What would you do if the USD or the AUD failed?

[archilles]

Hi everyone,

I'm young, dumb and have recently taken interest in politics and the state of not only our economy but that of the world.


Therefore i'd like to ask this question and would be happy for your suggestions.


If the US/AUS currency became worthless, what would you anticipate would happen , also what would you do to protect yourself in the case it does happen ? ( As tempting as it is to joke about this, serous answers would be appreciated ).


I'd like to hold onto gold and possibly invest in other currencies that are backed by something other than thin air.



Thanks guys

 

[archilles]

No one ever replies to this type of thread, perhaps it's because no one knows what will happen ? it's just dissapointing that no one wants to talk about it because it is a possibility

 

[questionall_42]

Bit of patience there Archilles. Waiting one hour for a response to a topic that has been treaded on many times is a bit presumptious.

Do a search for similar threads.

And check out http://www.chrismartenson.com/crashcourse for a crash course in the economy and financial system. Bloody brilliant presentation.

 

[moXJO]

Not much you can do or more to add then what has already been said. Food supply and safe shelter would be a priorty.And all the little bits to survive. Gold ,Silver but who's to say that will be worth much in times like that. Perhaps a business that would survive through the tough times while buying up the cheap land is the best bet to profit from?
How are the Arab nations holding up?

 

[archilles]

Thanks for that link. and my apologies for being so impatient, call me little chicken if you like.


Does anybody here think/agree this could happen ?

 

[archilles]

Would anyone bail out into another country ?

 

[tech/a]

Its happened before the most recognised one was Germany.
People taking wheelbarrows of money to buy a loaf of bread.
Zimbabwe's now has a 10 billion dollar note!

Basically the currency becomes re valued and you start again.
Those who have property have an asset valued at the going rate which may well be trillions in Zimbabwe's case.
However upon re valuation its then worth X in the currency to anyone who wants it.

Cash of course is only worth what its exchanged at the new rate.
But has the buying power it had before but now everything is pegged at the new rate.

Gold or silver the same. Say gold is 1000$ an ounce and Zimbabwe's currency is 1 trillion /ounce.If you owned gold then you would have the equivelent in the NEW currency which is pegged against the rest of the world.
So youd need a lot of cash.

This is a brief summary to hopefully illustrate what can happen.
Not likley but possible.

 

[archilles]

It's difficult trying to get my head around this.

Why do you think the scenario would be unlikely?


I'm not trying to be smart, i'd just like to know your opinion

 

[Glen48]

Zimbabwe's inflation has hit 2,000 Million % a loaf of bread is now 169,000 Dollars.
All this will keep going down until investors decide things are a good buy and then things will start to turn just like some one has pushed a big reset button.
When house prices get to 1 months rent x 150 you can come out from under the bed unless your Gold crushes you.
then things will take years to get back, it took 27 yrs for shares to get to 1930 levels. 6 yrs from 87 crash. Then in 60 yrs time we will have another depression as we never learn.

 

[Jikx]

It's difficult trying to get my head around this.

Why do you think the scenario would be unlikely?

I think I'll butt in here. I'm also quite young, but maybe we'll think on the same level lol

The AUD/USD will most likely never "fail", as a failure of a currency basically means it is worthless, and unable to be used in exchange of goods and services. How do you make a currency worthless? As others have stated, take a look at Zimbabwe. A true basket case, they print so much money that it's barely worth more than the paper it's printed on (hyper-inflation). That currency has failed.

I find it highly unlikely that the printing presses will ever dish out such a vast amount of dough in Western countries simply because we know what will happen - utter destruction of our economy.

What some commentators are concerned about is deflation, or an exteme case, depression. In this case, it's almost the opposite of what you're looking for. If it were ever to happen, the AUD would not fail (as in be worthless), but actually be worth a lot more!

So if you're scared now, thinking a depression will come, horde cash or precious metals (gold/silver). Unforuntately, that very thinking spread across the whole population could cause a depression in itself.

 

[archilles]

I'm just scared that when we have to ' reset ' - our investments as we knew, will never be the same. I'm trying to prepare for the worst and have a plan to carry me through in case things turn ugly. Having said that i'm not a total pessimist, i do believe amonsgt this mess we can find good opportunity too.