Would Canadian dollars circulate in the US as a replacement currency?

Given the stability issues of the American dollar would foreign currencies like the Canadian (CAD), affectionately called the "Loonie" by Canadians, or Australian (AUD) dollar or even the Swiss Frank (CHF) become substitutes for the fading US dollar?

I imagine Canadian dollars (CAD) will begin bleeding across the border more frequently and permanently soon after the American dollar (USD) becomes worth less (note I said "worth less" not worthless) than its northern counterpart. But the real penetration of the Loonie into the southern states will come with the realization that the condition isn't temporary and that the USD is approaching near worthlessness.

Residents on both sides of the Canadian/US border are used to the daily fluctuations in the exchange rate of the CAD vs. USD and take it in stride often trying to take advantage of the situation by shopping on the side of the border that gives them the best bang for the buck (or Loonie as the case may be).

Look at the "EXCHANGE RATES" chart at the bottom left of the page. The "CAD/USD" rate is the one we're talking about.

If the Loonie catches on as a unit of exchange vis-à-vis the greenback in the USA the demand will be tremendous. The government of Canada provides physical money (cash & coins) for a population of less than 35 million people. The population of the United States is over 300 million. It is with good reason that they refer to us as "The Giant to the South" among other less flattering terms.

There would be pressure on the Canadian government to increase it physical money supply, but doing so would decrease the fiscal health of the Loonie. In a country experiencing hyperinflation the news that the foreign currency they were coming to depend upon was ramping up the printing presses might undermine the value of the Loonie here too.

Australia isn't eager to accept hordes of penniless refugees either. However I've been told that remotely opening a bank account there is possible contact: Addy Cheong Business Manager, Westpac Business Banking, Westpac Banking Corp.
addycheong@westpac.com.au
There'd be little problem adapting to Australian English but getting there would be a long swim.

Switzerland is famous for it's clocks, cheese, chocolate and desire to stay Swiss. I've been told that opening a bank account in Switzerland requires a visit in person and a search for a Swiss bank willing to accept American deposits. Although most Swiss speak some English you'd be at a distinct disadvantage, language wise, there.

One solution might be to have an account in Canada, in Loonies, in a Canadian bank. Even now Canada requires some means of self support for immigrants I imagine those rules will get more stringent if a crisis unfolds.

Canada has (from their point of view) the disadvantage of speaking the same language (except Quebec) as us and being so close to the American hordes. If it comes to that I think getting in early would be preferable.

Of course there's the little matter of taking what you have with you with you if you must immigrate in a hurry. The most commonly considered vehicles of cross border wealth transportation are gold & silver bars, diamonds, rubies, sapphires and emeralds.

The liquidity of these items is debatable. Unless you "know people" establishing the value (or even the authenticity) of precious stones, gold or silver bars might be problematical. Still Diamonds were one way some Jews smuggled their wealth out of Nazi hands.

In a crisis situation it'll be hard to get change for a gold bar or one carat diamond when buying a loaf of bread. Even a one ounce Krugerrand may be too much.

For what it's worth, my opinion is that gold and gems would be best for carrying wealth across national borders. Silver coins are much less portable in significant quantities but would be useful for stay-at-homes buying groceries in a TEOTWAWKI situation.

Survival sites traditionally recommend booze as "trade goods" for "survival situations" meaning hard liquor because Beer and cigarettes don't store well for long periods.

Yes Jim Beam and Johnny Walker would make good long term bunker buddies as would other brand name whiskies as long as you don't partake of too much the merchandise before trading time.

For medium term trade goods consider over the counter medicines. Most have about a year's shelf life (it's printed on the side of the bottle) and I've been told by a Special Forces medic that most over the counter medicines are useable (albeit with somewhat inhibited efficacy) long after the "sell by" date if stored in a cool dry place. I keep a year's supply on hand of each of the over the counter medicines we use and plan to stock up with several years worth if given a chance when the balloon goes up.

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Total TEOTWAWKI

I've been basing my planning on the assumption of the phases of Total TEOTWAWKI something like this:

1. Pre Accumulation phase
• Wherein people who prepare (often called "Preppers") store extra amounts of food, water, supplies and medicine during "normal" times.

2. Post Accumulation Phase
• Wherein people who didn't stock up ahead of time make a mad dash for the store. The scenario will be sort of like in the Southeast or North when a hurricane or blizzard is predicted only much worse.
• If civil authority is perceived* to have failed this phase could get violent.
(*Perception is reality, at least insofar as how we react to it.)

3. Hunker down phase
• Wherein "Preppers" and "survivalists" (preppers with guns) hunker in their bunker or hide in their homes.
The prepared ride out the famine and the resulting die off while the unprepared are forced to wander in search of food, water, supplies and medicine.
• Anyone wandering near a bunker is likely to get shot.
• Anyone breaking into a home is likely to get shot.

4. Reemergence phase
• Wherein the survivors emerge into the post TEOTWAWKI world.
• This is the phase when old alliances will be tested and new alliances forged.
• Family groups will be the nexus as clans and tribes are formed which, in turn, will morph into towns, cities and city states.
• Basic services (food, water and shelter/protection) MUST be delivered by these groups or they will wither and disband. That means the group must obtain or maintain food by any means necessary. Yes, back to barbarians at the gates.
• Whatever is left will be salvaged by whoever is left. I expect something like Europe after the Black Plague where empty houses and lands were free for the taking and outlaws roamed the land.

In my estimation there will be two phases in a post TEOTWAWKI world where gold, silver and diamonds would be useful:

• For a short time immediately after the TEOTWAWKI event when people hope/ expect/ wish things will soon get back to normal. During this period people will be willing to trade their food or medicine for gold, silver or diamonds in the expectation that they will have the better of the deal when things get back to normal and a gold coin will again be worth more than a can of beans. (Picture Homer Simpson trading his family's last canned ham for the Hope diamond and then realizing they don't have any food left. "D'oh!")

• During the following famine starving people will not be willing to trade food for any price. When it is realized that many medicines can no longer be manufactured those who need the medicine will hang on to them like life itself. Gold, silver and diamonds will probably not be valued highly in such circumstances.

• During the reorganization phase as clans and tribes form cities and city states. Once order is (more or less) reestablished there will again be a need for money to facilitate trade. Although I very much doubt anyone will be willing to accept fiat paper script again, gold and silver coins will probably serve as money. Diamonds, gold and silver bars would be useful for larger purchases like land.

In summary I expect gold, silver and diamonds to be useful going into and coming out of a post TEOTWAWKI world.

In the middle phase gold and silver coins would be almost as worthless as the government's paper tender which would have value only as tinder.

Food would have value because people have to eat.

Guns & Ammo would have value because although you can't eat guns a guy with a gun can get food from a guy without one.

• How will it play out? Who knows. The history of humankind is tyranny. Will our democratic tradition hold, or will the need for a strong leaders establish tyrants?
• It would be a waste of our time to discuss what we think SHOULD happen since our chances of controlling it are miniscule.
• A more fruitful endeavor, however, might be to discuss ways of setting up the framework now for a better world then.

* Perception IS reality, at least insofar as we react to it.

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