Gold and Silver as Money

Since times of old, gold has served humanity as both a store of value and a medium of exchange. Presently, using gold as money seems to be entirely out of place in a world which is moving toward the elimination of currency and its replacement with debit and credit cards and even cyber-money. But still the possibility of an economic crash has made many investors to put some gold away specifically for the purpose of buying essentials, if things were to get worse.

In most cases (even a breakdown), the owners of gold would sell their gold for the currency which is being used at the time through the services of a gold exchange, and after use that currency at the store to purchase whatever it is they desire to purchase. Yet, some people believe that in an exonomic breakdown with no dependable currency alternative available, citizens will resort to hand-to-hand barter transactions between individuals wherein gold would be directly used as a currency.

Small Gold Bullion Coins
The smaller gold bullion coins (1/2, ¼, and 1/10 ounce) serve these purposes best. The ¼-ounce coin is the most useful of that group. Most of the nations that mint gold – including Australia, Canada, and the United States – produce coins in the ¼-ounce size. These coins are big enough to easily pass as currency from buyer to seller. They can be stacked, stored, and accumulated without the worry of losing a coin or two in the process – something that can’t be said for the smaller 1/10-ounce coin. The premium is slightly higher on the ¼-ounce coin (over the 1-ounce coin), because the cost of making a coin is roughly the same, the size of the coin doesn’t matter. The more gold in the coin, the smaller the premium per weight because the price of making the coin is amortized over a larger quantity of gold.

The people who foresee a potential for using gold as money and who are worried with confiscation and privacy matters might take owning the uncirculated pre-1933 Eurpoean gold coins as a medium exchange into consideration. These items approximate 1/5 to ¼ ounce of gold. When you buy goods, there are no reporting requirements on these coins for you or the seller, and they give an extra degree of protection with respect to potential confiscation.

Using Silver Coins
You might want to take a couple bags of silver coins into consideration – 1,000 dollar face value, pre-1965 U.S. silver coins. The old standard recommendation of one bag per family member living with you still stands. U.S. silver dollars are still recommended occasionally for this purpose, but the premium is relatively high. The greatest advantage of silver dollars is that they fall under the 1933 dateline with respect to confiscation. Silver rounds and one-ounce silver coins of many manufactures, including the Canadian and U.S. mints, are another option, although the premiums are relatively higher.

Having money to barter could be crucial during an economic breakdown. It makes sense to have some gold and silver stored away for this purpose. This is not a complicated dilemma. This advice should suffice in the event of a breakdown.