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The Ultimate Guide to Inflation

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Re: The Ultimate Guide to Inflation

#291

Post by tomohawk »

> If the government and central bank were to create a trillion new dollars and give the 100 richest people in the country an extra $10 billion each with that money, what would they spend it on? All of their physical needs and desires are met many times over already.

Rich people are rich because they invest when they can instead of spending. Poor people spend because they think that's what rich people do and they want to feel rich. Expecting rich people to suddenly behave like poor people makes no sense.

These wealthy people would invest the money, likely by buying up other businesses that didn't get the handout.

Re: The Ultimate Guide to Inflation

#292

Post by lotsofpulp »

sgerenser wrote: post #288
lotsofpulp wrote: post #171

Earlier quoted context omitted.

OOP max is just a trade off for higher premiums. Either you pay more per month for lower OOP max, or you pay more when the healthcare expenses happens. They’re all actuarially equivalent, per the metal levels of ACA. If anything, people should chose the high deductible high OOP max HSA plan so you can take advantage of tax benefits.

They're not actuarially equivalent if you qualify for "enahnced cost sharing" subsidies: https://www.healthinsurance.org/obamacare/the-acas-cost-shar...

Interesting, did not know about that. But 250% of federal poverty level is

> For coverage effective in 2021, 250 percent of the federal poverty level in the continental U.S. is $31,900 for a single individual, $54,300 for a family of three, and $87,900 for a family of six. (These amounts are higher in Alaska and Hawaii, since they have higher federal poverty levels).

That’s rough for a household of two, especially if they live in a high tax state.

Re: The Ultimate Guide to Inflation

#293

Post by matthewdgreen »

MontyCarloHall wrote: post #284
midasuni wrote: post #221

Earlier quoted context omitted.

Top model iPhones have increased price about 15% per year since launch

Yes, and they’ve also improved by orders of magnitude in terms of processing power, camera quality, etc. Today’s top-end iPhone probably would have cost upwards of $10,000 in 2015, if it were even possible to manufacture. As an aside, someone did a back-of-the-envelope calculation and found that the equivalent computing power of a 2014 iPhone would have cost $32 million in 1991: https://www.aei.org/technology-and-inn…

Yes, but so what? My current iPhone now devotes trillions of potentially-useful cycles to NOPs or processor sleep cycles. Does this mean that $32m of actual value is being created for me?

Re: The Ultimate Guide to Inflation

#294

Post by 127 »

zby wrote: post #254
127 wrote: post #249

Just throwing this in the air: in the 1970, getting off the gold standard made it possible to take much more debt in varied ways. This probably enabled the rich and the corporations to drain a much larger part of the economy for themselves. Also throwing this in the air: debt might not actually increase productivity unless it's explicitly only used for productive purposes. Even then it seems dubious. The whole argume…

"The whole argument of using debt to build a business smells fnny" - so what is the alternative? Do you believe that equity is the only way to finance a business?

Smells funny because it's used to defend so many different pathologies.

Alternatives? Break up big banks that are too big to fail. Build up many small, local banks that actually give a shit about their surrounding community.

Re: The Ultimate Guide to Inflation

#295

Post by hellbannedguy »

lupire wrote: post #40
cortesoft wrote: post #34

I've wondered what the effect our modern digital economy has had on consumer price inflation. Normally, an increase in money supply would cause consumer goods to increase in price, since more people are able to buy them and there is a limit on how much of any particular physical good is available. This isn't the case, however, for digital goods. If there are suddenly 100 million new people who want to buy a Netflix s…

Businesses charge what customers are willing to pay. If they have more money, they are willing to pay more. Competitiuis the countervailing force, but Netflix has exclusives and serials and network effects (fandoms and friends)

American has too many monopolies though, and I believe price collision in many industries is alive, and doing well, but has gotten harder to prove.

My mom wants to nix Comcast, and it's not that easy.

Re: The Ultimate Guide to Inflation

#297

Post by cableshaft »

bob33212 wrote: post #47
cortesoft wrote: post #34

I've wondered what the effect our modern digital economy has had on consumer price inflation. Normally, an increase in money supply would cause consumer goods to increase in price, since more people are able to buy them and there is a limit on how much of any particular physical good is available. This isn't the case, however, for digital goods. If there are suddenly 100 million new people who want to buy a Netflix s…

We are entering a Post Scarcity Economy. A lot of fiction books write about how this plays out. Regardless of what happens a lot of economic theory becomes less relevant. https://en.wikipedia.org/wiki/Post-scarcity_economy#:~:text=... .

The premise for the linked paper, "The Post-Scarcity World of 2050-2075", that "This convergence of peaking production is likely to lead to an age of scarcity. And yet that age of scarcity is unlikely to herald the end of the world. So what lies beyond scarcity?" makes no sense to me, although I have yet to read the whole paper.

Like, yes, we are depleting the Earth of its resources, leading to scarcity, but then that will end because the Earth will be out of resources, therefore we are post-scarcity and everything is free or nearly so? No sense whatsoever.

I think I can guess what the paper is about, that technology is going to develop that will save us from exhausting resources, but we're already inching pretty damn close to various tipping points that will lead to some really terrible things happening with various ecosystems and things are going to have to get a whole lot worse (and a lot of people are going to die) before we even can attempt to go back to some sort of eventual equilibrium. And tech is nowhere close enough to saving us from a good chunk of it.

So yeah, I guess there could be a 'Post-Scarcity World', but only for the fraction of life that will survive to see it (maybe none of that life being human at the rate things are going).

Re: The Ultimate Guide to Inflation

#298

Post by BurningFrog »

globular-toast wrote: post #289
BurningFrog wrote: post #104

Earlier quoted context omitted.

As long as people want things they don't have, there will always be scarcity. I'll believe the Post Scarcity Economy only when I see it.

Do you buy as much milk as you can afford? Most food is way beyond scarcity at this point.

No, but I buy more ribeye steaks and restaurant meals than I need.

I'm of course way beyond fearing starvation, but there is still no real upper limit to my food expenses.

Re: The Ultimate Guide to Inflation

#299

Post by woofie11 »

speeder wrote: post #164
woofie11 wrote: post #151

Earlier quoted context omitted.

Development and economic growth. In the Roman Empire, people lived 30 years and died. Most were illiterate. As a society develops, and has more excess resources, allocating more and more of those resources on keeping people alive, healthy, and educated seems reasonable. What's missing from the charts is quality. We spend a lot on healthcare, but we also now have multi-million-dollar MRIs machines and similar magic.

What you said is WILDLY wrong. People in Roman empire lived until 90 just like us. For example Seneca de Elder was 92 when he died. The reason why "life expectance" was 30 years was because child deaths, since that number is just an average. If you have 2 people living in a country, one is 100, and the other is 0, and the child dies, life expectancy is 50.

There was a random process. Plenty of people lived to be 90, and plenty of people died at birth.

The difference was that a random cut could turn into an infection and kill you. Hannibal lost vision in one eye due to an infection. Prior to antibiotics, you never knew if an infection would:

- Pass;

- Disable you; or

- Kill you

Same thing for a lot of other medical issues, as well as non-medical ones (such as a famine, bandits, or a random army passing through).

Re: The Ultimate Guide to Inflation

#300

Post by jpmattia »

Negitivefrags wrote: post #108
jpmattia wrote: post #79

The section on owner's equivalent rent (OER) is worth finding in the long article: OER accounts for about 1/3 of the CPI. However, when you view OER in light of the housing bubble around 2006, CPI was negligibly affected. IMHO, it is a large signal that CPI fails to accurately describe consumer inflation for a large segment of the population.

But in 2008 the housing bubble popped and the prices came back down to 2004 levels. Wouldn't you say then that the CPI was correct not to adjust too far to account for it? And if you think housing right now has increased a lot and the CPI isn't taking that into account, perhaps that says something about what is to come....

> Wouldn't you say then that the CPI was correct not to adjust too far to account for it?

My point was it missed the largest housing cost rise in multiple generations, despite housing being ~1/3 of the CPI. That it then also missed the downward correction is just more evidence that the CPI is uncorrelated to housing costs.

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