The Job Search And Career Advice Blog header image 2

Inflation or not?

May 14th, 2008 · 5 Comments

Posted by

This is a quick aside… cause I don’t get this. Someone might be able to enlighten me in the comments. I’m no economist.

I don’t know about you, but the last few months, conversations amongst friends and co-workers, etc… it’s all been about how expensive everything is. Gas… we all know. But have you been to the grocery store lately? Jeepus.

And yet, the govt. claims that inflation is “under control.”

How much longer can this fiction go on? Do you know anyone who believes we haven’t seen inflation in prices recently? On the one hand, they say inflation is fine… yet gas is at record levels and food prices they admit have gone up the most in 18 years!

And there’s no inflation?!! For who? If the record rising price of fuel and food don’t count as inflation, maybe I don’t understand the definition of the word.

No related posts.

Tags: Uncategorized

  • Willy

    From Wikipedia…

    “Although ‘inflation’ is sometimes used to refer to a rise in the prices of a specific set of goods or services, a rise in prices of one set (such as food) without a rise in others (such as wages) is not included in the original meaning of the word.”

  • Brian

    If food and fuel mean nothing in inflation figures… then call me dense. I don’t care about inflation figures relating to steal or health care costs (though, those go up double figures every year, right? seems to never figure into the inflation calculations) or the cost of cheap plastic stuff bought from China.

    Here’s a thought… if the govt. had to acknowledge that the REAL cost of living and working is higher than they’re letting us know… gee… it costs me 25% more this year just to commute to work… gee… a gallon of milk is 40% higher than 2 years ago… then they’d have to raise wages, right? More than a nominal 2-3%.

    Hmmm… maybe you’ve hit on the key there. If inflation doesn’t include wages, then we can all pretend we’re not paying more for stuff.

  • Mike

    Don’t mistake the rise in the price of the commodity for the decrease in the value of the dollar. Rising prices means just that, rising prices. Inflation (as I understand it) is kind of a measure of the demand for the dollar. (Think of the dollar as a commodity). If the dollar’s in high demand, people want it more. Used to be the fed’s job was to control inflation (eg-keep demand for the dollar high). Imagine a situation where commodity prices are constant, the only way we’d pay more is if the dollar was worth less. That’s inflation.

    However, honestly, When you blink and try to imagine how there could be “under control inflation” I’m right there with you. It is fiction. The dollar’s value is pretty bad these days. That’s part of what drives me nuts about politics these days. Used to be being republican meant being a fiscal conservative. Bush was in office over 6 years before he vetoed a single spending bill. (sigh)

  • Willy

    Um, the government can’t just go ahead and raise wages. It doesn’t work like that. In fact, if they did that by pumping more money into the economy, that would just make inflation worse. The only way to increase wages is to increase productivity.

  • Tom

    Core inflation, which is what the government usually states, doesn’t include energy and food costs. The reasoning is that these items spike and ebb frequently which could cause bogus numbers. Like, after Katrina and all the refineries were shut down, gas prices spiked. Or a frost in Florida cause citrus prices to jump. Take out energy and food and you have a more level measure.

    Unfortunately, today these prices are consistently higher and much higher than normal. So, the intent of smoothing spikes and ebbs don’t apply today. The gov’t is currently unwilling to use the total inflation numbers because they look bad. Eventually they’ll have to admit inflation is much higher than intended.