Thought on Hyper Inflation

[PatMarlin]

You hear all the gold commercials and warnings of hyper inflation hitting the US by printing money, and devaluing our currency.

The picture painted is like the 30's in Germany with wheel barrows full of worthless cash overnight. One load will by a loaf of bread. I happen to have a fresh un-circulated stack of the bills a GI brought back and gave to my Grandmother from the war.

But here's the thing... if you have something of value, you can sell for boat loads of worthless bills during hyper inflation, couldn't you take those bills in and pay off your mortgage? After all, they are face value dollars, and that's what your mortgage was written on right?

Most wheel barrow paper holders in Germany I suspect didn't own property, or hold mortgages.

[garym1a2]

think of the late 70's where interst rates on homes where 15% and inflation was also. Home values rapidly went up.

[PatMarlin]

My point is, say you sold some much needed items like reloads or something, for wheelbarrow loads of cash, then went down and paid your mortgage off in cash. Face value. Why wouldn't that work? Could it actually be good to be upside down or heavy on a mortgage, during a time like that?

[Epd230]

You are exactly right. As long as your mortgage is on a fixed rate. Otherwise, your rate will raise as fast as the contract will allow. Future borrowing will be at the increased interest rate.

For those of us with a fixed rate mortgage, and valuables to sell. It could be good.

Keep in mind though, who are you going to sell your valuables to? With run away inflation, the general public will fall behind and suffer greatly. Discretionary income (like we have that now) will shrink and every dollar earned will go toward paying the rent, groceries and utilities.

If your income has the ability to increase with the economy, then you should be good. Others, on a fixed income, or who work under multi-year contracts will fall behind.

[PatMarlin]

Ya fixed rate for sure.

How did they earn the loads of cash back in the 30's? Who had it?

Like to know.

[Catshooter]

You are correct in your thinking Pat. As long as you and your lender are bound by your contract you're good to go.

I Germany, from what I understand, those employers who could would raise the employee's pay, sometimes daily. Very ugly.

If it were to happen here, you can bet your bottom dollar that as quick as it could the mortgage industry would lobby DC to get a change in place where their (and your) contracts could be modified so they wouldn't get hurt so bad. As it is now once you sign and they accept the contract it can't be modified without consent from both parties.

But before that happened yes. If you had say an AR 15 and sold it for $35,000 cash you could then pay off your $30,000 mortgage. Just do it before the laws change. :)


Cat

[popper]

From what I remember those who went through the depression, it was those who were over leveraged who suffered most. Wasn't good for most but they survived. Present conditions aren't the same. Hitler had to have a war to take over, the country was already in the world depression. Real property is god if you own it and can find a buyer when needed, for a proper price.

[Blacksmith]

Yes you will be able to pay your mortgage off with inflated dollars assuming you can get the dollars. Most peoples sources of money are either from employment or investment. In a hyperinflation these are affected also because many businesses fail and investments in things like bank accounts or bonds are made worthless by inflation. If you have hard goods to trade you can get cash if you can find anyone who still has it who wants what you have. Most hard goods will be bartered for other goods. If you intend to pay off a mortgage based on the hyper value of money you probably want to buy some gold or silver to cover your mortgage because it will be more liquid and more readily converted to cash. Depending on who holds your mortgage you may be able to handle the complete transaction at the same bank.

If you believe the inflation is coming and you have some cash investments to spare you might consider putting some of your cash reserves into precious metals backed ETF's (symbol GLD, SLV, SIL, IAU, PPLT, etc). These type investments should track the inflation fairly closely increasing in value at a rate that keeps pace while the cash investment will decline along with the value of the money. You won't get rich (make a lot of money except on paper), but will have inflation protected funds to pay off the mortgage.

Example:
Today Gold is $1,300 per oz. it will buy one good rifle or 371 gal. of $3.50 per gal.gas.
You have a $26,000 cash investment.
You split your investment in two.
$13,000 cash (equal to 10 oz. of gold)
You buy $13,000 in ETF's (equal to 10 oz. gold)

Inflation happens!

Gold is now worth $6,500 per oz. will buy one good rifle or 371 gal. of $17.52 per gal. gas.
You have $13,000 cash (equal to 2 oz. of gold)
Your ETF's are worth $65,000 (equal to 10 oz. of gold)

HYPER Inflation happens!!!!!

Gold is now worth $260,000 per oz. will buy one good rifle or 371 gal. of $700.80 per gal.gas.
You have $13,000 cash (equal to 0.05 oz. gold)
Your ETF's are worth $2,600,000 (equal to 10 oz.of gold)

[Taylor3006]

I doubt the USA will ever see hyperinflation, we are a debtor society and tons of money floating around would allow many people to get out of debt. Lending institutions would crumble. Stagflation is a much more likely scenario and we are seeing a bit of that now. Essential products (food, energy, etc) go up in price and nonessential things (iPods, DVDs, etc) go down in price in a manner that overall the inflation rate stays the same. In other words you might not be able to put food on the table but you can starve to death while watching yer favorite movie.

[MaryB]

Stay far away from precious metals ETF's!!! Most are very over leveraged with 300oz paper silver to 1 oz real silver, gold is around 100:1 with 100 oz paper to 1 oz real gold.


Yes you will be able to pay your mortgage off with inflated dollars assuming you can get the dollars. Most peoples sources of money are either from employment or investment. In a hyperinflation these are affected also because many businesses fail and investments in things like bank accounts or bonds are made worthless by inflation. If you have hard goods to trade you can get cash if you can find anyone who still has it who wants what you have. Most hard goods will be bartered for other goods. If you intend to pay off a mortgage based on the hyper value of money you probably want to buy some gold or silver to cover your mortgage because it will be more liquid and more readily converted to cash. Depending on who holds your mortgage you may be able to handle the complete transaction at the same bank.

If you believe the inflation is coming and you have some cash investments to spare you might consider putting some of your cash reserves into precious metals backed ETF's (symbol GLD, SIL, IAU, PPLT, etc). These type investments should track the inflation fairly closely increasing in value at a rate that keeps pace while the cash investment will decline along with the value of the money. You won't get rich (make a lot of money except on paper), but will have inflation protected funds to pay off the mortgage.

Example:
Today Gold is $1,300 per oz. it will buy one good rifle or 371 gal. of $3.50 per gal.gas.
You have a $26,000 cash investment.
You split your investment in two.
$13,000 cash (equal to 10 oz. of gold)
You buy $13,000 in ETF's (equal to 10 oz. gold)

Inflation happens!

Gold is now worth $6,500 per oz. will buy one good rifle or 371 gal. of $17.52 per gal. gas.
You have $13,000 cash (equal to 2 oz. of gold)
Your ETF's are worth $65,000 (equal to 10 oz. of gold)

HYPER Inflation happens!!!!!

Gold is now worth $260,000 per oz. will buy one good rifle or 371 gal. of $700.80 per gal.gas.
You have $13,000 cash (equal to 0.05 oz. gold)
Your ETF's are worth $2,600,000 (equal to 10 oz.of gold)

[Taylor3006]

Stay far away from precious metals ETF's!!! Most are very over leveraged with 300oz paper silver to 1 oz real silver, gold is around 100:1 with 100 oz paper to 1 oz real gold.

AMEN! If you don't have it in yer hands, you don't own it.

[uscra112]

I doubt the USA will ever see hyperinflation.....

Ding-ding-ding we have a winner. Central bankers are running a "small" amount of inflation (2% per year is the target) because they know how to control that. What they wake up screaming in the night over is the possibility of deflation.. All this paper money they've created has value only because people believe it does. If (well, when, actually) humans lose that faith, the masses panic, and the money supply collapses, oh, say 70%, almost overnight. Central bankers admit that they have no tools to stop it - none whatsoever. Deflation kills banks even worse than inflation, and the bigger they are, the harder they fall. And since the banking giants control not only the Fed but the Treasury, they will keep us in thrall with a steady drip, drip, drip of 2% per annum. Unless the comet hits, or a Coronal Mass Ejection causes a planet-wide EMP that kills power grids, in which case it's Katy bar the door.

If you insist on precious metals, only what you hold on your hand has value in any crisis. "Funds" really are just paper promises, and their value will vaporize in any deflationary crisis.

And of course I recommend keeping your metals investments in lead and brass.

[starmac]

I don't know abut Hyper inflation, deflation, or even gold or silver, but iffen a guy would have invested 10 grand in 22 ammo a few years ago, he might have been able to pay off a hefty mortgage this last year. lol

[Blacksmith]

Stay far away from precious metals ETF's!!! Most are very over leveraged with 300oz paper silver to 1 oz real silver, gold is around 100:1 with 100 oz paper to 1 oz real gold.

Could you please provide a reference to this statement? GLD and SLV for example net asset value NAV is based on the value of the precious metals holdings less the management fees and the holdings are audited.

[Blacksmith]

Any investment plan or strategy needs to be thoroughly researched and understood. Also each individuals circumstances must be considered. Finally any plans need to be diversified in order to spread the risk over various assets that will respond differently depending on the economy. Note in my OP I used terms like some and spare and targeted a very specific set of circumstances.

Every investment or strategy has pluses and minuses and you need to understand them by doing your own research. Physical gold and silver have their place and have both good points and bad. Good points being you control them, smaller amounts are portable and can concentrate your holdings in a widely acceptable form. Some down sides are it can be stolen, gold in particular may be difficult to use for smaller purchases, they can be less liquid and incur costs because of assay issues. That being said I think most people should own some physical gold and silver but for hedging a inflation mortgage payout the ETF's have advantages. You also need to understand the tax rules for precious metals which are different from most investments.

All investments operate within a greater economic framework and the investor needs to study the economy and make choices based on what they think will happen. Once again don't put all your eggs into one basket and be sure you have built in contingencies for various economic outcomes.

To start your economic study here are a couple of links. Read them decide what you think is most likely then take steps to protect yourself which ever happens.

Hyperinflation:
http://en.wikipedia.org/wiki/Hyperinflation

Deflation:
http://en.wikipedia.org/wiki/Deflation

Lots of things can be done the important thing is do something. Remember there is no one size fits all solution in investing you have to tailor it to your particular needs.

[Cactus Farmer]

My friend from Rhodesia (Zimbobway for the Robert Mugabe fans) has a Trillion Dollar bill. That's $1,000,000,000,000! It won't buy a loaf of bread and it's too slick and not very absorbant for wiping with. I'm all but debt free so paying off a loan is not so good a deal for me. I am beginning to aquire physical assets that I can trade for what I don't have. I have diesel,ammo, ect, you have gasoline,food,water,tires ect, we just trade. Obummer will pay he!! taxing that!

[popper]

Get this through your skull - inflation & deflation are the SAME thing. Both are a devaluation of that stuff we call money. It is caused by an excess of 'coinage' beyond the capability of the economy. Commonly called overspending by the Gov. Always has been, always will be. All of the market, ETF, precious metals, etc. are over leveraged, just like the $.

[captaint]

Seriously, do we think the BANKS would allow that to happen ?? Not a chance. Remember what happened at the beginning of the depression. Of course, I wasn't around for that either, however, the gubment made all of the paper money in circulation null & void. New bills were issued and the monetary system started all over. Mike

[garym1a2]

When you have high inflation and a fixed mortage you want to keep the mortage forever. When you have low inflation and/or a varable mortage you wantto get rid of the mortage. Assuming you have a good source of income.
If your income is limeted you want to get rid of all dept for the lean times as hyper-inflation also could mean low income and no job.

[PatMarlin]

Very thought provoking points.

I'm not a doomsday prepper, but I like being prepared and with means to take care of myself and my family. One area that I think the US is vulnerable is the power grid. If some these well meaning, hard working immigrants that are allowed to cross our borders happened to be organized terrorists, and they figured a way to take down our power, inflation or not- we would be in big trouble.

If that happened and all you had to do for months on end is trade in your community, you're going to trade goods and services, and currency correct? The currency you have on hand which for most of us is dollars and coins.

If you buy into the radio hype of getting all of your money into gold currency, how's that going to help if you can't cash it in for market value dollars to trade with your neighbors? Even small gold coins aren't gonna do much with the grid down. Maybe.

I think maybe a good hedge for cash on hand would be silver coins, maybe even 60% coins, as you could easily trade with those, and when the world came back online, you would still have a hedge somewhat on inflation.

Makes no sense to me to have kuggerands on hand to trade. With the markets open and exchanges open yes, but if their computers aren't going to be up and running, you're gonna want some greenbacks and change to trade in your community.

During the hurricanes back east, one of the biggest issues for getting goods and fuel from the vendors who were open and had supplies on hand was change. No one had change. Couldn't break hundreds, and twenties even. What good is a valuable coin gonna do you?

[Garyshome]

You have an oz. of gold and are very hungry? I have a can of beans and am not so hungry. Wanna TRADE?

[PatMarlin]

My point exactly.

[savagetactical]

I have seen mention of precious metals, more than once in these types of scenarios. The one thing people do not grasp is that while yes Gold and Silver have a level of intrinsic value. It is still only worth what someone will give. Personally in a society where cash has cratered and lost its value. Gold and Silver are very low on my priority list of important things to obtain. I doubt very seriously I would be in a trading mind frame of trading my durable goods for something that has monetary value that is in flux at all time and since the real value of precious metals is tied to those fiat currencies , their worth is not as much as you think they are when money has little to NO value.

[PatMarlin]

Buddy of mine emailed this morning-



Scary Obituary.....and it is occurring as you read this...

In 1887 Alexander Tyler, a Scottish history professor at the
University of Edinburgh , had this to say about the fall of the
Athenian Republic some 2,000 years prior: "A democracy is always
temporary in nature; it simply cannot exist as a permanent
form of government. A democracy will continue to exist up until
the time that voters discover that they can vote themselves generous
gifts from the public treasury. From that moment on, the majority
always votes for the candidates who promise the most benefits from
the public treasury, with the result that every democracy will finally
collapse over loose fiscal policy, (which is) always followed by a
dictatorship."

"The average age of the world's greatest civilizations from the
beginning of history, has been about 200 years. During those 200
years, these nations always progressed through the following sequence:

From bondage to spiritual faith;
From spiritual faith to great courage;
From courage to liberty;
From liberty to abundance;
From abundance to complacency;
From complacency to apathy
From apathy to dependence;
From dependence back into bondage."
The Obituary follows:

Born 1776, Died 2012
It doesn't hurt to read this several times.
Professor Joseph Olson of Hamline University School of Law in
St. Paul, Minnesota, points out some interesting facts concerning
the last Presidential election:

Number of States won by: Obama: 19 Romney: 29

Square miles of land won by: Obama: 580,000 Romney: 2,427,000

Population of counties won by: Obama: 127 million Romney: 143 million

Murder rate per 100,000 residents in counties won by:
Obama: 13.2 Romney: 2.1

Professor Olson adds: "In aggregate, the map of the territory
Romney won was mostly the land owned by the taxpaying citizens of the country.

Obama territory mostly encompassed those citizens living in low
income tenements and living off various forms of government
welfare..."

Olson believes the United States is now somewhere between the
"complacency and apathy" phase of Professor Tyler's definition of
democracy, with some forty percent of the nation's population
already having reached the "governmental dependency" phase..

If Congress grants amnesty and citizenship to twenty million
criminal invaders called illegal’s - and they vote - then we can say
goodbye to the USA in fewer than five years.

If you are in favor of this, then by all means, delete this message.

If you are not, then pass this along to help everyone realize just how
much is at stake, knowing that apathy is the greatest danger to our
freedom..

[Abenaki]

Gold is not for buying a can of beans.
It is a way to keep you wealth....to rebuild with latter on.

In a hyper inflation situation, like Germany. You would go to the store, get a can of beans for $20. by the time you hit the check out counter it was $30. By the time you got to pay for it, it had reached $40.

A few years ago, when my Daughter was in college. She had a room mate from some other country.
Not sure which country. but they had bad inflation.
She told my Daughter, that as soon as you got paid, you spent it. for every second that you held on to your
money, prices were climbing.

If you think that the banks are gonna let you pay off your house loan of $100,000. With hyper inflated money, When you are making $200,000 an hour on your job. You are crazy. Remember....they have friends in Washington......we do not!

Study history.....and do the math!
Abenaki

[PatMarlin]

Yea but like Cat said, if you can get the cash to your mortgage before Washington can act, you got em'.

Be ready... :mrgreen:

[Abenaki]

Bingo!!!

Take care
Abenaki

[GOPHER SLAYER]

Being the age I am, I remember the depression very well and it lasted until Pearl Harbor was bombed. None of the things FDR did helped , in fact he only made things worse. Europe came out of the depression before we did. FDR stole the countries gold supply and it was illegal to own for decades. We were taken further down the road to ruin by another acronym, LBJ. He removed silver backing from are money and an inflation chart starting in 1964 until now will show the disastrous results. I can give my families case as an example. My wife and I were married in 1958, we both worked for five years until she became pregnant. At that time we bought a new home, stocked it with new furniture including wall to wall carpet. We had a car that was only two years old and we had money in the bank. Our house payment was never over 130 dollars a month and that included ins and property taxes. The great society LBJ wanted to build has left us with more poor than ever and it will only get worse. It isn't hard to predict the future with libs in charge. All you have to do is look at the past and magnify by ten. I believe if a major crash comes owing a large gold supply won't help you much , if at all. Actually, in my opinion , very little will help. It will be very bad indeed.

[Smoke4320]

You have an oz. of gold and are very hungry? I have a can of beans and am not so hungry. Wanna TRADE?
I have a gun and ammo and are hungry... do you want to give me your beans or suffer the consequences
strange how a few items can change the conversation completely

[shooter93]

Who knows how deep it could get or how long it would last?....no one. It's all guess work. Gold and Silver despite being good in the past could become worthless too. 22 ammo may be the next gold standard. You decide what course is right for you and take it and then hope it was right. If it's bad enough anything you have in your possesion that becomes valuable becomes a target to someone who wants it. While many think no problem...I'm heavily armed....they may be too and there could be a 100 of them.

[Taylor3006]

You have an oz. of gold and are very hungry? I have a can of beans and am not so hungry. Wanna TRADE?
Just wondering how many cans of beans a doctor will want to treat you when you need medical care or a dentist to fix yer teeth..... Gold and silver are a store of value, arguing against holding them is arguing against 4000 year of human history and shared experience. If I am holding gold, what makes you think I don't have any beans in my larder? Only an idiot would put all his money into one commodity and not diversify.

[starmac]

Only the fairly wealthy could hold much gold through the bad times. That said the ones that were would be the foundation getting things started again in the aftermath.

[Blacksmith]

How many cans of beans do you think it will take to book passage on or bribe the captain of the last ship leaving before the zombie hoards arrive.

[starmac]

LOL which paradise would that ship be headed. lol

[MaryB]

COmex has 6.9 million oz silver in stock, SLV claims it has 7.4 million oz. Where is the rest? Plus where is the rest for all the other silver etf's? http://jessescrossroadscafe.blogspot.com/2013/10/gold-daily-and-silver-weekly-charts_9.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+JessesCafeAmericain+%28Jesse% 27s+Caf%C3%A9+Am%C3%A9ricain%29



Could you please provide a reference to this statement? GLD and SLV for example net asset value NAV is based on the value of the precious metals holdings less the management fees and the holdings are audited.

[uscra112]

Get this through your skull - inflation & deflation are the SAME thing. Both are a devaluation of that stuff we call money. It is caused by an excess of 'coinage' beyond the capability of the economy. Commonly called overspending by the Gov. Always has been, always will be. All of the market, ETF, precious metals, etc. are over leveraged, just like the $.

Sorry Popper, but inflation and deflation are most emphatically NOT the same thing. In fact they are polar opposites. Inflation is an increase in the supply of money over and above the growth of productivity in the economy. You have that right. This comes about by debasement of the currency, as in Roman times when they alloyed lead and tin into the silver and gold coinage, or comes about by increases in the amount of debt, as happens in modern economies that depend on foat money. Debt is money, to an economist. The borrower has the money, and the lender thinks that he too has the money, because he thinks he can demand it back from you at any time. So the both go their merry way, until suddenly the lender realizes, "Oh, $@&x!, that loan ain't ever gonna be paid back!" The value the lender thought he had, i.e. the "money" created by his half of that loan, simply vanishes. THAT is deflation - a shrinkage of the money supply, usually due to debt bubbles bursting. In that scenario, prices for material goods fall because nobody has the money to buy them. After the Revolutionary war is an excellent case in point. The economy had been blown up by the issuance of paper money, which suddenly became worthless as colony after colony repudiated it, when they found that they could not tax the farmers enough to pay it off. The amount of gold and silver in circulation was small. Farmers could not get their hands on any, so many of them were forced into bankruptcy, and when the sheriffs went to auction off their goods, the prices were pitiful, because nobody had any gold or silver to buy with. And THAT, by the way, was the primary reason that we got a Constitutional Convention, and our beloved Consitution.

Sorry for the long response, but before I became an enjineer, I was an economist :oops:

[MaryB]

You have a can of beans I need(not really I have my own but...) I have all kinds of 90% silver US coinage, how about a silver quarter that is worth $3.93ish as I type this?

[Love Life]

In hard times I'd trade you a tomatoe for an ounce of gold. Straight across of course...

[Cap'n Morgan]

But here's the thing... if you have something of value, you can sell for boat loads of worthless bills during hyper inflation, couldn't you take those bills in and pay off your mortgage? After all, they are face value dollars, and that's what your mortgage was written on right?

A number of large German industrial corporations did just that during the hyperinflation years following WWI. It left them with a clean slate to begin the build-up for WW2.

[quilbilly]

Blacksmith is right. Gold is a constant if you consider what it will buy. I always thought that an ounce of gold will buy a premium tailored wool suit. An ounce of silver is almost the same except that it is a more practical commodity (one ounce will buy you enough gasoline to get around, namely about 6-7 gallons of gas) that has not changed much since the late 1960's.

[PatMarlin]

A number of large German industrial corporations did just that during the hyperinflation years following WWI. It left them with a clean slate to begin the build-up for WW2.

Yep. I knew that had to happen and I've never heard anyone talk about it. Glenn Beck, non of those guys hyping gold.

I looked at my Mortgage note yesterday, It states:

"Principal and interest payable in lawful money of the United States".

Well it also states "Dollars". So until the evil corrupt money grabbin' sobs in Washington change that, I'm taking in my wheel barrow... :mrgreen:

[PatMarlin]

So for all those sky is falling predictions that the US dollar may be worthless, I say well yes for somethings. But extremely valuable for paying off my fixed mortgage, which is the most important thing for me in hard times, as I don't want to lose my home.

With my home I can eat.

[merlin101]

In hard times I'd trade you a tomatoe for an ounce of gold. Straight across of course...

I'll match your tomatoe and toss in three green beans!

[oneokie]

USCRA112,
In general; if a person could buy down or pay off a mortgage should they?
If it's locked/fixed into a low interest loan, or is it wiser to pay it off?

Depends on your individual situation. If you have the cash to pay off the mortgage and doing so would not leave you in a financial tight spot, you need to compare the interest you are paying on the mortgage and the return you are currently getting on your cash reserves.

Having said the above, unless we see a rise in inflation to where you would be paying with cheaper dollars until the dollar tanks, you are the only one who can make that choice. If the spread on the interest is close to 2 or 3% or more, I personally would pay off the mortage. I did so 3 years ago and haven't looked back.

[uscra112]

USCRA112,
In general; if a person could buy down or pay off a mortgage should they?
If it's locked/fixed into a low interest loan, or is it wiser to pay it off?

Unless you can get an investment that will pay about 2% higher interest rate than that of your mortgage, absolutely yes, pay it off. And the investment better be very secure and have a term as long as or longer than your mortgage. Textbook case: All too many farmers have been encouraged (often by government) to borrow lots of money to buy more land when commodity prices are good, thinking that the return on that investment will always be greater than the interest on the loans. For a few years, maybe, but commodity prices are volatile, so five years, or ten years hence they are suddenly in the hole and losing their farms. That's why smart farmers merely lease additional land. (My Dad leased land to a neighbor farmer, long ago. I guess I'm in the game too, in that I let my current neighbor use my pasture. He couldn't pay me much if anything at all, but it qualifies me for the agricultural tax rate, which is no small thing to me.)

There's also a discussion to be had over whether your dwelling is an investment or a consumption item, like a car. Honest financial people will tell you that it's the latter. It produces no income for you, and it gets used up over time. A house that you rent out is another story. It produces income.

[Catshooter]

Pat,

In your planning, don't forget your property taxes.


Cat

[MaryB]

If they do devalue the dollar and $100 is suddenly $1 it is a good thing to have coins on hand, they will not change value.

[dagger dog]

IMO
The USA dollar is worth more as paper than the face value.The vaults at Ft. Knox's are empty, and the printing presses are running as you sleep.

Has anyone that's read this thread been to the grocery lately ?
Check your 401K if you still work !

The OP's point is the future, better have a plot of soil to work, and fresh water to drink.
my2c

[Blacksmith]

Most people are already paying off fixed rate mortgages with inflated dollars.

Look at the amount of your mortgage and the date you started paying it.
Then look at what you are paying today, the increase is probably taxes and insurance.

Now divide your actual fixed rate mortgage, less the taxes and insurance, by the per ounce price of gold in the year you started and do the same for the price of gold today. In terms of gold you are paying less today (inflated dollars) than when you started.

Here are Historic Gold Prices
http://www.nma.org/pdf/gold/his_gold_prices.pdf

Todays Gold Price
http://www.kitco.com/market/

Example:
If your 30 year fixed rate mortgage payment is $!,000 per month P&I and you have been paying for 20 years.
In 1993 $1,000 was equal to 2.78 oz of gold at $359.77 per oz.
Today in 2013 the same $1,000 payment is equal to 0.79 oz of gold at $1,265.50 London PM fix on 10/11/2013.

In other words the 2.78 oz of gold when you started would pay a $3518 mortgage today. Hopefully your house would bring 3 1/2 times as much today as it cost 20 years ago (adjusted for interest rates).

[shdwlkr]

One thing I have failed to see is what if the bank decides they want your note paid in full right now and most loans are in this situation. Think of the feds wanting to close the bank and yes we have seen this in recent past. Is your mortgage safe in a bank failure? What if your home is worth more than what is owed against it, who gets to profit from the increased value? Now if you have a large loan against your home then it is better to have you pay the bank or whoever as over the long run they get more dollars, not more value just more dollars.

If you look I think the last time I found it our dollar is worth something like $0.05 in real value or less so if things keep going south here just what is the price of a gallon of anything going to cost in 3 months, 6 months, a year or longer out in the future.

Right now we have more dollars floating around the world then we have anything to back them with real value. I know we don't have silver or gold backing the dollar more like only the good name of United States which I don't think is worth all that much anymore.

Just wondering if you paid off your mortgage and have only property taxes to pay and our money is worthless do you think you can pay your taxes with worthless money? Seems to me that those wanting payment would want something they could use to buy things with. So in hyperinflation say this morning at 8am your money will buy you a loaf of bread for say $1,000,000 but by 8:10 am you need another $1,000,000 to buy that same loaf of bread won't taxes fallow the same rate of rise? Just asking a question here

[garym1a2]

NOPE, the dollar is worth what people will pay for it, the Chinease think its worth about 6.2 RMB, The Gold people think its worth about 1/2000 of an ounce. The oil people think you need about 110 of them for a barrel.
If no-one wants it than it's worth nothing.


IMO
The USA dollar is worth more as paper than the face value.The vaults at Ft. Knox's are empty, and the printing presses are running as you sleep.

Has anyone that's read this thread been to the grocery lately ?
Check your 401K if you still work !

The OP's point is the future, better have a plot of soil to work, and fresh water to drink.
my2c

[starmac]

If you can't find anybody that wants them dollars,send them my way. I will find a use for them.

[dagger dog]

If you can't find anybody that wants them dollars,send them my way. I will find a use for them.:grin:

[shooter93]

I was just going to post that starmac...lol.

[MaryB]

Only thing backing the US dollar is the US military...

[TXGunNut]

Hyper-inflation is an economic collapse, paying off your mortgage will be the least of your worries. Hyperinflation is a fantasy sold by precious metals brokers. A couple of years ago I told my investment broker the gold bubble would burst someday, he said it couldn't happen. I asked him how many folks said that about real estate several years ago.

[762 shooter]

I find it difficult to place much confidence in dollars or gold. The government determines it's worth and has in the past made it illegal to own in quantity (gold). Gold is only an investment for coming out of the other side of an event. It is worth too much to be useful day to day.

762

[PatMarlin]

If they do devalue the dollar and $100 is suddenly $1 it is a good thing to have coins on hand, they will not change value.

Expand more on that thought Mary. Interesting,.

Lordy, This can be such a complicated subject. I try to think in bone head terms... :mrgreen:

I know one thing, I bought $10,000 in gold at $265 an ounce back in 1999 and sold it to soon, about 2004. It was for realestate and, well now I look back on it I did OK anyway, but holy cow if it hadn't been for dirt I would have lost BIG time. Just dumb luck.

[shdwlkr]

keep in mind that most US coins are junk metal coins which means there is no real metal value in them.
So in effect the government can say all coins in current circulation is worth nothing and must be turned for new even less valuable coins at an exchange rate of their choosing.

Have you noticed how things are slowing going up in cost and sizes are getting smaller on packages?

[starmac]

Did you say slowly, hmmm

[Catshooter]

Pat,

Historically, when governments have devalued their currency it's often done in steps. Like Monday they announce that they've dropped two zeros off the dollar. So your $100 bill is now worth $1. When they do that it is usual that they leave the coins alone. The penny doesn't work when it's worth .001 and so on, and minting new coins is an expensive and time consuming business. So they just devalue the paper money and leave the coins alone.

Most people don't have much in the way of wealth in coin. But if you had say $10,000 in coins when they did devalue the dollar your coin worth just went up by two zeros at the same time your paper money went down two. Make sense? Actually it doesn't but we can pretend it does. Just like we pretend to live in a free country. Works as long as it works.


Cat

[cpileri]

Sir!
given the current state of events, what would you invest in, or advise to protect wealth in the near future?
C-



Sorry Popper, but inflation and deflation are most emphatically NOT the same thing. In fact they are polar opposites. Inflation is an increase in the supply of money over and above the growth of productivity in the economy. You have that right. This comes about by debasement of the currency, as in Roman times when they alloyed lead and tin into the silver and gold coinage, or comes about by increases in the amount of debt, as happens in modern economies that depend on foat money. Debt is money, to an economist. The borrower has the money, and the lender thinks that he too has the money, because he thinks he can demand it back from you at any time. So the both go their merry way, until suddenly the lender realizes, "Oh, $@&x!, that loan ain't ever gonna be paid back!" The value the lender thought he had, i.e. the "money" created by his half of that loan, simply vanishes. THAT is deflation - a shrinkage of the money supply, usually due to debt bubbles bursting. In that scenario, prices for material goods fall because nobody has the money to buy them. After the Revolutionary war is an excellent case in point. The economy had been blown up by the issuance of paper money, which suddenly became worthless as colony after colony repudiated it, when they found that they could not tax the farmers enough to pay it off. The amount of gold and silver in circulation was small. Farmers could not get their hands on any, so many of them were forced into bankruptcy, and when the sheriffs went to auction off their goods, the prices were pitiful, because nobody had any gold or silver to buy with. And THAT, by the way, was the primary reason that we got a Constitutional Convention, and our beloved Consitution.

Sorry for the long response, but before I became an enjineer, I was an economist :oops:

[zardoz45]

Gold is good for storing money but I doubt it would be useful as currency. I can't go to the grocery store and pay with a piece of gold, the gas station either, or any of the businesses around here. People are unfamiliar with gold unless it is in coins. Why would this be any different during and economic upheaval?

[Taylor3006]

Gold is good for storing money but I doubt it would be useful as currency. I can't go to the grocery store and pay with a piece of gold, the gas station either, or any of the businesses around here. People are unfamiliar with gold unless it is in coins. Why would this be any different during and economic upheaval?

That is only partially correct. There are many businesses and individuals that will take gold and silver as payment, nothing like Walmart, but lots of people do understand the value of precious metals. Sure there are tons of people who will not accept them for payment, but generally they work for someone else or produce nothing of value that I would give them gold or silver in exchange for. I am unsure why you would think in a hyperinflation scenario that even yer average person would not understand the value of gold, it would probably be common knowledge that your jewelry could buy goods. The Germans figured it out as did the Zimbawians as barter markets sprang up quickly to keep commerce going during their troubles. In times of plenty, stupidity can go unchecked or ignored. In times of crisis, it's deadly. You learn, you adapt, or you die.

If you talk with locally owned businesses and thier owners, I bet you would find some that would barter gold for thier products or services.

[starmac]

It is fairly common here for businesses, or even private individuals to sell stuff for gold. Even the banks take it.

[PB234]

Hyperinflation comes when people lose faith in the value of their currency. Rather than hold on to their currency they go out and buy real goods before the currency becomes even less valuable measured by the amount of real goods it can buy. As soon as this happens in force the demand for real goods exceeds the supply and the price goes up quickly.

The reason the paper in our pockets is valuable is our faith that it is worth something and that something is fairly stable.

Look for information about Germany between the wars. Some folks did very well and most did terribly.

Mostly all of us posting here will do poorly if the economy has a failure. Owning some gold, have debt, or even producing most of one's needs for food and shelter will not help much. We all have a stake in the future. Hyperinflation will corrupt that future as will many other things. In an unstable economy business can't predict the future stops investing which destroys growth meaning we are all going to be hungry one way or another.

[uscra112]

@ cpileri - - - First off I was an economist, not a financier.

The serious answer is "I dunno". But it's helpful to understand the difference between investment and speculation. Investment is the placement of money into some enterprise that you expect to turn a profit and thus pay regular dividends at decent rate. A decent rate is (or was) thought to be 5% of your investment per year. Building a mine, or a factory, or a retail store business is investment. Putting money into something because you expect (or fear) that the market price will change to your advantage is speculation. In modern capital markets, the speculators always dominate the pricing, because they aggressively manipulate the news to try to stampede the market in their preferred direction. But they are usually concentration on "glamour" stocks. (BTW look up the original meaning of the word glamour!)

INVESTORS, like my financial son-in-law, look for less conspicuous stocks that are not overpriced due to speculation, and which reliably pay dividends. Because of the draconian "insider trading" laws, and the policies of the company he is associated with, he rarely ever tells me what he's put his clients' money into. He could if I had enough money to open an account with his business, but unfortunately a million bucks is kinda outside my price range!

As for us "little folks", he says #1 get out of debt, #2 get out of debt, #3 get out of debt. Short of an apocalypse so dramatic that collection of paper debts becomes irrelevant, debt is a Sword of Damocles. A banker can take over your home for $100 as easily as he can for a million, and they will if they see the least financial advantage to it.

I can also tell you that , when I asked him if I should buy gold, he said that he himself does not hold any precious metals whatsoever, nor does he put any of his clients' money in gold or silver. More than that he would not say. Occasionally he gives me a glimpse of what stocks he holds. A supplier of pipeline components for the natural gas infrastructure. A medical supplier that just happens to be the company that supplies my insulin. I will also tell you that he's hell-bent on buying land in a spot that is about as remote from NYC as you can get without leaving the continental US. Daughter sees it as a vacation spot. I think he's looking to have a Bug Out Location.

When I retired, I took that advice and used my saving to pay off 100% of my debt, and paid cash for the little farm-remnant I now live on. I may be poor on the surface, but my monthly bills are low, and no-one can foreclose on me.

If you are young, your best investment is in yourself. Develop your skills and knowledge so that you can be worth a decent living doing something worthwhile to other people. (This does NOT mean becoming a welfare worker.) Maximize your options. There's an old joke about engineers being people who learn more and more about less and less, until they wind up knowing absolutely everything about nothing. I managed to avoid that trap, and although I never made the big bucks, I was never unemployed for long either.
--------------
I just don't see how a hyperinflation can get started here. PB234 brings up a good point about hyperinflation - what economists call the "velocity" of money. A measure of how many times per day that a dollar changes hands. High velocity has the same effect as a sudden increase in the money supply. Panic over price increases is a divergently unstable condition, and the Weimar Republic not only did nothing to stop it, they had no TOOL to stop it. Today the big banks who run the country can choke it off in an instant by shutting down the credit card clearing system. And they will, because they get badly hurt themselves by a hyperinflation.

[shooter93]

I think you prepare in as many ways as possible. Some simply can't buy much gold etc. And just because gold,silver,diamonds etc have a historical stability doesn't mean they will. It all hinges on what people want at the time. Using food as an example.....if the collapse is deep enough no one has enough gold to buy what I have. While I don't think a collapse is a sure thing I do believe there could be economic factors coming that won't be pleasant. If it's a "total" collapse of our economy then it's impossible to know what will be the best protection. Keep in mind a total collapse of our economy means the entire world goes down too.....something that has never happened to the extent doomsdayers are "predicting" for this one so it's impossible to tell what will have value except for food and water. I often think many of the "experts" recommending buying gold and silver already have a ton of it and like to see the price skyrocket. If it happens it happens and I'll do my best to make it through...I either will or I won't. For me...if work was like it was before this administration took over I'd be building a stocked pantry like you've never seen and tell no one about it.

[MaryB]

There is no way in h**l you could get me to buy paper assets right now. The only thing propping up Wall Street is the $85 billion a month the fed reserve is creating out of thin air. Money supply has expanded at such a pace that the graph is almost vertical. Sooner or later they will have to taper off asset and bond purchases from the Wall Street banks and from the government. When this happens the crash is going to be bad. It will make the Great Depression look mild. Hard assets like gold that people buried were what saved many coming out of the depression. It may not be of any use during but as things settle down and trade resumes gold and silver will become money again.

[uscra112]

I can't but agree with you, MaryB. Very low interest rates drive stock markets up. Pension fund managers are desperate for a 3% or even 2% return, when their money gets nearly zero in money market funds or bonds. It's actually more complex than that, but that's the basic principle. So they'll bid stocks up to silly price/earnings ratios, and as soon as any higher interest rates come along, they'll abandon those stocks in a flash.

It's Hobson's choice at this point. The deficit is something like 6% of GDP, so if the deficit gets cut, there will be a massive recession. But if they don't cut the deficit, sooner or later confidence in Treasury bonds will fall, and the Treasury will have to pay much higher interest rates, which will further increase the deficit in a feedback loop that could crash the dollar. But there will be portents. Before that happens, they will find ways of confiscating IRA and 401k accounts, then private pension funds, and eventually even your plain old savings accounts. This happened ten years ago in Argentina. It just happened in Cyprus and Greece. Poland is the latest country to do it. They're just like crack addicts - will do anything to keep their habit going, including stealing from their own families. They've already replaced the SS trust fund with paper, so you can say that the Treasury has already confiscated that to pay their bills. Me, I cashed out my 401k when I retired. Paid the tax, and put the proceeds into the purchase of my "farm", so as to have zero debt. I may have been a little premature, but I fear that before the 2016 elections I will be proven right. (There's an old saying, attributed to one of the Rothschilds: Asked why it was that they always made money on market cycles, he said "we always sell too soon!")

In the 1930s, something like 70% of people still lived on family farms, and could manage to grow some food and get by, unless they had debts to pay, or lived in the Dust Bowl, or had serious medical problems that left the farm without adequate labor. Today it's well under 10%. Think that through......

[oldred]

I have a cousin who is a "Dinar idgit", he has spent over $12,000 dollars (that he certainly can't afford!) on IRAQI currency based on a BS internet scam, he claims when hyperinflation occurs here he is going to be rich because this worthless paper he holds is going to somehow "revalue" and make him a millionaire. The sad part is this thing is turning into one of the most wide-spread scams in history with well over a million people falling for it just here in the US alone!

[oldred]

That has got to be about the dumbest scam ever, have you seen any of those "guru" claims? What amazes me about the whole thing is how widespread it has gotten but it's based on claims that anyone with enough intelligence to tie their own shoes should be able to see through! This guy has tried several times to sell me on this non-sense but he I guess he finally got tired of me laughing at him, most of these people are truly convinced however and it would be comical if so many people had not been hurt by it already.

[PatMarlin]

Pat,

Historically, when governments have devalued their currency it's often done in steps. Like Monday they announce that they've dropped two zeros off the dollar. So your $100 bill is now worth $1. When they do that it is usual that they leave the coins alone. The penny doesn't work when it's worth .001 and so on, and minting new coins is an expensive and time consuming business. So they just devalue the paper money and leave the coins alone.

Most people don't have much in the way of wealth in coin. But if you had say $10,000 in coins when they did devalue the dollar your coin worth just went up by two zeros at the same time your paper money went down two. Make sense? Actually it doesn't but we can pretend it does. Just like we pretend to live in a free country. Works as long as it works.


Cat

Yes- it is still confusing. I think where ever you are, when things change you adapt and make do. Your neighborhood needs a trade currency of some kind. The 49ner's here used gold dust. Prisoners use cigarettes. Kids used to use marbles.

So- what do we have on hand (if we are fortunate enough)? Cash and coins. As long as everyone has the same kind, then your local community will determine the trade value of that currency. I think when you have to trade your currency beyond your neighborhood, then it gets complicated. Hopefully, you live in an area where people can grow food and hunt, etc. If your stuck in the barrio ala Poland or East Germany, New York, LA, Detroit, San Francisco, then you are at the mercy of whoever is in charge. Some folks are (stuck) in this country, but a large majority is not of course.

Interesting article came out yesterday on the subject:

U.S. May Join Germany of 1933 in Pantheon of Defaults
http://www.bloomberg.com/news/2013-10-13/u-s-risks-joining-1933-germany-in-pantheon-of-deadbeat-defaults.html

Could Obama be following De Führers lead? ...:shock:

I think the well- solar powered is mandatory, and one I'm implementing here. I already know what can be done and ran off grid inexpensively and I'm doing just that. I'm going out with a young lady who's been a nurse for 23 years and certified to work in any section of her hospital including surgery. That may be a good move as well... :mrgreen:

[oldred]

Pat,

Historically, when governments have devalued their currency it's often done in steps. Like Monday they announce that they've dropped two zeros off the dollar. So your $100 bill is now worth $1. When they do that it is usual that they leave the coins alone. The penny doesn't work when it's worth .001 and so on, and minting new coins is an expensive and time consuming business. So they just devalue the paper money and leave the coins alone.

Most people don't have much in the way of wealth in coin. But if you had say $10,000 in coins when they did devalue the dollar your coin worth just went up by two zeros at the same time your paper money went down two. Make sense? Actually it doesn't but we can pretend it does. Just like we pretend to live in a free country. Works as long as it works.


Cat


No quite!

Re-denominations are fairly common and it's no big mystery how they are done, Russia, Mexico and Turkey are recent examples but ALL the currency is/was affected equally including coins, it can't possibly work any other way! It's an across the board thing, they drop zeros off the currency (usually three but I think Turkey's currency was so inflated they had to drop six) then the old currency is exchanged for the new at whatever ratio it was changed. For example when three zeroes are dropped the new currency is now worth 1000 times more than it was the day before BUT the old must be exchanged for the new at a ratio of 1000 old for one new. It's a neutral event that is done solely to erase the effects of past inflation and no one loses or gains anything in the process except that now business is conducted with fewer but more valuable bills/coins, ALL currency must be affected equally, thus hoarding coins as a hedge against inflation is useless! A quick Google search on currency re-denomination will explain this clearly, the reasons why it's done, how it's done and why ALL currency must be affected equally, it's the only way it can possibly work.

[PatMarlin]

You guys go to fast for me. I can't figure out where to run... :mrgreen:

Say you had a $1000 to use as cash on hand as doomsday currency trade. What would you do with it?

A. Buy gold and what denomination?

B. Buy Sliver and what denomination?

C. Buy 60% silver coins

D. Trade it in for $500 in cash (ones and twenties) and $500 in coins up to 1/2 dollars?

E. Buy Iraqi bills

F. Buy US savings bonds... :mrgreen:

G. Any combination above?

[oldred]

You guys go to fast for me. I can't figure out where to run... :mrgreen:

Say you had a $1000 to use as cash on hand as doomsday currency trade. What would you do with it?

A. Buy gold and what denomination?

B. Buy Sliver and what denomination?

C. Buy 60% silver coins

D. Trade it in for $500 in cash (ones and twenties) and $500 in coins up to 1/2 dollars?

E. Buy Iraqi bills

F. Buy US savings bonds... :mrgreen:

G. Any combination above?

Buying gold or silver may or may not be a good investment but historically it usually is however changing for and holding smaller denomination bills and coins will do nothing for you except result in a bigger stack of currency worth the same as a fewer number of the larger notes. There is no instance in history where a country re-denominated (revalued/devalued) it's currency and only changed certain denominations and left others alone (such as changing the bills and not the coins as has been suggested) and I challenge anyone to show me an example of a country that has! An often used argument to this effect is when the US removed from circulation the bills larger than a hundred but that's not a re-denomination, a revaluation nor a devaluation that was simply retiring larger notes and it had no effect at all on the value of either the bills removed (they're still legal tender if you have one) nor the bills/coins remaining.


Buying Iraqi currency is about as good a hedge as flushing your money down a toilet!

[Outpost75]

Hyperinflation is not an economic outcome. It isn't something that emerges, mechanically, from some macroeconomic process gone wrong. It is a symptom of total social and political collapse. And while it would be unwise to say that it could never happen in America, it is simply mistaken to say that it could happen because Congress was too foolish to balance its budget.

To put things a different way: Paul Ryan is wrong that bad budgeting will lead to hyperinflation. It won't. Bad budgeting will eventually lead to circumstances, most likely being higher interest rates, that convince legislators to end bad budgeting (or to budget badly in a different way). The fact that Ryan is left warning about hyperinflation rather than leading the charge for the new, better bad budget simply suggests that his approach is less consistent with the norms American civil society holds dear than available alternatives.

http://www.economist.com/blogs/freeexchange/2013/03/hyperinflation

http://www.forbes.com/sites/kotlikoff/2013/09/28/is-hyperinflation-just-around-the-corner/

http://www.theatlantic.com/business/archive/2012/03/the-hyperinflation-hype-why-the-us-can-never-be-weimar/254715/

[Blacksmith]

You guys go to fast for me. I can't figure out where to run... :mrgreen:

Say you had a $1000 to use as cash on hand as doomsday currency trade. What would you do with it?

A. Buy gold and what denomination?

B. Buy Sliver and what denomination?

C. Buy 60% silver coins

D. Trade it in for $500 in cash (ones and twenties) and $500 in coins up to 1/2 dollars?

E. Buy Iraqi bills

F. Buy US savings bonds... :mrgreen:

G. Any combination above?

Pat

Assuming you have all your other bases covered i.e. food, necessities, equipment, etc. and this is just for "....to use as cash on hand as doomsday currency trade." I would recommend putting a couple of hundred in US Folding money (no big bills) to use at the start or if it is just a minor glitch because people will take cash even if the computers are down and the credit cards wont work. Beyond that the most liquid thing will probably be so called "Junk Silver". The are US coins made with a silver content, dimes, quarters, halves and dollar coins minted before 1965 which are made with 90% silver (not 60%) the one classed as "Junk" are circulated, worn enough they have no special coin collector value. These are widely recognized and have an accepted silver content. Coins or bullion from other countries or from private mints will always have a question of what the purity is no matter what is printed on them. Junk silver is about the least expensive silver you can buy and you can even get it without buying. There are people doing business right now who will give you a discount if you pay with silver coins. You could offer a similar thing with what you sell and some may take you up on it thus you would get useable silver in trade for your goods. If you are going to deal in silver you need to do some studying and educate yourself.

Here is a site to look up the US coins and what their value in silver is:
http://www.coinflation.com/

This site explains "Junk Silver":
http://www.silvermonthly.com/junk-silver/

And the best places to buy it:
http://www.silvermonthly.com/junk-silver-ratings/

This is a site to read about the real modern times of what happens when money is worthless. This happened in Bosnia but you can find similar tales from Argentina and elsewhere.
http://sovietoutpost.revdisk.org/?p=72

[carolina556]

Food, Bullets, Lead, Powder, Land, and Water in that order :) The only precious metal I would buy would be the one that I can cram down the barrel if I need to. Each is a good investment as the cost of most all of them continue to go up, faster than a piece of gold or a stock or bond. Plus they provide survival which to me is better than paper money or precious metal.

[shooter93]

Doomsday currency for me Pat ....which I can buy none of now....lmao.....would probably be US silver coins or possibly US gold coins in very small denominations if it's gold. If for no other reason than having a gold coin valued at 1000 bucks it would be hard getting change from a store but with silver you'd be dealing with smaller numbers.

[LeftyDon]

My point is, say you sold some much needed items like reloads or something, for wheelbarrow loads of cash, then went down and paid your mortgage off in cash. Face value. Why wouldn't that work? Could it actually be good to be upside down or heavy on a mortgage, during a time like that? Yes, you could, but you might need the wheelbarrow of money to buy your next loaf of bread too. In Germany it got so bad that they were printing money only on one side so they could keep up the quantity of output needed to keep up with the inflation rate. Best to be buying lead to keep the zombies away if that ever happens here.

[LeftyDon]

No quite!

Re-denominations are fairly common and it's no big mystery how they are done, Russia, Mexico and Turkey are recent examples but ALL the currency is/was affected equally including coins, it can't possibly work any other way! It's an across the board thing, they drop zeros off the currency (usually three but I think Turkey's currency was so inflated they had to drop six) then the old currency is exchanged for the new at whatever ratio it was changed. For example when three zeroes are dropped the new currency is now worth 1000 times more than it was the day before BUT the old must be exchanged for the new at a ratio of 1000 old for one new. It's a neutral event that is done solely to erase the effects of past inflation and no one loses or gains anything in the process except that now business is conducted with fewer but more valuable bills/coins, ALL currency must be affected equally, thus hoarding coins as a hedge against inflation is useless! A quick Google search on currency re-denomination will explain this clearly, the reasons why it's done, how it's done and why ALL currency must be affected equally, it's the only way it can possibly work.

Not so. If you hoarded silver coins in the '60's they would be worth about 20- 25 times their face value today. Ditto with real copper pennies, today's one cent coin is copper plated zinc due the value of copper being more than one cent. Metals will increase in value during hyper-inflation, but paper money only use will be as backup when you run out of old Sears catalogs to wipe one's behind. Roosevelt took us off the gold standard, Nixon off the silver standard, today's paper money is only backed by one's belief that it has more value than as a piece of printed paper.

[LeftyDon]

Food, Bullets, Lead, Powder, Land, and Water in that order :) The only precious metal I would buy would be the one that I can cram down the barrel if I need to. Each is a good investment as the cost of most all of them continue to go up, faster than a piece of gold or a stock or bond. Plus they provide survival which to me is better than paper money or precious metal. You are 100% correct except you need to watch out for the gov't taking everything in an emergency.

[LeftyDon]

There were 40% silver coins, all except 1964 Kennedy 1/2 dollars (that one is 90%) are 40% silver clad plus a few proof coins that were sold in proof coin sets and not for circulation were also 40%. But no 60% US coins. Junk silver coins (pre-1964) are good to have, Mercury or Roosevelt $0.10 coins are the least likely to have holes drilled into them and plugged by people willing to mess with anything to make a buck and to screw anyone taking silver coins as being real. Any hyper-inflation could bring back pieces of eight - cutting larger coins into smaller pieces due to large value of the full coin. Hence the term, "Shave and a haircut - two bits", or two 1/8 pieces cut from a Spanish dollar.

[LeftyDon]

Us old timers remember going into a bank and giving one George Washington to a teller and getting one Morgan or Peace silver dollar in return. Try that today! Gas isn't expensive, the US dollar has become 1/25 of the value it had in the '60's. I just wish I had ever one that passed though my hands!

[Dave C.]

I've got all my money invested in barges filled with bananas!

Dave C.

[Dale in Louisiana]

To be able to compare to nowadays here:
Where and when was the last hyper-inflation?
Post WWI Germany. (Note:the whole world was punishing them for WWI, unlike post WWII Germany)

I was Nogales Mexico one day and saw a boy carrying over his shoulder a pillow case packed full of Mexican coins. Recently the Mexican government had re-valued their peso. It was about 1200-1500 pesos to the dollar, cannot recall exactly now. It had been 2000 pesos to the dollar. So all he had was equal to about $100 US dollars. That was around 1990 year.

I have a 100-TRILLION Zimbabwe dollar note. Cost me three bucks. Let's see some parallels: Large population of 'entitled'? Check. Government increasingly interfering in productive enterprise? Check! Monetary policies protected for the politically well-connected? Check! Government borrowing way more than it takes in so it can make the 'entitled' stay happy enough to vote the 'right' way to maintain the illusion of a functioning democracy? Check!

Oh yeah. We're in trouble.

dale in Louisiana

[uscra112]

In a truly apocalyptic situation, liquor and cigarettes become prime barter items. I'd have $250 in "nips" and another $250 in cigarettes. The gummint would choke off cash transactions with banks, which means that no retail store could accept cash, either. This was done in Cyprus within the last year. The polite term is "capital controls". ( But I betcha the EBT cards would still function. ) In which case paying off your mortgage withe cash would be impossible. In fact it already is - any such "deposit" gets reported to the Feds, and your get a visit from the IRS.

There's several "prepper" sites that list things that will become scarce in a hurry. Here's one based on real-life experience: http://readynutrition.com/resources/emergency-items-what-will-disappear-first_11112009/

[Dale in Louisiana]

"Ammo will get you through times of no money better than money will get you through times of no ammo."

dale in Louisiana

[Love Life]

I have a cousin who is a "Dinar idgit", he has spent over $12,000 dollars (that he certainly can't afford!) on IRAQI currency based on a BS internet scam, he claims when hyperinflation occurs here he is going to be rich because this worthless paper he holds is going to somehow "revalue" and make him a millionaire. The sad part is this thing is turning into one of the most wide-spread scams in history with well over a million people falling for it just here in the US alone!

I have a couple fat stacks of Saddam money and after Saddam Dinar. They were pretty cheap...

[oldred]

Not so. If you hoarded silver coins in the '60's they would be worth about 20- 25 times their face value today. Ditto with real copper pennies, today's one cent coin is copper plated zinc due the value of copper being more than one cent. Metals will increase in value during hyper-inflation, but paper money only use will be as backup when you run out of old Sears catalogs to wipe one's behind. Roosevelt took us off the gold standard, Nixon off the silver standard, today's paper money is only backed by one's belief that it has more value than as a piece of printed paper.



Yes it is so, you are comparing apples to oranges there. The silver and gold coins are valuable due to their precious metal content and that has nothing to do with hoarding coins as was suggested that dollars could be devalued but coins would not, any devaluation would be across the board and BTW the FACE VALUE of those coins were just as affected by inflation as the rest of the money! Coins normally in circulation today would hold no more value than paper money and THAT is what we were discussing, not coins for their metal value!

[oldred]

I have a couple fat stacks of Saddam money and after Saddam Dinar. They were pretty cheap...


This Dinar scam has swept the country and is a multimillion dollar business, it's shaping up to be one of the biggest swindles in history because there is little the law can do to stop it. Because of the internet misinformation and hype are spread by forums that have sprung up dedicated to this nonsense and since they don't sell Dinar they can say about anything they like and they hype this worthless paper to no end! OTOH the actual sellers of the currency don't hype it and make no claims at all other than to say "some investors believe it will grow in value" or something similar but they do not directly participate in the hype -they don't need to! There's certainly money to be made from Dinar but from SELLING it not buying it! The sellers pay serious money to the hypsters to hype this stuff but make certain they can't be connected directly to them so it's all legal unless the law can catch one of them both hyping and selling but they're to smart for that. It's the perfect scam, the hypsters are safe from prosecution because they aren't actively selling anything and the sellers are safe because they make no false claims (they don't make ANY claims).


What I can't understand is how anybody could be dumb enough to spend over a thousand dollars for a million Dinar from someone who is telling them (indirectly trough a proxy/forum/guru/pumper/take your pick) that it will "soon" be worth 1 to 3 million dollars! Would anyone with at least half a brain sell 1 to 3 million dollars worth of anything for 800 to 1000 dollars? Of course there are many, many reasons why all this is absolutely economically (and even mathematically) impossible but greed blinds a lot of people I suppose. For it to happen the way these people want to think it will and revalue at "only" $1 to the Dinar would mean that Iraq would go from being a backward third world country to having a net worth of over 80 TRILLION DOLLARS overnight due to the fact it has 80 trillion Dinar! That, incidentally, is more money than exists in all the countries on planet Earth combined and some of these people believe it could be even three times more than that.

[Love Life]

Ummmm. My Dinar was VERY cheap. It also came from the source...:bigsmyl2: I always hung onto it as a souvenir.

Dang, I remember when 1,000,000 Dinar was like $8.00 and change. Or was that a 25,000 Dinar note? It's been awhile, but I do remember buying 12 glass bottled Arab Coke-A-Cola's for $1.00. They were ice cold and the sweetest thing I'd ever tasted.

Sorry for the thread drift.

[oldred]

The old Saddam Dinars are worthless and have souvenir value only and the new Dinar (IQD) is officially worth 1166 Dinar to the dollar but technically it too is worthless outside of Iraq, however if it's sold here to the Dinar "investors" it can be worth as much as $900 to $1000 per million sold on E-Bay or one of the forums. For a very short time, only for someone in Iraq at the time, it could be bought for about half that and a few people holding them at that time actually doubled their money and that is where the scam took root. Soldiers brought home Dinar they got for nearly nothing and the rumor started that it would continue to increase in value so the scam took off and the scam artists saw a fortune to be made from importing Dinar (mostly bought from banks in Jordan) to re-sell here at about a 40% mark up. The big lie being told about the Dinar kept getting bigger and bigger and the term "RV" was coined by the Dinar pumpers to refer to the "coming event" where the Dinar would certainly return to it's once high value of over $3 to the Dinar, it was supposed to increase to be worth 3000 times more than it's current worth overnight! Yeah SURE it will! But people fell for this BS by the millions unfortunately and there are an estimated 2 million+ "investors" in this scam just in the US alone!

The scam is starting to fall apart now (it's about time!) and I know one fellow who has bragged about finding a million Dinar for less than $700 on E-Bay, he doesn't realize that people are finally starting to wake up and dump that worthless paper. What these people don't realize is that when the Dinar was worth $3+ there were only about 15 billion Dinar in circulation with nearly 50 billion dollars worth of reserves at the Iraqi central bank backing them, basically Iraq had in reserve about times as much money backing what it had in circulation similar to what Kuwait has today. When Saddam got into that stupid war with Iran he blew his reserves paying for the war and Iraq underwent massive inflation with the Dinar dropping to as little as 4000 to the dollar and that's where it was after the fall of Saddam when Iraq issued the new Dinar under the watch of the US Government, now Iraq has over 75 billion dollars worth of reserves (nearly twice what it had under Saddam) BUT now due to past inflation it has OVER 80 TRILLION+ Dinar backed by the 75 BILLION +/- dollars in reserves and that's why it's worth so little and why it will NEVER increase by any significant amount no matter what the rumors are saying! Eventually Iraq will re-denominate it's currency (lop off zeros from the face value like other countries in similar situations have done) like they have been talking about doing for the last two years and then issue a new currency worth 1000 times more than the old but the old will not change in dollar value like the big lie claims it will, when the new 1000 times more valuable Dinar is issued the old will exchange (if you happen to be in Iraq that is!) 1000 old for one new. This means "investors" in this scam will very likely be left "holding the bag" since they will have little to no way of exchanging unless the so-called dealers are still around to buy it back at a fraction of what it sold for, however it's possible or even likely Iraq will close it's borders to outside speculators during this exchange (like they did in 2003 during that exchange!) and people here will be left with a bunch of colorful paper.

My wife and I did a lot of research on this nonsense when my cousin started to spend all his money on it and was constantly pestering us and other family members to "invest in this wonderful opportunity", I watched as this idiot blew the $18.000 his mother left him when she died in addition to what he had already spent but there is no reasoning with him. I hope and pray this scam comes to an end soon and I truly hope the perpetrators end up in jail but I have little hope of that happening due to the unique way this scam is being operated.

[LeftyDon]

Yes it is so, you are comparing apples to oranges there. The silver and gold coins are valuable due to their precious metal content and that has nothing to do with hoarding coins as was suggested that dollars could be devalued but coins would not, any devaluation would be across the board and BTW the FACE VALUE of those coins were just as affected by inflation as the rest of the money! Coins normally in circulation today would hold no more value than paper money and THAT is what we were discussing, not coins for their metal value!

Paper money is worth what people are willing to sell or swap for it. Metal is worth what metal is worth and also if in the shape of a coin then also worth face value in paper. As time goes by and we use quantitative easing to help the gov't pay it's debts then paper is worth less (worthless?) over time, but metal retains value. Coins are normally made from less metal than face value, but that changes with inflation. Hence the copper plated zinc pennies of today. "O" could tell you that a $1 trillion coin is worth one trillion George Washington's, but if the metal is worth $1.95 then it is a scam. On the other hand, why would you take a metal coin worth more for its metal content and use it as devalued currency? In times of inflation coins disappear. Copper pennies and silver coins disappeared due to value as metal. Silver is silver. If it is in the shape of a coin then many people are willing to believe it is easier to use in trade vs. bullion because of fake bullion. But in any case, I'd rather have any metal coin including pocket busting clad Ike dollars vs. a piece of paper with George's face on it when the SHTF. You can always melt metal down and sell or trade it for more than use as toilet paper.

[uscra112]

Nickels are still worth more than face value. Save yer nickels.

[oldred]

Paper money is worth what people are willing to sell or swap for it. Metal is worth what metal is worth and also if in the shape of a coin then also worth face value in paper. As time goes by and we use quantitative easing to help the gov't pay it's debts then paper is worth less (worthless?) over time, but metal retains value. Coins are normally made from less metal than face value, but that changes with inflation. Hence the copper plated zinc pennies of today. "O" could tell you that a $1 trillion coin is worth one trillion George Washington's, but if the metal is worth $1.95 then it is a scam. On the other hand, why would you take a metal coin worth more for its metal content and use it as devalued currency? In times of inflation coins disappear. Copper pennies and silver coins disappeared due to value as metal. Silver is silver. If it is in the shape of a coin then many people are willing to believe it is easier to use in trade vs. bullion because of fake bullion. But in any case, I'd rather have any metal coin including pocket busting clad Ike dollars vs. a piece of paper with George's face on it when the SHTF. You can always melt metal down and sell or trade it for more than use as toilet paper.


Metal coins made since the switch from precious metals are worth face value and no more than that and will retain no more value than paper money unless you think maybe metals like Zinc is going to be worth as much as Silver someday, not likely. Besides that's not what we were talking about anyway, the statement was made that hanging on to coins was a good idea because paper money could be devalued but the coins would not and that can not happen (with the exception of the precious metal coins which are already hoarded away! Currency is currency be it coin or paper and any devaluation will be across the board equally affecting the face value of ALL in circulation, coins made of valuable metals are worth more than face value today but do you find them in circulation? Occasionally one will turn up but it's very rare and if you think today's coins are a good way to hedge against inflation then store away a truck load of them but good luck with that!

[Love Life]

So does anybody want to buy some of Dinar? I have several million worth and I'll let it all go for $12,000!!!

[oldred]

So does anybody want to buy some of Dinar? I have several million worth and I'll let it all go for $12,000!!!


For your sake I hope you're joking.

[Love Life]

Oldred-I believe you missed my sly hints. I have a boatload of Dinar. I got it super cheap trading with the bootleg movie seller in Iraq. I paid PEANUTS. I think I paid less than $50 American for a boatload of Dinar. I gave a bunch to family as gifts and still ended up with a bunch. It's my "I was there" collection. I'd love to sell it for $14,000.00., and I'd even take only $11,000.00

[oldred]

That's the only way anyone besides dealers are going to make any money from that stuff, I suppose in your case where you got it for next to nothing you could make a profit on it if you don't hold on to until the scam crashes. Right now there are still suc...err "investors" out there that will pay $700 to $800 or maybe even more for it but two years ago it would easily sell for over a thousand. The day Iraq announces the new ISO code for their new currency the bottom will drop out because at that point the re-denomination, or LOP as the dinar idgits call it, will become undeniable even to them.

[Love Life]

Naw. I don't have any intentions of getting rid of it. It makes for a good conversation piece and I usually give it to people who want some. I just thought it was cool to get stacks on stacks of money, regardless of national origin.

[oldred]

Well if you have millions, and apparently you do, then you could sell it for thousands but if you prefer to give it away that's a more honest approach. It actually has an official value of over $850 IF you could find a bank that would take it but since the scam became popular banks won't touch this stuff anymore, they did sell/exchange it until a few years ago as part of their regular money service to foreign travelers. When people started buying in quantity as an investment they did not want to get caught up in the scam and so stopped dealing with it at all, there may still be a few places that will get it for someone but if so they are the very rare exception.

[Love Life]

To be honest, this is the first I have ever heard of the scam with Dinar. It reminds me of an experience.

Back in Ar Ramadi in 2006-2007, we took over an old market place to build up an OP. In one of the rooms the floor was covered about 2 inches thick in coins. You know what we did? We built a wood floor over it and used it as a hooch.

Funny things.

[LeftyDon]

Metal coins made since the switch from precious metals are worth face value and no more than that and will retain no more value than paper money unless you think maybe metals like Zinc is going to be worth as much as Silver someday, not likely. Besides that's not what we were talking about anyway, the statement was made that hanging on to coins was a good idea because paper money could be devalued but the coins would not and that can not happen (with the exception of the precious metal coins which are already hoarded away! Currency is currency be it coin or paper and any devaluation will be across the board equally affecting the face value of ALL in circulation, coins made of valuable metals are worth more than face value today but do you find them in circulation? Occasionally one will turn up but it's very rare and if you think today's coins are a good way to hedge against inflation then store away a truck load of them but good luck with that!

First off, I never in your wildest dreams did I say zinc and silver had the same value. Second,, copper pennies are now worth more than face value so that blows your statement that only precious metal coins are worth more than paper. While zinc may not be worth much, it has value above and beyond being coined into a round object with a face on one side. Today that's less than one cent, but for how long will that be true. Plus not all of our coins are zinc, in fact most are made up of a 60% copper 40% nickel alloy. The clad coins are punched out of the nickel clad copper and the scrap is then melted and used as 5 cent (nickel) coins. The penny is the only coin today that is copper plated zinc. My statement that today's cent coins are now copper plated zinc was made to show an example of non-silver coins becoming worth more than face value. They replaced copper one cent coins that were worth more than one cent when melted. Get the idea? But soon maybe all of our coins will be zinc, or even plastic, going along with the dollar's drop in value. While the days of silver or gold coins are past, yesterday's precious metal coins are not be the only metal coins that will be worth more than face value over time when there's inflation. The question is how soon will they be worth more melted than as circulated as coins, not if it will happen. Copper, nickel, God forbid zinc coins, will be worth something as long as there is a use for the metals. Paper money, backed by nothing, is worth scrap linen paper value. That is much less than most metals. If you wish to think that the paper money will be the same as a piece of metal when hyper-inflation happens, then so be it. But I'll be willing to purchase all of your devalued coins from you at face value when the metal they are made from is worth more than face value. I'll make that offer today for for any silver US coins that you may own - one paper federal reserve George Washington dollar for any one pre-1935 silver US dollar. Any 4 pre-1964 $0.25 Washington quarters for one of my brand new $1 paper dollar. Heck, I might even have some old Silver Reserve paper dollars if new paper doesn't interest you, they're not worth squat either since the gov't no longer honors the backed by silver commitment. After all, per you, paper and coins all get devalued the same, right? Or maybe you still think it is only silver coins that has value? Think copper isn't going up in value or lead used for boolits or any metal including zinc over time. I'd also make an offer for copper pennies, but shipping costs are going up too. Oh wait, that's really the dollar is going down in value isn't it?

[oldred]

Again you are completely missing the point, my original post about the coins was about the suggestion that paper money would be devalued but that coins would be left alone, this was about FACE VALUE but you keep referring to the value of the metal content. Obviously if the metal is worth more than face value having a hoard of coins would be a good idea and I never said that it wouldn't in that sense but if a Government devalues paper money then coins are affected equally. THAT is what I was addressing!




With the metal content of today's coins you would need an awful lot of them to amount to much for scrap value if the face value tanks but you do have a point in that scrap metal will always be worth a heck of a lot more than scrap paper!


BTW, you took my example of zinc the wrong way, that was just an example I was making and I had not even noticed if you had mentioned zinc before I posted that.

[Blacksmith]

Here is a site that gives the actual value of the metal in United States Coins. It lists old coins and new coins and updates the values based on the current Metals market price.

http://www.coinflation.com/unitedstates/

Examples
The values below only reflect the metal value on the spot market, not rarity or numismatic value. All values shown in USD.

1909-1982 Lincoln Copper Cent (95% copper) * Denomination $0.01
Metal Value $0.0216332

1982-2013 Lincoln Zinc Cent (97.5% zinc) * Denomination $0.01
Metal Value $0.0050815


1946 - 2013 Jefferson Nickel Value Denomination $0.05
Metal Value $0.0447161

1942 - 1945 "Silver" Jefferson Nickel Value Denomination $0.05
Metal Value $1.2428

[LeftyDon]

Again you are completely missing the point, my original post about the coins was about the suggestion that paper money would be devalued but that coins would be left alone, this was about FACE VALUE but you keep referring to the value of the metal content. Obviously if the metal is worth more than face value having a hoard of coins would be a good idea and I never said that it wouldn't in that sense but if a Government devalues paper money then coins are affected equally. THAT is what I was addressing!




With the metal content of today's coins you would need an awful lot of them to amount to much for scrap value if the face value tanks but you do have a point in that scrap metal will always be worth a heck of a lot more than scrap paper!


BTW, you took my example of zinc the wrong way, that was just an example I was making and I had not even noticed if you had mentioned zinc before I posted that.


True coins would be devalued too. But unless you are as silly as some of my now departed aunts that took their silver mercury dimes to the bank and turned them in vs. allowing me to purchased them at more than face value then coins would be better to hold than paper. Remember Roosevelt forces US citizens to turn in all of their gold coins as part of the way to fund his New Deal. Such a deal that was. But in true times of hyper-inflation, you can't eat gold or silver. Nor can you defend you property with coins. Barter goods (booze, coffee and beans?) and a source of food/water will become the #1 need. My own thinking is ammo, a long term source of food and good friends that can watch your back and form into a self-defense group would be the best. I'm getting to be an old phart and just really hope I am gone before the next dark ages hits.

[MaryB]

I have a 1,000 Rupiah bill I will sell for say $100... Indonesia. Not sure of current value but it adds color to the front for the fridge :lol: probably worth 2-3 cents in real life.

[RugerFan]

When I retired, I took that advice and used my saving to pay off 100% of my debt, and paid cash for the little farm-remnant I now live on. I may be poor on the surface, but my monthly bills are low, and no-one can foreclose on me.


Outstanding advice!

[Lead Fred]

Hyper inflation is coming, and its going to be the end of what the USA has been.

Along with it, will be 20 years of civil war

You still like that hope & change thingy?

[fivegunner]

After reading all the post here, I am very inpressed with Mr; uscra112 He knows what he`s talking about. Thank you.

[Prospector Howard]

The most important thing that most people forget about is the unfunded liabilites. The amount of money promised to the populace with retirement, social security, medicare, and medicaid is in the hundreds of trillions of dollars over the next 50 years. You can count on the gooberment never addressing the problem, because polititians will always take the path of least resistence. That means printing the money (electronically now). Most of the current QE money printing is being absorbed by the banksters and is only finding it's way into asset prices. When the gooberment has to print ever increasing amounts just to cover all the promises, that's when inflation will really start to show up in everything accross the board. The velocity of money will pick up, because that money will be spent by all the recipients. It's already happening to some degree now, but it will get worse and multiply as there is less and less faith in the currency. Money backed by nothing is nothing but a confidence game (con game). Sometimes you have to go back to basics and look at the big picture, and ignore the arguments about hyperinflation and deflation. If you hold paper promises of a bankrupt country (financially and morally), you will end up on the wrong side of the bet. I'm betting on the gooberment doing the exact opposite of the right thing. Everything is completely corrupted now, including all financial markets. They lie about the true inflation numbers, unemployment, obamacare, and everything else. By the way, I just found out that my health ins. premiums will be doubling because of odumbocare. How's that for some instant inflation, nothing but lies. Stagflation my friends. How bad the numbers will be, no one can predict. I'm betting worse than the 70's with no way to stop it this time. Paul Volker type remedies are not an option now. And by the way, the gold and silver comex markets are just as manipulated and corrupt as everything else. Probably more so, because if the price were to show the real value; the con game ends.

[km101]

In the situation that you describe, the ammo would be of more immediate value to you than paying off a mortgage. You would be more concerned with feeding yourself and defending your family than worrying about some bank and their woes! In times of hyper inflation a mortgage would be a minor worry.

[Taylor3006]

In the situation that you describe, the ammo would be of more immediate value to you than paying off a mortgage. You would be more concerned with feeding yourself and defending your family than worrying about some bank and their woes! In times of hyper inflation a mortgage would be a minor worry.

I dunno, never underestimate being homeless. Germany, Zimbabwae, or any other countries that suffered thru hyperinflation did not decend into a Mad Max scenario where people required ammo more than normal. I imagine the powers that be will be just as happy to toss you and yers to the curb during a crisis as they would in normal times.

[bushboy]

I dunno, never underestimate being homeless. Germany, Zimbabwae, or any other countries that suffered thru hyperinflation did not decend into a Mad Max scenario where people required ammo more than normal. I imagine the powers that be will be just as happy to toss you and yers to the curb during a crisis as they would in normal times.

Are you forgetting that these countries stripped away their citizens' right to have guns before their hyperinflation nightmares? If you don't have a gun, why would you require more ammo?
And as far as getting tossed to the curb either during a crisis or not, guns with ammo is the best way to resist tyranny. Without them their citizens were forced to capitulate hence no Mad Max scenario.

[Taylor3006]

Are you forgetting that these countries stripped away their citizens' right to have guns before their hyperinflation nightmares? If you don't have a gun, why would you require more ammo?
And as far as getting tossed to the curb either during a crisis or not, guns with ammo is the best way to resist tyranny. Without them their citizens were forced to capitulate hence no Mad Max scenario.

No gun control laws in Weimar Germany, least nothing excessive and hardly a dictatorship. Zimbabwae a different matter, but they are not the only two examples of hyperinflation in history and none that I am aware of led to wide scale armed insurrection. Riots, increased crime, and unrest but nothing where ammo was preferred over other hard assets. I agree that armed citizens are the best defense against tyranny, but the discussion was hyperinflation. Resistance to being lawfully evicted from a home would just as insane now as it would be in a crisis. Our Depression had many examples of this but other than a bit of organized civil disobedience, people understood that the law was the law no matter how distasteful enforcing it was. Being homeless or a refugee during a crisis would disastrous, history has shown us that time after time. Pay yer mortgage with devalued money, it would be insanity not to.

[MaryB]

We have never had the level of corruption in the banking system that we have now. Banks foreclosing on homes they do not even have a mortgage on comes to mind.

[km101]

I dunno, never underestimate being homeless. Germany, Zimbabwae, or any other countries that suffered thru hyperinflation did not decend into a Mad Max scenario where people required ammo more than normal. I imagine the powers that be will be just as happy to toss you and yers to the curb during a crisis as they would in normal times.

In times of hyperinflation the banks will have more worries than foreclosing homeowners. And I did not advocate stopping mortgage payments, just not selling a valuable survival commodity to pay off your mortgage. I would rather continue to make payments and keep my ammo for safety sake.

Ammo is a very potent barter commodity as seen in recent times! And if there IS civil unrest, you can take ammo to a safe location. You cant relocate your house.

[oldred]

I said over 25 years ago that 22 RF would spend like money someday, looks like that time may not be far away!

[uscra112]

I dunno, never underestimate being homeless. Germany, Zimbabwae, or any other countries that suffered thru hyperinflation did not decend into a Mad Max scenario where people required ammo more than normal. I imagine the powers that be will be just as happy to toss you and yers to the curb during a crisis as they would in normal times.

Germany didn't quite go full-on Mad Max, but it did have competing groups of armed militias (Communists first, then Nazis in reaction), in the streets, rather reminiscent of the gang warfare in our inner cities, but political/social rather than just drug turf wars. The Communists did enough damage to their natural enemies, the middle-class and small businessmen, that the middle class embraced the Nazis, and you know the rest.

In Rhodesia the general populace doesn't need ammunition, because machetes do the job for them very well.

[bushboy]

No gun control laws in Weimar Germany, least nothing excessive and hardly a dictatorship.
HUH? Not trying to argue with you but thought you might be interested in this.

http://www.stephenhalbrook.com/registration_article/registration.html