In An Era Of Inflation, Gold Still Reigns Supreme

 

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Content from Infographic - In An Era Of Inflation, Gold Still Reigns Supreme

$0.06 in 1922 has the same buying power as $1 in 2022

Inflation Is Taking A Toll On The Dollar. In 2022, Inflation rose 9.1%.The fastest pace since 1981.

 

Consumer prices are on the rise

 

July 2022 food index: 10.4% increase

July 2022 energy index: 41.6% increase

July 2022 all items less food and energy index: 5.9% increase and inflation isn't expected to slow down

 

In 2021, the US dollar depreciated:

 

16% compared to the Mexican Peso

16% compared to the Australian Dollar

12% compared to the Canadian Dollar

9% compared to the Euro, British Pound, & Chinese Yuan

 

Since 1933, the dollar has lost 99% of its value against gold.

The Value Of The Dollar Has Dropped For 100 Years—But Not The Value Of Gold

 

1920s

Glamor and wild spending defined the era. Cost of an oz. of gold: $20.67

 

Item - 1 Gallon Of Milk

Dollar - $0.69

Gold - .0334 ounces

 

Item - College Tuition Per Year

Dollar - $300

Gold - 14.51 ounces

 

Item - A New Car

Dollar - $260

Gold -12.58 ounces

 

Declining funds reduced average prices by an equivalent amount. Deflation increased debt, distorted decision making, reduced consumption, increased unemployment, and bankrupted people and companies.

 

1930s

 

Cost of an oz. of gold: $20.67

Item - 1 Gallon Of Milk
Dollar - $0.56
Gold - .027 ounces

Item - College Tuition Per Year
Dollar - $400
Gold - 19.35 ounces

Item - A New Car 
Dollar - $600
Gold - 29.03 ounces

1940s

The economy begins to stabilize. Cost of an oz. of gold: $34.50.

Item - 1 Gallon Of Milk
Dollar - $0.52
Gold -.0150 ounces

Item - College Tuition Per Year
Dollar - $329.82
Gold - .56 ounces

Item -  New Car 
Dollar - $850
Gold - 24.64 ounces
 

The end of WWII saw the cost of everything nearly double.

 

1950s

Cost of an oz. of gold: $40.25.

Item -  1 Gallon Of Milk
Dollar -$0.82
Gold - .020 ounces

Item -  College Tuition Per Year
Dollar - $625 
Gold - 15.52 ounces

Item -  A New Car 
Dollar - $1,510
Gold - 37.52 ounces

1960s

The first decade where a dollar can’t buy a gallon of milk. Cost of an oz. of gold: $36.50.

Item -  1 Gallon Of Milk
Dollar - $1.04
Gold - .038 ounces

Item -  College Tuition Per Year
Dollar - $1,250
Gold - 31.13 ounces

Item -  A New Car 
Dollar - $2,600
Gold - 71.23 ounces

1970s

The economy attempts to level out. Cost of an oz. of gold: $38.90.

Item -  1 Gallon Of Milk
Dollar - $1.32
Gold - .034 ounces
 
Item -  College Tuition Per Year
Dollar - $2,350
Gold - 60.41 ounces

Item -  A New Car 
Dollar - $3,450
Gold - 88.69 ounces

1980s

Inflation hit an all-time high of 14.5%—the worst in history up to that point. Cost of an oz. of gold: $594.90.

Item -  1 Gallon Of Milk
Dollar - $2.80
Gold - .004 ounces

Item -  College Tuition Per Year

Dollar - $6,000
Gold - 10.08 ounces

Item -  A New Car 
Dollar - $7,200
Gold - 12.10 ounces

1990s

Average consumer prices soar—especially college tuition. Cost of an oz. of gold: $386.20.

Item -  1 Gallon Of Milk
Dollar - $4.44
Gold - .011 ounces

Item -  College Tuition Per Year
Dollar - $13,420
Gold - 34.74 ounces

Item -  A New Car 
Dollar - $16,950
Gold - 43.89 ounces

2000s

The value of the dollar continues to diminish. Cost of an oz. of gold: $272.65.

Item -  1 Gallon Of Milk
Dollar - $2.78
Gold - .010 ounces

Item -  College Tuition Per Year
Dollar - $22,682
Gold - 83.19 ounces

Item -  A New Car 
Dollar - $24,750
Gold - 90.78 ounces

2010s

The upward trend continues. Cost of an oz. of gold: $1,900.00.

Item -  1 Gallon Of Milk
Dollar - $3.32
Gold - .00017 ounces

Item -  College Tuition Per Year
Dollar - $36,208
Gold - 19.06 ounces

Item -  A New Car 
Dollar - $31,352
Gold - 22.07 ounces

 

2020s

COVID-19 shuts down the economy—causing an unconventional recession. Cost of an oz. of gold: $1,787.55.

Item -  1 Gallon Of Milk
Dollar - $4.40 
Gold - .002 ounces

Item -  College Tuition Per Year
Dollar - $53,166
Gold - 29.74 ounces

Item -  A New Car 
Dollar - $42,872.63
Gold - 22.07 ounces

2030s

Runaway inflation rates suggest that $1 in 2020 will equal $0.65 in 2030.  Projected cost of an oz. of gold: $8,900.

Item -  1 Gallon Of Milk
Dollar - $6.38
Gold - .0007 ounces

Item -  College Tuition Per Year
Dollar - $77,107.34
Gold - 8.663 ounces

Item -  A New Car 
Dollar - $62,178.73
Gold - 22.07 ounces
 

“When paper money systems begin to crack at the seams, the run to gold could be explosive.” — Harry Browne, American writer, politician, and investment advisor

Why is Gold So Valuable?

●      Lower risk

○      Gold is one of the few investments with 0% counterparty risk

○      Probability that the other party will default on their obligations

●      Tangible ownership

○      Precious metals cannot be reduced in value by mass printing

○      A set amount of 244,000 metric tons exists on earth

●      Increasing value

○      Gold saw a 101.1% surge in interest during the 2008-2012 recession

○      This means more investors poured their money into gold, increasing its value

●      Higher interest rates than traditional savings accounts

○      Gold had a 24.6% investment return rate in 2020

○      The stock market investment return rate in 2020 averaged just 18.4%

●      Stronger demand during economic strife

○      1 in 6 Americans bought gold or precious metals in 2020

○      Worldwide gold investment demand jumped 80% YOY in 2020

 

History doesn’t repeat, but it often rhymes. To protect your bottom line, go for the gold.