On Wednesday, November 2, 2016 at 3:14:40 PM UTC-5, dadiOH wrote:
wrote in message
...
Inflation, which has run below the Fed's 2% target for years,
How many years? At 2% it would take about 36 years for prices to double.
My pocket book tells me that prices are about 2.5 times - or more - what
they were 20 years ago, nowhere near what the government claims. For
example, in 1996 I could buy a gallon of paint thinner for less than $2.00;
now, it is $9.98. I could buy a senior ticket to a movie for $3.00; now it
costs me $7.50.
However, inflation is great for debtors, the federal government being at the
top of the heap. BTW, federal debt in 1996 was a bit less than 1/4 of what
it is currently (5.2 billion vs 19+ billion).
IOW, the government's CPI doesn't reflect the real world.
http://www.bls.gov/cpi/cpid1609.pdf
Go to page 87 of this PDF and you can see the annual percentage inflation for the past 45 years. Couple pages above and you can see the annual inflation for the prior 56 years before that.
Here are the annual inflation rates since 2005.
2005 3.4
2006 3.2
2007 2.8
2008 3.8
2009 -0.4
2010 1.6
2011 3.2
2012 2.1
2013 1.5
2014 1.6
2015 0.1
The CPI is comprised of normal everyday items people purchase. It shows the change in prices for a basket of these goods. Not sure if housing, gasoline, etc. are included or not. Some of the inflation rates include or exclude these types of items. It is what the average person buys. The CPI would not capture the cost of living for an over the road truck driver who sleeps in his cab and eats at diners and never pays utilities or does anything else except drive. And the CPI would not work for an 80 year old wood worker who lives off the grid and eats day old bread and peanut butter only and uses tung oil and hand planes and chisels and hand saws only. AVERAGE American is the key here. CPI is applicable to most people. Paint thinner? Senior movie tickets? Does the average American buy these items? None of my friends do. My parents could buy the tickets if they ever, ever, ever went to the movies. They don't so its inapplicable to them.