Arjay

I totally agree with you and why I have said all along that eventually we will probably revert to a kind of standard that will include gold and or silver because our existing form of currency based on the US dollar as a reserve currency is fading. As you say the gold/silver ratio is well out of whack in historical terms and every day silver is becoming more of an industrial metal.

Raw mustard

My point about reverting to "living in a cave" was probably an exaggeration but certainly going back to the Middle ages. Even then they had gold as money and we have always had a form of exchange based on it. Sure we could sell our labour as a form of exchange, but there has to be some form of manufacturing otherwise we would all be living like Eskimos and have to be totally self sufficient. I think that is drawing an extremely long bow.
I agree that as we descend into a currency decline and inflation, there will be civil unrest and anarchy as there was in Germany before WW. History has a habit of repeating itself.

Bazz

I don't think we will go back to the Middle Ages, but I do think all this debt will have an immediate affect on our standard of living and a different form of currency will develop with more controls on how it will be used.

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Rehctub

I am not sure what you mean about Gold being a barter tool, but if it is a commonly used form of currency that everyone accepts, it will automatically become a universal currency..... but that has never changed over 2000 years. It is already accepted world wide. Paper is just a little more convenient and fits into a wallet and now as a one or zero in a computer. This make is so much easier to manipulate by banksters and governments

Basically I think we are all on the same page here, we just have slightly differing views on the extent it will take. Meanwhile I see bullion rising to compete with paper as it inflates. How much is anyone's guess.

Arjay, I think you have most of it correct except I don't think there
will be the uprising that you predict.
The financial crash will mean that the army will disband because of
lack of pay and the troops will go home to support their families.
All the unemployed financial office workers will be more of a problem
than the troops.
FEMA likewise will not be able to pay its employees, except perhaps
with $Million notes, or Euros.
No, I think your revolution scenario is a bridge too far.

My reason is that everyone will be more centred on their local community.
Remember unlike Australia the US is a country of small towns.
They will not have any interest in national affairs, and indeed what
would a bankrupt US government be able to do anyway ?
Still no one knows just what will happen.
All we can talk about is possible scenarios.

The one thing I don't understand is just who owns the derivatives and
how their failure can bring the house down.

Rehctub & Snake, Your posts about gold and its use as a currency got
me wondering. Like all resources it must follow the Hubbard curve so I
went and had a look for Peak Gold.
It was first believed to have happened about 2000 but some refining of
techniques extended peak gold a few years.
There does not seem to be any firm opinion. It is different to other
resources because it is not destroyed by use.

With a permanently fixed amount of gold currency and a rising
population that would make for a complex economy I would think.
Arjay, there is a nice research project that would be right up your alley.

Bazz

I understand there is a fair bit around, it's just like everything else, we have mined the easy stuff so now it is more expensive to obtain like oil. This is one reason the miners are in the doldrums because they are finding it much more expensive to get out of the ground and smelt. If and when the price of gold escalates, as I believe it will, the gold miners will take off as their overheads remain the same but profits go up exponentially. It might be a year or two before that happens though! In the same way the new discovery of getting oil from shale will be influencing energy & economies.

If fellow contributors here are still interested in the subject we have been discussing, this article that I have just come across might be of interest

http://news.goldseek.com/GoldSeek/1363021883.php