If we think (and there have been numerous posts here to support this idea) that all major banks are going to fail because of over-investing in derivatives, what should we do if we have money in those banks? Pull it out in cash? Convert it to silver or gold? Put the cash under our mattress? And will cash be worth anything?
So if we have cash in checking or savings with a bank, how can we protect our assets?
I think gold and silver are worthless. You're not going to walk into a grocery store with gold shavings and buy bread. I would suggest stocking up on tangible things you WILL need like food, water, and guns. Have a 6 months stockpile of everything you and you're family need.
"I think gold and silver are worthless."
Meaning you don't have any, right?
"You're not going to walk into a grocery store with gold shavings and buy bread."
This is exaggeration for effect. No one expects to use gold for tiny purchases.
Gold, silver after you burn thru the 6 months of food will buy you food and anything else you need. You don’t have to have 1 ounce gold, you can buy fractional gold - 1/10 ounce. Another thing. What if your neighbours or friends that have nothing hear about your stored food? Cooking smells among hungry people travels far. And if you have to flee, gold and silver can help you establish in a new location. And yes, until this thing work’s itself out, people will trade in gold and silver. It’s been money for thousands of years. What’s to say there will even be grocery stores? When SHTF, there will be some A grade predators about in gangs. The police will be nowhere to be seen because they will be overwhelmed. Gold and silver are insurance. You can flee with it quickly.
The grocery stores will be bare within a day, and all your stored food is gonna just be some much crazier persons loot, unless you live on a farm. Any population center is gonna be complete chaos.
The idea behind having gold and silver is that there will be people in places that are stable and they aren't just gonna give you stuff for free, or for paper that's worthless. The Amish will trade you bread and corn and beef for silver.
Plus if the scenario goes the other way and it doesn't descend into chaos, but the current system dies then silvers historic value will come back and it will be worth a ton, and you will have a bead start rebuilding.
Even in this current system more and more technologies are requiring silver. So if somehow this system staggers on for a few more years itll still go up in value. So in every scenario silver will be useful.
Great points.
Yup, I've done that. Just wondering what will happen to bank assets when TSHTF.
In Europe, a few years back, anyone with a cash balance in a Cypriot bank lost it in what they called a bail-in, which used customer deposits to pay the banks debts, The customers got IOUs.
Did the IOUs ever pay out? And if so, how soon after?
https://www.investopedia.com/articles/markets-economy/090716/why-bank-bailins-will-be-new-bailouts.asp
This article explains what happened and suggests that this will be the way that the Banks try to stay afloat.
It seems that the Cypriot customers lost 47.5% of their deposits, they don't mention it, but IIRC the customers were given shares in the bank, but had to keep the shares for a period of time before selling them.
so what will you be using to buy your bread ? Gold can be clipped by weight and will command more purchasing power that most other assets, even for bread.
By clipped, I mean that a 1 ounce coin or bar can be cut into smaller bits, for transactions, same with silver. Precious metals will be universally be accepted as payment in times of major unrest, as it is in peacetime.