Costco members in the U.S. can buy a one-ounce bar of gold from PAMP Suisse for $1,979 or a one-ounce Rand Refinery 24-karat gold bar for $1,949.99. Both types of gold are currently rated at 4.9 on Costco’s website and cannot be returned or refunded. The gold bars are only available to customers online, and Costco’s website also stresses that the gold is not eligible for any promotions or price adjustments.
Gold has always attracted plenty of interest during uncertain times because it retains its value during economic downturns, allowing investors to retain the value of their cash even as fiat currencies such as the dollar lose value. However, individuals buying up Costco’s gold likely won’t be able to buy enough of the precious metal to use it as a profitable investment vehicle due to the purchase limits placed by Costco.
Membership fees would also eat into any potential gains Costco members would make on the gold purchases, reducing the precious metal’s potential as an avenue for profit.
Some Reddit users said they were unable to obtain the high-demand gold while others noted that buyers with executive membership cards could earn 2% cash back after buying the Costco gold.
Genesis Gold Group cofounder Jonathan Rose says that even though the gold may present a viable profitable avenue for buyers, it acts as an effective promotion for Costco and appeals to a specific segment of the retailer’s customer base. Rose also stated that Costco seems to be building up its available stock of survivalist foods as the cost of living rises and Americans become more uncertain of the future.
This gold bar sale being conducted by Costco is likely to spur interest in the public to invest in gold, and gold extraction enterprises such as Eloro Resources Ltd. (TSX: ELO) (OTCQX: ELRRF) could see a spike in interest in their stock.
NOTE TO INVESTORS: The latest news and updates relating to Eloro Resources Ltd. (TSX: ELO) (OTCQX: ELRRF) are available in the company’s newsroom at http://ibn.fm/ELRRF
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