A critical element that has been roundly ignored in all the rhetoric of the past two weeks is an appreciation for the Time Value Of Money.

 

Our present and would-be political leaders, the news media, and most of the rest of us share this void in our understanding.

 

Some are not aware and have only their pathetic educations to blame:

 

“The fundamentals of our economy are sound.”  They’re not!

 

Others are fully aware, and keep this knowledge to themselves, using it to their own advantage:

 

“The markets will recover in three to four years.”  Not likely!

 

What we are talking about here is familiar to any adult.  The older you are, the more examples you can cite from your own experience.  Here are two of mine.

 

In the spring of 1973, groceries for my family of six, including four children from age 9 to 3, came from three sources.  Milk was delivered twice a week (remember the good old days), meat was purchased monthly from a Mom and Pop butcher shop, and the rest were bought, also monthly, at a large, no-frills, grocery outlet.  $55 was spent every month at the grocery outlet.  A babysitter was hired, because if we took the children along there was not enough room in our full sized sedan for all the groceries.  In today’s dollars, that $55 would be $282.07.

 

The year I was born, my Father, who’d spent his teen years bartering his way through the Great Depression, landed one of the best jobs available at the time:  an appointment at the Post Office.  His rate of pay was 65 cents per hour.  In today’s dollars, that would be $10.42 per hour.

 

Think about that the next time you read that the Model T Ford sold for a paltry $300, ($5,045).  The men on the assembly line were paid an annual salary of around $1,485, ($24,971).

 

Back to the future.  Yesterday, the Dow Jones indicator closed at 8,579.19.  The high water mark for this indicator was reached on January 14, 2000, at 11,722.98.  That would be 14,928.57 in today’s numbers.  That is 42.532% short of the all-time high.  That is 6,349.38 points that would need to be restored TODAY to achieve the same level as January of 2000.

 

Those are the REAL numbers.