Why Precious metals and gems?

[singlesix]

Scarcity equals value.

 

[IndyDave1776]

Many good points have been raised. Gold and silver would be excellent vehicles for dealing with a Wiemar Republic-type monetary collapse. I have to take the position that they would be next to worthless for the duration of a general collapse in which the action will be found in beans, bullets, and band-aids. The metals may be useful after that point during the rebuilding in which there is no functioning currency but a functioning economy shaping up. In any case, having your physical needs met is more important than having an ersatz-currency in form of precious metals or valuable stones. If you have the resources to see to maintaining your habits of living indoors and eating regularly in relative safety, then by all means convert some green into gold and/or silver to hedge against future currency problems.

 

[IndyDave1776]

Scarcity equals value.

Only when there is a demand. Food, shelter, and safety will trump shiny things when they become scarce.

 

[Brandon]

I do it for multiple reasons.
Diversify. Collection in the event stuff doesn't hit the fan, as we all know not everyone is into guns and ammo so there may be something I need if SHTF and gold/silver is the only way to get it.

 

[warthog]

there are good reasons but to think the world can't stay collapsed is not and easy one to defend unless you think War Lords as a society.

Once the demand and the idea of money goes away, gold is only pretty,

As for my funds, if you're doing it to invest then that is different. I speak to those who think it will be worth a squirt once the economy is over and done. Right now it doesn't look to prove much of an investment unless you've had the gold prior to Obama. Now it is expensive stuff. Of course it isn't a market I am following closely so maybe I am wrong. As an investment Gold always seems worth it. That isn't what I am talking about here though.

 

[IndyDave1776]

I do it for multiple reasons.
Diversify. Collection in the event stuff doesn't hit the fan, as we all know not everyone is into guns and ammo so there may be something I need if SHTF and gold/silver is the only way to get it.

Yes, but this is only applicable if you have already stored enough of things which are immediate needs. Please don't tell me that you plan to keep the bogey persons away with wishful thinking while waiting for that guy to show up who wants your gold coin you bought instead of ammunition more than he wants his whateveritis that you didn't think to have instead of gold.

I will concede that diminishing returns will set in with most anything you can store, but few of us an afford such a store of food, shelter, fuel, and arms that we will have a lot of surplus money to invest in more exotic preps like precious metals and gemstones.

 

[singlesix]

Only when there is a demand. Food, shelter, and safety will trump shiny things when they become scarce.

And so you prove my point. All I said was Scarcity equals value. When Food is in short supply it's value increases ...

 

[warthog]

And so you prove my point. All I said was Scarcity equals value. When Food is in short supply it's value increases ...

so you are with me wondering why Gold etc or not? Or are you simply here to stir the pot w/o taking a side?

In any case, food shelter and water not in that order will be the stuff in the biggest demand for the length of the problems. Rarely will things lacking intrinsic survival value be in demand until the end of those troubles, if it comes in our lifetime, come into view. I freely admit that once those things become worthwhile will be never if things don't come to an end and "order" is restored. Personally I think when the bottom falls out, and that is certainly coming, they will not be resolved in any type of short term. When things DO start getting back to "normal" though is a different beast altogether.

 

[HeadlessRoland]

"Mises showed, as far back as 1912, that since no one will accept any entity as money unless it had been demanded and exchanged earlier, we must therefore logically go back (regress) to the first day when a commodity became used as money, a medium of exchange. Since by definition the commodity could not have been used as money before that first day, it could only be demanded because it had been used as a nonmonetary commodity, and therefore had a preexisting price, even in the era before it began to be used as a medium. In other words, for any commodity to become used as money, it must have originated as a commodity valued for some nonmonetary purpose, so that it had a stable demand and price before it began to be used as a medium of exchange. In short, money cannot be created out of thin air, by social contract, or by issuing paper tickets with new names on them. Money has to originate as a valuable nonmonetary commodity. In practice, precious metals such as gold or silver, metals in stable and high demand per unit weight, have won out over all other commodities as moneys. Hence, Mises' regression theorem demonstrates that money must originate as a useful nonmonetary commodity on the free market." - Murray Rothbard

The Case for Genuine Gold Dollar

http://mises.org/money.asp

And I'm now done with this thread.

 

[BehindBlueI's]

A quick note on scarcity as a measure of value.

Simply being rare or having high production costs don't make an object scarce. An original Rembrandt is scarce, however if the demand for classic art disappears it is no longer scarce, however it remains rare. If I make an oil painting and then die, my original artwork is also rare. However it is not scarce, because there is no demand for my paintings.

In short, items that have no intrinsic value can not be assumed to remain valuable based on scarcity, even if the available supply remained the same (which it doesn't as more gold is constantly brought to market). Food has an intrinsic value, as does ammunition, steel, water purification filters, etc. Gold does not. They are not the same.

 

[Justus]

I don't prep more than to be able to get through a natural disaster. Beyond this I put myself in the Lord's capable hands.

I want to know something though, why precious metals and gems? You can't eat them and they won't be worth much if the economy collapses. I know if a guy/gal came to barter for a gun or whatever and had gold bars I would tell them to get something good to eat or something that helps me cook or solar panels etc.

Gold/Silver would not fit this bill for me. All it is at this point is pretty. My money is better spent on food storage etc IMO so help me on this one.

Economic collapse does not equal TEOTWAWKI.

Economic collapse is exactly why I would be buying PMs. Researching what people ACTUALLY did during the past collapses is the best way to answer your question and then take a look at the isolated financial collapses that happened since 08. Most collapses take place over a long period of time and the bills still have to be paid during that time.

I think taking a barter mentality too early in one's preps will lead most people to hard times, the mortgage company and electric bill can't be paid with ammo or rum and it could be a real problem trying to convert those types of goods into whatever currency is needed to keep a roof over your family's heads.

 

[singlesix]

so you are with me wondering why Gold etc or not? Or are you simply here to stir the pot w/o taking a side?

In any case, food shelter and water not in that order will be the stuff in the biggest demand for the length of the problems. Rarely will things lacking intrinsic survival value be in demand until the end of those troubles, if it comes in our lifetime, come into view. I freely admit that once those things become worthwhile will be never if things don't come to an end and "order" is restored. Personally I think when the bottom falls out, and that is certainly coming, they will not be resolved in any type of short term. When things DO start getting back to "normal" though is a different beast altogether.

If you believe we'll have a big economic collapse than gold and gems are good, if on the other hand you believe the world will go Mad Max Thunderdome than beans and bullets makes sense. Hoard what you think best. I know people who hoard .22s because they believe it will be the new currency in Mad Max World.

 

[skulhedface]

"Mises showed, as far back as 1912, that since no one will accept any entity as money unless it had been demanded and exchanged earlier, we must therefore logically go back (regress) to the first day when a commodity became used as money, a medium of exchange. Since by definition the commodity could not have been used as money before that first day, it could only be demanded because it had been used as a nonmonetary commodity, and therefore had a preexisting price, even in the era before it began to be used as a medium. In other words, for any commodity to become used as money, it must have originated as a commodity valued for some nonmonetary purpose, so that it had a stable demand and price before it began to be used as a medium of exchange. In short, money cannot be created out of thin air, by social contract, or by issuing paper tickets with new names on them. Money has to originate as a valuable nonmonetary commodity. In practice, precious metals such as gold or silver, metals in stable and high demand per unit weight, have won out over all other commodities as moneys. Hence, Mises' regression theorem demonstrates that money must originate as a useful nonmonetary commodity on the free market." - Murray Rothbard

The Case for Genuine Gold Dollar


What Has Government Done to Our Money? by Murray N. Rothbard

And I'm now done with this thread.

Guess Mises never heard of bitcoin

I don't see any usefulness for stocking gold myself, but I do invest in it occasionally.

 

[indiucky]

I buy gold and silver coins because I like the sound they make when I clink them together.....They are a part of my prepping but they were a part of my life before I ever thought of prepping...

IMHO ofcourse,

Indiucky

 

[Indy317]

I don't prep more than to be able to get through a natural disaster. Beyond this I put myself in the Lord's capable hands.

I want to know something though, why precious metals and gems? You can't eat them and they won't be worth much if the economy collapses. I know if a guy/gal came to barter for a gun or whatever and had gold bars I would tell them to get something good to eat or something that helps me cook or solar panels etc.

Gold/Silver would not fit this bill for me. All it is at this point is pretty. My money is better spent on food storage etc IMO so help me on this one.

In a total collapse, nothing is really worth much. Even if you had food and such, you would likely be on constant battle from people trying to take it from you, especially if one lived in or close to any city of 20K+ people. Large metro areas, forget about surviving by hunkering down, I don't care how many rounds one has stored away. Surviving a true total collapse would likely be impossible unless one lived in a very hard to reach rural area (think Montana, Wyoming, or Alaska), no one know you were there, you had plenty of wood for heat and cooking, and plenty of food to eat. And then you would likely only really have it "easy" if the situation eventually calmed down after a few months.

With that in mind, precious metals are about storage of wealth during times when there is still some sort of an economy that likely isn't based on the collapsed system but above the barter only system. If there is business being conducted in any sort of town square setting, then I don't really consider that a collapse. Even if there are stabbings, robberies, etc. and a lot more general lawlessness from time to time, if overall things run as smooth as can be expected, then that is where gold and silver would come into play down the road. Eventually human history tells us some form of government and economy would be forthcoming. Might take a few months, a few years, or a few decades. Usually after such a situation, you would more likely see people want some sort of backing with whatever currency comes into play. I believe that gold and silver will be that backing. This is where a person who stored away $10K of today's wealth in gold or silver could easily see that become worth 10x or more. Possibly instant millionaire status. $10K isn't all that much of an investment. Might it be better spent on solar panels, fuel storage, cabin in the woods...possibly, but even all those have risk as well. Someone could destroy the solar panels with small arms fire, target you for fuel, and put you under siege in the bug-out cabin.

 

[snorko]

I buy gold and silver coins because I like the sound they make when I clink them together

Hehe, Scrooge McIndiuky

 

[snapping turtle]

I remember the first person who ever showed me a bug out bag. The brother of a girl I dated and quite the storybook person.
A BoB was just to run from the law or an angry husband. He had hide out places and stashes. He carried lots of cash at all times. Always filled up the car everyday. He bought and sold everything he could make a dime on. He saved gold/silver and gems as he had no real bank account. He was an outlier for sure. Paranoid as a cat in a room full or rocking chairs. After he died his sister and I found tons of items he had stashed. Cash in books, guns under tables duck taped. He was not what we here on INGO would call a proper person. He also had a stash of survival books many of which I have or had. They seemed to be written for outliers like himself. Early stuff seemed to be written for the outlaw and the same stuff has just been toned down today for public consumption.

those books said gold was for hording as it cannot be traced and is easy to convert into cash and does not degrade can be melted from jewelry into clumps and survives direct burial.
Silver was hyped big time on the fact that at times people make a run on the market. This was the late 1970 and a group did try to corner the silver market.
quality gems were hyped biggest as the were easy to transport in high volume with the largest weight size to cash flow.
Bars and restaurants were hyped as basically easy places to lander money. These books were written as a way to get around laws and survive on the lamb from the law. Now we have the internet. Then we had books.

So when BOB or Prepping comes around here I still think back to who I saw doing this early in my life. Bikers, dealers, fringe anti-gov Bigfoot/alien watchers and a few back to nature guys. Things have changed now. Normal people prep. I prep.

Gold is to hold off inflation.
silver is for making photographs
gems are for transport of riches long distances without detection.

 

[warthog]

In a total collapse, food and potable water will be worth a lot to those who are hungry and thirsty. A BOB is something for the short term, something made for getting out of Dadge and isn't what we are talking here. I am speaking to long term prepping. IMO Gold has no place to total collapse long term prepping.

For the record, I like the sound the metals make clinking together, especially silver. It's almost musical while gold sort of clunks. Platinum also makes a nice sound. I haven't always been strapped. I had a good job and good income and I INVESTED in precious metals to make my wealth last as long as I was able. Disability sometimes comes out of nowhere so it is hard to prep for everything. All you can do is try to do the best you can.

Not all of these things brought up are pertinent. Looking at the way our dear leader is going, the world may well see a total collapse of the money system. This seems to be his goal too. Chaos seems to be his ultimate wish and he wants us disarmed for it so he can become our Tyrant. He may not have the time to do all of this but the next Liberal in line for the office will.

 

[Justus]

Disability sometimes comes out of nowhere so it is hard to prep for everything.

THIS ^^^^^

Loss of income, Under-employment, long-term injury, power outages and snow storms have already happened to me so they are real.
To me, it's clear that there is more of the same heading our way so that's how we prep.
This level of prepping is enough of a challenge and if anyone can say that they are really and truly prepped for everything that we KNOW can happen in everyday life, my hat is off to them.

PMs are a safe prep. They have a relatively stable value AND there are shops in almost every town that are in the business of buying and selling them at a known price, even in the worst of economies.


IMO: Bartertown, Mad Max, Day of the Dead stuff is fantasy.
It would take an extreme continental event to knock the entire global economy into a condition in which bartering would become a means of survival.
If the day comes when a sudden global smackdown does happen, I'm pretty sure we'll either be killed or we'd be refugees quickly separated from our preps.

 

[Fletch]

As long as there are people, there will be trade, and the need for "money" as a store of value grows exponentially with the number of different items being traded.

If the only two items being traded are food and ammo (and those two things being completely homogenous, which is already ignoring reality), then it's reasonable to say that money is useless. Every additional item being traded adds exponentially to the need for money to be used to facilitate trade.