BarterTo trade by exchange of com­modi­ties rather than by the use of mon­ey. (Source: Source loca­tion: Ran­dom House, inc.)

Much has been writ­ten about the use of barter in a post SHTF/TEOTWAWKI. event. Even in “mere­ly” a post-finan­cial collapse/SHTF event barter is pre­sumed to be the norm for con­duct­ing com­mon trans­ac­tions, espe­cial­ly at the begin­ning of the event (see Chile 1982, Argenti­na 2001 – though it is inter­est­ing to note that Far­fel claims barter nev­er real­ly took off as most peo­ple expect­ed would hap­pen).

But none of these dis­cus­sions describe the true dif­fi­cul­ties of using barter for obtain­ing dai­ly com­mon sup­plies and needs.

Most peo­ple think barter is mere­ly “I’ll trade you this for that.” In a pure, sim­ple sense that is so. How­ev­er, where the rub­ber meets the road, where the­o­ry smacks hard into the face of real­i­ty, it isn’t near­ly that sim­ple and easy. “Barter” is plain­ly not the same thing as “mon­ey”.

Like it or not, good or bad, “mon­ey” (as in paper cur­ren­cy, includ­ing credit/debit cards) as we have come to know it is an effec­tive means of exchange. We exchange mon­ey for the prod­uct and ser­vices we want. The rea­son “mon­ey” is so effec­tive is because it is gener­ic. The cur­ren­cy we receive (or pay out) in exchange for prod­ucts and ser­vices can be used to obtain what­ev­er oth­er prod­ucts and ser­vices we want, when we want them (all oth­er things being equal). We do not need to know exact­ly what we are going to use the mon­ey for when we receive it. We can exchange that mon­ey for food or cloth­ing or med­i­cine or fuel or trans­porta­tion or enter­tain­ment, or sim­ply hold on to it (save) for anoth­er day. “Mon­ey” doesn’t get stale or expire or sim­ply go bad after some peri­od of time (ignor­ing infla­tion and deval­u­a­tion for the moment).

By con­trast how­ev­er, when you are con­sid­er­ing a barter exchange then you must con­sid­er at that exact moment what it is you rea­son­able expect to do with what­ev­er item(s) you are receiv­ing in the exchange. It is high­ly risky to accept an item whose use­ful­ness to you isn’t clear.

This has obvi­ous draw backs.

You may not need an item today but need it tomor­row and now the oppor­tu­ni­ty to acquire it is gone.
You may take an item in exchange think­ing it will use­ful but turns out it isn’t.
You may take the greater risk of accept­ing an item in exchange hope to re-exchange it lat­er for some­thing else but that doesn’t pan out either.

For exam­ple, on many web sites and blogs it is fre­quent­ly stat­ed that .22 ammu­ni­tion will be the “new cur­ren­cy” in a post SHTF envi­ron­ment. To me, .22 ammo is only good if I have a .22 firearm. If I do not, I either do not accept the exchange, or, have to take on the addi­tion­al risk that by accept­ing it I can re-barter it lat­er for some­thing else I do need.

Anoth­er exam­ple: Con­sid­er a post-nat­ur­al dis­as­ter sce­nario like Kat­ri­na. Sup­pose some­one comes to you with a brand new big screen TV want­i­ng to trade it for food. In more nor­mal times the TV has val­ue because you can use it right away. But after a dis­as­ter it might be weeks or even months before pow­er and cable is restored to your area so what good is a big screen TV?

And that leads to the issue of: What exact­ly to store as barter items?

The answer is sim­ple: It large­ly doesn’t mat­ter.

There is no real way of know what exact­ly will be of exchange­able val­ue in a post-SHTF sce­nario. Some items prob­a­bly will always have a lev­el of demand such as food, water, med­ical, defens­es, fuel, etc. But those would like­ly be the last things you want to trade way instead of keep­ing for your own use.

Web­sites and videos are full of sug­ges­tions for this or that  to accu­mu­late for barter such as tobac­co, alco­hol, ammu­ni­tion, salt and sug­ar, bat­ter­ies, can­dles, nee­dles and thread, even tooth brush­es and den­tal floss!  In one video I recent­ly saw the guy claimed to have over 50,000 (yes!) nails of all kinds stored for both his own build­ing use and for barter. On anoth­er web­site it was post­ed that some­one had stored so much TP in antic­i­pa­tion of Y2K prob­lems that it took sev­er­al years after Y2K to use it all up! Imag­ine the stor­age space need for all that!

There is also geog­ra­phy to be con­sid­ered. Some items may have greater val­ue to peo­ple in urban areas while peo­ple in rur­al areas put greater val­ue on dif­fer­ent items. Some­one in a more North­ern loca­tion for exam­ple may val­ue warm clothes more than some­one in Flori­da.

The real­i­ty is you sim­ply can­not turn your home and pantry into an exten­sion of Wal­Mart. There sim­ply isn’t the mon­ey and space to allow that. If you are going to col­lect items with the inten­tion of using them for barter be sure they are things you can use your­self in your own life should the exchange val­ue not be as sig­nif­i­cant as you imag­ined pre-SHTF (not to men­tion if a SHTF event nev­er occurs at all).

Barter exchange has been around since the start of human­i­ty. There is no rea­son to think that would change. But bar­ter­ing for prod­ucts and ser­vices is far dif­fer­ent from our present cur­ren­cy exchange sys­tems that requires a very dif­fer­ent under­stand­ing of how mar­kets work in order to be suc­cess­ful. It should not be thought of as just the same as using dol­lars or oth­er paper cur­ren­cy.

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