3 ms·

For the most part people care, index, and budget based on their income. For most people that changes on an Annual Basis so looking at price flucuations from Ju

For the most part people care, index, and budget based on their income. For most people that changes on an Annual Basis so looking at price flucuations from July 2021 to July 2022 is a more accurate and proper way to look at inflation as it impacts the normal every day person, than looking at inflation variance from Aug 2022 to Sept 2022. I care that I was buying beef at $3 / lb last year, and now am paying $6/ lb today, not that I was buying beef at $6/lb last month and it is still $6/lb this month... I want my $3/lb beef back

conductr 4y ago
The MoM reporting for beef price inflation would be ~100% for several months after it hit $6/lb as it's rolling 12 months. That doesn't mean it's $12 in August, then $24 in September, etc. That's the impression laymen folks get based on the media reporting.
- Y_Y 4y ago
  "laymen" is already a noun like "laity" for which the corresponding adjective is just "lay"
  - conductr 4y ago
    Thanks for the clarification. I've never heard or seen the word "laity" but have become wary of using gendered words on the internet so added "folks" without much thought. Sign of the times I suppose, hard to please everyone.
    - UtopiaPunk 4y ago
      "Lay people" or "lay folks" would work. I only hear the word "laity" used in church (meaning the people who are not the clergy).
mech422 4y ago
Unless I'm mistaken...'most' people are still living pretty much paycheck to paycheck, and budgeting based on what they can afford at the moment. TBH though, I haven't looked lately. Anecdotally, no-one I know complains about beef being $3 last year...they are more concerned with it being $4/lb last MONTH and $6/lb now. Gas seems to be especially prone to this, people seem to budget gas on a more 'weekly' basis.
- JumpCrisscross 4y ago
  > no-one I know complains about beef being $3 last year...they are more concerned with it being $4/lb last MONTH and $6/lb now The point is this isn’t happening. CPI is up less than half a percent since June [1]. Core is more consistently rising [2]. But beef costs about what it did in March [3][4]. (We have to go back a decade to find ground beef at $3/lb.) [1] https://fred.stlouisfed.org/series/CPIAUCSL https://fred.stlouisfed.org/series/CPIAUCSL [2] https://fred.stlouisfed.org/series/CPILFESL https://fred.stlouisfed.org/series/CPILFESL [3] https://fred.stlouisfed.org/series/PBEEFUSDM https://fred.stlouisfed.org/series/PBEEFUSDM [4] https://fred.stlouisfed.org/series/APU0000703112 https://fred.stlouisfed.org/series/APU0000703112
  - mech422 4y ago
    I wasn't contesting that, just pointing out I don't think 'most' people budget annually. For that matter, most I know don't seem to remember last years prices good or bad. They are more worried about the present.
- phpisthebest 4y ago
  >and budgeting based on what they can afford at the moment That is not budgeting, that is choosing what products to buy based on your budget. One would set a budget of say $400 a month for groceries based on their income, this is would be fixed for the year. then when they go to the store, or make a shopping list that choose Chicken or Beef, Frozen or Fresh etc based on the current prices and what will fit into that budget. > Anecdotally, no-one I know complains about beef being $3 last year...they are more concerned with it being $4/lb last MONTH and $6/lb now Both are a concern, but only one deals with budgets. The $3 is important because that was the baseline for which the budget was set, choices on employment, hours, overtime, finding a new job, going back to school etc are based on this budgeting the Mo over Mo prices factor not into the budgeting, but into if you buy 1lb and some beans for your chili, or 2 pounds of beef and no beans so you can make "real chili":) .. Of if you buy a steak vs ground beef, or chick... Those are purchasing choices at the moments for the exact goods and services that will be consumed under your budget
jerlam 4y ago
There's also the concept of price anchoring, where people believe that something they purchased has the same price long enough, they start to think that it always should have the same price (regardless of everything else). And some people just love to complain about everything. During my childhood, my parents loved to comment about how gum/candy was a nickel when they grew up. They don't complain about the price of anything else going up, even though undoubtedly all the food prices have gone up in multiple decades. But they only bought candy at a short period in their life, and the price was the same from when they started and when they stopping buying candy, so they only have the "one true price" in memory. Everything else they have to purchase regularly so they're exposed to increasing prices. Just not candy.
jwarden 4y ago
I think the truthfulness of media reporting is best evaluated based not on literal factual accuracy, but on what it causes people to believe. Factual accuracy is not sufficient without other information needed to put those facts into context. Either the media doesn't adequately explain or the average person doesn't adequately understand the YoY numbers. Either way, media is responsible for causing the average person to believe something that is not true (that prices are going up faster each month than they actually are). It's true that YoY numbers can be more meaningful to the normal every day person, but only if they understand them. It might be better if people understood that prices, relative to a year ago, are not increasing in recent months at an 8.9% annualized rate.

conductr 4y ago

The MoM reporting for beef price inflation would be ~100% for several months after it hit $6/lb as it's rolling 12 months. That doesn't mean it's $12 in August, then $24 in September, etc. That's the impression laymen folks get based on the media reporting.

Y_Y 4y ago
"laymen" is already a noun like "laity" for which the corresponding adjective is just "lay"
- conductr 4y ago
  Thanks for the clarification. I've never heard or seen the word "laity" but have become wary of using gendered words on the internet so added "folks" without much thought. Sign of the times I suppose, hard to please everyone.
  - UtopiaPunk 4y ago
    "Lay people" or "lay folks" would work. I only hear the word "laity" used in church (meaning the people who are not the clergy).

mech422 4y ago

Unless I'm mistaken...'most' people are still living pretty much paycheck to paycheck, and budgeting based on what they can afford at the moment. TBH though, I haven't looked lately. Anecdotally, no-one I know complains about beef being $3 last year...they are more concerned with it being $4/lb last MONTH and $6/lb now. Gas seems to be especially prone to this, people seem to budget gas on a more 'weekly' basis.

JumpCrisscross 4y ago
> no-one I know complains about beef being $3 last year...they are more concerned with it being $4/lb last MONTH and $6/lb now The point is this isn’t happening. CPI is up less than half a percent since June [1]. Core is more consistently rising [2]. But beef costs about what it did in March [3][4]. (We have to go back a decade to find ground beef at $3/lb.) [1] https://fred.stlouisfed.org/series/CPIAUCSL https://fred.stlouisfed.org/series/CPIAUCSL [2] https://fred.stlouisfed.org/series/CPILFESL https://fred.stlouisfed.org/series/CPILFESL [3] https://fred.stlouisfed.org/series/PBEEFUSDM https://fred.stlouisfed.org/series/PBEEFUSDM [4] https://fred.stlouisfed.org/series/APU0000703112 https://fred.stlouisfed.org/series/APU0000703112
- mech422 4y ago
  I wasn't contesting that, just pointing out I don't think 'most' people budget annually. For that matter, most I know don't seem to remember last years prices good or bad. They are more worried about the present.
phpisthebest 4y ago
>and budgeting based on what they can afford at the moment That is not budgeting, that is choosing what products to buy based on your budget. One would set a budget of say $400 a month for groceries based on their income, this is would be fixed for the year. then when they go to the store, or make a shopping list that choose Chicken or Beef, Frozen or Fresh etc based on the current prices and what will fit into that budget. > Anecdotally, no-one I know complains about beef being $3 last year...they are more concerned with it being $4/lb last MONTH and $6/lb now Both are a concern, but only one deals with budgets. The $3 is important because that was the baseline for which the budget was set, choices on employment, hours, overtime, finding a new job, going back to school etc are based on this budgeting the Mo over Mo prices factor not into the budgeting, but into if you buy 1lb and some beans for your chili, or 2 pounds of beef and no beans so you can make "real chili":) .. Of if you buy a steak vs ground beef, or chick... Those are purchasing choices at the moments for the exact goods and services that will be consumed under your budget

jerlam 4y ago

There's also the concept of price anchoring, where people believe that something they purchased has the same price long enough, they start to think that it always should have the same price (regardless of everything else). And some people just love to complain about everything. During my childhood, my parents loved to comment about how gum/candy was a nickel when they grew up. They don't complain about the price of anything else going up, even though undoubtedly all the food prices have gone up in multiple decades. But they only bought candy at a short period in their life, and the price was the same from when they started and when they stopping buying candy, so they only have the "one true price" in memory. Everything else they have to purchase regularly so they're exposed to increasing prices. Just not candy.

jwarden 4y ago

I think the truthfulness of media reporting is best evaluated based not on literal factual accuracy, but on what it causes people to believe. Factual accuracy is not sufficient without other information needed to put those facts into context. Either the media doesn't adequately explain or the average person doesn't adequately understand the YoY numbers. Either way, media is responsible for causing the average person to believe something that is not true (that prices are going up faster each month than they actually are). It's true that YoY numbers can be more meaningful to the normal every day person, but only if they understand them. It might be better if people understood that prices, relative to a year ago, are not increasing in recent months at an 8.9% annualized rate.