As always, #[0] writes exceptional newsletter posts.
Quote from the February piece:
"Back in 1913, the price for a barrel of oil was $0.95. Today it is $79.
Also in 1913, one gold ounce could buy you 22 barrels of oil. Today, one gold ounce can buy you 24 barrels of oil. In other words, oil priced in gold has been basically flat over a century. It just had volatile ups and downs along the way due to wars, recessions, and other things. Oil priced in dollars had similar ups and downs, but also had a 4.5% annualized upward price trend that compounded over a century.
This is because, at the end of the day, most of what we measure as price inflation is due to money creation and the declining purchasing power of individual units of currency. It’s like doing carpentry work for decades while your measuring tools get slightly smaller each year, and so everything seems like it is gradually getting bigger. Around that trend there are various more noticeable supply/demand imbalances.“
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