• ToastedRavioli@midwest.social
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    11 days ago

    Base inflationary calculations kind of miss the real difference in attaining X thing for Y cost in Z year though.

    $395 in 1910, when the average person made around 25¢ an hour, would have taken 1,580 hours of work for the average person to buy. Or roughly 40 (40 hour) weeks of work.

    Today, the median non-farm worker makes about $50,000 per year or $26 an hour. The equivalent of working the same number of hours at $26 an hour is just over $41,000.

    As you can see, $41,000 is a far cry from $14,000. The number honestly makes more sense considering that the median cost of a new vehicle right now is $49,000.

    Inflation calculations really fail to capture the actual power of money in relative terms, even though on a technical basis they are “correct”

    For the average person to buy an average priced car today requires an additional 300 hours of work more than it took back in 1910 for someone to be able to buy the car in this post. Inflation obscures that reality by making it look like it should take 1/3rd of the time, since its only “$14,000” today. But everyone knows that is not true just based on personal experience. Its certainly not that easy to buy a new vehicle