Monday, September 3, 2012

Survival Cash For After The Disaster

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Original Article


After a disaster or a deflationary economic collapse, CASH will be King… for awhile. During an inflationary economic collapse (which would be runaway hyperinflation), GOLD and SILVER and other commodities will be King. Well, actually either way, Gold and Silver holds its value with respect to buying power, but I’m getting off track. What I’m trying to say is that having a quantity of cash (yes, Fiat paper funny money), will be invaluable for awhile after a disaster.
Almost all of the current money supply is electronic money, digits, computer data entries… it’s not cash. Most of the so called wealth in the world today is actually ‘credit’… promises to pay. That’s not cash however.
Statistically, only only a very small fraction of today’s money supply in the United States is actually physical cash or coin! This is known as the M0 Money Supply. Although the real percentage is elusive, it is apparently quite less than 10% of all ‘money’.
So think about that. Nearly all of the transacting that occurs in day-to-day purchases are electronic digits. It’s no surprise to most of us that this is the way it is. Having said that, imagine getting through ‘days’ without the availability of the electronic systems that allow us to purchase the things we purchase.
Most merchants will take cash. While some merchants cannot accept cash when the power is down, most smaller shops will not be bound by electronic systems of payment.
Given that today’s ‘savings’ interest rates are near zero and NOT worth the miniscule rate of return to keep money tied up in the bank, why not keep some for yourself? Even though the dollar is slowly (sometimes not so slowly) being eroded and devalued, when it comes time for collapse or disaster, those with cash will be able to buy the ‘things’ that they will need.
It won’t be until later on during a major collapse when some merchants may realize that things may not be the same again for quite some time (if ever) and start accepting silver coins, barter, or other commodities in exchange for goods. Not until they are convinced that the present system is ‘over’. Until it gets really bad, people will hang on to their belief that things will get back to normal. Maybe they will, maybe they won’t. In either case, having a cash stash could save your a$$.
Don’t let on though that you have cash. Unfortunately, today it has become almost taboo to have lots of cash. It is truly amazing actually. People that see you with a large sum of cash may look at you in near horror or amazement, as though you are carrying contraband. A person could spend $300 on something without a second thought while using their electronic money, but if they see a wad of cash totaling $300, it somehow seems like it’s a lot of money… Go figure.
In any event, think about it. Convert your digits to cash. Not only will it provide you a layer of financial security (to a point), but if you substitute a portion of your electronic spending with cash-only spending, you may be surprised at how you pull back the reins. Psychologically and comparatively, cash money in your hand feels like more money than electronic (invisible) money.

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  1. In an economic collapse will cash have a value? maybe for a short period. Will gold and silver be of value? I just find that hard to believe it, if things hit the fan. It would seem more probable that foods and necessary goods that meet human needs would be the better bargaining tools. I mean you cant eat gold or silver, or keep you warm. The other thing is in a collapse crime will become rampant and having valuables such as this may be a compromise of your security.

  2. Exactly Max, I've thought the same reading this article. From historical point of view, it is very naive to believe that any valuables that are used or used to be as money would surely posess their value after the disaster.

    Gold and silver were the valuables/money in our culture since Ancient Egypt or even before, but in pre-columbian America they've had only decorative value, something like marble today. After the conquest of America the amount of gold and silver have increased so greatly, that there was a large inflation. The same, but with even stronger effect have happend with cowry shells in Africa. What is the value of the cowry shells today? What would it give to you to have a lot of them in your survival cache?