Asset Protection? Silver Has Held Its Value For 23 Centuries

Tyler Durden's picture

Submitted by Simon Black via SovereignMan.com,

Thousands of years ago in ancient city of Babylon, specially trained scribes gathered each day in the Temple of Marduk to record the day’s events.

They used cuneiform writing instruments and clay tablets, over 1200 of which still survive today.

These scribes kept excellent records, detailing astronomical observances and water levels of the Euphrates River, as well as market prices for the most popular commodities like wheat, barley, and wool.

It’s incredible that we have detailed records of grain prices going back thousands of years.

The ancient Babylonians quoted grain prices in shekels, a unit of weight equivalent to 8.33 grams of silver.

Over the 3+ century period between 384 BC and 60 BC, for example, the price of barley averaged 0.02053 shekels per quart in Babylonia.

At 8.33 grams per shekel, this would be equivalent to about 0.171 grams of silver per quart, or about $3.75 based on today’s silver price.

After converting the unit of measurement from ancient quart to modern hundredweight (cwt), that means that barley in Babylonian times sold for $5.23 per cwt when priced in today’s dollars.

And according to the US Department of Agriculture, yesterday’s price for barley was… $5.25 per cwt.

Amazing. When denominated in silver, the price of barley is almost exactly the same as it was thousands of years ago.

In other words, if a farmer from 23 centuries ago had sold a quart of barley, he would have received 0.171 grams of silver.

Fast forward to today and that 0.171 grams of silver would buy almost the exact same amount of grain as it did 23 centuries ago.

This is an important reminder, especially today as the entire financial system waits with bated breath to see if the US Federal Reserve will raise interest rates for the first time in nearly a decade.

It’s ultimately a complete farce. Our entire financial system is based on awarding total control of our money to a tiny, unelected committee of bureaucrats.

They have the power to conjure trillions of dollars, euros, yen, pounds, renminbi, etc. out of thin air that are backed by absolutely nothing other than a thin veneer of confidence.

Civilizations have been experimenting with this model for thousands of years. And every single time it has failed.

Future historians will certainly wonder why we chose a financial system based on a model with such a long history of failure, and why we gave control of our savings and economic activity to unelected bureaucrats who are consistently wrong.

When you step back and look at the big picture, this system is totally mad. And full of risk.

Governments are insolvent. Central banks are nearly insolvent. Banking systems are extremely illiquid. National pension funds are insolvent.

And their solution is to keep borrowing and printing more money.

Look, holding some physical cash does make sense right now as a *short-term* hedge against risks in the financial system.

If the GFC 2.0 hits, you’ll be glad that you’re holding some physical cash (more on this soon).

But how much do you think your paper currency will be worth 23 centuries from now? Or even 23 years? Or potentially even 23 months?

Bottom line– you’re not protected unless you own some real assets. Gold. Silver. Land. Productive business. This should be part of any rational person’s Plan B.

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Dog Will Hunt's picture

Best protection available against the bloodsucking werewolf bastards of Wall Street.  

SILVERGEDDON's picture

Silver mining has dwindled to incidental recovery as a by product of copper, nickel, and lead mining - pure silver mines were played out for the most part over one hundred plus years ago.
Down turn of economy will not deter the most significant modern day usage of consumer electronics - the smart phone. Silver is the most efficient conductor of electricity on a unit cost basis.
Economic recovery of silver in consumer electronics is not feasible, even in China. Economic recovery of silver used in most other modern day applications of silver is not feasible either.
The ten percenters will never stop wanting new consumer electronics, and they survive down turns to the economy just fine it seems.
Add in the newer industrial uses of silver that also shrug off economic issues out of necessity - medical wound dressings, water purification filters, etc., and you have a continuing demand for a metal whose annual production has been falling for decades.
So, you have an indispensable metal being consumed by industrial use constantly, declining in mining production, and under supply pressure to serve both the industrial and monetary silver markets.
Take away the paper manipulation of 2 - 300 times the available physical silver available in the market, and there's a problem with price discovery for the real deal versus fantasy paper silver that never existed.
Lastly, the uncertainty of a major economic event always moves people to seek out safe haven for their hard earned money. Fiat currency has a history of failure for thousands of years, a near perfect track record of failure.
Silver and gold have a five thousand year history of recognized value in times of uncertainty, more so than any other commodity you can name that is portable, incorruptible, stable, and internationally recognized.
To summarize, with silver spot trading for substantially less than the cost of production, I see no down side to investing in it as a safe haven.
If the whole world burns, silver will be a recognized form of currency far easier to trade with than anything else short of 22 LR ammo.
I would rather dance with the silver devil than take on Wall Street, Goldman Sacks Biters, JP Morgan Chase, banks, politicians, the Fed, the CIA, NSA, DHS, IRS, and all of the other thieves on the loose out there.

BUY THE FUCKING DIPS, bitchez.

OldPhart's picture

There is still plenty of silver in the Calico Hills, it's just not worth enough to dig it out.

https://www.youtube.com/watch?v=8BfhP2kSpNI

 

nope-1004's picture

Exactly.  Declining ore grades are the # 1 reason I bought some years ago.  Nature always has a way of bringing need vs availability back into balance.

The big bank price manipulation is icing on the cake for me AFAIC, as that will only lead to a panic and explosion eventually.

Pladizow's picture

More metals bug propoganda! Why would any intelligent person care what any asset class does over thousands of years? At most, perhaps 45 years!

nope-1004's picture

Because the other side of the 'corrupt government' trade is physical gold and silver, which are the only instruments that carry no counter party risk and are recognized and accepted globally.

The USD.... in the future, not so much.  How about AAPL?  Will either of those last 23 centuries?  lol

 

chumbawamba's picture

Simon's math is complete shite.

At 8.33 grams per shekel, this would be equivalent to about 0.171 grams of silver per quart, or about $3.75 based on today’s silver price.

0.171g / 31.1g/ozt * $14.10/ozt = ~8 cents.

Unless he just recycled an article from 2011 when silver peaked at $50/ozt?

I am Chumbawamba.

greenskeeper carl's picture

this article is also stupid if you believe that silver is massively undervalued compared to the dollar, the S&P, bonds, etc. Silver is underpriced, a lot.

PrezTrump's picture

if the author had not decided to cut off stocks from consideration (i bet reasoning goes: stocks are not 23 centuries old)  

then he/she/they would have discovered they might as well have been doing as the muppets do...

0b1knob's picture

"In the long run we are all dead."   Some guy who is now ironically dead.

Tall Tom's picture

You do not belong here on a Financial website as you are both illiterate and innumerate.

 

Go back to DrudgeReport and get off of my porch.

Tall Tom's picture

READ MY ANALYSIS BELOW INNUMERATE MAN.

Conax's picture

It's even worse than that, If .171 gm = $3.75, he's talking about $682 an oz Ag here.

Turrible math.

Tall Tom's picture

Yes. You are one innumerate man.

 

READ BELOW.

Conax's picture

Look, the story said .171 grams of silver is $3.75 at today's price, which is wrong.

.171 gazinta 31.1  182 times.  182 times $3.75 is really high priced silver, man.

On my calculator.

PrezTrump's picture

grams of silver per quart

thats a measure of silver in water...

he said grams period.

just sayin

Tall Tom's picture

You did not understand the article at all.

 

The unit of Silver used was the Babylonian Shekel. It was the MONEY at the time.

 

And food, as Barley, even today, is packaged and sold by VOLUME at times. A quart is a measure of VOLUME.

 

Are you that illiterate and ignorant?

Tall Tom's picture

Chumba...

 

It is not his math but he did not provide all of the necessary information needed for the proper calculation..

 

He wrote, and I quote,

 

The ancient Babylonians quoted grain prices in shekels, a unit of weight equivalent to 8.33 grams of silver.

Over the 3+ century period between 384 BC and 60 BC, for example, the price of barley averaged 0.02053 shekels per quart in Babylonia.

At 8.33 grams per shekel, this would be equivalent to about 0.171 grams of silver per quart, or about $3.75 based on today’s silver price.

After converting the unit of measurement from ancient quart to modern hundredweight (cwt), that means that barley in Babylonian times sold for $5.23 per cwt when priced in today’s dollars.

And according to the US Department of Agriculture, yesterday’s price for barley was… $5.25 per cwt.

After converting the unit of measurement from ancient quart to modern hundredweight (cwt), that means that barley in Babylonian times sold for $5.23 per cwt when priced in today’s dollars.

 

Okay...Let's start the analysis correctly...

 

(0.02053 Shekels/quart Babylonian)(8.33 gms Ag/Shekel) = 0.171 gms Ag/quart Babylonian

 

This means that

 

1 quart Babylonian = 0.171 gms Ag

 

So we are in agreement here to this point.

 

However Barley, today, is not sold in quart Babylonian. It is sold in cwt.

 

Well 1 cwt = 100 lbs. 

 

Currently that price, from the article, is $5.25/100 lbs.

 

So the question is how much does the volume of a Babylonian Quart, OF BARLEY, weigh? 

 

Well using this handy tool found here...

 

http://www.aqua-calc.com/calculate/volume-to-weight

 

Barley has a weight of 0.6 gms/cm3.

 

So how much VOLUME is in one Babylonian Quart?

 

From

 

http://www.britannica.com/science/measurement-system

 

we can find that the Babylonian Quart was about 99 to 102 millilitres. However I will write as 99 cm3 to 102 cm3. knowing that one Milliliter is equal to One CC or One cm3.

 

And 100 lbs = 45.3692 kilograms.

 

Now we finally have enough information for the proper calculation.

 

(0.6 gms Barley/cm3)(99 cm3 Barley/quart Babylonian) = 59.4 gms Barley/quart Babylonian

 

Thus...

 

(59.4 gms Barley/quart Babylonian)(1 quart Babylonian/0.171 gms Ag) = 347.37 gms Barley/gms Ag

 

So 1 gram of Silver would buy 347.37 gms of Barley back in Ancient Babylon

 

So with that...

 

(347.37 gms Barley/gms Ag)(31.103 gms Ag/ozt Ag) = 10,804.25 gms Barley/ozt Ag

 

or

 

10.804 kg Barley/ozt Ag

 

knowing that there are 1000 gms per kilogram.

 

Using that figure yelds...

 

(10.804 kg Barley/ozt Ag)(100 lbs/45.3692 kg)(1 cwt/100 lbs) = 2.381 cwt Barley/ozt Ag)

 

Well that means that One Troy Ounce of Silver would buy 2.381 cwt of Barley in Ancient Babylon had cwts existed as a unit of measurement.

 

If that is the case then what does ONE CWT of Barley cost in terms of Ag?

 

Easy. It is the inverse.

 

.0.4199 ozt of Silver buys a CWT of Barley in Ancient Babylon.

 

And if we were to multiply that number by the price of a Troy Ounce of Silver in today's FUCKED UP FIAT US PIECE OF SHIT DOLLARS???

 

(0.4199 ozt Ag/CWT Barley)($13.75/ozt Ag) = $5.77/CWT Barley

 

Now perhaps he used the 102 cm3 figure. And if I did then I can Multiply my answer by 99 and divide it by 102 and come up with $5.60.

 

Perhaps I do not know exactly what figures that he used as he did not provide all of the relevant information.(He does not have to. It is not a formal thesis after all.)

 

BUT I DO KNOW THAT HE IS IN THE BALLPARK...and as for you?

 

You are nowhere near.

 

You FAILED to understand that you did not have all of the necessary information.

Then you FAILED to do the necessary RESEARCH....because of your INTELLECTUAL LAZINESS.

 

And then you claim that he is wrong without having anything to substantiate it?

 

Science Dammit.

 

You people are Allah ackhbar-ing innumerate.

 

This is shit that you are supposed to learn...IN GRAMMAR SCHOOL and HIGH SCHOOL at the latest.

 

 

OldPhart's picture

I think math was one of the first things dumbed down in the curriculum back in the late 80's/early 90's.  High school geometry used to teach two column proofs using definitions, theorums and postulates, leading to a conclusion.  Now, I understand it's a standard to write some sort of half assed paragraph to come to a conclusion.  And since English and vocabulary were the combined second/third skill reduction, that paragraph has got to be a doozey these days.

I was too lazy to go through the efforts you did.  I looked at the numbers and mentally they were pretty close, +/- 10% or so (with some slack for windage).

But kudos, I believe you come from an even earlier epoch than I, who suffered the great dumbing of the sixties.

Tall Tom's picture

I am a product of the Califormia Public School System in the the late 1960s and early 1970s.

 

However I went to Private School for High School as I was afflicted with Cerebral Palsy and Santana High booted me because they could not protect me from the bullying.

 

We still had some good schools back then.

OldPhart's picture

I'll be damned, our football teams played each other.  Class o'77.

Rakshas's picture

Tall Tom ........ that was epic and very much appreciated - providing both a chuckle and a reminder of how mentally lazy we seem to have become ...... I wish my sons teachers were so detailed in thier analysis  

PrezTrump's picture

who cares.. u gonna live 23 centuries?

Tall Tom's picture

Yes. I will live eternally.

 

But since you are writing of the practical, and making that statement, it seems that you have missed the point.

 

Like it or not this economy is failing. The US Dollar is losing the World Reserve Currency status that you have enjoyed.

 

It is apparent that we are in an extreme deflationary environment. Monetary Velocity is currently NEGATIVE.

 

However when Market Corrections happen it is a historical fact that the correction overshoots to the other side and that usually happens rapidly.

 

If a market is oversold for an extended length of time then it usually corrects to the overbought side rapidly. It is called a WHIPSAW.

 

The deflationary environement will probably overcorrect into a inflationary environment rapidly. If we experience a HYPERDEFLATION then we will get a HYPERINFLATION before any normalty is restored.

 

I do not know why you are here. You do not seem to even know the basics about the dynamics of the Marketplace and you are posting on a Financial Website. Many people here do not.

 

Gold and Silver Ownership are an Insurance Policy for periods of Financial instability. We have been in that storm for quite awhile.

 

Gold is more basic and Silver is more volatile and is a little speculative.

 

Personally I am enjoying the low prices. I am a BUYER. I like buying low. I am only into higher prices if I seek to sell.

 

And I really do not care about what you do or if you survive the oncoming storm.

 

If you have ears to hear, then hear. If you have eyes to see then see. And if you are both blind and deaf then you will succumb as the game goes to the swift and nimble.

 

And that is YOUR PROBLEM and not mine.

lunaticfringe's picture

That's a lot of work to split a few hairs. The salient point is that PM or silver in this case, holds the same value over a great span of time. I get that without all of the math bullshit.

You might do well to find a little humility and a little less arrogance, Tom. If you need an example of this, pls re-read your comment above.

Tall Tom's picture

The price of Goods is both measurable and QUANTIFIABLE.

 

A Standard of Weights and Measures IS REQUIRED for any understanding of Financial or Economic analysis as that is how commodiries are traded.

 

Oh I realize that you may understand the point.

 

But when others do not, or, resort to utter BULLSHIT in a vain attempt to split hairs, then I will shred them apart. Theit analysis was BULLSHIT and then they attempt to IMPEADH THE CREDIBILITY OF THE AUTHOR by spreading that filth of misinformation.

 

And it is the EPITOME OF ARROGANCE to think that my analysis was for your benefit. It is NOT ALL ANOUT YOU.

 

Yes you may inderstand the point...

 

But for those who will believe that BULLSHIT written in order to unfairly impeach the author...That is my target audience.

 

NOT YOU.

LocalBoy's picture

People who care about posterity lack intelligence
People who care about short term, 45 years, prosperity are intelligent/

Just and sustainable lacks intelligence........

Good Grief 

oddjob's picture

Leave it to your kind to try and make recorded history illegal knowledge.

El Oregonian's picture

Oh Plad... Momma Yellen's calling, time to come inside.

Mentaliusanything's picture

What worries me more is if some ancient farmer was able to get $5.24 / CWT then with modern mechanized farming and fertilizers we are getting the same per CWT in Silver..... Well some margin taking middle man is making a killing today.

Goldman????

tmosley's picture

"When denominated in silver, the price of barley is almost exactly the same as it was thousands of years ago."

That is interesting. Both production of silver and grain have been heavily mechanized, and as such have remained at about the same value relative to each other.  I daresay that the prices of each in terms of human labor have fallen drastically.

Tall Tom's picture

Correct. We have a much higher standard of living at the present. But that too shall pass.

zippedydoodah's picture

"Silver is the most efficient conductor of electricity on a unit cost basis."

I think you're talking shit. Silver is only 5% better as a conductor than copper and the cost difference is huge. Wikipedia  entry for Electrical_conductor states:

"Silver is more 'conductive' than copper, but due to cost it is not practical in most cases. However, it is used in specialized equipment, such as satellites, and as a thin plating to mitigate skin effect losses at high frequencies.

Tall Tom's picture

He cut and pasted his post from this

 

http://www.zerohedge.com/news/2015-11-19/physical-sales-surge-paper-pric...

 

He was comparing Silver against that of Gold in that initial post. He is correct that Silver is a better conductor than Gold and much less expensive than Gold.

 

He failed to edit his previous post before posting it here.

 

Other than that mistake his information is accurate...

detached.amusement's picture

Where quality is concerned, accept no substitues - I recapped my old mixing board a little while back, and for damn sure I went through an ounce and a half of silver solder.   Gold for external connections and silver for internal.

sam i am's picture

Did they make beer from barley then?

 

That would be the most profitable trade in regards to barley, and that's why barley keeps its price well for 23 century.

 


Quasi's picture

Indeed.  It is nearly worthless to compare commodity X to commodity Y and then proclaim "the value of commodity Y has stayed the same!".  Shouldn't we be looking at other commodities from Babylon for a real analysis about the value of silver? What about chariots? Or Babylonian real estate? I'm willing to bet a a few pounds of silver buys WAY more real estate in modern Iraq than ancient Babylon.

Squid-puppets a-go-go's picture

indeed, barley isnt the near-ubiquitous staple it was back then, and silver is (defacto) demonetarised - tho that is balanced by industrial application demand

Anopheles's picture

The relative value of silver in ancient history was hundreds of times more than today.   You statement is correct, relative values of a cherry picked commodity is useless.

Essentially, the relative value of silver is about 1/100th to 1/200th of what it was 1000 to 2000 years ago.  Silver HASN'T kept it's value throughout history as the bugs like to profess.   

One example is that 700 years ago, the annual wages for a labourer was about 2 pounds of silver a YEAR.  

Who today is going to work for 2 pounds of silver a year?              14.5*2*$14  =   $406

Yet multiply that by 100 to 200 and the numbers are in the right range. 

Tall Tom's picture

We have a higher standard of living presently.

 

That will not last for much longer.

 

The USA is headed toward total destitution and 3rd World Status.

 

People in Timor-Leste live on $400 PER YEAR.

 

http://www.nationsonline.org/oneworld/GNI_PPP_of_countries.htm

 

Yes it can be much, much worse.

 

You can bet that it will be.

BurningFuld's picture

I think putting Hops in Beer is one of the worlds great inventions.  I do.

Realname's picture

Reinheitsgebot...The German Beer Purity Law... https://en.wikipedia.org/wiki/Reinheitsgebot  The homebrewers out there know about these things. Cheers!

Rock On Roger's picture

The gods likely brewed beer long before they started breeding humans.

http://www.ancient.eu/article/222/

 

Ninkasi, goddess of beer, daughter of Enki.

detached.amusement's picture

  interesting, the stories of enki and enlil

 

but if you believe  those then you have to pitch the bible! 

Miss Expectations's picture

Who measures barley in quarts unless they're talking about beer?

J S Bach's picture

Bah, Humbug.  It's a useless relic!  Oh wait, that's gold.  Silver has some actual uses in industry, so I guess that makes it worth something.

Stainless Steel Rat's picture
Stainless Steel Rat (not verified) J S Bach Dec 16, 2015 8:58 PM

It is consumable, so it is manipulated to keep silver consuming businesses profitable.

Supafly's picture

But the ebb and flo' will make you po'. 

OldPhart's picture

Bought a pound of Silver Eagles on Friday.  Should be getting them in the mail tomorrow or the next day.