81–90 of 178 posts
EDIT for a typo.
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> inflation would spike Inflation did spike but what happened was that the definition was redefined in a deceptive way. Look at cereal prices and volumes. Prices have spiked and the containers/volumes have shrunk, but that's not taken into account under measures that exclude food prices. Energy prices have spiked. Gold prices have been running for more than 12 years. It's not to say we are seeing hyperinflation, but…
When people say that CPI doesn't show true inflation, what measure do they prefer to use instead?
I think the issue is that there probably isn't a "true" inflation. The main contention seems to be between those who use inflation as a measure of cost of living, and those who use it as a measure of policy-driven change in the value of money. Both views have their uses. Personally, I prefer the growth in money supply view because it seems to be less susceptible to manipulation by an agenda. The basket of goods is by necessity a small sample of the total cost of living, and I think that the main complaint lodged against it is that the goods are chosen and changed over time in order to portray a picture that's better than it would otherwise be. shadowstats.com has more information on how the CPI changes with selections in the basket of goods.
Using the money supply as the definition of inflation gets closer to the viewpoint I care about, which is trying to get a sense of how policy is changing the value of my savings and income. I like to look at a simple ratio of money supply growth to GDP growth for some idea of how policy is changing the value of money, but this too is fraught with danger because it ignores important things like technical innovation, changing resource bases, and money velocity. So, I think it's a matter of personal preference and probably the best policy is to look at it from as many angles as possible if it's something that's important for your decision making.
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I think OP might feel better if they knew about inflation protected securities.
When the issuer of those securities is the one defining the amount of inflation, that issuer has every reason to understate said amount, and the holder of the securities may still lose purchasing power. Consider e.g. Argentina's official inflation statistics versus 3rd party estimates. The difference is not explained by Argentina being a bunch of meanies but rather the system of incentives and particularly Public Cho…
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Here are some alternative CPI charts worth viewing: http://www.shadowstats.com/alternate_data/inflation-charts
Shadowstats has been discredited so many times that not even libertarians (such as myself) would go near that as a reliable source.
http://www.npr.org/blogs/money/2012/03/16/148751661/the-frid...
http://www.thisamericanlife.org/radio-archives/episode/405/t...
The Frontline episode 'The Warning' is related and also good:
It's disgusting because we don't get to say Aaron Swartz lived in a "freedom of information bubble".
Aaron Swartz downloaded some documents – was to be thrown in jail and eventually died by his own hand, perceivably because of the weight of the hammer being dropped down on him.
BUT...wreck the entire economy, cause thousands to lose their home, their job, their careers? NOTHING. What the fuck is going on?
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I doubt if RBS were the largest at the time. They're big, but they're not as big as JP Morgan, HSBC etc.
From their Wikipedia page: "Before the 2008 collapse and the general financial crisis, RBS Group was very briefly the largest bank in the world and for some time was the second largest bank in the UK and Europe" http://en.wikipedia.org/wiki/The_Royal_Bank_of_Scotland_Grou... Of course, it depends how you decide on the size of a bank... Also they had been on an insane binge of acquisitions, including the ABN Amro deal…
Worth it just for the email in the middle by a Citi underwriter. http://cybercemetery.unt.edu/archive/fcic/20110310201200/htt... I don't agree with every stylistic choice, but that's some of the best professional writing in the fling-a-firecracker-outside-of-your-silo circumstance that I've ever seen. ("I do not believe our company has recognized the material financial losses inevitably associated with the above Citi…
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When people say that CPI doesn't show true inflation, what measure do they prefer to use instead?
Here are some alternative CPI charts worth viewing: http://www.shadowstats.com/alternate_data/inflation-charts
It seems unlikely to me that the US has really had >7% yearly inflation for well over a decade. So what gives? The most compelling counterargument is simply that the charts in your link don't reflect reality.