Inflation

Inflation is raging while governments are lying saying it’s all under control.

In 2010 the costs at Buckland Hall where we do the seminars in Wales, was £68 per night for shared occupancy and three meals. Today it’s £83 and the VAT has gone up from 17% to 20%. So today’s price, just two years later, is 22.25% higher than in 2010; that’s 11.25% annual inflation.

Compounded over ten years presuming VAT remains the same, the cost at Buckland Hall in 2022 will be £241.03 ($390.46) shared occupancy, per night with three meals.

In fifty years from now, a shared room plus food will be £17,142.69 per night. In 100 years from now, the room will cost over three million a night, £3,540,626.033p to be exact.

A pack of gum for 60 pence today will be £25,594.89 in a hundred years from now, at 11.25% inflation a year.

Each year’s inflation builds on the previous year, which is why prices rise so fast.

When inflation goes to 25% annually which it will, it’s considered hyperinflation, at 25% a year inflation in 100 years from now, your 60p pack of gum will cost £2.95 billion!!

So the Depression era adage “Buddy can you spare a dime?” is answered today with “Sorry bro, no I bloody can’t.”

A 1930’s dime at 25% inflation, 82 years later in 2012, would be just over $8.43 million dollars today.

On a long enough time line all inflation drops to zero, as the world ends.  Tee hee.

But you can see how hyperinflation could rub out the power of paper money. The Zimbabwe 50 million dollar note pictured above, probably bought a bunch of bananas, nothing more.

One free range organic egg in Tesco in euros at 25% inflation will cost 1,325,455,235 ( i.e 1.325 billion euros) in one hundred years from now. If you have a secondhand car worth today say £10,000, the egg will be worth £10,000 as well in 47.1 years from now.

It’s not for me to egg you on tee hee, but gold today at $1600 will climb to $4600 at 11.25% annual inflation in ten years. And a pint of Guinness will be 21 billion in 2112. My round !!! Stuart Wilde.

Compound Interest Calculator

http://www.moneychimp.com/calculator/compound_interest_calculator.htm