Now money has several functions.
It's a store value and a unit of account and a means of transactions.
You can separate out those functions.
You can have a separate unit of account that is not money.
So they invented something called the UF, a Unidad de Fomento,
and they allowed its value to be tied to the Consumer Price Index.
Back then, they would publish in Chilean newspapers every day the exchange
rate between the, Escudo,
which was the currency they had then, and the UF.
So I looked it up today.
Now it's a website, used to be in the newspaper.
Well, maybe it's still in the newspapers.
But there's a website, valoruf.cl.
I looked it up this morning and
1 uf is 25,655.55 pesos.
Now you might wonder, why did they pick such a big number?
They didn't, they picked some small, maybe it was one to one, I don't know exactly,
in 1967.
But they've had so much inflation in their peso,
that it's up to 25,000 pesos per 1 UF.
And that is worth, at the current exchange rate,
between peso and dollar, $35.92.
So there's been a huge increase,
even though Chile has gotten its inflation more under control,
the price level has still increased 50-fold,
over 50-fold, since 1977.
But the US is not the haven of price stability either.
Would you believe it, prices in the US have gone up 24-fold since 1913?
That's not exactly a zero inflation environment.
And if you're saving for your retirement, for example, your grandmother buys you
a savings bond that matures in 2050, you should be worried, right?
What is that going to be worth?