Where's deflation ? The Fed's double standard

[PlusMinus]

Why is nobody acknowledging that CPI is no longer calculated the same way as it was prior to Clinton? Well that is not the same as the calculation that the Fed uses for PCE Core inflation, but it used to be.

http://www.shadowstats.com/

 

[PlusMinus]

Quote from kashirin:

wrong again -
so you say people will avoid buying a car for 10K because next year it will cost 9.9K?

if I need a car now - I will go and buy it. deflation doesn't apply here - especially if deflation like 1-2%

if I need a house and it's a good deal - for example I save 2K on rent per year
and it costs 100K will I wait to buy a house for 99K in a year?

if someone needs cancer drug and die in 6 months will he wait to buy it cheaper in a year?

Al economic laws that apply to electronics all apply to anything else -cars, houses etc.
Deflation would encourage innovation and increased productivity
It can't be bad
In 19 century US was in deflation for tens of years and nothing bad happened


I don't really see any downward spiral here.
The only downward spiral is for debtors who are addicted to cheap credit

What? People have been avoiding buying houses lately at least in part because they don't want to jump on sinking ships. I'm speaking of those with credit or assets to devote to a property. A car costing $1k less yoy is not an example of spiraling deflation.

 

[achilles28]

A deflationary spiral has never occurred outside the Great Depression.

That prolonged deflation largely resulted from the Gold Standard. Which no longer applies.

Tales of an apocalyptic deflationary spiral is nothing but economic fear-mongering.

Assets become overvalued in Bull Markets.

Assets become undervalued in Bear Markets.

Cheap assets provide the bottom for value in a Bear Market, and the resumption of investment, which evolves into recovery.

Any deflation hawk care to cite real world examples of catastrophic spiraling deflation? I would love to see it.