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By the 1980 CPI, inflation is running at closer to 9% right now. So yes, I'm saying inflation has been chugging at a brutal pace the past 12 years. When the CPI
by shingen 15y ago
By the 1980 CPI, inflation is running at closer to 9% right now. So yes, I'm saying inflation has been chugging at a brutal pace the past 12 years. When the CPI was that high back then, Volcker had to take extreme measures to tame inflation. When inflation was 3% to 4% in 1970/1971, Nixon installed price and wage controls. Now when it's much higher on our new CPI, we don't even bat an eyelash at the extreme inflation.
You might think, for example, that real estate has gotten cheap? It's up 100% over the last 12 years in real estate disaster zones like Phoenix. How many people have seen their wages climb 100% in the last 12 years? That's pure inflation, as the historical rate of return on real estate is closer to 1% to 2% per year.
You can also blatantly track the huge inflation of the last 12 years in most commodities.
The current Fed CPI, which was altered during the early Clinton years to hide real inflation, says that inflation is around 3%x. It leaves out all sorts of fun inflationary items (because the Fed says they're volatile, har har).
- Aloisius 15y agoWhat kind of fun inflationary items? And please don't say gold or oil as it would be an extreme case of cherry picking commodities.
- shingen 15y agoThe Fed CPI excludes food and energy. So when milk goes from $1.50 to $3.60 per gallon over 20 years, they pretend that never happened. Or when gasoline goes from $0.75 to $3.59 over 30 years, they pretend that never happened. They pretend you don't need to eat food or drive anywhere.
- Aloisius 15y agoUh, the Fed CPI does include food and energy prices. The government does have a separate "core" inflation number which excludes food and energy prices, but the regular CPI number includes food and energy and has forever. Specifically, the CPI-U includes food & energy, but economic analysts and policymakers like to use the CPI-U for All Items Less Food and Energy because of the volatility of commodities. The CPI-U however is still available and was last sitting at 3% for 2011. Again, that's with food & energy. http://www.bls.gov/news.release/cpi.nr0.htm http://www.bls.gov/news.release/cpi.nr0.htm Not only that, but the numbers that exclude food and energy make inflation look higher than when they are included.