Do you believe the government's claim that price inflation is around 2% per year?

Pasta speculators?

Jamin, the Fed considers < 2% as bad for the economy.

Why would POTUS and his Marxist/Islamist conspirators want the economy to look bad?

jjjjj wrote:

Overall inflation cannot be gamed in this country.

could you be any more clueless? the government controls what goes in, what goes out and the weighting of everything in the basket. this has to be one of the easiest numbers to game out there (actually, game isn't the right word. more like rig). it's amazing how out to lunch people are on here.

also, you can't be serious if you think that the cost of pasta has any meaningful impact on most people. is that an extra $50/year you are paying in pasta? meanwhile anyone making any real amount of money is paying 1000s (or 10s of thousands or 100s of thousands or millions) more in taxes and health care premiums. then there are all the big ticket items that have skyrocketed (eg, tuition/room/board, rent, home prices, auto prices and taxes. even something as common as a subway fare has gone up nearly 100% since 2003:

but, sure, there's no inflation going on out there because it's impossible for the government to rig it.

Damn You Obama! wrote:

the threat of deflation would send the markets in to a tailspin.

Deflation .. Scary! I can't imagine how bad it would be to live in a world where prices were falling.

jamin wrote:

Damn You Obama! wrote:

the threat of deflation would send the markets in to a tailspin.

Deflation .. Scary! I can't imagine how bad it would be to live in a world where prices were falling.

It can get pretty bad

Big Dog Investments wrote:

I'm pretty sure it's less than 2%. In fact I believe a recent 12-month period was actually slightly deflationary. Have oil and gas prices not decreased where you live, jamin? This has a huge effect on consumer prices.

You're wrong. OIl and gas prices have an effect on meat and produce prices yet both are higher than anytime in the past.

The driving force behind consumer prices is the strong dollar, which makes imported goods, aka the bulk of our consumer goods, cheaper.

No. But in defense of the government, its not a claim. If you cherry pick the data enough than you will come up with a metric that supports a low inflation rate. But the fact is, if you measure inflation as it was measured in the 1970s, we would show a high single digit inflation rate much like we had through much of the 70s. http://www.shadowstats.com/alternate_data/inflation-charts

jamin wrote:

The government says that American consumer prices in U.S. dollars are rising at a steady rate of 2% per year, but if you ask any consumer he'll say that he sees prices going up (or quality going down) at a much faster rate and is having trouble keeping up with the increased cost of living. Who's right and who's wrong?

Good post.

I believe the real unemployment rate is approaching 30% and inflation is eerily reminiscent of the Carter administration, currently hovering around 19-20%.

Dig Dug Investments wrote:

Big Dog Investments wrote:

I'm pretty sure it's less than 2%. In fact I believe a recent 12-month period was actually slightly deflationary. Have oil and gas prices not decreased where you live, jamin? This has a huge effect on consumer prices.

You're wrong. OIl and gas prices have an effect on meat and produce prices yet both are higher than anytime in the past.

The driving force behind consumer prices is the strong dollar, which makes imported goods, aka the bulk of our consumer goods, cheaper.

There's little doubt that the strong dollar has been influential. But you make the same mistake that jamin makes when you focus only on meat and produce prices. If you consider a basket full of typical consumer goods, the picture is not so bad. For example, the CPIs for the first three months of 2015 were each lower than those from the corresponding months from 2014.

How much these prices have been affected, if at all, by lower oil prices is debatable. But there's little doubt that inflation currently is negligible and possibly nonexistent.

Big Dog Investments wrote:

There's little doubt that the strong dollar has been influential. But you make the same mistake that jamin makes when you focus only on meat and produce prices. If you consider a basket full of typical consumer goods, the picture is not so bad. For example, the CPIs for the first three months of 2015 were each lower than those from the corresponding months from 2014.

I think you're missing our point, which is that the change in the CPI does not accurately reflect the change in the cost of living (in U.S. dollars).

I'm a libtard wrote:

jamin wrote:

The government says that American consumer prices in U.S. dollars are rising at a steady rate of 2% per year, but if you ask any consumer he'll say that he sees prices going up (or quality going down) at a much faster rate and is having trouble keeping up with the increased cost of living. Who's right and who's wrong?

Unless you are a conspiracy theorist, why wouldn't you believe it?

To me, it's just like climate change. In climate change, you can't look at specific instances to justify or not justify it. You have to look at it as a whole.

The same thing applies to the economy. Individual observations by themselves are irrelevant.

I agree that bringing global warming into the discussion is relevant since the government began fudging the inflation data when it didn't fit. It used to be that if the cost of Oscar Meyer hotdogs increased from $4 to $4.40 this was recorded as a 10% price increase. What's done now though is they say, "yeah, those may have increased but you can find 'Nothing But Lips and Hoofs' dogs for $3.60 so we'll record the cost of hotdogs as having decreased by 10%". It's just like global warming in that regards. And you now need to attack Oscar Meyer eaters as being a bunch of whining idiots who don't know anything about the cost of goods.

Threads like this always amaze me. All these people with conflicting assertions that the "real" inflation rate is 20% or negative or whatever, based on... their gut feeling and personal observations? The U.S. is a very big country, with many millions of people and huge regional variations. Trying to extrapolate the national inflation rate from your personal experience (and whatever blogs you read) is like trying to assess the global climate by sticking your head out the window. Oh wait...

jamin wrote:

I think you're missing our point, which is that the change in the CPI does not accurately reflect the change in the cost of living (in U.S. dollars).

And I think you're missing my point that you are focusing only on items whose prices have increased and ignoring those that have decreased. You're not looking at the complete picture.

The CPI measures consumer costs of a variety of everyday items, not just those getting more expensive. If you want to believe those numbers have been tweaked, that's your prerogative. I've seen no evidence that leads me not to trust them.

Dig Dug Investments wrote:

You're wrong. OIl and gas prices have an effect on meat and produce prices yet both are higher than anytime in the past.

The main factor behind the increase in meat and produce prices has been the SW drought.

Randy Oldman wrote:

Dig Dug Investments wrote:

You're wrong. OIl and gas prices have an effect on meat and produce prices yet both are higher than anytime in the past.

The main factor behind the increase in meat and produce prices has been the SW drought.

I thought it was pasta speculators.

Big Dog Investments wrote:

And I think you're missing my point that you are focusing only on items whose prices have increased and ignoring those that have decreased. You're not looking at the complete picture.

I acknowledge that many consumer products, such as flat-panel TVs, have gone down dramatically in price. That doesn't cancel out college tuitions increasing tenfold since the 1970s, rent prices skyrocketing, etc. If your rent gets increased from $800 to $1200, that's $4800 more per year that you need to spend without getting any additional value in return. I know you could say that you technically don't need to rent a place, but try getting a job if you tell the hiring manager that you live in a cardboard box. Buying a flat-panel TV, or any TV, is choosing to spend money on a luxury. Meanwhile, a number of additional costly "needs" have entered the living equation: cell phone (Try getting a job if you tell the manager you don't have a cell phone), college education, mandatory health insurance, more roads and bridges being tolled, etc.

Whose rent goes from $800 to $1200?

Oh and cell phone costs are decreasing.

Say wha? wrote:

Whose rent goes from $800 to $1200?

Oh and cell phone costs are decreasing.

Cell phone costs are not decreasing but thanks for trying to play:

Are you kidding that you don't know people who have had massive rent increases? A $400 bump is a drop in the bucket in NYC.

Thanks for the truly enlightening post.