1934-2013 / Insane Price Inflation Comparison of Food & Silver

I checked the Price Inflation of Food & Silver compared to the prices in 1934.

I used basic algebra and calculated the percentage of increase of prices of a few common foods and commodities.

Sugar: 1,751% Increase
Steak: 4,239% Increase
Onion: 1,233% Increase
Coffee: 3,228% Increase

Silver Purchase Act: 4,300% Increase

I used some newspapers with ads in them that I found under the carpet in a foreclosed home that I am fixing up.

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4 comments to 1934-2013 / Insane Price Inflation Comparison of Food & Silver

  • po rich

    Nice that you take an interest in such things…putting in inflation adjusted wages might have been nice with this.
    A few things to take into account….is the modern sugar 5lbs or 4?
    6lbs. of onions….now they are sold in 3 or 5 lb packages.
    Coffee….most cans now are 14 oz, not a pound
    PS if you drew two dots and a nose at the top of your underarms, there might have been a bearded Magoo for someone to smile at when your back was turned!!!
    best of luck!
    Po Rich

  • James Tetreault

    If your ever in Fenway Park in Boston, the home of the Red Sox, you might notice a display on the ramp that goes from the lower concourse area underneath the stands up to the back of grandstand sections 26 and 27. Half way up the ramp on the side of a brick wall there’s lettering reading something like “The First Red Sox Dynasty”.

    It has copies of the front pages of Boston newspapers on the days that the Red Sox won the World Series in 1912, 1915, 1916 and 1918. (The Red Sox really did have a great run there in the 1910’s. But the most interesting things on these copies of the front pages of newspapers is not the “our boys win” sort of articles but the ads. There are all kinds of ads for complete meals of a couple courses plus dessert plus a drink for . . 25 cents.

    But the Federal Reserve is serious about keeping prices stable. Suuuuuuure.

  • Cunning Linguist

    Thanks for the info Cal. It’s amazing how much prices have increased over the years. Of course I remember buying Sunoco 260 (ultra hi-test gas) for 29c too. The sugar price quoted for today seems awful high to me. I live in Florida where they grow the stuff, so maybe that has something to do with it, but I bought a 4lb. bag today (on sale) for $1.79, regular price was $2.49. Your store is pretty close to mine on the rest of the quoted prices though.
    One more thing I found interesting in your video is the price of silver paid by the government. Most people quote the typical silver/gold ratio as historically 16:1. Using your number of 50c for silver and the known fact of the price of gold in 1930’s being fixed at $20 an ounce gives you a silver/gold ratio of 40:1 NOT 16:1 HMMM IF the historical ratio was truly 16:1 as most people always say then, the silver price in 1934 should have been $1.25. If 1934 was AFTER they stole/bought everyone’s gold and reevaluated it at $34 an ounce, then the silver price should be EVEN HIGHER STILL at $2.12 an ounce.

  • The things that weren’t mentioned were the important parts. The parts that nobody either understands, or thinks about.

    The price of any given item always seems to go up, with inflation, but since people are told “inflation is a good thing, as it shows that the economy is growing”, and they simply buy into the lie, and look no further into it.

    Now here’s where most people stop thinking.

    First, is the difference between “cost”, “value” and “price.”

    The “price” is “the amount of currency you need to purchase a given item.”

    The “cost” is “everything that goes into the creation, growth, or manufacture of the item.”

    The “value” is “the utility or benefit received from the item.”

    Now, over time, we all know that there are advances made in all things. There are advances in materials, manufacturing, design and engineering, processing, assembly, distribution, and more. Each advance is made in order to reduce the cost of creating any given product to market. Logic dictates that if every advance made also concurrently lowers the cost to produce an item, that the price should also be lowered commensurate to the drop in the cost to produce the item.

    It doesn’t, however, because of the monetary fraud which is called “inflation.”

    Inflation does NOT mean “the economy is growing” at all. It simply means that “the value of the currency used to denote pricing” has gone down. Put another way, your currency (it’s NOT “money”, folks!) is worth less, so it simply takes more currency to purchase the same item.

    Now there’s the idea of “value.” We’ll take a 1912 Model T, at a cost of $900.00. (http://modelt.org/index.php?option=com_content&view=article&id=11:original-model-t-ford-prices-by-model-and-year&catid=5:history-and-lore&Itemid=1)

    At the time, gold was valued at $20.67 per ounce by this chart: http://www.indiabullion.com/gold_history.php or $18.98 by this one: http://www.nma.org/pdf/gold/his_gold_prices.pdf‎

    If the price of gold was $20.67 per ounce, you could have bought the “top of the line” 1912 Model T for $900.00, or 43.54 ounces of gold. If the price was $18.93, it would have set you back 47.54 ounce of gold. (I am inclined to believe that the latter calculation is correct.)

    Now let’s update our figures with items of “substantially equivalent value.”

    First, we’ll update the “Top of the line 1912 Model T” with the “Top of the line 2013 Shelby Cobra Mustang.” The “price” of the car has gone from $900.00 to over $60,000.00. The “value” has actually remained constant. They both have four wheels. They both have seats inside. They both have an engine. They both get you from “Point A” to “Point B” equally well (let’s ignore the fact that the Cobra’s gonna get you there quicker, more comfortably, and using slightly less fuel, as those are simply “advances” which we already knew happened, and which lowered the actual cost to produce the item each time such a cost-saving advancement was made in the 101 years since that time.)

    So the “value” of the vehicles remained constant. So why the MASSIVE hike in “price?” Especially when you consider the hundreds of thousands of tiny, incremental advances, which ALL led to the lowering of the “cost to produce” the vehicles?!?

    Again, we go back to the idea that the “price” is set in “fiat dollars”, which, through inflation, have gone dramatically downward in value, which reduces your purchasing power. Too bad you weren’t buying the car with gold, right?

    If you were to buy your new Cobra today, and paying with gold at “this very second’s price” of $1329.00/oz, it would set you back about 45 ounces of gold. It almost seems as though the “price” has remained somewhat stable…at first glance.

    Now, in 2011, when gold was closer to $1800.00/oz, however–keeping in mind that the value of an ounce of gold remains constant, and the value of the car also remains constant–you could have bought the same car (or an equivalent model) for only 33.33 ounces of gold. Now the change is much more obvious!

    Now imagine the difference if, as many people expect, gold is going to shoot skyward to $5,000.00 per ounce, or even higher! Then you’d be able to get that car for only TWELVE OUNCES of gold…or less!

    The value of the gold has remained constant. It doesn’t oxidize, and an ounce of gold a million years old is still an ounce of gold. The value of the vehicle has remained constant. The cost to produce has gone down all the while due to all of the advances which occurred on all levels over the previous CENTURY.

    The ONLY reason that the “price” continues to go up is because the “value of the currency” has dropped.

    I’m sure that there are other points that Chris can better elaborate on, but hopefully that’ll help get more people’s minds wrapped more tightly around what he’s been trying to tell people for so long now.

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