Posted on 11/20/2014 6:40:09 PM PST by blam
Nov 20, 2014
Guy Christopher
Guy Christopher writes: A lot of folks took advantage of recently falling gold and silver prices to beef up their precious metals holdings.
Those adding to their portfolios understood the old adage of buying low and selling high. Unfortunately, others wait until dollar values of gold and silver have zoomed before deciding to convert their paper money.
Still, most make buying decisions for their own good reasons. They either have the confidence of their convictions, or they have good questions still unanswered.
One of the frequent questions we get at Money Metals Exchange is a good one – How would I go about “spending” my gold and silver in a barter-type economy?
Readers and clients want to know if gold and silver would be accepted by a shop merchant or by a tradesman offering his talents. They ask how a seller would “make change” for gold and silver coins or bars. We feel those are perfectly valid questions.
The answer highlights the simple advantage gold and silver would give you in every financial transaction.
(snip)
You'll recognize another way of saying it – He who has the gold makes the rules.
(snip)
(Excerpt) Read more at marketoracle.co.uk ...
Get some of this too.
If he had been smart, he would have sold it all at $1600, held the cash, then bought at $1200. But I bet most people didn’t do that.
If it ever comes to SHTF time, would a person be willing to fork over a gold coin they paid $1200 for to get a chicken or a quart of milk? If so, their stash won’t last too long.
all this gold bug stuff assumes there will be confidence in a hunk of metal after confidence in money is gone
That’s why I buy junk silver coins, dimes, quarters and half-dollars minted before 1965. They’re 90% silver and contain about 7.15 tr oz per $10 face value. Everybody recognizes the coins and they are visually distinguishable from cupro nickel coins
Been doing it. Now trying to add to the pile @ whatever the property tax bill is each year. I figure no matter what happens we will always have to pay those darn property taxes. I think they are unconstitutional and immoral. LOL
Plata O Plomo.
How many chickens or quarts of milk do you think you’ll be able to buy with a stack of worthless paper?
If I’m selling chickens and you come to me with worthless paper and the next guy in line has a gold piece......he and his family will be feasting that night while yours will be going through his garbage for the bones.
“How many chickens or quarts of milk do you think you’ll be able to buy with a stack of worthless paper?”
the same amount as with a hunk of metal
“If it ever comes to SHTF time, would a person be willing to fork over a gold coin they paid $1200 for to get a chicken or a quart of milk? If so, their stash won’t last too long.”
There are several issues the gold people miss. First, my big question. If money is so worthless compared to gold, why are they willing to give me something valuable(gold) for something worthless(paper)? Clearly they value the paper.
Next issue. Gold coins were actually exceedingly rare through history. It isn’t like people walked around with bags of the stuff. It was the equivalent of the $1000 bill. Rare, and not easy to use for the small stuff of every day life. Silver was far more common, among other types. Often it was not pure gold either. And coins were not the large things we know of today. Most were small. Think penny.
Last, in a SHTF situation, am I going to trade a chicken for a gold coin? That chicken if food. It is breeding stock, it has practical use. That gold coin does not. That gold coin is valuable only because someone else might give me something in exchange for it, simply because he is stupid enough to value useless metal over a valuable chicken.
Currency might make a comeback after a SHTF situation, as currency is easier than barter, but not during one. During one, people will only be interested in things of practical value.
Goldbug ping.
“the same amount as with a hunk of metal”
I guess some people must starve. Usually it is the stupid.
In a low civilization environment, gold and sliver are TRANSPORTABLE ways of taking wealth with you. Say you need to go 50 miles to get penicillin. The Penicillin maker only takes chickens (he’s like you) So are you going to tale 40 chickens 50 miles to get penecilliuan? No you are not. You will take silver or gold and buy chickens when you get there and then give them in exchange for the penicillin. Not everyone will be gold adverse . Some will others not.
Same here.
If you were really serious about this, you’d be hoarding .22 ammunition. You’ll be able to barter for anything with a handful of .22s.
In a SHTF scenario, think bullets, not gold. Currency would make a comeback, for the reasons you mentioned, but only after things stabilized. Also, think smaller than gold. Or worse actually.
There are two possibilities in a SHTF scenario.
1. 90% of people are gone. There is a lot of gold junk out there. Your gold’s value will crash, especially if people decide it is useless junk. Now it isn’t even rare. They have tons of necklaces, rings, and other trash. Any kind of currency could become useless. Even bullets. Remember, you’re dealing with the left over resources of a massive industrial society.
2. Economic collapse, but most of the population survives. Gold has a problem. No one can make change for that pretty gold piece. That was the historic problem with gold. Most people didn’t trade in gold. It was silver, brass, copper, etc.
Gold was the currency of the nobility, for buying armies. Even for the nobility, gold was excessively valuable. And those were not these fancy large coins we have today.
Gold, or even silver, are not the panacea of survival people think they are. Look to history first, where they lived in the manner people are concerned about.
Yes, but how many handfuls of 0.22 can you carry or store safely? If you're looking at protecting several hundred dollars of wealth, ammo is the way to go. If you're looking at protecting several hundred thousand dollars of wealth, you've already got plenty of ammo, now you're looking at something with a decent value to weight ratio, and that's gold.
Warren Buffet seems to agree with you. If you have a loaf of bread and I have a gold coin or a pound of gold- I can’t eat it. Really if things go down hill how many people are really going to prefer gold to barter?
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