We still produce a lot of cheap food in this country.The price may well increase but not to the extent in more populated countries.

It is better to have some hedge against inflation like metals or real estate than have nothing.I don't think the share market can be trusted at all.

They are making noises in the USA of taxing Wall St but it will be too little too late.Once the inflationary money is out there,it cannot be taken back easily.

As in the USA bankers here are not loaning to businesses or farmers.So the Share market is gaining value with industry closing down and unemployment rising.The share market is just reflecting an icrease in inflationary money.So the bankers are fueling speculation rather than production.

Bazz

I agree with you that food and energy are wealth, but what do you buy them with ? The only times in history that the value of gold has gone down is when there are other "investments" that are are more lucrative at the time. There has to be a medium of exchange and all I am maintaining is that Gold has always been the best. Governments can't manipulate gold as a currency traditionally (except by using naked derivatives as they are at the moment or by confiscating it, which Roosevelt did in 1933)The Romans even tried to inflate their metal coinage by scraping the edges of their gold coins which was the birth of modern day milled edges which could not be tampered with. Why do you think that every central bank in the world is accumulating bullion ? My question is why all the secrecy by the sovereign banks about their trading and how much they have. The USA refuse to have an audit and maybe this is because they don't have the gold they say they have. Perhaps It has been leased out and become a case of a fractional reserve gold banking. If so,It is probably on the books of whoever they lent it to as well. Germany demands their lot back but why does it take seven years for it to be repatriated to Europe? The only sensible thing that Chavez did was get his back to Venezuela from London before he died. The university of Texas has recently bought one billion worth of gold for its endowment fund.....no dividend, just insurance. Turkey is using gold to buy oil from Iran. It is becoming insidious although not harmful in the usual meaning of the word.

continued

If we want to purchase things from overseas, hopefully our paper will still be acceptable in the future. Gold and silver always will, and has been for the last 2000 years. Unless we go back to a time of exchange barter, Bullion will always be in demand.

I suggest you read James Rickard's recent best seller "Currency Wars" Published a couple of years ago which was very prescient.

Snake, In the case of a major collapse, you might walk out to your
local vegetable farmer and offer him a 1/100 of an ounce of gold for as
much food as you could put in your wheelbarrow.
But is that gold of any value to him ?
A litre bottle of diesel might be, but you don't have any.
Remember in Arjay's scenario the financial system has collapsed and
there is no way to value the gold.

However he might ask you to do a few days of labour on his farm.
However if you had some electrical knowledge you may be able to get
his defunct wind generator going instead.

If Arjays predictions come true that is what we would face.

However I don't think that is the way it will go, I suspect it will be
a bit more gentle than that.
I think it will come on gradually as industries and individuals will
find that the cost of energy is devouring their profits.
You can already see that happening here in Australia where businesses
are having difficulty with electricity costs. Those costs get passed
down the line to the next customer. This where Tony Abbott's $150
roast lamb dinner will come in.
Coal will soon become more expensive and of lower quality.
This has a very bad effect on net energy and turns the screws a bit more.
When Ankeringa shale oil in Sth Australia gets going there will be a
instant upstep in fuel prices in Australia as it will have to be
shipped to Singapore to get it processed into petrol & diesel and then
shipped back. That is not expected till about 2018 at the earliest.

I keep remembering what I read about complex societies.
It seems that they start having some minor problems with supply of
various things, but the difficulties start accelerating.
Complex societies it appears collapse very suddenly.
I am reminded of the fuel tanker drivers strike in the UK.
Three days after it started most service stations were dry.
Also after three days people were fighting in the super market aisles over a can of beans.

Pericles wants to know how high the price of gold will go with a monumental collapse.Like everything Pericles,it all depends.Some people may store food ,alcohol also becomes a medium of exchange and store of wealth.Honey will store for years at room temperature.

Precious metals could easily treble in price.Some say gold $10,000 per Oz.Obama is now cutting Govt spending.It depends if it is wasteful spending or spending that adds to productivity.

When inflation really kicks in,interest rates will have to rise and that will cause massive unemployment.Unlike the the Great Depression we now have no manufacturing to create work. Most of our jobs are either in services,construction,retail Govt and finance.Many of these jobs are not crucial to our survival so they will go.Crucial to our survival is China.Will they continue to buy our resources? They are presently diversifying their sources of energy/resources.

We need a new Govt bank to replace the Commonwealth.

So it time to get prepared and creative.