SHTF Hypothetical

[sixgun]

15 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?    

Silver is silver. i think if you are in America the best silver to have in this sort of situation is the ASE. It is recognised as silver. i do not think most people will accept it b/c most people are ignorant but i am sure enough people will understand and take your silver in exchange.

[spanit]

The bullions which are widely known will be acceptable in exchange e.g. American silver eagle, Canadian silver maple leaf, UK silver britannia, Chinese Panda, Australian Kangaroo.

People recognize them as they are genuine silver and known metal content. 

[silenceissilver]

On 11/01/2019 at 18:00, 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?  

No, I dont think so at all. The PM content (and recognisability) is everything that counts. There won't be political bias against government coins, even when a government is universally hated. Have Roman coins not been used after the collapse of the Roman empire? Less so of course but many coins had scratched off their edges and had been less and less made of precious metals for a long time.

[silenceissilver]

I still stick to my first reply.

 

[lbachir2000]

On 12/01/2019 at 11:30, Oldun said:

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.FMovies YesMovies SolarMovie

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.

Garbage or government silver as an exchange thing, in the event that individuals can test the metal, yes? It's simply silver. In any case, in all actuality from past shtf it's things like cigarette lighters, sustenance, espresso, prescription, those sort of things that are valuable and turned into the premise of deal exchange. Metals speak to a store of significant worth as opposed to having any helpful esteem themselves, and in shtf, individuals need valuable stuff at this moment, not later on.

[watchesandwhisky]

On 12/01/2019 at 10:30, Oldun said:

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.

Theres one american lady who goes on non stop cruises because its cheaper than a care home - after knowing the bill for my late grandads care i can see this is very possible! 

[NewMSmatist15]

On 11/01/2019 at 16:20, 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.

This is a very interesting statement. Let's say I agree with your premise. As it relates to the topic of how specie is treated in a SHTF situation: which would I more likely accept for goods or services without a centralized government - the currency of that now defunct government in fiat or some form of bullion or silver currency of that same government?

My guess is this based on what people have done with civil wars, famine, and epidemics that displace people and destroy governments...

1. There will be a heavy reliance on trade and barter regardless.

2. If a medium of exchange is needed it will either be something universally accepted as valuable that is non-monetary (think prisoners using cigarettes or WWII soldiers using coffee and chocolate bars) or the nearest fiat currency that is stable (like some African nations have done turning to the Euro or the US Dollar).

I highly doubt a silver round is ever going to be used in a situation where there is no centralized government or banks anywhere. In fact, the reliance on silver or gold is in case your own fiat currency fails NOT that every other currency has failed. 

Hear me out on this - Country A uses dollars and Country B uses dineros. Country B suffers from a civil war and dineros become worthless. Country B citizens that have stores of gold and silver sell it somehow and receive Country A dollars that they can then use to purchase goods and services. If the world only consisted of Country A and Country B and BOTH governments failed and both fiat currencies were worthless, what would the value of silver be? Nothing. You can't eat it, you can't use it as ammunition unless you process it, and anything you could use it for has a substitute that is more accessible and plentiful. 

I say to gather silver and gold is to rely on ANOTHER country to have a fiat currency that will be stable and used.

[sixgun]

The purpose of my comment here was that a number of members think that the USD or GBP (or whatever government/central bank paper it is under consideration) will not become worthless. This i expect is normalcy bias. This definition is set in the impeding crisis situation, where the person exhibiting normalcy bias doesn't see the impeding crisis based on the fact there hasn't been one before.

i would expand the definition before that of impeding crisis, in a more settled situation. It requires a bit more imagination and extrapolation. As i pointed out every fiat currency has collapse - they get abused and they become worthless. There are 100's of examples. We have seen the USD dwindle to the last 2% of its value since 1913. We have seen Sterling dwindle even further. The evidence is there staring us in the face and yet despite the evidence it is denied.

As i say 100's if not 1000's of fiat currency systems have collapsed. Since 1971 the world has run on a pure fiat system. So currencies have collapsed. Silver has been around. Silver is silver. What is an ounce of silver worth when there is no currencies around (b/c they have collapsed)? Well certainly it isn't nothing as you suggest. An ounce of silver is  worth an ounce of silver for starters. Then it is worth what other people view it as being worth, a sack of flour, a can of gasoline, a coat. Items are priced in fiat, so they can be priced in ounces of gold and silver. If there were no dollars to think in terms of you would value by and think in terms of something else.

[KDave]

2 hours ago, NewMSmatist15 said:

What would the value of silver be? Nothing.

Silver would be worth what someone would pay for it. People only want units of currency because that is how they are forced to pay their taxes. No one is forced to buy silver so why do they. Why people value silver will not disappear following a currency collapse. 

[Michal]

Just remember it will be a SHIFT not complete collapse. We had loads of such shifts in history and outcome always was new governments and new money. This time it will be rather digital cos of number of people on earth but gold and silver will remain as precious things in humans mind. It always was safe haven and we ll always value it.

DIGRESSION

Remember that silver can be use for scatter of clouds, worth to remember that when it get too hot at ours sun house called earth 

[NewMSmatist15]

On 16/01/2019 at 15:02, KDave said:

Silver would be worth what someone would pay for it. People only want units of currency because that is how they are forced to pay their taxes. No one is forced to buy silver so why do they. Why people value silver will not disappear following a currency collapse. 

In the described situation silver is valueless in a crisis (has no practical use for survival) and unless it is being turned into another currency its value is based off of another country's fiat money. People buy silver because of the latter. It can be sold for what we use as money. 

To put it differently, a share of Amazon stock is valueless in a crisis. It is worth what someone is willing to pay for it as you say, but its worth is derived from turning that item into a currency so the currency can then be used to buy goods and services. A chunk of silver and a share of Amazon stock are equally valuable or valueless depending on the crisis. People invest in silver hoping they will get many units of the currency they will be turning silver into compared to how many units of a currency they paid for it.

As an aside, silver has an industrial value with electronics or even used in medicine to some extent, but if I'm locked away in a bunker somewhere trying to stay alive I probably won't need silver for either of these things.

[Mcgrimes]

@NewMSmatist15 I agree with your comments. In a SHTF scenario, it really does depend what hypothetical SHTF. For example, if the world plunged into a nuclear winter; then all PMs would become valueless.

But, if the USD collapsed, then it would be expected that the numerical value of PMs (in USD), and many other assets, would skyrocket.

PMs are viewed as a store of wealth; this store of wealth works well in an inflationary environment. 

[KDave]

Perhaps look at it this way, as value and wealth. As you say, anything 'useful' be it food, water, houses, cars, gold and silver - we can call those wealth. If you are hungry in SHTF you don't want silver but you might want food. That doesn't change the nature of cars houses or gold.

Amazon stock is a claim on the future output of amazon as a company. If output increases (and perception that this output will continue to increase) then you can expect to exchange your stock for more currency units than you paid for it in the first place. Amazon stock has value but it is not wealth.

Currency is an extremely effective mechanism for exchange, far more efficient than barter. But you are not giving away anything inherently useful to you (other than its utility for exchange) when you buy something with currency. Currency is a claim on wealth. You are giving away claims on wealth in exchange for actual wealth when you buy something. 

Silver and anything real is wealth. Silver is ultimately an element that has characteristics that allow to serve reasonably well as an exchange mechanism, and it has industrial applications, and medical applications, ect. It has been used as a reasonably effective exchange mechanism in history but currency does it far better. For some reason unknown to me, humanity has decided to value these 'monetary' attributes of the metals along side the industrial applications (or in the case of gold, far in excess of its industrial utility) for most of history and up until this day. This may change but the track record is quite good going on several thousand years if you believe it. What were the monetary attributes or utility of Amazon stock 50 years ago? 

Value changes based on many things including what is going on outside ones bunker. That doesn't change the nature of any of the items mentioned, but it might change your saving strategy if planning for SHTF. I agree that silver would not be a good first choice when stocking up the bunker. 

[Michal]

Coming collapse is NOT end of the world it will be SHIFT of financial dogma which we have right now. People will lose faith in fiat as they did several times in history and turn back to things which worked properly before.