4 ms·

It hasn't? Check the price of milk. Check the price of beef. Compare the price per ounce of packaged food in 2008 vs. today. Compare the price of anything t

It hasn't? Check the price of milk. Check the price of beef. Compare the price per ounce of packaged food in 2008 vs. today. Compare the price of anything that isn't included in the "official" numbers for inflation and you see a much different story about inflation. Put another way, it used to be a mystery: "Why do hotdogs come in packages of 10 and buns in packages of 8?" now you should be asking "Why do hotdogs come in packages of 8 and I still pay the same amount as 10?"

dllthomas 13y ago
http://www.fao.org/worldfoodsituation/foodpricesindex/en/?_=1393604860591 http://www.fao.org/worldfoodsituation/foodpricesindex/en/?_=... Your claims do not reflect my personal experience, and do not seem to be very well substantiated.
rayiner 13y ago
Thats a bad argument, because food products are heavily dependent on the price of fuel, and that has gone up because of: geopolitical instability, limited supply, and explosive demand in developing countries. QE didn't cause increasing demand for oil in China. The price of food and fuel would have gone up relative to other things regardless. Inflation from an increase in money supply will manifest in a way that cuts across industry sectors. Cars, computers, and personal services would be getting more expensive. They're not. Look at the price of BMW's U.S. entry level 3 series. In 2004 it was $28k MSRP. BLS estimate for 2014 using official inflation is $35k MSRP. Actual is $38k MSRP (under 2.5 percent) for what is for various reasons a lot more car (50 more horsepower, bigger, safer, more fuel efficient). If it weren't for tighter emissions requirements since 2004, inflation in the price of cars would probably be below the general inflation rate.
- dllthomas 13y ago
  Or at least computers would be getting cheaper more slowly...
lotsofmangos 13y ago
Look, the thing is that if you massively increased the money supply as a percentage of the overall money in circulation, without any corresponding rise in productivity and population, then sure, you are going to have a bad day. However, this does not mean that any increase in the money supply will have negative consequences. For instance, if you do not increase the money supply at all and the output and population increase, then you have major problems as well. In this case we are talking about levels that are easily absorbed by the economy, which is not equivalent to an economy that uses silver for coinage finding more silver than they have in circulation.

dllthomas 13y ago

http://www.fao.org/worldfoodsituation/foodpricesindex/en/?_=1393604860591 http://www.fao.org/worldfoodsituation/foodpricesindex/en/?_=... Your claims do not reflect my personal experience, and do not seem to be very well substantiated.

rayiner 13y ago

Thats a bad argument, because food products are heavily dependent on the price of fuel, and that has gone up because of: geopolitical instability, limited supply, and explosive demand in developing countries. QE didn't cause increasing demand for oil in China. The price of food and fuel would have gone up relative to other things regardless. Inflation from an increase in money supply will manifest in a way that cuts across industry sectors. Cars, computers, and personal services would be getting more expensive. They're not. Look at the price of BMW's U.S. entry level 3 series. In 2004 it was $28k MSRP. BLS estimate for 2014 using official inflation is $35k MSRP. Actual is $38k MSRP (under 2.5 percent) for what is for various reasons a lot more car (50 more horsepower, bigger, safer, more fuel efficient). If it weren't for tighter emissions requirements since 2004, inflation in the price of cars would probably be below the general inflation rate.

dllthomas 13y ago
Or at least computers would be getting cheaper more slowly...

lotsofmangos 13y ago

Look, the thing is that if you massively increased the money supply as a percentage of the overall money in circulation, without any corresponding rise in productivity and population, then sure, you are going to have a bad day. However, this does not mean that any increase in the money supply will have negative consequences. For instance, if you do not increase the money supply at all and the output and population increase, then you have major problems as well. In this case we are talking about levels that are easily absorbed by the economy, which is not equivalent to an economy that uses silver for coinage finding more silver than they have in circulation.