The Consumer Price in Gold and USD
The chart below illustrates the changes in the cost of a basket of goods and services, based on the Consumer Price Index (CPI-U), from 1913 to 2023. This basket, representing the typical expenses of urban households, is shown in terms of both dollars and gold. In 1913, the cost of this basket was set at 100 units for both currencies.
The Consumer Price Index (CPI-U) tracks the prices of a standard basket of goods and services used by urban households, including:
🍔 Food and Beverages: Groceries and dining out.
🏠 Housing: Rent, repairs, and utilities.
👗 Apparel: Clothing for men, women, and children.
🚗 Transportation: Personal vehicles, fuel, and public transit.
🏥 Medical Care: Healthcare services, medications, and medical devices.
🎉 Recreation: Leisure activities and sporting goods.
📚 Education and Communication: School expenses, books, phone, and internet services.
🛒 Other Goods and Services: Tobacco, personal care products, and miscellaneous services.
If you had purchased this basket in 1913 for $100, by the end of 2023, it would have cost you $3,000—a 30-fold increase in dollar terms. Meanwhile, in gold, the price of this basket was equivalent to 4.8 ounces in 1913, but only 1.5 ounces in 2023, meaning the cost in gold has dropped to one-third over the same period.
Interestingly, while consumer prices relative to gold have generally declined over these 110 years, there were times when prices increased more sharply in gold than in dollars. For example, between 1979 and 2000, the price of this basket in gold rose nearly fivefold, compared to just a twofold increase in dollar terms during the same period.
100 Years of Food Prices in Dollars (1913 - 2013)
100 Years of Food Prices in Gold (1913 - 2013)
