The Next Bubble

[bart]

Re: The Next Bubble

...
any other ideas for number manipulations in our future?
...

The BLS has been working on something called CPI-C.
Check out page 34 at http://www.bls.gov/ore/pdf/st050290.pdf to see some "interesting" differences between it and CPI-U.

[jk]

Re: The Next Bubble

The BLS has been working on something called CPI-C.
Check out page 34 at http://www.bls.gov/ore/pdf/st050290.pdf to see some "interesting" differences between it and CPI-U.

i saw the numerical differences between the indices at your link, bart, and then i tracked down this link:
http://www.cbpp.org/5-18-04bud.htm
which made clear to me what the cpi-c is about: the use of "the substitution effect" in calculating cpi, and the use of this "superlative" index [that's really what it's called!] to allow the government to screw social security recipients and anyone else with benefits keyed to inflation.

i forgot to mention "substitution" in my rant, above, about these numbers. you know: steak is too expensive so you buy chicken, chicken is too expensive so you buy cat food. the index really does need to incorporate the fact that you have indeed lowered your cost of living by switching to cat food, so inflation is not so bad as long as the next bubble isn't in cat food.

[bart]

Re: The Next Bubble

i saw the numerical differences between the indices at your link, bart, and then i tracked down this link:
http://www.cbpp.org/5-18-04bud.htm
which made clear to me what the cpi-c is about: the use of "the substitution effect" in calculating cpi, and the use of this "superlative" index [that's really what it's called!] to allow the government to screw social security recipients and anyone else with benefits keyed to inflation.

i forgot to mention "substitution" in my rant, above, about these numbers. you know: steak is too expensive so you buy chicken, chicken is too expensive so you buy cat food. the index really does need to incorporate the fact that you have indeed lowered your cost of living by switching to cat food, so inflation is not so bad as long as the next bubble isn't in cat food.

Thank you for explaining it in other than four letter words.

I just couldn't bring myself to keep my temper when describing the various heinous Orwellian methods that the BLS uses and proposes using to "calculate" the CPI.

I suspect and have heard rumors that there will be some "substitutions" done with energy prices in the future since they currently do not have any "adjustment" factors for mass transit or walking or bicycling or the likely return of the 55mph speed limit, etc.