Author Archives: Bob

Fun with inflation (or: hey, did I just lose a third of my stuff?)

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I was just fooling with various inflation and exchange rate calculators. Since we all know basic math, absolutely nothing in this post should be surprising. And yet…

“Who Wants to Be a Millionaire” premiered in 1999. Not exactly a long time ago, but adjusting for inflation, to receive an equivalent grand prize, a 2007 contestant would have to win about $1,240,600.

But let’s not forget the steep drop of the US dollar against most foreign currencies. In 1999, for example, the euro was worth an average of about 94 cents. In 2007, it’s worth $1.35. (This neglects the euro’s own inflation, which is a bit fuzzy, given the lumping together of many economies; if we accept the official target rate of two percent, total euro inflation seems reasonably approximated at a little under 20 percent or so during the period.)

So in constant 2007 dollars and euro, a “Who Wants to Be a Millionaire” winner in 1999 could have bought over 1.1 million euro worth of stuff. A 2007 winner can only buy about 740,000 euro.

Yikes. Is that right? If my math isn’t utterly screwy (which is entirely possible, although I think this is close), your dollars have lost one third of their buying power compared to the euro, just since you first heard Regis say “is that your final answer.”

While we’re at it, George Washington was offered a salary of $25,000. He declined, since he was already extremely wealthy, but that would be about $285,800 in 2007 dollars.

George W. Bush, on the other hand, gets paid $400,000 per year.

Adjusting for inflation, then, we pay George W. Bush about 40 percent more than George Washington was offered.

Make of this what you will.

CORRECTION: Turns out I was looking at the wrong numbers on the George Washington example.  His $25000 actually would be more like a half-million in today’s dollars.  My bad.  So Bush is not being paid more than Washington was offered.  And balance has been returned to the universe.

Say goodbye

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To Scientific American’s list of ten animals that will shortly become extinct.

A sample of the text, which will not make you feel warm and fuzzy:

Life does not appear to be improving for these gazelles, as caravans of foreign hunters continue to cross borders and mow them down with automatic weapons.

Yaaaaaarrrrrrgh.