Do any of y'all believe the governments inflation numbers? - Page 2 - TigerDroppings.com

Posted byMessage
TerryDawg03
Georgia Fan
The Deep South
Member since Dec 2012
1839 posts

re: Do any of y'all believe the governments inflation numbers?


quote:

if by "buy it" you mean "regard CPI (without energy/food prices) as a good indicator for informing monetary policy" you can count me as one.


Knowing how easily the CPI can be manipulated to justify whatever monetary policy (currency manipulation) the Fed sees fit, does this trouble you?






Back to top
TerryDawg03
Georgia Fan
The Deep South
Member since Dec 2012
1839 posts

re: Do any of y'all believe the governments inflation numbers?


quote:

Are you submitting that a price index composed of gas and milk is better?


Are you submitting that one that excludes them is valid?






Back to top
HortensePowdermaker
Grambling Fan
Member since Feb 2013
696 posts

re: Do any of y'all believe the governments inflation numbers?


I don't know about inflation per se but both food and energy as a percentage of household expenditures is down radically from 40 years ago.





Back to top
SpidermanTUba
LSU Fan
Member since May 2004
28760 posts

re: Do any of y'all believe the governments inflation numbers?


quote:

LINK


This utter nonsense has been thoroughly debunked.


quote:



The use of the geometric mean alone is stated to have lowered the CPI growth rate by 3 percentage points, and other BLS changes, such as the use of hedonic models and OER, supposedly have lowered the growth rate by an additional 4 percentage points.(57)


Each of these estimates of the impact of BLS changes is inconsistent with the empirical evidence.
As noted earlier, the BLS has computed indexes showing that the use of the geometric mean formula has reduced the growth rate of the geometric mean of the CPI by only -0.28 percentage point per year, not 3 percentage points.... (GO TO PAGE 14 COLUMN 2, KEEP READING)

...

(57) Visit the Web site www.shadowstats.com/alternate_data (visited Aug. 28, 2008)


LINK



This post was edited on 9/13 at 2:26 pm


Back to top
  Replies (0)
Wishnitwas1998
Tennessee Fan
Walls, Ms
Member since Oct 2010
15803 posts

re: Do any of y'all believe the governments inflation numbers?




quote:

Are you submitting that a price index composed of gas and milk is better?


Did I suggest that?
quote:

This is because most people but more than gas, milk, and pretty much all food.


So you admit that people buy milk, food, and gas yet it is not included in CPI because?






Back to top
90proofprofessional
LSU Fan
Member since Mar 2004
8932 posts
 Online 

re: Do any of y'all believe the governments inflation numbers?


quote:

Knowing how easily the CPI can be manipulated to justify whatever monetary policy (currency manipulation) the Fed sees fit, does this trouble you?

No, but maybe I don't know just how easy it is. How easily can it be manipulated? And why would they do this when the Fed's mandate is quite clear? Do you think the Fed has some insidious goal, that the BLS (who defines CPI) would be in on?






Back to top
TerryDawg03
Georgia Fan
The Deep South
Member since Dec 2012
1839 posts

re: Do any of y'all believe the governments inflation numbers?


quote:

I don't know about inflation per se but both food and energy as a percentage of household expenditures is down radically from 40 years ago.


Do you have a link? That'd be interesting to read.






Back to top
SpidermanTUba
LSU Fan
Member since May 2004
28760 posts

re: Do any of y'all believe the governments inflation numbers?


quote:



So you admit that people buy milk, food, and gas yet it is not included in CPI because?





Milk, food, and gas are in the CPI.

You're referring to "core" inflation, which may be computed by removing food and gas and other volatile items from the CPI. The number that the BLS reports is the entire CPI, which includes gas and milk.
quote:


Core inflation is most often calculated by taking the Consumer Price Index (CPI) and excluding certain items from the index, usually energy and food products.


LINK



This post was edited on 9/13 at 2:41 pm


Back to top
  Replies (0)
HortensePowdermaker
Grambling Fan
Member since Feb 2013
696 posts

re: Do any of y'all believe the governments inflation numbers?


quote:

Do you have a link? That'd be interesting to read.


I should amend my statement to say "from the mid-1970's:





So between home and car energy bills, it's way off the 70's highs - with gasoline obviously ticking back up in recent years.

LINK





Food is down 30%ish over the same time period. (Although I would argue that just looking at food ignores the "costs" of eating "cheap" like Americans eat - they have probably way more than given it up in needless healthcare expenditures to support their terrible eating habits, but that's for a different discussion I guess).

But anyway, you tell me: what has "food inflation" been over the past 40 years?



This post was edited on 9/13 at 3:10 pm


Back to top
SpidermanTUba
LSU Fan
Member since May 2004
28760 posts

re: Do any of y'all believe the governments inflation numbers?


quote:


No, but maybe I don't know just how easy it is. How easily can it be manipulated? And why would they do this when the Fed's mandate is quite clear? Do you think the Fed has some insidious goal, that the BLS (who defines CPI) would be in on?






People just think its an underestimate because of psychology. Your brain notices and remembers pain more than gain. When the price of milk goes up - you notice - when the price of the same milk goes back down - you don't notice as much. This would be why volatile items like milk and gas prices are always instinctively thought to have inflated more than they have - when gas goes down $1 you don't notice as much as when it goes up $1.






Back to top
Gmorgan4982
LSU Fan
Member since May 2005
99355 posts

re: Do any of y'all believe the governments inflation numbers?


Probably best not to believe government numbers on anything.





Back to top
  Replies (0)
LSUnation78
LSU Fan
Northshore
Member since Aug 2012
1451 posts
 Online 

re: Do any of y'all believe the governments inflation numbers?


Nope, not when all they have to do is modify the "basket of goods" CPI is based on. Its just like un-employment numbers, cooked.





Back to top
HortensePowdermaker
Grambling Fan
Member since Feb 2013
696 posts

re: Do any of y'all believe the governments inflation numbers?


quote:

Nope, not when all they have to do is modify the "basket of goods" CPI is based on. Its just like un-employment numbers, cooked.


How bad can inflation be when households are spending less on food and energy than in decades past? What about cheap stuff from China?

And hedonics DO matter. I don't even remember what I spent on my phone bill in 1971, but I can sure tell you I am very happy to be spending whatever the difference is to have a smartphone.






Back to top
  Replies (0)
LSUnation78
LSU Fan
Northshore
Member since Aug 2012
1451 posts
 Online 

re: Do any of y'all believe the governments inflation numbers?


All of that data is based on total expenditure. Not the same thing as the cost per unit. Remember, the types of foods and how they are prepared has changed drastically over the past 30 years. In today's world the average consumer does not buy as many parishable goods. Meaning there is less waste.





Back to top
HortensePowdermaker
Grambling Fan
Member since Feb 2013
696 posts

re: Do any of y'all believe the governments inflation numbers?


quote:

All of that data is based on total expenditure. Not the same thing as the cost per unit. Remember, the types of foods and how they are prepared has changed drastically over the past 30 years. In today's world the average consumer does not buy as many parishable goods. Meaning there is less waste.


I understand, but isn't it really the same effect? Who cares what the price is if it's a shrinking portion of my income?






Back to top
LSUnation78
LSU Fan
Northshore
Member since Aug 2012
1451 posts
 Online 

re: Do any of y'all believe the governments inflation numbers?


Well thats a capitalism at work, free choice. Consumers choose to spend less on food by substituting alternatives when available. Having artificially created foods as an "alternative" choice to the real thing consumers purchased 30 years ago is a pro and con, IMO. Processed goop to make "chicken nuggets" brings the price down.. but is that better for you than the real thing?





Back to top
HortensePowdermaker
Grambling Fan
Member since Feb 2013
696 posts

re: Do any of y'all believe the governments inflation numbers?


quote:

Well thats a capitalism at work, free choice.


Of course. But also cars have gotten energy efficient and better in myriad ways.

quote:

Having artificially created foods as an "alternative" choice to the real thing consumers purchased 30 years ago is a pro and con, IMO. Processed goop to make "chicken nuggets" brings the price down.. but is that better for you than the real thing?


I brought up the same issue a few posts back.






Back to top
LSUnation78
LSU Fan
Northshore
Member since Aug 2012
1451 posts
 Online 

re: Do any of y'all believe the governments inflation numbers?


quote:

But also cars have gotten energy efficient and better in myriad ways.


Completely agree. Thats why I am trying to talk about food the most because its really the only item that can be somewhat compared on an apples to apples basis, but they dont do that anymore in the CPI.

Let me ask you this, what do you think the exact purpose of the CPI index is? If its to track consumer spending habits, then it works great. If it is to accurately reflect the increase in costs for basic necessities, replacing OJ with Tang in the basket of goods doesn't really show the whole truth. Thats all I meant by my original statement.






Back to top
Tigah in the ATL
LSU Fan
Atlanta
Member since Feb 2005
24808 posts

re: Do any of y'all believe the governments inflation numbers?


What is it you think is so much more expensive?





Back to top
TerryDawg03
Georgia Fan
The Deep South
Member since Dec 2012
1839 posts

re: Do any of y'all believe the governments inflation numbers?


quote:

What is it you think is so much more expensive?


Gasoline, for one






Back to top
  Replies (0)


Back to top