Gold: Sacred Cow or Useful?

[raptor]

"Did you hear that Prince Edward Island was never hit by the Z virus? They have government, power and medical care. They are taking refugees, but you have to buy your visa and they only trade in gold..."

In keeping with the whole purpose of the thread...in this example why would they want gold?

In a ZPAW what value would gold have?

[Stercutus]

In a ZPAW what value would gold have?

Easy. You can make gold magnets out of it that attract Diamonds and coins.

[woodsghost]

In a ZPAW what value would gold have?

Easy. You can make gold magnets out of it that attract Diamonds and coins.

Haha!!!! Should have seen that coming.....

[gundogs]

it is hard to buy a ticket out of the SHTF zone with your purse full of chickens.

True.

I just wish my gold would make more of itself like my chickens do.

What? Your gold does not reproduce itself? Try putting some Viagra in there with it. Worked for me. Now I have nuggets everywhere. I hear rhinoceros ivory works too.

Except rhino horn is keratin,which is what hair consists of.

[NamelessStain]

I know we've discussed this topic before but it was under a broader category of precious metals (PMs).

It has value if someone else thinks it has value.

I personally believe that PMs will regain value once all the basic needs are met and a large trading network is established.

[ineffableone]

I know we've discussed this topic before but it was under a broader category of precious metals (PMs).

It has value if someone else thinks it has value.

I personally believe that PMs will regain value once all the basic needs are met and a large trading network is established.

I think the only time PMs will ever not have value is when food becomes hand to mouth. When ever there is a surplus I think PMs will be a possible to trade. Now what the value of them and if certain people will trade for them is another story. Expect plenty to refuse trade in PMs just due to inexperience with them.

If things are still in chaos but food available the value of gold and silver is not going to be what the market value was before the chaos, but it is likely going to hold more value than paper money. At the same time it is not something the average person is used to using in exchange for goods, so setting value and agreeing on exchange is going to likely be more complicated. This is why some of the coins that have a $ value printed on them can be good. It gives a nice visual reassurance to the potential buyer of the value of that coin. Something that might be beneficial to folks who stock up on PMs is to print out or have a small pocket book that references the $ value of the PMs at certain weights. This would allow you to share the info to potential traders what the value was, and give them a starting point to figure the current value. Though I would suggest you expect 1/2 value or worse in a time of crisis where PMs are still valued. I would not expect an ounce of silver to be valued at $20 (the general average currently) but more likely $10 value or even $5 value. Even if PMs rise in value in the run up to the crisis to for example sliver being worth $50 and ounce, once the crisis actually hits don't expect that value to stay. When you have PMs and want to trade for food, ammo, water, medicine, etc your essentially trading something with no function for something with function. The folks who will accept PMs are the ones hoping to come out of the crisis with the PMs and that then the value will rise again. Them accepting PMs is an investment and hope that things will get better rather than worse. And if they are the ones with the goods you need, they set the price and value of the PMs.

[raptor]

On a slightly different tact I would note that there have been instances when having gold was a liability. For instance during the Russian civil war the bolsheviks not only seized government gold they seized it from private citizens and if you attempted to buy things with this gold you were deemed a counter revolutionary and dealt with accordingly.

Now I guess in this situation your real estate and all other preps would likely be at risk also. So perhaps gold's portability would come in handy assuming you could leave.

[Stercutus]

On a slightly different tact I would note that there have been instances when having gold was a liability. For instance during the Russian civil war the bolsheviks not only seized government gold they seized it from private citizens and if you attempted to buy things with this gold you were deemed a counter revolutionary and dealt with accordingly.

Now I guess in this situation your real estate and all other preps would likely be at risk also. So perhaps gold's portability would come in handy assuming you could leave.

Same thing happened in the United States too. Keep in mind that small portable wealth has more risks associated with it.

[raptor]

Same thing happened in the United States too. Keep in mind that small portable wealth has more risks associated with it.

This is quite true.
The gold confiscation in the 30's was slightly different from the bolshevik seizure. The bolsheviks seized the gold without compensation; the US paid the regulated price for surrendered gold and gold coins with collector value were exempt. The bolsheviks shot counter revolutionaries who ere caught with gold. The US did not shoot people caught with illegal gold bullion.

Still the point remains valid; at times the possession of PMs may be dangerous.

[Kathy in FL]

As others have mentioned PMs are basically placeholders in your portfolio. Their primary function is as a way to carry over wealth from one generation to the next. To be honest, you'll get a better return by initially putting any surplus in your budget into getting out of all debt. Then use any surplus to fix your physical residence ... pay off your primary location (bug in) and/or purchase and payoff a BOL and get it secured and supplied.

Then if you get all of that taken care of and you have a legitimate surplus in the budget a reasonable percentage of your portfolio in hard PMs (not paper) shouldn't be anything to hold you back. Just remember if you don't hold it you don't own it so you will need to have a secured residence and storage plan BEFORE you invest in those PMs or they can make you a target.

Also, purchase in small enough quantities at any given time that you don't draw attention to yourself. Getting much harder to do these days but it is doable.

[2now]

Raptor,

I thought my imaginary refuge using gold was obvious, but I was wrong. My logic runs like this:
Imagine you are telling a campfire story aobut a beautiful refuge that still has civilization, after a PAW.
Image they have all the things that nomral civilization has to offer, that means trade and currency. So a member of your audience asks you what you would want to bring with you there to trade for their currency.
for the story to work; It has to be easy to carry, have a perceived value, be easily verifiable and be attainable.
Given that every major civilization has valued gold, it is just a natural choice.

Tell the story enough times, and it will fill a need for a hope for a better life.

What am I missing?

[Doctorr Fabulous]

Raptor,

I thought my imaginary refuge using gold was obvious, but I was wrong. My logic runs like this:
Imagine you are telling a campfire story aobut a beautiful refuge that still has civilization, after a PAW.
Image they have all the things that nomral civilization has to offer, that means trade and currency. So a member of your audience asks you what you would want to bring with you there to trade for their currency.
for the story to work; It has to be easy to carry, have a perceived value, be easily verifiable and be attainable.
Given that every major civilization has valued gold, it is just a natural choice.

Tell the story enough times, and it will fill a need for a hope for a better life.

What am I missing?

it has to be plentiful, divisible, and easily recognizable. If you're the only one withit also has to have value to everyone. If you and two other people are the only ones with gold, then it's unlikely that everyone you trade with will be willing to trade in gold.

In other words, you have to be able to convince the other party that your gold is worth their goods. "It's always been valuable" or "store of wealth" aren't convincing when you only have three meals on the shelf. Or, as I told the last guy who tried to trade silver for a rifle, if it's really better than cash, then go get the cash you swear it's worth and call me back.

[Halfapint]

As others have mentioned PMs are basically placeholders in your portfolio. Their primary function is as a way to carry over wealth from one generation to the next. To be honest, you'll get a better return by initially putting any surplus in your budget into getting out of all debt. Then use any surplus to fix your physical residence ... pay off your primary location (bug in) and/or purchase and payoff a BOL and get it secured and supplied.

Then if you get all of that taken care of and you have a legitimate surplus in the budget a reasonable percentage of your portfolio in hard PMs (not paper) shouldn't be anything to hold you back. Just remember if you don't hold it you don't own it so you will need to have a secured residence and storage plan BEFORE you invest in those PMs or they can make you a target.

Also, purchase in small enough quantities at any given time that you don't draw attention to yourself. Getting much harder to do these days but it is doable.

VERY wise words this is what I think most people have been saying generally, but you put it more more eloquently.

[raptor]

In other words, you have to be able to convince the other party that your gold is worth their goods. "It's always been valuable" or "store of wealth" aren't convincing when you only have three meals on the shelf. Or, as I told the last guy who tried to trade silver for a rifle, if it's really better than cash, then go get the cash you swear it's worth and call me back.

This is quite true. One way to improve the negotiability and recognition of PMs is to acquire silver and gold coins issued by a government. For instance Canadian Maple Leafs and US gold coinage. One upside to this is that you have established in effect a floor on the value. The floor is the face dollar amount of the coinage.

Though by doing this you will generally pay a much larger premium over bullion. That said I think it would be whole easier negotiating a maple leaf or eagle than say a 1 oz bullion bar.

[.milFox]

Precious metals have little/no value in a worldwide PAW. Compared to lots of other things, anyway.

In a semi-PAW with some semblence of order, or a refugee generating event, you might get something for your precious metals. At least those you can carry with you.

[Mad Mike]

Another problem with gold: how do you make change for smaller purchases?

[nolongpork]

Another problem with gold: how do you make change for smaller purchases?

That problem exists worst in barter scenarios.
Gold and silver are pretty easy to divide a cow chicken or rifle not so much.

PM's already come in a variety of sizes down to one gram in size and there is always the old fashioned way like the piece of eight.

the modern version:
https://bullion.nwtmint.com/silver_stagecoach.php
https://bullion.nwtmint.com/gold_valcambi.php

[woodsghost]

Cows and chickens are easy to divide. If you have butchered them, you give a portion of the meat. If you have not butchered them, you agree to give the other person eggs or milk for the next 15 or 100 or however many days.

[nolongpork]

Cows and chickens are easy to divide. If you have butchered them, you give a portion of the meat. If you have not butchered them, you agree to give the other person eggs or milk for the next 15 or 100 or however many days.

And why would this be any different for gold and or silver? Hell in your scenario you are using form of credit

any sale with out governmental input (taxes or other restrictions) is solely up to what ever the purchaser or buyer determine what is an acceptable exchange.

Now gold and silver have had the longest history on the planet for being a standard medium for exchange.

I think it depends on how long you envision SHTF I think it has much merit in storing wealth from the collapse of a paper and credit fractional reserve economy to the start of a new economy but it may or may not be of use between those two times. So it would depend on the timeline you envision.

[Kathy in FL]

The answer is pretty simple really. You won't use PMs in a PAW situation except for LARGE purchases and you sure as heck won't be making change. For smaller purchases you'll either be using whatever the local currency is - which in actuality could be anything including bullets and food to salvage to some kind of scrip - or you will barter.

And if you are looking for an historical perspective on the use of PMs as currency please remember that areas like the ancient Roman empire and ancient Egypt and their trading partners used debased metal coins that were rarely pure in content. A "silver" coin wasn't necessarily 100% silver. A "copper" coin wasn't necessarily 100% copper ... etc. etc. etc. And when I say "debased" I meant that it was intentionally kept valued below its so-called intrinsic value plus they had problems with inflation and all that other junk just like we do today. It is an interesting study.

[Mad Mike]

The answer is pretty simple really. You won't use PMs in a PAW situation except for LARGE purchases and you sure as heck won't be making change. For smaller purchases you'll either be using whatever the local currency is - which in actuality could be anything including bullets and food to salvage to some kind of scrip - or you will barter.

And if you are looking for an historical perspective on the use of PMs as currency please remember that areas like the ancient Roman empire and ancient Egypt and their trading partners used debased metal coins that were rarely pure in content. A "silver" coin wasn't necessarily 100% silver. A "copper" coin wasn't necessarily 100% copper ... etc. etc. etc. And when I say "debased" I meant that it was intentionally kept valued below its so-called intrinsic value plus they had problems with inflation and all that other junk just like we do today. It is an interesting study.

That's my point. Gold is of limited use in a PAW - and having a lot of it could mean you don't have enough of what you'll really need. That plus, if the word gets out somehow, will likely make you a target.

[Browning 35]

Pretty much the point. Is anyone of the mind here that any of us are going to be facing and trying to survive in a post apocalyptic world? I mean real zombies and raiders with purple Mohawks zooming around crotch rockets clad in ass-less chaps.

More than likely we'll see the same sort of natural disasters, war, civil war, riots and the occasional economic collapse we've seen so far in recorded human history (where gold has value for when cash takes a shit).

[nolongpork]

The answer is pretty simple really. You won't use PMs in a PAW situation except for LARGE purchases and you sure as heck won't be making change. For smaller purchases you'll either be using whatever the local currency is - which in actuality could be anything including bullets and food to salvage to some kind of scrip - or you will barter.

And if you are looking for an historical perspective on the use of PMs as currency please remember that areas like the ancient Roman empire and ancient Egypt and their trading partners used debased metal coins that were rarely pure in content. A "silver" coin wasn't necessarily 100% silver. A "copper" coin wasn't necessarily 100% copper ... etc. etc. etc. And when I say "debased" I meant that it was intentionally kept valued below its so-called intrinsic value plus they had problems with inflation and all that other junk just like we do today. It is an interesting study.

That's my point. Gold is of limited use in a PAW - and having a lot of it could mean you don't have enough of what you'll really need. That plus, if the word gets out somehow, will likely make you a target.

If you have anything in the PAW you describe you are a target the smell of your breakfast meal drifting to people a mile a way is going to make you a target more than a rumor of gold.

If you say gold is going to have limited use, that cuts both ways if you cant spend it, it is because people don't want it.

I have not seen anyone recommending not having a good set of preps or that you can use gold or silver to buy a full magazine in a firefight.

I feel It will be useful in the beginning of a slow to medium speed crash when people can't electronically access money banks limit withdraws and the people learn paper money is made out of paper. Something fast like being nuked not so much.

I also feel it will have use when things start again because there is the historical precedent of this literally going back to the start of recorded history. Even if the coinage is diluted you have the base metal and you could become the mint and be the next JP Morgan perhaps.

I do not know if I need 5000 .22 bullets or 300 lbs of rice or an extra water filter. The PAW is an unknown so I have prioritized my list of needs, this would make life suck less, and wants. I am sure most all others have as well. I feel PM's are on the list and can be a strong asset in the right times.

I have a rifle that should last forever It is also of use in the proper times, I have a back up even to that rifle. So if you were me would you spend another $2000 dollars for a back up to a back up? or move further down the list of PAW priorities to something else?

I have not seen anyone recommend skipping out on the basics.

I think it depends on your timeline you are preparing for I have not read anyone thinking that gold is useful in a firefight or buy gold instead of food.

[woodsghost]

Pretty much the point. Is anyone of the mind here that any of us are going to be facing and trying to survive in a post apocalyptic world? I mean real zombies and raiders with purple Mohawks zooming around crotch rockets clad in ass-less chaps.

More than likely we'll see the same sort of natural disasters, war, civil war, riots and the occasional economic collapse we've seen so far in recorded human history (where gold has value for when cash takes a shit).

Well.... I might have bought some assless chaps and purple hair dye the other day..... maybe told the clerk it was for Friday night but....

Seriously, I do believe I could face a PAW/TEOTWAWKI. Which is why I am on this site. I believe in being prepared for zombies, aliens, assless chapped bikers, orcs, and/or ninjas. I figure a tornado or hurricane is nothing compared to them.

Also, I do believe natural disasters, war, civil war, riots and economic collapse are a little more likely than orcs or aliens.

I do believe this world *could* go to hell. Whether it *will* or not is something I will discover as life ticks away.