Yet another digresion about precious metals as currency

i do find it wierd how little things like platinum and gold and silver is worth so little since these things are universally seen as valiuable and made exelent medium of excange since the beginning of civilazation for verious reasons that still applly. so i would expect gold and silver to have depreciated in valeu significantly but not to the point where they wheren’t worth a lot in trade, i would expect them to become one of the medium of excange that people use to conduct trade post cataclysm beside things like drugs and ammo since it doesn’t go bad or spoil, is rare enouge, can’t be counterfitted, is easy to carry in smalle units and almost everyone knows or would believe it to be valeubul and therefor it would be valeuable. the same might also apply to gemestones and pears but those might be counterfitted rather easely. so i would expect every merchent to have some gold and silver in there stock since it would be one of the primery thing people use for trades or to round out trades beside things like drugs and ammo.

Economy bases on supply and demand. While gold and silver is “rare” nowdays, it isn’t in an apocalypse of that magnitude.
Many household do posess a small amount of gold (earrings, rings, chains, gold teeth, collectable coins, religious symbols, …), let alone larger structures like bank vaults.
Let’s assume that every household just posses 1 gram of gold. And let’s assume, that there’s a survivor rate of 1 in 1000 (which is incredibly high - it’s probably closer to 1 in 100k). That would mean, that every survivor could get his hands on 1 kg of gold.
1 kg of a metal that does not have any purpose at that point. It has use in a lot of things now, but almost all of these things get pointless or are too difficult to achive in the cataclysm.

You can’t eat it. You can’t use it. There’s a lot of it around (if you’re brave enough to raid structures/zombies). If society recovers from that, it probably will regain its value (or at least a big part of it), but “right now”, when fighting for your life, it’s probably just as valuable as lead to use it as a shotgun slug.

Well… No. It can be counterfeit. Really easily, to be honest. If you’re not an expert in gold and don’t have ways to test it, this can be done really fast and cheap.
Even now, in real life with all that technology to detect fake gold, it can be done with tungsten and actually serves a real problem.

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I don’t know which is less realistic to keep their value after the apocalypse - noble metals, or dollar bills.

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Most certainly dollar bills. But I’d say both. I’d think dollar bills would loose all value and noble metals will take a dive too, just not down to zero.

gold makes a great store of value and medium of excange, we have all of human history since agriculture to prove this, it was only untill 1971 that the US stopped the goldstanaard that this might have seased to be the case. i do expect noble metals not to be worth as much after the cataclysm as they where before (on account of many goods being much more valuable than before) but they should still be valeuable enough that they could be used as a defecto currency since everyone already knows it to be valueble.

counterfeiting can be done for whatever you use as currency i could fill cans with water and pass them of as canned goods or give bullets filled with junk as real bullets and any traider that doesn’t know his stuff will get swindelt. so the people ectually making a living from trade would be able to tell real noble metals from fake one most of the time (unless its a really good counterfeit) and would only use real gold for trade since they have a reputation to uphold if they want to keep their trade partners.

edit:grammer

I wouldn’t be so sure. At least you can use dollar bills for their paper (starting a fire, flintlock rounds, etc). What could be the use of gold?

That’s… not how currency works. It has to be assigned a value and there has to be some consensus about it.
If I take your gold for my weapons and food, but can’t buy stuff with it because someone states that they don’t want useless gold for exchange, I probably starve to death. Therefore, I don’t accept gold in the first place to don’t risk anything, which will devalue gold.
Here’s a good read on the value of gold to acient native americans, although I can’t confirm the quality or accuracy of it.

Well, if you explain to me how they would be able to tell if it’s fake gold or not, I would be a little more convinced than now.
You can see how some people react to a crisis right now - and you really think they would be honest and fair in an apocalypse? Well, probably some, but certainly not all.

Yes, all goods can be counterfeit. I did not state otherwise in my answer. I just objected your statement, that gold can’t be faked.
Also, I can open up a can and just take a sip from it or open/testfire a bullet. I can’t do that with gold.

It’s funny, I actually have written up a “Of course it can be used as a firestarter, which would assign some value to it as a material.”, but deleted it, as I wanted to keep it simple.
And I’m sure I wont give you 10 breads for a 5 $ bill to start a fire.
Gold can be used as a shotgun ammunition and a conductor. And to weigh down your dollar bills tinder so it doesn’t fly away. So it’s not totally worthless :wink: .

the lack of a “practical” aplication for gold as an argument for why it shouldn’t hold any value goes for most of human history as well since it had before computers where a thing no real “practical” application but dispite this it was valueable and was used mainly as a medium of excange and store of value as soon as we had developet agriculture and settled down. so i don’t see why this suddenly wouldn’t be the case after the cataclysm since trade hasn’t broken down and the belief and cultural value of gold hasn’t either.

We can discuss this for a long time, but I’d suggest you to take a look at why it was valueable at these times. Here a top 3 hitlist:

  • It was rare.
  • It was agreed that there has to be something standardized to skip a direct trade (I give you bread but I can’t use a haircut right now) by a lot of people.
  • It was hard to counterfeit.

Now, what’s the difference to an apocalypse right now?

  • It’s no longer rare (modern mining equipment allowed large amounts to be mined fast).
  • There’s no centralized agreement to use gold as a currency (it takes time to build this up after an apocalypse).
  • It can be counterfeit more easily.

There was a good reason that the gold standard was dropped.

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So here’s the practical question:
You’re trading with an NPC. He doesn’t have anything you need, but he has some things you want: an intact riot helmet, a rifle scope, a bunch of MREs, an actual broadsword. He’s also got some gold. The only thing you have to trade him is your backup gun.

How much gold would he have to have before you consider giving up your backup gun in exchange for the gold instead of the helmet, rifle scope, MREs, or broadsword? Because there is pretty much no amount of gold where I would make that trade.

Gold only has speculative value: you trade for it under the assumption you can trade it for someone else. Most other goods have practical value: you trade for them under the assumption they’re going to improve your chances of survival. As long as most people believe the speculative value of gold is nearly zero, the speculative value of gold is nearly zero because no one expects they’ll be able to trade it with anyone else. It’s a bit of a self-fulfilling prophecy.

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Great discussion so far, thanks for your answers and patience. Again, terribly sorry for my English.

If I may add a couple of points… gold or other currency will only have value if the community responsible for its issue is well-known and respected. By themselves, Hub gold coins don’t have any value, but Hub itself is known as a place where select few can purchase some good stuff. So their currency reflects this situation.

However, I really think that it is a bit early to introduce real money. In-game “dollar” exists only as a way to compare the barter value of different things. Years will pass before anyone will accept useless yellow circles or pieces of paper in exchange for real goods. The situation in the world of Cataclysm is just too volatile and unstable. Every survivor needs ammo, food and meds right now, while money is essentially just the promise of future goods. For this to work, you must first be sure that the future for humanity even exists.

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That’s exactly what I’ve tried to say, thank you.
Gold or other currencies only pop up if people are wealthy. I remember reading that some country returned to good to good trade when their money devalued (Uruguay? Paraguay? Colombia? I don’t remember and can’t find the article anymore).

gold unlke most metals is also not magnetic so you could test it with a simple magnet. you can drag it accros a unglazed ceramic plate to see if there is a gold mark on it. you can test the density with a scale and a graduated cylinder to determine the valuim.

source: https://www.bullionbypost.co.uk/index/gold/how-to-tell-if-gold-is-real/

That consensus is already present precataclysm and where many currencies get there value do to the trust placed in the government that isseus them (which are now all gone) noble metals are seen as having innate value and i didn’t say that gold would be THE currency everyone would be using but it would be used as de defecto currency along side other high value items that are relatively easy to transport, store and don’t spoil (ammo and drugs) to make trading easier so you don’t have to drag around a lot of stuff if you want to buy something.

It would be worthless in trade since paper is so readelly available you can find it really aywhere in the game so no body in their right mind would trade for it if i can just find it lying around for free everywhere. this isn’t the case for gold so if i trade for gold i know for a fact that you can’t just find more of it laying around everywhere since it is so rare.

gold is still pretty rare both in real live (you could fit all the gold above ground in a cube 20,7m on each side) in game the quantities you would and do get from looting are very small and gold and silver are still far rarer than other things like ammo, guns, drugs or food but not so rare that they couldn’t be used as a regular medium of trade like purifier.

as for the central agreement on gold being valueable. Everyone from before the cataclysm would have learned that gold would be valueable this is something that everybody believes independent of what the government does or says so i do see the dollar losing all value given the government collapse but i don’t see this happening for gold since it’s precieved value relies on that everyone already believes it to be valueable and knows everyone els believes this as well. this doesn’t change with the cataclysm. you do make a fair point however that gold wouldn’t be used as a semi-currency directly after the cataclysm since it would take time for trade and practices around it to develop as the remnents of humanity form factions. however it would seem logical to me that after groups had formed and more large scale trade developed the need for some sort of goods/items that could function as semi-currensies would be needed for practical reasons and for convience (why bring a few kg’s of food with you if you are looking to trade if you can just take a few grams of drug with you with the same value) gold is a perfect candidate to fill that roll beside things like drugs and ammo.

see my previous answer for the last point

The factions in the game that start establishing currency relatively early are the Free Merchants and Hub-01. The Free Merchants are “6 busloads of office workers” and have some accountants and economists in their number; Hub-01 are the survivors of a research lab and also have money theorists.

In both cases, they’re really establishing scrip for their internal convenience after US dollars become worthless due to hyperinflation and severe difficulties in demonstrating ownership of distant resources. Both scrips become currency internally and trade goods elsewhere, and both are intentionally designed to be hard to counterfeit and difficult to accidentally inflate.

Some of the proposed future factions, such as the Fence Men (free convicts still inhabiting their former prison) are not going to think so rationally about currency, and will use cigarettes and bullets for currency and probably think gold has value - which of course means that it has value for them. But the Fence Men are also going to be very vulnerable to inflationary shocks when someone shows up with a truck full of cigarette cartons and gold chains and buys out everything the Fence Men own.

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the point im trying to make is not that gold would be used as money as we have it right now, gold would be used alongside other high value easy to tranport items as the clossed thing you would use to currency: to balance out trades or if you have a surplus of a certian good (got 15 guns form zombie soldiers laying about) and don’t wan’t to buy all kinds of random stuff form a merchant for your goods. that is why i say defacto currency it doesn’t have a set price or cental regulator instead it is usefull becease you know that you can carry something that doesn’t difficult to transport but does holt a good trade value in most if not all places but is divisable in smaller units to pay for things like a single meal, place to sleep or lets say 5 extra bullets to top of your magazine.

I think this is the key point, the currency will depend on the group. The hub might even be interested in the free merchants currency, because they know they can turn around and use it to trade with them. I wouldn’t expect an immediate post-apocalypse economy to unify around any one currency anymore than I would expect them to unify around any one governing body.

That would lead to additional interesting decisions, when you have traded a lot with the hub, have a lot of their money, but the free merchants have the good you want to buy, and don’t value the hub currency as much as their own.

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that might work fine for within the hub or refugee center but outside of there there value of these currencies is much if not worthless since there value isn’t garentied outside of these places (hub might have the right thought there making their coins out of gold) so i would find it hard to believe that anyone outside of the refugee center or hub would accept these in a trade unless at a significant discount or if they are going there anyway since the only way that they are usefull is if you actually go there. the hub gets around this by making there coins out of gold (maybe those money theorists had the same thought as me) and the refugee center could also get around this by adopting a gold standaard (merch for a fixed amount of gold or silver that ancers thier merchs value and makes it a realyable currency).

Ah, I see. This certainly helps to understand certain peculiar things in the game. Hub 01 will have some problems with their internal economy, though. They don’t have the steady source of gold and rely on mercenaries to get it, if I’m not mistaken. As a result, every Hub Coin will have too much value assigned to it, leading to unintentional deflation. It is too cool to be a scrip, in the other words.

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It’s always possible that Hub-01 is filled with a bunch of ivory tower intellectuals and led by a silicon pointy-haired boss, and thus they always do the right thing and still always get caught in the unexpected consequences. Actually, that’s pretty much their effective governing philosophy: “Oops, that didn’t work out the way I expected.”

And we already have support for local currencies not maintaining value: you can trade Merch to the Free Merchants at 100% of value, regardless of relative Barter skill or supply, and the same with Hub-01 coins to the Hub, but the Hub treats Merch as a trade good and that Merch that you can redeem for a meat jerky at the Free Merchants is worth a lot less at the Hub.

The Free Merchants have better things to do with their economy than let some yahoo with a bank truck roll up and buy out everything of value and leave them a large stack of soft metal.

spicyshadow, you still haven’t addressed the issue of whether, in game, you would actually trade a useful item to an NPC for a stack of gold. My assumption remains that you wouldn’t, which to me means that your indicated value of gold is as close to 0 as the value the game currently assigns.

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