So what’s the deal with gold and silver? Why are preppers so obsessed with it?
Pretty simple really.
Because the volatility in our currency market is a very real threat that can cause utter financial ruin overnight. So, many preppers use gold and silver as a tool to protect against complete loss of wealth.
Many of you guys know that precious metals supplier JM Bullion is the exclusive sponsor of The Daily Prep, and has been for the last little while.
I was recently browsing their website and came across a recent guide that they have created, entirely to help the “newbie” precious metals investor. I’ve been reading through it for the last little while, and thought I’d share some of the history of gold and silver.
The History of Gold and Silver
The first part of the guide deals with the history of gold and silver. Gold and silver have been used as currency for thousands of years, in virtually all corners of the globe. They have been used as money for so long, that they have practically been “money” for longer than money has been money.
Gold vs. Silver
Over the years, gold has been associated more with luxury and prominence, while silver has been more associated with utility. Even today, silver has a ton of uses. It’s used in:
- Solar Panels
- Film Photography
- much more!
What is the “Gold Standard”?
The Gold Standard is a term used to describe a currency whose valuation is directly tied to a set amount of gold. As the valuation of gold increases, so does that of the currency. At any given time, a given quantity of gold can be exchanged for a set amount of currency, and vice versa.
From 1785 to 1861, the United States was on an official precious metals standard, and up until the 1930’s, currency and precious metals were exchanged interchangeably. In 1933, Franklin D. Roosevelt enacted executive order 6102, which forbade private stockpiling, and required citizens to turn over gold to the government.
The next year, in 1934, The Gold Reserve Act was put into effect, essentially ending the direct exchange of currency for precious metals at a set amount. Since that time, precious metals have had to be “bought” and “sold” at varying rates against currency.
So How Pure is “Pure”?
People often wonder, “What is the highest measure of purity?”. For gold, 24 karat is as pure as it gets. There is nothing more pure.
For silver however, the term “sterling” can often be confused to mean absolutely pure, when it isn’t. To be considered “sterling”, silver only has to be 92.5% pure, with the remaining 7.5% typically being made up of copper, or a much less valuable metal.
For silver coins and bars to be considered “pure”, they typically get a rating of .999, which means 99.9% pure. Sometimes you will see an extra 9 in there, making it .9999.
For more on this, and the complete Beginner’s Guide to Precious Metals, check out JM Bullion.
Check out my post Should Preppers Buy Gold and Silver?