We complain, justly so, about inflation.
All the people that personally remember the catastrophe of deflation from 1930-33 are dead.
Look, at the percentage decrease in the price of Prince Albert, Velvet and Edgeworth from the Sears catalogs of 1923 and 1938. And 1933 would have been worse.
View attachment 311065
View attachment 311071
The human toll of misery and despair is beyond our imagination today.
Headline unemployment reached 25%, and only those looking for work counted, just as today.
Real GDP fell 29% from 1929 to 1933. The unemployment rate reached a peak of 25% in 1933. Consumer prices fell 25%; wholesale prices plummeted 32%.
There is a 60 acre field I still own that was sold to my Great Uncle Elmer in 1922 for the bargain family price of $66 an acre. It appraised at $100.
In 1936 Elmer grew weary of fighting against low prices and droughts and had a big auction.
His beautiful sister Eva who’d married a rich man paid $3.50 an acre.
Eva promised my father, a 17 year old kid, that if he’d share rent the 60 she’d sell him the land when he could pay $3.50 an acre himself.
By 1944 when my father had the money, Eva decided she had to have $15 an acre. He paid.
Who knows how much more valuable in constant dollars, that land is today.
I’ve heard all kinds of arguments of why the Great Depression happened.
But none about what ended It.
When the Japanese bombed Pearl Hatbor, that ended it, hopefully forever.