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Is the gov't an economy?
- Thread starter nutmeg
- Start date
It seems the disconnect between the inflation experienced by ordinary consumers and the government numbers, in the U.S. anyway, came about as hedonics began to be used in computing the inflation rate.Quote from vicirek:
India Government 7% means real inflation of minimum 20%. By the way talking about governments and economy: is there anybody believing government numbers besides the government?
Naturally the government can reduce its expenditures on entitlements indexed to inflation by adopting the lowest possible headline inflation rate. Keeping the official rate low may also be helpful in financing debt at lower interest rates. So there is an incentive to keep the official rate as low as possible.
I have relied on the rates reported on John Williams' website www.shadowstats.com as being more realistic, because they are computed as they used to be before hedonics began to be used.
Quote from zdreg:
"better to have taxpayers pay the poor, than force employers to pay them"
you can't force employers to hire them.
As an employer you have a simple choice, you can either do the work yourself or pay the going rate. No "force" is needed. The only thing required is professional government and smart policy.
Quote from piezoe:
It seems the disconnect between the inflation experienced by ordinary consumers and the government numbers, in the U.S. anyway, came about as hedonics began to be used in computing the inflation rate.
The confusion regarding inflation rate is because they want you to be confused and that is why various "statistics" are used.
Inflation is about stealing money from those who currently hold assets by printing or supplying more currency. Therefore inflation can be expressed in a single number in monetary terms as money supply or Fed balance sheet expansion.
Prices and interest rates are lagging indicator because inflation already occurred well before there is uptick in prices and interest rates. Simply by the time people recognize inflation the money have been already stolen.