Author Topic: reality of silver coins for bartering in SHTF?  (Read 12314 times)

tash

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reality of silver coins for bartering in SHTF?
« on: September 22, 2008, 02:54:23 PM »
This is not a question about silver as a financial diversification asset rather it is intended as a question regarding bartering in SHTF terms.

Almost every forum, movie, story or book I read/watch that revolves around SHTF inevitably shows someone using silver coins as barter items.

So here's the question I keep coming back to when I think about silver in terms of bartering for SHTF. Everyone seems to think that pre-1964 dimes, for example, will be a great barter item and in almost every circumstance it seems the person with whom they are dealing with will know the intrinsic 'value' of the pre-1964 dime. So I guess my question is, how realistic is junk silver coins for a barter item when most of the country doesn't know that these dimes are 90% silver to begin with? Why is silver so important to preparedness when everyone else doesn't realize it's as important as we think it is?

For example, I know that everyone and their brother or sister knows that gold and silver are important metals. But let's say the SHTF and we are now at a time where we have local swap meet every Sunday where individuals would trade things of worth like canned food, fresh eggs, vegetables, chickens, whatever. I just can't imagine that every Tom, Dick and Harry would know that 1 dollars worth of pre-1964 dimes could buy his entire stand. I just can't see that. That doesn't make sense to me. Do you think you're neighbor, right now, knows that the melt value of silver is running at 13 and change an ounce at the time of the posting? Best I can fathom is that if most everyone doesn't know the real intrinsic value of silver then we're the ones that are gonna get gypped when we try and use it to barter something and they won't give us enough for the real value of the silver we posses (in the event that we have run out of things and we must buy/trade for it.)

Is this idea of silver coins as the ultimate barter metal something that has been driven into us. Like the white chalk line that is drawn in the shape of the dead body? The chalk line wasn't real and never happened but since we see it all the time we begin to believe that it's common practice.

Yes, I know that many generations have used silver and gold as a barter item. It happened and I do not disagree with that. I just think that in this modern time that we're having too much of a throw back to the old times were this was common practice and putting this ideal on today's society is a huge stretch. I hate to say it, but this is giving our entire society a hell of a lot of credit. We are so removed from that former life style I just can't see the link.

If you're reading this, you know that I'm not referring to you. We may be the minority but we are not lemmings.

Sorry for the long post. There are a LOT of thoughts I have had running around my head for quite some time that I just threw into a few paragraphs and I'd like to get your take on it.

Thanks,
-Tash

Offline ModernSurvival

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Re: reality of silver coins for bartering in SHTF?
« Reply #1 on: September 22, 2008, 03:17:26 PM »
You have some good points but let me see what I can do on answering them.

1.  Can you be guaranteed silver is a good barter item?

No, but it sure has worked for most of history.  In any barter the item you have is only worth what the other side feels it is worth.  Yet one thing we do know is silver will be worth money to someone even if it means cashing your silver in for British pounds.  Silver at least the way that I see it and speak about it is for hedging against the decline of the dollar not so much for the total SHTF "Road Warrior" total TEOTWAWKI breakdown.  I don't see that happening at least not in a complete and total it is all gone way people seem to expect.  In 1929 we did not have TEOTWAKNI but it was pretty bad and owning silver would have been a good thing, same in the 70s.

2.  Will others know the value of the pre 65 coins?

No, many won't but you know who does, we do.  SOOOOOOOOOO the people that actually have things stored up will be most likely to know that this form or currency has value.

3.  Will there be "flea markets" taking silver coins?

I doubt it at least in the beginning of a true break down.  That is why silver is ONE SMALL COMPONENT of prepping.  What I recommend and I think most others do as well is perhaps a small box of coins up to perhaps working to have at some point say 1K in face value or at today's prices about 9K invested in silver, that is a LONG TERM goal.  If you save 5K a year in retirement that would be like over 20 years 10K in silver and 200K into normal investments.

I know you said this is only about barter but survival is not only about barter.   It is not even only about the shit hitting the fan for everyone, it is about the shit hitting the fan for you.  That happens for someone every day.  The reason dimes are so highly recommended is they are

Cheap compared to quarters and halfs given there is some numismatic component in these coins
Very small individual pieces of silver easy to parcel out
Won't ever be worth less then a dime

I think the problem is people start thinking an entire barter economy will run on silver.  Not gonna happen it will be food, animals, bullets, crafts, etc and silver.  In a barter economy silver would be used when a equal trade was not found with items on hand. 

In closing someone posted this on Zombie Squad

http://www.usagold.com/gold/coins/kim-thanh.html

I think it says a lot.  Good question and I am really glad you brought it up, I hope people don't think I am saying to change all your investments into silver coins.

Offline Stein

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Re: reality of silver coins for bartering in SHTF?
« Reply #2 on: September 24, 2008, 03:44:15 PM »
I don't worry about it too much as I view silver more as a store of wealth than an emergency barter item.

Think of this though.  Say it did go south in a major way.  Bartering would be the first option, but people can't carry around all their junk everywhere.  Sooner or later, something would pop up to serve as money.  I could teach my five year old how to deal in silver in about 10 minutes.  People would learn.

Offline ModernSurvival

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Re: reality of silver coins for bartering in SHTF?
« Reply #3 on: September 24, 2008, 07:29:55 PM »
I could teach my five year old how to deal in silver in about 10 minutes.  People would learn.

Spot on!  That indeed is the point, if it worked 5000 years ago (and it did) then it will work today.

Offline Stein

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Re: reality of silver coins for bartering in SHTF?
« Reply #4 on: September 24, 2008, 10:16:43 PM »
I could teach my five year old how to deal in silver in about 10 minutes.  People would learn.

Spot on!  That indeed is the point, if it worked 5000 years ago (and it did) then it will work today.

I think the notion is rather strange.  Everybody knows how to use modern coins (ok, most people over the age of 30 anyway).  Prices wouldn't be the same anyway, but I can price things in dollars pre-64 pretty quickly when there is no alternative.

Offline ModernSurvival

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Re: reality of silver coins for bartering in SHTF?
« Reply #5 on: September 25, 2008, 06:33:43 AM »
They will be "worth" a lot more to, quite literally worth their weight in silver. ;)

Offline Tactical Badger

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Re: reality of silver coins for bartering in SHTF?
« Reply #6 on: September 25, 2008, 09:30:12 AM »
I think if it becomes the norm, people will get pretty smart about it pretty dang quick.

Offline steel

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Re: reality of silver coins for bartering in SHTF?
« Reply #7 on: October 05, 2008, 03:45:24 PM »
I seriously doubt we'll ever devolve into some kind of mad max barter society.   A more realistic fear IMO is that we suffer a period of high, maybe hyper, inflation.  Having precious metals in that scenario will at least help preserve some purchasing power that a devalued dollar won't have.

Allerion

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Re: reality of silver coins for bartering in SHTF?
« Reply #8 on: October 06, 2008, 09:54:12 PM »
In a SHTF scenario the three primary categories of "wealth" for bartering will be the same things they are today.

Tobacco  (The carton of marlboro red kings can be exchanged for goods and services in more places on earth than the american dollar).

Alcohol  (Liquor keeps forever and is consumed by the rich and the poor alike.)

Firearms (Weapons and ammunition are more and more valuable the more dire the breakdown becomes.)

Now you know why all three are in one government department.  These will be the three most valuable commodities.  For survival needs food will be just fine for normal barter.  I had the good fortune to grow up in a rural farm community back in the days when people paid us in pigs, pears, apples, etc when they were short on money.  If there is enough food to go around you can expect a reasonable degree of peace and goodwill between people.

If you want to buy something expensive...like perhaps professional medical treatment...you'll need the cigarettes, booze, or guns to get your loved one into an overcrowded hospital.  The same applies to any other goods or services that will have much greater demand than supply.

I LOVE this podcast and agree with 99% of the content.  I give huge credit for recognizing that gold will be nearly useless to acquire things like food.  You'll undoubtedly overpay trying to buy bread with gold.  I cannot honestly say that I believe silver coins will ever be a useful currency in a barter society.  I'd recommend you invest in fruit trees instead, or educate yourself on things like how to repair vehicles and generators or first aid.  The one guy in the community that can repair the generator or set a broken bone won't be allowed to starve. :)  Also keep in mind it has only been about ten years since the advent of the digital camera when silver hit rock bottom cheap and people thought it might lose its status as a precious metal.  I am not a professional financial advisor but I would not buy commodities after they have already run up 300-400% and I would buy stocks when they are down 30%.

The world as I see it. :)

Offline Taylor3006

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Re: reality of silver coins for bartering in SHTF?
« Reply #9 on: November 01, 2008, 07:26:21 PM »
"I give huge credit for recognizing that gold will be nearly useless to acquire things like food.  You'll undoubtedly overpay trying to buy bread with gold.  I cannot honestly say that I believe silver coins will ever be a useful currency in a barter society."

I dunno about this, history says you are wrong. If you are using gold to buy bread then you are very hungry. IMHO barter items like you mentioned (I think toilet paper is a great investment as barter) are absolutely rock solid and precious metals last on your list over everything else to get. A man who has gold coins should probably have put away enough food where he shouldn't have to trade it for bread. Gold and silver (as well as diamonds) got Jews out of Germany to escape the Holocaust. Gold and silver have been used throughout human history even before the advent of writing. Personally I have faith that even if things really go to hell, they will have value. I consider my precious metals not so much a barter item as a method of wealth retention. History seems to agree.

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Re: reality of silver coins for bartering in SHTF?
« Reply #10 on: November 01, 2008, 08:02:42 PM »
Taylor - I have to agree with you.  Gold should be acquired after the other necessary supplies are procured.  Gold is not necessarily a barter item.  Gold will store your wealth until AFTER the storm has passed. 

One of the best things you can do now is LEARN how to barter.  Because we live in a society that in general does not understand how to barter, you will have the advantage.  If the Shcumer does hit the fan, you will be able to get a lot of supplies for a roll of toilet paper! 

Offline Taylor3006

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Re: reality of silver coins for bartering in SHTF?
« Reply #11 on: November 24, 2008, 05:06:32 PM »
"Gold is not necessarily a barter item.  Gold will store your wealth until AFTER the storm has passed. "

I agree with the storing of wealth, it is a great hedge and over the long term it looks great. My gold and silver coins were purchased many years ago when it was fairly inexpensive. Over the years when the prices increased I sold off part of them, waited for the price to come down again and bought. You do this a few times and you end up with free gold/silver. It's a gamble but it worked out for me. As far as gold not being a barter item, not sure I would agree with that. I wonder just how many cigarettes it would cost to get a root canal and crown or to get your appendix removed, or how much booze it would take to get a tractor. Imagine trying to barter a doctor for services with smokes or a Seventh Day Adventist with booze. Imagine your main battle rifle needing repairs you could not do yourself. Gold might be just the thing a gunsmith would take. I do agree that booze, food, and tobacco make great barter items. I am on the fence about bartering guns or ammo though. You wanna make sure that you don't end up on the wrong end of a gun you traded or getting shot with ammo you sold the wrong person. It all depends on the situation. The other advantage of gold is portability. I could put all my gold coins in my pants pockets and hop on a bus to wherever. Try that with with barter firearms (or booze, food, tp, etc). One of my favorite preparedness authors is Ragnar Bensen. His books are just full of helpful information. He used to do lots of "work" in Africa during all the little brush wars there and when he was asked what firearms he travelled with into country he said that he brought no weapons with him. Ragnar claims that he always took some gold Krugerrands in his money belt and when he got to a country in conflict, he would buy what he wanted saying that there was never a shortage of weapons if you had gold.

Allerion

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Re: reality of silver coins for bartering in SHTF?
« Reply #12 on: December 14, 2008, 02:19:58 PM »
"Wealth, War, and Wisdom" is a recent book release in the economics category that pertains to preserving wealth in times of disaster.  The book specifically studies the case of world war II and what happened to property, stocks, art, gold, etc.  Clothing was a hot commodity in colder climates that I don't think any of us thought of mentioning as a store of wealth or for barter.  One family survived the entire war by bartering winter clothing.

Worth reading especially if you are a WWII buff.  There is much more content on events of the war than on economics but he did sum up that jewelry and gold were the best store of wealth if you have to cram your wealth in your pocket and flee the country.

Other good points included making sure that money you have oversess is really overseas.  If the government seizes your accounts your foreign stocks in your Goldman Sachs account will still be seized.  Also make sure that you can actually access your wealth if you have to flee to a foreign country.  A lot of war refugees showed up in Switzerland without account numbers and documentation and never got their money.  Some starved to death and others were sent home and died in refugee camps.

Art was almost a total loss.  Most was stolen and then destroyed by accident in transit.  Rich people's homes were burned and priceless art hidden inside was destroyed as well.

Overall, the best store of wealth was...(no surprise to Jack I'm sure) LAND.  Not buildings, but raw land.  Despite bombings and burnings in the end most land ends up back in the hands of its rightful owners, even when almost all documentation is destroyed.

Anyway, it is a good entertaining read.  Just thought I'd mention it if you're looking at what to do to preserve wealth for a SHTF scenario...like war.

Offline lonestar

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Re: reality of silver coins for bartering in SHTF?
« Reply #13 on: January 14, 2009, 11:54:14 AM »
Another possibility for gold or silver is to make large purchases like land, large livestock or even to pay property taxes.  Look back to the the movie "Gone with the wind".  Something to think about.  I know my description is not the greatest hopefully you get the idea.

Offline BigDanInTX

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Re: reality of silver coins for bartering in SHTF?
« Reply #14 on: January 14, 2009, 12:11:55 PM »
I agree with the storing of wealth, it is a great hedge and over the long term it looks great...As far as gold not being a barter item, not sure I would agree with that...I do agree that booze, food, and tobacco make great barter items.
This is why there's no magic bullet when it comes to your stores.  You can't say "buy silver" or "buy gold" or whatever only.  You need to first get your essentials to keep you and yours good for an extended period, then you need to then get a little of everything.  Gold is purchased to hold wealth or pay for the "higher priced" items.  Silver is purchased to pay for smaller needs beyond what's in your stores.  Basic necessities can be traded for other basic necessities should the need arise.  If you have a little of everything and (appropriately) don't put all your eggs in one basket, you will be better prepared for what may come.  If you need to abandon your location, you can still take some things with you.  If you have gold hidden on your person, you can still get basic supplies even if your things are confiscated or stolen.  It's a many-layered approach that is ideal.

Offline phil_in_cs

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Re: reality of silver coins for bartering in SHTF?
« Reply #15 on: January 14, 2009, 01:22:10 PM »
FerFAL says in Argentina, these days, after the currency collapse, that silver is almost never used in barter. Gold is, and gold rings, chains, and junk grade jewelry are common. He also says that for gold other than coins, you almost always only get 10kt value for items, since the person you are trading with has no way to tell if it is 14kt or 18kt.

Dollars and Euros are common too; people that have local pesos try to get them changed into something that will hold value as quickly as possible.

I'm surprised that silver isn't used there; the issue on getting under karat on gold surprised me too but that makes more sense. I don't know the history of that nation well enough to know if there's some reason for it.

http://ferfal.blogspot.com/ should be in your RSS reader.

Offline chris

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Re: reality of silver coins for bartering in SHTF?
« Reply #16 on: January 14, 2009, 05:12:13 PM »
Gold and Silver may be useful in the long run, but likely as not people will have forgotten how to use them in the short run.