patrick.net

edvard2 says

I had numerous family members who went through the depression of the 30's. There is absolutely no comparison between then and now. Back then for example there were hardly any safegaurds in place. If your bank went under then you instantly lost all your money. If you were out of work you instantly had no income as there was no such thing as unemployment insurance.

I'll just put it this way: To this day those in my family who are still alive from that generation still keep their fridges and freezers absolutely stuffed full of food as well as all of the pantries and basements too. Things were so bad back then that even food was in some cases a scarcity.

The recession of the 2000's was and is nothing in comparison.

Yup. By today's standards my grandparents looked like "hoarders", but they lived through the great depression and had their reasons. One thing that I noticed about them was that they rarely, if ever, complained about any sort of inconvenience in life, whereas people today go nuts if they can't find 3G data coverage while waiting in line for a whopping 5 minutes at Starbucks.

I think a crucial thing missing from this argument if I were to even entertain that the depression and recession are at all related ( which they aren't) and the argument is over house prices, well most of the country is still pretty affordable. For example where my parents live in NC, they own acres of land, a 2 story house, a large shop, and a pool. The value is about $150,000. $100,000 houses are still common in their area. Its just that certain areas of the country are still grossly more expensive than others.

tatupu70 says

And that logic doesn't disturb you in the slightest?

You mean the logic that shows the cause. Uh let me think about that, oh ok, Nope none what so ever

indigenous says

You mean the logic that shows the cause. Uh let me think about that, oh ok,
Nope none what so ever

OK--that's what I figured. As long as it fits your preconceived notion, then it's right. Fit the data to your view, not the other way around, is how you operate, right?...

tatupu70 says

OK--that's what I figured. As long as it fits your preconceived notion, then it's right. Fit the data to your view, not the other way around..

Whatcha talkin bout Willis

indigenous says

ost of a new house 1933: $5,750.00 (equivalent to $93,565.72 in 2010)

Is 94k the average price of a house?

population growth.

/thread

tatupu70 says

Wow--I would say it's irrefutable that wages have increased more than inflation.

Yeah, especially if we use those gigged CPI metrics cooked up by that coward Boskins in a way which significantly understates the inflation that is so readily perceptible to the end consumer.

http://www.multpl.com/case-shiller-home-price-index-inflation-adjusted/

Notice how house prices increased dramatically following federal intervention in the mortgage market, and how CPI continued to increase even as the housing component fell.

indigenous says

Ok then what about these numbers?

Cost of a new house 1933: $5,750.00 (equivalent to $93,565.72 in 2010)

Cost to rent a house in 1933: $18.00 per month (equivalent to $292.00 in 2010)

Brand New Plymouth in 1933: $445.00 (equivalent to $7241.17 in 2010)

Gallon of gas in 1933: 10 Cents (equivalent to $1.62 in 2010)

Loaf of Bread in 1933: 7 Cents (equivalent of $1.13 in 2010)

1 Lb. Of Hamburger Meat in 1933: 11 Cents (equivalent to $1.79 in 2010)

Can of Campbell’s Vegetable Soup in 1933: 10 Cents (equivalent to $1.62 in 2010)

Dozen Eggs in 1933: 5 Cents (equivalent to 81 Cents today)

What were median wages back then?

bmwman91 says

What were median wages back then?

The average American’s annual income in 1933 was $1,550.00. Today, that would be the equivalent of $25,218.00. According to the last Bureau of Labor Statistics report for 2009(4), the average American’s annual income was $28,592.00 (mid range between highest and lowest by State for 1 person). This may seem like we’re ahead of the game compared to the Great Depression. However, when you consider that the lowest bracket of income tax was levied at 4% in 1933 compared to 15% in 2010, you can see that we are almost on par. But you also must consider the plethora of other taxes and deductions that have since been siphoned out of the average American’s paycheck. Contemporary sales taxes and compulsory enrollments like mandatory insurance (both auto and health) must also be added into the equation to get a better gauge as to where we are now compared to days gone by.(5)

indigenous says

The average American’s annual income in 1933 was $1,550.00. Today, that would be the equivalent of $25,218.00.

Yet, the median income is only about $46k/yr even though workers today are easily 10 times as productive due to technology. Think about that.

indigenous says

Contemporary sales taxes and compulsory enrollments like mandatory insurance (both auto and health) must also be added into the equation to get a better gauge as to where we are now compared to days gone by.(5)

You're leaving out cheap credit as a stopgap, which was not available to the average slob in the thirties.

indigenous says

The average American’s annual income in 1933 was $1,550.00. Today, that would be the equivalent of $25,218.00. According to the last Bureau of Labor Statistics report for 2009(4), the average American’s annual income was $28,592.00 (mid range between highest and lowest by State for 1 person). This may seem like we’re ahead of the game compared to the Great Depression. However, when you consider that the lowest bracket of income tax was levied at 4% in 1933 compared to 15% in 2010, you can see that we are almost on par. But you also must consider the plethora of other taxes and deductions that have since been siphoned out of the average American’s paycheck. Contemporary sales taxes and compulsory enrollments like mandatory insurance (both auto and health) must also be added into the equation to get a better gauge as to where we are now compared to days gone by.(5)

Next question. Are you arguing that people were better off back then?

I would like to know buying power of median salary by looking at price to income ratios for single family homes, as well as other stats like % of median income to pay for health insurance.

SFace says

I think average income and median income is being mixed. $1,550 does not make sense in 1933 when unemployment was 20%+ and rent was $18 a month average.

Median income is way lower in 1933 or we are mixing median with average with household/individual between 1933 and 2009. While median income is a 28K or so, average is closer to 45K.

In any case, it is no surprise housing price is higher. Housing eats up excess margins and is a function of accumulated wealth first, and income at the margins.

I don't know. To some extent this reminds me of talking about modern baseball players compared to players from the past. They were two different games

But I still don't see a reconciliation of much of this information, even with what you said housing prices should be lower along with food costs.

indigenous says

But I still don't see a reconciliation of much of this information, even with what you said housing prices should be lower along with food costs.

Globalization is also a factor now, much more than was then. Much of the rest of the world has pretty nasty income to living expense ratios, and America is sliding in that direction. We were much more of an isolationist nation prior to WWII. Just like how baseball is a different game now, America is a different nation now.

bmwman91 says

Globalization is also a factor now, much more than was then. Much of the rest of the world has pretty nasty income to living expense ratios, and America is sliding in that direction. We were much more of an isolationist nation prior to WWII. Just like how baseball is a different game now, America is a different nation now.

That infers that this is a problem to the U.S. In reality it is not though benefits of comparative advantage.

An example to how the isolation thing does not work as whoever practices it does not benefit from comparative advantage is China. Once the most advanced nations in the world they decided to build the great wall to create isolation and languished as a result, only recently did they start recovering because they re instituted free trade and comparative advantage.

bmwman91 says

Are you arguing that people were better off back then?

But the CPI refers only to the consumer, not people. The American people are clearly better off in many ways (though, arguably, less interesting and much less discerning); American consumers? No, not so much.

When was the last time you heard a politician refer to people as people? We are either taxpayers or consumers.

The Professor says

If your point was rich people don't care about the price of milk, you made it.

Didn't know you were such a troll professor.

tatupu70 says

Didn't know you were such a troll professor.

Be nice, Tatupu70.

My thinking on this subject is that the costs have been increased by government regulations and taxes. I can't find the numbers but have read in the past that there are the same number of worker in farm bureau now as there was in the 1920s but now there is a fraction of the number of farms. Or the energy department cost I think 20 billion per year who's stated purpose was to lessen the U.S. dependency on foreign oil. Both cases are laughable.

Technology decreases the cost so if any thing government burdens have made up for the difference plus some as indicated by the numbers.

This a theory not a fact and perhaps you lefties are correct and the numbers in the article are bogus?