You, as an avid reader of SurvivalBlog posts, know a few things for sure: 1. That the spot prices for physical gold and silver metals have been tremendously manipulated and suppressed for decades. 2. That if a huge coronal mass ejection (CME) from our sun (similar to the Carrington Event in August of 1859) strikes our country and our planet, that ALL of the semi-conductor circuits, electrical transformers, and vehicles dependent upon those parts will instantly become inoperable. And 3. That the Dominion Voting machines would not be used in the next elections.
If an electromagnetic pulse (EMP) struck the united States of America tomorrow (heaven forbid), what would the price of physical gold and silver be the next day? And at the end of the first week?! Silver will go to $1,000 per ounce and $20 bill will go to zero.
Whether caused by a natural phenomena hitting Earth’s magnetosphere, an unprecedented cyber-hack computer virus, or a North Korea strike causing a type of geomagnetic storm, you were astute and educated enough to recognize that the power was not going to come back on any time soon (if ever…) you would instantly go into your “prepper mode” and begin to organize your preps into priorities. But without a television or Internet to tell you with a quick click what the daily trading price of an ounce of silver was, how would you know what its bartering-power is currently?
The same could be said regarding ammunition, liquor, toilet paper, cigarettes, and water-purification tablets. Those who know their actual worth and value are reading this article- and those clueless souls will only truly recognize the value in a week or so, when it is waaaaay too late! When all the 1’s and 0’s are replaced by Au and Ag (and possibly old carbon with a crystalline-lattice structure) people will still need something to do their “horse-trading” with. The survivors will need gasoline for their old cars, old motorcycles, old mopeds…and for food once the store shelves have been emptied; furthermore, since silver has been known as “the people’s money” for centuries, I believe it will become “worth its weight in gold” so-to-speak.
I am a voracious reader of multiple “post-apocalyptic” book series, including the 18 Left Behind novels (although the power stayed on in those), the One Second After, One Year After and The Final Day trilogy by William Forstchen, and I mowed through all ten of Glen Tate’s 299 Days books (electricity still on, but very plausible and educational). I am currently being enlightened (double ironic puns intended) by Jack Hunt’s series beginning with Rules of Survival and Rules of Conflict and all 12 volumes of Mike Kraus’ Surviving the Fall series. As such, I glean from others’ imaginations and visions of how SHTF scenarios might play out. But none of them drill down on the money value and exchanging issues.
So you, Mr. and Mrs. Prepared, are sitting prettier than 90% of the sheeple masses who took all their goodies and staples and electronics for granted just 24 hours ago. But, on the newly-needed “Black Market,” what will each item (in each category) actually be worth?! Of course pure water and edible food will soon be at a premium! A safe shelter, a loaded weapon and gardening skills will be paramount. A solid Faith in God, mechanical tool skills for small engine repair, and stabilized gasoline in sealed containers will soon be highly sought after…but those are topics for other articles at another time.
I am choosing to focus on physical precious metals, i.e. silver coins, silver rounds, 90% “junk silver” (pre-1965 US minted coins), and fragments of 1-ounce gold pieces and solid mini-bars. I am not including numismatic collectibles, paper mining certificates, silver stock investments, or large, heavy gold-bar bullion or ingots.
This article is for “where the rubber meets the road” in a post-power-outage scenario. An X-class solar flare and its coronal mass ejection (CME) has just struck the earth and melted all of the transformers and electrical circuits on our fragile power grid and All systems are down…Forever!
You know and I know that the value and prices of these historical commodities (yet not eternal in the “heavenly sense“ because the streets will be paved with the yellow stuff- and in hell it will only exist as liquid molten dross…) that have held their value as actual money for 4,000 years or more will sky-rocket!
Gold and silver, used as money and wealth storage, have been utilized for over four millennia and will stand the test of time once again. I mean, what else ya gonna use…loose diamonds, chicken eggs, IOUs, or crypto-Poof?
I believe that paper US fiat currency will last less than Two Months in a total power collapse scenario! Our current twenties will spike in value rapidly as the masses rush to the dark grocery stores, big-box hardware stores and bulk-food outlets trying to stock up (now that it’s too late). But those who actually have wads of cash will be better off than those with only inert plastic credit cards and worthless cell phone apps!
No Power = No Money
With no power, no banks, no ATMs, no credit cards, no Square, no PayPal, no wire transfers, and no government bailouts coming…what will we use to pay for the exchange of goods and services…? See the graph above for my opinion on what will happen to a Jackson note over the first month.
The world will keep turning, right? And other countries will still have power, won’t they? “They“ will certainly come over and rescue us humanely, correct?
I mean, “We” would arrive quickly to aid them and prop them up and kiss their boo-boos…so we can readily expect others to respond and respect our sovereign nation’s problems without taking advantage of our vulnerabilities… or invading us, correct? Nonsense!!!
We will be toast! Burnt toast…extra black. The concepts of “US” vs “Them” on a global scale would be gone…and then greatly increased on a local scale! Earth’s civilized future will depend on whether the grids are down all over the planet or just here in America! I will focus just on out beloved US of A here.
I am being 100% serious here!
Think of the movie A Good Day to Die Hard when the bad guys caused a “fire sale” breakdown where “everything must go.” That meant power, water, communications, transportations and financial services – gone. Jobs, gone. Shipping, gone. Schools, gone. Stocks, gone. Police, gone. And roving gangs…organized and on the prowl.
When asked if silver would ever reach $1000, Allen Fordham in 2019 on Quora.com blog stated, “I can’t see anything happening this century that would prevent market forces of supply and demand from stabilizing the price of silver far below $1000 an ounce.” This naive, closed-minded simpleton just chose to ignore the two main possibilities I am discussing on this topic (EMP and CME). Sure, put your head in the sand and keep the status quo and metals will stay with a narrow “normal” range…but…meet Mr. Murphy and his catastrophic Law…
An EMP or CME will fry our grid and the whole country is plunged into darkness- Permanently! Because which power company lineman is going to attempt to get in his truck (that won’t start) to go fix the transformers (where would you start and where would you get the replacement parts?) and trust to get paid? (with no banks or direct deposit)…
Nope, everyone (once two days pass and they realize that it is never coming back on…remember that excellent television show Revolution, which I believe they canceled because it was hitting too close to reality) will freak out!
“We are nine meals away from anarchy!”
Okay, back to my scenario…everyone will hunker down and stay off the streets (like the first two weeks “to flatten the curve” of the recent Covid global lock-downs) for the first several days…then…food spoils and then runs out. Cars clog the freeways and roads. Smoldering fires from plane crashes spread…and toilets clog and stink!
What will be worth buying, what will necessities cost, and what will you pay for it with? And what will the sellers accept as payment?!
Now that the disaster-riddled stage has been set, we can finally move deeper into the topic of this article: Payment, Value, and Worth.
It began with rocks, pretty shells, cacao beans, and beads. Then they moved to skins, furs and arrowheads. Sex, berries, crude tools and seeds probably came next. Exchange, commerce, bartering and the precursors to capitalism began…
Fear and panic has set in. The SHTF and now the harsh reality of primal survival kicks in for the people who read this blog-page regularly. Crying over spilled milk, trying to get back home to mommy’s house, or jumping off a bridge are the first choices many of the uneducated and unprepared masses will consider. “The governor or government will be around to fix this…right,” will be their first thought…
“It won’t last that long…we’ll be okay,” they will (incorrectly) rationalize to sound manly and positive to their spouse…
What do You have inside Your house Right Now? What is actually valuable? “If you don’t touch it, you don’t own it” is the mantra you have lived by while preparing for this inevitable day of disaster! Boom! It’s here. No, we did not wish for it…we didn’t want it to actually occur in our lifetimes…and we wouldn’t have wished it on our families, kids, friends or even our enemies…Yet, you did stock up (just in case). Good for you. You’ve got toilet paper and cases of water in the basement. Cans of food, sacks of beans and some fish antibiotics on a shelf from years ago- Excellent. And you gun-safe has a few weapons of various types and boxes of ammo that you haven’t use or practiced within months- But you are way better off than the other 90% of your city…
However, your bank account is gone! Your 401k is history. And your job is no-longer…it is eerily quiet and Dread sets in… Oh, Crud! What are we going to do? You have realized the monumental catastrophe that has befallen our beloved country…and you wanna throw up!
You go into your documents safe and pull out the bags of coins. Not enough (of course, Gulp) but you gingerly count out your stash…at least you have some real valuables there. You bought some when it was $13 an ounce and some more when it was $21. Now you’d pay $50 happily! Cuz it’ now worth $100 per ounce!
Or is it? How do you know? Monex.com is gone. Kitco.com is no-longer, and the television won’t turn on to tell you what the hell has actually happened. You are in the dark (figuratively and literally). The silver stuff splayed out on your bedroom floor (behind closed doors and covered windows) is now part of your life-line to animalistic survival. Survival of the fittest has taken on a whole new (gut-wrenching) reality. Metals for life. Barter for necessities. Trade to eat. But with whom? And on what scale?
How come nobody ever covered this before? How come some economist never did a youtube video series or podcast on this vital topic? Because nobody knows how to scale it. And nobody wants to breach the ultimate disaster possibility and be called a fear-monger. Doom-and-gloom purveyor. Yuck. Avoid, avoid, avoid…
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Yet, you asked for it. I am writing this for a “prepper blog“ that asked for info on TEOTWAWKI so here it goes…
Your silver and gold will skyrocket…for a while. Even your paper fiat currency will go up in value, temporarily…and then plunge down into scrap for lighting cooking fires. But the precious metals will hold their values longer and stronger, because that’s what Real Money does. It has for over one hundred generations, and I believe it will now. Junk silver coins are recognizable, portable, tangible, fungible (able to be broken up into smaller denominations, i.e. five Dimes for two Quarters) and non-decaying. Those are good, solid traits to have! The Constitution For the United States of America states, “The Congress shall have Power…to coin money, regulate the Value thereof…and fix the Standard of Weights and Measures…” (those capitalized words are called Caponyms and it means that the Founding Fathers thought those words were very important- like bold and italics today). Article 1, Section 8, Clause 5 lists this as a rightful job of the government. Normalcy bias says these will be ideal.
“Gold and silver are the only substances which have been and continue to be, the universal currency of civilized nations. It is not necessary to enumerate the well-known properties which rendered them best fitted for general medium of exchange. They were used…from the earliest of times…And when we see that nations, differing in language, religion, habits, and on almost every subject susceptible of doubt, have, during that period on near (over) four thousand years, agreed in one respect; and that gold and silver have, uninterruptedly to this day, continued to be the universal currency of the commercial and civilized world, it may safely be inferred, that they have been found superior to any other substances in that permanency of value.” – Albert Gallatin in 1831.
He was the longest-serving Treasury Secretary (1801-1814). This statement will be tested in the furnace of post-EMP or post-CME outages.
“B-B-But where is the Congress today…?“ In the dark, like everyone else! The US Mint is permanently closed for business. So, now we have a limited/ finite supply of coinage available. Bitcoins (and the like) are powered-down (so much for $50,000 each) and crypto-trading is over. Poof!
(To be concluded tomorrow, in Part 2.)