z3r0c00l wrote: ↑Fri Oct 09, 2020 7:27 am
bottlecap wrote: ↑Thu Oct 08, 2020 11:17 pm
I’m not shocked that you agree with someone that agrees with you.
I guess your concept of "real data" is all in how you define inflation. You tend to agree with the definition the politicians prefer, but the fact that you can get a tv for cheap is not a product of deflation or noninflation, but because of increases in productivity not accounted for by government measures of inflation. Productivity advances significantly mask the affects of inflation, regardless of whether we're talking about TVs or sandwiches. It’s just that major advances in productivity in certain industries significantly understate the effect of inflation overall.
JT
Hate to agree with politicians on something but I don't understand how cheaper goods and services almost across the board are not an indication that inflation has been muted. In fact I think they are forces that are actively reducing inflation overall. A normal American today can go out and get more appliance for their $100 than they could have in 2010. Heck probably more than they could have in 1980 when $100 meant something. And they can get almost as much food, clothing, housing, medicine, or education as in 2010.
Yeah, that seemed like a pretty bizarre argument - that prices are lower because of productivity increase, not because inflation is low
. If prices are lower they are lower, that's deflation. If they are higher that's inflation. The reason why does not matter.
What else is much more expensive now than 10 years ago? (Meaning more than 20-30% over 2010 prices, which would be consistent with low inflation as measured by the CPI.) I don't even see that healthcare, housing, or college have gone up more than 2-3% per year in the past 10 years.
For the most part manufactured products have gotten cheaper, while services have gotten more expensive. Those relating inflation to the bizarrely specific price of their favorite sandwich, are paying more because they want the service of someone else making their sandwich for them. If they were buying the ingredients and making their own sandwich, they'd probably be seeing much less inflation in the cost of the sandwich.
And what do we care if stocks, bonds, and gold are where the secret inflation is going? No one needs to buy them to live a good life, unlike food, gas, housing, clothes, electronics. Those of us in the stock and bond game know the risks involved and in fact they are costly in part because we now live in a world of low inflation and low interest rates.
Yes, those things have nothing to do with the CPI, it's a consumer price index. So an index of things that are consumed, financial assets are not consumed. The CPI is meant to measure the "cost of living", not the cost of accumulating wealth.