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Listener Margaret L. asks: 

I understand the traditional value of gold in world culture so far. What I don't understand: If real economic collapse comes — a dystopia — why gold is still said to be the thing to have. Why would gold still be valuable when competition to simply live would be people's concern? You can't eat gold. 

In a typical doomsday prepper’s home, you might see bars of gold stacked between bottles of water and canned goods.

For those anticipating the end times, gold has become the currency of choice. Prepping startup companies sell kits that usually contain some gold bullion, said Robert Kirsch, who co-authored the book “Be Prepared: Doomsday Prepping in the United States” with his colleague Emily Ray. 

“There's a sort of fear that in the United States, there is money that is backed by nothing, and this instills a kind of existential dread. So people are trying to figure out, ‘OK, but what actually represents money?’” Kirsch said. 

In the event of an apocalypse, these people want to know that what they own has intrinsic worth, Kirsch said. 

Gold is perceived to be a safe haven asset, which is why people hold onto the precious metal during times of economic uncertainty. An ounce of gold was worth about $2,063 at the start of 2024 and is now worth $3,363 an ounce – a 63% increase. More consumers are stocking up on gold because of President Donald Trump’s tariff policies and concerns about inflation.

“I do think there's a sort of psychological comfort in gold,” Kirsch said.

The perception that gold is a safe haven asset is a fair assumption since it’s held its value over thousands of years, said Campbell Harvey, a finance professor at Duke University. 

The world’s gold supply is diversified, which means no one country controls gold production, Harvey said. “It’s kind of like a world currency,” Harvey said. 

But it’s a volatile asset in the short term, Harvey noted. “Most people's horizons are not measured in millennia or centuries,” he said. 

If we’re talking about an economic crisis, sure, gold could be useful, economists say. But if there’s a real doomsday scenario and society completely collapses, then gold is unlikely to retain its value. 

Doomsday scenario

To understand what an apocalyptic future would hold, it’s helpful to look at our ancient past. 

Hunter-gatherer societies exchanged practical items, not precious metals like gold. “The earliest known form of currency was grains of wheat,” said Geoff Schneider, an economics professor at Bucknell University. 

If obtaining food is the essential activity in your society, then food will be your currency, Schneider said. 

Gold does have some inherent qualities that make it appealing, like its metallic luster.  “It's shiny and pretty, and humans like shiny, pretty things,” Schneider said.

It also doesn’t rust, it doesn’t tarnish, it conducts electricity and it’s scarce, Schneider explained.  

But while it has qualities that make it intrinsically valuable, that doesn’t make it a currency, Schneider said. 
Gold wasn’t used as a currency until the Egyptian pharaohs declared it as their currency around 2700 B.C.E., Schneider said. 

“The pharaohs had established a system in which values of goods were expressed by weights of gold, silver and copper, with gold being the most valuable and most used,” he said. 

The pharaohs controlled stocks of gold that they would mete out in small amounts, which the population would then work for so they could pay their taxes, Schneider explained. 

“Your currency cannot be freely available to everybody, otherwise it ceases to have value. And the reason that you want to create a currency as a monarch is you want people to pay you in your own currency. It's a power structure,” Schneider said. 

Thousands of years later, the U.S. and many other nations temporarily adopted the gold standard, a system in which a country’s currency is backed by gold. 

But not all societies with access to gold decide to adopt it as a currency. Indigenous communities used it for art and decoration instead, Schneider said.

If there’s an apocalyptic event, gold could be used as a form of currency because we’ve now reached a point where everyone considers gold to be valuable. But it’s more likely that society will favor items that are useful, Schneider said. 

“If you think about the first ‘Mad Max’ movie, it's oil. So it could easily be something like that, although I think food is probably the most likely,” Schneider said. 

Richard Langlois, an economist at the University of Connecticut, also thinks practical items would be the most highly-prized goods in the event of a societal collapse. 

“You want to hold assets useful in that situation, like guns, and bottles of water, and cans of beans. Gold wouldn’t help very much,” Langlois said. 

An economic crisis 

Now, if the U.S. is dealing with an “ordinary” economic crisis, gold could come in handy.

If the country undergoes hyperinflation because the government is printing too many dollars, then they would lose value, making gold more appealing, Langlois explained. 

That happened to Zimbabwe starting in 2007. “A crisis caused by civil conflict over land ownership resulted in an economic collapse. The government made up for revenue shortfalls by printing money which led to hyperinflation,” Schneider said. 

After the Zimbabwean dollar became worthless, the country began using the U.S. dollar and gold instead, Schneider said.

“Gold is a safe haven if you're worried about your economy or your currency value,” Schneider explained.

And right now, people are concerned about the U.S. dollar, which has weakened thanks to Trump’s trade policies. That’s helped pump up the price of gold.

Even if there’s no doomsday scenario, there are some who advocate for America’s return to the gold standard. But that would pose problems for our economy because of gold’s finite supply and our inability to control it. 

“What you need in a currency is a stable amount of money that increases enough to allow for growth and new spending, but not too much to cause too much inflation,” Schneider said. “A good idea is to increase the money supply every year … modest inflation is not a bad thing, and a little extra money in the economy allows for economic growth.” 

And that’s all possible by having an independent institution like the Federal Reserve. 

“What is really good for an economy is a nice, careful central bank that understands monetary value enough to know how much it can increase the money supply without causing too many problems,” Schneider said.