Where do precious metals fit in with your preps?
I’ve been considering buying some gold or silver to protect myself a little against the collapse of the dollar and other economical downturns.
Do any of you have physical gold or silver as part of your preps? How much and in what sizes do you recommend? When and how do you think gold and silver will be used as a type of currency?
dns - April 9, 2021
I have a few ounces of silver, but there’s some articles about various government/currency collapses that make me think some other items may be equally or more valuable. In Russia they started using American dollars, British pounds, or vodka . I know having a pack of cigarettes would be pretty useful for bartering . Things tend to revert back to commodity money , or basically prison currency , and any item in your preps could potentially very valuable to someone who doesn’t have it.
But I’d think if there’s some kind of large exchange (say, I want your boat) having gold may be easier to deal with than dozens of cartons of cigarettes.
Paulino Martin - April 10, 2021
dns, you make some good points that I’ve seen from other preppers. The common saying is – You can’t eat gold. Or from your links, you can’t smoke gold. ha.
I’m not a smoker, but maybe might consider stocking some cigarettes for barter. Vodka could be an even more useful barter item because it could be burned, turned into a molotov cocktail, used to sanitize and clean, or drink.
Bob - April 10, 2021
Good morning Paulino,
No, precious metals are not part of my preps. At the private citizen level, economic downturns and severe dollar inflation don’t derive benefits from precious metals and gemstones.
There is a cost to possessing the above-pictured metals. A major cost is security. If the $US dollar hyperinflates, physical security will be lessened also. We have COGCONS – Continuity of Government Conditions. The national response is to “push out” food and water” to the population.
During WWII, big trading items were food, medicines and skills like land navigation.
Paulino Martin - April 10, 2021
Food is always going to be one of the number one preps. The average person just doesn’t have the skills or resources to produce their own food so most will rely on others.
Josh CentersContributor - April 12, 2021
Precious metals have two roles in prepping:
- To diversify your investments in case of an economic meltdown. For instance, if you owned a lot of gold in 2008, you had a much better year than most people.
- As a possible form of currency post TEOTWAWKI.
Silver has also done really well over the past year. American Silver Eagles were pegged at $20 for years and now they go for about $30. Of course, the problem with physical metal is that it’s heavy and it’s not the easiest thing to trade.
I think it’s good to own some, but it’s pretty low priority.
AT - April 13, 2021
About a year ago I read on a Bogleheads forum that the best way to view precious metals is not as an investment but as an insurance policy. That was the first justification I’d heard that made since to me. I started buying 1 ounce silver bars and coins in small quantities in the low probability that if everything else was worthless, it might still have some value. Since then demand for these items has skyrocketed, availability is down, and the premium over spot is ridiculous so I stopped and will re-evaluate if/when the hysteria settles down.
In the book Selco Begovic wrote about his experiences in the Bosnian War he implied that having precious metals just marks you as a good person to rob. If I had the desire and space to store something for use as ‘currency’ in an apocalyptic future I would probably stockpile 12v solar panels and small charge controllers, or something else with utility. To hedge against inflation I like TIPS and I Bonds. For USD devaluation I consider international index funds to be a good way to indirectly store some value in other currencies.
Robert LarsonContributor - April 13, 2021
Every four months or so I print out the silver and gold price chart from Silverprice.org and stick it in with my stash. I also have a little write up of how much silver is in each pre 1964 dime, quarter, and half dollar. If I ever get to the point of needing to use these as barter items, the internet is probably down, and while I doubt whoever I’m bartering with will care about the price history in say January of 2021, its something to go off of and better than nothing I suppose.
I agree with what AT said, stockpiling some solar panels and charge controllers will make you the 2nd wealthiest person in your neighborhood, just behind the guy with 10 years of food storage.
Bob - April 13, 2021
Real good post … Precious metals are like an insurance and not an investment … the metals don’t even earn – remember that term in our history: interest ?!
Had believed Josh was using the terms as synonyms (actually: risk management).
I was a NATO contractor in the former Yugoslavia during war.
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