Why Gold Would Be Useless in an Economic Apocalypse

[xchrom]

http://www.theatlantic.com/business/archive/2013/12/why-gold-would-be-useless-in-an-economic-apocalypse/282662/



Since November, financial advisor David Marotta has been publishing a series of blog posts on how to manage your money in the event of a financial apocalypse—as in a world of hyperinflation, governmental collapse, and anarachic mobs. You know, the standard stuff of a doomsday prepper's fever dreams. While Marotta admits he has some fears about the direction of the country (the man's not an Obamacare fan, to say the least) most of it seems to be fairly tongue-in-cheek material aimed at talking potential clients down from investing in some of the crazy, survivalist scams advertised on conservative talk radio. (Sadly, The Washington Examiner seems to have missed the humor).

And the first scam on his agenda? Plowing all your money into gold, of course. Here's his biblically inflected explanation of why toting around a suitcase of gold come the end times—and at today's prices, a $1 million in gold coins would fit in a suitcase—would be a suboptimal strategy:

If there really is a collapse of the money supply it is difficult to believe that your briefcase of pretty coins will still have any purchasing power near $1 million. In the 1970s, Christian singer Larry Norman made popular the Apocalyptic song lyric, “A piece of bread could buy a bag of gold” based on Revelation 6:6. In The End, I’d rather not have bought as much gold as possible.
In other words, when an economy goes full-on Mad Max and we're all reduced to bartering, the survivors are going to be more interested in useful goods than in a soft metal useful mostly for ornamental purposes. Part of gold's value as a commodity is derived from the fact that it can easily be traded across borders. But if that were no longer an option, and you were reduced to using bullion to buy a baguette, it wouldn't really matter what people in China or India were willing to pay for your gold.

[pipoman]

1. In an "economic apocalypse"

Everything except necessities will be pretty much worthless. Food, fuel, ammunition, medical products, etc. will be the only thing of value likely. .

[Comrade Grumpy]

31. I have poppy seeds. What will you trade for pain relief?

[NickB79]

2. Fuck gold; stockpile lead if you believe in that shit

Nice, bullet-shaped pieces of lead.

[hobbit709]

5. You can do the Lone Ranger one better and make bullets out of that gold.

gold is almost as dense as lead.

[sakabatou]

29. But I don't know if it can hold the rifling of the barrel (or even come out)

[Pretzel_Warrior]

45. I hate seeing gun nuts take over threads

but it is about apocalypse so what does one expect?

[exboyfil]

3. Liquor and cigarettes

Guns and ammo. Plant seeds. How to books (gardening and off the grid living). Of course canned food and fuel.

[Glassunion]

12. ^^^ THIS ^^^

Booze and smokes would be the currency in an economic collapse.

[TexasProgresive]

4. More valuable than gold in a total econ collaspe would be

most everything in catalogs like this:
https://www.lehmans.com/

But the real survivors will have the skills to grow and preserve food with primitive methods. Add to that administrative, strategic and tactical expertise in protection and security.

Likely what will happen is that strong arm bullies will steal everything of value, raping the women and killing the men. Read Ken Follett's books, Pillars of the Earth and World Without End.

Actually that aspect will be much the same as now just on a bigger scale since there will be no attempt to appear law abiding by the self appointed lords of the land.

Plus ça change, plus c'est la même chose

[CrispyQ]

21. This:

is that strong arm bullies will steal everything of value, raping the women and killing the men.

We are a wretched lot.

[TexasProgresive]

23. Pretty much

Do you think that there has been any real spiritual or psychological evolution of humanity since prehistoric times?

[ConcernedCanuk]

27. "We are a wretched lot." - yes indeed we are, always have been.

.
.
.

In my wee town of 2,000 - I know of one person who was arguing with another about survival if/when the bottom falls out.

One guy was bragging of his storage of food, growing of food and livestock, etc.,

The other guy just looked him in the face and said -

"Fuck that - If I need it, you got it, I'll use a 30 cent bullet and kill ya for it"

YES - that was the way the conversation went - I know them both personally.

The "survivor" with all his wisdom just turned white . . . .

but that IS what will happen methinks.

(sigh)

CC

[Iggo]

22. I think I read one of those Ken Follet books when I was really too young to understand it.

Maybe it was one of those, I'm not sure. There was a chapter of the book that dealt with the plagues that'd happen without the artificial checks and balances provided by civilization. One of those was a plague of wild cattle.

Is that from one of those books? 'Cause I'd really love to read that one again.

[TexasProgresive]

24. That doesn't ring a bell

Pillars of the Earth centered around the early days of building the great Gothic cathedrals. World Without End is a sequel several generations later with the Bubonic plague.

If you think of your book, PM me. I read most anything that's good.

[Iggo]

32. Success!

When I asked the old man about it, and told him that I most likely grabbed it off his bookshelf sometime in the late 60's, he said it's probably "Alas, Babylon."

Just remember, I probably read it when I was 8 or 9, so temper your expectations accordingly.

[TexasProgresive]

36. Thanks, I will try to get it

Alas, Babylon by Pat Frank
http://www.goodreads.com/book/show/38169.Alas_Babylon
The comments are very interesting

[JNelson6563]

41. And Pillars of the Earth is especially relevant here

because it took place during the "anarchy" when the throne was being hotly & violently contested between Stephen and Matilda.

Julie

[TexasProgresive]

42. Yes, that's right.

Alas! Babylon sounds like a book all preppers ought to read. It makes more sense to try to save our society, instead of wishing for it's collapse. Even a revolution can lead to unexpected consequences. You never know which faction is going to come out on top.

[Javaman]

6. there is a video game called Metro 2030. Bullets are used for money...

and besides, you can't eat gold.

[Nevernose]

8. Fwiw, based on a series of novels

They were good, quick reads (although the last time I checked, only the first two had been translated to English).

[Javaman]

11. Really? I didn't know that. I will look for them. Thanks! :) nt

[CoffeeCat]

7. Anyone notice the barrage of gold ads on right-wing radio???

I listen to right-wing radio, because I think it's important to know what the bozos on the other side are saying about us. Hey, if a poisonous snake slithered into my house, I wouldn't ignore it. I'd watch it like a hawk.

On all of these right-wing programs (including Limbaugh, Hannity, Levine, etc,) and even on our local right-wing radio program---the station breaks are soaked with gold ads. And these are fear-appeal ads, constantly playing up financial armageddon and Obama is often mentioned in these ads. I also see these ads on Fox News as well.

I also listen to NPR and watch MSNBC. I may hear a gold ad from time to time, but rarely. This constant flow of gold ads on these right-wing shows seems to be a calculated game by those who are attempting to scare the wingnuts (who also watch Duck Dynasty, dismiss climate change and believe that poor people caused the 2008 mortgage implosion).

This appears to be a well-orchestrated scam by elites who invested in gold very early. They planned to infiltrate the airwaves with scary ads targeted at the useful idiots on the right who would run out and buy gold to "protect their families in the coming end times." The price soars, and these early investors can add additional billions to their piles.

And these right-wingers have all bought into the nonsense. They think they're sooo savvy with their gold bars, which would be useless if our economy really did crash. The right wing elites have managed to use these tools on the right--and convince them of so many lies and half truths. Why not make some bank off of their stupidity with a gold scam?

In my opinion, this is a huge scandal that has yet to be acknowledged.

[former9thward]

9. I guess you don't listen to progressive radio...

Plenty of gold ads by Thom Hartmann and Ed Schultz, etc.

http://www.motherjones.com/mojo/2010/05/left-wing-gold-schultz-hartmann

[CoffeeCat]

14. I listen to NPR...

...and I also watch MSNBC. I rarely hear a gold ad. I don't listen to the Progressive radio programs as you do, and I appreciate knowing that information. It wouldn't surprise me at all to know that the elites who are trying to drive up the price of gold also use ads to entice others (besides right-wing natters) to buy gold.

However, the saturation level of gold as on these shows is over the top. And it's not just the ads, it's the doomsday propaganda perpetuated by these right-wing shows. Glenn Beck tells his viewers to stock up on these specialized MREs--which he just happens to sell during ads on his program. They sell fear constantly. This type of mentality--and the gold ads--are not as prolific as they are on right-wing outlets.

Someone is capitalizing on this fear-based selling.

And I don't think gold is an awful investment. Nor do I believe that gold would be useless is certain economic situations. Many buy gold for wise reasons. Not everyone who buys gold has their hair on fire and is motivated by Glenn Beck's ridiculous daily rants. However, a good portion of people ARE motivated by this malarkey.

It's just one con--that the elites use to siphon money from these very ignorant people.

[former9thward]

15. I agree fear is the driving factor in these ads.

That said I do believe in preparing for unknown disasters. Our cities are very dependent on a constant supply of food, electricity and water. In most cases the supply of those three items comes from outside the city -- sometime hundreds or even thousands of miles away. If something major happened there could be big problems. I keep a 3 month supply of food and water. Fortunately I live in an area where a lack of electricity would be an inconvenience but it would not kill me.

[CoffeeCat]

18. I agree that it is essential to be prepared...

...I also have a three-month supply of food and some extra water.

I don't think most people really think about the consequences of an event that could take out electricity or cause normal societal channels to seize up. I'm not paranoid, but if we lose electricity or there is some kind of illness or natural disaster--many people would be completely screwed because they are ill prepared.

Life as we know it now--is a delicate balance. Many things could happen to kick our way of life off kilter. I love The Walking Dead for that reason. That show demonstrates that our current way of life--our rules, our energy dependence, our morality, how we feed ourselves--is dependent on a delicate web of current conditions remaining constant. Of course, TWD is an extreme, fictitious example--but there are plenty of real situations that could throw society into a new paradigm.

Always good to have *some* kind of cushion.

[former9thward]

19. I love The Walking Dead.

It always makes me wonder how I would react in a similar situation -- minus the Zombies.

[CoffeeCat]

20. Agreed...

That show is about *so much more* than zombies.

Will be interesting to see what happens when the show resumes in Feb. We're looking forward to watching the first season. AMC is running every Walking Dead show, starting from the first show. Begins the 31st I think. Can't wait to see that first shows of the first season.

[TeamPooka]

25. The zombies are symbolic training for the public so they look at others as subhuman during

an apocalyptic crisis.
Its easier to shoot your neighbors if you think they are like blood sucking zombies.

[former9thward]

10. Very few people buy gold for the silly scenario given in the OP.

People buy gold as an insurance for an economic collapses of the order of Germany, post WW I. That was not an Apocalypse situation but it was a situation when paper money became almost worthless. People with gold did just fine.

[PowerToThePeople]

16. This

[Xolodno]

13. Lets just say for arguements sake...

...that the economic collapse is localized say to the USA and initial allies and gold still has value with other nations.

Walking around with a suitcase of gold makes you a nice target. Shoot the minute you do use your gold for purchases...someone now knows you have gold and word travels fast.

If you are trying to flee to another country (like the Nazi's did when they lost the war), you don't use gold coinage. The only gold you do use is in the form of Jewelry. And you sew up other jewels and jewelry in heavy clothes that way the next guard check point you reach, you can yet again, give them your last ring. And after you pass reach into your winter coat and pull out another ring for the next checkpoint.

Its sort of like watching a "dooms day" person prepare. They load up on gasoline and canned goods and hide them in cache's. That's all fine and dandy for the initial catastrophe. But you could probably solve all your long term energy needs by going solar. Develop a sustainable food/animal system (learn to make your own cheese, can berries, pickling, etc.) and maybe grow something else in excess that you can barter or process into something to be bartered (like liquor).

Carrying Gold, Gasoline and Guns will just get you killed in the absence of a localized police force...or actually get you killed by the localized police force when you stand up to their confiscation efforts.

But hey, what do I know...I don't listen to Glen Beck.

[CoffeeCat]

17. Glenn Beck has a new freak-out, doomsday warning...

...every hour.

I used to listen when he was on the radio, just for the entertainment value. I remember him urging people to be vigilant--because some "Middle Eastern looking people" were spotted riding school busses. According to Beck, they were riding along the actual bus routes, and Beck insisted that this was because they were plotting to take over our children's school busses and kill kids.

I had kids in elementary school and it was really scary. He droned on about this for days, insisting that an Al Queda attack on our school busses was imminent. He passed himself off as the only guy who was willing to tell the truth.

Of course, this freak out (along with his other freak-outs) proved untrue and ridiculous.

I don't know how these listeners put up with being emotionally manipulated into a fear-based fetal position by this dry-drunk lunatic.

Beck's show is now online and on BlazeTV--how own Web show. I think this is strategic. No one but his devout, ignorant sheep listeners hear his lunacy. His charlatan nonsense is kept out of the public realm and it is never examined. He gets away with brainwashing these people with no one to shine a light on how crazy he is. Perfect. They're like a bunch of rats, feeding on their own feces--with no one to tell them that they don't have to ingest this ridiculous crap every day.

[Ilsa]

43. He's Mormon now. They are big on prepping. nt

[dawg]

26. It wouldn't be useless.

It's pretty. It's a shiny yellow metal. it's soft; you can beat it into different shapes.

Can't make tools or weapons out of it though. Too soft.

I once used it to make golden apples, which I then used to re-animate zombie squidwards. (Let he who has knowledge understand.)

So ... not completely useless. But you'd be a fool to make it much more than 10% or so of your investments.

Also, it attrcts drgons.

[Egalitarian Thug]

35. Marvelously useful for when you have to manufacture your own electronics.

[frylock]

28. one bar of gold for a sip of water

[Jessy169]

30. Speaking of gold and financial apocalypse -- T'was the Nightmare Before Christmas

T’was the night before Christmas, when across all the seas
Not a Doomer was stirring, not even RE.
The False Flags were in the MSM all over the place,
While Politicians mumbled their words of disgrace.

The Diners were nestled all snug in their beds
While visions of Mad Max danced in their heads
WHD in his Red Afro Wig, and I in my hat
Had just settled in to watch Civilization go splat.

When out on the internet there arose such a clatter,
I sprang to the Laptop to see what was the matter.
Over to Google I flew like some birds,
To type in Apocalypse and other Keywords.

The news on the net was like new fallen snow,
Flakes of disaster everywhere I would go.
Off with my wandering keyboard fingers I went to visit
Zero Hedge, Survival.com and 8 blowhard Collapse Pundits

The news was so bad I surfed ever faster,
searching wide to find the cause of disaster.
More rapid than Assault Rifle gunfire the news came on in,
Of Earthquakes, Volcanoes and all Human Sins.

Now Kunstler! Now Orlov! Now, McPherson and even Jim Quinn!
On Ruppert! On Gail! On, on Denninger and Steve from Virgin!
To TEOTWAWKI as we head for a mighty big fall!
Now Dash away, Dash Away! Dash away from it all!

As Mall Signs and Rooftops before the wild hurricane fly
When they meet with an obstacle, mount to the sky.
Every keyboard was flying, calls of the end came everywhere
The Doomosphere was just chock full of despair.

And then in a twinkling, I read on the net
Illuminati across the Globe were begining to Sweat.
Bond spreads were wide, Futures were down,
Derivatives and CDOs were beginning to drown.

Gold bugs were Frantic, piles of Maple Leafs high to the sky,
While at Safeway and Walmart not a Twinkie to buy!
Preppers were loading their Glocks full of Lead,
Hoping to be the last of the Doomers left dead.

Permaculture raised beds and hydroponics were secured,
as Industrialization’s Ills could not be cured.
Heirloom Seeds in Nitrogen vaccuum packs were stored,
Ground floor windows were covered with 2×4 boards.

In Central Park all the OWSers set tents on the Grass,
the showdown with the NYPD would now come to pass.
The truckers rolled in and the Hell’s Angels too,
then the Longshoremen came in from out of the blue.

In CONgress the budget went over the Cliff,
while Obama said, “Hey, what’s the diff?
My Man Benny has the Inkjets all ready!”
No worries folks, the economy will stay steady.

In Brussels at the IMF the Eurocrats fumbled,
playing violins as the Euro crumbled.
In Japan the Sushi was glowing,
While Abe made sure those Yen kept on flowing.

In MENA the Drone Aircraft were flying,
with Women and Children doing most of the dying.
In the Straights of Hormuz Mines were placed to counter the Drones,
So all the tankers and carriers would be sent to Davey Jones.

In China the economy was rocking,
Ghost Cities and Bridges to Nowhere filled up their stockings.
Foxconn workers off factory rooftops went jumping,
While the Iphones out of the factory kept pumping.

The situation was dire, the whole world was on fire.
Everyone everywhere all caught in the mire.
The whole human race so utterly lost,
Happy Motoring and Industrialization exacting a terrible cost.

RE sprang to his keyboard to give the Diners some HOPE,
even though the world seems at the end of its rope.
They heard him exclaim, ‘ere the Internet went out of sight,
“Happy christmas to all, and to all a Good Night!”

http://www.doomsteaddiner.net/blog/2012/12/24/twas-the-nightmare-before-christmas-2012/

[Egalitarian Thug]

33. Buy high, sell low, the gold bug's lament and market. The Stupid creating the Rich years

after any opportunity is long gone.

[haele]

34. In an economic apocalypse, alcohol and gas will be the most important commodities.

In that order.

After that, ability to grow food, and personal skills that can be bartered.

Haele

[spin]

37. David Marotta in his series of blog posts also mentioned the value of owning firearms ...

and having a "bug out" bag in a financial apocalypse.

Should I Be Storing Food, Water and Firearms?
DECEMBER 11, 2013 BY DAVID JOHN MAROTTA

***snip***

Just to be clear. Firearms are the last item on the list, but they are on the list. There are some terrible people in this world. And you are safer when your trusted neighbors have firearms. But in most disasters, including I suspect TEOTWAWKI, most people you meet will be civil.


Still, a bug out bag is a good idea depending on where you live even if the emergency is just power outages, earthquakes and hurricanes. And with your preparedness you will be equipped to help others who might be in need.
wallstreet advisor guns and ammo in a financial apocalypse

http://www.marottaonmoney.com/should-i-be-storing-food-water-and-firearms/


Marotta strikes me as somewhat of a survivalist.

Still he is definitely correct that having "bug out" bag is a damn good idea. I had to evacuate Tampa when Hurricane Charley was predicted to make landfall in the Tampa Bay Area in 2004. I remember madly racing around my house gathering up important items and paperwork before I left. Fortunately Hurricane Charley decided to make a hard right turn and instead made landfall in southwestern Florida 60 miles from my daughter's home where I had evacuated to. Had it followed the predicted path and hit the Tampa Bay Area it is quite possible that my home would have ended up totally flooded.

After that incident I learned to keep a bug out bag packed and ready so I could leave in a matter of minutes rather that hours.

In a total financial melt down firearms and ammo could be traded for other essentials. A box of ammo might easily be swapped for a good quantity of food or supplies. A rifle, shotgun or handgun might prove to be a very valuable item to barter. Of course a firearm could also save your life or the life of family members. Many Americans fear a total financial meltdown largely because of propaganda spread by the conservative press and right wing talk show hosts. Perhaps that is one of the reasons for the skyrocketing sale of firearms in recent years and the fact that store shelves have often been bare of ammo.

Surprisingly the increased sale of firearms has not led to a large increase in violent crime. For some reason violent crime and firearm crime has dropped to levels last seen in the late 1960s. I suspect this is a result of better and more proactive police work.

Unfortunately guns are not for everybody. Many people who purchase them lack the training to safely handle them. Others may tend to abuse alcohol which does not mix with handling a firearm. Some people have serious mental problems and they misuse firearms to commit mass murders. Also there is no doubt that owning a firearm makes committing suicide easy and failure to store your weapon properly can lead to a child discovering it possibly ending in a tragic result.

Of course in a true financial collapse, firearms could be empower the criminal element to invade homes and steal food and supplies.

We may well face difficult economic times in our future but I honestly doubt that we will have the total disaster that David Marotta fears.

[bvar22]

39. "Lessons from Argentina's economic collapse"

This is a 1st Person account written by someone who lived through Argentina's Economic Collapse in 2001.
It is eye opening, very much worth reading.

Lessons from Argentina's economic collapse
Part One

URBAN OR COUNTRY?:
<snip>
Of course that those that live in the country and have some land and animals were better prepared food-wise. No need to have several acres full of crops. A few fruit trees, some animals, such as chickens, cows and rabbits, and a small orchard was enough to be light years ahead of those in the cities.

Chickens, eggs and rabbits would provide the proteins, a cow or two for milk and cheese, some vegetables and fruit plants covered the vegetable diet, and some eggs or a rabbit could be traded for flower to make bread and pasta or sugar and salt.

<snip>

Those that live in cities, well they have to manage as they can. Since food prices went up about 200%-300%. People would cut expenses wherever they could so they could buy food. Some ate whatever they could, they hunted birds or ate street dogs and cats; others starved.

When it comes to food, cities suck in a crisis. It is usually the lack of food or the impossibility to acquire it that starts the rioting and looting when TSHTF. When it comes to security things get even more complicated.

Forget about shooting those that mean you harm from 300 yards away with your MBR. Leave that notion to armchair commandos and 12 year old kids that pretend to be grown ups on the internet.

Some facts:

1) Those that want to harm you/steal from you don't come with a pirate flag waving over their heads.

2) Neither do they start shooting at you 200 yards away.

3) They wont come riding loud bikes or dressed with their orange, convict just escaped from prison jump suits, so that you can identify them the better. Nor do they all wear chains around their necks and leather jackets. If I had a dollar for each time a person that got robbed told me, "They looked like NORMAL people, dressed better than we are", honestly, I would have enough money for a nice gun. There are exceptions, but don't expect them to dress like in the movies.

4) A man with a wife and two or three kids can't set up a watch. I don't care if you are SEAL, SWAT or John Freaking Rambo, no 6th sense is going to tell you that there is a guy pointing a gun at your back when you are trying to fix the water pump that just broke, or carrying a big heavy bag of dried beans you bought that morning.

http://www.silverbearcafe.com/private/10.08/tshtf1.html

IIRC, he says that gold (especially coins) did remain a medium of exchange,
but guns, ammo, food, medicine, and batteries were more in demand.


The problem with GOLD is that the market is completely manipulated.
There are countries that hoard vast amounts of gold,
and if one of them decides that it is time to Crash the Market for whatever reason,
or if the Big Boys on Wall Street decide it is time for some "Profit Taking",
then it is OVER for every small customer who is buying Gold "as an investment".
Like the Real Estate Bubble Collapse, they will be left Holding-the-Bag.

In 2005, my Wife & I decided on Bubble Proof unspoiled rural land surrounded by National Forest with mild Winters and an on property source of clean drinking water.
We live there now, and grow a good percentage of our own food (veggies, fruits, & berries)
raise chickens, and keep Honey Bees.

We are NOT "Survivalists".
We are just old hippies who have always been attracted to this independent, sustainable, green lifestyle.
We sincerely hope that a collapse does NOT happen
because that would make things harder on us too.

There ARE some "Survivalists" who have moved into this remote area.
They stock up on MREs & guns, and fantasize about the day it will be OK for them to shoot hungry people.
They scare us, and we stay away from them.

[truebrit71]

40. That was an interesting link...

...a lot to go over, but several important things to consider...thanks!

[Ilsa]

44. Toilet paper will be a hot luxury item! nt