In my previous post, I talk about purchasing a Kirby vacuum from a door-to-door salesman - just like the old days! I did what I could to bring the price to something I could afford and attempted to do some bartering by offering crypto and/or silver rounds.
What I Learned About Cash
What I learned from the experience is that cash is still preferred - even though it's value is depleting. People who are in the know, understand a time is coming where it will be nearly worthless. Businesses are not in the know, they are interested in business as usual. Not interested in the unusual.
What I Learned About Silver
I also learned that silver still has attractive properties that have existed throughout all time. The appreciation and shock when I offered for them to keep the rounds was noted. I think it may have played a role in accepting my offer, even though I did not give them the silver until AFTER the deal was settled as a token of appreciation, not as a bribe.
Right now there isn't very much accommodations for barter. We are living in a cash or credit-centric economy and people are not set up or willing to accept alternatives for barter. I believe a time is coming where that will change and there will be plenty of bartering. If the economy crashes and USD goes nuts, vacuum cleaners are among the first of the expensive items to disappear from people's minds. At that point, barter becomes a real option if you have inventory to move.
For now, cash is still the only option for business and anything other than cash is mocked and not taken seriously. For now.
Central banks are counting on this "cash" mind-set, that there can only be one legitimate currency, so when they make their official CBDC everyone will accept it as the "new normal".
The Real Value of Silver $2240/oz
Those who know and understand see that quality goods and services are becoming more scarce than cash. The effect this will have on economy will be impossible to ignore. What good is cash for a business if you can't use it to hire quality help? What good is cash if you have to constantly earn more of it to maintain your standard of living? Wouldn't it be better to invest into something that is attractive, tangible, with intrinsic value, useful, in demand and something that increases in value as costs increase?
Once AG breaks free from the phony COMEX "spot" pricing (caused by unbacked paper EFT trades) we will see it's value return to it's historic norm - about a dime's worth of silver being a day's wages. At $20/hour, an eight hour work day is $160. A 1 troy oz silver round is about 14 silver dimes worth of silver. That makes the historic value of silver in modern currency $2240 / oz.
I just "refunded" both salesmen MORE then the price of the vacuum, just as a token of my appreciation! That is IF silver were valued at what it has been historically valued throughout history.
What I Learned About Inflation
Kirby vacuums are so old that they were sold door-to-door even back when the US still traded in silver coin. Given inflation, the top-of-the-line Kirby vacuum has not changed in price much since 1955, even though it's 1000% more expensive!
$183 for their top-of-the-line vacuum in 1955. That's over $2K in today's money.
Interestingly, the top-of-the-line Kirby is still about $2K today.
1955's Housewife
But what if the 1955's house wife decided NOT to buy the Kirby for $184, but decided to keep her jar full of silver half-dollars? Her jar would be worth more than a full-featured modern Kirby vacuum cleaner!
That's just the silver value, factoring in the historic and collectors value, it would be worth much more.
If grandma had held on to the silver in 1955, instead of buying that Kirby, she'd be passing on several thousands of modern US fiat dollars to her grandchildren.
Grandma's jar of silver coins would be worth a lot today.
If the grandkids got grandma's old vacuum, they could pawn if off on ebay for a few hundred bucks. Maybe.
Learn From Grandma!
So learn from grandma! I sure didn't! In this case, I bought the vacuum instead of the silver! But at least my floors will be cleaner, the salesmen walked away happy, and I handed both of them 2 weeks wages each, just for selling something to me for a few hours and cleaning my carpets in the process.
And the most valuable lesson of all: I was reminded that silver is fantastic for preserving wealth during times of inflation. Silver has been valued all throughout human history and will be valued even more in the coming economic catastrophe. Silver will do better than crypto, do better than cash and easier to store than gasoline.
Silver is lawful money.
The Better Choice?
Kirby vacuums are still excellent vacuums - but if you had the budget for a top-of-the-line Kirby for $2.5K yet decided rather to purchase 100oz bar of silver for $2.5K instead, which do you think will be more valuable in 60 years?
I can't vacuum the floors with a giant hunk of silver. So I guess I sympathize with grandma on this one. And I want my floors as beautifully clean as grandma's floors.
Bless the Most High!
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People are reluctant to work and barter with commodities outside of their own knowledge. I'm more than willing to make accommodations in person, but most people would rather work with cash than with crypto. Sometimes people will just give me a rare-ish coin, but that doesn't happen often.
I kind of wish people would just accept something more than cash, but at the very least some people pay with coins. Every once in a while, I find a good coin which makes the trade even more valuable.
I agree. Ignorance is programmed, education takes effort. The ignorant believe education is not worth the effort because knowing and understanding things makes them look strange and different from all the ignorant people they are surrounded with. They believe it's better to not know about unfamiliar commodities and stick with things more popular today.
I like crypto, but suppose I can sympathize with caution trading crypto - if the market is up during the transaction you could loose money if it goes down, but if the market is down you could profit much from that transaction when it goes up. No equal weights and balances, everything is topsy-turvy. Silver is much more stable, the buying power today is still similar to the buying power 70 years ago, even while USD numbers have changed drastically.
A Kirby vacuum in 1955 was about $183, or 133 troy oz of silver
A Kirby vacuum in 2021 is about $2100, or 100 troy oz of silver
The silver gained buying power while the USD lost buying power.
Spot on, you did quite the homework.
Thanks @ironshield , I gotta go vacuum my house.
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What an interesting piost. Thanks for sharing.
My pleasure.
That's a great argument for the use case of Hive versus Bitcoin. I try to buy very few things that I can't actually use. Vacuum cleaners are very useful. Silver gains value but you have to sell it to get the value.
I guess having some of both is a good thing.
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!CTP
Yes, I think so too.
All about balance!
Have a great day, @ironshield😀
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That's a really good analysis
Thank you.
I believe the reason why most people prefer to use cash even though its "crashing" is the ease of use. I mean, all businesses accept it.
Though, I am interested when the time comes where crypto would be widely accepted or used the same, or even greater, than fiat. 😊
I have a few silver coins here too. The total is less than 10 pesos during the time of my grandparents (1903) and I wonder how much this cost as of now. I want to sell it but at the same time keep it as it might become rarer in the future. 😊
!1UP
Yes, "ease of use" is how most fraud is successful, because that which is easier, is also easier to exploit. Sometimes, things that are important (like economy) needs to be a little bit difficult and a little bit impractical to keep it from being abused. Just my opinion, even though I enjoy "ease of use" too.
If we really wanted to save for retirement, we would just not eat....
It is all about decisions, and what you need now, and what you can get later.
I know people who sold their houses and got into cryptos... the only problem is, it has been a long wait, and probably still a little bit more... then they will be able to have all the houses they want.
But how much was the discomfort worth?
People are so used to cash, that even after the banks close down, or FED goes out of business, people will probably still accept cash for transactions for at least a few months.
However, i find it weird that people still take cash, and still put their money in banks, when banks are showing that they aren't going to give it back...
Also, how much is silver worth when you need one ounce to build your Nikola Tesla-Otis Flying car?
So true, can't eat crypto or silver. Saving for retirement does require a certain frugality, living below means instead of living in debt. My grandfather was a penny pincher, because he made it a point to pass as much inheritance to the next generation as he could - he owned a farm, lots of land and lots of school busses and did pretty well, but he lived a very plain and simple life.
I don't know if he was uncomfortable with his standard of living. He liked having money more than spending money. As long as the investment doesn't tank, someone at some point will enjoy the wealth. Because I am responsible for a family with six children, I can't save as much as my grandfather who only had one child. But that was a decision I made and do not regret for a moment. I'd like to pass an inheritance to my children, if I can.
Yes, the cash is extracted from the hands of private citizens and put into banks simply by spending it! It's unthinkable that a bank wouldn't give you your money back... although is it really your money after you've surrendered it to a bank? The bank allows access to some of their money, credited by how much you've surrendered to them! But try withdrawing over 10K and see how reluctant they are to give that much of their money away.
The funny thing is that over 50% of silver that comes out of the ground currently goes into electronics. Once electric cars become the thing, it's expected a lot more silver will be needed for the batteries and other components. As the bank vaults have been emptied of silver because of consumer demand, increasingly the only place to find physical silver will be in the hands of private investors. Which means eventually the next level of "surrender" will happen once the industrial silver supply goes critical - surrender your physical metal for digital credits, to "save the planet". It's supposed to feel good to be plundered for a "good cause".
Maybe my inheritance to my children will be a treasure map.
Cash is king, so it is effectively universal in aceptance. However, cash in banks is becoming more and more a bad idea with each passing day.
In the end, money is whatever people decide to accept and use as a medium of exchange. Cash, silver, BTC, cigarettes, postage stamps, beans, etc.
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Whoever owns the warehouses full of cigarettes and wisky will be very rich. I didn't think of postage stamps...
Hey buddy great article, i used to sell Kirby back in the day made some good money too.
Obviously i would choose silver over the machine but they are good machines !LOL
See you have a Kirby Legend II The generation line was what i use to sell we use to take these as trade ins still great machines.
Trade in and finance sells a lot of Kirby
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That's really neat, that you sold Kirby vacuums. It was like watching a modern version of a 1955's vacuum sales pitch. It was a pleasure to participate! Interesting you mention trade in and financing, since I did both!
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Cash is still king, Benjamin
but I agree that it will not be for very long.
!CTP
Yes, right now everyone is hungry for cash. Paper cash just doesn't "clink" the same way silver does. Silver is the real COLD cash.
Great analysis silver has done its job and more than held its value over that time and it's function as money and a store of wealth is confirmed. 👍😎
Yes, in biblical times there was no word for "money", just "silver". Even the world "money" comes from "MENE" which is a weight measurement of gold. The ancients would either laugh or marvel at our paper/digital economy. Probably both.
Very true. It is one thing Peter Schiff is right about too.
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Silver is just similar to Gold. The value is always there, and it's more accessible than other items. It's easy to carry around and not too heavy !
Absolutely.
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One thing I have discovered in silver is it has potential to gain price value much more than gold
Yes, I agree.
You know it!