/biz/ - Business & Finance

[Anonymous No.30070172]

Why they push the idea that inflation is too low. An anon was asking "if the prices keep going up by 5%, why do they say that the inflation is too low". I can't find the thread so maybe it 404d, but here is the answer and the redpill as to WHY do (((they))) lie about inflation.

You have GDP. This is the quantity of money used for stuff that is bought and sold all over the year. Currently this is used as the indicator of how good your economy is. High GDP = "good".

When you look at GDP growth you take the GDP of this year and minus that the GDP of last year. Now you have YOY GDP growth.

But hey, since everyone prints money and we have inflation, some GDP growth isn't indicative of genuine economic growth but of inflation. So what do you have to do to be hones? Well, you call that YOY GDP growth from before the "nominal GDP growth" and then you subtract the inflation effect from it. What you're left with is just pure economic growth, right?

Well....

[Anonymous No.30070263]

>>30070172
They're pushing it as being too low so they can pursue inflationary policies.

[Anonymous No.30070324]

>>30070172
Cost of housing was remove from CPI.

[Anonymous No.30070357]

>>30070172
>WHY do (((they))) lie about inflation
its not (((them))), it's the FED
the fed lies about it because it thinks it's "under control"
it isn't, they think inflation is ok because they can just deflate it later by selling back bonds and returning the dollars to their treasury
it won't

[Anonymous No.30070409]

>>30070172
thats a man

[Anonymous No.30070677]

>>30070172
Remember two years ago when they had to do the repo injections because the banks didn't have enough money to lend to eachother to have the minimum balance of cash? There wasn't enough cash in circulation back then in relation to the debt. They used covid as an excuse to give out helicopter money under the guise of "helping out working class families". They had to slow down money velocity so they could throw cash into the system without hyperinflating the currency.

[Anonymous No.30070730]

>>30070172
...yes, to be honest, you have to then kind of say "the nominal GDP growth was 7% but the inflation was 5% so the real economic activity increased by only 2%".

But then, what happened in the USA was that ever since 2006-7 financial crisis, the GDP growth never came back. EVER. The (((experts))) were getting worried and they didn't know what to do to shut up the little man. Year after year, the economy was going to shit. So they decided.

If we just take the inflation out of the equation, we will be passing nominal, inflated GDP growth to normies and they'll keep quiet. About the central banks saving the economy......

[Anonymous No.30070811]

>>30070172

[Anonymous No.30071152]

>>30070730
...so what was done was that the inflation measurements were adjusted in the sense that whenever something raises its price a bit too quickly, it will be taken out of the inflation basket. For example, when the pork, butter, milk, poultry raises prices, there is always some "underlying explanation" to it: swine flu, bird flu, global butter shortage etc. Now, pork for example did jump in price by some 20% a few years back, and it was taken out of the inflation basket for that year, but it didn't get back to the old prices but instead remained at the new higher prices.

This is the general rule in industry. Prices are kept constant, despite increasing cost until they abruptly change due to any small trigger all over the entire sector. This is why you generally get a steplike increase in price of products every few years. In the west, the price increase is now simply taken out of the data.....

[Anonymous No.30071453]

>>30070172
thats a guy

[Anonymous No.30071539]

>>30071152
...apart from the price increases being simply omitted you also have an extremely wide range of new agricultural technology which is making food cheaper (GMOs, new agents and antibiotics etc.). So in an honest economy, the food would actually be getting cheaper. By a lot.

Apart from that factor there is also a whole new level of mass production of food never before seen. The animals that we eat are bred and fed a diet that makes them grow insanely fast. They lay in their excrements all day and never move because this makes them grow faster. The fruit today is completely different than the one from 20 years ago, an apple remains fresh for 2 years in the warehouse etc. The food quality is lower, we are generally consuming the lowest imaginable quality of food.

And still, despite the above two factors, the prices go up and we can't even measure how fast because there would be riots on the streets.

But yeah, there's more.....

[Anonymous No.30071742]

>>30070811
>COUCHA

[Anonymous No.30071846]

>>30071539
>>30071539
continue, some things you are saying are obvious, but continue giving the pill to newfags.

[Anonymous No.30071929]

>>30071539
...so when it comes to technology, they also devised something useful. In the field o tech, oh bhuoy. All the technology is getting more expensive to produce, but guess what, it's also constantly developing.

The top of the line smartphone from a few years back costs a half of what the price of the top of the line smartphone from today is. And that's true for al manufacturers. The same is true for PCs, TVs, everything. But guess what the (((man))) decides to do here. They tell you, "well, you ahve to look at the product with the same specifications.". Literally. They measure the inflation by looking at how much cheaper Apple is selling old unsold phones which are now derelict.

Yes, you read that right. When looking at inflation in technology you literally have too look at what the price of old hardware is today and how it has changed over the year, when it moved from brand new to average or from average to old......

[Anonymous No.30072236]

>>30071929
...now any critique of this approach fas swiftly ended by introducing something which they now call the "hedonic factor". In short, the fact that technological stuff is getting more expensive isn't due to inflation, but our gluttony. This one is pure genius if you ask me.

....

[Anonymous No.30072491]

>>30070324
what's included?

[Anonymous No.30072600]

>>30072236
...and just to cap it of as to why they are doing all of this.

This is because the west has not had steady economic growth for well over a decade. And if the numbers were openly handed to the peaople there would be demands for a revolution.

If you want to know how bad things really are, go back for all the years after 2007 and take away some 5 % off the purported GDP growh. What do you get. You get NEGATIVE. Every single fucking year. NEGATIVE. By several percent. The west has been fucking dying for well over a decade now and the inflation measurement is there just to keep the normies shut.

In 1950's America, a man was working. He had a wife at home, two cars, a house he bought, and three kids he could send to college. All while working as a baker, office clerk, etc. Now, both the man and the wife have to work, can't afford to even feed more than two kids, chose between paying for a house or a car and the kids take out loans to go to college. Yes, it shows.

[Anonymous No.30072751]

>>30070409
came here to post this
wasn't disappointed

[Anonymous No.30072906]

there are people who get paid in THIS asset.. ridiculous

[Anonymous No.30073014]

there are people who get paid in THIS asset.. ridiculous

[Anonymous No.30073199]

>>30072491
Changes every year . I remember they especially loved this trick. Ladies' purses. May sound strange, but here's why.

Ladies' purses used to be high quality leather in the west and they used to cost a fortune. Then with globalization, the plastic products from China slowly moved in and took over the market. Chicks liked them because they were cheap and they didn't mind the wear and tear since they want to get a new look every once in a while. Better than keeping the old leader bag for over a decade.

And so, they kept on ladies' bags and all similar products, wallets, socks, everything that was now mass made at a cheaper quality and cost in China in the inflation measuring basket.

A good leather purse costs a woman several hundred $ and a plastic replacement which looks just as nice costs 20$. Stuff like this helped the inflation basket for several years.

[Anonymous No.30073299]

>>30070730
Basically, the GDP has been "growing" via an increase in dept. That's why the economy is full of zombie corporations that only stay afloat by borrowing money. If you understand that dept is basically taking the products of future production into the present, coupled with the fact that the real (productive) economy hasn't recovered, you realize what kind of absolute shit-show we're in for.
Dept only works if it increases future production to pay it back, instead we pay for dept with every more debt.

[Anonymous No.30073458]

>>30073299
>we're in for.
and when will that "in for" happen

[Anonymous No.30073957]

>>30073458
This is a slow death, not a bang.

[Anonymous No.30073970]

>>30070172
brehs...

[Anonymous No.30074088]

>>30073957
so stocks will see massive profit taking similar with other assets, but, not crypto?

[Anonymous No.30074121]

>>30073014
OMG IT KEEPS DUMPING
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