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Letter Re: An Economic Observation on the Prices of Silver and Gasoline Versus Fiat Dollars
Jim,
I hope all is well with you and yours! I am pleased to note that I have made
faithful followers of your blog of many of my friends. The more the merrier!
The blog has been an incredible source for enlightenment and inspiration.
I now advise everyone that I can prove that since 1964 and based upon the 1964
monetary system, the gallon price of gas at the pumps and the relative price
of consumer goods have not increased in cost or value. Only
the Federal Reserve note has lost buying power. In my humble and simple observation,
cost or value
are mere reflections of each other and are not necessarily defined by mediums
of exchange, as in fiat vehicles we all call 'notes'. Allow me to explain.
In 1964, the price of a gallon of gas was +/- .21 (twenty-one cents). An automobile
nicely proportioned was $2,000 (two thousand dollars).
In 1964, silver coinage was the norm; however, the Federal Reserve and its
cronies in "guv'memt" plotted silver's demise as a free market trading
medium and standard.
Today, fuel is $4.00 (four dollars) per gallon. A really nice car costs $40,000
(forty thousand dollars).
But the cost or value of fuel and consumer goods has not really
increased. In 1964, a silver American dollar, the standardized value of exchange
for the
United States of America, equaled the cost of nearly five gallons of gasoline.
Today, a 1964 'junk silver' Morgan (1921 or earlier) dollar will fetch $20.00
(twenty dollars) in Columbia, Tennessee. That 'exchange rate' for fiat currency
reflects
that
still nearly five gallons of fuel can be purchased for the same value. Now,
divide that cost of a $40,000 (forty thousand dollar) automobile by $20 (twenty
dollars) and one readily observes that the cost or value of this consumer good/want/need
has really not changed as it still costs 2000 (two thousand) 1964 silver ounces
or 'dollars'.
I do note, however, that one should not confuse the notion of intrinsic value
with perceived value.
What has changed, though, is the great deception upon which the American citizen
has been saddled, the wholesale fleecing of the wealth of this country! If
everyone who reads your blog would recognize the stability of precious metals
and adjust their way of defining cost or value they might find direction in
their economic travels. More so, recognizing the grim realities of the Federal
Reserve's economic policies, one should be able to read the writing on the
wall. Sadly, we exist today economically on the 'oil standard' which oddly
enough is a reflection of the old 'gold/silver standard'. Now all can stand
on the street and point out that the King of the Federal Reserve is wearing
no clothes!
When I point out to my friends the observations noted, they take great pause
and likely start buying up 'junk silver'. Precious metals really don't 'increase
in value', they just don't lose purchasing power by government inspired inflation.
OBTW: Thanks for the heads up on 'The Alpha Strategy'. -
Matt in Tennessee
