The Case for Accumulating and (Eventually) Using Silver Coins

I recently did a study of prices (food and gasoline) comparing the costs in the early 1960s with 2009 prices for the same items.  I chose the early 1960s because that was the last time 90% silver coins were in circulation.  It was common back then for people to go into a grocery store or gas station and pay for purchases with a few quarters or dimes.  The prices were that cheap back then.

For my 2009 food prices I looked at the prices in my local Safeway store in Portland, Oregon.  I was careful to only look at the regular prices, not the “sale” prices.  The problem one typically runs into when making price comparisons is that many of the food items have been reformulated or repackaged into different-sized containers.  There is a also a much larger variety of items available today.  To circumvent these problems I focused on items that I can remember seeing back in the 1960s.  (I’m giving away my age here.)  They were mostly name brand items that many people avoid today precisely because they are so expensive.

Government-paid economists often fudge the numbers by making excuses that the products under study have changed or that people will choose to substitute less expensive goods for the ones they formerly bought when the prices go up.  That’s clearly cheating!

I stuck with the name brand items so that the comparisons would be fair and honest.  I made sure that I studied only foods and brands that were commonly available both in the early 1960s and today.  Most meat, produce, and dairy products easily fit the criteria.  So does regular gasoline.  This way we have an accurate picture of how much food or gasoline a silver quarter or dime would buy then, and now.

For the purpose of this discussion I will limit the list to just the following 20 common items:

Year of Ad

Item

Cost Then

   

Unit

   

Oz. Silver Then

 

 

Cost Now

   

Oz. Silver Now

   

Qty./Oz. of Silver.

1963

Sliced bacon (Oscar Meyer)

$0.29

   

lb.

   

0.21

 

 

$5.29

   

0.40

   

2.5

1963

Mazola oil (24 oz.)

$0.69

   

bottle

   

0.50

 

 

$4.95

   

0.38

   

2.6

1960

Land O’ Lakes butter

$0.67

   

lb.

   

0.48

 

 

$4.99

   

0.38

   

2.6

1960

Beef, sirloin steak

$0.89

   

lb.

   

0.64

 

 

$4.99

   

0.38

   

2.6

1963

Kielbasa (Polish sausage)

$0.59

   

lb.

   

0.43

 

 

$4.49

   

0.34

   

2.9

1961

Cheerios cereal

$0.25

   

pkg.

   

0.18

 

 

$3.99

   

0.31

   

3.3

1963

Beef, chuck roast

$0.49

   

lb.

   

0.35

 

 

$3.99

   

0.31

   

3.3

1960

Pork chops (thin sliced)

$0.59

   

lb.

   

0.43

 

 

$3.29

   

0.25

   

4.0

1960

Flour (Gold Medal)

$0.49

   

5-lb. bag

   

0.35

 

 

$3.09

   

0.24

   

4.2

1963

Ham

$0.39

   

lb.

   

0.28

 

 

$2.29

   

0.18

   

5.7

1960

Del Monte peaches

$0.29

   

can

   

0.21

 

 

$2.15

   

0.16

   

6.1

1963

Potatoes (russet)

$0.39

   

10-lb. bag

   

0.28

 

 

$1.79

   

0.14

   

7.3

1963

Eggs, large

$0.45

   

dozen

   

0.33

 

 

$1.79

   

0.14

   

7.3

1963

Beef, ground

$0.45

   

lb.

   

0.33

 

 

$1.77

   

0.14

   

7.4

1960

Regular gasoline

$0.29

   

gallon

   

0.21

 

 

$2.69

   

0.20

   

4.8 gal.

1963

Onions

$0.15

   

lb.

   

0.10

 

 

$1.49

   

0.11

   

8.8

1963

Chicken (whole fryer)

$0.29

   

lb.

   

0.21

 

 

$1.29

   

0.10

   

10.1

1963

Green (bell) peppers

$0.05

   

each

   

0.04

 

 

$0.99

   

0.08

   

13.2

1963

Apples

$0.16

   

lb.

   

0.12

 

 

$0.98

   

0.07

   

13.3

1960

Bananas

$0.10

   

lb.

   

0.07

 

 

$0.59

   

0.05

   

22.2

Notice that I have priced the items both in dollars and in ounces of silver.  The prices (in dollars) are deceptive because, on average, prices for these 20 items have increased eightfold since the early 1960s!  The prices in silver tell the truth.  In most cases the prices (in silver) are somewhat comparable.  Many items even look “cheap” now, in silver terms.  That implies that the price of silver is too low.  But, that’s the topic of a different discussion.

Two columns show the prices in silver terms.  The column all the way to the right shows how many of each item may be purchased today with a single ounce of silver.  This is a useful table because, if the paper money completely fails, one can rely on the table to price foods and gasoline in silver.  One ounce of silver buys four pounds of pork chops, for example.  The same ounce of silver buys close to five gallons of gasoline or 22 pounds of bananas!

It’s easy to see that as little as 20 ounces of silver could take a family of four 1,500 miles over the highway while feeding them all along the way.  If the dollar goes all the way bad you are to find a store that’s open along the way you might be able to convince the manager to accept some pre-1965 90% silver coins because he would recognize them for what they are (real American money.)  The pricing is all you would have to haggle over.

Many people love the old (pre-1936) silver dollars.  It would probably not be difficult to convince a store manager to let you have a couple of pounds of ground beef, a loaf of bread, a bag of potatoes, and a box of Cheerios for one silver dollar!

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