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A $100k Prize for a Decentralized Inflation Dashboard

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Re: A $100k Prize for a Decentralized Inflation Dashboard

#61

Post by paulryanrogers »

lend000 wrote: post #42
bko wrote: post #40

Earlier quoted context omitted.

It would be very useful for on-chain financial derivatives based off a more accurate inflation gauge. I don't trust the official CPI numbers and don't see them as accurately reflecting my cost of living increases over the years. Couple in the fact that there are literally trillions in pension benefits tied to CPI, so the incentive to manipulate these numbers is huge. It's already very opaque. If you look at the const…

The CPI basically measures the median American's budget. So if wealth inequality is unchanging, then it's a decent measure of economy-wide inflation. Otherwise, it measures inflation x delta wealth inequality.

What if those budgets have significantly less buying power? Especially in critical areas like housing, healthcare, and education?

Re: A $100k Prize for a Decentralized Inflation Dashboard

#62

Post by acover »

gruez wrote: post #56
acover wrote: post #52

Earlier quoted context omitted.

Lots of people/businesses have a need to know if they’ll be able to meet their future expenditures with current savings. The issue is the generic basket of goods isn’t relevant for all people. For example, a condo with a reserve fund only really cares about construction costs in a single city. A retiree cares a lot about the price of nursing homes and in home care but may not even realize it. I expect if you can help…

>The issue is the generic basket of goods isn’t relevant for all people. but the BLS puts out figures for each category? https://www.bls.gov/news.release/cpi.t02.htm

Yes, I agree it’s not as useful if you trust government sources.

I’m not that familiar with USA inflation but with Canadian inflation statistics, certain categories feel way off - such as housing. As someone who is considering buying a house their measure is useless.

BLS numbers are also controversial - https://www.investopedia.com/articles/07/consumerpriceindex....

Re: A $100k Prize for a Decentralized Inflation Dashboard

#63

Post by Geee »

Real inflation is very hard to measure, because it's not only prices that change - more often the product loses quality while price stays the same. Either way, you are getting less for what you pay for, but only the price change is measured as inflation. In addition, people switch over to cheaper alternatives when products get more expensive - meat is replaced with vegetables for example. This changes the average basket of goods, and again doesn't affect inflation. There are also government programs and subsidies which are designed to alter the basket of goods or the prices of those goods.

Taking everything into account it seems that real inflation is higher than reported, and it might not be possible to measure it correctly by just tracking prices.

Re: A $100k Prize for a Decentralized Inflation Dashboard

#65

Post by nuclearnice1 »

lottin wrote: post #10
wrs wrote: post #2

OK, blockchain fans, I’m genuinely confused as usual… Can someone explain what the point is of collecting price data and then putting it on the chain with a smart contract to do calculations on it? If “censorship” is a problem, why not just broadcast/mirror the signed data? If the calculation is untrusted, why not just publish the source code and let people run it on the published data? What is the blockchain accompl…

These are people who think the government wants to censor their prices database... so not exactly geniuses.

Take a look at Argentina 2007-2016 [1,2,3]

[1] https://en.m.wikipedia.org/wiki/MIT_Billion_Prices_project

[2] https://www.hbs.edu/faculty/Pages/item.aspx?num=54491

[3] https://en.m.wikipedia.org/wiki/Cristina_Fernández_de_Kirchn...

Re: A $100k Prize for a Decentralized Inflation Dashboard

#66

Post by bellyfullofbac »

gruez wrote: post #16
usmannk wrote: post #11

Earlier quoted context omitted.

Technically it says "We'll invest $100k in the best entrant if you end up starting a company". I guess not bad if you're already working on this?

>if you end up starting a company How can you monetize this? The whole point is that the data is public for everyone to see?

I mean, these are crypto-crazed people with their alternate reality. Make a company, add the word "blockchain" in your mission statement, and join in the bandwagon/Golgafrinchan Ark Fleet Ship B?

Re: A $100k Prize for a Decentralized Inflation Dashboard

#67

Post by RobRivera »

Geee wrote: post #63

Real inflation is very hard to measure, because it's not only prices that change - more often the product loses quality while price stays the same. Either way, you are getting less for what you pay for, but only the price change is measured as inflation. In addition, people switch over to cheaper alternatives when products get more expensive - meat is replaced with vegetables for example. This changes the average bas…

yup, a great starting point would be commodity based. Even then those can be controlled, ie. public transport cost can be subsidized to keep that price point low for consumers, but subsidy is indirectly reflected by increased taxes...

Re: A $100k Prize for a Decentralized Inflation Dashboard

#68

Post by gruez »

bko wrote: post #54
gruez wrote: post #50

Earlier quoted context omitted.

>I don't trust the official CPI numbers and don't see them as accurately reflecting my cost of living increases over the years. What makes you think a NGO would do a better job? On one hand they might not have the same incentive to manipulate the numbers in the same way that the government would, but that would be replaced with an incentive to come up with whatever numbers that their donor base would like to see (see…

> What makes you think a NGO would do a better job? Maybe they wouldn't do better, but they wouldn't have a trillion dollar incentive and ideally there'd be competing metrics. > Are you missing a part of your argument here? You just say that a few categories make up 60% of the CPI, then immediately conclude that "it makes no sense that inflation has been flat". In the US, over the last 10 years housing, education and…

>Maybe they wouldn't do better, but they wouldn't have a trillion dollar incentive and ideally there'd be competing metrics.

The fact that no private entities tried to do anything similar (eg. bloomberg, s&p, msci) despite the massive incentive to do so (it's hard to price bonds/mortgages/loans if you can't trust the inflation numbers), suggests that the current number is already pretty good and/or that coming up with comparable numbers would be massively expensive. I think the problem is of expectations. You want a competitor to the BBC. You hope that it'll be something like propublica, but given the crowd associated with crypto, you'll probably end up with something like zerohedge.

>Health care: On a per capita basis, health spending has increased over 31-fold in the last four decades, from $353 per person in 1970 to $11,582 in 2019. [0]

That seems pretty consistent with the figures from CPI: https://fred.stlouisfed.org/series/CUSR0000SAM2

From 1999 to 2019, the source you gave (Total national health expenditures, US $ per capita) 154% increase. The "Medical Care Services" component of the CPI grew by 112% in the same time period. The figure you gave also doesn't account for an aging population (older people spend more on healthcare, irrespective of cost), so the "true" difference is probably smaller.

>Housing: Median home price was around ~210k in today's dollars ten years ago and is now ~314k [1]

Because looking at home prices is a poor way of assessing housing cost increases. If you factor in falling interest rates, the cost of a house has actually gone down. Houses have also gotten bigger and better equipped in the last few decades, which might increase the overall sticker price, but arguably shouldn't contribute to CPI increase.

see: https://awealthofcommonsense.com/2021/03/what-if-housing-pri...

>Education: The cost of college increased by more than 25% in the last 10 years [2]

The "Tuition, Other School Fees, and Childcare" component of the CPI has increased 37.4% in the same time period.

https://fred.stlouisfed.org/series/CUSR0000SEEB

Re: A $100k Prize for a Decentralized Inflation Dashboard

#69

Post by SpicyLemonZest »

gruez wrote: post #33
BenoitP wrote: post #24

What I'd really like to see is a multi-dimensional inflation vector that would also be future-proof. People really need diverse items: they need food, but also real estate, the prices of which are going through the roof currently, and that's a form of inflation. Also, there are many profiles of consumption. People have different needs. I'd say that it could be a 100 floating point vector; with the first 40 values arr…

>Also, there are many profiles of consumption. People have different needs. How do you get people to agree on which profile? I have a feeling it'll end up like the various unemployment statistics U-1 through U-6, ie. "you're a fool if you believe unemployment is at x% (U-3), the real unemployment rate is y% (your choice of U1/2/4/5/6, depending on the picture you want to paint)"

I don't think they necessarily need to agree. "How expensive is stuff getting these days?" is a broad, multidimensional question, and I think looking for a single numerical answer tends to confuse people more than it clarifies. (Even today, we have "core CPI" and "median CPI" and "chained urban CPI" and so on.)

Re: A $100k Prize for a Decentralized Inflation Dashboard

#70

Post by gregoryl »

RobRivera wrote: post #64

>Additionally, if the best dashboard uses Chainlink's crypto oracle technology to get the relevant data on-chain, they'll be eligible to receive an additional $100k grant in LINK tokens. Ill pass on that shoehorned scope

A slight reword would get a better gut reaction from me.

  Additionally, Chainlink has offered an additional $100k grant in LINK tokens if the best dashboard uses their crypto oracle technology.
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