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$60,000 in 1960 is over half a million today.
Think about that for a second.
The traditional "good" inflation rate is 3% per year and that would be $364,101.07 today.
$60,000 to $563,408.11 from 1960 to 2021 is a "mere" 3.741% annual inflation.
Mere.
Gold in 1960 was $35.27 per ounce. It's $1,782.94 today. That's just 6.64% inflation.
Pay attention to that.
Gold is going up twice as fast at the observed inflation rate.
Gold's buying power is about the same as it was.
It's something that keeps occurring in my gaming notes.
An ounce of gold buys the same basket of goods for centuries, but it takes more and more fiat currency to get that ounce of gold (or the shit that it'd but).
I've seen a meme to the effect that before they took the silver out of the coinage, minimum wage was $1.25. That's five old-style silver quarters. To buy them now, you'd need about seventeen or so dollars in inflated currency. As long as the government insists on inflating the currency (a worldwide phenomenon; theck out how much you could buy with a pound sterling in, say, 1914 as opposed to now) we'll have problems.
ReplyDeleteI watch certain commodities. Price of Eggs, Milk, and 2-liter sodas.
ReplyDeleteSurprisingly, Eggs have remained stable for 4 years or so. Price is more tied to fluctuations of use and periodic kill-offs due to disease, but chickens bounce back quickly.
Same with milk. Been slowly creeping up but not as bad as some prices.
Sodas are interesting. What, 4 years ago, was $1.99 a 2-liter is now $2.50. Sugar, non-sugar sweetener and other ingredients are still about the same price. What's increased is cost of the bottles and labor costs. Labor costs increasing thanks to socialists pushing the $15.00/hr minimum wage.
As to gold, all those people out there saying "Buy precious metals, especially gold" tend to forget that at one time the Federal Government outlawed private gold ownership except that found in jewelry.
From bullionbypost.co.uk: The resulting executive order – 6102 – paid a derisory rate of 20.67 US Dollars, for one troy ounce of gold. After May 1st, 1933, anyone who had not exchanged their gold was subject to arrest and up to 10 years in imprisonment. The Gold Reserve Act ratified this order on January 30th, 1934, and changed the gold price to $35 an ounce, making an immense profit on their newly acquired assets.
What makes current people think our current overbearing tyrannical grasping government won't do the same. As to giving 'fair' price to the required sell-back amount, anyone really get their fair value out of forced sales of anything to government, be it land, cars, oil, gold?
I remember reading (sorry, I can't remember where) that the amount of gold that was equivalent to the purchase price of a new Ford Model T is now worth the price of the cheapest Ford currently produced.
ReplyDeleteI ran the numbers at the time (because I'm a suspicious bastard), and, lo and behold, it was true!
Of course the current vehicle is streets better (SWIDT?), but that's technological advancement, not the inflation to which this post refers.