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How much would $1.50 in 1945 be worth today?

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Re: How much would $1.50 in 1945 be worth today?

#11

Post by bryan_rasmussen »

That's a pretty lousy rate of return for inventing time travel really.

The normal way one calculates this is by buying power of those dollars - what could you buy then and what would it cost now.

But really I could have bought a Sub-Mariner comics #15 in mint condition, and it would be worth quite a bit more today.

Re: How much would $1.50 in 1945 be worth today?

#14

Post by jccooper »

If you had $1.50 in 1945 and held it until today, you'd have $1.50. Problem is, in 1945 it would have bought you lunch for a week, and today it would buy you one miniature fast food hamburger.

My parents tell me tales of my great grandparents who didn't trust the banks and probably buried money in the yard near where I live. If they buried it in cash, well, it wouldn't be a very impressive sum today.

That same $1.50 invested at 3%, you'd have... $12.22 today. A little better, but inflation's still pretty rough. You'd have been better off buying that pair of overalls in 1945.

Now, $1.50 worth of gold in 1945 would be worth $57-ish today, so if my great grandparents didn't trust the greenback either, then that theoretical coffee can is worth something. But don't take that as investment advice; the dollar price of gold went through the roof when the dollar was taken off the gold standard (go figure) and that's not going to happen twice.

Re: How much would $1.50 in 1945 be worth today?

#17

Post by ChristianMarks »

rangibaby wrote: post #13
Jxnathan wrote: post #3

$1.50 in 1785 (when US dollars were issued) http://www.wolframalpha.com/input/?i=%241.50+1785+today

I was more surprised at the lack of inflation (about the same between 1785 and 1945 and 1945 and now).

Interestingly, the period after 1945 coincides with the explosive growth in computing performance, according to William Nordhaus of Yale University in a 2002 study entitled The Progress of Computing [1].

Nordhaus documents computer performance improvements on the order of 1 trillon to 5 trillion times "...in constant dollars or in terms of labor units since 1900." During that period, Nordhaus notes that "...there were relatively small improvements in efficiency (perhaps a factor of ten) in the century before World War II. Around World War II, however, there was a substantial acceleration in productivity, and the growth in computer power from 1940 to 2002 has averaged close to 50 percent per year."

Automation really picked up in industry in the period since 1970, which has seen relatively stagnant wages for most of the working population.

[1] http://nordhaus.econ.yale.edu/prog_030402_all.pdf

Re: How much would $1.50 in 1945 be worth today?

#18

Post by benched »

Inflation is very powerful. I always feel like people don't think about it in enough detail. For example, the year that your dollars were worth twice what they are now? That would be the long-ago time of ... 1988. Did you learn your general sense for how much "20 dollars" is in the '80s? Doesn't "40 dollars" just sound like more, somehow? I wonder how many people mentally account for just how elastic nominal amounts are.

Re: How much would $1.50 in 1945 be worth today?

#20

Post by billforsternz »

I remember reading a Time magazine article about inflation around 1980 when I was at university. I remember it projected to the not too distant future (maybe to 2000?) and said, and I quote because it stuck in my mind; "We'll probably all make $100,000 then, but the downside will be that a candy bar will probably cost a whole dollar". I think of it whenever I buy a confectionary item, invariably for multiple dollars.
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