No one knows how much the government can borrow

> rather than taxes being a "necessary evil" policy to pay for some other good, they can actually be reconstrued as positive goods in and of themselves: to price externalities (pollution tax) or discourage behavior (sin tax), etc.

You can think of the very high marginal income taxes prior to Reagan, even higher prior to JFK as 'sin taxes'. People opposed to high marginal tax rates like to point out that those high taxes didn't produce more revenue. But MMT thoery would tell you revenue was never the point. The point was to discourage people with the power to divert money into their own pockets from doing so.

There certainly is a big Mac index.

The price of big Mac is used as purchasing power proxy.

McDonald's is pretty efficient in their supply chains to use as rough proxy to real world idea of how things are. The variations you talk about don't add up to 100% change in price OP mentions.

Exactly. Once you factor in "who owns that debt" the picture changes. See 'external debt by country'

https://en.m.wikipedia.org/wiki/List_of_countries_by_externa...

> No, there are not.

Yes, there are. What a tiresome exchange.

What the CPI represents is rather narrow, which is described right in the CPI reports, along with links to their numbers https://www.bls.gov/news.release/cpi.nr0.htm

Ultimately the faith in the CPI depends on what you want to ignore. The sampling is 29% of the wage earners from the most populated centers. https://www.investopedia.com/articles/07/consumerpriceindex.... Of course it's biased toward consumerism, but that's a huge problem with calculating the cost of anything today. Even with that caveat, is that a 1.8% increase in shelter cost from 2019-2020? That's not realistic.

Like the unemployment rate, these stats have long ago become politicized to the point they are a reflection of what needs to be portrayed. These numbers (CPI, GDP, Unemployment, etc) can and are manually changed by whatever ad-hoc method that is convenient. It's important to have some insight as to what's going on that would result in a huge disconnect, rather than handwave off the "cranks" who must be complete morons because they are "the other side".

> So if the GDP grew "only" ~2.5%, then any inflation above that, would mean were actually in a recession/depression for the last decade

What you consider a recession and I consider a recession are different things. Consumerism skyrocketed and domestic manufacturing cratered. Commercial property has also bottomed out. The velocity of money has slowed ~2012 until we're at the height of efficiency in velocity...which is molasses. Money doesn't move on anything that isn't land, because that's the lowest risk at this time and middle markets/individuals are failing or barely subsiding.

> If inflation is >5% (per the truthers), then the economic growth would have had to been on top of that, for a nominal growth rate of >7%.

Economic growth is about debt growth, like it or not. All the new debt is in real estate (stocks and bonds for companies and individuals), which is where the inflation is living. see property prices in Los Angeles growing at about 7% year over year, same as a bag of cheetos and wholesale soda costs...but the monopolies are still duking out loss leading with $1 fountain sodas so nobody cares.

Property is immune to the deflation (cannot be outsourced, et al) and the only debt that banks are interested in, on a risk basis. Due to the ungodly improvements in efficiency (and outsourcing) most goods have been subject to massive deflation and have made the functional monopolies (and new tech) look super valuable, driving the tech stock frenzy. Unfortunately, those efficiencies have been maxxed out, more or less. You won't be seeing TVs drop from 700 to 70 (like they did from 7k to 700), the will go back up along with the food prices that have been slowly rising. This rise has been balanced out by the fantastically low prices of goods (eg 40oz Bag of Cheetos have risen just under 10% year over year) or loss leaders duking it out ($1 sodas from Hardees/McDs). Too bad your fast food is still routinely over 15$ a person.

I don't think it's prudent to throw my hands up and say "I just don't understand why things are the way they are, when I have a single number to tell me everything is ok." The CPI is a garbage index. There are reasons why the markets are the way they are and it's not hard to see, regardless of what the US gov wants to say about it.

One problem is that the IMF adjusts the currencies in the SDR basket over time. It would be feasible for a private issuer to offer something based on the current SDR basket. But next time the IMF reweighs the basket, they will have a problem. The reweighing operation is designed to not the change the value, but a private issuer that wanted to follow the SDR basket as it changes would have to move quickly in the market to reweigh its assets, and there would be a risk they would lose out in the process. (Maybe they could hedge against that risk, but that would incur an added cost.)

I think the biggest reason why this product isn't offered, is there is no great demand for it. Anyone can do the same thing themselves just by buying the underlying currencies. But, investors probably would take more interest in genuine SDRs issued by the IMF than in some private company's simulation of them. Real SDRs would have far less counterparty risk and operating expenses than such a simulated SDR would have.