Money Wise

On the use of Silver and Gold as a means of exchange


On the use of Silver and Gold as a means of exchange

(Provided by Jerry D. Young)


Why will it be used?  For the same reason money was invented in the first place.  Money is a medium of exchange.  It makes barter between two people possible when the first has something the second wants, but does not have anything the first wants.  But another person does have something the first wants but the first does not have anything that the third wants.  The first gives the second what he wants, he gets money in exchange, and then gives that money to the third to get the item the first wants.  And so on.  It only works when the participants agree on the medium of exchange, before hand.

Some places use cattle as the medium of exchange.  Native Americans used wampum.  Salt has been used.  Service (labor) has been used.  The list goes on.  Gold and silver became commonplace because they were very permanent where as salt and cattle are not.  There will be “money” after a disaster because there are just too many cases where one party will not have what the other party wants in terms of goods or services.  Since Gold and silver have been used in the past and are relatively rare, many will be willing to agree to them as a medium of exchange again.

I think during the initial stages of a disaster paper money will be recognized medium, then it will lose it value.  Some will then take precious metals, but some others will not.  There will be a lot of one on one barter, but as it becomes commonplace the old problem of not being able to make direct one-on-one barters will crop up and something will be chosen to be the medium of exchange.  Money.  Some think it could be gasoline: some think .22 LR ammunition, a whole world of other things.  I think people will revert to what they know has worked before, and still works to this day in places.  Gold and silver coinage.




As a side note, salt has been used throughout history as a form of exchange, it was used to pay debt to pay a solider and a lot of other things.