Tuesday, January 12, 2016

Oil is back to Nixon prices,just after the monetary shock

Oil price  is a great indicator,  The price today is $30.

See what happened when Nixon dropped the helicopter load on gold bugs.  Oil shoots up, we get the severe 1982 recession.  Then, in 2008,  it peaks up, to the same, inflation adjusted value, and we get the great recession. Now we are back to 1972 prices, unadjusted.

What if pricing is neutral, and we retrace prices all the way back to 1976? 


We can look! Here it is:

Cost Of Living 1976
How Much things cost in 1976
Yearly Inflation Rate USA5.75%
Year End Close Dow Jones Industrial Average 1004
Interest Rates Year End Federal Reserve 6.25%
Average Cost of new house $43,400.00
Average Income per year $16,000.00
Average Monthly Rent $220.00
Cost of a gallon of Gas 59 cents
A few More Examples
Plymouth Arrow$3,175.00
Polaroid Camera $28.00
Mens Sports Jacket $37.15
Zenith 25" Color TV $599.00
CB Radio $147.00
Micro Wave Oven $169.00
Saint George, Utah
Perfect Home 4 bedrooms , living room with fireplace, large family room dining room , laundry, 2 1/2 baths on large plot $36,500 
So with deflation on the orizon, how does the dollar look? It is up. Sim ply holdi g dollars and you outperform sinc e over a year ago.  Only has Bitcoin exceeded the rise in value, and that only because it is used to move yuan from  communist clutches..



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