Science Leadership Academy

It's been quite some time since I've written a blog, which is completely my fault; I am a week or few weeks late on these blogs. But, here goes the seventh of ten epic blog posts about the economy, and where it's headed.

So, I was searching for a bit, trying to look for something to blog about, and I ran across, a TIME article . I was reading it, and tried to make sense of it, but it was so hard to comprehend and understand. It seemed like it was a few paragraphs quoted from a report and written into an article. I thought it was from the present day, but I checked the date on it and it's from March 10, 1952. I started to break it down to try and understand it.

This is the first paragraph of the article: " Just as many labor contracts are tied to the Bureau of Labor Statistics index of consumers' prices, so billions of dollars worth of business contracts are tied to the BLS wholesale price index. Frequently, the delivered prices of new ships, houses, engines, etc. depend upon the fluctuations of this index from the time they were ordered."  From reading that a few times over, I know that back in 1952, labor contract were tied to the BLS. All of those contracts summed billions of dollars, and it's all tied to the BLS. The price of certain products depend on the BLS index. Interesting...

The article then went on to say--if you lived back then-- that just lasy week this important index underwent a big change. The index was brought up to date by including scores of products (television sets, antibiotic drugs, plastic materials, Orion, frozen foods, etc.) which existed with rarity when the old index was drawn up in 1932. So when the index was brought up to date it was such a big deal because it hadn't been updated since 1932. Several hundred other commodities have been made since then. Updating the index would allow a more accurate cross section of present day markets. The second change, which brought up criticism, according to the article, was that the index base started at 100 instead of 0. Thus, when the old index ended it was recorded at 174.8, which would only be 74.8% above "normal". The new index stood at 111.7, only 11.7% higher. The article ended with "Cried critics: a handy device for the Administration to hide the effects of inflation in a presidential election year."

It was interesting to read something about the economy and what was happening with it back then in 1952. The way this article was written was completely different then present articles written about inflation, and the economy. Back then, it seemed like the articles were written so that people with some kind of economical background could understand it. It's the same today, but the severity of it is lessened. Otherwise, it was an enlightening piece.