Thu, Feb 16, 2012 - 2:53am
I was talking to my friend today about PM's and I told him that gold and silver retain their value and gold is inflation proof and its not so much that Pms rise as much as it is that the value of the dollar drops. So I compared a silver dime in 1964 to today , and told him that the silver dime bought a gallon of gas in 64 and can still do so today.
Later on it got me to thinking,and I applied same formula to gold. I took spot price of gold in 1970 which was 38 an oz and compared it to the average cost of a car in 1970. $3900
and figured it took 102 oz of gold to buy an average car in 1970
So I multiplied 102oz of gold by todays spot price of 1700 and got $$173,400
The average home in 1970 was 24,000 divided by ounces of gold @ $38 which was 631 oz of gold to buy the average home.
plugging in the same info from todays spot price and multiplying by 631, I got 107,2700 for the cost of the average home today. which is obviously not correct so my question is what made gold so much more expensive than silver or cash in percentile?
Why the big difference in gold???
What Im saying is silver has maintained its ratio to goods since 1970, but gold exceeded its good to ounce ratio by a huge margin . I dont understand .
Edited by: Hold over on Nov 8, 2014 - 5:30am