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> other than things like a 12-pack of craft beer almost doubling over the past decade That's the thing about inflation, you need to look at a large basket of g
by dnadler 9y ago
> other than things like a 12-pack of craft beer almost doubling over the past decade
That's the thing about inflation, you need to look at a large basket of goods to estimate it. Different people feel price increases differently depending on what they buy. It's the aggregate number that matters at the end of the day.
- deleted 9y ago[deleted]
- opportune 9y agoRight. Commodity resources have pretty much universally decreased in price (relative to average income) as countries develop. The same can not be said for other areas such as housing and medical care. In fact the government's refusal to incorporate housing costs into conventional CPI calculations has been widely criticized as under-estimating inflation. As current official inflation metrics indicate that median incomes have stagnated over the past couple decades, this would suggest that they have in fact fallen. That's why life seems tougher now even though things like food and cheap plastic toys are cheaper than ever However, a decent counterargument is that since rents are already incorporated into CPI, adding housing prices would be a confounding variable more susceptible to different macroeconomic trends such as equity market inflations. Still, since a sizable percentage of people own houses and an even greater percentage want to own one in the future, I think it's a reasonable metric to add
- maxerickson 9y agoHousing is something like 1/3 of CPI.
- opportune 9y agorents, not house prices, unless I'm mistaken
- maxerickson 9y agoYes, that's "housing". It factors in the housing value of owned homes. (If you pay $1500 a month to buy a house where you could rent the equivalent for $1200, is the extra $300 really a cost of living in that area?)
- xkjkls 9y agoRents and house prices are heavily correlated.