I know people out there who have invested a lot in gold under the belief that in the event of like complete societal collapse or hyperinflation, they could use it for purchasing.
I have the hunch it’s a scam, but I haven’t learned enough monetary theory, business, or economics to understand why.
You must log in or register to comment.
I’m acquiring a little gold. Not a lot, but enough.
What’s enough? When my family was escaping persecution, they managed to travel under the cover of night and stayed in people’s barns and homes during the day. They planned and managed these arrangements via transactions using gold coins, links or pieces of jewelry, or other relatively universal valuables. They also got away a couple of times using the same goods to bribe authorities.
A small number of generations of my family dealt with being told that their money or credit was devalued due to their religion, profession, or relationship to public figures. In those instances, the family members who fled survived, and most of the ones who didn’t flee died.
I don’t know that I have much faith in my ability to flee anything, so I’m not investing that much time or money into acquiring gold things. Found some old watches from my grandparents/great-grandparents that claim to have gold in them. Have a couple of my own little things and jewelry I’ve given my wife. All just things when the time to survive arrives. Which it might not ever.
I hope this somewhat answered your question.
It’s a commodity that’s widely used as a way to keep the value of a portfolio in case of inflation. Gold has a lot of utility but recently because of uncertainty about the US dollar central banks have been stocking up on gold.
Complete societal collapse is very unlikely and we have studied economics enough to the point where hyperinflation is avoidable.
For investors keeping some gold (10-20% of portfolio) can be very nice since it allows you to buy the dip and is inflation proof. On the other hand, gold can become a speculative asset so it’s value can be inflated just like any other commodity. So in a way currently it’s either a nice tool or a bubble (or scam as you call it).
Silver, used in solar panels, is also pretty good for same reasons.
So much FUD and complete misinformation here. Gold, first and foremost, is a store of value and a hedge against inflation. It’s a terrible investment. That said, if you bought 10k worth of gold 5 years ago, you would now have 20k. Which is obviously a higher return than most savings products or some actual investments.
It’s a hell of a lot safer than BTC and if society does collapse, it will absolutely retain its value.
Obligatory not an economist, only know some basics about investing (and quite lazy about it)
I always thought that gold is just a rather unique commodity that people can also have the option of holding physically (not that it’s advised to do so). Professional investors invest in just about anything as long as there is a potential return on investment, like typical stocks and bonds, gold and silver, housing/land, art, literal truckloads of food… frankly gold isn’t even remotely the weirdest or “scammiest” on this list
As for more regular people, I do have a suspicion a lot of con-artists and/or people with suspicious intents heavily promote gold investing though. Also some libertarian types have a weird… fantasy? of total societal collapse with them rising to the top post-collapse, which I do not quite understand. But I’d presume gold would be attractive to those types since gold has been used as a means of transaction for a long time in human history
Bad news for the Libertarians: silver was historically way more common for money than gold was, to the point that languages like Irish and French use the same word for money as for silver.
This is because there was (and is) way less gold than silver, so gold is way more valuable. As such, gold coins were only used to buy things like houses, horses, and suits of armour. Silver coins were much more practical; the linked article mentions that Ptolemaic Egypt had to export large quantities of grain to bring in enough silver to pay their army despite there being gold in Egypt.
But more than that, if there is a complete societal collapse, the metal you’ll want is iron. Societal collapse doesn’t mean things continue as they have been except there are no safety or food quality laws. It means everybody goes back to peasant agriculture using tools made of wood and iron (well, steel, which is iron with extra stuff in it). If money is used, it might well be something where no coins actually change hands; everybody just remembers how much they owe their neighbours, and how much their neighbours owe them. That, if course, assumes that in the event of complete societal collapse, we don’t decide to give local communism a try.
It is an ok hedge on inflation, but it is pushed a lot by scam adjacent businesses to push up consumption.
NFCs, bitcoins, silver, gold, whatever. If the only way people can cash out is to get someone to buy what they’re selling, there’s always going to be an element of grift to it. It’s just some are more grifty than others.
I mean that applies to literally everything
Everything that you make an investment in has some measure of liquidity.
Invest in land: they aren’t making any more of it.
Hawaii’s Big Island be like:
24-hour lava flow asmrThe Dutch: hold my beer
When was the last complete societal collapse?
Gold is a good hedge against inflation. When was the last hyperinflation in your country?
Yeah but so is having any currency
Look at the zoomed out 5 year chart for its price and you tell me.
$1,839 -> $4,217
Yes, but:
https://www.macrotrends.net/4534/cpi-purchasing-power-of-the-dollar
Gold is just another asset, it belongs in any long term portfolio at least to a small degree, and if you take the possibility of market instability seriously, you might consider keeping some actual metal on hand. Though silver is somewhat more practical for that.
The thing about the value of gold in a society is that it is only valued within the society. If society collapses, there will be no group or entity that could value it. You’d need to wait until people start rebuilding. But then you’d need to be in a position to shape how currency is decided on and minted. Unless you’ve kept your load of gold secret, it’ll be hard to convince people to adopt gold as a currency without starting on more even ground.
To clarify, when people colloquially refer to “the collapse of society” they don’t mean that all forms of society would cease to exist, but refer to the failure of the nation state, or possibly the international order, and the long supply chains that go with it. Etc.
So society at various scales would still exist, in overlapping ways and jurisdictions. Basic units like neighbourhoods and firefighters and towns and regions would be organizing based on the old rules and adapting. People organize well in the absence of warlords, so that and extinction events are the threats to trade.
The value of trade goods might be indeterminate if a comet wipes nearly all of us out. Otherwise, many people love to dicker and argue about the value of things, so I’m pretty confident about rare raw materials like gold having both utility value and a reasonably inflated exchange value in a prolonged regional or international crisis.
Compare gold to the other elements on the periodic table as a medium to store value and you’ll see why it is used for this task.
It is non toxic, it can be easily held and transported, it is non reactive (it won’t rust or combust), it is relatively rare, it is dense (a lot of gold fills a small space) and, well like others have said, it’s shiny. It can be easily moulded and forgotten about for millennia and still be the same way it was last used (look at Viking hordes as an example) few other things can do this, maybe diamonds? But they can not be recombined again like gold
Ever since we found gold we have valued it. I don’t understand the position of, “Oh, no one will value it!” We love the shit and it’s a store of value. How much value is dependent.
You can’t eat gold, and you can only trade gold for food if that person can trade the gold for something else. I’m not going to say there’s no chance of gold being valuable in a societal collapse scenario, but I’d rather wager with resources than a pretty, shiny metal. I don’t see how that’s a position that can’t be understood. Gold works as an intermediary exchange, but direct barter can always be counted on.
Gold is good as notation for big things, like an excavator and a dozen barrels of diesel. You can’t trade that shit for cucumbers and canned tuna.
You can use gold as an excellent long lasting conductor for electric equipment. You can make it very thin. It would make a comeback in basic dentistry, as you can actually eat it: it’s non-poisonous. Doesn’t tarnish. A smith can do a lot with gold.
Gold is a resource. That said, I don’t have any right now. Just some silver coins, and some packaged goods like knives and flour mills (business leftovers). Given the market insecurities now and gold’s all time high price, wish I did.
Because it was found by people in society. It was given value within an established society. I’m not saying no one will value it. I’m saying that until there is an established society, it won’t hold value. Then if you do end up in a society, you need to sway them to adopt gold as a currency while keeping your gold stores secret.
Idk man… Humans like shiney baubles. Remember: Gold was a valuable commodity before we even had legit uses for it beyond decoration.
Because it was found by people in society. It was given value within an established society. I’m not saying no one will value it. I’m saying that until there is an established society, it won’t hold value. Then if you do end up in a society, you need to sway them to adopt gold as a currency while keeping your gold stores secret.
It can be used for barter, gold had enough of a reputation that you can get anyone to trade you for it if they have an excess of something.
If there is complete societal collapse, then gold is going to be worth nothing, because you cant eat it. Bullets on the other hand you can use to take peoples food, or hunt for your own. So invest in bullets!
Now if you just expect financial collapse but not total societal then sure gold, silver, bonds are probably fine if you want “safe” stable ways to hold your investments.
In most cases, its just fear-mongering and gold has no more actual value than paper currency since they both derive their value from sentiment or perceived value. So if you show up at my house and offer me a small gold bar, you value at $10,000, and I value it at a potato, then your $10,000 is actually only worth a potato.
In fairness, if the US dollar collapses, say, but the euro is fine and you find a way to get to Europe, you’re much better off with a few chunks of gold that will be worth relatively what you bought them for than with wheelbarrows full of hundred dollar bills which are now worth less than paper.
I doubt you get far checking in a suitcase full of gold after the dollar collapses in such a colossal way
I doubt you’d get far even trying to carry a suitcase full of gold.
Bullets should be saved for protecting your community…trap and snare your animals :)
Naw use em to shoot people in the wasteland and take their things.
Ain’t no one safe in the post apocalyptic waste lands!
You can definitely make an argument that “proactive” protection is a strategy :)
I needed your stuff so I could have more stuff.
When the world collapses, nobody’s going to care about gold.
Stock up on bottlecaps instead.
You’re forgetting the crows that like shiny things
As a person who has an abnormal number of bottlecaps for hobby reasons, thank you for making me feel rich! Also, why would anyone else want these?
Well, for one thing, the supply of googly eyes will run out and you will have to adapt.
I think they’re referencing the game Fallout where bottlecaps are used as currency
It’s almost certainly a joke but bottlecaps in a post civilization society would make a pretty decent currency, more so than gold.
They’re light, easy to carry, hard to reproduce and therefore scarce. They’re also useless for anything else. So if you happened to have a lot of caps laying around they might find their way to becoming a currency.
Gold is heavy, requires a lot of work to make it useful as a standard, and has other practical uses. Caps are actually better.
Yeah but making them isn’t complicated just medieval smelting is needed which is basically the iron ages
We homebrewers will be the thousandaires of the end times!
I assume you’re talking about physical gold.
Yes, it’s generally a scam. Some middle man is going to take a cut of what it’s worth before you enter the market - and they’re almost always going to misrepresent it’s value, especially if it’s not in the form of a stamped bar. Then you basically have to store it and shlep it and secure it and keep it secret, which will further diminish profit. Then you have to sell it, presumably as part of your retirement plan…or leave it to somebody who’s going to lose even more of its value when they want to unload it inefficiently.
If you’re not wealthy in the first place it’s only worth investing in as a hobby…because you have to factor in the value of your time and subtract that from its value, as well.
As far as it being a hedge against the collapse of currency? Bad idea. Skills and land you can defend are going to be the only hedges against that. Even if it had value post collapse…it would just put a target on your head.
The amount of time it would take for a post collapse society to regain enough stability to return to metal being needed for a currency is likely longer then you would be alive to actually benefit from the investment.
Short term only direct barter and labor will be worth anything. You only need a currency when you have a non volatile society.
It’s why the whole post apocalyptic gold value nonsense is nonsense. You NEED an economy to make currency have value. A post collapse society has no economy.
Yeap.
Like…depending on the nature of the collapse you might have a bunch of delusional former MAGA people in a region who all have a bunch of gold so they trade it with each other…but for the most part nobody would want it.
The only things that will have value when society collapses are food, water, shelter, off-grid power, ammunition, and weapons.
Don’t forget “skills you can use to make yourself valuable to a small community”, especially the skills to grow and prepare food, locate and purify water, construct and maintain shelter, maintain and upscale off-grid power, and use ammunition and weapons.
It will be whatever the remnants of society deem valuable and convenient to use for condensed wealth. Probably bottle caps.
Unrelated, anyone else looking forward to fallout season 2?
