From the Economist: “John Barrett, a cotton producer based in south Texas, explains that around March of last year most of the farmers he works with were happy to contract for that year’s crop at roughly 80 cents a pound. It was, historically speaking, a good price. Hardly anyone expected that, by harvest time, prices would have nearly doubled. In December cotton futures hit a nominal record of $1.59 a pound. The last time prices were so high was during the civil war and its aftermath.”
The Dollar price of cotton is at an all-time high, but the gold price of cotton is at an all-time low. Fiat currency and hard money are telling us completely different things. Both of them can buy the same thing, but one has seen constantly rising prices, and the other has seen constantly lowering prices.
In a market economy, lower prices should be the norm, not rising prices. Economies of scale and competition will bring prices down, and therefore increase the purchasing power of the common person. Instead, we have a fiat currency where the norm is for prices to rise every year. This is a monetary policy problem, not a market problem.