4 ms·
You have to also consider the money supply and creation of commercial credit in the system. If the currency was a true stable store of value, the savers would
by tmaly 9y ago
You have to also consider the money supply and creation of commercial credit in the system. If the currency was a true stable store of value, the savers would be rewarded. Over time, the value of their money would purchase more due to innovation and reductions in price.
Historically, before the Gold Reserve Act of 1933, the one ounce double eagle gold coins were valued at $20. You could buy a good suit with just one of those coins. Fast forward to the present, if you take a current double eagle one ounce gold coin that is produced today, you can still buy a good suit with it.
- djrogers 9y agoI don’t know what kind of suit you could buy but I 1933 for $20, but I know that today 1200 is far more than you’d need for a ‘nice suit’ due to price reduction and globalization.
- tmaly 9y agomy point was that you could buy a suit for the $20 prior to 1933 and with the same coin today still buy a suit. The currency was stable, so it protected a person's savings. You hear all these horrible stories of elderly people having to choose between food and medicine. Prices keep escalating, and these elderly people live on fixed incomes.