In any circumstances, prices on cars are difficult to compare because “top of the line” cars from different time periods are different products with different features. This is, of course, directly related to the statement Mr. Gladish made above.

The many improvements/changes mandated by the state have increased the price of automobiles beyond the level of inflation (and made them a maintenance nightmare). Of course this is one of the big problems with inflation calculation as it is no small problem to factor in the impact of product revisions.

The square footage of the average house has increased over 100% since 1950, and more than 50% since 1975.

At the same time, the number of persons per household has declined from nearly 3.5 in 1950 to less than 2.5 today.

Under our current medium of exchange – the electronic banking system – “money” functions as an IOU and not as a storage of a hard asset.

And what, under this IOU, does one owe?

Under our current medium of exchange – the electronic banking system – “money” functions as an IOU and not as a storage of a hard asset.

The money supply in a free economy doesn’t have to be gold, silver, platinum, copper or anything else. You can trade in tobacco, grain or anything else. The market will choose its own best medium of exchange. If a bank or other institution chooses to coin “money” than the market would be free to accept or reject such coins. The tendency over time would be for any medium of exchange to appreciate in value, creating the effect of a steady or slightly declining price level.

For international trade, necessity would dictate use of gold or silver for such trade, with a fixed exchange rate, based on weight of coinage.

What is needed is for government to take their central banks and butt out.

You’re welcome to insult the state of Mississippi (where my wife was born and raised and one brother now lives), but all it does is expose your ignorance about the South. The Mises Institute, after all, is headquartered in Alabama.

On second thought, this makes perfect sense, as your ignorance about both goes hand in hand.

I don’t think houses have changed that much as far as utility and comfort to the user is concerned.

Sure, things like furnaces and ovens are more energy efficient nowadays, but I’d guess they don’t affect the wallet too much.

Nevertheless, if you’re going to keep posting here, you might at least make an attempt!

Only I went back a bit further.

Assuming consistent money supply…

A spiffy 1925 Hudson Sedan would cost only $217 today.

Don’t know about a burger, but a “Sunday Chicken Dinner” in a nice family restaurant would be about 11 cents today (13 cents with tip!)

And today you could nail a roomy 3 bedroom house in New Jersey for under $1000!

So, I see a big discrepancy between the CPI and what prices actually are nowadays. Comparing the official government CPI calculator and the official housing price calculator, housing prices are 78% higher than they should be (comparing 1975 to 2006).

What gives? My hunch is that inflation has been grossly underreported for decades.

Gee, no kidding? You could make your posts shorter if you dispensed with the obvious.

The $600/$0.12 in terms of 1959 dollars, correct?

If we re-adjust for the 6.7x that the price level has increased since 1959, then that would be about $4000/car, $0.80/hamburger, using 2005 dollars, correct?

So, what I’m saying here, is although the car may cost $600 and the hamburger $0.12 with a steady money supply (since 1959), it would feel like paying $4000 for the car and $0.80 for the hamburger to put it in more-familiar 2005 terms. I know this assumes a lot, but just trying to make it more familiar (since I wasn’t alive in 1959).

First off, just about every post you leave here drips with condescension. You might want to tone that down a bit if your goal is to persuade. It gives you the air of a grouchy crank.

Secondly, your point is valid to some extent about the need to compare other data to get a more complete picture, but I think that you overstate the case. The effects of inflation upon real wages and living standards might not be apparent to the newbie economist, but there are plenty of articles here that cover that subject in some depth. What is not so obvious is the degree to which inflation has been occurring, since increases in productivity serve to hide its effects.

Thirdly, I’m curious to know what your stand is upon Austrian economics (just the economics, mind you, not sociology, ie. Rothbard), which does reject much of the empiricism of mainstream economics as fallacious and ultimately self-defeating. I’ve watched you take some pot shots from the sidelines and it makes me wonder why you’re really here.

Incomes? The data is there to make a comparison within this empirical framework, and even to show us how clever empirical economics is, so why is income left out of the picture?

Standards of living?

The data is not there, and really, that is what we’re all interested in, isn’t it? Economics means nothing, if we cannot measure how well we live on this particular spot on the planet, and indeed, how well those who will follow us in the future will live here as well.

If we, or they, all die due to the rapacious apetite of an economy out of control demanding ever more of the very essense of sustenance to feed economic growth , the cleverest empirical analysis of the “data” will not mean did-ily-squat.

That’s sure a fine Austin though. I bet is cost less than $2500 in 1959.

Come back Mark Brandly, and bring us more pictures of such fine automobiles.

Don Robertson, The American Philosopher