Gold Nose Dives To Current Low

Silverskunk, you can PM me by clicking on my username & finding the 'send email' link on that page. if not, no worries.

I agree this might be the most important question in this discussion, @MisterT. My hunch is that gold is being oversold or overly romanticised in the markets and on socials. If we do land in barter town, the value of gold will almost certainly drop somewhat in real terms because who buys a loaf of bread for $3500, or should I say "dollars"? People will want something with value that more closely approximates the value of the item being purchased.

Also, I suspect a careful review would find plenty of fake PMs being sold. Many people would struggle to identify them on any given day by sight or feel anyway, and it's easy enough to plate a base metal or copper. A quick search of the web shows a number of such scandals being revealed. But they have not all been identified. I prefer to find my silver in the wild at auctions.

What a quaint idea, a nice orderly BarterTown where you can conduct business with 1964 silver. Is this before or after 3/4 of world population is gone?

For those who scoff at the idea of a barter society, consider this. Throughout history empires have risen and collapsed because of one main ingredient, Debt. It happened to the Roman Empire, Ottoman Empire, Spanish Empire, French Empire, Germany after WWI, Soviet Union during the cold war and it can happen here in the U.S. too. What happens when our worthless fiat money becomes even more worthless? When we emulate Germany by requiring a wheel barrow full of worthless paper to purchase a loaf of bread. It doesn't mean that 3/4 of the world population would be eradicated but it makes a good argument for the stacking of PM's which is the only true form of wealth as it has been for centuries.

Curiously enough, one of the primary factors leading to the end of the Spanish Empire was the sudden abundance of silver from the New World colonies in 1530 devaluing their currency and causing prices to soar.

A USD collapse has just about zero probability. Two reasons. No other currency can takes it's place. And USA would never default, i.e. stop printing when all the other major economies do the exact same thing. If currency performance is a rough guide to reckless printing, USD is doing better than China, India and Japan, and roughly the same as Germany.

Ask yourself , without fiat where would China be with the COVID epicenter in Wuhan? Without fiat where would Japan be after the 2011 earthquake and tsunami?

The other thing about the reliance on the U$ is that it has become an anchor around neck of the global economy, and no one can realistically afford to throw it overboard. I think that was learned in the recent kerfuffle when certain countries started threatening to sell a certain country's bonds in retaliation for that country's abrupt economic policy changes. The more seriously aaggrieved countries could organise further to undermine the U$, but that would probably happen on the down-low until they had a plan of action up and running. Even then, many countries hold a LOT of US debt, for better or worse.

I suspect that if/when the U$ falls off its perch the main precipitating factors will have been missed by most prognosticators. It will be future historians who, with the benefit of hindsight, will wonder why we didn't all see it coming.

Side note: Limitations on "talking politics" here make sense at one level, but it is a little funny when trying to talk economics to also not talk politics since the two are inextricably linked. It's a little like not being allowed to talk about where to shop for specialty ingredients when advising someone on preparing a particular meal. Again, I get it, but it is a little odd. I think the trick is being dispassionate about it. It's possible to discuss things without offering an opinion. It's a fine line. If I cross, I'm glad to be corrected.

@I6609: I hear you, but I think part of the reason things are "too far apart" is that the insistence on not talking religion and politics in "polite conversation" means that people are failing to learn how to have a polite conversation about politics and religion.

The application of our rule against political discussion is a little bit looser in the Precious Metals and Bullion forum for those reasons stated above.

We draw the line at partisan bickering, propaganda, finger pointing, etc.

So, just be careful and make sure your political references are historical and/or relevant to the topic. Stick with facts, as best as they can be determined, and avoid the spin.

A good way to test yourself: Can we determine with 100% accuracy who you voted for in the last election* from your post? As long as you appear neutral, we are good. Otherwise, it will just prompt a response from the other side.

I hope this helps keep the conversation civil and engaging.


* This can be applied anywhere in the world. Partisan politics is not unique to the US.