I'm more a silver bug than a gold bug, just because it's cheaper to buy and easy to spend lower denominations vs. gold. That being said, here is my reasoning.
1) I firmly believe that we are in for a good bout of inflation (an extreme maybe hyper-inflation) If I buy silver at $11/oz and can sell for $?/oz (currently at over $16/oz) during inflationary times, I've hedged against inflation. This is purely an economic/inflation hedge.
2) If a SHTF situation happened, I think monetary greed would exist for the first few weeks, maybe a month. The first few days, you could probably dump dollars but after that, silver/gold would become something of worth during the initial phases. ( I guess I'm smart enough to know that I'll forget/can't afford something now and may be able to "pay" for it early on). If the SHTF situation was more USA based, gold/silver will be worth something in a foreign currency later.

 

For something to be an investment, it should out-pace inflation. From what I've seen, as prices inflate so does the price of PM's. So my take is that PM's are a safe place to park wealth -- and hedge against inflation -- but don't expect much of an investment (out-pacing of inflation).

The other nice thing about PM's is their storage capacity of wealth. It's foolish to think that everyone will barter service for every good. Sometimes you won't have time, or a service that someone is interested in. So PM's are a wealth storage+exchange mechanism -- easily transferable wealth in the old-fashioned and true sense.

 

Robot, there are those that seem to think gold/silver has some "intrinsic" value regardless of circumstances. I agree with YOU. It would be worthless to ME so it has no value if you want something I have.

If our gov't and society tank then it is a crap shoot. Without central markets there would be nothing to determine its real worth.

What am I going to do with a bunch of gold when there's no place to sell it and no currency to guage its worth by? I'd rather have something I can USE (shelter, fuel, food, transportation, etc).

 

Here's something interesting about those pre-64 quarters that a friend of mine pointed out to me. Back in 1964, a gallon of gas was about $.30 so close to a quarter. Now that same quarter can still buy a gallon of gas. The present exchange is just over $3.00 so you would get some change back.

I know you guys have already pointed this out somewhere but I just thought that was a cool fact.

 

Not only was it "a cool fact", it was a demonstration of the difference between Currency and Money. :thumb:

 

How do you buy silver? Coins have a premium because of the collector intrest. Where can you get silver at or neer the posted price?

 

Not all silver coins hold collector interest. Only MINT/Near Mint coins collect interest from collectors. If the coins are worn, they dont want them really. Go to a coin store and you will find JUNK LOADS of Morgan silver dollars for sale for arround going rate of silver. Usually the are in a bin under the glass or something. Again only the premium coins will interest collectors.

 

Ammo: currency of the new MILLENNIUM....

 

Ammo: currency of the new MILLENNIUM....

Yep, :thumb:

 

During the SHTF/transition period, the value wouldn't be stable. I know people that would have traded an ounce of silver for a gallon of gas in the Rita evac.

After TEOTWAWKI, it will stabilize, probably along historical values. Generally:
1/4 oz silver per hour for unskilled manual labor/entry level
1/2 oz per hour for experienced manual labor
1 oz per hour for journeyman labor or skilled special task labor (electrician, vehicle tech, etc)

These are just rough figures off the top of my head, really, but they roughly match current wages, and wages for the past century.

 

Gold and silver have been used as a medium of exchange between people for ALL OF RECORDED HISTORY.

Are we done here?

 

our dependency on paper and the electronic dollar has diluted the ability of people to think of gold and silver as money.

Gold and silver has become a fashion accessory rather than currency.

We can look at history, but things have really accelerated in recent history, especially in a place like the US, where most people would see gold or silver as useless, even if they wanted it probably 95% or more wouldnt know or recognize any value. Now its few farmers, few people who live off the land, and few people who have careers or skills that will be usefull when the society as we know it collapses. Typing 100 wpm is good for the resume, and is of value for many workers today, rather than being able to produce structure, food, fuel.

Consumable goods and services will have more value because there will be more consumers and few able to produce.

 

My attitude on metals is that they're a way to preserve wealth when the economy crashes. If you haven't already bought in, it's too late in my opinion. The prices are about double the actual value. In a serious crisis, they'd still go up, but otherwise they're likely to go back down to where they belong, taking your investment with them.

You might pick up some junk silver coins for bartering, but don't count on them doubling in price any time soon unless there's a major crash.

I bought in back in the 90's when prices were under the real value. That's the only way I'd ever do it again too.

 

(Sigh) Once again,folks......gold and silver are a way of protecting wealth,not a traditional "investment". If you don't have any wealth to speak of, then you'd be an idiot to scrape up all your money and go buy a 1/2 ounce gold eagle. Obviously,as has been stated here,ad nauseum, that same $500 would be more wisely spent on other preps,like food,water,ammo,tires for the car,etc.
BUT..... if you have a large amount of idle currency,and your preps are in order, you'd be a fool not to consider PM's,especially with all the evidence we have that hyper-inflation and/or a currency collapse are looming.

 

I've never been part of a discussion forum yet, that the same questions didn't come around regularly. People aren't going to go and read every post on the site before asking questions. This site is no different in that regard.

If it pains you so much to answer the same question repeatedly, then feel free not to. People don't need to run into the "not this again" attitude when they have asked the question, for what to them, is the first time.

 

Gold and silver will only have value if society still maintains a division of labor. There fore it depends on how far society falls and if it recovers. If there is truely no division of labor everyone is going to hunt and grow there own food. No one will care about gold or silver, we will instead trade only tangible items such as food, clothing, ammo, labor, and knowledge.

 

This was pretty much my train of thought, along the lines of total collapse. lots of good replies about other scenarios.

Thanks for the information folks:thumb:

 

OK, not getting into intrinsic vs. perceived value, what it comes down to is folks have been told since birth that gold is valuable. From the Alaskan Gold Rush to Silas Marner to hundreds of pirate, D&D, and fairy tale stories, gold represents wealth beyond measure. It's cultural programming. So. In a SHTF situation, when people lose faith in fiat or any other form of currency, waving a gold coin under someone's nose will probably STILL trigger their acquisitive desire, and they'll be willing to trade things that have true, survival value for a piece of metal that has little real value.

At least, that's the idea.

 

All value is perceived. Without some other human, or group of people, who wants it (via perception), it lacks all value -- whether paper monopoly money, gold, silver, ammo, etc. "Intrinsic value" is pretty much an oxymoron, since "intrinsic" suggests inorganic and independent of context, whereas "value" is a human judgment. Value is pretty much a human/perceived thing unless you're bartering with non **** sapiens...

 

Not trying to hijack this thread into a religious discussion, but I beleive we are living in fortold times. These two verses from the Bible tell me that goods and services are where the value will be when the SHTF.

Ezekiel 7:19 They shall cast their silver in the streets, and their gold shall be removed: their silver and their gold shall not be able to deliver them in the day of the wrath of the LORD: they shall not satisfy their souls, neither fill their bowels: because it is the stumblingblock of their iniquity.

Revelation 6:5 Then when the Lamb opened the third seal I heard the third living creature saying, “Come!” So I looked, and here came a black horse! The one who rode it had a balance scale in his hand. 6:6 Then I heard something like a voice from among the four living creatures saying, “A quart of wheat will cost a day’s pay and three quarts of barley will cost a day’s pay. But do not damage the olive oil and the wine!”

Just my .02

 

Good insight! Thanks Buddy!

 

Gold fever

Many years ago I bought my girlfriend a gold rope necklace. It rests heavy in the hand when you pick it up and it has that color that draws your gaze.

When gold was well below $300 an ounce, I bought her (now my wife) a one ounce gold coin with a gold bezel around it.

If I handed some average person that rope with the coin hanging from it, they might instantly feel how heavy it is in relation to how big it is, and it looks big. The sight of that much gold, beautifully crafted, might stir strong longing in your average greedy individual.

In an extreme emergency, like say if I really and truly needed to come up with a bribe right then and right there, it could make the difference between life and death for a loved one.

This is the kind of power that gold has always had.

 

This is the kind of power that gold has always had.

True, in the worlds history you are absolutely correct however, there will come a day when it does not have that kind of power. When? Who knows and maybe the next time it hits the fan will not be the time it looses it's value - but I'm preparing for the worst and praying for the best.

 

Here you go..
http://economicedge.blogspot.com/2009/09/max-keiser.html

 

Gold/silver will be pretty worthless, at least to me.

Salt was once used as currency. I think it would again should the SHTF

Seasoning, preserving, electrolytes/vitamins, cleaning, and many many other uses make salt a good choice.

 

Just adding to what has already been said. Not one person on this site has ever recommended that someone with no preps go out and buy metals. That would be a clear case of misplaced priorities.

Metals may well be our best shot at a universally accepted medium of exchange. A weath preserving measure that may realize gains that can be tapped for use whenever needed. Similar to a savings account coupled with an insurance policy against financial catastrophy brought on by reckless government fiscal policies. Financial survival, if you will. Financial survival is not as glamorous as the discussions regarding preparations for the meltdown of society so it often is ignored in favor of beans and bullets being a touted as a universal medium of exchange. It is like comparing apples to oranges.

Some metals will protect your the purchasing power of your wealth through currency exchanges, recalls, devaluations, inflation, hyper inflation, etc. and has done so throughout history in all corners of the planet. Sure, a person dying of thirst or starvation would rather have water or food than gold or silver but is that a justification that we should only rely on food and water to preserve wealth? Apples and oranges.

Forgive us. This subject comes up all the time. You would think that adding a few silver coins to our preparations was some kind of insane act. The current metals buying level by those who support our countries debt is alarming. When the guys at the controls start to run, I suggest we follow them.

 

The problem with the thinking that gold and silver will become the currency of choice is that at least 95% of people don't have any, the rest may have just a few coins. In a real and sustainable SHTF situation $$$$$ will continue to be the currency for some time until people loose all trust in it. When the $$$$$ is no longer trusted and accepted, people will turn to barter - goods and services for goods and services. I am not saying that there won't be anyone who would be willing to take gold in exchange for something of yours but I am sure that some will have a hard time figuring out why a bottle of Listerine or a box of .45ACP would cost them a few Gold American Eagles.

 

Well, as others indicated there were points in the 20th century of people with wheelbarrows of worthless money, shot to oblivion my inflation/devaluation, etc. People might find some other sort of currency. If the dollar should ever become almost worthless, what other things will people use as a store/exchange of wealth/labor?

Something onto which they embed wealth, until another exchange for goods/services. The problem with a lot of things is that they have shelf-lives. And as for ammo, you can't eat it.

 

Don't forget the value of any gold and silver jewelry you might have.

The Celts, Germans and Vikings of the Dark Ages, used jewelry as currency. Men would wear gold wound around their upper arms and torques around their necks. If they needed to make an exchange for food or services they would simply cut off a bit of their jewelry and use that as currency. Chieftains/warlords would give a whole piece of jewelry to a trusted and valued warrior as reward for their loyalty, and to keep their loyalty.

I'm thinking that, instead of minted coins or bars of gold/silver, this might be an easy way to keep your cash close and use it. Keep 24k gold chains and just cut off a couple links for trading. You would use the weight of the metal in the case of gold to determine the value of what you were offering in the exchange. And there are ways of testing silver to determine its purity and could be used in the same way.

Anyone ever seen a movie of the old days where someone would bite a coin to determine if it was pure gold? Gold being very soft and malleable it was a common way for someone to determine the purity of a gold coin.

14k gold is usually a mix of silver and gold at a certain percentage of each. If you smelt your gold jewelry down to it's component parts you would get both metals in return and could then form it however you wanted. I'm not sure if the little smelters used by reloaders to smelt lead would be hot enough for gold. I imagine they would.

Just some meandering thoughts on this conversation.

 

7 minutes of good info, that pertains to this subject.
http://www.youtube.com/user/kdenninger

 

LOL !! : I just posted this video less than an hour ago, the thread titled "Warning:deflationary collapse.....". :thumb:

 

gold is for wealth silver is for bartering.I have been into gold and silver for about two years gold is as high as it will most likely get but stranger things have happen.Silver is still somewhat under priced.

 

If I buy silver at $11/oz and can sell for $?/oz (currently at over $16/oz) during inflationary times

I just had to resurrect this thread.
$?/oz is $35/oz now