Monday, September 3, 2012

Thought for the day:

In 1920 thanks in large part to ever increasing manufacturing efficiencies the base price of a Ford Model T was $260 (according to Wikipedia).
The dollar was backed by Gold at an exchange rate of $22 per Ounce Troy (oz/T).
So the cost of the car was 11.81 ounces Troy if paid for in gold. 

The invoice price of a base 2013 Ford Fusion is $20,235  (according to Edmonds)  The dollar was taken off the Gold Standard in 1971 by Executive Order signed by Richard Nixon.  Today the spot price of one ounce Troy of Gold is $1693.70 (according to Kitco).  So the cost of the car is 11.94 oz/T if paid for in Gold.

And you get more car for your gold…  Of course we’re not really talking about Fords.  We’re talking about fiat…  You see, gold is not over priced - the dollar is circling the bowl.

What’s that whooshing sound I hear?

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