On a recent trip to Sydney I visited the Reserve Bank of Australia's Museum of Australian Currency Notes. From the displays comes the following interesting information about prices in "the 1900's":
6 shillings a week for meat
16 shillings a week for groceries
25 shillings a week for rent
£250 for a Model T Ford
House equal to 10 times annual earnings
During war years average weekly earnings were £3
Given that there are 20 shillings in a pound and a pound is equal to a sovereign, which is equal to 0.2354 ounces, we can convert those prices at say AUD 1400 ounce into today's money:
$99 a week for meat
$264 a week for groceries
$412 a week for rent
$82,500 for a Model T Ford
$514,800 for a house
Of course this is a bit imprecise given the prices are as at "1900's" and wages are as at "war years", but it is a reasonable holding of value and certainly more than if one had just held on to paper money for a hundred years. See also this post on the same theme regarding the 1966 50c coin.
6 shillings a week for meat
16 shillings a week for groceries
25 shillings a week for rent
£250 for a Model T Ford
House equal to 10 times annual earnings
During war years average weekly earnings were £3
Given that there are 20 shillings in a pound and a pound is equal to a sovereign, which is equal to 0.2354 ounces, we can convert those prices at say AUD 1400 ounce into today's money:
$99 a week for meat
$264 a week for groceries
$412 a week for rent
$82,500 for a Model T Ford
$514,800 for a house
Of course this is a bit imprecise given the prices are as at "1900's" and wages are as at "war years", but it is a reasonable holding of value and certainly more than if one had just held on to paper money for a hundred years. See also this post on the same theme regarding the 1966 50c coin.
Indeed Bron. Goes to show not only is it a great holder of value but an excellent measuring tape of value. Also as per one of my earlier comments - based on median prices, one needed more gold to buy a house in 1970 than today! Those huffing and puffing about Oz RE... shouldn't it be at least double the amount of gold bars needed if the value had indeed gone up? In 1970 (1oz gold was $50 vs. median $20,000), today (1oz gold $1,320 vs. median $500,000).
ReplyDeleteAny thoughts on this piece from FT-A:
ReplyDeletehttp://ftalphaville.ft.com/blog/2010/07/12/283141/a-gld-contango-strategy/
I'll do a blog on that article, so many holes. I wouldn't want her managing my money.
ReplyDeleteI await the update with bated breath.
ReplyDeleteTo be fair (up to a point), she's a journalist, not an asset manager.
Still, if the story doesn't square, that's on her.