Busting the myth again of the dollar's declining value

(Hat tip to ArnoTrader for this one!)

More misleading analysis purporting to say that the dollar has lost 95% of its value in the past 100 years.

Let us take at the period from 1913-2006, where we have complete data. So what do they mean, when they say the dollar lost 95.1% of its value in those 93 years? Essentially, an average good/service that cost $1 in 2006, used to be priced at 4.9 cents in 1913. In other words, the average price level of goods/services increased by 1930% since 1913. True, but guess what, average earned income increased by 6560% during the same time period. Average earned income rose from $740/yr in 1913 to $49,300/yr in 2006. Adjusting for inflation, $740/yr in 1913 is $15,000/yr in 2006 dollars. Average incomes, not only kept pace, but beat price inflation by 230%. Read full article here.

In fact, what I have been saying and writing for a long time. When reduced to the common denominator of hours of labor required to purchase a basket of goods, the dollar's purchasing power has gone up mightily.