Close X Cookies are necessary for the proper functioning of 24hGold.com. By continuing your navigation on our website, you are accepting the use of cookies.
To learn more about cookies ...
EnglishFrench
In the same category

Economy Haunted by ?Ghost of Inflation Past?

IMG Auteur
Published : February 12th, 2013
631 words - Reading time : 1 - 2 minutes
( 2 votes, 3/5 )
Print article
  Article Comments Comment this article Rating All Articles  
0
Send
0
comment
Our Newsletter...
FOLLOW : Tragedy
Category : Opinions and Analysis

[Fifty years of inflation has been tough on households, but for millions of college grads unable to find work paying more than $10 an hour, it can be defeating. In the guest essay below, Rick’s Picks forum regular John Skerencack (aka John Jay) explains how an economic tragedy that has trapped young people took shape without anyone much noticing. Until now. RA]

A good way to work a scam is to put a microscope on a short-term trend and pretend it is a reversal of the main trend. “Global Warming,” for example. About 15,000 years ago there was a sheet of ice 5,000 feet thick over New England. As the ice age ended it melted away, and as a result sea levels rose about 390 feet. So you can say with confidence, the long-term trend is melting ice, and rising sea levels. All this happened without any human input at all — a mile of ice melts, sea levels rise 390 feet. Now, in the past 140 years, more ice has melted, and sea levels have risen about a foot.

OMG! Quick, let’s create a global tax expressed through carbon credits to stop it before it gets out of hand and we all drown! Al Gore and the CME have a plan to save us! Cue the one minute chart of sea level rise! You get the picture? There is no new trend of rising sea levels, just the last gasp of the main trend, most likely.

Rising Seas = Inflation

Turning to the “Dismal Science,” the rising sea levels of the past 50 years or so is Inflation. So ceteris paribus, let 50 years be equal to the 15,000 years of melting ice and rising sea levels. For the sake of argument assume the price of everything has gone up 1,000% since 1963. Further assume that wages over the same time have gone up 400% These are very rough numbers, but brevity is essential to keep your attention, and I am excluding government workers who are getting raises unknown in the private sector. And I am assuming the wages are for an average guy or gal, not an MD or physicist. So I won’t even bring up college tuition increases in the past 50 years.

So a young guy or gal in 1963 would be making $5,000 a year and paying $20,000 for a nice house and $2,000 for a nice car. And a postage stamp was 5 cents. I am using $5,000 a year because I remember as a freshman in high school a teacher telling me he was leaving teaching to sell insurance because he could not make it on $5,000 a year. In 2013 a young guy or gal is making $20,000 a year, and a house is $200,000 and a car is $20,000. And a postage stamp is 46 cents. (And no one is quitting a teacher’s job to sell insurance: see “Government Workers” above.)

Wages Failed to Keep Up

Can you see the problem the young people are facing? They are haunted by the “Ghost of Inflation Past” because they are living in an economy ravaged by 50 years of inflation, in an economy of $10 an hour jobs thanks to open borders and off shored jobs. Wages never kept up with inflation in the private sector, not even close. So when Ben says Inflation is contained at 2%, he is pointing to a one-minute chart where gas prices just went down 20 cents gallon.

Don’t believe it. Believe the rattling chains, and chilling moans of the Ghost of Inflation Past!

“Unquestionably, there is progress. The average American now pays twice as much in taxes as he formerly got in wagesH.L. Mencken

***

[Click here for a free trial subscription to Rick’s Picks that includes access to a 24/7 chat room and timely trading touts.]


<< Previous article
Rate : Average :3 (2 votes)
>> Next article
Rick Ackerman is the editor of Rick’s Picks, a daily trading newsletter and intraday advisory packed with detailed strategies, fresh ideas and plain old horse sense.
Latest comment posted for this article
Be the first to comment
Add your comment
Top articles
Latest Comments
The Crash of the Bank of the Uni...
01 Augsam_site
AN ASTOUNDING EXPOSURE What no one recognizes to this day is that the Fed stole America's gold and shipped it to Germany causing b...
Iran Agreement Boosts Peace, Def...
29 JulArtboard
A US Naval vessel shot down an Iranian Passenger Jet with 300 passengers, over the Persian Gulf on the 3rd July 1988, they mistook it for a Fighter...
Will Uncle Sam Confiscate Gold A...
31 Julovertheedge
"... , generally larger amounts would be safer stored in the safest vaults in the world and in the safest jurisdictions in the world." An...
Gold market liquidity and manipu...
29 JulPD
Bron, I was wondering if the planned Allocated Bullion Exchange (ABX) would have any impact on the liquidity of the Gold market. Would it not at le...
Is the gold price manipulated?
29 Juldanzas1231
This article is a joke. Please stop writing baseless garbage. There is enough real evidence of the things you're still calling conspiracy. GATA hav...
Is the gold price manipulated?
28 Julkeith952
... if one takes the dumping of an usually high tonnage of gold at an illiquid time in the gold market aka the Monday one week ago - then such 'b...
Gold Reserves and GDP: China is ...
30 JulWilliam Tan
Shakespeare was right; "The world is a stage." Unfortunately we have all the bad actors acting at once.
Iran Agreement Boosts Peace, Def...
28 Julsonora69
You have a point. The 2003 Iraq invasion is mostly now considered an ill-advised and unjustified destabilization, with regional & political consequ...
Most commented articlesFavoritesMore...
World PM Newsflow
ALL
GOLD
SILVER
PGM & DIAMONDS
OIL & GAS
OTHER METALS
Mining Company News
Vena Res.(Ag-Au-Cu)VEM.TO
Provides Update With Regards to the Arbitration Concerning the Azulcocha West Project and Enf
CA$ 0.04-35.71%Trend Power :
Exploration and drilling
Rockwell(Cu-Gems-Ni)RDI.TO
Announces Delay in Annual Meeting and Meeting Date
CA$ 0.20-2.44%Trend Power :
Corporate news
Eldorado Gold(Au-Fe)ELD.TO
Reports 2015 Second Quarter Financial and Operational Results
CA$ 4.50+11.39%Trend Power :
Financials
Endeavour Financial(Ag-Au-Co)EDV.TO
Mining Q2 2015 AISC/oz of $898, Profit of $33M And $20M Debt Payment in July
CA$ 0.51+8.51%Trend Power :
Corporate news
Mawson Res.(Au-Ur)MAW.TO
Restarts Drilling at the Palokas Gold Prospect in Finland
CA$ 0.17+6.25%Trend Power :
Corporate news
Goldcorp(Cu-Le-Zn)G.TO
Achieves Record Quarterly Gold Production; Updates 2015 Cost Guidance
CA$ 17.45+6.01%Trend Power :
Production
Claude Resources(Au-Cu-Ngas)CRJ.TO
Provides Date for Q2 Results and Conference Call
CA$ 0.65+3.17%Trend Power :
Corporate news
Richmond Min.(Ur-Au-Gems)RMD.V
- Exploration Update
CA$ 0.09+0.00%Trend Power :
Corporate news
Arianne Phosphate(Ur-Mo-Ti)DAN.V
Extends the Term of Warrants
CA$ 0.88+2.33%Trend Power :
Financings
Anaconda Min.(Au)ANX.TO
Reports 12.83 g/t Gold Over 4.38 Metres and 8.55 g/t Gold Over 4.97 Metres from Channel Sampl
CA$ 0.05+25.00%Trend Power :
Corporate news
Comments closed