Friday, September 21, 2018

South Africa and platinum

Dear Fernando,
First off, I'm an avid reader of your blog and would like to thank you for all the advice and information that you've posted over the years. I've finally decided to start buying precious metals, namely platinum. How do you think the situation in South Africa will impact platinum prices, especially if it devolves into civil war?
South Africa produces 80% of the world’s platinum, so I understand what you mean.
A couple points to keep in mind though. Unless South Africa goes 100% complete stupid (which yes, it could) they will keep production going. Dictators have a way of saying one thing and doing another, especially when there’s money to be made. All words and populist speeches aside, I believe they will keep “business as usual”, that the people wont see a cent of it, but that’s another story.

Second, the traditional currency has always been gold and silver. These are the ones you are more likely to come across, the ones people know best, know how to detect fakes, more widely acceptable and at more reasonable premiums on the street. You’ll have a hard time convincing average Joe on some small town shop or market about the real value of your platinum when he’s mostly used to move around gold and silver.

I see that there could be a scenario where, due to unrest in SA, production of platinum suffers and the prices go up. Anyone that wants to put some chips there and see how the dices roll I understand.

I’m not sure if that compensates for the lack of familiarity compared to gold and silver though. At least for the average modern survivalist that wants to have a good old reliable precious metals in case of a strong devaluation of fiat currencies.


Fernando “FerFAL” Aguirre is the author of “The Modern Survival Manual: Surviving the Economic Collapse” and “Bugging Out and Relocating: When Staying is not an Option”

1 comment:

JC said...

As Platinum is still needed for catalytic converters, with a guaranteed market, there will be platinum produced. Likely by Lao Gai/gulag/slave labor.