Tag Archives: silver

Silver Oil Ratio

The price of silver dropped in the last days significantly. Oil prices are relative stable at the moment. Since I am interested in this shiny metal, I wanted to know if there is any correlation between silver and oil prices. Oil is needed for almost every aspect of our life, so must be the case with mining silver. On the Internet I found an article from 2005 [link]. It was very interesting to read it, but it is a bit outdated. So I decided to make a simple Excel-Sheet for my self for the period between 2006 and 2013. In the chart you can clearly see the correlation between both prices. If you find this helpful, you can share it with the buttons below.

Download Excel-Sheet

Commodity prices in Weimar Republic 1913-1923

This is the first post I will write in English, so please excuse my mistakes. I saw videos on YouTube, where some people, including Mike Maloney in his “Hidden Secrets Of Money”, told us that an ounce or two of gold had bought a house in the past. I think Mike Maloney said, he didn’t search for this, but heard it from the Swiss investor Marc Faber. So I wanted to know if this is a real fact or not. History and specially the history of money was ever interesting for me. For few years I have been living in Germany and I have access to the library of my university, so I started looking for old newspapers. And as many other things, the Germans have done a very good job in scanning old newspapers. It was a bit hard work, because of the old German font used in the books and newspapers. Anyway… in the next lines I will not only present to you some commodity prices, but some other interesting facts in the time before the World War I and the Hyperinflation in 1923.

As first I want to show you two of the major currencies in Europe at this time: The Swiss frank and the Goldmark. Switzerland at time was part of the so called Latin Monetary Union. So the value of the Swiss frank was: 1 Frank = 0,290322g Gold = 4,5g Silver. The German Goldmark itself: 1 Mark = 0,358g Gold = 5,55g Silver. At this way you can always determine what was the commodity price in gold and silver. So lets get started!

1913-09-11

House with garden 28 000 M = about 322 oz. gold [1]

1913-09

Car = 1 600 M Motorcycle (second hand) = 250 M
Bicycle = 25 – 40 M Pushchair = 15 M
Sofa = 25 M Stove = 20 M
Basler Bank: Interest rate 3,5% – 4,5% House (Between Karlsruhe and Freiburg) = 6 000 M.
Rent 3 floor apartment = 400 – 600 M 250 decare near Basel (covered with forest) = 40 000 M
Rent 5 floor apartment = 1000 M House (5-6 rooms) Freiburg = 25 000 M
Rent 10 floor apartment = 1500 M House + (32,5 decare) near Freiburg = 12 000 M

1914-06-02 [2]

4 Pound white bread 0,60 M
4 Pound rye bread 0,81 M
1 Pound veal 1 M
1 Pound pork 0,85
1 Liter Milk 0,23 M
4 Eggs 0,50 M
 

1914-06-10[3]

Car 6 P.S. = 450 M 2,5 storey house (Freiburg) = 18.000 M

I also find an interesting article, called “Papier statt Gold” or in English “Paper instead of gold”. It describes how the Germans at that time (1913-09) do not very like the Paper-Marks. Of course you can always change your Paper-Marks for Goldmarks because of the Gold standard, but the people prefer the Goldmark instead of Paper-Marks. You can see in the table the percentage of Paper- and Goldmarks in circulation [4]:

 

1908

1911

1912

Banknotes

27,76%

28,37%

30,08%

Goldmarks

72,24%

71,63%

69,92%

 

Then in August 1914 the World War I started. Weimar Germany needed money to finance the war. And at the beginning of august the gold standard was removed. I found another interesting article [5]: Many business owners didn’t want to accept the Papermarks. They were committed to accept the Papermarks or their localities would be closed.

1919 – So the war ended, Germany have lost and should pay a lot of reparations. The economy was bad and there was a lot of unemployment at this time.

1919-12

Apple/Pear 0,60 – 2 M
Chicken (alive) 14 – 20 M
Hen (alive) 25 – 30 M
Goose 60 – 75 M
Duck 25 – 30 M
Dove ?!? 5,50 M
Ladies shirt 18 – 27 M

1919-12-20

1 Swiss Frank 874 M

1919-12-28

Hotel Karlsruhe 185 000 M
Hotel Basel + 125 decare 185 000 M
Cafe-Hotel 70 000 M
Small Hotel 70 000 M
 
If we here make simple calculation: a hotel in the town of Basel costs 185 000 Marks. In Swiss frank about 212 CHF. As I noticed the Swiss frank had a value of 0,290322g Gold. So at that time the hotel really costs 2 ounces of gold.
 
I also found what was the income tax at the end of 1919 in Baden (region on the east bank of the Rhine in the southwest of Germany):
 

1919-12 Income Tax in Baden

1 000 M 100 M
10 000 M 1 450 M
21 000 M 4 110 M
31 000 M 7 080 M
50 000 M 13 000 M
101 000 M 38 900 M
200 000 M 100 000 M
301 000 M 166 300 M
500 000 M 60 %

1923-01-01

1 $ = 7 267 M Flour (50kg) = 42 000 – 47 000 1 kg (900) Silver = 144 000 M

1923 Banknotes in circulation

1923-02-23 3 123 Milliard Mark
1923-03-24 4 000 Milliard Mark

1923-03-04

1 $ = 22 600 M 1 Swiss Frank = 4 275 1 kg (900) Silver = 445 000
Kidney bean = 1 600 M Pea = 1 600 Rice = 1 700

1923-04-05

1 $ = 21079 M 1 Swiss Frank = 3865 M 1kg (900) Silver = 420 000 M

1923-10-19

300 decare = 120 000 Goldmark House (5 rooms) = 25 000 Goldmark
Very interesting fact: At the pick of the hyperinflation in 1923, the people stopped accepting the Papermarks, and accepted again only Goldmarks. So at that time a house costs again as before the war about 288 ounces of gold.
 
At the end I will show you two more tables with prices:
 
Deutsche Bank share in Mark between 1913 and 1923
1913-09-01 247
1913-09-30 248,25
1914-06-02 239,75
1914-06-09 240
1914-06-29 237
1919-10-28 250
1919-12-01 249
1919-12-18 260
1923-01-03 8 350
1923-01-29 20 000
1923-02-28 27 750
1923-03-28 22 800
1923-04-27 28 500
1923-05-28 50 000
1923-06-29 300 000

Flour (100kg) – Q1 1923

1923-01-22 84 000 M
1923-01-29 112 000 M
1923-02-05 140 000 M
1923-02-12 125 000 M
1923-02-19 110 000 M
1923-03-04 140 000 M
 

So at the end, for every commodity there are picks and downs. It depends on: where the house is, in witch country it is, in witch currency and what the people need more (after a war: house or food) and so on.

I hope you will find my post interesting and if so, please share. Thanks and have a good day!

p.s. And a photo of 20 and 50 million Mark from 1923

IMAG0800


[1]Freiburger Zeitung 1913-09-11 Zweites Morgenblatt, Page 3.
[2]Freiburger Zeitung 1914-06-02 Zweites Morgenblatt, Page 2.
[3]Freiburger Zeitung 1914-06-10 Zweites Morgenblatt, Page 3.
[4]Freiburger Zeitung 1913-09-21.
[5]Freiburger Zeitung 1914-08-04.