Okay, let's talk about this. Inflation is a measure of how the economy is doing. There is an actual economic definition, but generally, it's an indicator of how your pocketbook feels from year to year. High inflation numbers are bad, and negative inflation numbers are bad. Generally, we want inflation to hover around 1%.
Yes, we have had negative inflation numbers. The Great Depression of the 1930s, We do not ever want to go through that again. There is a pretty good list here. It is important to remember that the US inflation rate is a US government statistic that shows the difference in price from a standard cart of goods and services. Many things are not measured in the "standard cart" and many economists argue that the "standard cart" is not truly reflective of what the consumer is actually feeling. Currently, the US Inflation rate is pegged at 3.14%..
Because I keep records, I know what I paid for a gallon of gasoline the day Joe Biden took office. It was $1.87 for a gallon of unleaded gas. I'm still paying $250 or better. I know that everything is higher now than it was when Joe took office. Eggs, milk, bread. It's not that I distrust the governments numbers, it is that I use another cart.
I am old enough to remember when Jimmy Carter was president, and I'm old enough to recall the Great Malaise. My fist home mortgage was over 10%. I know that two things killed Carter's reelection changes. High prices and foreign affairs. I can draw some parallels between what we were feeling then and what we are feeling now.
4 comments:
The thing that was different in the 1980 election was that the left wasn't totally running a completely fraudulent election. There will be no other candidate with any chance of winning a national election other than who the Democrats end up running.
One could argue that inflation is at least in part about the relative value of money. More money chasing the same amount of goods and services means that eventually prices will go up.
More money in circulation can happen like you said because the economy is doing well (think oil booms). It can also happen because. corrupt politicians give their corporate backers huge bail out’s (what we are feeling now). Or if the something like changing the cost of energy (think late 70’s) hurts the economy.
The people who keep book on the statistics openly admit that they pull some pretty shady substitutions. For instance, they freely admit that they make "Hedonistic adjustments".
The simplest example is meat. If the original market-basket held 5 pounds of T-bones and the price of beef goes up, they rationalize that housewives will buy Rump-roasts instead. When it keeps going up, they say she will switch to pork-chops. Then to chicken breasts. Then to chicken thighs. Then to hot-dogs. Then to pork-and-beans. Then to beans. Then to beans-and-rice. Then to rice. Then to corn-grits.
And, without batting an eye, they will claim that prices did not go up because the overall cost of the "market basket" did not change all that much.
They don't follow a method and give us a clinical answer. They decide what answer best serves their agenda and fiddle with the method until it delivers that answer.
3% inflation my aching anatomy!
I don't trust their numbers because as mentioned above, they routinely change what is included in their calculations.
Jonathan
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