4 ms·

> Real wages, real per capita GDP, real median income et. al. are all higher now than before covid. You literally said nothing about cost of living here?

ajross 3y ago
I literally did? That's what "real" means: having more real wages means you can buy more stuff. It's already adjusted for price rises. Check out FRED if you don't believe me: https://fred.stlouisfed.org/series/LES1252881600Q https://fred.stlouisfed.org/series/LES1252881600Q https://fred.stlouisfed.org/series/A939RX0Q048SBEA https://fred.stlouisfed.org/series/A939RX0Q048SBEA https://fred.stlouisfed.org/series/MEHOINUSA672N https://fred.stlouisfed.org/series/MEHOINUSA672N You and the upthread commenter are just citing a meme. It is not true. Period.
- elashri 3y ago
  Real here means only that these numbers are adjusted for inflation. It does not change the fact that they are a poor measure for cost of living.
  - TremendousJudge 3y ago
    I don't agree with GP's original point (also afaik US minimum wage hasn't increased), but the way inflation is measured is with a basket of common goods that serve as proxy for "cost of living". If cost of living, the number in dollars, went up, it means prices rose, which means there was inflation. Maybe it wasn't measured "correctly" (the basket of goods isn't reflective of what people actually need to live), but in principle an increase in your "real" salary means you're better off and beating the rising cost of living
    - ghaff 3y ago
      The problem with looking at streaming service pricing in the context of inflation is that a lot of people have also dropped their cable TV subscriptions. I probably subscribe to too many streaming services but I'm still paying half of what I was paying for just cable TV alone.
- quadrifoliate 3y ago
  Your first graph for Median usual weekly real earnings shows a fall from 393 in Q2 2020 to 365 in Q2 2023. Your third graph for Real Median Household Income shows a fall from 76,660 in 2020 to 74,580 today. Even though I find it hard to take the reported inflation numbers seriously because they aren't calculated off a fixed basket of goods any more [1], those graphs don't seem to say we have more "real" wages now compared to 2020. I am confused as to why you seem to be arguing for the opposite. Am I reading them wrong or something? ---------------------------------------- [1] From https://www.investopedia.com/articles/07/consumerpriceindex.asp https://www.investopedia.com/articles/07/consumerpriceindex.... — "The new methodology takes into account changes in the quality of goods and the effects of substitution. Substitution, the changes consumers make in response to price increases, also changes the relative weighting of the goods in the basket. The overall result tends to be a lower CPI."
  - ajross 3y ago
    You're cherry picking the peak (literally the peak) of the covid relief though! People got huge checks in the first half of 2020, do you not remember? Why would you do that? You can see it's an outlier, growing rapidly then shrinking. Look at Q4 2019 to get pre-covid numbers and you'll see (1) there's a clear trend across the disruption and (2) it's clearly going up.
    - quadrifoliate 3y ago
      Okay, but then Real Median Income still goes down from 78,250 in 2019 to 74,580. You probably shouldn't go too far before Covid. People aren't going to think back to how things were ~5 years before Covid, they are going back to a couple years before.

ajross 3y ago

I literally did? That's what "real" means: having more real wages means you can buy more stuff. It's already adjusted for price rises. Check out FRED if you don't believe me: https://fred.stlouisfed.org/series/LES1252881600Q https://fred.stlouisfed.org/series/LES1252881600Q https://fred.stlouisfed.org/series/A939RX0Q048SBEA https://fred.stlouisfed.org/series/A939RX0Q048SBEA https://fred.stlouisfed.org/series/MEHOINUSA672N https://fred.stlouisfed.org/series/MEHOINUSA672N You and the upthread commenter are just citing a meme. It is not true. Period.

elashri 3y ago
Real here means only that these numbers are adjusted for inflation. It does not change the fact that they are a poor measure for cost of living.
- TremendousJudge 3y ago
  I don't agree with GP's original point (also afaik US minimum wage hasn't increased), but the way inflation is measured is with a basket of common goods that serve as proxy for "cost of living". If cost of living, the number in dollars, went up, it means prices rose, which means there was inflation. Maybe it wasn't measured "correctly" (the basket of goods isn't reflective of what people actually need to live), but in principle an increase in your "real" salary means you're better off and beating the rising cost of living
  - ghaff 3y ago
    The problem with looking at streaming service pricing in the context of inflation is that a lot of people have also dropped their cable TV subscriptions. I probably subscribe to too many streaming services but I'm still paying half of what I was paying for just cable TV alone.
quadrifoliate 3y ago
Your first graph for Median usual weekly real earnings shows a fall from 393 in Q2 2020 to 365 in Q2 2023. Your third graph for Real Median Household Income shows a fall from 76,660 in 2020 to 74,580 today. Even though I find it hard to take the reported inflation numbers seriously because they aren't calculated off a fixed basket of goods any more [1], those graphs don't seem to say we have more "real" wages now compared to 2020. I am confused as to why you seem to be arguing for the opposite. Am I reading them wrong or something? ---------------------------------------- [1] From https://www.investopedia.com/articles/07/consumerpriceindex.asp https://www.investopedia.com/articles/07/consumerpriceindex.... — "The new methodology takes into account changes in the quality of goods and the effects of substitution. Substitution, the changes consumers make in response to price increases, also changes the relative weighting of the goods in the basket. The overall result tends to be a lower CPI."
- ajross 3y ago
  You're cherry picking the peak (literally the peak) of the covid relief though! People got huge checks in the first half of 2020, do you not remember? Why would you do that? You can see it's an outlier, growing rapidly then shrinking. Look at Q4 2019 to get pre-covid numbers and you'll see (1) there's a clear trend across the disruption and (2) it's clearly going up.
  - quadrifoliate 3y ago
    Okay, but then Real Median Income still goes down from 78,250 in 2019 to 74,580. You probably shouldn't go too far before Covid. People aren't going to think back to how things were ~5 years before Covid, they are going back to a couple years before.