Topic: The price of gas is still 20 cents, in 90% silver dimes. - page 3. (Read 7326 times)

On August 9, 1971, Richard Nixon closed the gold window. The dollar could no longer be converted into gold.

I understand that it is a complex issue and that wages were lower in the 1900s than they are now, but the decline in the purchasing power of the dollar still means something.  I want to learn more about the complex issues and discuss them with people.  I'm willing to discuss them with you if you are interested. 

Stuff like that is misleading.  There is FAR FAR more to the monetary control debate than "zomg the dollar is worth only a fraction of what it was!!!"  Charts like that designed to get an emotional reaction out of people that don't think.  Without even getting into details, just consider for a second that in 1900 people worked for pennies an hour.  So, yes, the dollar was worth more, but that's only a tiny part of the story.  You can't just look at relative value of a dollar and ignore all other factors.

Certainly gold and silver prices fluctuate versus currencies and commodities just like everything else on the market.  The argument against fiat is that having a currency pegged to gold and silver makes your currency much more stable and decentralizes the control of the currency.  Fiat currencies are controlled by the central bank which can inflate at will ruining your savings and destroying the purchasing power of the dollar. 

For example, here is a chart of the purchasing power of the US dollar from 1792-2011.  Note the dotted lines where we went off "hard currency".



http://www.wealthwire.com/news/inflation/773

I just explained to you why averages are meaningless and actually ridiculously misleading in many cases.

The chart is inflation corrected, so it shows the actual cost of oil and the fact that it is NOT steady, as you said.  I understand what you said perfectly.  Your argument is that silver maintains a constant value (untrue), oil priced in silver has been the same price since ever (untrue), therefore oil price fluctuations should be attributed almost entirely to the value of the dollar (untrue).

Oh, I'm sorry, that's a dollar chart!  I thought you had actually posted something relevant to a topic for once!  I should have known better.

I already stated that I'm talking about the average across years, not the spikes; and relative to silver, not US FRN.  Of course, I shouldn't expect you to actually read any posts that precede yours. that not being your style of debate.

We haven't?  We must not be looking at the same chart.  I see a low price of $10 and hit a high of ~$150 (so about $130-140 conservatively corrected to 2006 dollars for that chart).  So you're right, we haven't had 500% price fluctuations, we've had more like 1,500% fluctuations.

Shit man, we've had price swings range from $140 to $35 within the last decade.

We haven't had 500% price fluctuations over the past 120 years.  Oil was first discovered in 1861, the first 20 years mostly involved finding a use for it and then developing the tech to get it out of the ground.

And if you don't think that the 10 residents of that town that make $1000 per year are better off than you are, then you have no concept of reality.  The adult children of the wealthy residents don't make anything in the real world, but I'd wager that you would rather be them then their hard earning father.

And that idiotic conclusion makes as much sense as looking at a town in which 10 residents make $1mil/year and 10 make $1,000 year and then going around telling people that the town is well off because the average income is $500,500/year.  Or it's like telling someone a hiking trail is flat because the starting and ending elevations are the same... totally ignoring the fact that it's got +/- 6,000ft. of elevation change in between.

A flat trend line doesn't mean a damn thing when we've had 500% price fluctuations over the years.


Furthermore, if you extend it up to 2011, the trend line is no longer flat.  That chart doesn't show the run up to $140+ and it doesn't show the following crash to <$40.  It doesn't include the years following that crash in which it's never seen sub $80.  The trend is clearly UP.

Demolish me?  You just proved the point.  The trendline of that chart is flat for the past 120 years.

I like gold and silver but I agree with AyeYo (for once?) that they are not a magic measuring stick of value. You can presuppose that gold's "value" is constant and that it's the values of everything else that fluctuate in relation to it, but that's just a game of semantics. On the other hand, we all know that paper money doesn't just fluctuate over the long term but also gradually approaches zero buying power in most cases. Almost any commodity metal is better than that as a long term store of value, but many of them take up a lot more space per unit of value than silver and gold do.

Yea bro, the price of oil is definitely steady when adjusted for inflation...




It's so easy to demolish you with simple and easy to find facts and numbers.


Someday the gold bugs will realize that gold is not the holy grail of absolute value.   It's a commodity (a shitty one at that) and fear investment whose value fluctuates significantly based on speculation.  Silver is even less reliable as a constant store of value, as even a passing glance at a silver price chart will show anyone with working eyes.

Well it would be nice to have the silver out of them without them being us currency

There is no need to, and if there ever was a need to do so, that law is going to lack force without a functional government.

That's awesome. It's not like you can legally melt down the coins though, which sucks.

There will come a day that supply finally peaks worldwide (and this might have already happened, but demand is also down from 2007) and then the cost of energy is going to rise.  We are not there yet, however; so (due to the competitive nature of oil refineries) so the primary contributers to the cost of a gallon of gas are 1) production & shipping and 2) goverment taxes.  Usually in that order, but I believe they are reversed in parts of Europe.  Middle Eastern dictators make a fortune from exporting oil (primarily) because they pay local skilled labor wages that are lower than they would be in the US or Europe while charging slightly less than the cost of production for those same regions (those that still have oil, anyway).  The proven reserves of oil in the US are higher than those of Saudi Arabia, but those are not "economicly viable" reserves so long as the Saudis can provide oil cheaper.

Thus, the cost of a gallon of gas has been fairly stable (measured over months to years, not days) when viewed relative to either silver or gold.  I admit the article is biased, and so am I, towards silver.  Gold would probably have been a better comparison.  Yet, the point stands.  Inflation isn't the prices rising, it's the value of the currency dropping.  Gold and silver both (tend) to reflect that debasement in their spot pricing, over the long term.

there is a lot to hate about fiat, but I hate this constant misleading twaddle.

as mentioned you didnt earn that much back then.

silver is also way higher now than in the 90s.. so you are cherry picking.

gas is a limited resource, it really doesnt matter your comparison, GAS IS GETTING MORE EXPENSIVE AND IT HAS NOTHING TO DO WITH FIAT(well ok there is a fiat component but there is also a supply and demand component) and when you use gas, it goes away, unlike when you use gold.


This is nothing more than twaddle designed to mislead

This is not so.  Fractional reserve banking doesn't work like you think it would work.

If nobody would bring their surplus dollars (savings) to the banks, those banks wouldn't have any leverage (other than their own private capital) to emit loans and inflate the currency on, so their wouldn't be any inflation at all. It's the peoples' fault to trust the banks with their own money, giving them the opportunity to debase the currency.

lulz

So when silver was $5/ounce a decade ago, was gas still 20 cent per gallon?  How about all the people that loaded up on silver during the 1970's price spike?  That worked out really well for those people. lulz


Also, biased article is biased.  He starts and stops the chart on price spikes and calls the area in the middle (the normal price of silver) a spike down. LOL  Here's a full silver price chart:




Minus the BUBBLE price increases in the 1970's and at present, silver has spent the other 98% of the time trading at $5/ounce or less.