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James Turk on Gold and Silver (Part II)

ETFs are regulated as equities not commodities for a reason. Paper is paper and metal is metal. I actually have some capital allocated to GLD but I understand it is exposed to the bullion price and not actual bullion.

The differences in how title is held make all the difference. I am sure some of the ETFs give exposure to the bullion price but they are different from owning the bullion itself. In other words, having an ETF has Counter-Party and Performance Risk whereas a custodian like GoldMoney has only Performance Risk. Why else do the ETFs traded at Premiums and Discounts to their NAV?

Fiat Money and the Silver Coin Quotas

Given the recent rulings (Kahre case and March 8, 2008 IRS EMail from Mrs. King with IRS employee ID# 59-05667) about the 'legal tender' value for tax purposes I would not be at all surprised if more people are using the legal tender gold and silver coins in daily transactions. There was an article about a gas station owner in OR doing such. Why not when you can have .25$ of Gross Income and $3 of COGS for a Net Loss of $2.75. Thus, it appears that through the use of legal tender one can reduce their tax liability. Of course the US Treasury and IRS would want to contract the legal tender supply to hamper this usage.