You Can’t Eat Gold
By: Tom Chatham
If you talk to a number of people preparing for bad times eventually you will hear this comment. While it is an accurate observation, it misses the point of a well rounded plan. If you have some wealth and your plan for catastrophic situations is to buy and hold gold and nothing more then essentially you have no plan. That is what this comment really means.
For a person that feels the need to prepare for situations that force you into a survival position you need to place your eggs in several baskets. You need to take care of absolute needs first to get through the situation you perceive. A person needs food, water, shelter, clothing, sanitation, security, heat and light as a minimum to get through difficult situations. You need to determine how long the situation may last and how extensive your preparations need to be to get you through it.
In a normal functioning world a person may be able to get by in a situation with just money. Someone displaced by a hurricane can relocate to an undamaged area and just buy what they need until things are repaired but what good is money if money as we know it collapses?
That is the problem with other than normal disasters where supplies are in short supply and those with them refuse to sell at any price. A proper plan addresses this type of breakdown and prepares you for it. So why do so many people say buy gold and silver if it may not buy what you need in a catastrophic disaster?
Gold and silver are a way to store your EXCESS wealth until the situation stabilizes and commerce resumes in some form. You should not be dependant on PM’s to acquire goods DURING the crisis except in emergencies where something out of the ordinary may be needed such as a tire for your car or medicine for an unexpected illness. The things you must have to satisfy day to day needs should already be in your hands when this type of situation emerges.
This does not mean you may not be able to buy goods at all. Producers such as small farmers, fishermen and producers of other goods that people need may still have a production capability and will still need to sell those products to earn a living. Those that have a medium of exchange they will accept will allow the purchase of these items to bolster the items you already have and extend your supplies.
The value of gold and silver become important when the situation stabilizes and you want to improve your living position. They allow you to preserve your wealth and take advantage of bargains when others are unable to buy and acquire property, equipment, businesses and income producing investments such as rental properties. They allow you to get your hard earned savings from back there to up here where they will be needed to insure a good retirement. Precious metals are your life raft when everything else sinks. They allow you to stay afloat along with your other floatation supplies and reach safety.
When someone asks you if they should buy PM’s to get them through difficult times you should ask them what their plan is for food, water, shelter, clothing, sanitation, security, heat and light. If they say gold then you are correct for stating, you can’t eat gold.