I hope I don't come across as a conspiracy theorist here... but based on my own experience and also how CPI is calculated. CPI constantly shifts out items to 'mimic consumer behavior' which coincidentally also makes inflation look lower. As someone who hasn't really changed much, our grocery bills went way, way over any reported number. It is probably close to 30-40% in total(2019 to today), but I can't find any old receipts proving as much...yet.
Rent for us is up from 1700 to 2750 for like sized houses (due to not getting renewed, it's admittedly not on the exact same property).
And gas well, that tells its own story.
> Do you see any concern with other people making more money that would not be reflected in an (accurately reported) inflation rate?
No way! If everyone could make 100k a year and we could have 2018 prices back...that would damn near be a utopia.
OK, it's good we agree on that.
About inflation: CPI has some aspects that underreport inflation and some that overreport inflation.
This is actually a serious topic for economists, not just for in conspiracy theory nuts. Though you can imagine that the former focus on different aspects than the latter.
I can write a bit more about this from an economics perspective. Some interesting keywords to look into:
- hedonic adjustment
- gdp deflator
- Big Mac index
Partially because inflation is such a 'subjective' topic, and requires judgement about how much better or worse the new iPhone is compared to last year's model, my preferred model for central bank policy is nominal gdp (level) targeting instead of inflation targeting.
Nominal GDP is the same as total nominal income, and basically just counts up every dollar everyone in the economy spends/earns. No judgement about the quality of iPhones necessary.
(Alternatively, you could target total gross nominal wages. It's almost the same in practice, because the ratio of total wages / gdp is fairly steady over time in the short run.)
Do you see any concern with other people making more money that would not be reflected in an (accurately reported) inflation rate?