I totally get the argument for precious metals as a hedge and "insurance policy" against rampant runaway inflation, but don't you lose a lot more than 2-5% when

I totally get the argument for precious metals as a hedge and "insurance policy" against rampant runaway inflation, but don't you lose a lot more than 2-5% when you pay the premium over spot to buy it? Also, how useful/liquid are gold and silver in a serious economic downturn?