Precious metals during Russian revolution

Sometimes, famine is caused by times of crisis when those who are in power start shipping so much of the remaining food off to keep themselves, their troops, and their enforcers fed that those who are not vital to keeping their regime in power become disposable.

In early 1917…So began the nightmare of the Russian Civil War which killed 7 million people. Of those 7 million deaths, roughly 5 million were from starvation.

Even though parts of the Russian Empire had been considered to be some of the great break baskets of the world, both the continuance of large scale agriculture, and the distribution of its output, were badly disrupted…

In Moscow during the winter of 1919-1920, the food situation was so bad that Lenin and his Communists allowed the continued existence of a large open air black market bazaar which everyone called the ‘Sukharevka.’ The Communist government didn’t shut the Sukharevka down until 1925.

One journalist described the Sukharevka that winter as “a crowded study in need and greed,” where ANYTHING could be had – for a price. Even Lenin admitted that without the Sukharevka, Moscow would have starved to death that winter…

In the fall of 1919, a single pud (1 pud = 36 US pounds) of flour cost between 6,000 and 7,000 gold rubles.

A late Czarist era 5 ruble gold coin was .900 fine and contained 0.1245 troy ounces of gold. So, 6000 gold rubles would be 1200 five ruble gold coins at 0.1245 ounces of gold per coin. At a price of 6000 gold rubles per pud, that’s the equivalent of 4.15 troy ounces of gold per US pound of flour. In modern exchange, with gold in mid-2012 fluctuating around $1600 per ounce, that’s around $6,600 in current US dollars per pound of flour, payable only in gold or silver, and that was before the real winter even set in.

In mid-November 1919, one man reported that he was able to buy 10 eggs and 4 pounds of soap for 1000 gold rubles (24.9 troy ounces of gold).

By mid-January millet had risen to 9,500 to 10,000 gold rubles per pud. In modern American measurements, that’s 6.57 to 6.91 troy ounces of gold per pound for millet.

Six weeks later, at the beginning of March, flour had risen to 13,000 to 15,000 gold rubles per pud (9 to 10.375 tory oz. of gold per pound of flour) and millet had risen to 16,000 to 17,000 gold rubles per pud (11 to 11.75 troy oz. of gold per pound of millet).

For those living in the city, the choices were few and grim. You either paid the price for the food, or you starved. The other options included banditry, cannibalism, or scraping the wallpaper paste off of the walls and using sawdust to make whatever food was available to go a little further…

To put the inflated famine prices of food that winter into perspective, in mid-2012 gold was fluctuating around $1600 per troy ounce. That meant that by March, during that winter of famine in early 1920 when food was at its most scarce, ordinary flour was going for the modern gold equivalent of around $16,000 per pound…

Remember that guy who paid 24.9 oz of gold for 10 eggs and 4 pounds of soap? That was in November before the famine got anywhere near its worst. That’s the modern equivalent of about $39,800 for 10 eggs and 14 large bars of soap. That’s $39,800 worth of gold, not inflated paper currency.

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Precious metals during Russian revolution