What would be the value of gold and jewelry in a post-apocalyptic society?

Question

World War VI happened in year 2xxx and the government went AWOL. No federal, state, county government. Chaos and anarchy ensued, and Charles Hestion IX ^[1] felt his ancestor's efforts paid off. Ammo and guns are the most valuable commodity.

Now the dust has settled a bit and some communities are forming, there is one point I am unsure in this society:

What value does gold bullion and jewelry have, when you can barely get enough water and food to survive?

^{[1]: any similarity to a XX century movie actor is mere coincidence.}

Answer 1

Gold and jewelry have a value outside of their "intrinsic worth". Guns and ammunition will be valuable commodities (so long as they work, which might be only a period of decades), but we know that art has a great value as a marker or signifier: The owner is both signifying and displaying their wealth and power because they can afford time and resources for things which are not intrinsically valuable.

A peasant will be spending all their available income on the very necessities of life, food, clothing, shelter and a bit left over for things like tools so they can work the land.

Minor nobility could afford better clothing and shelter, as well as the tools of the trade (normally weapons and armour). As you ascend the ladder of social and economic class, you could afford to spend less and less on the necessities of life, and more and more to demonstrate your position and relative power in life. Since there were various ways to get around class and economic boundaries, there were even laws in the Middle Ages in Europe specifying what could be worn by what classes of people (a peasant who found some coin or managed to capture and sell a warhorse and armour would be fantastically wealthy by the standards of his village, but woe betide him if he were to start buying and wearing fur tried clothes, for example).

Perhaps luckily, most of the time these laws were ignored by the majority of the people, and rarely enforced.

So gold and jewels will still have value in a post apocalyptic society as markers of who has power and status in this new society.

Answer 2

While most "survival" scenarios do place value on gold, silver, and the like, the actual worth of these things greatly depends on the situation. In bare subsistence survival, like everyone is starving to death, only directly useful items are likely to carry much worth. Currency, defined as something that itself is not usable, but has a value assigned to it, can only really exist when there is an authority that places value on it, and, to some extent, determines what that value is. So if there is a guy with a huge storehouse of MREs (and he is the only one in the area) who declares that 1 gold ring or pre-1964 silver quarter is worth 1 MRE, then that value of currency will exist in the local area. So two survivors could trade other things using gold/silver (I'll call them PM, precious metals, now) as currency since there would be a known useful value. But if the MRE guy DOESN'T take PMs, and no one else has a stockpile to initiate a barter system using PMs, then gold/silver will be worthless since it has no direct survival value (outside of some electrical repair work, perhaps).

There needs to be SOME level of society for PMs to have value. Even as ornamentation the basic needs of food, water, and shelter come first. So either there is an elite class that is living above subsistence that determines that gold has value or there is an adjacent civilization that does. This is why PM has value in a POW camp. Prisoners can use it to trade with the guards since guards have access to civilization. If trade was only between prisoners then PM would have little to no worth (versus food, cigarettes, etc).

Given time, when communities have developed, then PM will regain their value. Of course since modern society has flooded the market with jewelry it may not carry the same sense of scarcity as it did in earlier times (unless jewelry stores, department stores, pawn shops, etc have all been destroyed). Gold and silver are uniquely suited for coinage since they don't corrode or rust, are easily worked by primitive technology, and can be distinguished from forgeries/adulteration. But this is only with a pretty high level of society compared to survivors scratching out a living in the rubble. Otherwise value will be in direct labor or trade of items with inherent use/value, like tools, raw materials, food, seeds, etc.

On a side note, I doubt most folks today even know the actual worth of a gold coin, or how to recognize one from a fake. They DEFINITELY don't know the value of pre-1964 silver coinage. I bet the old "gold rolex survival plan" wouldn't even work, as lots of people today wouldn't know the value of a rolex or believe it wasn't a fake. Immediately after a disaster people would take CASH, at least until it became apparent that cash (bills and coins) only had value as firestarter, insulation, weights for your fishing line, or hammered in to arrowheads because the world isn't coming back. In a total collapse scenario PMs and cash have virtually no value.

Answer 3

Gold is a really handy medium for exchange. You can't eat it, build with it, or make primitive tools out of it (you can make complex electronics with it, but by the time you're making complex electronics you've probably moved away from a gold standard anyway). It doesn't tarnish, rot, or spoil, and nearly everyone can agree that it has value.

Guns and ammo are valuable commodities, true, but ammo is also consumable - once you've fired a bullet, you can't re-use it. This makes it a poor medium for exchange. Guns are too big to be used as a form of exchange - if you have two rifles, and I have a gallon of water, you can't give me half a gun to buy the water - it's the whole gun or nothing, and then you only have one rifle. You're not going to be willing to make that trade.

It's historically unclear whether a true barter economy, where goods with utilitarian value were traded for other such goods, has ever really existed. It appears that within groups something akin to communism or socialism existed, where everyone got what they needed and did what they could, while between groups trade took the form of a mutual exchange of gifts. I might gift you with a years supply of water, and you might give me a rifle in return; both of us have gained in the transaction, and we'll be more likely to trust one another next time.

On the other hand, if you have two rifles and ten gold rings, and I have a gallon of water, you can give me two rings for the water and not have lost anything vital. I'll accept the rings, because I know the guy on the next farm has some potatoes, and I know he'll accept gold rings as payment. I also know that if the flesh-eating were-rabbits of Golgotha have snuck in and eaten the farmer before I get there, I can hold onto the gold until I can buy the pretty daughter of the wandering trader who comes through. It won't lose value by tarnishing, and I won't need to shoot it at said were-rabbits; its value is secure.

In the end, any medium of exchange has value because people agree that it does. Gold is perfect for that use. If everyone really is at the subsistence level, and nobody has anything to spare anyway, that is the only time that gold will truly lose all its value.

Answer 4

A lot of answers are avoiding the core question and confusing uses of currency with the value of ostentatious displays of wealth.

What use is Gold and Jewelry?

Gold has a number of qualities that makes it good as a currency:

• It is fungible. You can relatively easily divide it into any fraction you want. This means that you don't have to trade a whole thing for a whole other thing: you can scale the amount you trade according to the perceived value.
• It is durable. While cigarettes, food and other things can and are used as currency, because they have a shelf life that use is limited. Gold has no shelf life.
• It is portable. Relatively small amounts of gold can account for larger amounts of "wealth". It is easier to move a nugget of gold than three goats and a pail. This makes it useful as a "store" of wealth, because the management overhead is low.
• It is homogenous, meaning that all gold looks, tastes and weighs the same as other gold. (This is why animals as currency is difficult: an old cow is different than a young bull.)
• It is recognizable, meaning that it doesn't take a lot of brainpower to verify gold is gold, and conceiving relative amounts isn't hard either.
• It isn't abundant: that is, there is a finite new supply of it. If someone can create or find currency without a lot of labor then inflation undermines agreed value.

Jewelry has some of these qualities but not others (fungibility). In fact, many things express many of these qualities but soft precious metals express the most, and the most strongly.

Now we have established gold makes a good currency.

What use is currency?

And, especially, what use is it in a subsistence environment absent a force-wielding authority government?

Trade seeks to maximize utility: if you have wheat you're not eating and I have goats that are starving it makes sense we trade those in some measure to balance out. That way we both can profit by getting rid of stuff we aren't using in exchange for stuff we can use.

If everyone is engaged in acquiring food, but they are not acquiring enough to feed themselves, then currency is near useless. The total food being produced is less than is needed: trading does not help so tools of trade aren't necessary.

If however some people are producing more than they need, then they will want to trade the excess to people who could do more useful things than farm. The idea here is that the most efficient food producers should produce food, and everyone else should do other things that are needed. In these and more complex scenarios trade and a means of trade are useful.

However, currency is only worthwhile if people generally agree on value. If all cultural understanding of gold has been wiped out through loss of knowledge or simple sparsity of people (such that no trade culture exists), currency and gold is still useless. If this environment exists in your setting then it should be clear if gold or other ideal or near ideal currencies "are useful".

Note that while currency has a primary use in trade, it can be used as a display of wealth and power. Anything can be retasked in this manner: a walking stick can be a weapon or paper money fuel for a fire. Whether that repurposing is effective depends on the environment: ostentatious display of wealth isn't useful if few see it.

Answer 5

You are mixing two concepts:

Wealth, and the ability to use it.

Using jewelry as a form of wealth undoubtedly works. It has been used as currency time and time again, therefore it's pretty simple to deduce that it will be used as currency once more when society collapses.

This brings us to the problem of using wealth. In current times, most people in the middle and lower class of western civilizations can freely use most of their wealth. This hasn't always been true.

If you have lots of money, and someone else has a gun, while you do neither have any ability to defend yourself nor an ability to retaliate, the money still has value, but if you try to buy the gun, the gunman simply takes your money and keeps the gun. Nowadays it's the threat of retaliation by law enforcement as well a societal norms that prevent that. In a post-apocalyptic society you don't have that. Even if a tiny local militia and a court of law exists, there's not much if anything preventing them from taking your stuff.

In order to use your wealth you need social stability and social status that allows you to own, and to trade. Without these that, every form of pure wealth is useless; even dangerous, since it provides a motivation to rob you.

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Example: Say you are a slave, and you find a treasure. The value of treasure is more than enough to buy your freedom. Nobody will dispute that the treasure is wealth, but as soon as you attempt to trade the treasure for your freedom, people will just take the treasure away.

Answer 6

Now the dust has settled a bit and some communities are forming, there is one point I am unsure in this society:

What value does gold bullion and jewelry have, when you can barely get enough water and food to survive?

Your Mileage may vary...

It depends on what your society uses for currency.

Currency is handy because it means removing the middle man from barter and trade, you can get what you want by giving the other person something they want.

It allows someone who does not want the clothes you are selling, to sell you the pig you want without having to get him the pigfeed he wants from the person who actually wants clothes. Instead you simply give him money for the pig, and he uses money to buy pigfeed

What does currency offer?

• Standardized
• Easily traded
• Rare enough to make it impactful
• Common enough to be reasonably useful in an economy of some arbitrary scale

How does this affect my budding society?

To answer your question, you need to answer some questions about your society as it forms. Put yourself in the shoes of someone living in one of these communities and ask yourselves about some of the following...

What situations does currency depend on?

• Agreement of a community at large, to assign some non intrinsic value to something to make it a useable currency.
• A general cooperation among the community to properly assign the same value to equal amounts of the same currency.

Do people in your communities do these things? If so it might be reasonable to form a system of currency for them at some point. In that system gold and metals like it may have a place, though it is not required as some post apocalyptic scenarios value other things.

For example, The fallout video game series shows a society in which soda bottle caps are the valued currency of choice.

While something like gold has some good intrinsic properties, it may only rate being 'worth a glass of water' or a handful of 'bottle caps' if the society has no need of these properties.

Thankfully gold is shiny and easy to show off. It has always been valued as a sign of affluence for this reason and that alone usually has power to make it valuable.

Sounds good, except for...

Before you decide what kind of currency or lack thereof your society works with (or without), you should also answer the following. Note that during the thick of the end of the world, most of the things listed below are likely true. If in these communities they are still largely true, it may make currency a difficult proposition.

When would currency potentially be less valuable as an idea?

• Situations where no one is sharing
• Situations when it is seen as more efficient to take rather than to trade by at least one portion of a society

In conclusion

At the end of the day your people will require a trust in others that when they offer a currency (be it gold, bottle caps, water, cows or rabbits) they can get something they need, like food or ammo. If it is easier for people to use the ammo and steal (it may be for a while at least) then such a system likely will not become widespread until it is more efficient to trade peacefully rather than rob violently.

If you cant reasonably arm yourself with a gold ring and expect it to be generally useful as a bartering tool then it wont be valuable.

Answer 7

Very little, and then a lot

In the immediate aftermath, currency is useless. People need food, water, clothing, medical goods, and weapons to survive. It is unlikely that people will trade away any of their precious goods for anything less than that, unless their are personal needs (such as a survivor desperate to record their experiences trading for a pen and a journal). Anything else is a paperweight.

However, once some level of stability is achieved, a medium of exchange will be necessary. Gold and jewels hold their value well since they don't rust or tarnish, which is why they have been used as a store of value for a long time.

Eventually there will be a need to finance larger ventures than subsistence, such as setting up irrigation, farms, factories for clothing, weapons, medical supplies, and so on. The instrument to build such things would most likely be debt backed by gold collateral, unless Communism makes a major comeback.

Keep the guns and the gold.

Answer 8

"An object is exactly as valuable as people say it is". So most likely, they would be worthless trash. They contribute nothing to your survivability, and it does nothing to demonstrate your power over others. If people BELIEVE that gold and jewelry makes them look 'more powerful', than its value would be proportional to the amount of power it is believed to represent. For example, Purple dye was REALLY hard to make back in the day, so royalty wore it to show off that they COULD. Now Purple is just another color shirts sometimes come in.

Answer 9

Gold is a handy metal. It's conductive, workable by hand or at low temperatures, reflective, and insertable into the body without causing instant infection. Yes, it's also pretty.

So society falls, but we have the stuff. Broken whazit? Use gold! You can melt down some jewelry over a torch and reform it in a whazit part. Useful stuff. Want to impress your woman of the hour? Show off some gold; you can fix anything!

Gold isn't valuable because its rare. Gold is valuable because its rare and awesome!

Answer 10

Here is what happens when you break down the societal structures and such a massive level:

Society will be broken into smaller city-states or tribal communities where the strong (and often unjust) become the dominate political force in each region. There will be a heavy distinction between the working class and the warrior class... and in fact, its very likely there would be what we would consider as slavery (forced occupation with very little pay).

If water and food are precious, it wouldn't matter how much value gold or jewelry would have... people in need with these items would sell a $100,000 item just for a cup of water.

Also consider the fact that old world products may actually be more valuable than gold. For example: medicines, coffee, chocolate, metal and plastic goods, clothes, gasoline, dynamite

Gold and jewelry will not start to have a standardized value until after the society begins to stabilize and the people move beyond basic necessities. You need to have communities that have surplus of food in order to take to market... and other communities that have need of food but have other commodities just as much in demand (like coal, hardwoods, salt, herbs and spices, etc). Only after a period where direct bartering is no longer efficient would currency start to exist.

Answer 11

I would point you towards Diablo 2's economy for an example of "survival" economy before you get to actual economy. In D2 there exists gold that isn't considered valuable by anyone; and then many other things that are somewhat valuable. It's a true bartering economy where things that approach Currency are Runes; which are consumables of a sort. Note: This is the same with Path of Exile; which did away with straight currency altogether and instead has consumable currency.

What this means is that while the currency building functions of combining lower forms into upper forms regulates it's maximum value to a degree, it's not just scarcity driving it's value. It's scarcity + recognition as a useful trading item, as well as being small enough that you can store a lot of it.

If people don't want a rare and good item, because better items exist; it has next to no currency worth, but may be worth your time to use it.

This is to put perspective on visible real economies of games that roughly mirror your survival scenario.

Answer 12

As it has no intrinsic, use based, value gold and jewels are worth what they've always been worth, what people are willing to pay for them. If you have a warlord elite willing to pay top dollar to salvage experts to go get their favourite painting from a museum in Boston (yes I'm stepping on S.M. Stirling's literary toes slightly there) then the work is worth top dollar, or its equivalent, if however the elite are scraping a living as much as the peonage who work for them then if you can't eat it or use it to get something you can eat, if it doesn't keep you safe from the big bad world around you it's useless and thus worthless. So the question of value is really one of how much the world has settled down and what shape it settled down into.

Answer 13

The OP says: What value does gold bullion and jewelry have, when you can barely get enough water and food to survive?

Virtually none. This is the scenario: Your character: A healthy male in his 40s, thin, but you have not had food in two days, and you haven't had water since yesterday. You are exhausted and have nothing stashed. The land is picked over so there is nothing to be found to eat. It hasn't rained in weeks and rainwater is the only thing you trust to be uncontaminated.

You come to a fork in the road, literally, with recruiters offering you two different deals. Presume, for the purpose of focusing this example on the true dilemma, that you can trust both men to keep their word; they will give you what they promise, and you must give them what you promise.

Both men are charged with recruiting a workforce to build, break land, and clear forest for newly formed farming and ranching communities. Neither man will tolerate a changed mind: If you turn them down, you cannot return later to take them up on their offer. The men are friendly with each other, their communities will be sisters. In exchange for an apple from their shared bag, they examine you thoroughly, both wish to make you an offer.

The work is the same hard labor for both: carrying bags of concrete, pulling carts, digging with pick and shovel to clear land, building stone walls. You will work your nearly dead body for 12 hours a day.

On your left is Aaron. He offers you, in return for each hour, all the clean water you can drink, and 500 calories of vegetable and chicken soup (with bread), and 10 minutes to consume them and rest. Every hour, you will work 50 minutes, and for 10 you can eat, rest, eliminate, etc. At night you have 12 hours of shelter (a tent), a community fire, and the companionship of your fellow workers if you want it. Altogether, you get 6000 calories a day, about what you will burn for a hard labor life.

On your right is Bill. He offers you, in return for each 12 hours of work, a gold coin worth, IRL, about \$100. So about \$8.50 an hour, like a low wage job in 2017 America. He will also offer you a tent and community fire, but it is up to you to find and buy your water and food.

Note that IRL, Aaron's deal is not even close to minimum wage. There are 1085 calories in a pound of chicken, which is always available at my grocery store for about $2/lb, so roughly 500 calories per dollar. This means 6000 calories of chicken, IRL, costs about \$12. For 12 hours of work, that is only \$1 per hour.

But this is vegetable chicken soup, and many vegetables cost far less; see This Chart, which is a little out of date but still has the rankings of food by cost per calorie roughly correct.

Many of these foods would not be available in a post-apocalyptic society, but presumably food and grain still grows, and chickens can be fed on peas, corn, beans and insects (e.g. termite farming can provide a good source of protein for chickens, and the chickens will do much of the work once you stir the nest). So let us say that in the end Aaron is offering you the equivalent, IRL, of 42 cents a day, $\frac{1}{20}$ of what Bill is offering you, \$8.50 per day.

Yet most of us take Aaron's deal. There is no guarantee we can buy food or water, Bill is not promising to sell it to us, he offers us only the gold. Our fellow workers, in Bill's camp, don't necessarily have food and water to sell us, and we don't know where we would buy it (except perhaps from Aaron's camp, but workers there don't get to hoard food or water in order to sell it; they consume their pay each hour and that's it).

Here is the major misconception people have about currency, rarity, and "intrinsic value": None of that matters more than trust. If your hungry and thirsty character, the worker above, has no faith that they will be able to trade a gold coin for food and water, then they will not work the first day for a gold coin. A currency does not have to be "rare" to have value, the only demands are that it is difficult to create counterfeit money (a trait that rarity can provide, but see my note on rarity below), and that the holder of the currency is virtually certain they will be able to trade it for goods and services they want: They have faith in the currency.

Note on rarity: The physical rarity of materials (like gold and jewels) is not the only thing that makes an item hard to counterfeit; our own paper money is difficult to counterfeit.

"Difficult to Counterfeit" is really an adjunct to faith and trust in the currency; if it is not difficult to counterfeit, nobody will trust it. If it is subject to wild inflation, or fluctuates too widely in trading value, then nobody will trust it either; meaning they won't believe it is worth, approximately, the same amount of labor it took them to get it.

So in the end, the value of currency is all about whether almost everybody believes it can be exchanged for goods and services. It is not about rarity, or inherent value, or utility. It is about belief.

If nobody in your world believes gold and jewels can be exchanged, quickly and easily, for the food and water in scarce supply, then gold and jewels will not act as currency. They will be worth about what pretty stones and shells are worth. In a post-apocalypse society, the most plausible outcome to me is that tools, weapons, food and sometimes medicine will be far more valuable in trade than gold or jewels.

Answer 14

Any commodity has a use value, which resides in its usefulness, and an exchange value, which is how it relates to other commodities. Currency is a particular kind of commodity in that its use value is to function as means of exchange. So it is exchange value is what gives it a use value, as a reverse to what happens to other commodities, related to which, it is the use value that gives them an exchange value.

Now, means of exchange will only have value if there are exchanges taking place regularly. That's what you must make clear to yourself: to what extent the apolyptic destruction of society that took place in your story background destroyed the possibility of organised exchange, and to what extent the reconstruction that ensued has rebuilt such possibility.

If your post-apocalypse consists in small, isolated communities, then they in all likeness will distribute goods withou the mediation of markets, and will have no need for an internal currency. And if they trade with each others, it is likely that such trade will take the form of barter, in which they will look for use value alone, not for exchange value.

If on the other hand there are organised States, with armies and police, then quite probably such State will mint money *and that money will be made of gold or perhaps silver), or it will enforce the circulation of old pre-apocalytic coins. Fiat money will require much further economic development, probably something like an industrial economy or at least a very developed agriculture with private property of land (such as mediaeval China, for instance).

If you decide that social ties have survived or redeveloped enough to sustain organised trade, then the value of gold should be its exchange value, which is, the amount of labour that it is necessary to obtain it, compared to the amount of labour that is necessary to produce other commodities. In short, the value of the total circulating gold (silver, bronze, platinum, nonobtainium) should be equal to the total value of other commodities, divided by the speed in which it circulates.

Answer 15

In a post apocalyptic world, the survivors would rediscover the drawbacks of the barter society. Thousands of years ago, before civilizations had advanced into full commerce, you had to find someone who had what you wanted, and wanted what you had to trade. That is rarely the case. Your best hope is to trade what you have, for something most people will want.

This is why emerging civilizations thousands of years ago, came up with the concept of currency - a medium of exchange that everyone would accept. Sell what you have for currency, use that currency to buy what you want. Currency was the first great invention of early civilizations. Post apocalyptic societies will also rediscover this handy aid to local commerce.

Early on, societies settled on gold as the first currency. It was one of the first metals that pre-industrial humans could work with. It is a durable metal: not prone to corruption, not needing special storage like grain or bread. It comes in graduated amounts - by weight. Finally, its purity is easily ascertained.

In early societies, traders would carry a touchstone: an abrasive black stone. They would rub genuine gold on it, leaving a colored mark. When someone offered them gold, they would rub that next to the genuine gold, and compare the color. Any impurities in the gold, or fake gold (as in fool's gold), will produce a different color. Being able to ascertain the purity of gold easily was a big advantage, when the purity of other metals was harder to determine.

On top of that, the post apocalypse will be looking forward to the time when civilization resumes, as eventually it will. So there will be a natural tendency to hoard gold, looking forward to the time when its value will increase dramatically.

Diamonds, maybe, but gold, definitely. Some form of currency will be necessary in the post apocalypse, or no one will be able to buy much of anything.