by Brad Sebion, Moneyandtrading.com, SGT Report:
In recent weeks, I had the opportunity to page through a Sears Catalog from 1902. This phone book sized piece of history was an eye opener. From the items that no longer exist, to the cheap price tags attached to everything, this was the Amazon of its day.
Who wouldn’t want a cheap buggy for twenty two dollars? If you were big timer, you could roll down the street in one worth thirty five, and have a cover over your head. A couple items in particular that caught my attention were men’s suits and guns.
In 1902 you could buy a fine men’s suit for five dollars. With one twenty dollar gold piece, you could buy four of them. Keep in mind; a twenty dollar gold piece (1oz of gold) and a twenty dollar bill were interchangeable. Today that piece of gold would be valued at $1350. If you walk into Men’s Warehouse, and are looking to buy a suit of some quality, purchasing a three hundred and forty dollar suit would be the equivalent of buying the five dollar suit when measured in gold. The same goes for gun purchases.
A single barrel shot gun was priced at six dollars. Again, when priced in gold, that would buy you the equivalent of something worth four hundred dollars today. I’m sure you could walk into a big box store and buy a gun at that price. The same was true with hundreds of items listed throughout the catalog.
Gold holds its value, and will continue to do so in the future. I understand why “traditional” money managers steer clear of it, as there is no monetary incentive for them to hold gold. I believe that will change if negative interest rates begin to set it. It’s ironic, that central banks around the world continue to hold and add more gold as this paper currency experiment for the past forty five years continues to unravel.
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