Saturday, September 29, 2007

Crap Fed Data: The Cat is Getting Out of the Bag

Minyanville points to mainstream reporting of what every adult knows: Inflation is already here. Reader's Digest version: the CPI (Consumer price Index) is bullshit.

The counter argument to this is that some items are falling in price like cars, shoes and computers. Here's the problem: I'm not dumping my 2005 Ford Taurus which is now worth $8000 because new ones have gone from $21,000 to $19,000. The cheap shoes are not worth wearing or buying. Is shopping for cheap Chinese crap at WalMart supposed to be an enriching experience? Again, my PC is two years old, am I supposed to cheer that a 3Ghz processor is now only $1200?

All this needs to be against a back drop of 8% health insurance increases, gasoline prices that have doubled in 3 years, a 50% increase in electricity (thank you, Keyspan). Wait until the oil bills hit this winter. There's a picture that summarizes this scenario:

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