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> Wages kept pace with inflation Yeah, well ... not so sure about this one. Most of the folks around me would also disagree, based on personal experience (the

> Wages kept pace with inflation Yeah, well ... not so sure about this one. Most of the folks around me would also disagree, based on personal experience (their purchasing power took a serious nosedive in the last 20 years or so). I'll grant you this is circumstantial, so I ask: source for the claim? [EDIT]: and there are folks who strongly disagree with you: https://dailyreckoning.com/revealing-real-rate-inflation-crash-system/ https://dailyreckoning.com/revealing-real-rate-inflation-cra... Also: >It says so right on the tin. I'd also disagree with this. Many folks I know who are essentially either clueless or simply uninterested in finance are entirely oblivious to the fact that they're being slowly but surely being bled dry via inflation. You can claim they should pay attention and if they don't too bad, but I'd retort that the system is being disingenuous, especially towards the lower strata of the economic system who are the less likely to understand these things.

arcticbull 6y ago
> Most of the folks around me would also disagree, based on personal experience (their purchasing power took a serious nosedive in the last 20 years or so). Anecdotes are not evidence - a lot has changed in 20 years. Your friends work may no longer be valued as highly by the market, or other social policies like not tying minimum wage to inflation, may have taken a toll. The BLS tracks this. [1] The fact they haven’t gone up more, however, is a social issue and not a monetary policy issue. > Many folks I know who are essentially either clueless or simply uninterested in finance are entirely oblivious to the fact that they're being slowly but surely being bled dry via inflation. You claim ... the fed isn’t telling people inflation is designed to track a 2% target? I’m sorry that folks are ignorant of how something so important works, but it does so for a reason. When I hop into a car and smash it against a wall, I don’t get to claim “many people are ignorant of how the accelerator works.” Tons of people go to prison for crimes they're ignorant of - that doesn't mean we shouldn't have laws. This is just an argument for high school home-ec and econ 101 to be mandatory. The lower strata is the least affected because as I’ve shown wages kept pace with inflation and they’re not saving so there’s nothing to inflate away except their debts. Between the record low interest and debts denominated in dollars of the year of issue, in aggregate they likely stand to gain. > ... and there are folks who strongly disagree with you: There are folks who disagree with the curvature of the earth, the efficacy of vaccinations and the existence of birds. The article you linked suggests based on a taco truck the rate of inflation is 30%, and has trivially sensationalized quotes like: Between 2010 and now, the Burrito Index has logged a 30% increase, more than *triple* the officially registered 10% drop in purchasing power over the same time. Well, without bothering to check anything about this claim, the article was written in 2016 so to obtain a 30% drop in the 7 years the inflation rate would be 2.5% (1.025**7). That's not triple, thats 25%, and the 2% target is a long-term rough goal. 2.5% is within that range. The man's burrito calculator doesn't take into account changes in taxes, in minimum wage, and other trivially recognizable things like how popular the burrito truck is. Zero inflation doesn't mean the price of a burrito will never change. Sheesh. [1] https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/ https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us...

arcticbull 6y ago

> Most of the folks around me would also disagree, based on personal experience (their purchasing power took a serious nosedive in the last 20 years or so). Anecdotes are not evidence - a lot has changed in 20 years. Your friends work may no longer be valued as highly by the market, or other social policies like not tying minimum wage to inflation, may have taken a toll. The BLS tracks this. [1] The fact they haven’t gone up more, however, is a social issue and not a monetary policy issue. > Many folks I know who are essentially either clueless or simply uninterested in finance are entirely oblivious to the fact that they're being slowly but surely being bled dry via inflation. You claim ... the fed isn’t telling people inflation is designed to track a 2% target? I’m sorry that folks are ignorant of how something so important works, but it does so for a reason. When I hop into a car and smash it against a wall, I don’t get to claim “many people are ignorant of how the accelerator works.” Tons of people go to prison for crimes they're ignorant of - that doesn't mean we shouldn't have laws. This is just an argument for high school home-ec and econ 101 to be mandatory. The lower strata is the least affected because as I’ve shown wages kept pace with inflation and they’re not saving so there’s nothing to inflate away except their debts. Between the record low interest and debts denominated in dollars of the year of issue, in aggregate they likely stand to gain. > ... and there are folks who strongly disagree with you: There are folks who disagree with the curvature of the earth, the efficacy of vaccinations and the existence of birds. The article you linked suggests based on a taco truck the rate of inflation is 30%, and has trivially sensationalized quotes like: Between 2010 and now, the Burrito Index has logged a 30% increase, more than *triple* the officially registered 10% drop in purchasing power over the same time. Well, without bothering to check anything about this claim, the article was written in 2016 so to obtain a 30% drop in the 7 years the inflation rate would be 2.5% (1.025**7). That's not triple, thats 25%, and the 2% target is a long-term rough goal. 2.5% is within that range. The man's burrito calculator doesn't take into account changes in taxes, in minimum wage, and other trivially recognizable things like how popular the burrito truck is. Zero inflation doesn't mean the price of a burrito will never change. Sheesh. [1] https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/ https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us...