hi i've got jeff clark senior precious metals analyst of goldsilver.com on the line with me for another what the facts section it's f a q s what the jeff how are you doing [Music] i'm doing great mike and that's frequently asked questions for those of you that didn't quite catch that and yes we get those all the time here and we've got another interesting one mike that i i thought we should talk about and that is this when you talk about what you buy you freaking frequently refer to coins


that you buy silver eagles or gold eagles or whatever but it's mostly coins so some people want to know do you buy bars at all is there any advantage to buying bars or what is your balance there how how would you recommend someone's uh you know allocate their portfolio between coins and bars okay yes i buy both coins and bars uh you know i used to have uh quite an array of stuff that i had collected through the years a lot of odds and ends and um you know i i don't the when i moved to puerto rico


there's a uh you know there's tax exemptions here and one of them is called act 22 uh and it's zero capital gain on any investment income and so um uh but in order to make sure that everything qualified when you move to puerto rico under act 22 uh if you've lived in the united sta on the mainland for nine years and you moved to puerto rico and you're here for one year and then you have this big huge gain that all happens in that year even though nothing happened in the previous nine


years and what you were invested in you know it may have just done this and then you move here and in one year it does this the way the irs is going to calculate it is they're going to take whatever your gain was and divide it by uh ten and nine tenths is going to be allocated to standard income tax in the united states one tenth to to the puerto rico in its tax exemption and so basically i had to sell everything that i had that was uh you know all except for a few little odds and ends i sold


my entire position i was out of it for about 35 days and then i was able to buy in i think actually a little bit lower than when i sold which was just a piece of luck but when i bought back in i bought mostly silver eagles i do own a a number of uh 100 ounce silver bars and then on my gold instead of buying gold eagles and on gold i just went with the least expensive gold that i could acquire and that was all bars with uh because i don't see the growth in the premium that the u.s mint charges


the u.s mint charges us a big premium on uh and and every other dealer they've got a price that includes a huge premium over the spot price and that premium has grown with the metals and uh uh it hasn't grown much because you know it was already fairly large on gold but on silver it was fairly small and it's i made gains of i believe more than a dollar uh since i started doing this and you get back that premium when you sell you silver eagles sell for more than uh just uh you know silver ounces


in a bar and the premium ratchets up but it never comes down this is the thing is during a pullback that premium doesn't shrink so if you miss the top you're going to end up capturing some of that premium however the percentage move on the metals is going to far outstrip the premiums so uh bars are a very good investment um the thing about uh silver eagles is it's a us government uh it's a legal tender coin uh it can be used to pay taxes although nobody's going to use it because you have to use it


at face value but the united states government recognizes this as a coin and uh the uh therefore any type of counterfeiting you would have the uh secret service going after you it's a federal crime uh the uh and then there's a tax advantage uh when it comes to reporting but it's not one that really matters that much the taxes the the advantage in reporting is that uh when you sell back to a dealer if you sell more than 1 000 ounces of silver or a bag of silver dimes or quarters or half dollars


those were traded as commodities uh you know on the commodities exchange as futures and uh the irs has a bizarre fascination with anything that was traded and uh you have the dealer has to do 1099 broker reporting on uh these items uh and so there's any amount of uh silver over a certain amount that the dealer has to do broker reporting on but it doesn't really matter because at that point you've already sold it when you buy it there is no reporting on anything the irs the government is not


informed of your position in precious metals it's only after you don't have it anymore that they find out that you had it at one time 1099 broker reporting it's not required on silver and gold eagles and so um it's just a little bit more private but the only reason you would use the one with need or want that privacy is because you're trying to cheat on your taxes and i don't recommend that anybody does that the gains in precious metals are going to be so large that paying the


taxes on it won't hurt that much and they do have an advantage it's not quite the uh advantage that you get with uh the regular it's it's taxed as a collectible and so uh you get a break off of regular income tax it's not as high as regular income tax so uh that's the reason but yes i buy silver eagles and uh 100 ounce silver bars i've got quite a few of those and i also have some of our own products because like our own silver bowl is one of the best ways that you can


you're acquiring one ounce increments of silver and if silver really goes high it's nice having some of these things that are one ounce instead of 100 ounce if it's going really if it goes to uh 500 bucks um i don't want to be say there's 5 000 bucks would be 10 ounce 100 ounce would be 50 000 it sounds insane absurd but you know what if you look at history anything like that is possible if uh gold goes to ten thousand dollars an ounce and if you look at the video that i uh produced recently uh if


uh history just repeats and we have a repeat of the 70s bull market you're talking about eleven thousand two hundred and fifty dollar gold in november of uh uh 2023 uh and uh that would be history repeating i'm not saying that it's going to repeat but if you had that 11 000 you know if you've got 10 000 gold at a 20 to 1 uh gold silver ratio you would have five hundred dollar silver at uh ten to one which is possible but you know ten thousand dollar silver sounds absurd even i mean


thousand dollar silver thousand dollar per ounce silver sounds absurd even to me but the thing is you don't know what's going to happen and in a mad rush when there's a panic and uh investors are seeking safe havens and the big safe haven u.s treasury bonds has become suspect if if people don't trust uh sovereign bonds then you're talking about a russian depo precious metals such as the world has never seen and at that point uh these things of a ten to one gold silver ratio and ten


thousand dollar gold are entirely possible in fact there could these these prices are conservative because you're not talking about the price of gold you're talking about the value of the dollar at that point and those are two different things very good the point being that you definitely want to have exposure uh to this market and make sure you have physical gold and silver so generally speaking the the rule of thumb is that uh bars have lower premiums than coins and the larger the product the lower the


premium uh goes as well so uh coins are a lot prettier to look at than bars and so that's why a lot of people buy them uh so if you're gonna have some at home or some near you at home make sure it's safe store it safely but that would be uh probably nicer to have than than bars bars are actually designed for storage we believe that the shape of the bar uh you know narrower at the top wider at the bottom is made that way for stacking purposes so that's why you'll see a lot of


bars uh maybe not the one ounce but once you get beyond one ounce you'll see bars are made that way so they're designed for storage so if you just want to add ounces and you want to keep it safe and get it out of the house storage is a great option because bars are ideal for that and they're also lower premiums um so yeah i'd like i'd like to say too that uh um with bars you are getting more ounces for your currency and i do really expect the performance of gold and silver to far


exceed these premiums on the coins and so lately what i've been buying when i buy is the hundred ounce silver bars and one ounce gold bars um when uh uh the premium on the silver you know i've already seen uh the premium [Music] go up a very large percentage it's almost up as much as the silver itself since i've been buying but like i say when there's a pullback the premium doesn't pull back it stays there and so uh that's the reason uh but i do think like i said that the metals will actually outperform


the uh gains in the premium so uh now what i'm doing is mostly collecting the there is one other thing though uh when you buy the gold and silver eagles uh when you buy any sovereign coin like that you're probably taking uh those metals away from industry you're taking it off of that industrial market permanently uh when you buy a thousand ounce bar comex bar of silver when you sell that bar it might be industry buying it on the other end so in trying to keep the the price up on gold and silver


i think that buying sovereign coins creates a shortage in industry later it isn't something that's going to re-enter the market that industry is going to pay that premium on and then melt down to make circuit boards and contacts and so on uh so um i that that's another reason that i recommend it uh the the sovereign coins is simply because i think that uh when we get to the top of this bull market that it will help sustain a higher price after we've reached the peak yeah good point so a final point on this


is that you probably want to think about uh selling to determine what you're going to buy so what's going to be easiest to sell so if you have coins and they're sovereign coins meaning a government minted coin they're probably going to be very easy to sell and you may even recoup the premium on those a higher premium uh when we sell if you do that in the kind of price environment that mike sees ahead so uh diversification is probably important too so keep that in mind when you're


deciding between coins and bars and one final point on silver is that uh it does take up a lot of storage space so as you accumulate and get more and more ounces it's probably best to not keep too much of that in the house and actually keep it in storage uh simply because it takes up so much space so yeah you know when it comes to storage uh you mentioned uh making your purchase based on when you you know when you're going to sell and uh 100 ounce bars of silver and silver eagles gold eagles one ounce bars in storage uh


you can lock in the price right away and uh the so it's highly liquid and when the peak comes when everybody is rushing into this um the dealers such as us we it becomes very difficult to source this stuff and so the price you're going to get for the if you pick the proper items you're going to get a higher price back when you go to sell than if you pick the wrong items and so that's a good thing to keep in mind and if it's in storage then the dealers will want to buy that from you right


away and they'll offer you more because uh you know it'll be very difficult to get very difficult to sources that you want to wait for that period of time when gold and silver become unaffordable and not unobtainium and at that point you'll do very very well when you sell it back so picking the right thing is important and those are the items i pick yeah that's great that's great input mike so uh thanks very much for that uh input there i think people will benefit from that uh the


point being buy gold and silver buy physical coins and physical bars and keep them safe so well thanks for joining me mike and i'll see you on the next frequently asked question thank you jeff hi i've got jeff clark the senior precious metals analyst of goldsilver.com on the line with me for another what the fact section [Music] sorry