http://www.cnbc.com/id/42551209 Change a few definitions, and voila! No inflation. The attempt to prop up demand through easy money is going to give us a double dip, with the second more painful than the first.
So they changed the method to make the 1980s look better. Ever since, Republicans have cited Carter's double-digit inflation (it lasted about 2 minutes) and how low it was under Reagan.
The difference is the 1980s were better, economically speaking by almost any measure. You were alive during the 1970s. Doesn't this period have the same feel?
Hmm, this is somewhat like the recession in the early 80s, but much worse. Then we had industries and living wage production jobs in this country, they had not all been outsourced. When the slowdown hit, factories were idle. Now we do not have factories, so the is nothing left to recover.
This website does a great job of showing the true numbers. http://www.shadowstats.com/ They compare what inflation would be like today based on previous ways it was measured. Some interesting charts under the 'Alternate Data' tab.
Quoting from the article in the opening post: 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. “Near-term circumstances generally have continued to deteriorate,” said John Williams, creator of the site, in a new note out Tuesday. “Though not yet commonly recognized, there is both an intensifying double-dip recession and a rapidly escalating inflation problem. Until such time as financial-market expectations catch up with underlying reality, reporting generally will continue to show higher-than-expected inflation and weaker-than-expected economic results in the month and months ahead.”
It's the recession I most compare this one to. The lesson is to see the policy prescriptions we used to get out of it, which were the opposite of this one. We had a strong recovery in 82/83 and have bounced along the bottom for two years with this one.
The 80's were nothing more than a continuation of the 70's. Prices kept rising, pay levels were stagnant or actually dropped. For most Americans it was the beginning of the end of the American Dream. Actual taxes nearly doubled with the loss of the deduction for medical insurance/expenses, interest rates reached previously illegal levels, health and safety regulations were ignored and unenforced, AIDS swept the country, illegal immigration skyrocketed, hate of America spread around the globe...GOOD TIMES! If your name was Buffett, Gates or Allen, then it was great economically. But for most Americans there was no darker decade than the 80's, economically speaking. It was far worse than anything we are experiencing now.
The 80's were nothing more than a continuation of the 70's. Prices kept rising, pay levels were stagnant or actually dropped. For most Americans it was the beginning of the end of the American Dream. Actual taxes nearly doubled with the loss of the deduction for medical insurance/expenses, interest rates reached previously illegal levels, health and safety regulations were ignored and unenforced, AIDS swept the country, illegal immigration skyrocketed, hate of America spread around the globe...GOOD TIMES! If your name was Buffett, Gates or Allen, then it was great economically. But for most Americans there was no darker decade than the 80's, economically speaking. It was far worse than anything we are experiencing now.
80's were a complete bust and looked to be unfixable until Clinton came along in 92 and saved our ass with some 3 card monty. Like most drunks, Bush Jr was not much good at playing cards and went all in with Halliburton, losing our grandchildren's inheritance in the process. A black man was quickly selected to be the scapegoat.
