Price/Cost Indexes from 1875 to 1989
468 pages
English
Le téléchargement nécessite un accès à la bibliothèque YouScribe
Tout savoir sur nos offres

Price/Cost Indexes from 1875 to 1989

-

Le téléchargement nécessite un accès à la bibliothèque YouScribe
Tout savoir sur nos offres
468 pages
English

Description

Project Gutenberg's Price/Cost Indexes from 1875 to 1989, by United StatesThis eBook is for the use of anyone anywhere at no cost and with almost no restrictions whatsoever. You may copy it,give it away or re-use it under the terms of the Project Gutenberg License included with this eBook or online atwww.gutenberg.netTitle: Price/Cost Indexes from 1875 to 1989 Estimated to 2010Author: United StatesRelease Date: June 20, 2008 [EBook #88]Language: English*** START OF THIS PROJECT GUTENBERG EBOOK PRICE INDEXES FROM 1875 TO 1989 ***Price/Cost Indexes from 1875 to 1929byUnited StatesOctober, 1993 expanded for release in November, 1993[Originally published as a column entitled:THE RATE OF CHANGE OF THE RATE OF CHANGE by Michael S. HartIn The Electronic Journal of Virtual Culture]WHILE IT APPEARS THAT COMPUTERS ARE AN INCREDIBLE DEAL THEY ARE REALLY TWICE AS GOOD A DEAL AS IT SEEMS TO BECOMPUTERS INCREASED IN VALUE TWICE AS MUCH AS IT APPEARS SINCE THE FIRST CONSUMERHARD DRIVES BECAME AVAILABLE IN APPROXIMATELY 1979WHERE DOES OUR MONEY GO?Many of you are aware that the $3,000 you spent on computers last year could be replaced by $2,000 spent today.However, only recently have I actually purchased computer gear that I bought with dollars that were only half as valuableas those with which one of my drives was purchased in 1979.Many of you are aware that the average personal computer was $5,000 - $10,000 some 10 - 15 years ago when Applesand IBMs first ...

Sujets

Informations

Publié par
Publié le 08 décembre 2010
Nombre de lectures 26
Langue English

Exrait

Project Gutenberg's Price/Cost Indexes from 1875
to 1989, by United States
This eBook is for the use of anyone anywhere at
no cost and with almost no restrictions whatsoever.
You may copy it, give it away or re-use it under the
terms of the Project Gutenberg License included
with this eBook or online at www.gutenberg.net
Title: Price/Cost Indexes from 1875 to 1989
Estimated to 2010
Author: United States
Release Date: June 20, 2008 [EBook #88]
Language: English
*** START OF THIS PROJECT GUTENBERG
EBOOK PRICE INDEXES FROM 1875 TO 1989
***Price/Cost Indexes from 1875 to 1929
by
United States
October, 1993 expanded for release in November,
1993
[Originally published as a column entitled:
THE RATE OF CHANGE OF THE RATE OF
CHANGE by Michael S. Hart
In The Electronic Journal of Virtual Culture]
WHILE IT APPEARS THAT COMPUTERS ARE
AN INCREDIBLE DEAL THEY ARE REALLY
TWICE AS GOOD A DEAL AS IT SEEMS TO BE
COMPUTERS INCREASED IN VALUE TWICE AS
MUCH AS IT APPEARS SINCE THE FIRST
CONSUMER HARD DRIVES BECAME
AVAILABLE IN APPROXIMATELY 1979
WHERE DOES OUR MONEY GO?Many of you are aware that the $3,000 you spent
on computers last year could be replaced by
$2,000 spent today. However, only recently have I
actually purchased computer gear that I bought
with dollars that were only half as valuable as those
with which one of my drives was purchased in
1979.
Many of you are aware that the average personal
computer was $5,000 - $10,000 some 10 - 15
years ago when Apples and IBMs first appeared on
the scene, but you might not be aware of a trend
beyond the price reduction that makes today's
computer prices an even better bargain in
comparison.
In fact, computers today are TWICE as good a
bargain as they appear in comparisons with those
early computers, and it was already looking as if
they were bargains beyond all belief.
In earlier articles I mentioned the fact that today's
cheapy 486 DX2/66 computers were 100 times as
fast as the originals from IBM, and were likely to
also have 100 time as much hard drive storage.
[After all, the original PC didn't even have hard
drives, and still cost a fortune.]
Here are a few examples to jog your memory:
These are "bare bones" prices for the computer
systems; when filled out with color monitors,
printers, ports, modems, and the rest of an
average computer system, these prices usuallydoubled, and the prices I usually quote as modern
comparison figures include VGA, printer, modem,
mouse, and software.
1979 Konan 5M External Hard Drive Kit for Apples
$3,000 1981 PC-DOS CP/M 1-Floppy 128K-RAM
serial-parallel $2,000 1983 PC-XT added 3 slots
and 10M hard drive $3,600 1983 PC to XT
Upgrade kit with 5M ST-506 Hard Drive $1,500
1984 PC-AT 1.2M Floppy 256K-RAM no ports 3x
faster $4,000 1984 PC-AT Enhanced added 20M
hard drive no ports $5,800
[These two Hard Drive Kits both included the ST-
506 drives— but the Apple was External while the
IBM was Internal: both were from third-party
vendors.]
Back in those days extra floppy drives from Apple
or IBM for around $325 to $475 respectively [and
don't forget that many of these floppies were single
sided and held around 150K but we only tend to
remember the double sided floppies. If your
memory includes "flippies" you know what I mean.
(Flippies: single sided floppy disks which were
notched so you could do a "flip-over" with the
floppy, and use the other side, which was
supposed to be unusable but which in most cases
was just as good as the side you actually paid for.
Don't forget the floppy disks started at $10 each,
with dollars that were the equivalent of $2 in 1993
dollars: so, each time you punched a notch and
turned one over, you basically gained $20 in themoney we use today. You then also needed only
half as much, in terms of physical shelf space, to
store as much data. It might stagger the present
day mind to actually think of that monstrous
storage problem we had when we wanted to store
any huge books, such as the Bible, on single sided
floppies.
The two points I want to make here are that for the
cheapest of these machine prices back then, you
can now get a machine that is 100 times faster
with 100 times the disk space: and that the same is
true for the most expensive AND that prices today
are actually half what they appear to be in
comparison to the prices listed above.
So, when you spend $3,000 on computer gear
today, you are in fact only spending half as much
as was spent back in '79 for the Konan drive. . .you
are really only spending $1,500 from 1979. . .due
to changes in the value of the dollar as per an
assortment of Consumer Price Index figures [none
of which is in agreement with any of the others, so
you are encouraged a bit to look up additional
information on the subject. These figures [below]
are presented only to provide a continuum to make
comparisons. Actually these figures are a
conservative estimate [as most government figures
seem to be [example, no double digit inflation for
any year since 1947, which was an extremely good
year, by the way.]
So, while other prices were rising to make up for
weakenings in the dollar. . .you are probably awarethat your expenses, in general, have just about
exactly doubled since 1979, when we bought that
first hard drive for $3,000. Those $3,000 in a bank
account that created no real profit other than
enough interest to keep up with the Cost of Living
increases, would now be $6,000 and would buy
you a computer more powerful and with more RAM
and hard drive space than most of you want. A
Pentium with 8 megabytes of RAM and adding
several gigabytes of hard drive, or a 486 with even
more RAM and hard drive.
While the prices of everything else had been going
up at 5%, 6%, 7%, 8%, 9% a year, the price of
computers has gone down, at about 33% per year.
. .a truly astonishing rate that lets you buy
something hundreds of times better for less than
the price was just 10 or 15 years ago.
Below you will find a short index of the computers
we bought since 1979, and then a price index from
1875 to 2010 in case you want to look up some
prices mentioned in certain years a decade or a
century ago would actually be today.
For example, a teenager watching Roger Rabbit
mentioned that the $100 Bob Hoskins received for
working on the case was an extremely low figure.
However, an examination of the figure below for
1947 will reveal that prices then were about 17.5%
which would make Hoskins' fee about $600 in our
1993 dollars we use today. . .even if the physical
dollars are the same.So, what happens to the value that was lost from
our dollars that do not buy as much by a factor of
17.5% since 1947 ?
Let's imagine for a moment that we are financial
wizards and have all the financial connections open
to such wizards; the early 1970's are a perfect
example: Nixon is in office, and he releases the
dollar from the $35 per ounce price supports the
dollar has had since Roosevelt took us off the
standards of direct gold exchange to end the
Depression in the 1930's.
As an example, we send a million of our dollars to
somewhere we CAN buy gold [it was illegal then for
US citizens to have gold, unless they were coin
collectors or worked gold in the professions, such
as dentistry, jewelry, etc.]
So, we have bought a million dollars worth of gold
at around $35 per ounce, which was a pretty fixed
price at the time.
Now, the price restrictions of $35 per ounce are
removed and the price of gold goes up to $755 per
ounce, just about what it did during the next few
months after the price release.
Now our gold is worth 21 times as many dollars as
it was, so we now can sell the gold and get 21
million dollars.
When we spend this 21 million dollars, we are
competing with all the other dollars in the
marketplace, and prices have to go up as a result,because there are now more dollars but no more
anything else. . .so dollars get cheap, and all
dollars everywhere give up a percentage of their
value to pay for an increase in the number of
dollars WE have. So, if all these dollars lose 5% of
their value, then we can buy a 20 million dollar
share of the future with our 21 million dollars while
everyone else loses 5% of the money they let sit in
pockets, under the mattress, or wherever.
Half of the value of every dollar disappeared from
1979-1993 [a period in which the Cost/Price
Indexes rose at about 6%].
And those 1979 dollars would buy only half as
much as a 1969 dollar bought, when prices were
rising even more quickly.
And those 1969 dollars were buying only half of
what dollars bought in 1947.
Here are the doubling years:
2010 1993 1979 1969 1947 1916 and 1933 had
similar costs, about half those of 1947; these
fluctuations were caused by WW I and Depression
1898 was also a very low point, but prices before
this had been quite stable by today's standards,
with 1989 and 1899 being the only two exceptions:
which happened to cancel each other out fairly well
Thus, approximately, prices in 2010 will be double
what is the case in 1993, just as 1993 was double
1979; 1979 which was double 1969, which was
double 1947, which was double a spread aroundWW I and the Depression.
With 1993 labeled as "1.00000" the value of a
dollar which is expected to be spent in 2010 will be
"0.50000" or fifty cents.
2010 $1 buys $0.50 worth of 1993 dollars
1993 $1 buys $1.00 worth of 1993 dollars
1979 $1 buys $2.00 worth of 1993 dollars
1969 $1 buys $4.00 worth of 1993 dollars
1947 $1 buys $8.00 worth of 1993 dollars
1916 and 1933 $1 buys $16.00 worth of 1993
dollars
1898 $1 buys $32.00 worth of 1993 dollars
[These are obviously gross approximations: more
exact figures are presented below.]
Here are some less conservative estimates, from
other sources:
Based on an estimated 17% increase from 1989 to
1993 [4%/year]
Prices doubled as follows:
1982 to 1993 1973 to 1982 1950 to 1973
1993 1.17xxxx 1978 0.573016 1968 0.299207
1946 0.153972
Note fluctuations for WWI, WWII, and Depression:
these come close to these doublings, but not for a