March 11, 2012

Having Green May need Gold

The green that drives you into the 21st Century may not be green at all! It may not even be an electric car, biodiesel, hybrid or even recycled aluminum.

Here is what I mean:

The deterioration of the "greenback," also known as the Us Dollar, has devalued so much since advent off the gold standard that it pales in comparison with its old gold-backed value.




Here is an example:

Henry Ford advanced an automobile output line in the early 1900's. His aim was to make the automobile ready and affordable to the base man. He achieved his goal starting in 1908 with output of the Model T Ford. It came with the choice of black or black paint, a 20 horsepower, 4-cylinder motor, ran on ethyl alcohol and got between 13 and 21 Mpg...a truly "green" machine!

The cost was 0 and was marketed to middle-class America.

Move the clock forward to 2011.

Today you can buy a 2011 Ford Fusion, V6, Sel starting at ,555. It has 263 horsepower and gets between 18 and 26 Mpg. It too is designed to motion to the middle class.

But what about the price? It has gone from 0 to ,555. That's 31 times more than the original Model T.

Granted, the T did not have A/C, power windows, power brakes or even an electric starter, but 31 times more?

Here is an exciting discovery about inflation, rising prices and governmental manipulation of the value of paper money. As you can see from the example the good old green dollar today is not worth nearly what it was in 1908. Its purchasing power has greatly deteriorated. There is no way you can buy a new car for 0.

I think you know why.

But take a look at this example for comparison.

In 1908 you could buy a Model T Ford for 1,321 grams of gold. The same 1,321 grams of gold today would buy an automobile worth ,386. That's not One but Two 2011 Ford Fusions (give or take a few dollars).

So, what happened?

Well, its simple, gold increased in value and paper money Decreased in value.

This has been the trend ever since paper money was not backed by gold.

As we look to the future it may not be so green for the middle class unless it can protect its financial future with something other than green (paper money). I believe gold in small quantities, saved over a duration is the respond to having sufficient "green" to weather the determined economic urgency of the 21st century.

Having Green May need Gold

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