So... If they're projecting that the average family will be spending

[cornermouse]

$85 more this year than last for school supplies, should that be considered a potential inflation index marker?

Just askin'.

[liberal N proud]

1. Oh, No that is just the cost of the fuel to get to the shopping center

There is no inflation
:sarcasm:

[fasttense]

2. No, that is not counted in inflation estimates

put out by the government. You can replace paper with stone tablets (which you can gather outside for free) and pencils can be replaced by a chunk of coal. Under Greenspan the government doesn't keep the market basket the same each time inflation is measured. It changes to a less expensive item when the item in the market basket goes up. Eventually all you have left in the basket that measures inflations is dog food and a can of peas.

[sweetpotato]

3. Hey -

the brand of dog food I buy has SHRUNK. The price marked on the can is the same, but the volume is less, by a couple of ounces. They are putting my dog on a diet!

[whistle]

4. That is the right idea but the wrong technique....

....government does not downgrade the market basket to calculate inflation, they simply lie about inflation.

[unblock]

6. actually, he's correct, they DO downgrade the market basket

then again, you're probably right, too; they probably also lie about inflation ON TOP of all the sneaky adjustments they do.

there are actually TWO forms of downgrades: one is "substitution" the other is "hedonics".

"substitution" is what fasttense described -- as the price of the basket good goes up, people naturally substitute a cheaper alternative. so the new basket weighting counts the cheaper item more and the inflating item less on the grounds that the cheaper item is now a larger part of peoples' purchasing. of course, that's how people COPE WITH inflation, but that point seems to be lost on those who control the official statistics.

"hedonics" is a further adjustment based on the "improvement" in the product. this year's car is better than last year's car, so you can't say that the entire price increase is due to inflation; part of that price increase is due to the fact that you're getting a better product. of course, this is obviously subject to manipulation and gross distortion. it's especially inappropriate in cases such as cars, where the exact same new car as was available last year simply isn't available anymore. if people could keep buying brand new 2005 accords every single year, but CHOSE to step up to the 2006 model, then hedonics might be at work. but they can't buy the 2005 model anymore, at least not brand new.

[ClintonTyree]

5. Hell no........

the bush economic miracle continues to chug along on all cylinders. :sarcasm:

$85 for school supplies will be a drop in the old bucket compared to the increase in the price gas and fuel oil this coming winter. Not to mention the price increases at the grocery store and every other good or service we use. The economy is screwed......big-time and it won't be long until we have "bushvilles" and soup kitchens dotting our American landscape as the American Dream becomes a total nightmare. Welcome to the second great depression. You're doin' a-heck-of-a-job, bushie! :mad: