Probably something related to the bretton woods conference. That is the only major economic event that took place around that time that I can think of.
Edit: I meant the bretton woods system being dissolved. The coference happened much earlier sometime in the 1940s.
If you were paid 1/20th of an ounce of gold per hour in 1971 you’d get about $2/hr. (~$15 in 2022) (gold @~40/oz)
Today if you were paid that same gold per hour you’d be getting about $1,000/hr (gold @~$20k).
After dropping the gold standard people, paid the same amount of dollars, could suddenly buy less than they could when the dollar was backed by gold. Because they printed more money all the money was worth less.
Look at the stagflation we have going on now. The economy is stagnating but the central banks keep printing money which devalues it.
If you’re not getting 2% interest on your money then you’re losing money in real terms. And this is by design.
“Inflation” is “monetary inflation”, that is an increase is the supply of the currency. On the central bank can cause M0 inflation. Commercial banks contribute to M2 inflation via fraction reserve lending.
TLDR: We went off the gold standard and handed everything over to the bankers who immediately used, and continue to use, that power to enrich the upper class.
Incredible. But what actually did happen to cause the wealth gap to suddenly and rapidly start to widen?
Probably something related to the bretton woods conference. That is the only major economic event that took place around that time that I can think of.
Edit: I meant the bretton woods system being dissolved. The coference happened much earlier sometime in the 1940s.
Getting off the Gold Standard.
If you were paid 1/20th of an ounce of gold per hour in 1971 you’d get about $2/hr. (~$15 in 2022) (gold @~40/oz)
Today if you were paid that same gold per hour you’d be getting about $1,000/hr (gold @~$20k).
After dropping the gold standard people, paid the same amount of dollars, could suddenly buy less than they could when the dollar was backed by gold. Because they printed more money all the money was worth less.
Look at the stagflation we have going on now. The economy is stagnating but the central banks keep printing money which devalues it.
If you’re not getting 2% interest on your money then you’re losing money in real terms. And this is by design.
“Inflation” is “monetary inflation”, that is an increase is the supply of the currency. On the central bank can cause M0 inflation. Commercial banks contribute to M2 inflation via fraction reserve lending.
TLDR: We went off the gold standard and handed everything over to the bankers who immediately used, and continue to use, that power to enrich the upper class.
Bring back bimetalism! Save the middle class!