Gold in 1560 and Now

A friend passed me a print copy of the Telegraph newspaper during the week, pointing me to a story they thought I'd be interested in. It concerned the relative price of gold. Now, this isn't strictly a European topic, as it appears to be a worldwide study, but the starting point was 1560, when Queen Elizabeth I of England ordered the nation's coinage to be restruck to restore confidence, and the conclusions do involve Europe. What the chart they displayed basically said was, the purchasing power of gold is, relatively speaking, the same today as it was in 1560. To give you a better idea of what that means, the article went on to quote the work of Professor Roy Jastram, which suggested that for the bulk of the period from 1560 to now, an ounce of gold would always have bought you a good, but not spectacular, set of clothes. I must confess to some surprise at this study, as I would have expected the relative price of gold to be less now.