Negative Interest Rates and the War on Cash

[emordnilap]

Cash is not so much a disaster prep - more not being part of their game. One of the many et ceteras in how I live, if you will.

[johnhemming2]

The inherent value of paper notes is not very much. If you really are into prepping one would presume storing some precious metals or something which should continue to have some value (although not necessarily an easy value to determine).

Notwithstanding my view on this I have not at the moment got any gold or silver in any quantities.

[woodburner]

The inherent value of paper notes is not very much. If you really are into prepping one would presume storing some precious metals or something which should continue to have some value (although not necessarily an easy value to determine).

Notwithstanding my view on this I have not at the moment got any gold or silver in any quantities.

I think the word you should have used is "intrinsic" not inherent

[Catweazle]

.....something which should continue to have some value (although not necessarily an easy value to determine).

Indeed.

My view is that even precious metals are vulnerable, my money's in cabbages.

[boisdevie]

My view is that even precious metals are vulnerable, my money's in cabbages.

That's something I've always found weird. People talk about paper money having no real intrinsic value yet surely (apart from industrial uses) gold and silver are just the same. They only have value because people believe it. In the long term presumably other items of real value (hand tools for example) would have real value?

[johnhemming2]

In the long term presumably other items of real value (hand tools for example) would have real value?

That is true, but holding some scarce gold would give it some value whereas holding 1,000 trowels would take a bit of space. The latter may be a better option, but as a holder of value in a society that has broken down completely (no payment systems, no internet, etc etc) having an medium of exchange has merit.

[johnhemming2]

I think the word you should have used is "intrinsic" not
inherent

Why?

inherent
adjective
existing in something as a permanent, essential, or characteristic attribute.
"any form of mountaineering has its inherent dangers"

intrinsic
adjective
belonging naturally; essential.

[adam2]

I find myself asking the question exactly what short term emergency would cash be useful for?

Having been in the power blackout in the northeast that lasted three to four days, I remember not being able to spend cash because of silly things like not being able to get into supermarkets because the doors were electric and wouldn't open. Tills likewise were electric and were unable to open to take the cash. There was no way to spend it.

I think in a disaster scenario you're better off to be stocked up with food and water for a few weeks. In the very long term, post collapse, if such a thing happens then maybe gold or silver might be useful but who knows.

A minority of larger stores have generators and might remain open in a power cut.
IME, some small and owner operated shops and pubs remain open and accept cash only.
Cash would also be useful if your bank was the victim of a run or panic and cash was not readily available.
Serious flooding can result in cash machines emptying rapidly if there is no safe access for the security vans that fill them.
Taxis are a useful emergency transport option, exceptionally even for long distances, cash is almost always required.

[vtsnowedin]

I find myself asking the question exactly what short term emergency would cash be useful for?

Having been in the power blackout in the northeast that lasted three to four days, I remember not being able to spend cash because of silly things like not being able to get into supermarkets because the doors were electric and wouldn't open. Tills likewise were electric and were unable to open to take the cash. There was no way to spend it.

I think in a disaster scenario you're better off to be stocked up with food and water for a few weeks. In the very long term, post collapse, if such a thing happens then maybe gold or silver might be useful but who knows.

I think cash on hand is just one of the things on the list of what you should have to be well prepared for whatever problem comes your way. Other items on the list are food, water, medicine, fuel,guns and ammo, first aid supplies. tools, generators, chain saws, etc. etc. Cash on hand comes in very handy if you lose your job, or the car breaks down. Not every emergency involves the whole neighborhood and the personal ones can bite just as hard as a hurricane does.
I'm trying to build up the amount of cash I keep in the safe. It doesn't earn any interest at the bank at present so it isn't costing me anything to keep some pictures of dead presidents hanging around. I think two or three months income would be a good goal to shoot for but I'm way below that at present if I discount some I have earmarked for this years property taxes.

[Catweazle]

Cash will be useful until other people figure out it isn't. Perhaps the best thing is to hold a small amount of cash - just enough to spend before people figure out it's actually just paper.

Think about what you would spend your post-crash cash on, if it's not going to get cheaper then buy it now.

[vtsnowedin]

Cash will be useful until other people figure out it isn't. Perhaps the best thing is to hold a small amount of cash - just enough to spend before people figure out it's actually just paper.

Think about what you would spend your post-crash cash on, if it's not going to get cheaper then buy it now.

In a major disruption such as what is going on in Venezuela today you are correct but for any number or lessor events. Ice storms , localized flooding etc. cash will be quite useful. This would be especially true if the communications grids were down preventing you from doing any online transactions.
You will never need half of the things you set aside for a disaster. The trouble is knowing which half.

[boisdevie]

This conversation spurred me to action. I had some money on the bank so thought I'd do something useful with it and bought £80 worth of food that stores well. As long as I don't die in the near future it'll come in handy one way or another.

[emordnilap]

Close the account while you're at it. Do you need it? I mean, really?

[RogerCO]

Cash is useful in almost any scenario for buying stuff and services from people who still believe they can exchange it for something else - especially those who believe that "normality" will return at some point.

As indeed it will in most scenarios, even if the value of paper notes in terms of what you can get for them changes.

Very sensible to keep a stash of cash to hand, whether you expect a fast crash or a racheting down decline - either way you will be likely to be able to use it during the early part of the turbulence.

The only question is how much - which has no sensible answer. The cost of paying someone to move you from where you are to somewhere you want to be is one answer - for example how much will your average pony paddock owner accept for you to take a redundant horse and tack off their hands.

[adam2]

I would suggest, if possible keeping the following.

About £50 or at the most £100 in small notes instantly to hand. About half in your pocket and the rest at home.

A few hundred pounds very well hidden from thieves, need not be instantly available.

From one thousand up to a few thousand pounds in a bank. I would not keep much more than that long term due to the longer term risks to the banking system. A modest reserve is handy for any unexpected and sudden expense.

If you are fortunate enough to have more than a few thousand pounds spare, it might be better to spend it on useful supplies.

If you work, try to keep a little cash at your workplace, enough for example for the fare home if your wallet is lost or stolen.