When you're riding in a car the houses and trees outside the vehicle appear to be whizzing past rapidly while you stand still. Of course, every adult knows that the apparent movement of the objects outside the car is only an optical illusion. The motor vehicle in which you're riding is moving. The scenery is actually rooted fast. The driving analogy above is ideal for describing the inflation of prices in US fiat money (US Dollars). It is not the prices of food, fuel, etc., that are continually moving upwards, it's the value of the US paper Dollar that is plummeting downwards!
To prove my price inflation assertion, let's look at everyday prices on items from 1940 and 2010. All costs will be computed using US 90% silver coins (dimes, quarters, halves) that were minted for circulation up to and including 1964. Coins minted after that date for circulation were made from base metals and fall under the heading of fiat money (money that has no value outside of the government mandated value).
Average Cost Gallon Of Gas
1940 $0.11 cents
2010 $2.75
Present Value $0.11 cents silver money $2.97
Average Cost Loaf of Bread Food
1940 $0.10 cents
2010 $2.79
Present Value $0.10 cents silver money $2.70
Average Cost 1lb Hamburger Meat
1940 $0.20 cents
2010 $3.99
Present Value $0.20 cents silver money $5.40
You can see from the price information above that if you'd saved your 90% US silver coinage since 1940, you could still buy these everday items for the same amount based on their silver content value! In other words, the "real prices" of these items has really stayed relatively the same. The only reason that inflation has appeared to cause prices to rise is that the actual buying power of the US Federal Reserve Notes un-backed by precious metals has dropped precipitously.
There are exceptions, of course, to the above rule. Although housing prices have been battered by the recession, they're still hovering above their 1940 silver coin equivalent. The price of a new car is likewise further ahead than its equivalent in 1940 silver coins. However, I expect these exceptions to be liquidated in the future as silver continues to rise versus the empty shell that is the US Dollar of today.
So, the next time you fill up with gas, don't give the gas station attendant a hard time. Remember, it's the Federal government with its money printing presses flooding our economy with worthless greenbacks that you should direct your anger towards.
Time is running out fast! Hyperinflation seems unavoidable as fiat paper money is being printed as fast as the US presses can run. To protect your wealth and your family, buy gold and silver now from these top companies, APMEX Gold and Silver and Silver American Eagles.
Rick
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