What's a Good "Doomsday Currency"?

(Photo: Adam Gault)

A reader named Marcus Kalka writes:

I have a weird question, but a good one. With all the talk about the value of the U.S. dollar falling and the U.S. dollar losing its status as the world’s reserve currency, I am curious to know your guys’ thoughts on what possible temporary alternative currency you believe would be the most optimal for us here in America in a hypothetical future doomsday scenario — i.e., what one should stock a lot of in his or her basement in the event of a [heaven forbid] total financial meltdown? Historically, cigarettes, alcohol, candy, and even packs of mackerel have been used as a bartering commodity currency where cash is not as useful or cannot be used. And so, my question for you is this: From an economic standpoint, which item do you think would make the most ideal “doomsday currency” in the U.S. for this time period? Perhaps cigarettes or wine? Gold or silver coins? Cans of tuna? Baseball cards? Bottles of water? Any thoughts? And any ideas on a potential makeshift currency sign?

Tough one. How about … gems (the old standby), cell phones, iPads, SIM cards, incandescent light bulbs, toolboxes, running shoes …


Angel Eliza

Knowledge of how to make and do all these things is rare and precious. Without that it won't matter after a few years if you survive or not. The Broader the base of info, the greater your "Marketability".

Justin Trombley

honey would be a very good choice I believe. It doesn't go bad. It could flavor foods or drinks and it has a bit more nutrition benefits then plain sugar.

Geoff

When the fiat money fails, real (gold and silver) money always prevails. The U.S. keeps going off the gold standard, then back on it when fiat money fails. This most recent run is the longest it's ever lasted, so it's about time for another currency failure and then a switchover.

The problem with gold as a currency is that one ounce has enormous buying power in a gold-standard economy. You'd use one of your ounces to buy a car - not something you do very often.

The best daily-use money is probably fractional silver, like pre-1964 silver dimes. "Mercury" dimes are a good bet, because no one has to look at the date to figure out whether it's real money, or fake.

Even then, each dime would have a few modern-day dollars' buying power, so maybe nickels (as long as they contain nickel)? That's what the preppers are buying like crazy now...

assumo

The question is moot. Consumption goods would be extremely volatile. People would undoubtedly have stockpiles of what they found important, producing scarecity of those goods in other areas. Depending on how bad things got, or the nature of the events that led to doomsday, the ideal commodity could vary from place to place. You'd really have to feel things out in your locality, and my guess is that in the absence of the rule of law, brute force would unfortunately win more concessions than any trade (once the bullets ran out).

Doug Lance

Bottle caps, of course.

Joe

Doomsday currencies have to be either a) innately valued [gems, gold, etc.] or b) consumable and vital, such that there is a constant need for them. Food, cigarettes, etc. are all good barter currencies - you know everyone will need/use them and they have a relatively constant rate of usage [demand]. iPads, cellphones, etc. aren't really good currency because they are not something with a constant rate of demand - in particular, the market will be fairly quickly flooded with them, and then demand will be basically zero.

Shoes are an interesting possibility, since they are effectively a consumable (new shoes every six months or so), are a necessity, and have some possible value as a status symbol (luxury value) - Nikes vs. New Balance, or even dress shoes or fancy high heels.

cj

Didn't they create a government agency for this? Alcohol, Tobacco, and Firearms. Those guys will rule if the dollar collapses!

Joshua

Bottle caps?

Duncan

Cell phones and iPads assume that electrical power and communication networks are intact. Gems and gold assume that the people you are trading with are trying to build and store wealth, and moreover can tell a diamond from zirconium. You can always find a market for food and fuel. You will want to tailor your good to your local. If you are near good fishing, stock up on hooks, salt (for preservation), and nets. It you are in the desert you might want to 'stock up' by building a rainwater catchment system. You will benefit your neighbors and yourself by selling the capital to produce more goods than by trying to sell the goods themselves, so fishhooks or even axes may be good investments.

Silver is more useful in electronics than gold, so if you are looking for a precious metal silver is probably your best bet. I believe that most precious metals and gems are overpriced right now, so this is not a good time to stock up. If you need small store for a large chunk of wealth, you might do better to go after something more industrial, like dysprosium.

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Aaron

Antibiotics

Cañada Kid

McDonald's burgers: they'll last a while... http://www.snack-girl.com/snack/cheeseburger-take-2-day-11/

disclaimer: there are dozens, more like hundreds of "McDonald's burger doesn't decompose" claims out there. I don't know which ones are legit and which are staged, but with so many I assume this one, short as it is, must have truth to it.

Johnny Green

Bullets. Lots of bullets.....and saltpeter.

Markus

With guns & ammo, you can get all the rest of the other stuff.

I think the prospect of a "world war" is diminished nowadays in large part due to the rise of multinational corporations and globalism. You can no longer say, "hey, let's grab/blow up their sh#t" because anymore that sh*t over there is our own sh#t!

If society totally collapses, better have some salt & sugar on hand to preserve what little food will be left around.

In the meantime we'll all just continue to be debt-slaves to the money-slavers. F' 'em all.

Eric

Cow's or other animals. Until you trade them you can drink the milk, or eat them. In Africa cow's, donkeys, goats, etc are the means of currency. Water runs in the river for free. Fruit grows on trees, corn grows anywhere. Having a gun and some amo would be nice to have to get access to those "free" things that grow.

_Grz

I think of digital items (i.e. Zynga, WoW). You can easily exchange them by using your mobile. Other suggested solutions are hard to handle in everyday life.

ratchma

Depends on the nature of the doomsday and what becomes scarce (the stuff that becomes scarce is what you want to hoard). In a "financial meltdown" people will require a more secure medium of exchange and so precious metals become scarce. But in the Ghettos of WW2 the fundamental scarcity was food. In the face of a "sudden" invasion I would go for guns.

Tunlaw

As some others have posited here, the currency depends on the depths of your doomsday. Presuming doomsday is adequately bad to merit the name, it would have to be something highly portable and nearly universally useful.

Assembled .22 and 9mm cartridges would be a believable central means of exchange, with perhaps lesser denominations covered by loose gunpowder, canned protein, and fresh water. Setting and transmitting the exchange rates would be complex to say the least. Then there's the matter of amateur loaders creating their own, potentially less-reliable currency to deal with. Perhaps you'd test-fire a sample, analogous to mariners biting into a piece of gold...

Joshua

Seeds.