FIAT money - could it really happen/ has it happened?

Read again what I wrote. The federal reserve notes of the 1930's were NOT fiat money as they were convertible to specie in silver at home and gold abroad. They did not become a fiat currency until all silver backing (1968) and gold (1971) were removed. Only then, 45 years ago, did USA currency become a fiat currency. Take a look at one of the Federal reserve notes of the 1930's and you will see that they were redeemable. That promise to redeem them was later removed. Also if you look at the French notes of the Third Republic they were in circulation from the 1870's to 1940. Tsarist Russian notes were in circulation for many decades before the collapse of the monarchy. No, I don't see a lost war or a revolution on the horizon but I'll bet the French and Russians and Germans didn't either. The salient fact that remains is that there are scenarios which the US economy is not immune from which could come with little warning that could undermine the basis of a paper currency based on faith and credit. The possession of bullion, not for short term speculation, but as an insurance policy against things "that go bump in the night" is prudent as history abundantly demonstrates.

 

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There's a fatal flaw with the stacking for a potential civil war or revolution though, modern weaponry. Modern weapons would make the civil war and any past revolution look peaceful by comparison. You wont be lugging around gold and silver it would just be bullets and food. Unless you can afford an underground bunker to store it in it would be of no use.

Fiat currency has really been around since the ancient chinese, it actually gives governments and economies more flexibility during down periods which can prevent complete collapses.

The closet example you would really be able to set forth would be the USSR failing but even that is not really all that comparable and fell for numerous reasons.

 

Some life sustaining drugs ( now costing insurance companies $30,000++) , if available would be well over any price a normal stacker or gunnie could paid. Instead just 1 or 2 weapons and ammo, and all of the 'chalky' meds you can stock along with OTC drugs and bathroom needs. I will gladly sell one tube of Antibiotic ointment for 1 oz. of gold

 

Good call on that one, medicines would be EXTREMELY valuable to have in a situation of total break down.

 

You're on a roll today, man.

 

Including.... precious metals!

Gold and Silver have value because humans assign value to them. Just like the, uh...the US DOLLAR!

 

The New Deal did not end the depression, but that doesn't mean it was ineffective either. FDR tried many programs between his inauguration and WWII, some more effective than others. What they did was slow the decline and aid in the recovery. As with our current recovery, the situation improved more for some than for others. But when FDR became president the country seemed to be on a downward spiral and a substantial percentage of the population felt like they had no hope. People were literally starving and living on the streets or in their cars. FDR's programs gave many a source of income that allowed them to survive. They got people working again, put money in their pockets that they were able to spend, so eventually employers would have more business and be able to hire again. They stopped bank failures so people could be confident in saving again. It was only World War II that ended the depression by bringing about full employment for defense spending, but Roosevelt's policies are perhaps what prevented us from ending up like Germany or Italy with a hopeless population rallying behind a strong man who promises to restore prosperity by any means necessary. We were able to do it with deficit spending. Seems like a good tradeoff to me.

 

But if you didn't happen to have gold or silver (or heaven forbid you run out) couldn't you just use say rocks in your slingshot? I do understand that gold or silver would be denser and smaller for the same weight so they would have more penetrating power.