Prepping for Uncertainty: The Role of Precious Metals and Essentials in Survival Strategies
Shimmering Assets: Gold and Silver
Gold
Since the dawn of civilization, societies have sought various ways to facilitate trade. While bartering was perhaps the earliest form of commerce, the need for a more sophisticated, universally accepted form of exchange soon emerged. Among all the materials selected to serve this purpose, gold—valued for its rarity, beauty, and malleability—holds a unique place in our history. From the ancient Egyptians to the modern-day fiat system, gold has played a fundamental role in the evolution of money.
The Egyptian Era (c. 3150-30 BCE)
The ancient Egyptians were the first known civilization to use gold as a form of currency. They mined it from the rich veins of the Nubian Desert around 3,600 BCE. Gold, or 'nub,' as they referred to it, was commonly used in religious ceremonies, for tomb construction, and as a material to craft statues and jewelry. Over time, the Egyptians standardized the use of gold in trade by shaping it into rings and other units, facilitating its use as a medium of exchange.
(Source: Feinman, G. M., & Nicholas, L. M. (2004). Archaeology at the Millennium. Springer Science & Business Media.)
The Lydian Stater (c. 7th Century BCE)
However, the first known official gold currency was issued by King Alyattes in Lydia (modern-day Turkey) around the 7th century BCE. These coins, called staters, were made from electrum, a naturally occurring alloy of gold and silver. They were stamped with the image of a lion to authenticate them, marking the first standardized gold currency and the dawn of coinage as we understand it today.
(Source: Kim, H. (2001). Archaic Coinage as Evidence for the Use of Money. In The Cambridge Economic History of the Greco-Roman World. Cambridge University Press.)
The Roman Aureus (c. 1st Century BCE - 4th Century CE)
The Roman Empire was another significant civilization that recognized gold's power as a currency. The Romans introduced the aureus, a gold coin that bore the image of the reigning emperor. The aureus remained in circulation for several centuries and was crucial to sustaining the Roman Empire's vast trade networks and military campaigns.
(Source: Hollander, D. B. (2007). Money in the Late Roman Republic. Brill Academic Publishers.)
The Gold Standard (19th Century - 20th Century)
Fast forward to more modern times, the gold standard was a monetary system in which countries tied the value of their currency to a specific amount of gold. It was established in the 19th century and used by many countries, including the United States and Great Britain, until the mid-20th century. The gold standard provided stability by ensuring that the value of currency was not subject to the whims of governments or volatile market conditions.
(Source: Eichengreen, B. (2008). The European Economy since 1945: Coordinated Capitalism and Beyond. Princeton University Press.)
In conclusion, gold's role as a form of currency has shaped the course of civilization, driving trade and economic development. While we now use more modern forms of currency, the legacy of gold persists. Its historical value and enduring appeal as a safe haven in times of economic uncertainty continue to remind us of its significance throughout history.
Silver
Just as gold has been a prominent player in the history of currency, so too has its lustrous cousin, silver. Valued for its relative abundance, ease of extraction, and aesthetic appeal, silver has woven its thread through the tapestry of human economic history, serving as a medium of exchange in several influential civilizations.
The Ancient Greeks (9th Century BCE - 1st Century BCE)
Perhaps the most iconic example of silver's use as currency is found in ancient Greece. The Greeks introduced the drachma, a silver coin, around the 9th century BCE. The Athenian version of the drachma, made from silver mined in Laurion, became the dominant currency in the region due to its widespread acceptance in trade.
(Source: Price, M. J. (1983). Coinage in the Greek World. Seaby Publications.)
The Roman Denarius (211 BCE - 3rd Century CE)
The Romans, while also known for their gold currency, significantly utilized silver in their monetary system. The denarius, a silver coin first minted in 211 BCE, became the backbone of Roman commerce for several centuries. The image of the reigning emperor commonly adorned one side of the denarius, which facilitated recognition and acceptance throughout the vast Roman Empire.
(Source: Metcalf, D. M. (2012). The Oxford Handbook of Greek and Roman Coinage. Oxford University Press.)
The Chinese Tael (6th Century BCE - 20th Century CE)
Across the globe in ancient China, silver served as a common medium of exchange, albeit in a somewhat different form. Rather than minted coins, the Chinese used silver ingots known as "taels." These silver units, shaped like small boats or shoes, were weighed in trade transactions and remained a central part of the Chinese monetary system until the 20th century.
(Source: Peng, X. (1994). A Monetary History of China. Western Washington University.)
The Spanish Real (1497-1864)
Fast forward to the era of New World exploration, the Spanish 'piece of eight,' or the silver real, played a significant role. The real, minted from vast amounts of silver discovered in the Americas, became a global currency due to Spain's extensive trade networks. The piece of eight was widely used across Europe, the Americas, and even as far as Asia, reflecting Spain's influence during the Age of Discovery.
(Source: Cobs, Pieces of Eight and Treasure Coins: The Early Spanish American Mints and their Coinages 1536-1773, by Sewall Menzel.)
In conclusion, silver's utility as a form of currency has had a profound influence on the evolution of global economies. Its legacy continues to echo in our present financial structures, reminding us of its invaluable role in the annals of human trade and commerce.
Recent History After an Economic Collapse
In the face of economic instability and hyperinflation, societies often resort to tangible assets such as silver and gold as mediums of trade. Over the past fifty years, several nations have experienced this phenomenon as their currencies crashed and traditional economies faltered.
Zimbabwe (2007-2009)
Zimbabwe witnessed one of the most dramatic periods of hyperinflation in the late 2000s, with the rate peaking at an astronomical 89.7 sextillion percent per month in November 2008. As the Zimbabwean dollar became virtually worthless, people resorted to barter trade and use of foreign currencies. Gold, which is abundant in Zimbabwe, became a critical means of trade, with miners and individuals exchanging it directly for goods and services.
(Source: Hanke, S. H., & Kwok, A. K. (2009). On the Measurement of Zimbabwe's Hyperinflation. The Cato Journal.)
Argentina (2001-2002)
Argentina's economy collapsed in the early 2000s due to a multitude of factors, including high external debt, fiscal mismanagement, and a rigid currency peg to the U.S. dollar. Amidst the crisis, with bank withdrawals restricted and the peso's value plummeting, Argentinians turned to various forms of barter clubs, while gold and silver jewelry often served as an unofficial currency.
(Source: Dell’Ariccia, G., Detragiache, E., & Rajan, R. (2008). The Real Effect of Banking Crises. Journal of Financial Intermediation.)
Venezuela (2016-Present)
Venezuela's ongoing economic crisis, characterized by hyperinflation, began in 2016. With the bolívar virtually worthless, citizens turned to gold as a form of currency. In the country's gold-rich regions, gold nuggets have effectively replaced the bolívar for everyday transactions, underpinning a form of "wildcat banking."
(Source: Corrales, J., & Penfold, M. (2021). Dragon in the Tropics: The Legacy of Hugo Chávez. Brookings Institution Press.)
These instances vividly illustrate how societies instinctively return to the intrinsic value of silver and gold in times of economic crisis. As symbols of stability, these precious metals serve not only as a means of preserving wealth but also as functional mediums of exchange when fiat currencies fail.
Prepping for Economic Collapse and Hyperinflation
The philosophy of prepping, rooted in self-sufficiency and preparedness, emphasizes readiness for potential societal disruptions or crises. While food storage, firearms, ammunition, tools, seeds, and other essential items are commonly advocated within prepper circles, this article will shed light on the importance of incorporating precious metals like gold and silver into a comprehensive preparedness plan.
Precious Metals as a Safe Haven
In uncertain economic times, gold and silver have traditionally served as safe-haven assets. Unlike paper currency or digital funds, their value does not depend on any country's economic stability or a functioning banking system. Their historical worth and universal acceptance make them reliable mediums of exchange in the event of economic turmoil or the collapse of fiat currency systems.
Food Storage: A Hedge against Shortages
Food is a basic necessity, and disruptions in the food supply chain can have catastrophic effects. By maintaining a stockpile of non-perishable food items, preppers can ensure sustenance for themselves and their families during prolonged emergencies. It's prudent to store a variety of nutrient-rich foods, including canned goods, grains, and dehydrated meals, to ensure a balanced diet.
Firearms and Ammunition: Security and Protection
The maintenance of personal security is a priority in survival planning. In times of social unrest or lawlessness, firearms, and ammunition can provide a means of self-defense. However, they should always be handled responsibly, with comprehensive knowledge of safety protocols.
Tools: For Building and Repair
Having a range of basic hand tools—such as hammers, saws, and screwdrivers—is essential for construction, repairs, and countless other practical tasks in a survival scenario. More specialized items, like water purifiers or portable solar panels, can also offer substantial benefits.
Seeds: A Sustainable Food Source
In addition to stored food, having a collection of seeds can provide a sustainable source of fresh produce over time. Gardening also imparts valuable skills and can improve physical and mental health. Opt for a variety of heirloom, non-GMO seeds to ensure biodiversity and the ability to save seeds for future planting seasons.
To sum up, prepping is about preparing for the unexpected, and precious metals like gold and silver can play an essential role alongside other survival items. It's important to remember that each person's preparedness strategy should be tailored to their specific needs and circumstances.
Please note, this article is intended to provide an overview and does not constitute professional financial or survival advice. Always research thoroughly, consider professional advice, and ensure your actions are legal and safe.
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M.D. Creekmore
Thanks MD. Very informative. I am fairly new to gold and silver.
You put so much time and thought into the information you provide to us, and so very well written. Thanks very much.