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Inflation is differential and restructuring (2021)

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Re: Inflation is differential and restructuring (2021)

#21

Post by pjc50 »

roenxi wrote: post #15

If this perspective carries the day - which is plausible - then all it will reveal is that basically nobody in the voting public should care about inflation: 1) Inflation is not a useful metric for financial planning. If your investments are keeping pace with inflation then you have completely failed to position yourself correctly relative to the massive money creation going on. The gold price trend is posting consis…

> Inflation isn't a fair metric for referencing if wage raises

Arguably this is the only one that the voting public really do care about - the relation between wages and the cost of living is one that historically produces unrest, and that's because it's not related to abstract figures but to each individual's cash flow which they experience directly.

It's also one where decades of political effort have gone into making sure there's no mechanism for people to demand higher wages.

The alternative to printing money would be to raise money through taxation, which is also politically infeasible.

Re: Inflation is differential and restructuring (2021)

#22

Post by roenxi »

pjc50 wrote: post #21
roenxi wrote: post #15

If this perspective carries the day - which is plausible - then all it will reveal is that basically nobody in the voting public should care about inflation: 1) Inflation is not a useful metric for financial planning. If your investments are keeping pace with inflation then you have completely failed to position yourself correctly relative to the massive money creation going on. The gold price trend is posting consis…

> Inflation isn't a fair metric for referencing if wage raises Arguably this is the only one that the voting public really do care about - the relation between wages and the cost of living is one that historically produces unrest, and that's because it's not related to abstract figures but to each individual's cash flow which they experience directly. It's also one where decades of political effort have gone into mak…

> The alternative to printing money would be to raise money through taxation, which is also politically infeasible.

The scary thing, looking back on the 20th century, is that is probably what was said in a lot of places that then went through extreme political turmoil.

There have been a lot of instances where the only politically feasible road was printing money. That is typically the introduction in stories that end in poverty and/or war. No examples are leaping to mind of case studies where extreme money creation led to happiness and tranquillity. Possibly someone should try one of these infeasible options.

Someone has to do without when the government goes spending. We can pretend that nobody is paying, but if that becomes policy option #1 - as seems to be happening - then that sort of wilful ignorance on the part of the elites leads to real anger.

Re: Inflation is differential and restructuring (2021)

#23

Post by Terry_Roll »

Inflation, in all theories, doesnt measure the change in quality of the product either. Planned obsolescence is a stealth and legal form of product destruction that the buyer doesnt know about until after they have purchased something which is why the saying exists "buyer beware".

Re: Inflation is differential and restructuring (2021)

#24

Post by refurb »

roenxi wrote: post #15

If this perspective carries the day - which is plausible - then all it will reveal is that basically nobody in the voting public should care about inflation: 1) Inflation is not a useful metric for financial planning. If your investments are keeping pace with inflation then you have completely failed to position yourself correctly relative to the massive money creation going on. The gold price trend is posting consis…

Not sure why your reference looks at hourly wage and not total compensation. Seems like a selective choice of metrics.

"But between 1979-2019, whilst net productivity has continued to increase by an expected 70%, hourly compensation in the country is less than a fifth of that at just 12%."

Re: Inflation is differential and restructuring (2021)

#25

Post by kkfx »

The "monetary phenomenon" is a symptom the illness is private money: money MUST BE an unit of measure of many substrate (work, time, resources) we all agree, so MUST BE generated out of thin air (as it is) by STATES not by some privates that loan to the States generating the meaningless "public debt", a concept that simply CAN'T EXISTS.

If State's treasury generate money and all Citizens behind them exchange that money, taxes act for their own purpose witch is not financing States out of Citizens pockets but to redistribute richness to ensure a fair enough society where those who do more/are lucky get rewarded but still NOT being able to assume so much economical power to endanger the society at a whole.

Than inflation will not exists, or at least it's a kind of marginal concept almost non one is interested in.

If we are, like we are now, than inflation, mostly artificial, is a mean to cyclically made people poor to push a change against peoples and peoples will, like war or a new society built not to serve us humans but to serve very few of us who happen to be a human cancer, human as any cancer is part of the ill person, equally dangerous and lethal, to be cured by all means to try to survive...

If people do not understand that in sufficient enough mass, well a modern society is not possible and that means those who understand can only do their best to survive AGAINST other citizens-subjects waiting for a cyclic collapse and when this collapse happen, since there is no Democracy so no human rights try to get the hardest and inhuman revenge against those who happen to have, again, provoked the mess. Hoping that again in the history such big mess have made enough people understand who is the enemy.

If you think a separate society can work, like Indian's casts... Well... Try to look at history, yes for a certain time it work, but only for a certain time, so here the choice is moral in the sense: did we live ONLY for us or also for leaving an heritage?

Re: Inflation is differential and restructuring (2021)

#26

Post by TheOtherHobbes »

roenxi wrote: post #15

If this perspective carries the day - which is plausible - then all it will reveal is that basically nobody in the voting public should care about inflation: 1) Inflation is not a useful metric for financial planning. If your investments are keeping pace with inflation then you have completely failed to position yourself correctly relative to the massive money creation going on. The gold price trend is posting consis…

Inflation is covert politics. As everyday items - especially including housing - become less and less affordable, the political system looks more and more like a plutocracy with power concentrated within an oligarchy, and less and less like a democracy.

That's the baseline reality. The rest is just misdirection and handwaving.

If this seems implausible, consider that the governor of the Bank of England recently said that workers should be "consider carefully" whether they wanted to pursue pay rises, while at the same time the energy monopolies in the UK are threatening to put 40% of the population into fuel poverty by massively hiking prices during a time of record profits.

And the Bank's own senior staff are receiving huge pay increases.

Re: Inflation is differential and restructuring (2021)

#27

Post by quickthrower2 »

roenxi wrote: post #15

If this perspective carries the day - which is plausible - then all it will reveal is that basically nobody in the voting public should care about inflation: 1) Inflation is not a useful metric for financial planning. If your investments are keeping pace with inflation then you have completely failed to position yourself correctly relative to the massive money creation going on. The gold price trend is posting consis…

I find it interesting that house prices are kept out of inflation. But if you are forced to rent forever due to unaffordable housing, in your later years you might be paying $3000/m rent instead of $0/m mortgage interest. But that fact is conveniently left out.

Re: Inflation is differential and restructuring (2021)

#28

Post by orwin »

bojangleslover wrote: post #13

Why can't it be both monetary and non-monetary? Say it's a vector, one element per CPI category. Throw housing in for good measure. The direction of this vector can change due to non-monetary stuff like Russia and oil. But if all of the categories, especially those without clear non-monetary drivers, rise, then it's also monetary. So maybe X = p_monetary + Q_nonmonetaty where p is a scalar and Q is a vector. I think…

> Friedman was still right.

that would made his inflation theory the only theory he was right about.

Even in this case, 90+% of the money supply is created by private banks, so wouldn't that make big bank responsible for inflation?

Re: Inflation is differential and restructuring (2021)

#29

Post by em500 »

j7ake wrote: post #14

Inflation can be thought of as a high dimensional vector with dimensions equal to the number of objects you buy with money. Each person is affected by this inflation differently because they buy different things. To “solve” this problem, the government has decided to collapse this high dimensional object into a scalar number. And now we are seeing a divergence between this scalar number and the actual high dimensiona…

The government already publishes separate indices for a few hundred separate spending categories, ranging from pet food to parking tickets[1]. The reason nobody bothers to do what you suggest is that it's a ton of work for pretty much zero return: the resulting numbers are not actionable and won't change anybody's opinions from what they already believed to be true.

Granted, the BLS indices are not raw prices. But using actual raw prices is a few orders of magnitude more work, and the results are rather unspectacular (if you summarize the price changes into lower dimensions you get similar results as what the good folks at the BLS already did for you) [2]

[1] https://download.bls.gov/pub/time.series/cu/cu.txt, https://download.bls.gov/pub/time.series/cu/cu.series, https://data.bls.gov/cgi-bin/srgate

[2] http://www.thebillionpricesproject.com/

Re: Inflation is differential and restructuring (2021)

#30

Post by quickthrower2 »

j7ake wrote: post #14

Inflation can be thought of as a high dimensional vector with dimensions equal to the number of objects you buy with money. Each person is affected by this inflation differently because they buy different things. To “solve” this problem, the government has decided to collapse this high dimensional object into a scalar number. And now we are seeing a divergence between this scalar number and the actual high dimensiona…

You need a model of all brains. I don’t care that tomatoes have doubled in price in 24 months because I can eat something else. But if all fruit and veg doubles then now we are talking inflation! I can no longer get a nutritional diet at the same cost. But my neighbour eats only McDonalds burgers and is largely unaffected.

So I am not a matrix to apply to the vector. Maybe more like a neutal net.

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