The Great “Depression”…(Good Read!!)
By Howard S. Katz
Monday, 15 November 2010
Today I would like to continue my discussion of the (so-called) Great Depression as this is the giant lie which is behind most of the other economic lies which have deceived so many people and cost them so much money.
What is a depression? It is a period in a country’s economic history where the large majority of the people become poorer. It is alleged that such a period occurred in the early 1930s. I have pointed out previously that Economic Statistics of the United States, Colonial Times to 1970, reports that during this period Americans shifted from margarine to butter. They increased their per capita meat consumption (from 129 lb to 144 lb.). And they gave (substantially) more to charity. Further, real wages rose during this period, and the savings of the average American increased in value (buying power) by 30%. This does not sound like a getting poorer to me.
Let us examine the increase in buying power of the average American’s savings. In the early 1930s, the average American saved and had been saving since interest was legalized (by Noah Webster) in the 1780s. Given an average interest rate of 5% (normal through the 19th century and up until 1933) the average person’s savings would multiply by 4.25 times over the course of his working lifetime.
Average annual wages in manufacturing in America for 1933 were $1,086. At first glance, this sounds like a small amount of money, but one must bear in mind that in early 1933 the country was on the gold standard, and prices were much lower than they are today. In 1933, a new car could be purchased for $400. A two bedroom apartment (San Francisco) could be rented for $25/mo. And a gallon of gas cost a dime. (That dime, by the way, was .075 oz. of silver, which exchanges today for $1.95.)
But I have not found that the careful recitation of statistics has much effect on believers in the Great Depression. The more dispassionate and factual I become the more emotional they become. “But, Mr. Katz, what about the bread lines? What about 25% unemployment? Have you no heart, Mr. Katz.