SHTF Hypothetical

[SilverSkoobz]

I have been collecting silver and gold for a few years now and I would never put down a single person who wants to grow their wealth with metals.  I am curious, for those on the forum who stack for a SHTF situation:  If we suffer a massive economic collapse (like in Venezuela) how do you think your silver's value will be effected by peoples feelings on the government?  Do you believe that people's views on the government will effect how they view and value government backed money like silver eagles, junk silver etc?  

[Martlet]

Normal chap in the street doesn't view the currency as "government backed", it takes fundamental change in economic outlook for currency to collapse, preceded by a period of high inflation or other economic portents of doom.  See 2008, bank crisis, recession, no actual collapse.

[5huggy]

17 minutes ago, Martlet said:

See 2008, bank crisis, recession, no actual collapse.

The Powers that be (central banks/ governments et al) had the firepower in 2008 to "delay" what is becoming an even larger "INEVITABILITY" due to the increasing indebtedness of countries

It can only eventually end in tears somehow / somewhere/ for some people - 

Just look at this mess - - - >>>  http://www.usdebtclock.org/world-debt-clock.html

 

[4Nines7Hills]

I think looking at what's happening in  Venezuela is a good way to judge what would happen in a situation like Venezuela inflation in Venezuela for the past year is 1.3million percent.

 

Gold has faired well note this article is significantly older than the inflation rate figure I couldn't find any closer comparison data. 

[StackerNoob]

Hyperinflation requires central banks to print new money into oblivion. If all the QE money finally trickles into the real economy we might get very high inflation but not hyperinflation, not yet. Sterling will be one of the last surviving fiat currencies IMO

[Martlet]

28 minutes ago, 4Nines7Hills said:

I think looking at what's happening in  Venezuela is a good way to judge what would happen in a situation like Venezuela inflation in Venezuela for the past year is 1.3million percent.

The example of Venezuela is how to run an economy into the ground through socialism, failing to accept its not working, turning to totalitarianism to cling on to power.   They even managed to make their oil industry become unprofitable.  I dont see such poor economic mis-management from even the most left wing European nation. 

26 minutes ago, StackerNoob said:

Hyperinflation requires central banks to print new money into oblivion. If all the QE money finally trickles into the real economy we might get very high inflation but not hyperinflation, not yet. Sterling will be one of the last surviving fiat currencies IMO

QE doesn't go direct through to the real economy, the purpose is to create liquidity and reduce returns from government bonds in order to spur investment elsewhere. Crucially, it is reversible, by reselling bonds if need be.  That is why it is not the same as simply printing money.

[4Nines7Hills]

12 minutes ago, Martlet said:

The example of Venezuela is how to run an economy into the ground through socialism, failing to accept its not working, turning to totalitarianism to cling on to power.   They even managed to make their oil industry become unprofitable.  I dont see such poor economic mis-management from even the most left wing European nation. 

 

Youre right  on both counts but the  the reasons why is semi irrelevant.  Other currencies and in particular the  euro  is likely to end in a SHTF situation just the same as Venezuela currency.

[sixgun]

Every single fiat currency bar none has collapsed. Every single one, every single time.

A definition of insanity is doing the same thing in the same way and expecting different results. So why do people believe it won't happen again?

It's called 'normalcy bias'. It causes people to underestimate both the likelihood of a disaster and its possible effects, because people believe that things will always function the way things normally have functioned.

[flim]

3 hours ago, Martlet said:

The example of Venezuela is how to run an economy into the ground through socialism, failing to accept its not working, turning to totalitarianism to cling on to power.   They even managed to make their oil industry become unprofitable.  I dont see such poor economic mis-management from even the most left wing European nation. 

QE doesn't go direct through to the real economy, the purpose is to create liquidity and reduce returns from government bonds in order to spur investment elsewhere. Crucially, it is reversible, by reselling bonds if need be.  That is why it is not the same as simply printing money.

not to mentioned the economic sanctions that had been put on them by the US

when a small country is being sanction by the US, their economic life line is being cut from the world

we have seen many, so long as their leader are willing to accept bribes, then the sanctions are lifted

[sixgun]

5 minutes ago, flim said:

not to mentioned the economic sanctions that had been put on them by the US

when a small country is being sanction by the US, their economic life line is being cut from the world

we have seen many, so long as their leader are willing to accept bribes, then the sanctions are lifted

The poor state of Venezuela is blamed on Socialism - it is not the real reason. The usual suspects want a compliant regime, they want the oil and if they can't get it they want regime change. They can't get this so we see US sanctions, economic sabotage and political subversion. The same old same old tried and tested economic hit job.

[5huggy]

4 hours ago, Martlet said:

QE doesn't go direct through to the real economy, the purpose is to create liquidity and reduce returns from government bonds in order to spur investment elsewhere. Crucially, it is reversible, by reselling bonds if need be.  That is why it is not the same as simply printing money.

Yep - Smoke and mirror's game the PTB pull to drag in unsuspecting "JOE" public - - sheer them regularly!

[5huggy]

1 minute ago, sixgun said:

The poor state of Venezuela is blamed on Socialism - it is not the real reason. The usual suspects want a compliant regime, they want the oil and if they can't get it they want regime change. They can't get this so we see US sanctions, economic sabotage and political subversion. The same old same old tried and tested economic hit job.

Agree entirely @sixgun 

[5huggy]

3 hours ago, sixgun said:

A definition of insanity is doing the same thing in the same way and expecting different results. So why do people believe it won't happen again?

OMG - - - - >> I quote that regularly at work and the "Lunatics " unfortunately, still run the asylum!  but SO gawd damn right! 

[5huggy]

The classic to previous is  - - - >> "the/they  government wouldn't let that happen"

THEY AREN'T going to tell you its "FUBAR" until they have sorted themselves and buddies first! just like 2007/8  ONLY this time is likely to be a damn site worse IMHO

PS - - Fu$%^

up 

BEYOND all

recognition!!

[Bimetallic]

7 hours ago, SilverSkoobz said:

I have been collecting silver and gold for a few years now and I would never put down a single person who wants to grow their wealth with metals.  I am curious, for those on the forum who stack for a SHTF situation:  If we suffer a massive economic collapse (like in Venezuela) how do you think your silver's value will be effected by peoples feelings on the government?  Do you believe that people's views on the government will effect how they view and value government backed money like silver eagles, junk silver etc?  

I doubt it would affect people's view of government-minted silver. That assumes they know anything about silver and precious metals. Most people don't care about it enough to buy any, so silver and gold won't be very useful in a SHTF situation – hardly anyone has any of these metals, so they wouldn't be currencies after a collapse. The closest things to currencies would be clean water, water filters, food, pharmaceuticals, ammunition, fuel, generating equipment, etc.

People might even fall back on paper money, like they did in Puerto Rico and also in Iraq with the Iraqi-Swiss Dinar. On the latter, see Selgin's paper on Synthetic Commodity Money.

[sixgun]

2 minutes ago, Bimetallic said:

I doubt it would affect people's view of government-minted silver. That assumes they know anything about silver and precious metals. Most people don't care about it enough to buy any, so silver and gold won't be very useful in a SHTF situation – hardly anyone has any of these metals, so they wouldn't be currencies after a collapse. The closest things to currencies would be clean water, water filters, food, pharmaceuticals, ammunition, fuel, generating equipment, etc.

People might even fall back on paper money, like they did in Puerto Rico and also in Iraq with the Iraqi-Swiss Dinar. On the latter, see Selgin's paper on Synthetic Commodity Money.

Yes if you think there will be a total collapse you need a store of food and water - basic pharmaceuticals - fuel - sanitary stuff/toilet paper (good to trade) - alcohol and cigarettes (good to trade) - ammo for common guns/rifles - good to trade. Have stuff people will need so you can trade these for stuff you would like. Have what you need. Then keep it safe and dry - don't tell people or you will be robbed. i hear from those preparing for global cooling FIVE years of food and TEN years of seeds.

[SilverSkoobz]

5 hours ago, sixgun said:

Every single fiat currency bar none has collapsed. Every single one, every single time.

A definition of insanity is doing the same thing in the same way and expecting different results. So why do people believe it won't happen again?

It's called 'normalcy bias'. It causes people to underestimate both the likelihood of a disaster and its possible effects, because people believe that things will always function the way  things normally have functioned.

The collapse of a currency is inevitable as history has shown but I'm more interested in what people would think after the collapse.  If I wanted to give someone a tube of ASE's that say "United States of America" on it would most people accept it or would they not see the value of the metal and only see an "old" currency and thus the value plummets?    

[spanit]

I think of one scenario that all fiat collapse together, exchange rate among them look normal, strong or weak relatively. 

All central banks have to work together to provide soft landing of this collapse. Precious metals quoted in fiat currency will rise.

It means all fiat were revalued against the real money metal. All central banks move to buy and the precious metals still go up to

the level that the central banks have more room to print more fiat. Moving to cashless society will give more control in case of bank run.

Digital fiat is coming to be ready for this SHTF event.

[KDave]

Junk or government silver as a trade item, if people can test the metal then yes? It's just silver. But in reality from past shtf it's things like cigarette lighters, food, coffee, medicine, those kind of things that are useful and become the basis of barter trade. Metals represent a store of value rather than having any useful value themselves, and in shtf, people want useful stuff right now, not in the future.

[Martlet]

8 hours ago, flim said:

not to mentioned the economic sanctions that had been put on them by the US

when a small country is being sanction by the US, their economic life line is being cut from the world

we have seen many, so long as their leader are willing to accept bribes, then the sanctions are lifted

Other countries with sanctions seem to fair better, there are ways around.  The first came along after the economy was declining and the harsher sanctions only last year.  They have run their economy in to the ground well before that by their policy.  

[Oldun]

I propose that we will be going into asset deflation from here on in. Therefore it is not about a number but what something is in relation to something else. If more people need to sell an asset to pay for something else than those wishing to buy, that asset will go down in price...add higher taxes, job losses, reduced wages in real terms, medical costs and pensions that could be cut in half, and suddenly housing looks dodgy.....or at least large houses as people look to sell and downsize to live off the difference.....but who will buy these houses ? Small compact properties should do well while rents will continue to see large increases.

You may even see a return to the Fawlty Tower days when retired people (The major and the two old ladies)  became residents of b and b hotels as it was a cheaper (no utilities to pay) more sociable and safer way to spend their twilight days rather than rattling around in a lonely house.

[flim]

2 hours ago, Martlet said:

Other countries with sanctions seem to fair better, there are ways around.  The first came along after the economy was declining and the harsher sanctions only last year.  They have run their economy in to the ground well before that by their policy.  

“The blatant policy of Washington, which aims at an unconstitutional formation of alternative structures of government in Venezuela, is an attack open to that country’s sovereignty,” the Russian Foreign Ministry said in a statement.

https://www.fort-russ.com/2019/01/as-us-plans-with-puppets-to-destroy-venezuela-russia-confirms-strong-support-for-maduro/?utm_medium=ppc&utm_source=wp&utm_campaign=push&utm_content=new-article

[4Nines7Hills]

Russia would say that didn't necessarily mean it's right .

 

Also there is doubts into how legal the last vote was in Venezuela with bribery vote rigging etc. 

[STONE]

12 hours ago, SilverSkoobz said:

The collapse of a currency is inevitable as history has shown but I'm more interested in what people would think after the collapse.  If I wanted to give someone a tube of ASE's that say "United States of America" on it would most people accept it or would they not see the value of the metal and only see an "old" currency and thus the value plummets?    

 

I see what your saying but silvers value is already within its self. "It is" money. Its barter ability has been proven throughout history. If I have 5 loaves of bread and you have silver to trade for it, the value will be established between you and me. We will find common ground when both party's feel that they are getting a good deal in the transaction. An ASE doesn't have its derived confidence of value based on "who" minted it but on the fact that its value is within itself just as a loaf of bread has value because someone needs it. Currently the USD is utterly worthless since there is nothing of "value" backing it. The reason it still works as a trade vessel is because of the "perceived confidence" in its value. People believe that if they receive a dollar they can turn around and use it again to trade for something else. When reality sets in and it takes thousands of those dollars to buy a loaf of bread people will not trade for them and will seek out a new form of currency. In a SHTF scenario, value will be placed on items that are necessary to survive or the trade ability in an item to be able to get what one needs. Whether its silver/gold, bread, toilet paper, ammo it doesn't matter because value is placed on an item based on necessity. Will there be people that don't understand the actual value of PM's in a SHTF scenario? Yes, but they will catch on quickly if they want to survive. Right now is an amazing time for silver, the fact that I can take something that has no value(FRN's) and trade it for something that is value(PM"s) is the deal of a lifetime. I don't compare the price of silver in dollars, its just a trade. Fake money for real money! Hell yeah! If you want to see silver and gold's real value based on FRN's have a look at the US debt clock, lower right hand corner. Silver is $598 and gold is $4796. There is a reason JP Morgan, Russia, China and many other big players are stacking precious metals hand over fist. They know the current monetary Ponzi scheme is cracking at the seams and at the end of the day the only real store of wealth is precious metals...

[AppleZippoandMetronome]

22 hours ago, SilverSkoobz said:

Do you believe that people's views on the government will effect how they view and value government backed money like silver eagles, junk silver etc?  

In your hypothetical scenario I don't think it will matter at all and I say that with some confidence because I don't think it even matters now. Does anyone buy those coins because they have a love of the government/country that issued them in the first place? People buy country bullion coins and especially junk silver because it is often the cheapest way to buy weight. What is on that coin doesn't really matter (except in cases where certain coins are bought due to visual preference). What is on the coin is already pretty irrelevant. When was the last time you paid 1 US$ for a silver eagle or $5 CDN for a maple or £2 for a Britannia? The only thing that matters where any of those coins are concerned is the value of the silver contained within them. I don't see that changing in your scenario.