Skip to comments.Why Reported Inflation Seems Different Than Reality
Posted on 12/23/2012 10:30:36 AM PST by arthurus
But the manipulation of the data did not stop there. Aside from the weighting changes the BLS instituted a system of hedonic adjustments. Hedonics adjusts the prices of goods for the increased pleasure the consumer derives from them.
That new washing machine you bought did not cost you 20% more than it would have cost you last year, because you got an offsetting 20% increase in the pleasure you derive from pushing its new electronic control buttons instead of turning that old noisy dial, according to the BLS.
When gasoline rises 10 cents per gallon because of a federally mandated gasoline additive, the increased gasoline cost does not contribute to inflation. Instead, the 10 cents is eliminated from the CPI because of the offsetting hedonic thrills the consumer gets from breathing cleaner air. The same principle applies to federally mandated safety features in automobiles. I have not attempted to quantify the effects of questionable quality adjustments to the CPI, but they are substantial.
(Excerpt) Read more at zerohedge.com ...
Is this satire? I can’t tell anymore.
When the GDP is adjusted for actual inflation, it is negative.
The unions have already begun the push for higher wages.
They will get them and then the inflation will be to big to ignore. The wage rise in the face of unemployment will spread to the whole economy
The same reason that reported unemployment seems different than reality?
Oh no. This is the Nobel Prize for Nothing Emperor for Life.
In the same way, our masters lie to us and tell us there "is no inflation!" And our obese, entitlement check collecting immoral masses nod their low information voting noggins, and surf for porn.
what kind of hedonic improvement can be done for Big Ears? i am so overjoyed at the idea of having to put up with 4 more years of lord haw haw.
This is an excellent article, but it can be boiled down, a lot, to: Your government lies to you - constantly.
They’ve been lying out their @sses, hiding, covering up, finagling, adjusting, manipulating, massaging, and doing whatever it takes to keep the lid on the country/economy until the election was over. Well, the election is over and all the mess they repressed is about to blow sky high. Personally, I’d rather have a calm, competent, Conservative (not talking Mitt here) who understands the economy and that big government has to be majorly downsized and spending must stop; however, we are stuck with Emperor Barry “I have no clothes” & Michelle “Antoinette Let Them Eat Vegetables” Obama at the helm and when all hell breaks loose and the country comes down around their ears, it couldn’t happen to a more deserving ‘couple’ of anti-American, anti-Christian, baby killing, pervert-loving,Constitution trampling, lawless Communists/Marxist/Muslims or whatever the heck they are.
Hopefully, there will be an American Phoenix to rise out of the ashes and the country will come back in some form other than a third world dictatorship, but ... that remains to be seen.
The Ministry of Truth is alive and well in Washedup, DC
Taking America out of the heart of Americans is a task too difficult even for Big Ears.
Got a new washing machine a few months ago - lots of gee whiz stuff - but truth be told the ‘pleasure’ of pushing new buttons faded quickly...
This is just a fancy of saying, "the need to fool the voter with smoke and mirrors"
My trips to the grocery store show a lot higher inflation than 1.7%. I think the gub’mint changed the rules on how they report inflation just like they did for unemployment.
Technological advances are also poorly accounted for. I can buy a more computer power now for a few hundred dollars now than I could have bought for a billion dollars a few decades ago. Intel and others have managed to print silicon faster than the government prints money, a remarkable fact in itself.
A new car costs X% more than it did ten years ago, and that price increase can be substantial. The reality, though, is that the new car you buy today is not the same as the new car you bought ten years ago. It's a much better car, which means a one-to-one comparison would not be an accurate measure of inflation.
The same holds true for almost any product or service that involves technology that has advanced considerably over time. Medical care is another good example. Your medical insurance plan costs a lot more than it did 20 years ago, but it also covers many medical treatments that didn't even exist 20 years ago.
Obama’s Ministry of Truth. Reality is what they tell you it is.
Now shut up and pay your taxes, you degenerate capitalist pig.
Right, and tuition is up because the quality of education has improved so dramatically. Same with milk, eggs, bacon... they now must come with magic marshmallow yellow moon, red hearts and green clovers.
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