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.

You're definitely right on your point of view and I want to share my own thoughts as well, inflation has been on the rise now and there have been so many measure to quantify it that include the CPI "Customer Price index" you mentioned earlier and yes you can quantify inflation based on  the price of goods of a customer, I can explain abit with my understanding of it.
For example let's say we have two persons, Mr A and Mr B and they are trying to purchase different goods, Mr A would want to purchase goods on lower rates and demands while Mr B would want to get good on higher demands, now the fact that Mr B tend to purchase higher goods based on demands would make it possible for quantifying that goods this leading to inflation but I don't think this school of thought is necessary at all.

Ahh, my heading is buzzing anyway, for a person until or unless the living base is stable he won't care about inflation, as he's making a good living and he knows even if there's high inflation I'm able to service why he'll fall into such discussions, for those who are barely managing their livings it does matters. anyway, that was a random comment but as we are discussing the problem and solution.

According to the general study of the CPI and your comments in my view, there should be a diversified set of data, not like CPI data should cover the inflation in different sectors individually, it will give a realistic and detailed result, Let me elaborate as according to example there are 2 subjects with utility of A B C and D F G respectively, we can categorize their data into 2 sets where  A B C are relevant to the Medical i.e and D F G are related to Food & Agriculture i.e, and if there's a diversified data which is covering both individually it will make sense to both.

I know the practical implementation will still be a question due to its complexity but it's not impossible, this will allow governments to implement their policies in a different direction with a more efficient approach if they are willing.

We can measure but a general number is not possible at all, a diversified number can help a lot already and this what we need as well.

A number doesn't matter, what matters is reality and how willing are you to face it.

What about the meaningfulness after quantifying it? What value does this metric give you?

But what kind of conclusions does one make, even if the results are very accurate?

This is not the strict definition of inflation. Inflation is just what I said. You can have inflation, even without expanding the money supply. For example, if you raise the minimum wage by 100%, then your country will experience inflation, but the money supply will have remained the same.

Using CPI, things people spend more on takes a larger percentage of the basket, which can make things more irregular. This is because even if the prices of jewellery and electronic devices have increased, for instance, the cost of food and health care has not increased as much.

It won't be perfectly accurate in reality, because you can clearly see that the price of your milk has gone up by 8% since the past year, but the inflation rate is saying a 2% increase, but on the larger scale of things, its not far from the truth because you have to put everything into consideration.

I believe the only way we can have an accurate measurement of inflation is by not having a single inflation rate.
We can divide them into different categories. For example, we can have something like;
Real Estate: 9%
Transportation: 10%
Food: 12%
Education: 7%
Health Care: 8%. and so on.
I believe this will give a more accurate figure.

if we're considering an ideal case where whatever agency that's in charge of monitoring the inflation on the prices of goods, services, transportation fares and a lot of other primary things people generally make use of carry out genuine analysis on these things accross different regions without being biased with the final inflation result they bring to the public, then inflation can be measured with those data but if not, the most common way to measure inflation is to go to the people at the grass root and that are not doing well financially and ask how much positive or negative change in the price of goods and services they've witness in a set out area at a particular period of time.

The average man on the street knows that last year, a litre of petrol was sold at certain price and that it has gone up or down by certain percentage by this time of the year. He he can also say same for medical bills, price of foodstuffs in the market and cost of taking care of an household for a week or month. This is the real data that quantifies the level of inflation in an area and if it's to be quantified, it's through this data that you can get an actual difference in the cost of living in different regions of the society.

In Africa two things determine the increase of goods and services in the continent. And those two factors are Petrol and dollar. Whenever these two things increase in rate, every other things would increase and there is no selective goods or services but everything. Inflation is Africa cut across every sectors. And it is the "General Increase of goods and services" is term in Africa. And they are two parties that benefiting from inflation. The Capitalist and the government and the capitalists used the government to inflate the prices so that they can make more profit from their industries.

If the goods in the basket (basket of goods) can be changed then it is possible to measure inflation. And that means inflation is measured by the "basket of goods and services. Though the inflation periods in advance countries and Africa have difference base on the geographical habitation and economic power of the citizens. Inflation hit African countries more than the advance countries.

That's the truth as far as the numbers reported by the government go--it sort of reminds me of when the Dow or S&P 500 get companies added or subtracted from it, and suddenly those indexes start shooting up. 

But aside from my general distrust of statistical abuse, I do see prices not inflating like it was 2021-22, so while the latest report might have been exaggerated, I do think inflation is decreasing.  That's not what takes up space in my head, though.  I'm wondering what's going to happen to the stock market (and crypto, too) once interest rates start coming down--and that's going to happen very soon; it's just a matter of what the Fed decides.  Hopefully they take a conservative approach and only cut the federal funds rate by 0.25% and not 0.5%.  There are a whole bunch of interconnected moving parts in the economy, but inflation and interest rates are among the big boys.

This is a little bit wrong. Inflation is a decrease in the purchasing power of money due to an increase in its amount in the total turnover of the world economy. That is, for each dollar you can buy fewer goods and services than before. Here, the price of goods and services doesn't increase, but the "price" of money falls, which entails an increase in the drawn price tag on goods and services.

It is in the government's interest to understate official statistics in order to reduce social tension, and so they do it. Of course, real inflation and official inflation are completely different. I would be suspicious of anything that has the prefix "official".

By the time you measure inflation, the value of it is already changing (the money printing press never stops), which means it can't be measured (to get an objective figure).

Inflation is felt differently by different kinds of people. In a country, inflation rate might differ by region to region due to consumption behavior, supply, and demographic. Statistical measurements used by the government to assess national inflation might not be the most accurate due to different regions’ experiences with inflation. All statistical measurements allow for some margin of error. You can’t always expect a 100% accuracy due to many factors involved even if we are talking about quantitative data.

Using just one statistical method to quantify inflation would never be enough because while it gives you a picture, it only gives you a part of it and not the whole picture. In concepts as complex as inflation, it’s essential to use different statistical measurements to analyze the whole picture and understand inflation in a much deeper and more accurate way. In research, both quantitative and qualitative methods can be used to come to a conclusion so we can say the same thing with trying to understand or measure inflation.

Aside from CPI, there are also other ways to measure inflation such as: Personal Consumption Expenditures (PCE), Producer Price Index (PPI), and many more. Different statistical methods tell us different things that if we combine all of them, we would be able to get a better understanding of how inflation is in a country. Yes it will not be 100% accurate but it is enough data to make conclusions that will be useful for the government.

I believe people who quantify it are doing as much as they can to provide relevant data. However, to understand and see the accurate results that they could get, it’s possible that they do not have enough data from everyone. This is where international standards come in because they would give them, and if not everyone follows that standard, there may be inconsistencies.

You can quantify it. You need a large amount of data.

The inflation rate is the rate of change of the price of goods and services over time. It can be measured by using the Consumer Price Index, which tracks the different prices of goods and services. The limitation, however, of using CPI as a basis is that its basis may not reflect the diversity of individual consumption patterns. It assumes that the consumers do not change their spending behavior because of changes in price. (controlling for the effect of other variables) and shocks A person's private experience with money may be adjusted. This means that the CPI is a poor measure of personal money experience. The type of people Recessions are perceived in different ways based on spending behaviors. People who rely much on high-priced goods will be most affected. According to the Austrian School of Economics, one does not have enough items of inflation in order to cope with the crisis, like CPI. It just focuses on the position which the currency takes and its perceived value. Even considering such limitations, the importance of measuring inflation comes into view for policymaking. This technique will be utilized in economical planning and comparative analysis. These provide a general insight into the processes in an economy. It is necessary to use other measures besides estimating the impact of the recession, and at the same time appreciate the limitations of such measures To completely understand the impact brought about by the recession.


Valid yes on how inflation is taken as a group and I think the need for a holistic approach in order to closely match the real inflation what the consumer faces. The CPI and other measures of wealth Aim to include many categories like health, education, food, and housing. But Normally, only selected items appear in each of these categories. This approach may lead to a mismatch between the reported inflation rate versus the actual rate of inflation faced by the contracting parties.
You noted: Estimates of food inflation will include chicken, eggs, and rice but probably not go up much, which would indicate the directions of, for example, flour, cookies, or vegetables. In fact, the model here proposed might not mirror the actual price pressures of consumers buying a long list of food products. So, in this regard, though these estimates are an indicator of the impact of the recession on personal budgets, it may not well capture the effects of it.

Multivariate approach to inflation measurement. Other factors considered under each category It can capture the real stimulus of inflation. But it poses difficult problems in data collection and analysis. Therefore, consumers and policymakers must be highly aware of these limitations. other information and personal experiences are brought into the consideration when measuring the true setback of the recession.

I think inflation rate in basket of goods and services already represent the actual thing, like medical inflation, education inflation, foods inflation, housing inflation etc. But I wish the statistic they got after counting all the items instead of only few items.

Like foods inflation, I expect they've check chicken, egg, rice, flour, cookie, cake, vegetable, bread etc inflations, instead of only pick chicken, egg and rice inflations then claim to be whole foods inflation.

The government want to make their citizen fear.

High unemployment rate, high inflation rate, minimum rate etc all of them enforce people to stay in their current jobs, as long as they get paid with minimum rate, they're better than unemployed. They make the employees to not out by telling there are many people are still looking for a job.

Indeed. That's the most accurate approximation, in my opinion. But inflation is more complex than that. I think that, money supply plays the biggest role, but the government can influence with taxes and subsidies, as well. So, it'd still be false to rigorously treat money printing as the only variable of the complex equation that is inflation.

I believe the fundamental flaw lies in trying to quantify inflation. The reason is that there are simply too many variables to account for. In fields like physics or chemistry, quantification works because complex information can be simplified into equations. However, economics is not an exact science where you can conduct experiments or verify outcomes in the same way.

As I have made clear, even if we assume that we know everything about the economy, inflation remains a questionable metric of value. This is because I might rely on goods and services that have increased in price far more than the average. If inflation isn't a useful measure on an individual level, perhaps it holds more value collectively-- such as when assessing the average prosperity of a population. However, certain products are simply more essential and have inelastic demand compared to others. How can your equation account for this?

For example, olive oil may represent a relatively small portion of the market, but it is essential for most people. Even if every other good in the economy experiences 0% inflation, a 300% rise in the price of olive oil would barely impact overall inflation, yet it would be deeply felt by the majority of people.

If you think about it, every metric in economics carries a significant degree of unreliability on how accurately it represents what it presumably measures; inflation, minimum wage, unemployment rate, gross domestic product, consumer price index, interest rates, tax rates. Every measure is the result of humans trying to quantify the economy. This overconfidence, coupled with a lack of humility in believing we can fully understand and predict human behavior, is undoubtedly, in my view, why these metrics are inherently flawed and fallible.

These attempts at measuring inflation are not meant to be absolute, because it's impossible to track the prices of all goods and services all of the time, at least with the tools currently available to us. These metrics are intended to be a rough measure, using a basket of representative products, that is constantly tweaked over time. As long as the statistics gathering agency does a reasonable job at keeping the products in the basket meaningful - that they relate to current consumer trends or the average shopping habits - then it can be a useful gauge of changes over time. It is intended to track the most popular or common items at a certain time, which is the best that we can expect right now.

It's an irony when governments calculate the inflation, isn't it? They set salaries, increase it according to inflation, get subsidized meals, private driver with very expensive car, free fuel, expensive hotels for free, free flights and many other benefits. Life is amazing when you get high salary and are inflation resistant. Yes, it's irony when they calculate our inflation rate and I get so angry about that.

It's very possible to measure inflation for an average person. We have to keep in mind that each product costs different price in different market. It's cheap somewhere but expensive in another place. We have to sum it up and divide and that will be the average price. Sometimes person will buy in cheap supermarket and sometimes they'll be forced to buy in expensive, so we balance the price via this method. For example, my favorite Amarula Fruit Cream-Liqueur 0.7L costs 10 Euro in Netto but costs 14.5 Euro in Edeka. Average price = 12.25 Euro. If it rises by 10% in Netto and by 20% in Edeka, then average inflation for me will be 16%.
If you were spending 300 euro on food before and now you pay 350 euro for exactly the same food every month, then you have 17% inflation in food alone. If you were paying 80 Euro in transport and now it costs 100 euro, you got 25% inflation here, if you were paying 400 euro in rent and now the landlord demands 600 euro from you, you have 50% inflation here (that's a real true story from my friend). And so on...


There should be every best selling product's before and after prices included in the calculation of inflation but let's be honest, no one is going to write down the real inflation rate because the governments don't want to put out big numbers in front of our faces. If you tell the French population that real inflation is 20% instead of 5.9%, what do you think what's gonna happen?
By the way, a rich politician won't even be able to calculate the inflation because they don't get affected by it They don't know what inflation is

The standard way of quantifying the inflation is measuring the gold price which is not accurate though but it's somewhat close to perfect we have, we can identify the real inflation by calculating the value of gold this year and 12 months exactly before and see how much these government lie to us in the name of official report.

They don't even use the word inflation as much cause people are being aware of those terms before so they go more technical terms that people who use money will have no idea of what's happening.

It's useless. They keep going around to make the numbers look good. And for the average Joe that 3% and 6.5% are small, many don't understand it well that those tiny numbers keep adding up year by year.


As it is now, it's pretty much meaningless.
Imho something fixed should be used as an unit of measure, like for everything else (maybe like the good old international prototype of kg was). But what?

Price of a bread, a house or even gold depends on other factors too, not only inflation.
The overall income also rises based on people's knowledge, skills and use of machinery (or even AI).
However a fixed "product" price evolution in time and a fixed "income" evolution in time should be shown. These should depict inflation. They would show how much somebody's income gets diluted and also what a big mess is to keep money in a bank.

Sadly, I don't know what those fixed "product" and "income" would be, so... 

Typical example of:

https://en.wikipedia.org/wiki/Lies,_damned_lies,_and_statistics

I opened a similar thread some time ago, and it is that there is a difference between currency debasement and inflation, which is the same as you say, between inflation (manipulated by the government) and real inflation.

Currency debasement is what is printed and inflation is the result of the calculation of price changes in a basket of products and services. What happens is that the currency debasement or real inflation is always higher than the official one, and it is because much of the printed money goes to things that are not in the basket, such as financial assets, for example Bitcoin.

The way to quantify it is to see what has been printed, the amount of money supply that has increased in a year.

Inflation is the general increase in the prices of goods and services within a given time. However, how general is this? You've probably come across terms such as "real inflation" or the "CPI". The latter, which stands for Consumer Price Index, is announced statistics made by the government, which measures inflation based on a basket of goods.

But, it is constantly confirmed that the CPI does not reflect on the real inflation, as the basket of goods and services is biased. For example, the government can choose goods A, B and C, which only experienced a 3% increase in price, for its basket, while the goods D, F, G experienced 10% inflation.

But, then again, even if you count all goods and services in an economy, how useful would that metric be? If we counted D, F and G, and those six were the only goods in the economy, we'd have a 6.5% inflation rate. (The average of 3 and 10). But human action comes into the equation, and things get messy. For example, if Alice depends on goods D, F and G, while Charlie only wants A, B and C, then inflation clearly influences Alice more than it does Charlie.

This raises the issue of whether it is possible to measure / quantify inflation. What do you think? The Austrian school might have the answer, but I'd rather see what you think about inflation, and is it meaningful to try and measure it? Or, how meaningful is it?