[Expatriot]

$this->bbcode_second_pass_quote('Xenophobe', 'T')hat would depend on whether or not you are referring to real or nominal GDP I suppose.

[Keith_McClary]

$this->bbcode_second_pass_quote('Golgo13', '[')i]As long as we are counting services rendered but not paid, why aren't we adding in the value of sexual relations? Consider for example teenage sex. How much is that worth to the average teenage guy? With just a little more creative thought processes and by merely carrying current procedures to their logical conclusions we can really get our GDP revved up. Isn't that what we are implicitly doing anyway?

[Outcast_Searcher]

$this->bbcode_second_pass_quote('Keith_McClary', '')$this->bbcode_second_pass_quote('Golgo13', '[')i]As long as we are counting services rendered but not paid, why aren't we adding in the value of sexual relations? Consider for example teenage sex. How much is that worth to the average teenage guy? With just a little more creative thought processes and by merely carrying current procedures to their logical conclusions we can really get our GDP revved up. Isn't that what we are implicitly doing anyway?

[Golgo13]

I have no problem with goods and services being factored into GDP.

What I don't agree with is boosting personal income by billions through imputed values of free checking accounts and re-calculating homeowners income as though they were actually renting from themselves and using that to inflate GDP and real-estate industry figures.

Where do you draw the line?

Why aren't we calculating all sexually active women as workers of the sex industry and estimating the value of every unpaid sexual encounter they engage in and boost GDP by that amount as well? It's perfectly consistent with other imputations that are taking place.

Seems to me that the best way to avoid walking down that road of madness whereby you impute certain things but not others which have every right to be imputed as the things that do get imputed is just to do away with them entirely and use GDP to measure actual real transactions where financial remuneration occurs and thereby cut out all the distortion.

There needs to be some logical boundaries or else we need to start factoring people trolling on the internet into GDP figures amongst other things for the sake of consistency.

[Xenophobe]

$this->bbcode_second_pass_quote('Expatriot', '
')
The easiest way to rig the GDP numbers is to hedonistically underestimate the deflator, which leads to a falsely higher GDP.

Yes, it's being done.

Yes, it's intentional.

[Rod_Cloutier]

I started this post to make the point that we don't have to wait for inflation -it is real and here now. Clearly that point has been missed.

If the old pre-2008 situation where 'A' is your income, 'B' is the prevailing set of prices and 'C' is the resultant outcome. The outcomes have since changed.

A+B=C (2008- standard of living).

Now in the period 2009-2010, 'A' falls off a cliff for most people, except those lucky enought to keep their jobs or who are independantly wealthy. Now the equation reads:

(A-20%)+B(which is unchanged)=C which is a reduced standard of living. That is inflation. One side of the equation has changed producing an effect on the result.

Traditional thinking on economics of inflation says:

'A' is a constant, where 'B' increases signifigantly, so the equation reads:

A+(B+20%)=C where C is the same reduction in the standard of living as in the former example.

So it doesn't matter if A experiences a reduction (income),
or if B experiences an increase (cost of goods),
the result, C, (is always inflation) and a reduced standard of living.

Focusing only on the 'B' factor of cost, and ignoring the 'A' factor of income is not good economics.

[Novus]

Here is what JFK had to say about GDP:

$this->bbcode_second_pass_quote('', '
') "Too much and too long, we seem to have surrendered community excellence and community values in the mere accumulation of material things. Our gross national product ... if we should judge America by that - counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for those who break them. It counts the destruction of our redwoods and the loss of our natural wonder in chaotic sprawl. It counts napalm and the cost of a nuclear warhead, and armored cars for police who fight riots in our streets. It counts Whitman's rifle and Speck's knife, and the television programs which glorify violence in order to sell toys to our children.


"Yet the gross national product does not allow for the health of our children, the quality of their education, or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages; the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage; neither our wisdom nor our learning; neither our compassion nor our devotion to our country; it measures everything, in short, except that which makes life worthwhile. And it tells us everything about America except why we are proud that we are Americans."

[Xenophobe]

$this->bbcode_second_pass_quote('Repent', '
')
If the old pre-2008 situation where 'A' is your income, 'B' is the prevailing set of prices and 'C' is the resultant outcome. The outcomes have since changed.
A+B=C (2008- standard of living).

[rangerone314]

When health care, food, gasoline and college tuition all rise faster than "inflation", it should be obvious to anyone able to look past the nose on their primate face that government statistics on inflation are bogus.

Lies, damned lies, and statistics.

I like this site:
http://www.shadowstats.com/

[Rod_Cloutier]

Xenophobe show me your alternative math.

$this->bbcode_second_pass_quote('', 'i')f you said (Income) - (Expenses) = Net Income

[Xenophobe]

$this->bbcode_second_pass_quote('rangerone314', 'W')hen health care, food, gasoline and college tuition all rise faster than "inflation", it should be obvious to anyone able to look past the nose on their primate face that government statistics on inflation are bogus.

[rangerone314]

$this->bbcode_second_pass_quote('Xenophobe', '')$this->bbcode_second_pass_quote('rangerone314', 'W')hen health care, food, gasoline and college tuition all rise faster than "inflation", it should be obvious to anyone able to look past the nose on their primate face that government statistics on inflation are bogus.

[Xenophobe]

$this->bbcode_second_pass_quote('rangerone314', '
')$175.00 a year is less than people are forced to pay the Federal government in taxes, LOL!

[Outcast_Searcher]

$this->bbcode_second_pass_quote('Xenophobe', 'T')he people who assemble, calculate and publish the current GDP are just as smart as the guy who does shadowstats, matter of fact they are better because they actually gather and USE the raw data, versus just reassembling it in a different manner and pretending its better.

[diemos]

$this->bbcode_second_pass_quote('Outcast_Searcher', '
')Obviously, long U.S. bonds and wildly inflating commodity prices can't both be right

[Xenophobe]

$this->bbcode_second_pass_quote('Outcast_Searcher', '
')Xenophobe, do you think the current surge in MANY commodity prices has any predictive value for future inflation, whether in a year or in a decade?

[rangerone314]

One question about substitution... if you assume people are substituting good B for good A when good B goes up in price, why not ask if they are really equivalent or if one represents a decline in the standard of living.

I.e. if you stop buying tuna and start substituting catfood because tuna is too expensive, one might say your standard of living has gone down (because tuna has become inflated).

I wonder if North Korea ever employed substitution to calculate inflation. I wonder how many units of tree bark and grass would equal wheat and rice?

I'm not the only person who thinks the CPI is bogus and I'm not talking about shadowstats. How about http://articles.moneycentral.msn.com/Commentary/ByAuthor/BillFleckenstein.aspx ? I happen to respect his option quite a bit. (him and Jim Jubak) They tend to cut through the bull-poop.

Bull-poop exists because:
1) Politicians lie. (to keep themselves elected so they can look after the interests of the oligarchs who pull their puppet strings)
2) Economists are part of that crooked system and seem to have a vested interest in protecting the system, including deception.
3) Economists are smarter than scientists who worked under Bush administration. (Scientists weren't smart enough...or were too intellectually honest... to pre-edit their findings to suit their master's whims)

[diemos]

$this->bbcode_second_pass_quote('rangerone314', 'S')cientists weren't smart enough...or were too intellectually honest... to pre-edit their findings to suit their master's whims

[Xenophobe]

$this->bbcode_second_pass_quote('rangerone314', 'O')ne question about substitution... if you assume people are substituting good B for good A when good B goes up in price, why not ask if they are really equivalent or if one represents a decline in the standard of living.

[rangerone314]

I have an idea for improvement: don't substitute.

If Joe Schmoe get an AA degree because he can't afford tuition to get a BS or MS, because tuition has gone up, that is increase in price. Simply substituting what it costs for an AA degree now and comparing it to what a BS degree cost in the past is simply, BS.

If economists like Greenspan are so damn smart, why advocate keeping interest rates so low to create a housing bubble (following the tech bubble)?

Should be interesting when the government debt bubble implodes and no one buys treasuries. EVEN Greenspan is concerned about that now, of all people.

Of course, Pelosi is an even bigger idiot than Greenspan... she rejects the plan for cutting government spending.

Someone bring Volker back in, puh-leese!