Topic: Can you quantify inflation? (Read 521 times)

Every population growing will have to deal with inflation.
More people, thus more money to pay for more goods and services.
 

It's not always about being in your comfort zone as a poor person. Sometimes, you might not have the resources to start a business of your own, and that compels you to get a job to earn a livelihood. I don't think any person in this world would choose a job over a personal business if they were given the choice, but they don't always have this choice, especially the poor. So they have no option other than to find a job to earn a living for themselves and their families.

The rich, on the other hand, don't need anything. They always have enough resources readily available that they can use to either start new businesses or expand the ones they already have. When it comes to taxes, even if they have to pay them, it wouldn't bother them much because their businesses earn them enough revenue to be able to pay any amount in taxes each month. Despite this, you are correct that they try their best to take the taxes from their customers.

Inflation effects on small family and it effects on the persons who has less resources of income. Many people who are rich person and who are businessman are not effected by inflation because don't pay taxes and government facilitate them . Most of the tax is paid by poor people because they are debt on country economy but rich person produce jobs and that's why they have relief by government.Rich people know how to escape from tax paying and rich people always work for establishing the businesses and they always try to increase their business but poor people don't work to start business because they want to live in comfort zone and work for their employer.

Inflation is much simpler then that, the prices will always vary for many factors shared around the world.    If 1bn dollars exist and they produce another 1bn in 1 year then you have inflation of 100% and the prices in shops are irrelevant.

I dont want to add more then that especially, politics makes out its variable and tries to muddy the water but the cause is primarily government budget over spend.   The FED dare not ever reverse QE properly as government cannot handle proper repayment, inflation reduces the worth of what they owe and that is the motivation for this constant instability.

Inflation is going to  higher and higher in almost all the countries of the World. After Covod 19, world face difficulties and many challenges of that we saw in all countries. Inflation we will be higher in future because because politicians of all countries are withdrawing the huge amount of money from that. In the result,the prices which of goods increases and  country goes to backward direction. Every country has impact of COVID-19 and many countries did struggle to escape from that disaster and India, China and USA escaped from this disaster . Indian government took steps to overcome inflation and Narendra Modi became successful to overcome inflation and now Indian economy is strong.

Their people that can can actually measure inflation and we are measuring with how everything is expensive and if it is even about accuracy them I will say that is is more than what they think is accurate, things are actually very super high, their are a lot of high chances that we don't have a choice than to accept what ever it is wether it is accurate or not, measuring up is now a very big challenge,  their are experts that might not get the exact data but something very close to it does that are not even close but everyone measures all this things by the hardship that people go through and also factors that lead or even lead to inflation is the policy the government always making unwise decisions and in the process of solving a particular problem they create more problems they won't even have choice again.

I agree that inflation will definitely take some time to get better and we can't see it for the time being, it is not that easy to handle and we can't make that much of noise about it neither. We just have to accept that it is going to be hard to handle and we can definitely consider this as something that is going to be a hard time until it gets better.

We will get better eventually, inflation will be very small again one day and we are going to end up with a much better life but I am pretty sure that something will happen again and ruin the economy again. At this age, I am starting to believe that in order for economy to survive, there needs to be a reset event at times to make things go crazy and then we will spend years fixing and have a few years that will be good and then we are going to have another reset.

By my calculations something could happen right around 2030, maybe a bit before or after but right around that time. So we need to consider that we are going to end up with some good results with time and because of that there is no need to be happy neither because even if we get better then it will get worse again.

This is definitely true, we are not going to see the situation changing all that much and we could see this not changing and because of this we are going to end up with a trouble that would not be that easy to handle as well. I know that it is going to take some time but we can just make sure that we are dealing with something that is taking a bit of a time.

If we can't trust the government when they give us an inflation number (to be fair any number) then what are we going to see? We are not going to see anything changing all that much, it's the same thing and we need to focus on doing the right thing and calculating as an independent company if we can. This should be the most important thing, we can definitely consider this as a good thing and this is why I believe that we need to keep thinking that they are giving lower numbers and not giving the correct information at all. I know that it will take time but it will happen eventually one way or another.

Absolutely every statistic that's provided by the government about the economic situation, including inflation. Keep in mind that it is always far from reality and carries absolutely zero value.
Our local currency strengthened against USD but prices on groceries have gone up more than 30%. Rent went as crazy as 100% and 200% high but that's because after the war, rent demand increased from foreign Russian and Ukrainian migrants. Sadly, our population decided to milk them among with local people and rent here, in Georgia, is as expensive as in Dublin, Ireland, while salaries are ten times lower than in Dublin.
The local government says that everything is okay and the economy is booming. That's far from reality.

I'll tell you more shocking info. Before I say anything, keep in mind that food in my country is way more expensive than in Italy, France and Germany (except meat). If you live or travel in Europe, you'll have an idea how much it costs there.
Our government officials say that a person needs to spend 60 dollars a month to have a diet of 2400 calories a day and in this diet, they'll get all the necessary macronutrients. I can't find the diet but I remember it was like two eggs, 60g of meat, 100g of bread and etc...
This is nonsense, 60 dollars will only keep you fed for 8 days and during these 8 days, you won't have a good, healthy diet.

I would go so far as to say that it is never the only factor. Money printing is often times the consequence of something going on beforehand. I doubt that there is a single historical event of inflation that cannot be considered multifactorial.

What we have seen over the past few years were significant logistic problems all over the world. At first logistic problems kicked in really hard when the pandemic broke out and then other minor and major incidents occurred, like the Ever Given being stuck in the Suez Canal. It caused direct damage and massive collateral damage as the canal couldn't be properly passed by other ships and the supply chain (30% of global container traffic was delayed) took a serious hit.

Direct and collateral damage have been said to be tens and tens of billions of dollars for a seven days period and it's not like it is back to normal within a blink of an eye.

My take is that logistics, then of course tariffs and trade wars, but also military wars and the inevitable need for alternative logistic routes as a consequence are a major driver of inflation. Sometimes I think the money printing is more like the oil being spilled on the fires that are ignited by many other issues.

Drug prices are driven up by corporate patent strategies. It's production monopolies and logistics on the one hand, but plain patents as well of course and then legislation that allows single actors to exploit patents to the max. There are so many things driving up the cost of living that money printing is probably never the only cause for inflation.

You only need one counter example to dispute a theory, and there are countless of examples throughout the years, when inflation was high but there was no money printing been done previously at the same rate. So treating money printing strictly as the only factor, while arguably your best course, is still not always accurate.

Almost every inflation historically recorded has been created because of government programs or policies. The reason the price of goods in your country is rising at an excessive rate is unlikely due to "corporate greed" (people are arguably always greedy), it's most likely due to some bad government decision.

This is quite true, people are doing inflation calculations quite badly and because of this I think we should be doing something that would be calculating our own inflation and try to beat that and would do a lot better with time. This is why I think we should be making some good income with time, so that should be the most important part. I know that it is going to be great with time, and that will get a lot better with time as well and aim to beat that inflation at all times.

I think if anyone could make 10%+ increase on their income every year, it would be hard to get poorer with year, there could be some years that have over 10% inflation at times but we shouldn't be really considering that as the norm, that's only some years and normally that won't happen that much, normally we are going to see much less and not have that much issues and will be under ten percent so we should be making a good amount of profit if we can get that type of income increase.

Since there are people that are specialized in the economic aspect, I think it can be measured in developed countries where things work with policy and where there is price control over almost all its goods. And for the inflation percentage difference in some goods, I think the citizens will only complain of what they do consume.

In my country, there is no price control, the rate inflation is rising without regulation, and every market determine the rate they will sell their goods. These is the main why we are getting a setback in our economy, and nothing is working again, and the price of goods are now out of control.
Only good working government will be able to either control or solve inflation problem. I rather invest in Bitcoin than buying any property in my country right now.

And that's because you say so? Governments do the same thing, they quantify inflation with a basket of goods and services to say that those are the prices that matter to the average citizen but if you have lived through the increase in supermarket prices in recent years and what appears as CPI increase in the news you will see that it does not add up. Or the increase in car prices, even second hand.

My point is that debasement is the real inflation because it is the money that is put into circulation, and that it does not initially go to the goods and services that the average citizen consumes the most does not matter, because it is already in circulation and will continue to circulate, thus devaluing the currency.

This is the problem, if you take the price of carrot and tennis ball and shopping basket and beach towels to calculate the price then you may not get what is the right inflation method. If you really want to see the "real" inflation, things to care about should be price of eggs, milk, bread, meat, if you do stuff like that then you will see it and that would be great. Plus, there are things that goes up far greater than just inflation numbers, even when inflation was fine, school costs were increasing a lot more than the inflation price and now even more, so it's clear that things will change a lot.

At the end of the day, salaries do not go up as much as salaries and that is the real issue. If you make 100 dollars, inflation becomes 10%, then you should be making 110, but they don't, they give you 105, and you quit, and they get someone for 100, and they are in profit, and you look for jobs for six months and can't find one and accept 100 from somewhere else, so companies make money.

Well, I don't think it's false. Here you have two options, either you take all the money printed or you take into account other variables. If you take into account other variables you will end up doing like the government, although in this case you are not doing it out of political interest.

To take into account all the printed money is to take into account all the destinations of that money. If you do not take them into account, as the government does, which includes alcohol although not everyone drinks but does not include bitcoin, what you are doing is saying that the money does not devalue as much as it is printed because there are destinations of the money that do not matter, such as the increase in the price of bitcoin. This way the inflation rate will always be lower than the debasement.

Yes, definitely. But the question is, are inflation measures accurate? The inflation indexes may not actually all correct, as there are also chances of having some lapses, but they aren’t wrong as well. However, with the help of some inflation measures, be it the so called CPI  or other international standards, we can quantify and may derived into an outcome, if not exact, maybe at least its estimated inflation rate.

The government is not just randomly choosing what to include in the CPI basket. It's not like they're choosing A, B, and C and intentionally avoid D, E, and F to come up with better figures. What's included in that basket are the basic goods and services that people commonly consume day by day.

And it's not like they're choosing certain goods to be measured right now so that they can actually pick those particular goods that haven't increased at all or have very low increases. The list of the goods and services are already there. They just go to the market or wherever every month to check on their prices.

Anyway, although inflation can be quantified, ways to measure it wouldn't probably be as accurate as we would want. There will always be weaknesses, errors, shortcomings, and so on. They don't 100% reflect the living situation of every John, Mary, and Peter on the ground. At the very least, however, we can grasp the general picture.

I think it's possible to quantify inflation relative to where you live and what you live on. Someone in a developing economy with a weak currency experiences inflation differently from someone who is using a hard currency.

A blanket percentage for the rate of inflation will work for staple goods like fuel, transportation and the most commonly taken food produce within that region, but when you include in optional products the effects narrow down and start to matter less.

This is quite a nice definition of inflation. However I think I can add a little contribution to what you have here. Well from another perspective it's safe to say that inflation is gradual devaluation of a currency with respect to prices or general pricing of an economy. The effects of inflation are quite obvious to spot out because the whole world as of right now is averagely suffering from inflation. One of the simplest ways to put all these is that same amount of money can't purchase same items like it could a few years back.

Inflation is worse in some economy especially those where it's not properly managed or in countries with insufficient natural resources to combat it. From the stance of the economy of a whole nation to just regular individuals, inflation is a general problem and that's part of the reason why we mention bitcoin hodling every now and then just to make sure we can combat the effect of inflation on us.