>There's either something not captured in inflation numbers My pet theory is that real inflation is higher than the official one, and is around 4-5%. The cause

>There's either something not captured in inflation numbers My pet theory is that real inflation is higher than the official one, and is around 4-5%. The cause of the inflation is a gradual loss of quality basically everywhere except high-tech. When the official inflation rate is calculated the basic assumption is that each item (which price is compared YoY) is exactly the same as it was last year. In another words, it assumes that its quality remains constant. However, it's not always true (I believe it rarely is). Sometimes quality goes up (e.g. due to the Moore's Law in high tech). Sometimes quality goes down (e.g. due to cheaper food ingredients). When quality goes down but price stays the same, the official inflation would be 0%, but the real inflation would be greater than 0%. I'm not aware if there is any way to account the change of quality in the inflation calculations. I suspect it's just not possible and therefore any published price-based inflation rates are bogus.