patrick.net

Solari and the Moneychanger sites partnered together not that long ago to create a calculator for easily trading coins. Unfortunately, it doesn't seem to be a tool you can download, that would be a good next step.

How are you going to verify silver content on the fly?

If you know the coins, you'll have it memorized. But I would suspect until it becomes more common, scales would be used, especially if people don't know each other well.

Yes, and a coin dealer I talked to said you quickly learn to recognize silver by feel and sound. I think it's right. Silver has a kind of soft feel to the touch, and a recognizable clink against other things.

Scales are good too, but people will also recover the ancient familiarity with what pure silver feels like.

Using little bits of metal as a currency is clunky. Dollars are much better. Electronic payments can be done (such as ordering from Amazon). Large purchases can be done ie. for cars, trucks, plane tickets etc.

Silver has only appreciated about 3.3% annually since 1913. So, it is about break-even with dollars held in a bank account when you factor in interest.

https://fraser.stlouisfed.org/files/docs/publications/FRB/pages/1915-1919/24568_1915-1919.pdf

Misc says

Using little bits of metal as a currency is clunky. Dollars are much better.

@Misc Not clunky at all if you simply agree to a debt for silver to do a transaction. Dollars used to have "redeemable for silver" literally have printed on them.

So the world can still run largely on promises, as long as the promises can be resolved into physical silver.

You get all the same benefits of speed and convenience, but without the Fed stealing part of all the money in circulation each year and giving it to... whom?

@Patrick There is no reason to have a commodity based monetary system. The Fed was designed to put inflation into the system. It really doesn't matter whether we have inflation or deflation (which would occur under a commodity metal based system), but the numbers are easier when prices are increasing. Also, debt being inflated away has generally caused less stress on a society than when debt is defaulted away.

Also, under a commodity based system interest would not be able to exist (see what compounding does over say a 2000 year term) without there being constant fraud. The financial intermediaries would need to charge storage fees. These fees would be of such an extent as to do away with any perceived benefit of having a locked in money supply.

Sometimes the monetary base simply needs to expand. War is a common enough instance where the government simply needs to be able to print its way into victory. Deflationary busts are another time when there must be a lender of last resort. Such as when the Housing Bubble burst. If there was not intervention from the Fed/government housing prices would have continued to go down, resulting in more foreclosures. higher interest rates on homes (as they would have been seen as even more risky) and even more unemployment. All financial institutions would have failed This spiral would have continued until the system destroyed itself.

We currently have the best monetary system the world has ever seen. There is little friction in the system between buyers and sellers and if we need a few extra trillion dollars, we can add it to the system at almost zero cost (such as with the Covid lockdowns), or heaven forbid a major war.

Misc says

The Fed was designed to put inflation into the system.

The Fed was designed to enrich bankers and enslave people with a boom bust cycle.

Yes, I think that the purpose of the fed is to give a small group of super-rich bankers the sole right to create money for their own benefit.

Everyone else loses.

Their justification is that when debt bubbles implode, the ability to create more money prevents defaults by creating inflation. Maybe that is true to some degree, but it encourages unhealthy risk taking. And a lot of the people saved from default are those rich bankers or their friends. They are bailed out at the expense of the public.

In my ideal world, all debt is clearly marked as debt with a warning: MAY DEFAULT

And that would include all paper money, which would simply be a promise for silver.

Misc says

There is no reason to have a commodity based monetary system. The Fed was designed to put inflation into the system. It really doesn't matter whether we have inflation or deflation (which would occur under a commodity metal based system)

We can have infinite inflation under a fiat system, and we always get that, always.

Do you think we'll ever live in a world where everybody on the planet can own 1 ton of gold? With (reported) above ground supplies, every human being could have TWO ounces. For silver, if just every American bought 2 ounces, that would consume the entire world's production of silver.

richwicks says

Misc says

There is no reason to have a commodity based monetary system. The Fed was designed to put inflation into the system. It really doesn't matter whether we have inflation or deflation (which would occur under a commodity metal based system)

We can have infinite inflation under a fiat system, and we always get that, always.

Do you think we'll ever live in a world where everybody on the planet can own 1 ton of gold? With (reported) above ground supplies, every human being could have TWO ounces. For silver, if just every American bought 2 ounces, that would consume the entire world's production of silver.

Exactly my point. If we base our monetary system on a metal commodity, the system by its nature would be deflationary. Whereby prices would decrease as there would be constantly less metal in the system per capita as population increased and metal was removed from the system by people saving it.

Futhermore in times of financial stress, such as a war, there would be no ability of the government to raise let's say $4 trillion to pay for the costs of the war as that amount of metal would not exist in the country's treasury. Any country handicapping itself this way would find itself losing to the opposing country.

It is easier math-wise for prices and wages to be increasing rather than decreasing.

NuttBoxer says

If you know the coins, you'll have it memorized. But I would suspect until it becomes more common, scales would be used, especially if people don't know each other well.

You can check the coin appearance easily, checking weight is more clunky but doable, but how do you check the silver content in a typical retail situation?

Misc says

Futhermore in times of financial stress, such as a war, there would be no ability of the government to raise let's say $4 trillion to pay for the costs of the war

I guess we would have to save up until we could afford a war.

Sounds like a plus.