A common theme in the survivalist community is that post-TEOTWAWKI gold, and especially silver, will quickly become prominent forms of currency. This notion is propagated by popular survivalists as well as a good portion of survival fiction. Usually the focus is on pre-1965 U.S. silver coins, which are 90% silver, with gold being reserved for really big purchases such as property or perhaps bribes (e.g., buying passage out of a dangerous area).
Some also call for stockpiling current U.S. nickels since the metal value is worth more than face value, and at least one survivalists blogger recommended stocking up on U.S. copper pennies (not the current mostly zinc circulation) to make change for silver coinage after TSHTF.
I’m not saying these metals will be useless, but I’ve come to the conclusion that their value post-TEOTWAWKI has been grossly overestimated, at least soon after full collapse. A few others agree with this line of thought.
While gold and silver have been valued as far back as we’ve recorded history and almost surely will retain value in the future, timing is everything. A few scenarios;
- Fast Collapse: Whatever the reason – EMP, super pandemic, etc. – after a fast collapse I don’t think either gold or silver will be worth much. People may still loot and hoard it, but I just don’t see most people wanting to sell a weapon or food for a gold coin or many silver ones. In such a situation food, security, weapons, ammunition, and other practical things will be worth far more. This scenario means a large die off in the U.S., perhaps 60-80% or more. A year after the crash, gold and silver jewelry (and coins) will be laying around empty homes for looters and scavengers to take; I’m not promoting the idea, just pointing out the obvious. There will be no logical reason to want nickel, and copper wiring and pipes in building the dead don’t use will make copper pennies worthless as well. In the aftermath of a fast collapse, precious metals are not needed.
- Slow Collapse: In my opinion, a collapse may start out slow in America but will eventually trigger a fast one – there will be no Kunstler-type slow collapse, it’s just not feasible. But that’s a topic for another post. At any rate, a slow collapse, unlike the fast one, probably would provide those with gold and silver the opportunity to cash in if they do so in time, and change those precious metals for many more goods, property, and so on that they might buy today. Gold and silver can act as a hedge against inflation. While the markets still exits it would also be a good time to cash in on any nickel or copper that’s been stockpiled. But once the breaking point is reached, a fast collapse is likely to begin and the value will be lost for some time.
- Recovery: Gold and silver have been world currencies for as long as trade has existed and this is where gold and silver will start to see their value again – when society and civilization begin to reform and barter commerce starts getting impractical. I don’t think this will happen quickly as some predict, it will need to wait for some sort of recovery, even if localized. The exception might be those who are well prepared now with vast stockpiles of barter goods, who barter for precious metals in expectation of the new market to eventually emerge (though I wonder how much of that trade would be in the jewelry of the dead). In a total, hard collapse (EMP, world financial collapse, etc.), I doubt recovery could occur before the excess population – the portion that cannot be fed – dies off, or at least a year.
Like anything else, I could be completely wrong. But I don’t think so – the logic behind a gold and silver market during TEOTWAWKI is just not sound. Before, if the timing is right and long after, but not during.
So, should you have any gold or silver? If you have excess income and all your other preps are in place, why not, it can’t hurt. Someone in that position could take advantage of the likely precious metals prices increases in the next few years and during a slow collapse (which are probably the same thing) to obtain an even more advantageous position for when the big collapse comes. Again, these metals can act as a hedge during inflation. If a fast collapse occurs, however, you won’t be able to cash in for many months, or perhaps more likely years, but again no big loss if all other preps are in place.
If you’re struggling to get squared away like most people, I would skip the precious metals, especially gold. If you feel you must, purchase a few silver dollars, quarters, and dimes, but don’t break the bank. A little may go a long way in a world where the vast majority have no silver coins. Secure more important items first, like a years worth of food, the survival weapons right for you, other items for your retreat, equipping your BoV, and so on.
Look at it like this; you can purchase a brick of U.S. manufactured bulk .22 LR ammunition (550 rounds) at Wal-Mart for about the same price as an American Silver Eagle dollar. If you purchased one of these items a month, after a year you’d have either 12 silver dollars, or 6,600 rounds of ammunition; what do you think will be worth more when our fragile civilization finally gives way?
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