From: Opening page of The Inflation Report (contains 14 charts)
By Michael Hodges – email
updated Sept. 2007
- a chapter of the Grandfather Economic Reports -
INFLATION – WHO SAYS IT’S DEAD?
88% EROSION OF PURCHASING POWER – AND CONTINUING
- a dollar in 1950 will buy only 12 cents worth of goods today, 88% less than before –
Inflation in my adult years increased average prices 1,000% or more -
example 1: a postage stamp in the 1950s cost 3 cents; today’s cost is 41 cents – 1,266% inflation;
example 2: a gallon of 90 Octane full-service gasoline cost 18 cents before; today it is $3.05 for self-service – 1,870 % inflation;
example 3: a house in 1959 cost $14,100; today’s median price is $213,000 – 1,400% inflation;
example 4: a dental crown used to cost $40; today it’s $1,100 – 2,750% inflation;
example 5: an ice cream cone in 1950 cost 5 cents; today its $2.50 – 4,900% inflation;
example 6: monthly government Medicare insurance premiums paid by seniors was $5.30 in 1970; its now $93.50 – 1,664% inflation; (and up 70% past 5 years)
example: several generations ago a person worked 1.4 months per year to pay for government; he now works 5 months.
And in the past, one wage-earner families lived well and built savings with minimal debt, many paying off their home and college-educating children without loans. How about today?
Few citizens know that a few years ago government changed how they measure and report inflation, as if that would stop it – - but families know better when they pay their bills for food, medical costs, energy, property taxes, insurance and try to buy a house.
Is inflation a threat to society? Consider this famous quote:
“There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.” Lord John Maynard Keynes (1883-1946), renowned British economist.
DEFINITION OF INFLATION:
Inflation is the loss of a constant purchasing value of the dollar,
caused by an increase out of ‘thin air’ of the supply of money and debt creation by the financial system
Related: All of my posts on INFLATION