Precious Metals & Our Currency
- March 21, 2023
- By Jared Daub
We are seeing a massive shift in our populace on the topic of money.
Precious metals & our currency: Most people look at precious metals as “fake” money. How ironic. We have, as a populace, been convinced that our fiat currency, backed by nothing but our government and our belief in it, is somehow superior to physical assets. I know, that was a mouthful. I’ll explain what I mean.
Currency affects every aspect of our lives. I know, you are rolling your eyes. “Obviously, Jared, we use currency daily. Get to the point”. Hang in there, I am getting to my point.
Currencies of past were backed by something. Think about how you would function without money as you know it now. What would you do to get the things you need everyday? How would you “purchase” your goods? When we boil down the most basic forms of currency, the simplest form is trade.
Before I dive deeper: keep in mind that what I write below is simply my opinion. You might walk away with a different view, and that is fine. If you are considering investments, I’d recommend finding a professional. I’m just some unqualified dude sharing a personal opinion on the world as I see it. Take it with an ounce of skepticism and do your research. Anyways..onward.
Trading is the bedrock of what creates currency.
If I want to buy lunch, or purchase lumber, or go out to eat, I declare to myself that I value those goods or services more than the money (fiat or physical) that I possess. It’s a pretty simple concept. If you pay a mechanic to work on your vehicle, you are saying that you VALUE a functioning vehicle more than the money in your hand right now. It might make you angry that you need to spend money to fix something, but at the end of the day, the item that needs fixed is more important than your money in that moment. We are engaging in transactions, small and large, every single day. Each one is a trade. Sometimes it is our TIME for money. Sometimes it is our MONEY for time. You see my point?
Trading occurs whether a currency is involved or not. It pre-dates structured governments. When governments collapse, and no central structure is created, you are often left with simple trading. There are pros and cons to this, but trading is a bedrock aspect of currency. We trade things we have (sometimes money) for things we need (food, water, shelter, maintenance, etc.).
Lately, I desire to return to that era of trade. When you would work face to face with your actual community, and trade things you have for things you need. That level of interaction and cooperation can create extremely tight knit communities. But lately, we live in a world of fiat.
What is a fiat currency?
A fiat currency is one backed by no physical assets. For example, the dollar USED to be backed by gold. That is, until the great progressive regime led under FDR dismantled it. Oh and he made the collection of precious metals and bullion illegal. By executive order. For, you know, your safety and prosperity and such. FDR demanded under his administration that everyone with more than $100 in gold bullion relinquish their remaining precious metals to the federal government. Weird. Our federal government infringing on our rights as free citizens. That won’t ever happen again. I’m rolling my eyes here.
The fact is, prior to removal from the gold standard, the federal government has shackles on its grubby printer fingers. Removing the backing of gold had largely loosened those chains, and the federal reserve, unsurprisingly, craves printing more and more money.
Fiat currencies drive inflation and can lead to hyperinflation.
I remember one conversation I had with an elder about how little they made in the 70’s and 80’s. “I was able to make it work and I made less than $30,000 per year.” At face value, that seems crazy. But if you look at inflation since 1980, that $30,000 equates to $109,529.13 in today’s money. In a more stable market. With less expensive goods and services. Yeah, you folks who grew up in the 80’s making $30K had it MADE. I digress.
What is largely driving this is the federal governments uncontrollable spending. But this leads to far, far bigger issues. Think about the rate of inflation I listed above. What if you had saved $30,000 in a bank account and never touched it from 1980 until now? Want to know something weird? IT IS STILL $30,000 in your account! I mean, sure, you might have made 1/10% in interest, but you LOST value and buying power over time. What does this mean? Your money you use daily is volatile, and it is subject to the desires of a reckless government. It is, after all fiat. Meaning: FAKE.
So how do precious metals come into the conversation?
They are a hedge against inflation. But in order to understand the precious metals and how they combat inflation, we have to understand what they are.
There are several types of precious metals people will collect. Most often it is Gold, Silver, Platinum, and Palladium. These are the four main types of precious metals people will store and collect. They are all extremely rare and in limited quantities on earth. They require an immense amount of labor and machinery to find, mine, and refine. They are extremely useful in medical and technological fields, and they have possessed intrinsic value since the dawn of mankind. In today’s world, they are even more useful because they have tangible value for many industries.
When I explain precious metals to people, I am often met with a sense of distrust or skepticism. The federal government has done its dirty work mighty successfully. They have effectively convinced us that real, hard, tangible money is fake, and fake money is real. I’ve said it before: we live in a clown world. The reason people cannot fathom collecting precious metals is largely because we are so removed from this practice. Also, the government likes its tax money, and it’s harder to track precious metals transactions, but that is a point I’ll discuss further down.
Ultimately, precious metals have value for a host of reasons. Because of this, and because there is such a limited supply, their value is destined to continue to increase. And history has shown this: Overall, precious metals increase in value. Like everything else, there are highs and lows. And just like every other investment, it is absolutely possible to lose a ton of money if you buy precious metals high, get scared and sell low. But that’s not my personal objective. My personal objective, and what I am passionate about, is fighting inflation.
Let me explain in a short example how this can work:
I bought a ton of silver at $14/ounce. Let’s hypothetically say I bought 200 ounces. On the date I purchased this, the silver cost me $2800. From the date I purchased this specific lot of silver, inflation has gone up 27%. In other words, $1 when I bought the silver is $1.27 today. My buying power of my dollar went DOWN. If I would have saved $2800 in cash from that point to now, my buying power is actually $2044. Costs of goods have increased. Cost of living has increased. And in the meantime, our government has gone on a printing rampage.
Now, let’s look at silver prices TODAY. Silver spot price is currently (as of writing this article) at just under $23/ounce. Street price is $27-28/ounce. Let’s settle for an even number for my example at $25/ounce. 200 ounces TODAY would cost you $5000. Right about now, you’re assuming I made money. But I first like to factor in inflation. Remember how I said inflation today is 27% higher than when I bought this silver? So in today’s dollars, I spent $3556 on my silver (2800 X 1.27). Now take $5000 and subtract $3556 and you will see I am actually $1444.00 ahead of inflation. Pretty amazing, right?
Before you all rush and buy silver, let’s discuss delayed gratification:
If you look at outlying examples, like I just showed you in my personal life, you can walk away assuming there is no risk. There is 100% risk with EVERYTHING you do with your money. There are NO guarantees. Please keep that in mind. However, historically silver and gold are rising in value. This has been consistent when looking at large amounts of time. Precious metals are NOT quick flip money makers. I invest in precious metals with the intention on holding them for decades. I want to take CASH I have now, and turn it into a physical asset that becomes MORE valuable as inflation rises.
The more our federal government prints, the more I want to buy, sell, and trade in precious metals. I like to purchase my metals cash, face to face with dealers, with no paper trail. For reasons and such.
What forms can precious metals be purchased in?
One easy way individuals can collect silver is what is called “junk silver”. Many US coins from 1964 and before feature silver. This is especially true of dimes, quarters and half dollars. If you have quarters that are 1964 or older, they are 90% silver. The same is true of dimes. Junk silver is the least expensive way to get into silver. It is also great because it is small quantities that can be traded for low value goods.
The next way people will purchase precious metals is bullion or rounds. Often, people will collect precious metals in 1 ounce increments. They are not as easily traded for small goods as junk silver, but they are better than having 10, 20, or 50 ounce bars. If all you have is one 50 ounce bar, and what you need is a chicken to eat or raise for eggs…you’re on the crap end of that stick in that particular trade. But if you could trade two silver dimes for a chicken, you’re in business.
Gold, platinum and palladium are much, much more expensive. Gold is currently just under $2000 per ounce. Gold is possibly the most desired precious metal, but it has a steep buy in. It is also not easily broken into small fractions. Gold is great if you need to trade for a complete rifle, or a few thousand rounds of ammo, or body armor for your group. But it’s not great for transactional instances. That’s why I have both.
You can really get into the weeds with this topic, but hopefully that paints a brief picture of various forms of precious metals you can purchase.
Inflation is driven by reckless government officials, and we carry the burden of their destruction.
Possibly the most appealing reason to get into precious metals is to hedge against the system this faux Republic has created. Politicians and the political elite will print money, line their pockets, and transfer it to offshore accounts to invest in land, business, stocks, and other hard assets. We carry the burden and suffer the consequences. We allowed the government to bastardize our money and economy, rather than hold them accountable to their actions. The governments has historically robbed us in so many ways, and they will continue to do so, make no mistake about it. I desire to have a hedge against that. It’s why we own rifles, body armor, night vision, thermal, capable vehicles, comms, camo, precious metals, food and munitions. All of these can also be viewed as supplementary investments and hedges against inflation.
Precious metals are not the only physical asset to consider, but they are important.
I would never recommend someone dumps all their cash into metals. I think that would be unwise. I also don’t recommend amounts to anyone. I think each of us must analyze our financial situations and make a determination. I try to have 10-15% of what I save in precious metals. That’s not gospel, but that is simply my personal position. Yours might be way different, and that’s ok too.
My objective is not hoarding massive quantities, rather having realistic quantities. It might be cool to have an entire room full of metals, until you have to move from that location quickly. I want enough to be able to trade effectively when (not if, in my opinion) our currency collapses. I want to plan well for my family, to take care of my family in a time of need.
The government has abused us time and time again.
Gun control, property taxes, regulations, restrictions, permits, fines and much more are a reality of our existence. The government, in my opinion, is an out of control freight train. It needs to be stopped, to be held accountable. They have abused us in the past, and they continue to abuse us daily. I desire to have assets on hand that allow me to stand up and say “no more”. I know much of our following feels the same.
When they say they want our guns, our answer is no.
When they say they want our land, our answer is no.
When they want us to take their medicine, our answer is no.
When they force their food on us, our answer is no.
And when they come again during the awakening of our nation to strip us of our gold, silver, and other assets, our answer is NO.
Precious metals are one tool in the tool box. We want to know: did you find this article helpful? Are you considering precious metals? We aren’t experts. We are regular people just like you. We want to provide for our families and communities and live life peacefully and well. Just like you.
So where do you buy precious metals?
The first place to look is your local flea market. I like going this route for small quantities (100 ounces or less) because I can pay cash and leave with physical silver or gold. I never purchase silver or gold I cannot physically hold. I pay cash because it’s none of the governments business what I’m doing with my post-taxed money. Start there. There are also websites that you can purchase precious metals from. I am more skeptical of these because I want a bit of anonymity with my purchases. That doesn’t mean websites are bad, it’s just a personal preference. Be CAREFUL with all online transactions. You can get scammed. ONLY purchase goods from reputable sources online.
Before you buy, make sure you check spot price. Just type “Silver spot price” into google and you’ll find a host of sites that will tell you current prices. It is normal to pay $2-5 over spot price for silver. This is how dealers make their money. If you were to sell your current metals, you will likely only get spot price, unless you are bartering for goods, then you can typically ask above spot. It depends on how you value the goods, and how the person you are trading with values the metals. Don’t get upset when you pay over spot, dealers need to make margins too.
At the end of the day, silver, gold and other precious metals are just another form of currency. It’s a form I hope to help you better understand through this blog. But keep in mind: this blog is not all encompassing. I would suggest that your next step is to dig deeper on your own. Look at past performance of silver and gold. If you want a big laugh, type in your salary from 20-30 years ago and use this inflation calculator: https://www.usinflationcalculator.com/
You might cry. Or laugh. But that’s your business. Some of you make more money today, but had more buying power 20 years ago. Depressing is a good word to use to describe that reality.
I hope this article opened your eyes a bit. I hope it was helpful and entertaining. Let us know if you found it helpful, and if you did, please share with a friend!
Jared Daub
CEO / Owner
TA Targets & The Exodus Companies
