Sunday, July 12, 2015

Beer is cheap!

Incrementum —a Liechtenstein-based asset management company— looked at the amount of beer that an ounce of gold could purchase at Oktoberfest in Munich, for the sixty-five years from 1950 through the present. Presenting the data as a Gold-to-Beer Price Index, it found that the current beer-purchasing power of gold is quite high.

Gold-to-Beer Price Index

Many comparisons from everyday life show that gold is currently not valued at an excessively high level. While a Maß beer (one liter) at the Munich Oktoberfest in 1950 still cost a converted EUR 0.82, the price in 2014 stood between EUR 9.70 – EUR 10.10 (average EUR 9,90).

Thus, the annual price inflation of beer amounts to 4.2% per year since 1950.37 If one measures the beer price in gold terms, then one received 97 liters of beer per ounce of gold in 2014.

Historically the median is at 87 Maß, the 'beer purchasing power' of gold is therefore currently quite high. The peak occurred in 1980, at 227 liters per ounce of gold.

We believe it is easily possible that this level will be reached again. Beer aficionados should, therefore, so to speak, expect a rise in beer liquidity.

Vice-versa, these data show that beer is cheap. Now. In Germany. At the Oktoberfest.

But one wonders: if there were a Gold-to-'Craft' Beer Index, would the results be as sanguine?

  • A hat tip to Alan McLeod, at whose A Good Beer Blog, I learned of this story. McLeod noted the report's' economist humor: "a rise in beer liquidity." Ha, ha!
  • Read the original story at, published 8 July 2015: here. See the entire Incrementum report (as a pdf): here.
  • The Maß or Mass (pronounced [ˈmas]) is the Bavarian language word describing the amount of beer in a regulation mug, in modern times exactly 1 litre (33.8 US fl oz). Maß is often used as an abbreviation for the handled drinking vessel containing it, a Maßkrug (plural: Maßkrüge).

  • For more from YFGF:

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