WealthCycles is all about measuring stuff with stuff, and taking the effects of the devaluing fiat currencies out of the equation. In an effort to paint a true picture of the well being of the average American worker, we took a look at real annual earnings to judge the extent to which the Main Street American family budget has come under pressure since the financial crisis began.
The results are startling (chart below).
From before the financial crisis began, the cost of what families need to buy has risen significantly, while nominal wages are rising at their slowest rate in recorded history. In other words, the rate at which wages are rising is far slower than the rate at which the purchasing power of the dollar wages are paid in is falling.
In fact, when measured in real money—gold—the real average annual private-sector wage has fallen from 66 ounces of gold in 2006 to just 28 ounces today.
