In 1912 the price of a top quality men's tailored suit was about the equivalent of an ounce of gold.

[Fumesucker]

In 2012 the price of a top quality man's tailored suit is..

About the equivalent of an ounce of gold..

Someone who watches the markets a lot told me that today, it sounds like it may be in the ball park.

Discuss?

[zeemike]

1. And that was like 20 dollars?

If I remember right a 20 dollar gold piece was about an ounce.

[Fumesucker]

2. 28 grams to the ounce and the 20 dollar piece weighed 33 g..

So more like $17 or $18 ..

[The Magistrate]

8. Troy Ounce, Sir, About 31 Grams, is Used For Precious Metals

Not the avoirdupois measure.

If the piece weighed more than a troy ounce, it is likely the weight of the gold portion of the coin ( the metal is not struck pure for coins, but always alloyed in some degree for durability ) would come out to something a bit under twenty dollars worth, at least at the time of striking ( governments always liked to make some profit on their coinage... ).

[Fumesucker]

10. I used to know that, slipped my mind, thanks for reminding me.

[Lucky Luciano]

17. No it was mixed with 10% copper because gold is too soft.

The gold made the coin stronger and less prone to getting misshaped. The gold content was correct. For most of US history coins were 90% gold/silver precious metal and 10% copper - I think there was a time when it was 89.24% vs 10.76% IIRC.

[The Magistrate]

19. Not Sure What You Think You Are Correcting, Sir

The gold content of a twenty dollar gold piece ran to a bit under one troy ounce, at a rate of twenty-four parts out of twenty five, producing a gram weight of gold of about twenty-nine and three-quarters grams ( about one and a quarter grams short, out of thirty-one and a tenth ), which give the government a profit of four percent on coinage, relative to the market price paid for the gold supply of the mint.

[Lucky Luciano]

20. I don't know of it being considered one ounce of gold.

I was correcting what I thought was the idea that it was mixed with other metals purely to make a profit.

[The Magistrate]

24. Check The First Parenthetical, Sir

"...always alloyed in some degree for durability..."

The familiar 'sterling silver' is the old English standard for coining silver, and is eight parts of a hundred copper. In my youth Mexico still minted peso coins in a silver that was twelve parts in a hundred copper, which gave it a perceptible pinkish tinge when next to a new quarter.

[Lucky Luciano]

25. Ah missed the first parenthetical and reacted to the second.

My bad. Carry on.

[FarCenter]

3. How much did it cost in Morris County, New Jersey?

a survey of retail prices advertised in the Daily Record, May 1-15, 1912

Clothing
Men's blue or brown serge suits 1.98-5.98
Men's hats 1.95
Men's shirts .95
Men's trousers 1.45-2.95/pair
Women's dresses 12.50-25.00
Women's serge dress 4.98
Women's spring coat 4.98-9.98
Children's dresses .50-2.95
Children's shoes .85-3.00/pair
Shoes, custom made 5.00/pair

http://www.gti.net/mocolib1/prices/1912.html

[Fumesucker]

5. Good find..

I think a bespoke suit might have been a few times that..

An Armani is $1995 now..

http://www.saksfifthavenue.com/main/ProductDetail.jsp?PRODUCT%3C%3Eprd_id=845524446430276&afsrc=1&site_refer=GGLBASE001&ci_src=14110944&ci_sku=8034154939789

[FarCenter]

12. If you look at the various categories of goods, some have gone up x10 and others x100.

However, few things have gone up less than times 10.

Therefore, the mint could save a bundle by eliminating the nickle and penny and we could price all cash transactions to the nearest dime.

[Fumesucker]

14. Yes, we could..

Probably save the equivalent of a couple of days of air conditioning tents in Afghanistan..

Definitely worth doing..

[lacrew]

4. An old Adage

This link shows a suit cost $1.98-$5.98

http://www.gti.net/mocolib1/prices/1912.html

I found gold was around $19/oz:

http://www.nma.org/pdf/gold/his_gold_prices.pdf

The adage is that 100 years ago, an oz of gold would buy a really, really nice suit....and it does today.

Seems close enough to accurate - gold is around $1,600, which would be a pretty nice suit.

The point of the adage is that gold does not increase in value...its increase in value is really just a reflection of inflation in the dollar. You can probably come out ahead with gold, if you get in and get out, at the right points in time...but as a long term investment strategy, it really isn't going to outpace inflation.

I tend to agree. If I had bought gold 5 years ago, and sold it today....I would be a genius. If I bought it today...well, in five years, I may not look like a genius anymore.

I have never bought gold (other than as jewelry)...I suppose there is some security in its intrinsic value, in case of armegeddon...IF you actually hold the gold. Paper gold - no way. It offers no hedge against armegeddon.

Just my humble opinion.

[Fumesucker]

7. There's another lesson I think..

The purchasing power of the dollar has declined..

I'm also told there is far more paper gold than actual metal, contracts and so forth.

In your view would that tend to increase or decrease the value of the physical metal?

I don't even have any gold jewelry, just for the record.

Edited for speling.

[lacrew]

16. I have also heard there is more 'Paper' out

on gold, than physically exists. I don't think this affects the value of physical gold...but makes the paper gold as 'real' as, say, a paper dollar...which begs the question, why own paper gold.

Yes, the purchasing power of the dollar has declined...primarily because of a deliberately inflationary monetary policy. This is what the Ron Paul supporters are up in arms about. And, they do have a point. The federal government uses its ability to sell treasury bonds, with the fed...and can manipulate the currency, such that we on average will always have inflation.

This forces us to invest our money in the first place. If it weren't for inflation, under the matress would be a sure bet. But the inflationary policy forces us to lend money to banks (deposit money), and to invest in companies (stock market), and even to lend money to the government (bonds).

This inflationary policy also reduces the magnitude of our debt...and the forced investment it causes stimulates growth, and growth is also a mechanism we can use, to overcome our debt.

Its the system we have; and, I don't see any major changs coming soon...so I haven't invested alot of brainpower into deciding whether or not I like the fed, or we should go back to the gold standard...but as whacky as Ron Paul is, he may be on to something.

[Zalatix]

28. Yup, paper gold = no hedge against inflation.

You have to physically hold the resources near your person.

The day gold is that important is the day that a nice, well-maintained farm and your relationship with your community holds just as much currency as a pile of gold.

[n2doc]

6. And a decade ago it would have bought you a cheap suit

A decade ago a share of Apple Computer would have bought you lunch at Applebees ($10). Now it would buy you dinner and wine at the best restaurant in NYC ($600).

Nothing magical about Gold.

[Fumesucker]

9. I don't recall claiming there was anything "magical" regarding gold..

Apple on the other hand is magical, it takes the blood, sweat and tears of third world labor and turns it into shareholder value at a tremendous rate.

[n2doc]

18. Sure. You were claiming that it is an inflation hedge

And I am saying, well, maybe sometimes. But there are lots of times when it isn't such a good hedge. Like 1980-2000.

And I could have picked many other stocks as examples as well. Maybe even some you approve of. My point is Gold is an investment. And it has its ups and downs, and doesn't magically follow the buying power of the dollar inversely.

[Fumesucker]

26. I didn't make any claims at all..

I was asking questions regarding a claim I heard..

Evidently the claim is at least somewhat accurate..

Apple is only magic in that it takes the blood, sweat and tears of third world workers and gets a higher rate of return than any other company I'm aware of..

Evidently over the hundred year period from 1912 to 2012 gold has done fairly well as an inflation hedge, as I said I own no gold at all, not even jewelry, I also don't own any stocks or bonds so I have no dog in this particular fight.

[Zalatix]

29. LOL, well said.

[flvegan]

11. Depends on the opinion of what a "top quality man's tailored suit" is.

One can get something nice from Brooks Brothers for under a grand. Gold is what, $1700/ounce or so now? That'll get you a nice suit from Armani and their equivalent. It's a mere starting point for something from one of the tailors on Savile Row.

[Fumesucker]

13. Armani is evidently around $2K now..

That's what most people would consider a very good if not the ne plus ultra..

I don't really "do" fashion but Armani has cachet with the hoi polloi AFAIK..

[Robb]

15. Didn't someone do this with a Harvard education recently?

My brain's weak on the details, but IIRC it was the same weight in gold for an education at Harvard (Yale?) in 1912 as in 2012.

[Yavin4]

21. We Went Off The Gold Standard In Order to Pay for a Global Military Empire

We are allowed to inflate our currency because buying oil on the global market requires dollars.

In addition, having an inflated currency is the biggest culprit behind the 1% / 99% split.

[safeinOhio]

22. About 50 years ago

gas was 25 cents/gallon. Today a silver quarter will get you a little over 4 bucks.

same thing.

[saras]

23. Irrelevant since we started using gold industrially.

[Fumesucker]

27. Could you elaborate a bit? n/t

[zorahopkins]

30. Gold Was $35.00 an Ounce in the Late 1970's

I am old enough to remember when the price of gold was $35.00 and ounce.

It was in the late 1970's.

The price of a top-quality man's tailored suit then was far in excess of $35.00.

[Fumesucker]

34. I might even have a Silver Certificate around here somewhere..

I'm definitely old enough to remember the gold standard, that's when the price of gold was artificially controlled by the government.

By no means am I advocating for the gold standard or a gold standard..

[Cleita]

31. It used to be that gold was worth what you could buy a man's suit with in

regular money. So if that suit is $500 today and not $20, an ounce of gold should be $500. It more or less is due to inflation. The price of silver was tied to it as well. A man's suit was often used as criteria, but I think you could find other items that would do as well to measure inflation and deflation, which would affect the price of gold and silver back then. Today, I don't know though. It seems gold and silver have fallen to casino economics as well so there is nothing that neat and tidy today especially since we don't tie our currency to the gold standard anymore.

[Fumesucker]

33. An Armani suit is $2,000 give or take a bit..

I could go to the Men's Wearhouse and get out for a fraction of that, as someone pointed out downthread Savile row would be higher than Armani most likely.

Truth be known if I could probably go to a nice thrift store and get quite a good suit for $50 or perhaps even less..

[slackmaster]

32. What Would Frank Zappa Say?

[madrchsod]

35. that suit was made in america and could have been union made....

[DefenseLawyer]

36. Soup and sandwich are not a meal, Jerry. n/t

[Fumesucker]

37. Depends on how much money you have..

Evidently that was some cultural reference that just flew over my head..

[DefenseLawyer]

38. It was

and it did.