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Currency
I’ve just started rereading Terry Pratchett’s Discworld series. In the first book, he talks about the debasing of the currency of the realm. Has there ever been a government that didn’t debase the currency? The Federal Reserve was established to preserve the value of the currency, and a dollar is worth about $0.03 of what it was when the Federal Reserve was established.
So, my wife and I have a good chunk of change in the bank. The Fed shoots for an inflation rate of about 2%. Even at that rate, the money we have in the bank will have lost about 15% of its value in 10 years. How fast is it losing value at the present inflation rate of 11%? What’s the point of saving if the government is just going to inflate your savings’ value away?
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That would be if you want take possession of it and not keep it in an account where Joe Biden and his merry band of greedsters can confiscate it too easily.
One key seems to be to get “junk” coins, especially silver, that have no collectible/numismatic value beyond their metal content.
That’s interesting. If 0marova isn’t in office now, her replacement will be. If her view of banking and investment is enacted, what would be the availability of digital currency from such a fund?
I think gold in small increments, nothing larger than an ounce, may be good for a while. But then the problem is finding anything to buy. Next is finding someone who accepts gold. A fifty pound bag of flour (or a 1 pound baggie) still probably won’t cost ten grand or whatever gold rises to. But finding wither someone who converts gold into any currency (or money or whatever it’s called) or finding a guy who will accept a wedge cut from a gold bar or a coin may be tough.
I think the point of nationalizing all banking is not to track all sales, or even to leverage it, but to control who has daily access to how much money.
I’ve eaten it raw with Ritz crackers. It’s edible but I wouldn’t recommend it.
Have you ever had Spam sushi? I wouldn’t recommend it either.
Uncooked spam is definitely gaggable. But I always cook it.
There are smaller gold coins too, but I think those always have more numismatic value beyond the gold itself, and so you pay more. Silver is easier.
I wouldn’t worry about the 15% mark-up, that’s pretty well baked in. But gold is essentially worthless in US dollars. If you buy $100,000 of gold at $1500 and in goes down to 1200 and then up to 1800, you haven’t lost or made anything. You still have 67 ounces of gold. Gold will likely at least hold its purchasing value so long as there’s anything to purchase. Then again, who can tell what gold’s exchange rate will ever be? The price of gold has been artificially manipulated and suppressed for decades (coincidentally, as all central banks keep buying it up).
Maybe silver is more independent of those machinations too.
Modern 1 gram coins have little to no numismatic value beyond the gold itself. Their extra cost is in the minting and the value of being theoretically more easily spendable than 1/2-ounce or 1-ounce coins. An example of this is that the Canadian 1-ounce gold coin was, a few years ago when I checked, demarcated as $5 Canadian, but selling for 350-400 times that price based on the price of gold, with no collectible value.
1 gram of gold is still not “fiddling small change” as the Hitchhiker’s Guide To The Galaxy puts it. But of course much easier to deal with than 1-ounce coins, unless you’re buying a house or a car or something.
The larger issue could easily turn out to be, as you mention and as I’ve written before, being able to use any gold or silver coins to buy ANYTHING, if there’s nothing to buy. That’s one reason why I would prefer to have spare appliances, etc. Especially if that’s all I can afford. Someone with some kind of retirement account to protect, and not a lot of extra floor space for for appliances, may need to rely on coins as their only reasonable alternative. At least it’ll be worth SOMETHING, unlike fiat currency.
I agree. It looks like some people here are smelling the S hitting the F right now. I don’t know about rural life but years ago I read a bit of the blog by Selco who survived the war in Bosnia and wrote articles about it years ago. Now he’s at https://shtfschool.com/.
I don’t remember much specifically about it, but some things I think I remember were that: you should have gasoline cans to buy black market gas for your car. Never go anywhere alone or at night. He made money by creating a connector to refill disposable cigarette lighters from a propane (or butane?) tank I think he kept on his balcony. When you go to an apartment to buy food, don’t take a gun, there will be guys there with more guns who will quietly take your gun. (There’s strength in numbers.) If you go to a place that will sell you five boxes of cereal for a certain price, you will more likely get one box for all that you have in your pockets (and you will lose your gun). And the police are corrupt as hard times make everyone corrupt. They stop you at check points and see what you may have that they want.
There’s also lulz.com (which I haven’t read but may be of interest) which incorporates Selco’s writings.
I found the account that I thought I remembered. The pistol was never taken, and they went looking to buy powdered eggs, which they viewed a luxury items. “Luxury!” And he had two friends with him, one of whom had a pistol, but he forgot about it owing to the rough look of the guys with rifles by their chairs and probably from the carpet stain under their table that looked like blood. He says, obviously, not pulling the gun saved their lives. https://shtfschool.com/category/trading/
Hmm, powdered eggs sounds like another good thing to have on hand. I wonder if I can get them locally?
I don’t know about nowadays, but in years past I’ve looked for them, in camping stores and on-line and I don’t think I’ve ever found them (if so, not at any price I could afford in bulk). And powdered milk is good, too, even if you don’t drink coffee.
I’ve always hated powdered milk. I’d rather do without.
You can always use it for baking, and it’s high in protein. I’m sure it will be very useful for barter if it ever comes to that. Pasta and powdered milk were in the highest demand in Venezuela. Of course buy a ton of baggies. They’re good for separating bulk foods into smaller portions if you want to sell, and have all kinds of other uses. Especially protecting dried and smoked foods from insects.
Silver and gold.
Also copper and nickel. The government is already giving us nickels worth more than their face value. Pre-1982 pennies have almost 3¢ worth of copper in them.
And, of course, ammo and cleaning supplies for your guns.
A 90% (pre-64) dime now has about $1.70 worth of silver in it.
And guns themselves are tradable. Back in the 90s in Bosnia the going rate for a selling a gun, even though guns were scarce, was one car battery.
Selco also wrote that electrical generators are good but noisy and attract attention. It’s better to have a 1000 BIC lighters or flints, “1000 bic lighters don t take too much space, cheap, you can always trade it for something.”
And regarding TP, he wrote. ‘Most of the time we did not have toilet paper, even if i had it, i trade it.”
I think I’ve seen places where you can buy gold by the gram.
Savings are for suckers. Inflation always nails savings.
Inflation (at least moderate amounts) has a silver lining: it forces people to put their money to work, instead of squirreling it away. Real Estate is inherently counter-inflationary – because the money is doing something. So can be investing in companies that are creating real wealth. As Adam Smith wrote, there is a qualitative value in sheep that does not exist in the same value of gold: sheep make products and more sheep.
Silver and gold are ok if everything really goes pear-shaped. But in that scenario, there are more real problems than having enough assets stored away.
It is also easy to get scammed on gold. It is too easy to put a gold film on pewter or lead, and it can be quite hard to prove that you have what you think you have.
‘Squirreling it away’ isn’t really the opposite of ‘putting it to work’, though: unless you physically keep it under a mattress or bury it in the backyard, the bank that you put it in will (in principle) lend a high % of it out to people who *will* put it to work. (Less-true in the current banking environment than it should be and used to be)
Nope. Not a single one, even the ones who never heard of paper money or fiat currency. Numismatists can track the health of historical governments by tracking how much specie was actually in each coin.
This is what bugs me about the goldbugs obsessed over the gold standard as the panacea for our monetary woes. When you get down to it, all currency is fiat currency and subject to inflation and devaluation. Sure, it’s a bit harder to strike coins with less gold or silver than print paper money, but it’s not enough harder to stop it from happening.
I thought that the Federal Reserve was established to prevent deflation, because deflation had been the primary recessionary irritant up to that point. Heck, deflation continued into the 1930s even with the Fed.
I buy powdered eggs via Amazon. It goes for between $0.90 per ounce to $1.50 per ounce (depending on whether you buy in bulk).
They also have powdered butter, powdered buttermilk, powdered cheese, powdered cream, etc. etc. etc.