[UltraViciousBudgie]

If (or when) faith in the dollar and other fiat currency is lost gold and silver coins would certainly be prized, though to be useful for exchange most of it would need to be minted into smaller sizes. Maybe the smallest coin would be something similar to the tiny silver 3 cent piece from the 1800s or even a larger solid copper coin.

However there isn't enough to go around. So would there be a return to local and regional private money like for example happened in the U.S. during the 18th and 19th centuries? Due to currency shortages local banks, companies, and even general stores issued tokens and paper "money."

I imagine such private money would have to be pegged to the price of gold and/or silver to be acceptable to a fiat-weary populace. There would be a lot of downsides such as exchanging store A's tokens for bank B's or if said store or bank goes bust.

[Cloud9]

Beer, beans and bullets make pretty good barter items.

[Rod_Cloutier]

If things start getting really bad, I plan to buy as many plastic storage containers that I can to stock up on tradeable foodstocks. One pound bags of flour and sugar will be worth more than gold or silver coins in the event of a collapse, both as a reserve foodsource for the family and as a means of exchange.

I'm sure many other people are thinking the same thing- so a run on basic foodstuffs will almost certainly be the 'bellweather' signal that collapse is taking place.

[kpeavey]

Coinage needs to be standardized. Its too easy to shave just a little of the metal off the edge of the coin, save it up and pound out another coin similar to the first. In no time all the coins are scratched and clawed up to the point they are difficult to recognize. You are also correct about there not being enough to go around.

Beer, Beans, Bullets, and Barter are excellent approximations of how trade can progress. Tangible, useful products with an inherent value in the eye of the receiver are the articles by which deals are made.

Back in the day, individual banks would issue notes. With modern printing equipment, paper money is in danger of counterfeiting all the time. Individual bank notes are probably a thing of the past forever. Paper exchange instruments are probably also a thing of the past forever on a regional or national scale.

On a local scale, a small time operator could come up with a local currency/medium of exchange for use among people known to him. Farmer Ted signs his name on a piece of paper promising 5 pounds of potatoes to his neighbor Jack. Jack can trade that piece of paper with his buddy Joe for some rope. Joe gets potates from Ted. In a case of a closely knit community, this can work to some degree. When the carpetbaggers show up and start printing up Ted Money, theres going to be a pounding.

[ki11ercane]

An article I read a LONG time ago on the the subject.

Today there are over 2500 local currencies in the world. Problem with the U.S. and Canada is technically de-coupling your local currency from the federal mandated one is illegal. (ie. Libery Dollars raid)

Even barter here in Manitoba (physical goods/services for physical goods/services) HAS to be declared in "dollars" on ledgers in order for the provincial government to get it's provincial sales tax. (and I am sure it's the same all over the place in Canada) The problem is the province will only take "dollars," not "physical goods" (other than seizing your physical assets) that you have bartered for taxes. Same goes for services. If you owe $100.00 in PST generated by barter, you cannot offer the government "service" to repay it. When I told my father this (as he does some barter of service for service) he thought I was full of shart until I pointed it out to him in the taxation manual.

The system has to collapse first for it to evolve. It simply won't evolve with citizenry "best intentions." Your best intentions will get you arrested.

[Kristen]

An interesting item you could also exchange would be medication. Surely for the sick, if you had antibiotics in your possession, you could trade them for food and other supplies. There's a million pills out there for every conceptual disease it seems.

Also booze and cigarettes would be good trade items. Everybody loves those and you could get some tangible goods out of them as long as you're not a smoker and alcoholic.

[ReverseEngineer]

The problem of counterfeit currency and debasement of metals used in coinage has existed as long as money has existed.

Gold as a form of direct currency became unusable once the population using the gold surpassed the number reasonable to divide up the gold into a reasonable size coin. Silver, somewhat more in physical supply substituted, but of course silver couldn't be distributed around either and so coinage in the US started using nickel instead.

For anyone hoarding gold coins or silver slips as a projected means of future tender, until the population drops off seriously, it just won't work for buying food.

Paper Dollars actually at the moment would hold the most security. To combat the Counterfeiting problem, the US MInt has for years pursued ever more intricate methods of making this piece of paper difficult to counterfeit. Paper dollars also represent only a small fraction of dollars in the money supply, so even if the rest of the system goes blooey, for a while at least paper dollars might function to buy you something.

Projecting into the future, I would agree that any new currency system would first be based on direct barter, only later to be followed by some sort of private Promisory Notes that might be honored locally as tender once some trust was reestablished. This kind of system could only work very locally however, which is one of the reasons I favor small community sizes no larger than around 10,000 human souls. For trade on the grand scale, its direct barter again. We ship a tanker full of oil down to WA, at the dock its traded directly for a container ship full of food. Forget the Letters of Credit.

Of course, there can be corruption and theft at the docks, as there has always been. Always wise to accompany your Cargo Ship with a Frigate and some Cannon to bombard the port if they try to cheat you Or an Aircraft Carrier with some Supersonic Jets, long as you can keep them running.

Reverse Engineer