US inflation rate using Volcker-Era methodology Nearing 10%

US inflation rate using Volcker-Era methodology Nearing 10%

After former Federal Reserve Chairman Paul
Volcker was appointed in 1979, the consumer price index surged into the
double digits, causing the now revered Fed Chief to double the benchmark
interest rate in order to break the back of inflation. Using the
methodology in place at that time puts the CPI back near those levels.
Inflation,
using the reporting methodologies in place before 1980, hit an annual
rate of 9.6 percent in February, according to the Shadow Government
Statistics newsletter.
Since
1980, the Bureau of Labor Statistics has changed the way it calculates
the CPI in order to account for the substitution of products,
improvements in quality (i.e. iPad 2 costing the same as original iPad)
and other things. Backing out more methods implemented in 1990 by the
BLS still puts inflation at a 5.5 percent rate and getting worse,
according to the calculations by the newsletter’s web site,
Shadowstats.com.

http://www.cnbc.com/id/42551209

Correct me if I'm wrong but I don't think gasoline is figured into the current infltion rate

by mrgolf Today at 1:23

""Correct me if I'm wrong but I don't think gasoline is figured into the current infltion rate""

More useless statistics.....
I don't think gasoline OR food are calculated into this statistic..
For the person living on their last 100$ food and gas are a significant expense, (maybe the only one)

This is about as bad an indicator as our trustworthy stockmarket is as an indicator of the countries economic health....

We can make up all kinds of statistics and manipluate numbers over, under and sideways....to prove whatever we wish....

The problem is when those in Ivory towers make desicions that affect us all basied upon these "indicators"

I bet phillymg would know if gas and food were included in the inflation rate. IMO it should be. I tried googling the answer but I can't find the answer

mrgolf wrote:I bet phillymg would know if gas and food were included in the inflation rate. IMO it should be. I tried googling the answer but I can't find the answer

Food has to be. I dont know about gas but as a catagory of energy, it probably is but blended in with natural gas, electricity, etc

you and I would THINK food is important, however

CPI
The core CPI index excludes goods with high price volatility, such as food and energy

http://en.wikipedia.org/wiki/United_States_Consumer_Price_Index

"The "Core CPI" which is what is widely cited in press releases does not include (volatile) food and fuel prices. They were omitted because of (claimed) volatility distorting readings, but many think it was to keep down the COLA adjustments that the government pays in so many places."

http://mariotti.blogs.com/my_weblog/

Investor confidence takes a hit

"The U.S. Bureau of Labor Statistics reported that the consumer price index slipped 0.1% in April. The core CPI, which excludes volatile food and fuel prices, was flat."

http://money.cnn.com/2010/05/19/markets/premarket/index.htm

elvis44102 wrote:you and I would THINK food is important, however

CPI
The core CPI index excludes goods with high price volatility, such as food and energy

http://en.wikipedia.org/wiki/United_States_Consumer_Price_Index

That's what I thought

Well I guess what makes sense to the average person doesn't count. Let's exclude some of the most important things we need. I admit I see the logic but really!

booniebeast wrote:Well I guess what makes sense to the average person doesn't count. Let's exclude some of the most important things we need. I admit I see the logic but really!

Some people believe food and fuel are left out of the equation is to keep COLA lower.

booniebeast wrote:Well I guess what makes sense to the average person doesn't count. Let's exclude some of the most important things we need. I admit I see the logic but really!

This one of those moments of clarity, when you can say to yourself "I knew the game was rigged"....

I would not sit down and play cards with the people in charge of statistics in this country...

elvis44102 wrote:booniebeast wrote:Well I guess what makes sense to the average person doesn't count. Let's exclude some of the most important things we need. I admit I see the logic but really!

This one of those moments of clarity, when you can say to yourself "I knew the game was rigged"....

I would not sit down and play cards with the people in charge of statistics in this country...

Yep. they get together and say we can't make this whole process too simple so everyone can understand it or we'll be unemployed!!!!