I wonder if there could be liberal moles in the government office that computes the CPI, waiting to unleash a sudden rise in inflation, at an opportune time to trash the economy, and thereby influence a Presidential election?
BLS accurately reports imperfect CPI.
CPI under-reports consumer non-durable price inflation - the stuff we buy every day
There are 77 million "baby-boomers" - the group that inflates everything it touches
There are 70 MILLION people under age 16 in this country - the second wave baby boom; late childbearing by early boomers; normal childbearing by middle boomers; early childbearing by late boomers; plus the 90's immigration wave.
The inflation we are experienceing now is represented, but not properly measured by CPI (underweighted), in grocery store and garment prices.
Go to Kroger and check out my thesis
Suffice it to say that just examining the chart for the 90s shows no clear relation between the real rate and the price of gold. If a regression analysis were done R squared would not be impressive.
As to his puzzle about money growth and inflation rates even ancient monetary theory tells one that the velocity of circulation of money, V, is a principal component of prices. V has dropped rapidly since 9/11 because of uncertainty and people and business cutting back on spending, investing. While "fiat money" is a common term it is not an accurate or especially meaningful one. When people have decided that money is of no value no "fiat" will make it so. The value had gone from the Continental currency by 1785, the Condederate by 1864 and the German by 1922. Fiat or no fiat.
But I wouldn't expect fans of the purdy metal to get into all that complexity or give up a term supporting their ideology.