From Bloomberg:
"The U.S. consumer price index continues to be a testament to the art of economic spin.Since wages, Social Security cost-of-living increases and some agency budgets are tied to it, the government has a vested interest in keeping it as low as possible.
Yet your real cost of living -- what you keep after taxes, medical bills, college expenses and other household costs -- is probably much higher than the 2 percent annual rate the government reported in July, showing a slight decline."
I am glad to see that someone other than economists are examining how much of a farce the CPI data is. With gas, groceries, health care, housing, tuition and just about ever other everyday purchase going up, its amazing to me that the US Government can continue to spout this incredulously low CPI number.
I guess since the only real things we buy are big screen TVs, computers and imported Chinese goods than everything is A-OK.
1 comment:
This reiterates two things: one, you have to understand the components of the number that you are being given (what it includes, but more importantly what it leaves out); two, the same statistic can be used by different people for different purposes.
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