Peter Schiff: Consumer Inflation?

[don]

old news on the 'tulip . ..

[Polish_Silver]

The Truth is out there! NBER vs CPI

X-files fans were frequently reminded where the truth was,
but the good looking FBI agents never seemed to find it.

Schiff was clever to use magazines, which have the price printed right on them.
In the old days, paperback books also had the price printed right on the cover--they didn't anticipate much inflation during the time it would take to sell the book. It's amazing the CPI inflation would differ so much from Schiff's 10 magazines.

I found a good publication analyzing medical costs in the CPI, written by NBER ("national bureau of economic research").
http://www.nber.org/chapters/c7630.pdf
"Medical care in the consumer price Index" by Ina Kay Ford and Daniel H. Ginsburg.

The medical care CPI does not measure the whole cost of medical care to the nation, or individuals. It only measures the "out of pocket expenses".

These are:
co-pays for medical services, drugs, dentistry, eyeglasses
employee portion of the medical insurance.
insurance payments to medicare

It does not count:

employer contribution to the health insurance
costs of treating patients who do not pay
medicare, medicaid

How much difference does this make?

The CPI-U has medical care as 7.4% of expenditures.

A more general accounting, (PCE) has medical care as 17.9% of expenditures!

So the CPI under reports medical costs by 2.43X (~ 243%).

see pages 204-296

Two comments:

1) In Hong Kong, all the medical cost is about 5% of GDP, and they have the second best public health in the world. They also have an annual political battle over what to do with the budget surplus they get almost every year!

2) The under reporting of inflation keeps the dollar strong and UST rates low. This was discussed in Kevin Phillips book "Bad Money".

So if you say "the government is honest" you are ignoring the fact that the important truth is buried under a mountain of misleading details. Same with the so called "budget surplus" of 1999-2000. They were including social security taxes along with the other revenues to get the "surplus". So called "unified budget". But social security revenue is supposed to be dedicated to the retirement system, which is badly in the hole in the long run. In more honest accounting, there was no surplus in 1999-2000, and in fact the federal debt got larger each and every year Clinton was president. (see "debt to the penny" , from the US treasury department)

[davidstvz]

Re: Peter Schiff: Consumer Inflation?

Schiff was clever to use magazines, but not necessarily honest. What effect has the Internet had on the price of magazines since 1998? My guess is that it has reduced circulation a good bit, hence reduced ad revenue so the magazine printers need to find ways to replace that revenue. Raising the cover price works on two levels. It gets more money out of the people who buy a random magazine or two (probably not that price sensitive) and it more strongly encourages subscriptions for those who do want to read more often. I doubt subscription prices have risen as much as the cover price.

[don]

Re: Peter Schiff: Consumer Inflation?

I thought he was more lazy than clever . . .

[Polish_Silver]

subscription prices

Schiff was clever to use magazines, but not necessarily honest. What effect has the Internet had on the price of magazines since 1998? My guess is that it has reduced circulation a good bit, hence reduced ad revenue so the magazine printers need to find ways to replace that revenue. Raising the cover price works on two levels. It gets more money out of the people who buy a random magazine or two (probably not that price sensitive) and it more strongly encourages subscriptions for those who do want to read more often. I doubt subscription prices have risen as much as the cover price.

You might be right about that. I don't know how to dig up old subscription rates.
The Atlantic monthly is going for $20/year (10 issues). That is cheap enough, even for me. They claim that is 65% off the cover, price, which would make the cover price about $6/issue. The cover price might agree with Schiffs prices.

But weren't cover prices always a lot higher than subscription prices?

[aaron]

Re: subscription prices

The video was not made for itulipers. It was made for the semi-informed masses. I think this is the best peter schiff I have seen and definitely worthy of sharing. No, I do not like the guy.

Magazines and newspapers are sold everywhere. The fact that you CAN buy them via subscription is splitting hairs, in my opinion. I occasionally buy a magazine or newspaper off the shelf. It is expensive.

[lektrode]

Re: Peter Schiff: Consumer Inflation?

I thought he was more lazy than clever . . .

OTOH, mr don - methinks by comparing the actual coverprice increases in the publications cited, that he highlites purrrfectly the doublespeak/doublestandand/bullshit propaganda of their editorial staffs - who either ignore completely or fail to question/complain (as they most certainly would've done LOUDLY - prior to 2009, that is) of whats so blatantly obvious to those who arent grinding the DNC/liberal's axe.

my records for simply med ins premiums show a 12% year over year increase ('11-'12) - never mind from 2009-13, when the premiums went from $344 to 498 - or hey - even my 'old math' seems to indicate the increase from 2004, at $245, to 2013 at $498 = 100%, no matter how they want to spin the effects of the owellian title of the "affordable care act"

and altho the lamestream media's 'top financial schmuck/propagandist' (aka: water-carrier for lower manhattan and the beltway's finest limosine liberals) no doubt can/will spin schiff as some kind of lunatic fringe?

he _wont_ be able to do same to O'reilly's latest - where he poses the question:

"Are We (The People) Responsible For The Chaos That Is Enveloping America?"

and if i had to pin the tail on only ONE donkey, the one i'd give a pulitzer prize for hypocrisy to would that same schmuck who keeps telling us that spending trillions to bailout his pals there on wall st is ok, because 'THERE'S NO INFLATION PROBLEM' ???

and they/he were oh so fond of saying "bush lied" ????

the current occupant and his merry band of bullshit artists are making the prev bunch look like girl scout honor badge recipients (since... uhhh... the boyscouts have been given the liberal 'outing' treatment, for opposing admission of the gender-confused, we cant use them as a paragon of virtue)

[don]

Re: Peter Schiff: Consumer Inflation?

OTOH, mr don - methinks by comparing the actual coverprice increases in the publications cited, that he highlites purrrfectly the doublespeak/doublestandand/bullshit propaganda of their editorial staffs - who either ignore completely or fail to question/complain (as they most certainly would've done LOUDLY - prior to 2009, that is) of whats so blatantly obvious to those who arent grinding the DNC/liberal's axe.

+1, though I stand with his being overall lazy on inflation. He could have done MUCH BETTER.

(Lek, bro, you must really get off this partisan BS - we live in a one-party system. Don't let the PR propaganda compromise your real world insights. Solidarity, Bro.)

[lektrode]

Re: Peter Schiff: Consumer Inflation?

+1, though I stand with his being overall lazy on inflation. He could have done MUCH BETTER.

(Lek, bro, you must really get off this partisan BS - we live in a one-party system. Don't let the PR propaganda compromise your real world insights. Solidarity, Bro.)

+1, bro
i dont mean to sound like i'm advocating for the Repubs, mr don - i despise the politiking of both of The Parties - altho, as a 'small-r' type, i do have a bit more animosity toward THE give it away, give it away, give it away NOW bunch

after having been a fairly keen observer of events/opinions/observations of those in the know since the late 90's, have come to the conclusion that - since 9/11/2001 in particular - that the liberals/dems/media schmucks - and their political hack appointees have done more damage to The USA than _anything_ osama bin laden could have _ever_ done to us....

but other than that, i level the blame - 100% of it - on both sides of the aisle in both houses of congress, since the house is responsible for how the money gets spent, but HILARIOUS as things are, why havent they even been able to come up with a GD budget - since 2007, in particular?

they shoould ALL go without a paycheck until they can come up with one - that BOTH raises taxes AND cuts spending.

and should NOT be allowed to take so much as a weekend off, until they do!

[don]

Re: Peter Schiff: Consumer Inflation?

Once upon a time I was a bizness Republican. Then, as Kunstler neatly summarizes -

one of the political tragedies of recent American history is the surrender of conservatism to religious hysterics, professional ignoramuses, military chauvinists, and flat-earthers.

Now I ain't one. Never was a Democrat. Loathe Liberals.

One of the symptoms of bi-polar two party-itis is if one criticizes an action of one party member, he must - ergo - be in and for the other.

[vinoveri]

Re: Peter Schiff: Consumer Inflation?

Once upon a time I was a bizness Republican. Then, as Kunstler neatly summarizes -



Now I ain't one. Never was a Democrat. Loathe Liberals.

One of the symptoms of bi-polar two party-itis is if one criticizes an action of one party member, he must - ergo - be in and for the other.

True Barry Goldwater conservatism, fiscal conservative and social libertarian has truly been history for some time now, probably as far back as his loss in 1964.

The gov is too big for the society to ever voluntarily go back to earlier times of less government.

Ask yourself how much you depend on the gov for your "livelihood" ... I'm not talking just social redistribution, but gov subsidized industries (healthcare, education, militiary, agriculture) and gov regulated and monopolies granted on certain profession (legal, medicine, etc.). There is no turning back and nor is there a will to turn back. Whatever pet peeve an individual has about one social program or expenditture, there's a high likelihood that that individual benefits from another.

Everyone is now waking up to the giant land grab (the smart observant folks have know this for years). There is no holistic philosophy but just power influence and bull horns, and "true believers"

Yes, it may end like Rome, but recall that disintegration took several hundred years.

[lektrode]

Re: Peter Schiff: Consumer Inflation?

True Barry Goldwater conservatism, fiscal conservative and social libertarian has truly been history for some time now, probably as far back as his loss in 1964.
........
..... Whatever pet peeve an individual has about one social program or expenditture, there's a high likelihood that that individual benefits from another.

i wouldnt necessarily disagree with the ultimate implication of that statement, but - believe it or not - some of us dont directly benefit from most of what passes for 'government' in The US today, once past the traditional and basic .gov services: police, fire, public infrastructure, .mil (strictly defense-oriented expenditures) etc.

but since we now have so many who suckle at the .gov teat - the crony class in particular, along with the public sector unions, the legal mob and now the medical insurance/drug mob etc - all of which depend DIRECTLY on .gov handouts,carveouts and set-asides - i guess i cant fault the concept (too much)

and i would also argue - as a dyed-in-the-wool former resident of the Live Free or Die State, that YES, some of us are quite well able to survive/prosper quite well without any of it, if left to our own devices. (because, YES, 'we did build that', contrary to the propaganda eminating from the beltway - and we did it, DESPITE or inspite even, of the best intentions of the .gov/liberal apologists and their ilk - who cannot even fathom what life without DIRECT .gov support would be like)

Everyone is now waking up to the giant land grab (the smart observant folks have know this for years). There is no holistic philosophy but just power influence and bull horns, and "true believers"

Yes, it may end like Rome, but recall that disintegration took several hundred years.

and i think thats just what the beltway bozos are banking on - but methinks that our devolution/collapse is likely to occur much faster - on 'internet time' quite more likely - as the barbarians in them daze didnt have the personal computer, or the internet, to launch attacks with (and we dont even need to mention the various forms of implements far beyond the slingshot, clubs, torches, spears/arrows they had in romes final years...)

adding: the most obvious reason why We, The People will not and should not give up so much
as '1%' of the 2nd Amendment

after all - look what giving up just 1% did for us the last time we fell for that CONjob

[don]

Re: Peter Schiff: Consumer Inflation?

gov subsidized industries (healthcare, education, military, agriculture) and gov regulated and monopolies granted on certain profession (legal, medicine, etc.).

Never more appropriate - the United States of Subsidies

(lek - still waiting for that paid vacation, holiday or sick daze? Me too. 30 years and counting . . .)

[lektrode]

Re: Peter Schiff: Consumer Inflation?

Never more appropriate - the United States of Subsidies

(lek - still waiting for that paid vacation, holiday or sick daze? Me too. 30 years and counting . . .)

+1, brother don
and i got f__ked out of it the last time i was eligible for one(week), back in the mid80's, after some hedgefund walked away from backstopping the credit line of the hightech co i was working for in the BOS area.

so much for job 'security' = why i have remained mostly self employed since!

but ya know whats forcing me to reconsider becoming a wage slave again????

none other than - oh dont i jess luvs the liberals and their euphemisms....
TA DA!!!

'the affordable care act'

which is sucking down my savings even faster than ZIRP!!!!

makes me appreciate The Guy From Boston baybee, and his POV all the more, dont it?