General Motors stock is in a pickle. Everyone has documented how low it has fallen. On Oct 9, 2008, the stock closed at $4.76. All the newspapers are saying how this is the lowest share price for GM since 1950.

What NONE of them mention is what the inflation-adjusted equivalent is. Five bucks in 1950 was worth a lot more than it is now.

According to the Inflation Rate Calculator at InflationData.com, there has been almost 800% inflation between 1950 and 2008. So five dollars in 1950 would buy what takes forty dollars to buy today.

Inflation calculation from 1950 to 2008

Conversely, five dollars today buys what 62 cents bought in 1950.

Therefore, a five dollar close in 1950 is equivalent to a forty dollar close today, and a five dollar close in 2008 is equivalent to a 62 cent close in 1950.

So the stock close today is actually far worse that it was back in 1950. Toyota as a car company didn’t exist. GM was on top of the world. And people actually wanted to buy GM cars. GM’s car launches were greeted with exhilaration, and front pages news.