What’s a Dime Worth? Bartering with Junk Silver
by H. North, Survival Blog “Brother, can you spare a dime?” is one of the best-known American songs of the Great Depression. The question was commonly asked by drifters hoping to be able to use the dime to buy a meal or two as they wandered the country looking for work. However, that was the 1930’s. Thus, it begs the question: in today’s economy, what’s a dime really worth? Is it still worth just a meal or two? Up until 1965, most American coinage was comprised of 90% silver, which is commonly referred to today as “junk” silver. Starting in 1965, the U.S. Mint diluted our coinage with lower value metals, with our nickel being the only current exception. Imagine a world where the fiat dollar has collapsed. As John Lennon would tell us, it’s easy if you try. The excrement has made contact with the oscillation device. Things are tough all over. Fortunately, your neighborhood has managed to maintain or regain some semblance of peace and security and has announced an open market for barter, where it’s highly doubtful that now worthless fiat paper currency would be accepted. Some neighbors have advertised that they have eggs from their chickens. Some have ammo in various calibers. A number have baked loaves of bread they hope to exchange for something of like value. There’s even one neighbor who has a dairy cow and some milk. From reading SurvivalBlog.com, you wisely chose to stash away a few rolls of pre-65 silver dimes when times were still relatively good, along with a few other silver coins and even a little gold, and you are merrily on your way to the market, hoping to stock up on a few fresh commodities and other supplies. What would be considered fair market value in exchange for one of those pre-1965 90% silver dimes? In short, what’s a dime worth? Preppers everywhere are encouraged to have some precious metals as insurance against currency collapse. Gold and silver have been money and a store of value for at least 3,000 years. That status will return after the “paper” era has collapsed. For Americans, pre-1965 coins (a.k.a. “junk” silver) are probably the most common. They are affordable, widely recognized, and trusted. When the current fiat dollar eventually does collapse, people will quickly resort to barter. In a post-SHTF situation, the most valuable commodity will most likely be food, followed next by ammunition. Some people may make the mistake of stockpiling large amounts of precious metals at the expense of a deep larder or other commodities, thinking that they can buy all the food and anything else they may need, but they may be in for a very rude awakening. As the saying goes, you can’t eat gold. When people say to me, “I have a year’s supply of food, now what’s the next best thing to stock up on?” I recommend another year of food. Nevertheless, having a supply of precious metals stashed away is only prudent insurance. It is safe to presume that many people would use “junk” silver for barter. But to do so effectively, one must first ask the question: What’s a dime worth? To answer this question, one must first determine a realistic value of gold and silver– the most common precious metals one can expect to encounter in a barter situation. First, we must understand that the actual value of precious metals doesn’t really change, but what is really happening is the fluctuation in the value of the fiat dollar. For example, a gentleman was able to buy a well-made, tailored, business suit with a one-ounce gold coin throughout the 1800s. The same can be said today, demonstrating that gold holds about the same value as it has for hundreds of years. Starting with gold, we see that it peaked in July 2013 at almost $1,400 per Troy ounce, and for the last year it has roughly hovered between $1,100 and $1,200 per ounce. So, for the purpose of establishing relative value with other commodities in our current market, we will use a conservatively rounded estimate of $1,200 by today’s prices. Next, for silver, it gets a bit trickier (or easier, depending upon one’s perspective). Those familiar with the precious metals markets understand that their actual values are being suppressed by manipulative banksters to continue to prop up the failing fiat dollar for as long as possible, to serve their own purposes. The Gold/Silver ratio is currently being manipulated at an unrealistic 75-to-1. Many have cited that the Gold/Silver ratio should be roughly 16-to-1. This was an historic level that existed largely prior to 1900, during periods when both gold and silver were routinely fixed prices. The ratio as a result was largely fixed as well. Thus, we can see that the true value of silver is being heavily suppressed. Precious metals and commodities brokers have spoken of this suppressed value for years and have been anticipating that at some point in the future the ratio will re-balance itself back to a more believable ratio. When the fiat dollar does collapse, it is expected that precious metals will “increase” in value—or more accurately, the value of the fiat dollar will plummet. When this happens, it is expected that silver will rise proportionally higher than gold, in order to re-establish its historic ratio in value. Thus, some investors advise placing a heavier emphasis on silver than gold, as a greater return is more likely. If we accept, for the purposes of our example here, a value of $1,200 per ounce for gold and a relatively conservative gold-to-silver value ratio of 20-to-1, then a more reliable value for silver based on its historical ratio would be closer to $60 per ounce, as opposed to its currently suppressed $16 per ounce. A pre-65 dime contains .07234 Troy ounces of silver. If we calculate its value based upon the more historically accepted ratio, this dime would represent approximately $4.34 in today’s dollar value. For simplicity’s sake, let us round this conservatively to $4. Now, we ask, when we walk down the aisles of our local grocery store, what’s currently priced for about $4? Let’s start with the staples:
- Two gallons of milk
- Two or three loaves of bread
- Two or three dozen eggs
Walking down the aisles of the local supermarket, I saw that most average-sized canned food items and bags of dried pasta were being sold for about $1 each. Expect that fresh produce from your local farms will, of course, be priced seasonally. Naturally, as with all things, prices and values will fluctuate based upon local supply and demand, as well as the quality of the merchandise. For example, if you happen to live in the dairy land capital of Wisconsin, then you may be able to get three or four gallons of milk for your dime. What about ammunition? For ammo, I stick to U.S.-made only, and I encourage all to do likewise. We need to support our own indigenous ammo producers. Here are some common American brands and popular calibers from Sportsmansguide.com: So now, if we want to barter using ammunition, we have an idea of the different values compared to a pre-65 dime. This can now be cross-referenced with food, and we know now, for example, that four rounds of 5.56mm ammo are about the same value as a gallon of milk. Okay, so now we have an idea of what a dime’s worth. But what about other junk silver coins? Well, in this particular case, the U.S. Mint seems to have done us a favor, because the amount of silver in a pre-65 quarter is precisely 2.5 times the amount in a dime. What about a pre-65 half dollar? You guessed it. It’s five times, and for those of us that still occasionally struggle with math, yes, two pre-65 quarters equal a pre-65 half dollar. Thus, these three coins can easily be added, combined, and divided as needed to create different transaction values, with no fractional losses or drawn-out calculations! Now, with the Morgan and Peace Silver Dollar coins from 1878 to 1935, we unfortunately must delve into fractional accounting. Likewise, I realize that the “Silver” Eisenhower Dollars dated 1971-76 contain 40% silver, but I have personally chosen to trade these in to avoid any possible mix-ups. With Silver Eagles and Standing Liberty one-ounce coins, these likewise do not divide evenly into our junk silver coinage. But this chart will help you get close, and then haggle from there. For those holding gold but little in the way of silver, hopefully this demonstrates the need for lower value coinage, as it will be tough to find enough “change” to purchase a loaf of bread with even a 1/10th-ounce gold Eagle, which would be valued at about $120 in this example. Keep in mind that when bartering at an open-air market, there will be no banks or exchanges to break down denominations—unless someone has a sufficient supply of coinage and chooses to open their own booth for just such a purpose, for a small fee of course. So, for all of us who have ever collected junk silver coins and wondered, “How will I use these? What are they worth?”, now we hopefully have a better idea of comparative values and a foundation to start from. This way, you’ll know when someone is trying to sell you a loaf of bread for a one-ounce silver coin that it may be an opportunity to practice your haggling skills! Good luck and happy bartering!