There are many reasons that the price of gold has gone up so much over the past few years.
One reason is that the developing countries (especially India) is buying more gold as these countries become more wealthy. Another reason is that it’s a scarce resource so naturally as the population all over the word grows, people will naturally accumulate it whether they know it or not. By this I mean that there are sometimes trace elements of gold used in electronics (especially older PCs) – a very, very small amount but there nevertheless.
Another reason that gold is rising so quickly is the believe that in a mass destruction, end-of-the-world scenario, gold will be the only investment that holds value… And to be honest, it will hold value! The governmental currencies (especially the ones with a fiat currency) will be worth less than the paper that it’s printed on (since the paper no longer makes a good writing surface). But I have to wonder is the end-of-the-world folks acquiring the most valuable assets? What about water?
Wouldn’t water and canned goods along with MRE a more valuable asset? Or even metal like guns and knives? Not to mention blankets, clothes, shoes, horse (no infrastructure means no gas…) and water… lots and lots of water.
Of course to get the system moving again, practically everybody would either barter, write IOU notes, or use gold. Gold is the lowest common denominator and practically has a universal value versus fiat currencies, and personally I wouldn’t want an IOU from anyone.
What if water was contaminated or restricted in flow? In addition to the desert states obviously in trouble, potentially so could all the other states.
I wonder if those houses with solar panels would somehow be a critical part to the recovery of a destroyed society? After all, if somehow the utilities companies were destroyed, those houses outfitted with solar panels would be able to provide electricity for small-scale manufacturing. Perhaps even powering the pump for houses still fitted with water wells.
While you never know what will happen in the world, personally I’m not concerned about doomsday scenarios… but perhaps it wouldn’t be a bad idea to get a month’s worth of cans and bottled water (especially if you already buy bottle water for consumption).
Thanks for readying my meandering thoughts today,