TIP OF THE WEEK: Have you ever wondered how much things cost in gold? PricedInGold.com does it for you.

Have you ever wondered how much things cost in gold?  PricedInGold.com does it for you.

Jason Brizic

March 2nd, 2012

Prices can be expressed many ways.  In a barter economy the price of fish can be expressed in terms of any other good.  “I’ll give you 12 eggs for 1 fish.”  The price of the fish is 12 eggs.  It can be said another way: the price of one egg is 1/12th of a fish.   Barter is tedious because both owners of goods have to want what the other guy is willing to part with.  This is called double coincidence of wants.  Money solves this problem.  It acts as a medium of exchange.  Mr. A has eggs.  He trades them to Mr. B for some silver coins.  Mr. A has silver now.  He wants fish.  He trades Mr. C some silver coins for fish.  Everyone is happy.  Money is the most marketable commodity.  It make exchange of goods easier than barter.

All prices in the US are expressed in dollars because of immoral legal tender laws.  There is a website that allow you to see many interesting prices expressed in weights of gold.  Not only does it show the current price, but it shows the historical price going back over a hundred years.  Prices can be measured in troy ounces of gold or gold grams.  Gold grams are a good measurement for smaller goods such as barrels of oil or food.  Here is the conversion formula for troy ounces to grams:

one troy ounce = 31.1034768 grams

As you can see in the long term chart below, oil is a volatile commodity, with it’s price swinging wildly in a range from less than 1 gram per barrel to almost 5 grams per barrel. But this chart also shows that these oscillations are part of a sideways price movement centered around 2.5 grams per barrel. Crude’s current price around 2 grams is a bit below it’s long term average.

Of course, the fluctuating value of the dollar makes it very hard to gauge whether oil prices themselves are rising or falling… Oil today at 2 grams, is about the same as it was in the early 1950s; but if you measure the price in US dollars, you would get the impression that it is about 30 times more expensive today!

Crude Oil, West Texas Intermediate From 1950:

Image001

To see dozens of more prices expressed in gold go to www.pricedingold.com

For more tips, go here:

http://www.myhighdividendstocks.com/category/tip-of-the-week

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Published in: on March 2, 2012 at 5:05 pm  Leave a Comment  

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