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>How the fuck do we end up with a normalised rate of inflation of 6-7%? I don't know about Sweden, but the BLS publishes their data and methodology for the CPI

>How the fuck do we end up with a normalised rate of inflation of 6-7%? I don't know about Sweden, but the BLS publishes their data and methodology for the CPI calculation. You can quibble about details, that's fair, but it's transparent. It's based on a basket of goods and proportional spending on those goods in the basket. In some calculations food and fuel are excluded because of volatility (controversial, for obviously reasons). Like all averages, it's not going to accurate on any individual level.

piva00 4y ago
SCB (Statistiska centralbyrån) very likely does the same, like I mentioned in my comment I need to dig deeper and find the details because the numbers don't make sense for my friends and mine reality so there's something in the modelling that doesn't match the lives I have anecdotal experience with.
once_inc 4y ago
Being open about the methodology doesn't mean nobody is actively trying to game it. Replacing A-status products with B-status products, or removing controversial items from the basket and added different products that have favorable inflation effects is actively being done by most countries. Also; this basket doesn't look at things like shrinkflation, such as the size of a snickers bar, or the number of pyramids in a Toblerone bar.
- Y-bar 4y ago
  They appear to actually consider shrinkflation: > Tittar man på den totala kostnaden för livsmedel bidrar krympflationen som mest med en årlig prisförändring på tre tiondelars procent. > Looking at the total cost for groceries shrinkflation adds three tenths of a percentage to the yearly cost change. https://scb.se/hitta-statistik/redaktionellt/krympflationen-ger-dig-mindre-innehall-for-pengarna/ https://scb.se/hitta-statistik/redaktionellt/krympflationen-... And: > Det är cirka två procent av livsmedlen som ändrar förpackningsstorlek under ett år. Implicita prisförändringar, eller krympflation som vissa kallar det, förklarar cirka 10 procent av de prisuppgångar som sker för förpackade livsmedel. > It is about two percent of groceries that change packaging size every year. Implicit price changes, or shrinkflation as some call it, explains about ten percent of the price increase which happen on packaged groceries. https://scb.se/contentassets/419935bc1ce44b43ae97ee1d5dc6f349/nr0001_2020k02_ti_a28ti2005.pdf https://scb.se/contentassets/419935bc1ce44b43ae97ee1d5dc6f34...
em500 4y ago
> In some calculations food and fuel are excluded because of volatility (controversial, for obviously reasons). From the BLS FAQ[1]: Has the BLS removed food or energy prices in its official measure of inflation? No. The BLS publishes thousands of CPI indexes each month, including the headline All Items CPI for All Urban Consumers (CPI-U) and the CPI-U for All Items Less Food and Energy. The latter series, widely referred to as the "core" CPI, is closely watched by many economic analysts and policymakers under the belief that food and energy prices are volatile and are subject to price shocks that cannot be damped through monetary policy. However, all consumer goods and services, including food and energy, are represented in the headline CPI. Most importantly, none of the prominent legislated uses of the CPI excludes food and energy. Social security and federal retirement benefits are updated each year for inflation by the All Items CPI for Urban Wage Earners The FAQ clarifies a bunch of other CPI misconceptions overheard regularly in internet forums. [1] https://www.bls.gov/cpi/factsheets/common-misconceptions-about-cpi.htm#Question_1 https://www.bls.gov/cpi/factsheets/common-misconceptions-abo...

piva00 4y ago

SCB (Statistiska centralbyrån) very likely does the same, like I mentioned in my comment I need to dig deeper and find the details because the numbers don't make sense for my friends and mine reality so there's something in the modelling that doesn't match the lives I have anecdotal experience with.

once_inc 4y ago

Being open about the methodology doesn't mean nobody is actively trying to game it. Replacing A-status products with B-status products, or removing controversial items from the basket and added different products that have favorable inflation effects is actively being done by most countries. Also; this basket doesn't look at things like shrinkflation, such as the size of a snickers bar, or the number of pyramids in a Toblerone bar.

Y-bar 4y ago
They appear to actually consider shrinkflation: > Tittar man på den totala kostnaden för livsmedel bidrar krympflationen som mest med en årlig prisförändring på tre tiondelars procent. > Looking at the total cost for groceries shrinkflation adds three tenths of a percentage to the yearly cost change. https://scb.se/hitta-statistik/redaktionellt/krympflationen-ger-dig-mindre-innehall-for-pengarna/ https://scb.se/hitta-statistik/redaktionellt/krympflationen-... And: > Det är cirka två procent av livsmedlen som ändrar förpackningsstorlek under ett år. Implicita prisförändringar, eller krympflation som vissa kallar det, förklarar cirka 10 procent av de prisuppgångar som sker för förpackade livsmedel. > It is about two percent of groceries that change packaging size every year. Implicit price changes, or shrinkflation as some call it, explains about ten percent of the price increase which happen on packaged groceries. https://scb.se/contentassets/419935bc1ce44b43ae97ee1d5dc6f349/nr0001_2020k02_ti_a28ti2005.pdf https://scb.se/contentassets/419935bc1ce44b43ae97ee1d5dc6f34...

em500 4y ago

> In some calculations food and fuel are excluded because of volatility (controversial, for obviously reasons). From the BLS FAQ[1]: Has the BLS removed food or energy prices in its official measure of inflation? No. The BLS publishes thousands of CPI indexes each month, including the headline All Items CPI for All Urban Consumers (CPI-U) and the CPI-U for All Items Less Food and Energy. The latter series, widely referred to as the "core" CPI, is closely watched by many economic analysts and policymakers under the belief that food and energy prices are volatile and are subject to price shocks that cannot be damped through monetary policy. However, all consumer goods and services, including food and energy, are represented in the headline CPI. Most importantly, none of the prominent legislated uses of the CPI excludes food and energy. Social security and federal retirement benefits are updated each year for inflation by the All Items CPI for Urban Wage Earners The FAQ clarifies a bunch of other CPI misconceptions overheard regularly in internet forums. [1] https://www.bls.gov/cpi/factsheets/common-misconceptions-about-cpi.htm#Question_1 https://www.bls.gov/cpi/factsheets/common-misconceptions-abo...