11 votes

The Power to Create Money: In 1971, the average new home was $25,000 or 714 oz of gold. Today, it is $256,900 or 174 oz of gold

By SoundMoneyCampaign :

(and that's taking into account the recent gold price suppression)

Your purchasing power in gold since 1971...

714 / 174 ~= 4.1

... thus, was multiplied by 4.1

(i.e., the ugly truth in crude math to ponder about...

put otherwise: how to buy four of the same homes - yes: 4 - "for the price of one", so to speak and, well, with gold, anyway...)


http://youtu.be/tZ7YYCqzKQc



Trending on the Web

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
SteveMT's picture

The power to debase fiat money.

In the final analysis, that is all that these cartels can do, print money. They can also make life miserable for the rest of us. Waiting while they destroy their grotesque fiat creation is the real tricky part. How do we prevent these bankers from ever doing this again? I can think of a few permanent ways. Thanks for this story.

New Headline: AMERICANS WEALTHIER

If you believe in a gold standard, what you are really saying is that homes are cheaper now, by a factor of three (including the corrections of the prior post). If I were to believe it I would have to do research but I would guess factors might include: (1) devaluation of home value by increased property taxes (monthly payments include more taxes); (2) illegal labor; (3) prefab construction; (4) still historically cheap home prices; (5) hmmmm someone find a 5th reason!

The official gold price in 1971 was (and still is) $42.22 per

ounce.

The math above then would be slighlty over 592 ounces of gold for a $25,000 house.

But the Census Bureau doesn't report that $25,000 figure.

It shows only $17,000. That's just over 402 ounces. (http://www.census.gov/hhes/www/housing/census/historic/value...)

I don't have figures for 2012 or 2011 home prices, but most numbers I see are near $185k, which by today's spot would be about 125 ounces or about a 73% decline in home prices over the last 40 years.

I say "bullpoop."

For U.S. citizens, gold had NO price in 1971. From Roosevelt's gold grab in 1933 up to Aug. 1974, it was not legal for private U.S. citizens to own gold bullion at all. Nixon allowed the dollar to "float" against gold in 1971 for international trade, but gold ownership remained verboten until late 1974. Source here.

So what "price" is the video assigning to gold in 1971? The "official" rate of $32/ounce, at which gold was NOT actually being sold? I bought my first gold coin in 1974, and it cost around $220. At THAT price it would only take 113 oz. gold to buy a $25,000 house.

Recommended reading: The Most Dangerous Superstition by Larken Rose

Cyril's picture

Thanks for sharing. Then you just brought even more water

Thanks for sharing. Then, you just brought even more water to the mill for the point made in their video.

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius

I'll have to visit their site. I hope they help make progress.

Most people are fooled by nominal amounts of money.

Even If You Adjust 4 Inflation

...why in the world should homes still cost as much? Advances in technology and productivity should have resulted in much more affordable homes. Hand saws and hammers gave way to power tools. Building materials are also created with much less labor and improved efficiency.
Consumers should have benefited from these changes long ago, yet we continue to overpay to put roofs over our heads.

You're right. The only

You're right. The only things I see that has improved in quality with houses is efficiency in terms of insulating and heating/cooling. Walls are thinner and ceilings are not as tall. Seems kind of backwards. People have gotten taller over 100 years yet our ceilings have dropped. Houses are built like crap these days, and it's absurd that their prices rose along with inflation. Doors are basically balsa wood and drywall is usually ⅜". People were able to buy houses 50 years ago. Now they must take out a 30+ year mortgage and still struggle to pay that. I don't buy it. Why would I want to pay twice the cost of something just to not own it anyway?

Please come join my forum if you're not a trendy and agree with my points of view.

Because "house" is a moving definition

Back then it didn't include A/C, granite counters, cherry cabinets, double stall garage with opener, landscaped plants and bushes or many other little conveniences of today.

When those are figured in, they increased the house cost by about what the tech advances have decreased the base house cost so it's been kind of a wash.

The take-away from this should be the inflation of money has quadrupled the entire market's worth "when measured in dollars" in 40+ years. It's gone up about 25 times in 100 years. But we really don't measure things in dollars as much as we do in hours of labor. Dollars are a moving place holder.

The worst part is that wages haven't kept up. Due mostly to the banks' role in finding ways to rob us (way too many to list here), we've been hit on both ends in that game. Our gross salaries have fought "efficiency" competition so they didn't climb while at the same time, our compulsory expenses (from taxes to buying services that used to be free to planned obsolescence) have risen. The century's track record is not as bad as the last 30 years but even after accounting for increased standard of living, we're still 4 times under water overall.

Cyril's picture

Maybe an entire century lost

Knowledge, science, and technology should have brought more peace, stability, prosperity, and happiness on this planet. Or at least in a few places giving the example to others, like once the USA.

What do we see instead?

More misery, more injustice, more greed, more envy, more immorality, more wars and more hatred, more hazards of all kinds.

Thank you, big governments.

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius

It's 151 oz., not 174 oz.

It's 151 oz., not 174 oz.

Please come join my forum if you're not a trendy and agree with my points of view.

Cyril's picture

I adjusted on purpose to the current gold spot price

I adjusted on purpose to the current gold spot price of $1,470ish/oz, instead of the $1,700/oz the video seems to take as a basis.

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius

Radio Show yestereday had financial "experts"

recommending selling gold and buying stock.

LOL, what stupid advice.

I was at my parents house

I was at my parents house with my grandmother a few weeks back and we got into an argument about politics, economy, rah rah rah. My GF was involved also. She brought up the minimum wage and how people cannot survive on it. Currently the minimum wage is $7.25 and people want it raised, etc. The argument started about prices rising and salaries not keeping up. I stopped the argument and told them I worked for minimum wage in high school for $5.15, my girlfriend worked for $7.25 in college for a bit. I asked my dad how much he was paid at his first job, he said $1.25 an hour. Finally I asked my grandmother how much she earned at her first job, she said she made $.35 an hour.

I asked them if they noticed anything strange about that. The work, labor, and product had not changed yet the price had gone up.

Southern Agrarian

Another interesting way to look at it

is that wages back then were just under 1/4th of now.

1971
It took 714 oz to buy a house but we earned roughly 302 oz per year.
This means we worked for 2.3 years to pay the principle off.
2013
It takes 174 oz to buy a house but we earn roughly 27 oz per year.
This means we now work for 6.4 years to pay the principle off.

This probably is a main reason it takes two incomes now to buy a house while making ends meet. Any way you look at it, our labor has been stolen.

Other 1971 events I ran across:
Average Income per year $10,600.00
Average Monthly Rent $150.00
Cost of a gallon of Gas 40 cents
Datsun 1200 Sports Coupe $1,866.00
United States postage Stamp 8 cents
Ladies 2 piece knit suites $9.98
Movie Ticket $1.50

U.S. Sylmar earthquake hits the San Fernando Valley area of California. (I remember getting tossed across my bedroom as if it was yesterday!)

Peru Peru Earthquake results in the destruction of the town of Chungar, Peru, and the death of most of the towns people

UK Decimalisation in United Kingdom and Ireland both switch to decimal currency.

UK Education Secretary Margaret Thatcher's ( "Thatcher The Milk Snatcher". ) ends free school milk for children over the age of seven in the UK

UK IRA Bomb Post Office Tower in London

U.S. The Voting Age in the United States is lowered to 18 yrs old when the 26th Amendment to the US constition is ratified

U.S. Harris public opinion poll claims that 60% of Americans are against the war in Vietnam

India Tsunami in the Bay of Bengal in Orissa State in India kills 10,000.

U.S. The Walt Disney World Resort opens in Florida on October 21st

World Greenpeace formally comes into existence.

U.S. Federal Express is started by Fred Smith

UK Thousands protest against the British government's new industrial relations Bill.

Australia Australia and New Zealand Announce Pull Out Of Troops from Vietnam

U.S. Cigarette Advertising Ended on Television in USA

Scotland A fatal stampede at Glasgow Soccer Game

U.S. In an attempt to control inflation President Richard M. Nixon implements 90 day freeze on wages and prices, he also removed the gold/silver backing from the US Dollar

Uganda Major General Idi Amin takes control of Uganda soon to become one of the worst and most notorious dictators of modern times

UK Following Public Concern Over Immigration in the UK, a new Immigration Bill stops Commonwealth citizens automatic entry

U.S. Following on from the Public Broadcasting Act of 1967, National Public Radio (NPR) broadcasts for the first time in April 1971

Northern Ireland Problems in Northern Ireland continue as rioting increases as part of the IRA campaign to end British Government Rule.

U.S. The New York Times begins to publish sections of the Pentagon Papers showing the US Government had been lying to the American People.

Quatar Qatar Gains Independence From Great Britain

Sierra Leone Sierra Leone Gains Independence From Great Britain

U.S. Charles Manson and three of his followers receive the death penalty

The world lost Jim Morrison but got Led Zepplin IV, Love Story, Lance Armstrong, Mariah and Tupac. We were also first introduced to microprocessors, email, chat rooms, floppy disks, pocket calculators, LCDs, CAT scans and Kevlar.

All I know is that I sure wasn't paying as much attention then (age 6) as I do now!

Cyril's picture

Yes, exactly.

Yes, exactly. Thanks for the refresher. This is how I now force myself to think. Not in terms of fiat money amounts, but in terms of purchasing power and cost of life for the time we spend working.

Governments fiat monies have clearly failed justice and honesty-wise. They have succeeded however to enrich the cronies of all types.

Also, on taxation, if Americans think if it's bad here, it is, but I also invite anyone to try make a good living in Europe, esp. Spain, Greece, or France, to get a real taste of what plunder by taxation can feel, for both employees and employers side. This is quite astounding to me that people can even find it acceptable, still, without revolution and not putting the frauds who rule over them in prison.

This is what infuriates me most at times. That people are still coping with it, and either complain about it afterwards or ask for more of it. Mind boggling.

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius

All I see is that homes got 4

All I see is that homes got 4 times less expensive.

Please come join my forum if you're not a trendy and agree with my points of view.

... or gold got four times

... or gold got four times more expensive.

Ĵīɣȩ Ɖåđşŏń

"Fully half the quotations found on the internet are either mis-attributed, or outright fabrications." - Abraham Lincoln

uh..

yeah? care to explain that mathmatically; without using gold from 1970 that you have stockpiled? ;)

I use Blue Wave, but don't expect one of THEIR silly taglines.

Don't think in terms of

Don't think in terms of dollars. Gold has pretty much had the same purchasing power throughout history. Your recent $1,900 spike was artificial and the housing market is crap. The fact that the house decreased in gold value by 4 times means the housing market went south, not gold getting more expensive. The housing market and the dollar are part of the same scheme run by the banksters. It's not surprising. People are ending up paying twice the value over 30 years and they are having to pay rent on it. No one owns land, so it has no value anymore.

Please come join my forum if you're not a trendy and agree with my points of view.

The Money Supply Has At Least Quadrupled Since Then

...so I guess it makes sense. Though I'm under the impression that it doesn't work that cleanly (e.g. "everything rises 4x"). I think it'll be much worse because money will disproportionately flood into certain sectors causing much bigger jumps than 4x. But that opinion is from my layman's understanding of economics so do your own research (and educate me if I'm wrong!)

[by the way, it might have more than quadrupled but I have recently heard that word mentioned in relation to our money supply so I went with that]

Cyril's picture

Also, not even linear for the past two decades

Also, the base money supply hasn't increased linearly.

It grew faster in the 90s than from 1971 to the late 80s, and grew even faster in the 2000s.

It has overall gone a-wild since QE1, November 2008.

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius