Semp[and anyone else with knowledge of money] I need some help.

[pitw]

 Not knowing [stuff in a pile hopefully on other side of log you sat on] about money, I want to know if I bought something 50 years ago for a dollar and sold it today for a thousand dollars.  What would the rate per annum be or whatever I'm looking for.  As in if I had invested that same dollar in a stock, what would it of had to do to come to the same amount .

[THO Game Calls]

Using compounding interest, 1 dollar invested at 14.816% over 50 years would net you 1000.28

Of course, that would be your NET interest rate, which means you would have had to have made more than 14.816% if you paid brokerage and account maintenance  fees out of your account over the 50 years.



Here is a calculator you can use to figure it out.  It only goes to two places, so the result will be 1002 at 14.82% or 997 at 14.81%

http://www.moneychimp.com/calculator/compound_interest_calculator.htm

[Hawks Feather]

$1 @ 14.8% interest per year for 50 years would give you $993.33, which is pretty close to your $1,000.

Jerry

[Hawks Feather]

I was too slow, THO beat me to it, but at least we had the same answer.

Jerry

[THO Game Calls]

The only question now is, where are you making 14% a year in the market?  And if you are, what the hell are you doing hanging out around here?   

[pitw]

[L] I don't play in the market .  Unless we are talking about the auction market where they try to screw me with a bunch of stuff that is irrelevant to what I'm doing. 
  OK so now we have established that $1 x something in interest will get me $1,000 in 50 years.  So now what if I got that same item for free[$0] and sold it today for $1,000.  What is the calculator going to say about that.   

[KySongDog]

[L]   So now what if I got that same item for free[$0] and sold it today for $1,000.  What is the calculator going to say about that.   

It depends.  If the item you are selling is similar to the Mona Lisa painting, and you sold it for a $1,000,  the calculator will say that you are an idiot.   

[THO Game Calls]

The math will always remain the same.  You would have a 25.89% gain using one cent as your original investment.   It's just pure math.


But Semp makes an excellent point.

The cost of the item may have been 0, but the market value of the item when you received it, and the current market value of the item today, will determine to a large degree, your gain or loss if you sell it for any amount of money.



More important if you do sell the item for 1000 bucks, would be your ability to create a weathered receipt from someone long dead, showing that you paid something like 950 bucks for it from them, when you have to visit tax man.