Silver was down a bit the other day, and I had the treacherous combination of a few extra dollars in my pocket and a bit of impulse control issues. As a result, there’s another tube of silver dimes sitting in the safe.
Why? Well, thats an interesting question. Intellectually, I know that the odds of there being an event where greenbacks are worthless and we’re trading silver and gold like some sort of Roman market are pretty slim. And if the world collapses in on itself, its probably more likely that a box of .22 or a package of AA batts will get me more merchandise than silver or gold.
On the other hand…. we have plenty of episodes in the last 100 years where a national currency became worthless and people who had silver and gold were able to get the things they need.
Somewhere between “Current standard of living” and “Mad Max” is where the metals will be handy, in my opinion. Today, you can walk into a 7-11 and Apu might not take silver for a pack of Marlboros, and when the bombs fall and we’re all eating our children it is also likely that silver and gold won’t be very valued. But there’s that in-between….that point where the currency still has some worth but is rapidly becoming worthless, and there is the opportunity to purchase needed items. Thats the sweet spot, I think, for the use of metals.
There’s always the wag who thinks he’s being clever and original with some pithy line abou t how ‘if you can’t eat it it, shoot it, or live in it, it’s worthless’. And yet….he’s at the Kroger paying for his groceries with greenbacks that he can’t eat, shoot, or live in. Hmmm.
Now, I’m not saying that after the end of the world we’ll all be trading silver and gold for our transactions. I’m saying that its during the ride to the end of the world where the metals will have the most utility.
And…for some reason I cannot precisely express… I just feel better having some shiny metal on hand. So…a little more silver in the safe.