How Much Inflation have we had since 1913? By Tim McMahon 6/18/15,
inflationdata.com.
US
Cumulative inflation increased by 92.86% from 1913 to 1919 and increased by
103.45 from 1970 to 1979.
Just
like compound interest compound inflation grows faster and faster. The average
annual inflation since 1913 is "only" 3.24%. See Average
Annual Inflation Rates by Decade
But
as you can see from the chart below compounding something for almost 100 years
at 3.24% will result in over 2000% inflation. The Consumer Price index (CPI-U)
for January 1913 was 9.8. The CPI-U for September 2013 was 234.149.
This means that something that cost $9.80 in January of 1913 would cost $234.15
today!
If
that isn't bad enough, actually the situation is even worse than that. If you
look at the chart carefully you will see that inflation was fairly steep during
the "teens" from 1913 - 1920 actually almost 100% (See: Total
Inflation by Decade). Then during the 1920's and 1930's
inflation actually declined. The CPI-U index stood at 13.9 in January of
1940.
So
actually most of the 2000% inflation occurred since 1940. The average
annual inflation rate
in the 1940's was 4.86% in the 1970's it was 7.25% and the 1980's was 5.82%.
Each of those decades were especially hard economically for people trying to
make ends meet while prices increased and wages didn't keep up.
For
more information and a chart see the
average annual inflation rates for all decades since 1913.
US Inflation History - Average
inflation rate by year from 1914 to 2018
In
1913, the US Congress passed the Federal Reserve Act. It imposed a “managed
economy’ and gave the Federal Reserve Bank the authority to set the discount
interest rate used to lend money to banks and print money, causing inflation.
Congress also passed the Income Tax Act and Inheritance Tax Act in 1913. The
first years were mild with a 1% income tax and 1% inflation in 1914 and 1915.
Inflation
moved to 7.9% in 1916, 17.4% in 1917, 18% in 1918, 14.6% in 1919 and 15.6% in
1920.
1914
1.0
1915
1.0
1916
7.9
1917
17.4
1918
18.0
1919
14.6
1920
15.6
1921
-10.5
1922
-6.1
1923
1.8
1924
0.0
1925
2.3
1926
1.1
1927
-1.7
1928
-1.7
1929
0.0
1930
-2.3
1931
-9.0
1932
-9.9
1933
-5.1
1934
3.1
1935
2.2
1936
1.5
1937
3.6
1938
-2.1
1939
-1.4
1940
0.7
1941
5.0
1942
10.9
1943
6.1
1944
1.7
1945
2.3
1946
8.3
1947
14.4
1948
8.1
1949
-1.2
1950
7.9
1951
1.9
1952
1.9
1953
0.8
1954
0.7
1955
-0.4
1956
1.5
1957
3.3
1958
2.8
1959
0.7
1960
1.7
1961
1.0
1962
1.0
1963
1.3
1964
1.3
1965
1.6
1966
2.9
1967
3.1
1968
4.2
1969
5.5
1970 5.7
1971
4.4
1972
3.2
1973
6.2
1974
11.0
1975
9.1
1976
5.8
1977
6.5
1978
7.6
1979
11.3
1980
13.6
1981
10.3
1983
6.2
1984
3.2
1985
4.3
1986
3.6
1987
1.9
1988
3.6
1989
4.1
1990
4.8
1991
5.4
1992
4.2
1993
3.0
1994
2.6
1995
2.8
1996
3.0
1997
3.2
1998
1.6
1999
2.2
2000
3.4
2001
2.8
2002
1.6
2003
2.3
2004
2.7
2005
3.4
2006
3.2
2007
2.8
2008
3.8
2009
-0.4
2010
1.6
2011
3.2
2012
2.1
2013
1.5
2014
1.6
2015
0.1
2016
1.3
2017
2.1
2018
2.4
2019
1.9
Norb
Leahy, Dunwoody GA Tea Party Leader
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