So, what is the REAL inflation rate?

[Tab]

Supposedly we're at 5.something percent, but we changed our calculations about 10 or 15 years ago.

It used to measure various things, including food staples, price of bread, etc., but they ended up being pretty stable, so it was rejiggered to better reflect current price of living. In fact, I remember an informal "Big Mac" index, which compared places and time to the cost of a "Big Mac" from McDonalds.

However now, food staples are cranking up again, with the diversion of corn into ethanol - bread, cheese, tortillas - all of those are getting pricey.

I've heard estimates that it's relatively closer to 12%, an outrageous number, but perhaps it's somewhere in the middle, like 8.5%. Any ideas?

All I know is that if I go through the express lane with 10 items, all about $3 or $4, and 10 items isn't much, that's $40 right there, and it costs me $60 to fill my gas tank, and my heating costs will be double what they were two years ago.

[Sanity Claws]

1. I'd also like to know what the real unemployment rate is.

The government has F'ed with the numbers so much that they sound like Pravda.

[Tab]

4. This has long been underreported.

They like to report how many new applications, and how many people are on it.

Unfortunately, it fails in a few respects:

- You cannot be on unemployment forever. Eventually it runs out, and you're "off the list", so you're not counted. In other words, if you don't get a job in six to 12 months (some states offer extensions) then you are not longer collecting unemployment, and as far as the government is concerned, I guess, you're not one of the unemployed, even if you don't have a job.

- You might be under-employed. Maybe you had an $80,000/yr job, but now was forced to take a much lesser position somewhere else - maybe for $35,000. You're still "employed", but it's not equivalent.

- You're a consultant. Perhaps your business sucks wind now, but as long as you are "conducting business" (e.g.: answering phone calls from potential clients) then you don't qualify. There were a ton of consultants during the Internet boom years (I was one) but after it bottomed out in 2002, I found that I couldn't collect unemployment because I still answered the phone if someone called.

[Jackpine Radical]

2. The cute thing here is that they have no interest* in letting us find out

because that would not have good results at all--it might either incite the masses (who are presumably not noticing those price increases everywhere) or cause us to raise SocSec payments to the undeserving geezers.

________________________
*No pun intended, of course.

[enid602]

12. Social Security

Let's hope you don't need SS some day. Statistically, most will. I just read that the average net worth (including home equity) for people 44 to 55 yrs old in the US is only $133K. If negative house price trends continue, the average net worth for these folks might go down as far as zero. Heaven help them.

[Jackpine Radical]

14. "Some day" is more-or-less here for me.

I'm eligible now, but will hang on 'til 66, because I continue to work for a living (have to, in order to pay health insurance until both wife & I are 65) & they would take my SS away for earning too much. After 66, that restriction goes away.

[Warpy]

3. There isn't that much corn going to ethanol

because there aren't that many cars out there that can run on it. The price jump is entirely due to the price of the fuel it costs to produce our food, from mechanized production in the field to transportation to storage to processing to distribution to the lights in the grocery store. It all adds up.

Blaming it on ethanol production is in error and just another anti environment meme from Big Oil. Too much ag waste like sorghum stalks can be used for ethanol to have edible corn be diverted in sufficient quantity to account for the inflation we're seeing.

One more thing needs to be pointed out: Greenscam changed the CPI market basket during his tenure to reflect falling expectations. Instead of an occasional steak or roast, the best it saw was the cheapest grade of hamburger. Instead of fresh fruit out of season, it used canned pie filling, and so on. It became an index of increasing poverty, not a reflection of inflation. By artificially reducing the cost of a market basket by cheapening its contents, he was able to hide the true inflation rate for years. This is felt most severely by seniors on Social Security, although it was used to depress everybody's wages. Now the CPI excludes food and fuel, as though we could teleport to work and live on air.

Various estimates have been out there that have pegged the inflation rate at 7.5-10.5% per year, and that was before the current rapid inflation.

[whistle]

6. 80% lost to the floods in the mid-west

[Warpy]

8. Don't forget the drought in the southeast, another prime corn area

There are a lot of reasons for food prices to be going up, none of them ethanol production.

[enid602]

13. God forbid

God forbid we have less corn going to high-fructose corn syrup; we´ll run out of Super-Gulps, lose weight and look like French people. we wouldn't want that, now.

[whistle]

5. Most definely double digit as the annualized 1.1% jump inprices last month suggests 13.2%

...offically, but we know that the real rate is more than twice that level now

http://www.bls.gov/cpi/home.htm#data

[Elwood P Dowd]

7. Food and energy are not included in core inflation

plus they have all these neat little substitution tricks. I believe they started tweaking the figures late in the Carter administration or early in the Reagan years. My best guess would be at least 7-8 percent if they used the old real world "basket of goods" methods from 35-40 years ago.

[lpbk2713]

9. We probably won't have any idea how bad off we are until February 2009 or later.

BushCo has been doctoring and hiding all the data that is used in making the statistics for years.

We will have to wait until the Dems take over to get to the truth.

[mmonk]

10. Around 11%. Real unemployment probably around 10-15%.

[CanonRay]

11. Go to Shadow Statistics

Link: http://www.shadowstats.com/

[pokerfan]

15. The CPI excludes food and energy prices

which are deemed "too volatile." So as long as you don't eat or use any energy you should be fine.