Thread: Inflation

everything is going up in price, thnkfully here in central pa i have acess to hogs and cattle to butcher each winter and i raise my own eggs lol but what we cant grow ive noticed how the price has went up withing the last year i just hope that one day proces will come back down or wages will go up

More people = less food = higher prices.

Originally Posted by Wintchase

More people = less food = higher prices.

Along with squandering a large percentage of the corn crop to be added to gasoline....

We ALL know how wonderfully efficient that is.

I don't post much on these topics, but Jimmy's close on his estimate of 90% devaluation. Conservative measures are mostly around 95%, majority of measure are closer to 97%. The famous example being that in 1911 a premium man's suit sold for a $20 gold piece. Today, that same $20 gold piece can be sold - and still buy a premium man's suit. That can't be done w/ a $20 bill.

I can't remember if it was Murry Rothbard or Lew Rockwell that said the Govt. is the only enterprise that can take good paper, and by applying green ink - reduce its value.

I'm not sure why focusing on such a meaningless thing as how much an arbitrary unit of measure can buy. The value of 1 dollar may be going down, but that also means that people get more of those in their paychecks.

The appropriate measure, I think is the standard of living. I am pretty sure most people can live at the living standard of say the 60s or the 70s or the 80s with their current income. But you have to apply it consistently, i.e. you cook your meals at home like you did back then, you live in the same size house as you did back then, you don't use a technology that back then cost millions (computers/cell phones/current model cars/etc.). And of course you compare yourself with the appropriate age group back then, i.e. if you're a retiree now compare yourself to a retiree back then...

I suspect that a lot of grumbling is simply a result of bad memory or improper comparisons. I know that at every single point of their lives my parents were much better off than their parents were at the corresponding stage, and I have been much better off than my parents had.

Of course, there will always be few exceptions, but as a general trend I think we're still making progress. And obviously if you take short-term fluctuations you make any argument you want, but that would be rather foolish.

Don't forget that the US imports a load of stuff as well, and the US dollar has not been as strong in the foreign exchange rate stakes as it has in the past for some time now. So if you happen to buy things from stores that stock imported goods you may be noticing some of that effect.

On the other side of that coin, US products are cheaper for other countries so exporting a certain fraction of output may in fact bring a producer a better return than selling entirely domestically, therefore reducing supply of that product in your domestic market, which may also then create inflationary pressure. Though for that to happen the relative exchange rates would have to be maintained for a period of time and I am not sure it has been long enough for that kind of effect to be felt "on the ground".

James.

Here in the UK things are the same. Ive just worked out that the average cost if fuel (petrol/gas) per gallon over here works out at $9.73... It stinks. The cost of food is getting rediculous... In fact all prices are getting stupid. Currently on my 5th year of a zero pay increase but being demanded to do more as if im superhuman. Also in the UK we have a 'fantastic' welfare benefits system where we pay people to sit on their fat backsides all day. This leads to them fabricating a 'disability' where we pay them more. They then teach their children how to fiddle the system and have loads of kids so they can live a bloody good life and go on loads of holidays without working... Meanwhile people like me are busting our guts to keep contributing to this so called 'fantastic' benefits system so the lazy arse holes can give birth to 4th and 5th generation benefits scum... I know it sounds harsh... But every day i deal with people who say they cant work because they cant walk...you have to pass them and give them the benefit then they go out of the office... Get out of their wheel chair and frigging start walking and dancing around. Yet i work with people who have difficulties walking and are blind and who have genuine disabilities but they work and they work really really hard... Its mad and pisses me off to high heaven.

What id do to live in the US... I love your country...

But its got me thinking... What if a few people threw all of their savings in a pot, purchased an island and then ran interviews with people wanting to get away from it all who had a trade of useful skill behind them... You could create and develop your own economy and forget your current way of life... What a dream that would be.

Sorry for the rant guys but the way things are now-a-days is a very soar point with me.

Originally Posted by gugi

The appropriate measure, I think is the standard of living. I am pretty sure most people can live at the living standard of say the 60s or the 70s or the 80s with their current income. But you have to apply it consistently, i.e. you cook your meals at home like you did back then, you live in the same size house as you did back then, you don't use a technology that back then cost millions (computers/cell phones/current model cars/etc.). And of course you compare yourself with the appropriate age group back then, i.e. if you're a retiree now compare yourself to a retiree back then...

I suspect that a lot of grumbling is simply a result of bad memory or improper comparisons. I know that at every single point of their lives my parents were much better off than their parents were at the corresponding stage, and I have been much better off than my parents had.

I think in economic lingo you are talking about the PPP or purchasing power parity. In other words do you get today with your $100 paycheck what you would with your $20 paycheck in the 60's. By rights, that answer should be yes and a little more.

Since the 40's that answer has always been yes in America. Moreover until now, the next generation has made more than the past but that's not the case today. Absolute incomes are actually down!

Originally Posted by tbert33

But its got me thinking... What if a few people threw all of their savings in a pot, purchased an island and then ran interviews with people wanting to get away from it all who had a trade of useful skill behind them... You could create and develop your own economy and forget your current way of life... What a dream that would be.

Sorry for the rant guys but the way things are now-a-days is a very soar point with me.

LOL! That's a great idea... that just so happens to occur every day, in just about every nation! Not to be cheeky, but fill out an application for a work visa to uh, say the USA and if you don't have skills, well you need not apply. Every country does it.

In a way Liberia and Israel were country's that sought out to do as such via immigrants as you state if my history is right.

Anyway - inflation is a funny thing. If enough people think it's happening on a large enough scale, it will happen. Trust in your dollar will make or break it. It's an interesting thing really.

Originally Posted by Wintchase

More people = less food = higher prices.

That's actually not correct. A famous economist back in the day by the name of Matheus (sp?) said we were all going to starve as the world population grew. Turns out we are really good at "economy's of scale" in farming. Actually, with the exception of logistics and greed, there is no reason a single person in the world should go hungry.

Earths human population is about to plateau at about ten billion I think it is... and and expected decrease after that. There is a correlation between wealth and child birth. The more wealth, the less kids.

Though the "West" has had a really bad ten years, the rest of the world in those ten years have had it pretty good. More people in the past ten years have been lifted out of the burdens of poverty than in the the history of the world. It's amazing really! And a function of outsourcing.

Of course pollution should be of concern. Google how many coal power plants China is building a year! It's scary as...

David

There are a lot of caveats to getting a work visa, just having a skill is not all it takes. IIRC most nations require a potential employer to prove that the position cannot be filled by a qualified person from the employers nations own work force. There are likely other restrictions also.

Bob