[bochen777]

https://chapwoodindex.com/

https://www.mathwarehouse.com/calculato ... ulator.php


This means if you are making SIX figures NOW (2020) then in less than 14 years for a standard family of four you will be below the US poverty line!!!! (this is assuming the petrodollar hegemony doesn't completely erode)

Basically in less than half a generation the entire middle class will be wiped out ...

[dissident]

$this->bbcode_second_pass_quote('bochen777', 'h')ttps://chapwoodindex.com/

https://www.mathwarehouse.com/calculato ... ulator.php


This means if you are making SIX figures NOW (2020) then in less than 14 years for a standard family of four you will be below the US poverty line!!!! (this is assuming the petrodollar hegemony doesn't completely erode)

Basically in less than half a generation the entire middle class will be wiped out ...

[jedrider]

Housing costs has definitely been running at at least 10 percent inflation. Considering that that is the largest outlay of any family, that is what inflation would feel like to them. I'm glad the trade war with China has fizzled. At least, we still have cheap stuff available to us.

[Outcast_Searcher]

Gee, if only using social media for only 10 cities reflected general reality.

This is just like all the arm waving re shadowstats. It doesn't take a lot of brain power to look at real world experience in things like ordinary cars, considering technology improvements, housing in general (NOT just in a handful of expensive crowded cities), the overall shopping list at the grocery store, at Amazon, etc. to see that several decades of claims re shadowstats that real inflation is near 9% over several decades is absolute nonsense.

Same thing here, except the data set is highly skewed AND there is little to no discipline, backing of figures, etc. It's just what people emotionally report -- people wound up about inflation, which are almost certain to exaggerate on social media.

Re the math, yes, re the rule of 72, IF inflation were over 10% overall, then in 14 years, 100K would become worth 25K. (Inflation in the 70's and early 80's was NASTY. In the latter half of '81, supporting myself for the first time, EVERY TIME I went to the grocery store, I noticed prices had risen. THAT was damn scary. That's what real world 15ish percent inflation was like. NOT LIKE TODAY -- not at all, aside from medical and college expenses.

And, in the real world, long term, US stock investments have outpaced inflation by roughly 7% a year for the past 90 years (since good numbers have consistently been available). So it's not like real world inflation puts solid investors in the poor house, if they invest over the course of their career (vs. cherry picking short term results).

Aren't there enough real world issues to be concerned about without constantly looking for the latest made up thing, and throwing it against the wall, hoping it will stick?

What's next? That we should panic because the earth really is flat?

[evilgenius]

Yes, because everyone who sells anything is always trying to see if they can get more for it. If you don't include substitution in the toolkit for dealing with them, then they can raise prices as high as they wish. Economics relies, therefore, upon substitution for it to work. It is expected. Those who merely look at prices, and decry what they see, are taking things too simply. Unless there are forces driving up prices as a whole, across all substitutionary products, then the type of pressure theses inflation hawks talk about doesn't exist.

[The_Toecutter]

I keep my receipts.

From what I can tell, inflation regarding food prices is greater than 10% year over year for the things I purchase comparing two receipts in front of me, both from the same grocery store, one from the last time I bought groceries and the other from a year ago to the nearest week(to account for seasonal price differences). About every second time I go to the grocery store, I do see price increases in at least two or three of the things I buy on a regular basis, and I almost never see price declines in any of them on a YoY basis.

I purchase unprocessed or minimally processed foods and spices in their base forms, with minimal or no packaging, and prices have consistently been climbing far in excess of what the CPI claims they are, by at least a factor of 5. As far as I know, a pint of blueberries is still a pint of blueberries($1.39 last week versus $1.19 last year), a pineapple is still a pineapple($1.59 last week versus $1.29 last year), a bundle of cilantro is still a bundle of cilantro($0.89 last week versus $0.79 last year), and a bag of frozen green beans is still a bag of frozen greenbeans($0.99 last week versus $0.89 last year). This trend has occurred for everything I buy, nothing has escaped the price increase, and they've been each of similarly large percentages(10-25% price increase). Try a "substitution" around that one...

...and just because Alan Greenspan claims hamburger is steak, does not make it so...

You know what doesn't go up 10%+ on an annualized basis? My wages from the job I'm working at.

Comparing the amount of hours required to work at both minimum wage and median wage to buy like for like items is IMO a much better way to gauge the real inflation rate. It cuts through all of the adjustments, substitutions, debt availability, and obfuscations inherent in otherwise constantly changing markets and metrics. By this metric, Americans are paid 1/2 to 1/3 as much as they were 50 years ago. We now need twice as many hours worked at the median wage to support a family at a basic bare-bones 1970 level of living standard without luxuries and frivolities(just the basics, food, shelter, utilities, healthcare) versus what it would have taken in 1970.

By the metric of hours of work required at median wage to afford the basics, the average American's living standard is rapidly slipping, The CPI can claim low inflation all it wants, but Americans continue to feel as they are falling further and further behind. I don't think it's their collective imaginations playing tricks on them, even though they will spend many hours a day staring at those shiny new glowing rectangles that didn't exist in 1970 to distract themselves from reality while pundits tell them how great things are...

$this->bbcode_second_pass_quote('evilgenius', 'U')nless there are forces driving up prices as a whole, across all substitutionary products, then the type of pressure theses inflation hawks talk about doesn't exist.

[jedrider]

$this->bbcode_second_pass_quote('', 'F')rom what I can tell, inflation regarding food prices is greater than 10% year over year...

[The_Toecutter]

This guy seems to get it:

https://www.manhattan-institute.org/reevaluating-prosperity-of-american-family

$this->bbcode_second_pass_quote('', 'A') dramatic divergence between data and experience is confounding America’s policy debates.

...

The explanation is this: inflation does not measure affordability. Key assumptions built in to inflation indexes for the purpose of measuring the underlying, economy-wide upward pressure on prices are different from, and often counter to, the key assumptions necessary for assessing the economic choices and constraints faced by households. When analysts use inflation adjustments to compare household resources over time, they have chosen the wrong vantage point, and their view is obscured.

...

In 1985, the basket cost totaled $13,227, which, at a weekly wage of $443, would require 30 weeks of work to cover. In 2018, the basket cost totaled $54,414, which, at a weekly wage of $1,026, would require 53 weeks of work to cover.

...

[Outcast_Searcher]

$this->bbcode_second_pass_quote('The_Toecutter', 'T')his guy seems to get it:

https://www.manhattan-institute.org/reevaluating-prosperity-of-american-family

$this->bbcode_second_pass_quote('', 'A') dramatic divergence between data and experience is confounding America’s policy debates.

...

The explanation is this: inflation does not measure affordability. Key assumptions built in to inflation indexes for the purpose of measuring the underlying, economy-wide upward pressure on prices are different from, and often counter to, the key assumptions necessary for assessing the economic choices and constraints faced by households. When analysts use inflation adjustments to compare household resources over time, they have chosen the wrong vantage point, and their view is obscured.

...

In 1985, the basket cost totaled $13,227, which, at a weekly wage of $443, would require 30 weeks of work to cover. In 2018, the basket cost totaled $54,414, which, at a weekly wage of $1,026, would require 53 weeks of work to cover.

...

[The_Toecutter]

$this->bbcode_second_pass_quote('Outcast_Searcher', '
')No matter how hard you try to skew the overall data, the data is what it is.

[mousepad]

$this->bbcode_second_pass_quote('Outcast_Searcher', '
')Cars -- near zero inflation over time.

[Outcast_Searcher]

$this->bbcode_second_pass_quote('mousepad', '')$this->bbcode_second_pass_quote('Outcast_Searcher', '
')Cars -- near zero inflation over time.

[mousepad]

$this->bbcode_second_pass_quote('Outcast_Searcher', '
')However, complaining that you don't have a choice but to get much better products much cheaper doesn't change the reality re depreciation of electronic costs -- it confirms it.