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The USA Inflation Rate by Truflation Is 4.21%

truflation.com

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Re: The USA Inflation Rate by Truflation Is 4.21%

#51

Post by Sad90sNerd »

dez wrote: post #33
Sad90sNerd wrote: post #11

There is no way that matches reality, where does the person publishing such a chart even live? Do they buy eggs or pay rent? Here is a real alternative - John William's shadow stats. He simply measures inflation as the government used to in the 80s and 70s, and surprise surprise its more like 10% or 14% - no phony "Owner's equivalent rent". http://www.shadowstats.com/alternate_data/inflation-charts

https://www.reddit.com/r/badeconomics/comments/3zik5t/shadow... Shadow stats is comically bad economics.

They are making flat assumptions and trying to recreate the charts from the government CPI, its also a reddit post and not a serious bit of research which examined their actual methods. It could all just be correlation - who knows? All I know is that prices are rising very fast, and I tend to not believe the government. Food pyramid, Iraq war, COVID numbers, etc.

I think the FED and our banking regulations are the true "bad economics" and if you trust that, just go ahead and leave your deposits in the bank or invest in 4% yielding bonds : P

Re: The USA Inflation Rate by Truflation Is 4.21%

#52

Post by gruez »

jxramos wrote: post #24
Sad90sNerd wrote: post #11

There is no way that matches reality, where does the person publishing such a chart even live? Do they buy eggs or pay rent? Here is a real alternative - John William's shadow stats. He simply measures inflation as the government used to in the 80s and 70s, and surprise surprise its more like 10% or 14% - no phony "Owner's equivalent rent". http://www.shadowstats.com/alternate_data/inflation-charts

I wonder if we all tabulated all our expenses in the most fine grained detail and calculated our own personal rates of inflation how meaningful it would be to have percentiles of our population to say things like 50% of citizens experience a personal inflation rate of x.xx%. That would be very fascinating. I'm almost there myself with some web order scraping I've been playing with. It's a lot of work but once I tackl…

Sampling bias is going to be a real issue because there's going to be a strong incentive for people who think inflation is high, or is actively experiencing high inflation to participate. Also, if you're only tracking your expenses and not using a fixed basket, the index will end up including lifestyle inflation as well.

Re: The USA Inflation Rate by Truflation Is 4.21%

#53

Post by pengaru »

Pre-pandemic I was considering getting this[0] gateleg table from IKEA, it was $199.

I passed on it, then the pandemic hit.

In 2021 I decided I wanted to get the table and it was permanently out of stock because Pandemic, but still $199 on the site.

Because of its unavailability I ended up polling the site periodically, noting the price. Consequently this object became one of my reference points for pricing throughout the pandemic. As the price steadily rose, friends I'd mention it to would call out the lumber industry problems as why it's going up.

Well, as far as I can tell we're well past those lumber issues, and the price has only gone up further since...

  10/2021: $199
  11/2021: $229
  4/2022: $259
  6/2022: $279
  10/2022: $299
  2/2023: $319
  3/2023: $349
+75.37%

[0] https://www.ikea.com/us/en/p/norden-gateleg-table-birch-9042...

Re: The USA Inflation Rate by Truflation Is 4.21%

#54

Post by arcticbull »

jfengel wrote: post #44
ghayes wrote: post #15

Earlier quoted context omitted.

Theoretically isn’t the 2% target based on the BLS numbers for inflation? Thus, if we wanted to compare, the “Truflation target” might be more like 1% then? It’s weird to change the method but keep the arbitrary target.

The 2% target is rather arbitrary, and is independent of the measurement method. Both the target and all of the metrics are trying to capture the intuitive, handwavey notion of "a healthy economy". So they don't put too much stress on that 2% number. If the number were at 1.9% or 2.1%, they'd assume it's all in the margin of error. If it gets below 1% or above 4% for a while, they apply some tools in the direction of…

Yeah, something something Philips Curve. [1]

[1] https://www.stlouisfed.org/open-vault/2020/january/what-is-p...

Re: The USA Inflation Rate by Truflation Is 4.21%

#55

Post by Sad90sNerd »

dragonwriter wrote: post #48
Sad90sNerd wrote: post #23

Earlier quoted context omitted.

Ok, if you were the government and I asked you to measure rent increases - what would you do? Would you look at the cost of renting on average in a city and compare them to last years? Seems like the most obvious way... Well, that is not how the government does it now. It currently uses a metric called "owner's equivalent rent". Where instead they call up people who own there houses and ask them how much they would r…

> Ok, if you were the government and I asked you to measure rent increases - what would you do? Would you look at the cost of renting on average in a city and compare them to last years? Seems like the most obvious way... Well, that is not how the government does it now. Except, in fact, it actually is how they do the rent portion of CPI. (Well, its not city rent averages, they do same-unit rent changes and average t…

Even if that is true (which I am doubtful of), what is the merit of OER at all? Why use it if its A) not really what people are paying B) relying on people not in the market to guess what the going rate is and C) consistently underestimates actual rent.

I see no purpose for it besides the government liking the C) part...

Remember folks, inflation is "temporary" or, i mean, "transitory", or I mean, yes we have inflation, but its the COVID supply chain, OH oh sorry its Putin's fault. Yes lets stick with that...

Re: The USA Inflation Rate by Truflation Is 4.21%

#56

Post by PragmaticPulp »

pengaru wrote: post #53

Pre-pandemic I was considering getting this[0] gateleg table from IKEA, it was $199. I passed on it, then the pandemic hit. In 2021 I decided I wanted to get the table and it was permanently out of stock because Pandemic, but still $199 on the site. Because of its unavailability I ended up polling the site periodically, noting the price. Consequently this object became one of my reference points for pricing throughou…

Furniture prices went way up during the pandemic.

People were staying home more and spending less on going out. Budgets went toward improving homes.

Furniture was out of stock everywhere. Companies raised prices but demand continued, so they kept raising.

Re: The USA Inflation Rate by Truflation Is 4.21%

#57

Post by jarsin »

nostrademons wrote: post #16
echelon wrote: post #10

Big delta from the Fed's number. Much more promising. It might give the Fed a little bit of wiggle room in dealing with the banking situation. If we can weather these last few blips, we might be back to smooth sailing soon. The economy is buzzing along by all other measures.

I'm pretty sure the Fed is not looking at Truflation. If you want to predict Fed movements, your best bet is probably the Core PCE: https://www.bea.gov/data/personal-consumption-expenditures-p...

The feds view is using lagging data. Truflation is using realtime data. This is why the fed gets it wrong both ways.

Truflation says the housing data the fed uses is 9 months behind them.

Re: The USA Inflation Rate by Truflation Is 4.21%

#59

Post by nostrademons »

jarsin wrote: post #57
nostrademons wrote: post #16

Earlier quoted context omitted.

I'm pretty sure the Fed is not looking at Truflation. If you want to predict Fed movements, your best bet is probably the Core PCE: https://www.bea.gov/data/personal-consumption-expenditures-p...

The feds view is using lagging data. Truflation is using realtime data. This is why the fed gets it wrong both ways. Truflation says the housing data the fed uses is 9 months behind them.

No argument there, but OP's point was that the Truflation stats might give the Fed more wiggle room, since they're significantly lower than official CPI figures. Not if the Fed neither looks at nor gives any credence to the Truflation numbers. The Fed will continue to use lagging data and continue to make decisions that harm the economy.

(FWIW, the Fed does look at a variety of data sources, and the lag in housing numbers is well known to them. However, y'know who also uses lagging data when setting prices? Real estate agents. Comps usually go back a year or so, and anything sold in that time period is fair game. Y'know who else? Employees, when figuring out how much of an annual raise is fair. And so the Fed's decision-making process isn't strictly incorrect; if they don't hold rates high enough to actually see the inflation numbers go down, then the firms who set prices also aren't going to see the numbers go down when deciding how much to ask for.)

Re: The USA Inflation Rate by Truflation Is 4.21%

#60

Post by californical »

latchkey wrote: post #37
dragonwriter wrote: post #27

Earlier quoted context omitted.

> “data sources and metrics created by developers and crypto investors” I... if I had to name groups of people I would not trust to build data sources and metrics for broad economic measures, “developers” and “crypto investors” would both be very close to the top.

Seriously, why disparage people like that? I know some insanely talented developers who work in the crypto industry. Comments like this seem really against the spirit of HN. Reminder: https://news.ycombinator.com/newsguidelines.html

They may be talented developers, but I don’t see what that has anything to do with their ability to understand complex economic systems. Entirely different skillsets.

But people in crypto tend to think they understand economics better than economists, so I think that the criticism of the article’s methodology is fair

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