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Inflation in GDP trending down, Ed why ?

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  • Inflation in GDP trending down, Ed why ?

    Why is the GDP deflator trending down, while inflation is screaming an uptrend ?

    Is it lagging inflation that badly, or some other reason ???

    The GDP deflator is the third panel from the bottom. Blue line.

    InflationCharts.jpg

  • #2
    Re: Inflation in GDP trending down, Ed why ?

    Originally posted by icm63 View Post
    Why is the GDP deflator trending down, while inflation is screaming an uptrend ?

    Is it lagging inflation that badly, or some other reason ???

    The GDP deflator is the third panel from the bottom. Blue line.
    In my opinion, the algorithms behind the deflator are just plain poorly executed at best - in other words, its a false stat and just like CPI only worse. Right before and during the beginning of all recessions it drops, and that's so far from what really happens that its hardly worthy of comment. The academic and ivory tower proofs of it are beyond ridiculous in my opinion.

    The last quarter it was 2.2% and the highest that it has been since 2000 was 3.5% in early 2006... and if anyone thinks that inflation has been that low, I have some offers for them involving things like oceanfront property in Idaho.
    http://www.NowAndTheFuture.com

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