(Money Metals News Service) We get lots of questions from the public about precious metals. Some people are curious about the basics.
Others are skeptical about the case for owning gold and silver. Still, others are longtime customers who have highly specialized inquiries.
Here we will answer a few of the most common, most broadly relevant questions we get…
QUESTION: What makes silver so unusual and special?
ANSWER: Silver is often called “the poor man’s gold.” Like gold, it’s a precious metal with deep cultural and monetary roots—but it’s far more affordable per ounce, making it accessible to the average person.
That’s especially true in periods like this. When gold takes off to the upside, many investors shift toward silver because they can get so many more ounces for the same dollar amount. And because the silver market is much smaller than gold’s, even a modest rotation of new money from gold into silver can have an outsized impact on silver’s price.
With both monetary and industrial features, silver has been described as schizophrenic.
But each of its personalities is highly charming! Its monetary qualities are time-tested for millennia, and in many languages, the word for silver literally means money.
On the industrial side, the uses of silver are exploding, thanks to its status as the best reflector of visible light, the most conductive metal for electricity and heat, and its remarkable effectiveness as a natural biocide.
That combination makes silver one of the most useful metals on earth. And with silver still historically inexpensive relative to gold, it’s a compelling value play. The price action of the past six months suggests that the market is realizing just how dynamic – and vital silver is.
QUESTION: What is the best government mint?
ANSWER: Money Metals sells coins from numerous government mints, but it really comes down to a matter of personal preference for the investor.
However, if you want more precious metals for your money, you will certainly want to avoid all U.S. Mint products, as mismanagement by federal government bureaucrats has distorted the market, causing high premiums and wide spreads on all current U.S. Mint products.
Most other sovereign mints produce high-quality coins, too, but they do so much more efficiently.
However, private mints are where the action really is… and more experienced investors migrate to privately minted bars and rounds, which carry much lower premiums and lower buy/sell spreads.
QUESTION: If I set up a precious metals IRA, will I have to sell when taking distributions?
ANSWER: You have two options. You can sell some of your IRA precious metals holdings and take distributions in cash. Or you can take physical possession of your bullion and account for its value as an IRA distribution.
According to IRS rules, when an individual takes personal possession of physical precious metals that were held inside an IRA, it counts as a distribution. Even if you don’t sell the bullion for cash, you could still face tax consequences based on its market value.
