Why Buy Gold And Silver As Investment?

Well to go back on investing.

Money is used as currency. Fiat based currency eventually becomes worthless. Having a lot of money in the bank may not be a good idea because it may become worthless because of hyperinflation. People invest money in gold and silver to preserve their wealth and purchasing power. I agree that you can do this. But you can preserve your wealth in anything can't you? Instead of buying several ounces of gold, why can't I just preserve my wealth in toilet paper? Due to hyperinflation the price of gold will go up... and so does everything else. Gold and silver can be used as a alternate currency. Well if you have lots of gold and silver saved up for economic collapse, then you are going to need to spend it on products that you need that you don't have stocked up.

I guess it still dosen't make much since to me. I guess I'm just not one to gamble with my money and play the value of gold or silver and hope it goes up and try to make profits. I feel as if you shouldn't really invest but preserve your wealth in gold or silver. I feel as if there is much more better things to preserve your wealth in then precious metals and that you should preserve your wealth and things that you will need no matter how bad the economy gets, like toilet paper.

One of the most persistent delusions in economic history is that gold & silver are wealth. It seems to have grown out of chronic coin shortages in the late Middle Ages & early Modern period, which left countries short of coins to do business with. They were desperate to bring in more gold & silver, & after a while grew to think that having more gold & silver made a country more wealthy.

Precious metals are things you can reliably exchange for real wealth, the necessities & luxuries of life. In normal times, there are other things which can be just as reliably exchanged. It is in abnormal times that the precious metals become of considerable importance. The story is told of two brothers, sons of an Austrian nobleman. When their father died, one put his inheritance into good securities, the other spent it all on champagne & drank it. After 1923, the spendthrift brother was better off, because he'd kept all his empty bottles, & they were worth more than the frugal brother's investments!

The "flight into real goods" can reach an extreme, as in the case of the company which was formed at the time of the great German inflation to sell shares in the sand at the bottom of the river Oder. It was a real physical thing, & therefore preferable to constantly-depreciating marks. Indeed, the way the German inflation was finally stopped was to announce that a new currency (the Rentenmark) would be introduced, based on the value of the industrial property in the country. Everyone could agree that the German factories & mines were worth far more than the roughly $1 US that would be required to buy them all, according to the prevailing exchange rate & the valuation on their mortgage bonds, so people just agreed to accept a new currency tied to that valuation, even though it had no more real backing than the old mark.

In case of anarchy, I suppose one could use gold as a replacement for lead. I'm sure my fishing success would improve with a 24k line weight attached.

IF you have money to invest, buying gold and silver as your first investment is the worst thing to do.

Rather one should look for something gives yield, produces income and pays you something.

Gold and silver don't do that. It gets worse if you are not engaged actively in the financial markets. While I think the average person could master how to profit from gold and silver and how it moves up and down, most people might shy away from it and quite frankly, you must live, eat and breath trading and make it a full time effort to be successful.

So, buying and holding gold and silver really will only work when its trending up for most folks. At this stage, the best most basic thing the average person can do is buy only a small percentage in gold and silver and not make it a major portion of their investment.

Right now if the US economy collapsed it would be a world wide apocalypse. Markets around the world are largely based on our buying power with us being the worlds largest consumer of basically everything.

The huge difference between now and Roman times is in Roman times people were self sufficient. People now are technologically dependent and the vast majority of people in Europe and North America especially couldnt survive without supply lines leading to grocery stores/stores. Everything in the world is based off power and machines. No economy, no one to run the power plants or make the gasoline ect. Only the Amish are really prepared for it and they would probably get over run by people wanting supplies.

On the bright side you dont have to worry about it baring a massive natural disaster or nuclear war. Economics are what they are because people say thats how it is. Theres no hard set rules like physics has, its all just a system designed to try and be a motivator for people manipulating human nature to work and be productive. The world would not allow the US to collapse economically because of the world wide implications it would have.

That could change one day, but it would take a long time and be painfully obvious the rest of the world was taking steps to isolate themselves from us. Even then they would be causing harm to their economies in the process making it even less likely. If it did happen it would be a gradual decline over generations and probably hundreds of years like what happened to the Romans. Instant hyperinflation rarely happens to first world or large countries, Germany is one of the exceptions but that was also because they started world wars and back then global economics werent tied together like they are today.

Star I agree I think a lot of people really under estimate the massive amount of devestation the world would see. Even on shows like doomsday preppers a lot of them seem to think there's going to be barter systems and all this, there wouldn't be for quiet some time. Katrina gave us a good look on a small scale of what would happen and that was only a tempoary disruption of supplies with an active government still in charge. The people stranded on their roof tops actually ended up being the safest with the flood acting as a defensive barrier.

If it did collaspe you want to be as far away from people as possible because the panic will be like nothing modern history has seen. Death tolls would likely surpase the plague ones and it may not even be close. If society fell apart and you aren't part of the military where you can stick together as a massive well supplied fighting force you're going to have a less than 50 percent chance of survival and that may be generous.

Basically everyone would just have to say we give up as a species, everyones on their own and has to fend for themselfs now. You vs everyone else isn't very good odds.