4 ms·

I just love that straight up £->USD conversion without mentioning the 150 years of inflation since 1875.

tom_ 3y ago
And besides, it was more like $5/£1 in the late 19th century: https://en.m.wikipedia.org/wiki/Tables_of_historical_exchange_rates_to_the_United_States_dollar#Table_for_1850_to_2000 https://en.m.wikipedia.org/wiki/Tables_of_historical_exchang...
- vallode 3y ago
  According to the Bank of England's inflation calculator page [1] 50 GBP in 1875 would be worth around 4,766 in today's Sterling. Not sure how to calculate the true "worth" of the exchange from GBP to USD, though. 50 GBP in 1875 would be around 320 USD (according to the Wikipedia article), does this mean that the 4,766 Sterling should be represented as 21,663 USD (according to the 1875 exchange rate) OR as 6,015 USD (according to today's exchange rate)? Not sure. [1]: https://www.bankofengland.co.uk/monetary-policy/inflation/inflation-calculator https://www.bankofengland.co.uk/monetary-policy/inflation/in...
RicoElectrico 3y ago
What is the correct way to do currency conversion and inflation adjustment at the same time?
- Am4TIfIsER0ppos 3y ago
  Just don't? Needing to add "which at the time was a substantial sum of money" means the value is so out people's experience that a foreign currency isn't any more confusing.
- LeifCarrotson 3y ago
  The best way, IMO, would be by comparing it to the wages of the rag and bone man, or the median income at the time, and potentially by comparing that to modern incomes in the UK and US. In 1875, per [1], [2], and [3], a common laborer's average annual income was on the order of £30-£50. (DDG found no data on the income of Victorian rag-and-bone men specifically.) So when the article says: > To do so was punishable with a fine of £50 (approximately US$65), which at the time was a substantial sum of money. The "approximately US$65" is only meaningful at the December 2023 exchange rate, and "substantial" is carrying all the information and doing a poor job of it. But the important, comparable thing is that it was on the order of his annual income. It might be more accurate to say that it would be comparable to fining a British person the median household income of £32,300 [4] or an American $74,580 * 0.75 = $55,935 (after taxes) [5]. Quality of living, cost of services, and various baskets of goods were more or less expensive at different times, so there are certainly additional comparisons or modifications you could do. I'm not much of a historian, but when I want to understand how much of a disincentive the fine was to a rag-and-bone man, that is a start to the kind of context I need. I don't have the context for the savings or borrowing power available to a Victorian laborer - did most people have savings accounts, an estate, retirement account, or other assets they could draw on? Did the government run installment agreements, or did a convict have to borrow from a bank and repay the loan over time? Were they just thrown in a debtor's prison until their family and friends paid the fine? I don't know. Regardless, it wasn't equivalent to me imagining a loss of $65. [1] http://www.afamilystory.co.uk/history/wages-and-prices.aspx http://www.afamilystory.co.uk/history/wages-and-prices.aspx [2] https://www.victorianweb.org/economics/wages.html https://www.victorianweb.org/economics/wages.html [3] https://www.victorianweb.org/economics/wages2.html https://www.victorianweb.org/economics/wages2.html [4] https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/householddisposableincomeandinequality/financialyearending2022 https://www.ons.gov.uk/peoplepopulationandcommunity/personal... [5] https://www.census.gov/library/publications/2023/demo/p60-279.html https://www.census.gov/library/publications/2023/demo/p60-27...

tom_ 3y ago

And besides, it was more like $5/£1 in the late 19th century: https://en.m.wikipedia.org/wiki/Tables_of_historical_exchange_rates_to_the_United_States_dollar#Table_for_1850_to_2000 https://en.m.wikipedia.org/wiki/Tables_of_historical_exchang...

vallode 3y ago
According to the Bank of England's inflation calculator page [1] 50 GBP in 1875 would be worth around 4,766 in today's Sterling. Not sure how to calculate the true "worth" of the exchange from GBP to USD, though. 50 GBP in 1875 would be around 320 USD (according to the Wikipedia article), does this mean that the 4,766 Sterling should be represented as 21,663 USD (according to the 1875 exchange rate) OR as 6,015 USD (according to today's exchange rate)? Not sure. [1]: https://www.bankofengland.co.uk/monetary-policy/inflation/inflation-calculator https://www.bankofengland.co.uk/monetary-policy/inflation/in...

RicoElectrico 3y ago

What is the correct way to do currency conversion and inflation adjustment at the same time?

Am4TIfIsER0ppos 3y ago
Just don't? Needing to add "which at the time was a substantial sum of money" means the value is so out people's experience that a foreign currency isn't any more confusing.
LeifCarrotson 3y ago
The best way, IMO, would be by comparing it to the wages of the rag and bone man, or the median income at the time, and potentially by comparing that to modern incomes in the UK and US. In 1875, per [1], [2], and [3], a common laborer's average annual income was on the order of £30-£50. (DDG found no data on the income of Victorian rag-and-bone men specifically.) So when the article says: > To do so was punishable with a fine of £50 (approximately US$65), which at the time was a substantial sum of money. The "approximately US$65" is only meaningful at the December 2023 exchange rate, and "substantial" is carrying all the information and doing a poor job of it. But the important, comparable thing is that it was on the order of his annual income. It might be more accurate to say that it would be comparable to fining a British person the median household income of £32,300 [4] or an American $74,580 * 0.75 = $55,935 (after taxes) [5]. Quality of living, cost of services, and various baskets of goods were more or less expensive at different times, so there are certainly additional comparisons or modifications you could do. I'm not much of a historian, but when I want to understand how much of a disincentive the fine was to a rag-and-bone man, that is a start to the kind of context I need. I don't have the context for the savings or borrowing power available to a Victorian laborer - did most people have savings accounts, an estate, retirement account, or other assets they could draw on? Did the government run installment agreements, or did a convict have to borrow from a bank and repay the loan over time? Were they just thrown in a debtor's prison until their family and friends paid the fine? I don't know. Regardless, it wasn't equivalent to me imagining a loss of $65. [1] http://www.afamilystory.co.uk/history/wages-and-prices.aspx http://www.afamilystory.co.uk/history/wages-and-prices.aspx [2] https://www.victorianweb.org/economics/wages.html https://www.victorianweb.org/economics/wages.html [3] https://www.victorianweb.org/economics/wages2.html https://www.victorianweb.org/economics/wages2.html [4] https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/householddisposableincomeandinequality/financialyearending2022 https://www.ons.gov.uk/peoplepopulationandcommunity/personal... [5] https://www.census.gov/library/publications/2023/demo/p60-279.html https://www.census.gov/library/publications/2023/demo/p60-27...