Why Americans Are Richer Than They Realize

Editor's note: This week in Empire Financial Daily, we're introducing you to Alex Green, the chief investment strategist at The Oxford Club. For 16 years, Alex worked as an investment advisor, research analyst, and portfolio manager on Wall Street. These days, he authors three of the most read investment newsletters in the industry. In today's […] Not rendering correctly? View this e-mail as a web page [here](. [Empire Financial Daily] Editor's note: This week in Empire Financial Daily, we're introducing you to []Alex Green, the chief investment strategist at The Oxford Club. For 16 years, Alex worked as an investment advisor, research analyst, and portfolio manager on Wall Street. These days, he authors three of the most read investment newsletters in the industry. In today's essay, Alex explains why Americans are better off than many of us think... --------------------------------------------------------------- Why Americans Are Richer Than They Realize By Alex Green --------------------------------------------------------------- [Prediction X FINALLY Revealed...]( Whitney Tilson has spent most of this year gathering research, traveling the globe, and literally risking his life on two separate occasions. Why? To be able to make the boldest prediction of his entire career. One we're calling Prediction X. And now, he's finally revealing it to the world. [Just click here right now to instantly register for the event to stay in the loop](. (By clicking above, you agree to receive e-mail updates and reminders about Whitney Tilson's Prediction X event.) --------------------------------------------------------------- Last month, we learned that inflation in the U.S. declined in June to 3%... That's still too high, but just a third of what it was a year ago. Also last month, we learned that wages are growing faster than inflation. That's positive because it increases consumers' purchasing power – and may help the nation skirt a recession. This is a particularly welcome development because for the past two years wage increases were completely erased by price increases. Inflation – the thief that robs us all – had been running at the highest level in 40 years, making Americans feel poorer. Fortunately, consumer prices have not risen faster than wages over the long haul. This is clear when you look at time prices... A time price is the length of time the average blue-collar or unskilled worker has to work to afford something. Prices are expressed in dollars and cents. Time prices are expressed in hours and minutes. This is important because while we buy things with money, we pay for them with time. For example, if a barrel of oil costs $75 and you earn $15 an hour, the time price is five hours. If the cost of a barrel of oil rises to $80 and you earn $20 an hour, the time price is four hours. Even though the nominal cost is higher, the time price is lower. Time prices are an excellent way to measure increases or decreases in abundance over time for three reasons: - Time prices cannot understate or overstate inflation because current prices and wages are used at every point on the timeline. - Time prices are independent of currency fluctuations. (They can be measured in euros, yen, or any other currency.) - Time prices provide a standardized way of measuring changes in well-being. In their excellent book, [Superabundance]( authors Marian Tupy and Gale Pooley measured the costs of 50 commodities between 1980 and 2020. They didn't just find that the time prices of some of them went down. The time prices of all of them went down. And not by a little. The average time price decline of those 50 commodities – including oil, natural gas, wheat, cotton, soybeans, beef, corn, pork, and sugar – was a whopping 75.2%. Put differently, a blue-collar worker had to work 75% less to afford the same amount of those commodities. --------------------------------------------------------------- Recommended Link: [The only money-making acronym you need to know for 2023]( Soon, the acronym "PVAB" could be as commonplace as "ASAP" or "TGIF." But if you don't know it yet, you're not too late... By the time it fully rolls out, PVAB will have a bigger lasting impact on our society than the Internet. That's why some of the biggest names in the business – from Bill Gates to Jeff Bezos and Elon Musk – are pumping billions into it. To see how you can get massive returns from what could well be the biggest investment opportunity of this year, [click here now](. --------------------------------------------------------------- Of course, unless we're at the gas pump or the grocery store, we don't generally buy commodities but rather finished goods... Yet the time price decline in these was just as dramatic. And in many cases, more so. Over the same 40-year period, the time price of a utensil set declined 51%, a dishwasher declined 62%, a washer declined 65%, men's clothing declined 72%, a bicycle declined 74%, a vacuum declined 83% and a food processor declined 86%. And that's just for blue-collar workers. White-collar workers – especially those with a college degree – saw the time price drop even more dramatically. It's impossible, of course, to measure the 40-year time price decline in things like laptops, smartphones, and flat-panel TVs because none of these were even imagined in 1980. Home prices always seem high – and especially so today. Yet the cost of housing has also declined when measured in time prices. For example, the average price of a square foot of housing in 1970 was $15.33, and the U.S. blue-collar hourly compensation rate was $3.93, indicating a time price of 3.9 hours per square foot. In 2019, the average price of a square foot of housing was $88.89 and the blue-collar hourly compensation rate was $32.36, indicating a time price of 2.75 hours per square foot. In other words, the time price of a house declined by nearly 30%. Moreover, today's homes are more energy efficient, contain numerous major appliances, and almost always include modern features like central heat and air and granite countertops. When you spend less time laboring to feed and clothe your family, put a roof over your head, keep the lights on, and pay your bills, you are gaining the ultimate wealth: more time to do what you really want... That's not just prosperity. It's superabundance. This is a well-documented fact. Yet, surprisingly, many people get angry when they find out about it. In tomorrow's essay, I'll explain why. Regards, Alex Green Editor's note: Alex and Empire Financial Research founder Whitney Tilson believe a rare convergence could set in motion the biggest investment opportunity in more than a decade... sending a select group of stocks soaring. [Get the full story here before it's too late](. --------------------------------------------------------------- If someone forwarded you this e-mail and you would like to be added to the Empire Financial Daily e-mail list to receive e-mails like this every weekday, simply [sign up here](. © 2023 Empire Financial Research. All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from Empire Financial Research, 1125 N. 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