Summers: Inflation Reached 18% in 2022 Using the Government's Previous Formula

Post by ein0p » Sat, Apr 13, 2024, 9:01 PM UTC

ejstronge wrote: post #42

ein0p wrote: post #36

Earlier quoted context omitted.

Those aren’t fancy cuts or prime grade beef. Just regular steak at Kroger or Costco. Go see for yourself if you’re in the US. It really feels like the bottom is about to fall out from US economy. I don’t know how the low income families deal with a 30% increase in their grocery bills which were a significant chunk of their spending even a few years ago. Nor how they pay rent which has also increased massively.

> Those aren’t fancy cuts or prime grade beef. Just regular steak... I don’t know how the low income families deal with a 30% increase in their grocery bills I don't think low income families are buying steak - and price increases in luxury goods can understandably grow faster than in staples like non-steak beef.

Post by woodruffw » Sat, Apr 13, 2024, 9:02 PM UTC

tossandthrow wrote: post #40

adriand wrote: post #33

Earlier quoted context omitted.

But it’s not like our standard of living has remained static while we need to work more. A lot has changed. In 1960 the average single family home was 1300 square feet, now it’s more than double that, and it’s packed with amazing amenities and entertainment options. What would an iPad cost in 1960? Obviously the question is kind of nonsensical and yet on the other hand, if you were to try and quantify the price of ou…

The main thing is, that I could actually support a household of 6 people on a single income if I was allowed to fix the comfort at the 60s level. 1. No flying on vacation and only simple camping as vacation 2. No technology: Computers, phone, television. Nothing, and no associated costs with subscriptions, etc. 3. Eat like it was the 60s, mainly potatoes (I am from Northern Europe). That said: I truly believe in the…

Post by [deleted] » Sat, Apr 13, 2024, 9:02 PM UTC

caesil wrote: post #37

I don't really understand the argument at the heart of this article, which is "we should include interest rates in CPI". How do interest rates effect everyday people exactly, other than price inflation on goods and services (which is included separately in CPI)? The only way seems to be interest rates on personal loans and mortgages. So if anything, we should only include interest rates in proportion to how many peop…

Post by mistermann » Sat, Apr 13, 2024, 9:03 PM UTC

randomdata wrote: post #41

tonymet wrote: post #16

I recommend people use many different indicators to get a mental model of inflation, and you will notice that CPI does not represent inflation well. The memes of Arby’s 5 for $5 becoming 4 for $10 are more informative than the CPI numbers. Don’t let the shock at the grocery store wear off – it’s real and painful despite what the news tells you. True inflation would measure the amount of prosperity achieved per hour w…

> In other words you had 1 man working 50 hours a week afford a house... With inflation, we want to know about the change in value of the dollar only . We don't want to factor in the change in value of houses, food, etc. There is a place for understanding that too, but inflation is not it. Something like a cost of living index is more suitable to that kind of information. On that note, houses are unquestionably more…

Post by ethbr1 » Sat, Apr 13, 2024, 9:04 PM UTC

PKop wrote: post #51

bdjsiqoocwk wrote: post #49

Earlier quoted context omitted.

Including interest rates in CPI muddles the distinction between the price of something vs how to fund the acquisition of something.

Interest expense is a real cost people pay. Why ignore it?