Falling Prices: A recent article in MoneyNews from NewsMax.com states “Consumer Prices in Free Fall- Consumer prices have not been this low since 1949”. The article went on to say “That's the conclusion of the US Labor Department, which reported Thursday that, thanks to lower gas prices, the Consumer Price Index fell by 0.6% in November.” First of all the index actually declined by .8%, it was .6% on a “Seasonally adjusted basis” and secondly nowhere in the report released by the Bureau of Labor Statistics (part of the US Labor Department) did they come to any conclusions about anything let alone “free falling” prices. What they did state is that the majority of the decline was … [Read more...]
Hurricane Katrina: The Economics of Disaster
The Economics of Disaster: Are Hurricanes Inflationary or Deflationary? Insurance companies have estimated the damage from hurricane Katrina at $25 Billion Dollars. But the economic effect is much greater than that. That is just the loss of property. Another consideration is the loss of revenue while things are being rebuilt. What about the loss of jobs from the companies who won’t be rebuilding because they didn’t have insurance? According to the “Financial Times” current estimates of “total economic losses” are closer to $100 Billion. Those numbers are so large that it is almost impossible for us to get our minds around it. If you stacked 100 billion one dollar bills on top of each … [Read more...]
Affordable Luxuries?
According to the January issue of "Wired" magazine luxury items are more affordable than ever. They picked several items and adjusted their prices for inflation and found that in inflation adjusted dollars many luxury items cost less than the did 10 or 25 years ago. How can that be? According to "Wired" the price to charter a plane for an hour was $3,016 in 1980 but was only $1,850 in 2004, a decrease of 39% over 24 years. A BMW series 3 was $40,945 in 1995 and is $30,840 now a decrease of 25% over 10 years. Other prices they compared were Dinner at the 21 club $114.66 in 1987 and $87.50 in 2004 for a 23% decrease over 17 years. LaPavoni espresso machine $1,242 in 1975 and $550 … [Read more...]
Confederate Inflation Rates (1861 – 1865)
The Chart below shows the Annualized Confederate Inflation Rates. The Annual Inflation Rates are calculated from information provided by the Richmond Civil War Centennial Committee on the purchasing power of Confederate Notes. The table below shows the actual Confederate Treasury Note Inflation data that was used to develop this chart. The method used was to create an index setting January 1, 1861 equal to 100 and adjusting the following months to come up with an Inflation index figure for the first of each succeeding month by interpolating from surrounding months if necessary to fill in the blanks. Note that some months have additional Inflation data for the 15th of the month while … [Read more...]
Greenspan’s Comments on Inflation
Remarks by Chairman Alan Greenspan Financial education At the JumpStart Coalition's Annual Meeting, Washington, D.C. April 3, 2003 I am pleased to be here today to share with you my perspective on the importance of financial education. I commend the leadership of the JumpStart Coalition and the activities it has undertaken to support teachers working on the front-line of financial education. Trends in Consumer Finances As you are aware, today's financial world is highly complex when compared with that of a generation ago. An understanding of how to maintain a checking and savings account at a local financial institution may have been sufficient twenty-five years ago. Today's … [Read more...]
