Gold/ The Value Holds Over Time
THE VALUE OF GOLD
Over time, has the value of Gold hold? Some people complain that the things they buy are getting so expensive that they can hardly make it today. In reality, is this really the case?
In an article (Does Gold Preserve Purchasing Power?), Craig Rowland records the following values for Men’s suits vs the value of Gold:
The prices for the suits and gold are from October of that year.
Men’s suit, worsted, 7.00-16.00/each
One Ounce Gold: $20.67
Men’s suit, tweed, 25.00/each
One Ounce Gold: $35
Men’s suit, shaped double-breasted, wool, 56.95/each
One Ounce Gold: $35 * (in 1971 we broke the gold standard. This official price was too low. By 1972 the gold price shot to $65 an ounce essentially matching the prices from previous decades in terms of purchasing power.)
— Gold standard broken in 1971 — Gold allowed to float against the dollar and inflation went into the double digits.–
Men’s suit, wool worsted, 425.00/each
One Ounce Gold: $661
(Note the price increase since 1971 when we abandoned the gold standard and inflation raged. )
Men’s suit, Evan Picone, wool, 279.99/each (inflation finally under control)
One Ounce Gold: $380
Men’s suit, 375.00-475.00/each
One Ounce Gold: $270 (who wants gold when you can own catlitter.com stock!!)
2007 (Price I paid a few months ago for some suits)
Men’s suit, $400-600
One Ounce Gold: (approx) $700
Notice the cost(s) of the suits are just under the value of Gold. However, since 1971, we have been off the Gold Value and the value of our paychecks may have increased but are they increasing at the same rate or are they falling behind this rate?
Have you heard of the term: INFLATION?
Inflation is why our buying power is not the same as it once was. In most government jobs, the employees often get a “cost of living raise”. The only reason this raise is of any importance is so the employees can “theoretically” keep up with the cost of inflation. (However, those raises do not match the inflation rate!)
DIGITAL CURRENCY/ THE VALUE HOLDS OVER TIME
However this is yet to be proven but in time I believe this is a truism we will come to know. We are in need of a stabilizing force in the World of E-Commerce. There has been a lot of talk recently regarding the idea of digital currency. This is not just talk but it is reality. There has been a lot of movement on the financial horizons and there is a show of promise. For years, all we heard was the loss of value of the US Dollar. Now, there is emerging information regarding digital currency that shows promise for a more stable system for monetary transactions.
Since Bitcoin is the rising star in this industry, here is a bit of information from an article by Evander Smart (WHY BITCOIN VALUE VS. THE DOLLAR DOESN’T MATTER (AND NEVER WILL)):
That Bitcoin value has not only survived on a global basis for more than five years, but thrived, and attracted some of the largest merchants worldwide (PayPal, Dell Computers, Dish Network, etc.). This is much more relevant than any comparison to a currency that is in it’s final years of relevance itself. If that doesn’t prove the inherent strength of Bitcoin value, nothing will.
You can read the rest of the article and come to the realization that we are in a strong place. Most of the readers of this are (or will soon be) familiar with another company- COMPUMATRIX.
Standby for the “Rest of the Story”.