The Declining Value of Your Dollar
I think that one thing illustrates the declining value of money very well. Simply look back at a point of time, and consider the amount of money took to purchase ordinary things that we still use every day. Then take a look at the amount of silver in $1 of US silver coins that actually circulated in currency. We have mentioned before that $1 of US silver coins contains .715 of an ounce of silver. So, for use as a standard, we shall call that a “standard” dollar, even though a quick look at the US silver coins calculator shows that today, that .715 ounces is worth about $12.23 of the coins or paper money you probably have in your pocket.
Now, with even The Wall Street Journal writing about potential food price increases, and that maybe we should stockpile food as an investment, we must look at some food items! Let’s take a common box of Cheerios cereal. It was .39 in 1963, but today that same box of Cheerios breakfast cereal tops out at $4.39. A loaf of Wonder Bread, the plain bread standard, was .29, and now it can sell for $2.89!
In 1963 a gallon of gasoline cost .29, and yes, I am just old enough to remember this. Where I live that same gallon of gas is about $3.30 today. Who knows what it will be tomorrow? Somehow I assume it will be closer to, or more than today’s price, and not closer to the 1963 price.
What is Silver Worth?
But look, $1 bought 3 gallons of gasoline or loaves of bread back in the early to mid sixties. That would have bene $1 in US silver currency (minted on or before 1964). Now the $12 and some change that the .715 ounces of silver in $1 of US silver currency is worth today, will buy about 4 loaves of bread or gallons of gas.
It may be time to consider hedging against inflation with some precious metals, and of course I like silver because it is, after all, the poor man’s gold! Or maybe we should just all go to the grocerty store and stock up on peanut butter and Cheerios. They store very well, and if the price inflation continues, may turn us a nice profit on the future breakfast cereal exchange or black market.
inflation, recession, depression, silver, gold
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