3 ms·
The article should be renamed to: "Why measuring inflation using the CPI is misleading" The CPI is designed by the government in order to give it plenty of sla
by moralsupply 6y ago
The article should be renamed to:
"Why measuring inflation using the CPI is misleading"
The CPI is designed by the government in order to give it plenty of slack to keep printing money.
- imtringued 6y agoNo, it is the opposite. Low CPI is a curse, something that has to be combated by creating more money. It's not an excuse, you really don't want your economy to suffer deflation. You are free to criticize ineffective central bank policies that drive inequality though.
- moralsupply 6y agoWith "low CPI" the government doesn't have to update government workers' salaries to compensate for real inflation. In the US, 1/6 of the workforce is paid directly by the government, which indirectly generate something in the range of 30-50% of all economic activity in the country. Hence why it's in the best interest of the government to state there's "low inflation": it doesn't have to spend too much with its payroll, while it can "profit" more from the money it prints.