well, at least it was simple enough for me.
For many Ages, those Parts of the World which are engaged in Commerce, have fixed upon Gold and Silver as the chief and most proper Materials for this Medium[of exchange]; they being in themselves valuable Metals for their Fineness, Beauty, and Scarcity. By these, particularly by Silver, it has been usual to value all Things else: But as Silver it self is no certain permanent Value, being worth more or less according to its Scarcity or Plenty, therefore it seems requisite to fix upon Something else, more proper to be made a Measure of Values, and this I take to be Labour.
By Labour may the Value of Silver be measured as well as other Things. As, Suppose one Man employed to raise Corn, while another is digging and refining Silver; at the Year's End, or any other Period of Time, the compleat Produce of Corn, and that of Silver, are the natural Price of each other; and if one be twenty Bushels, and the other twenty Ounces, then an Ounce of that Silver is worth the Labour of raising a Bushel of that Corn. Now if by the Discovery of some nearer, more easy or plentiful Mines, a Man may get Forty Ounces of Silver as easily as formerly he did Twenty, and the same Labour is still required to raise Twenty Bushels of Corn, then Two Ounces of Silver will be worth no more than the same Labour of raising One Bushel of Corn, and that Bushel of Corn will be as cheap at two Ounces, as it was before at one; ceteris paribus.
Thus the Riches of a Country are to be valued by the Quantity of Labour its Inhabitants are able to purchase, and not by the Quantity of Silver and Gold they possess;
i'm a little hesitant to get back in market yet.
1929 'crash' took nearly three years to bottom, with a couple rallies along the downhill slide.
here's a somewhat expanded chart.
sorry, image is too many pixels to post.
seems to me that a lot of alleged money has recently disappeared back into the thin air from which it sprang. Logic would suggest a plain old savings account might see an increase in purchasing value as a result. 1929 showed it takes a while to drain the money from the stock market, so i thought we might see some of that deflation as Franklin predicted.
But Geithner is throwing money out treasury's window so fast i have no idea what'll happen. Control systems tend to "ring" or maybe burst into oscillation when given a sudden jolt.
the tv ads are saying 'buy gold' , just like they were saying 'borrow money' last year which makes me think that ship is oversold already and they're scalping tickets.
so i have no idea what to do. i'm thinking twenty acres and a tractor...
Money has lost so much value in my lifetime the graphs all have it down near zero.
To see the current trend we really need to see it on a semi-log graph, ie log(value) vs time.
I remember my Dad, an aviation forecaster, saying in astonishment "Some of those airline pilots have twenty-thousand dollar houses!"