- ITM TRADING, INC.
Slides and Sources: https://www.itmtrading.com/blog/time-…
A recent IMF survey of 17 advanced economies looked at every financial crisis between 1870 through 2013 and found that there is “a strong link between inequality and financial stability.” In 1971 the average wage was $9,870. In 2019 the average was $48,672 according to the BLS (Bureau of Labor Statistics). Which would you rather have? But a family of four needed one wage earner to meet their basic needs and today it takes two. Had the average worker been paid in ounces of gold in 1971, that would have been 282 ounces at $35 per ounce. At the current spot price of $1,570.40 per ounce, without a raise, that total wage would be $442,852.80 and most families of four could live well on that with one wage earner.
Where has all that wage inflation gone? Into CEO pay. According to data from statista, between 1978 and 2018 CEO pay has increased 940.3% while the average workers wage has only increased 11.9%. In fact, income inequality is now greater than it was in 1929! In addition, Fed data shows that non-runnable deposits, which are also bail-inable, have been “substituted” for runnable wholesale funding which is provided by governments and central banks. This matters to all of us because when it gets too expensive to keep these truths hidden, the music will stop and we know that the public will be left without a chair. Who will have chairs? Those who hold real money gold. It really is that simple.