Recession lobster: The plummeting price of a former luxury


In the best of times, it's easy to imagine that commodities and currencies are stable, unchanging things. After all, if gold was worth $400 an ounce yesterday, there is no reason to imagine that it will be worth a great deal more or less tomorrow. Similarly, if the dollar was able to buy a certain amount of goods or services last week, then one can be forgiven for imagining that it will be able to buy a comparable amount of goods or services next month. In good times, prices don't fluctuate all that much, and we can make long term plans, secure in the belief that the economy or the markets won't leave us holding the bag.

Unfortunately, the past few months have been a long, painful lesson in the pitfalls of currencies and commodities. When the value of gas skyrocketed and the value of the dollar plummeted, prices that had long been stable began to bounce up and down. Stocks that were once worth a fortune were suddenly devalued, while gold that was once worth a reasonable amount was suddenly worth a whole lot more. In the midst of this crisis, some necessities began to look like luxuries and thrift once again became a virtue.