@Polygeekery said in Immediate impact of a default?:
@Jaime said in Immediate impact of a default?:
Physical things and labor will continue to be valuable
Yes. Generally speaking markets revert to barter.
@Jaime said in Immediate impact of a default?:
which is why the doom-sayers suggest you buy gold.
They're idiots. Sort of. I've heard the argument that you should buy gold because it is the only thing that would retain its value in times of.......whatever. This is technically true but effectively meaningless. In times of unrest and collapse gold won't buy shit because it has no utility. You would be better served to stockpile bottled water, packaged food, medications, tools, guns, etc. Things that have utility and value if currency becomes useless. At least you could use those things or trade them for things that you need.
The "doom-sayers" I've read on this topic aren't looking at it as an alternative means to purchase goods, but exactly what you mention below, as an alternative investment to the relatively volatile and uncertain stocks and bonds market, and as a stopgap alternative to stuffing money under the mattress or getting a CD.
Regarding gold as a commodity, there is one thing that's different today vs centuries ago: Gold has a greater value in manufacturing and technology. If people start hording gold in any significant impact, it may not only make its value greater, but also increase prices on circuit boards and other goods that use gold in its manufacturing process.
Finally, after skimming the thread, I didn't see this being mentioned, but apologies if it was brought up already: It's important to note that merely rejecting the budget and not raising the debt ceiling in and of itself will not make the US default. It is a step towards that, but it by itself will not cause the doomsday scenario laid out (although it will have significant impacts on the economy). We've gone through this same thing a few times in the last few decades, some of which had lasted a few weeks before a compromise was made prior to us driving off the cliff.
Politics has been increasingly polarized, but I still have hope that the politicians don't chop their own heads off to spite their body. If the two sides are stubborn enough to refuse any sort of compromise and get us into a default, nobody's political career will survive before their next term. Either side will point fingers blaming the other for getting us into the hypothetical clusterfuck, but I think the public is going to just say "fuck everybody there" and start some sort of revolution that makes both parties obsolete.
And that's all I'll say before I get into territory.