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BaronIveagh wrote:
Yes, but all the named things burn or potentially burn oil or distillates of oil, so that hardly disproves my point.

It does, actually, if your point is "Oil companies run the world."

BaronIveagh wrote:
Every last one in my area not owned by the government is the property of Shell, British Petrolium, Sunoco, or Exxon. Maybe it's different where you live.

Owned by, or franchised by?

BaronIveagh wrote:
Cars haven't been a luxury since about 1945. The demise of the full service station has been primarily in the last 20 years. As far as the airlines go... I'm glad I don't get strip searched and body cavity checked every time i get in my car, so I can't say that it's 'similar'.

Wrong. In 1960 the US population was ~180 million, 79 million vehicles were held in private and public hands at the same time. Compare this to 288 million vehicles for ~300 million in 2002. If automobiles were a necessity in 1945 you would expect a much higher rate of saturation.

BaronIveagh wrote:
In 1990: a gallon of gas cost $1.15 It now nearly costs $5 a gallon. However, the value of the dollar has been only reduced by half via inflation relative to real goods in the same time period. Compare this to a gallon of Milk, which has only increased on average 85%. While Milk has followed the curve, and almost doubled in that twenty year span, gasoline has increased by nearly a factor of five.

Wow.

Can't really argue with that.

Occasionally dogma knows things.

dogma wrote:

Monster Rain wrote:Wow.

Can't really argue with that.

Watch me.

First of all, your diagram is wildly misleading, as the means by which inflation was tracked by the government in that time shifted vigorously and frequently, by Mr McMahon's own admission. Point of fact, he gets called out on it on his own site and instead presents MIT's 'Billion Prices' data, which is more reliable, but also only goes back a few years.

The data I quoted used three fixed points: the buying power of the dollar in 1775 (point of origin), the buying power of the dollar in 1990, and the current buying power of the dollar. (Comparatively, the buying power of the modern dollar compared to the 1775 Dollar is 3 cents. Now that's a Continental Damn!). Milk was used as the control, though as Mr McMahon points out, goods do not suffer inflation evenly, it was something that could be used as a reference at all three points.

Secondly, reading the fine print at the bottom: you are quoting EIA data, who's methodology has been repeatedly raked over the coals by independent peer reviews, including University of Vermont's Eric Garza, PhD.

BaronIveagh wrote:
First of all, your diagram is wildly misleading, as the means by which inflation was tracked by the government in that time shifted vigorously and frequently, by Mr McMahon's own admission. Point of fact, he gets called out on it on his own site and instead presents MIT's 'Billion Prices' data, which is more reliable, but also only goes back a few years.

How the government tracked inflation is irrelevant to the calculation unless said tracking equation was used to calculate X.

You didn't go to his own site because nothing you've said is referenced there. The metric of comparison isn't even comparable. In short, stop lying, it is obvious when you do it, because you aren't sufficiently learned in this regard to pull it off.

BaronIveagh wrote:
The data I quoted used three fixed points: the buying power of the dollar in 1775 (point of origin), the buying power of the dollar in 1990, and the current buying power of the dollar. (Comparatively, the buying power of the modern dollar compared to the 1775 Dollar is 3 cents. Now that's a Continental Damn!). Milk was used as the control, though as Mr McMahon points out, goods do not suffer inflation evenly, it was something that could be used as a reference at all three points.

No, incorrect. Obviously so. If you compare X to Y and X and Y are both abstractions, then the comparison follows from metric Z if Z is constant (or reasonably so, as dollars are). Anyone who has spent half a day analyzing anything knows this.

BaronIveagh wrote:
Secondly, reading the fine print at the bottom: you are quoting EIA data, who's methodology has been repeatedly raked over the coals by independent peer reviews, including University of Vermont's Eric Garza, PhD.

If a guy that got his PhD after 10 years, in Vermont, is the best you can do; then I'm not worried.

dogma wrote:If a guy that got his PhD after 10 years, in Vermont, is the best you can do; then I'm not worried.

Unless it's either Ben or Jerry.

Monster Rain wrote:

dogma wrote:If a guy that got his PhD after 10 years, in Vermont, is the best you can do; then I'm not worried.

Unless it's either Ben or Jerry.

They put the Delicious in PhD.

dogma wrote:
You didn't go to his own site because nothing you've said is referenced there. The metric of comparison isn't even comparable. In short, stop lying, it is obvious when you do it, because you aren't sufficiently learned in this regard to pull it off.

"For years now in an effort to hide the actual amount of inflation, the Bureau of Labor Statistics (who tracks the inflation rate) has been erasing inflation through a trick called "hedonics".

"Basically they say since a new computer is faster than an old one you get more for your money, so they adjust the price down.They use the same logic for cars and other things. Everyone who studies it knows the Government is fudging the numbers, but it has gotten so bad that now they have to hide the M3 altogether. " - Tim McMahon: http://inflationdata.net/2006/03/16/goodbye-m3-what-is-the-government-hiding/

I may not be a great statistician (I prefer to dig through thousands of pages of documents and distill them into a sensible narrative.), but I do read. Oh, and I know history: In 1921 when the US government started tracking dollar value relative to real goods, they used the exact same methodology I just used above to do their estimates back to 1913. It was changed in 1940, 1951, 1953, 1964, 1978, 1983, and 1995



This shows inflation using the methodology adopted in 1983 vs the post Boskin Commission methodology adopted in 1995.

dogma wrote:
If a guy that got his PhD after 10 years, in Vermont, is the best you can do; then I'm not worried.

Good, then you won't be worried about the doctor who got his MD in ten years in Vermont telling you you're going to die of cancer the other guy failed to detect. I'm not sure what you mean by 'best I could do' there as nothing you mention disproves what the man found.

One thing I can say I do know about numbers: garbage in, garbage out: if the information you're inputting into your formula is bad, then your result is also incorrect. It might be mathematically fine, but it no longer resembles anything in the real world.

How is shadowstats more credible than the US Department of Energy, again?

Monster Rain wrote:How is shadowstats more credible than the US Department of Energy, again?

Neither one is what I would call credible. Shadowstats overlooks the change from using the real values of homes to the use of 'equivalent rents' which had a stabilizing effect, which the fed also overlooks in the other direction (and it's entirely possible that this disparity may be part of what drives the two apart).

Then again, no source is infallible: I for example misspoke and it was 1979 and 1980 that were the point of divergence, not the 1995 Boskin Commission alterations. (Though, again, those changes would also tend to drive the two apart)


http://finance.yahoo.com/news/Inflation-Actually-Near-10-cnbc-357695506.html?x=0

However, since even the dictionary definition of what inflation is has changed since 1980, and the fact that the internet is alive with opinions on it (real/imagined/researched/BS) this argument is as unlikely to go anywhere as a discussion of One More Day, Grey Knights fluff, or politics.

I'm neither a statistician, nor an economist, but if a product is "better," than shouldn't that affect if we view it as costing more or less?

I mean, cars are safer, last longer, and get better gas mileage than they did 20 years ago. The amount of price increase due to inflation has to take that into account. I'm not sure how, but it should.

Polonius wrote:I'm neither a statistician, nor an economist, but if a product is "better," than shouldn't that affect if we view it as costing more or less?

I mean, cars are safer, last longer, and get better gas mileage than they did 20 years ago. The amount of price increase due to inflation has to take that into account. I'm not sure how, but it should.

Well, I don't know about cars, but in reality while a computer is 'better' then the one we bought 20 years ago, the base requirements for that computer have also increased dramatically.

BaronIveagh wrote:Well, I don't know about cars, but in reality while a computer is 'better' then the one we bought 20 years ago, the base requirements for that computer have also increased dramatically.

You mean your expectations of what you want the computer to do has increased dramatically.

I can acquire an early '90s computer on the cheap and load it with Windows 3.1 and it will perform just as well as most computers from the early '90s.

Yeah, that still seems like a fancy way of saying "it can do more for cheaper."

I replaced a $3000 computer with a $400 one, and it did more than the old one. That's in less than 10 years.

In short, it's hard to decry inflation as being that bad when the standard of living has increased dramatically.

Polonius wrote:Yeah, that still seems like a fancy way of saying "it can do more for cheaper."

I replaced a $3000 computer with a $400 one, and it did more than the old one. That's in less than 10 years.

In short, it's hard to decry inflation as being that bad when the standard of living has increased dramatically.

How do you draw that the standard of living has improved because a luxury like a computer now has more power for less?

It now takes two incomes to pay for basic necessities for many families where previously it could be done with one.

biccat wrote:
You mean your expectations of what you want the computer to do has increased dramatically.

I can acquire an early '90s computer on the cheap and load it with Windows 3.1 and it will perform just as well as most computers from the early '90s.

Well, I expect it to type and save files in a manner that can be printed or transferred to other computers. And, guess what, you can't do that anymore with a 1991 PC, as it's no longer compatible with current systems (and find someone that still produces and sells floppies or ink carts/ribbons for printers that old...)

BaronIveagh wrote:

Polonius wrote:Yeah, that still seems like a fancy way of saying "it can do more for cheaper."

I replaced a $3000 computer with a $400 one, and it did more than the old one. That's in less than 10 years.

In short, it's hard to decry inflation as being that bad when the standard of living has increased dramatically.

How do you draw that the standard of living has improved because a luxury like a computer now has more power for less?

It now takes two incomes to pay for basic necessities for many families where previously it could be done with one.

That's one way to look at it. Another is say that social and technological improvements have eliminated the need for a person to run a houshold, allowing extra income to be spent on non-necessities like cell phones, cable, computers, etc.

40 years ago, one aveage income could support a family in a modest home, put food on the table, and pay for one car. That's still doable... it's just that people want more than that now.


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BaronIveagh wrote: (and find someone that still produces and sells floppies or ink carts/ribbons for printers that old...)

http://www.floppydisk.com/

http://www.worldclassink.com/index.html

BaronIveagh wrote:It now takes two incomes to pay for basic necessities for many families where previously it could be done with one.

Um...no, it doesn't. It takes two incomes to pay for the luxuries that we want today.

My FIL was raised in a 3-bedroom house with 8 kids. That house today can be purchased for under $50,000 (<$200/mo. including taxes, insurance, and PMI). A family of four can eat comfortably for a few hundred dollars per month (although you're not eating steak or fresh produce daily, you can get ground beef and canned vegetables at that price).

$1,500 per month ($18,000/year) can provide a lifestyle that most of the lower-middle class lived on in the '50s-60s.

Once you throw in cable, going out to eat once or twice a month, cell phones, new (off the shelf) clothes for everyone every year, and other luxuries, the price of living goes up dramatically.

BaronIveagh wrote:

biccat wrote:You mean your expectations of what you want the computer to do has increased dramatically.

I can acquire an early '90s computer on the cheap and load it with Windows 3.1 and it will perform just as well as most computers from the early '90s.

Well, I expect it to type and save files in a manner that can be printed or transferred to other computers. And, guess what, you can't do that anymore with a 1991 PC, as it's no longer compatible with current systems (and find someone that still produces and sells floppies or ink carts/ribbons for printers that old...)

You can type and save files that are transferrable to other computers. An external floppy drive is ~$15 (max) and connectable (at worst) by SCSI.

TXT and DOC files also haven't changed dramatically, and would be accessible on a new computer. I work with files that are at least 20+ years old on a regular basis.

Polonius wrote:
That's one way to look at it. Another is say that social and technological improvements have eliminated the need for a person to run a houshold, allowing extra income to be spent on non-necessities like cell phones, cable, computers, etc.
40 years ago, one aveage income could support a family in a modest home, put food on the table, and pay for one car. That's still doable... it's just that people want more than that now.

I'll have to stop you there, because I'm still seeing too many people that have two jobs and are having a hard time even making the 'modest home, food on the table, one car' level. It's not a matter of wanting more, it's a matter of there is no money to buy those items.

Polonius wrote:
http://www.floppydisk.com/

http://www.worldclassink.com/index.html

Nice find on the floppies, but the ink place still doesn't carry what I need to finish restorations on the old system that controls the church bells.

biccat wrote:
My FIL was raised in a 3-bedroom house with 8 kids. That house today can be purchased for under $50,000 (<$200/mo. including taxes, insurance, and PMI). A family of four can eat comfortably for a few hundred dollars per month (although you're not eating steak or fresh produce daily, you can get ground beef and canned vegetables at that price).

$1,500 per month ($18,000/year) can provide a lifestyle that most of the lower-middle class lived on in the '50s-60s.

...

TXT and DOC files also haven't changed dramatically, and would be accessible on a new computer. I work with files that are at least 20+ years old on a regular basis.

Where do you live? Because I want to move there! At current market value in this area that's a 150k house. The two bedroom I live in was last appraised two years ago at 85k and it's in less then ideal condition. Currently: it takes, with me living alone, $900 a month, factoring taxes, insurance, etc. I have no cell, cable tv, or car atm, and I split my internet with my next door neighbor. In winter it climbs to $1200 a month due to heating bills.

txt hasn't changed much, but in the last few years M$ has been monkeying with doc a bit. However, I have to carry around a floppy drive and plug it in every time I'd need to transfer a file. Which was sort of the point, as it's making the new computer more backward compatible, rather then having them both be compatible with each other.

BaronIveagh wrote:

Polonius wrote:
That's one way to look at it. Another is say that social and technological improvements have eliminated the need for a person to run a houshold, allowing extra income to be spent on non-necessities like cell phones, cable, computers, etc.
40 years ago, one aveage income could support a family in a modest home, put food on the table, and pay for one car. That's still doable... it's just that people want more than that now.

I'll have to stop you there, because I'm still seeing too many people that have two jobs and are having a hard time even making the 'modest home, food on the table, one car' level. It's not a matter of wanting more, it's a matter of there is no money to buy those items.

Than at least one of the two isn't working full time, or they are living outside their means, or they have medical expenses (which are admittedly higher now. Of course people don't die as often). Yes, two people working crappy jobs have it tough, but so did families relying on one crappy job.

Nice find on the floppies, but the ink place still doesn't carry what I need to finish restorations on the old system that controls the church bells.

Why do you need a printer ribbon for a system that controls church bells?


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Houses in the Midwest central cities can be regulalry had for $50k or under.

BaronIveagh wrote:Where do you live? Because I want to move there! At current market value in this area that's a 150k house. The two bedroom I live in was last appraised two years ago at 85k and it's in less then ideal condition. Currently: it takes, with me living alone, $900 a month, factoring taxes, insurance, etc. I have no cell, cable tv, or car atm, and I split my internet with my next door neighbor. In winter it climbs to $1200 a month due to heating bills.

Here's a single-family 3-bedroom house for $45k (Ohio)

Here's another for just under $50k (Iowa)

And a third just at $50k (Michigan)

I'm reasonably familiar with each of these cities and while the houses aren't in gated communities, they're also not in what most people would consider "dangerous" parts of town.

BaronIveagh wrote:txt hasn't changed much, but in the last few years M$ has been monkeying with doc a bit. However, I have to carry around a floppy drive and plug it in every time I'd need to transfer a file. Which was sort of the point, as it's making the new computer more backward compatible, rather then having them both be compatible with each other.

Not a whole lot worse than a flash drive.

But I think the point stands that if you're simply looking for utility, an old computer isn't all that inferior to a new one.

Polonius wrote:
Than at least one of the two isn't working full time, or they are living outside their means, or they have medical expenses (which are admittedly higher now. Of course people don't die as often). Yes, two people working crappy jobs have it tough, but so did families relying on one crappy job.
...

Houses in the Midwest central cities can be regulalry had for $50k or under.

That would be the difference: I live on a native res surrounded by New York State. Would that I could move, but that costs more then I have.

Polonius wrote:
Why do you need a printer ribbon for a system that controls church bells?

Because it doesn't display the schedule on the screen, it prints it. (I await the day that M$ writes Church Bells 2012, since every piece of software I've looked at to operate this carillon is ancient)

I'd also point out that even for a single person, $900 a month is below the poverty line. If you're point is that poor people have it bad... than I'd agree.

Polonius wrote:I'd also point out that even for a single person, $900 a month is below the poverty line. If you're point is that poor people have it bad... than I'd agree.

I don't know, from the things I've heard the poor have it better than the rich. They have refrigerators. REFRIGERATORS!

Ahtman wrote:

Polonius wrote:I'd also point out that even for a single person, $900 a month is below the poverty line. If you're point is that poor people have it bad... than I'd agree.

I don't know, from the things I've heard the poor have it better than the rich. They have refrigerators. REFRIGERATORS!

I'll admit, listening to some people go on about welfare and how the people on it have it too good, I often think, "why don't you go on it."

I mean, if it's such a sweet deal, why aren't people quitting jobs, moving into section 8 housing, and drawing welfare?

Polonius wrote:I'd also point out that even for a single person, $900 a month is below the poverty line. If you're point is that poor people have it bad... than I'd agree.

Actually I'm fairly well off: I'm actually employed. Most of the people around here are not, since the government banned selling mail order tobacco.

BaronIveagh wrote:
"For years now in an effort to hide the actual amount of inflation, the Bureau of Labor Statistics (who tracks the inflation rate) has been erasing inflation through a trick called "hedonics".

Why, hello Austrian School, why do people pay attention to you?

BaronIveagh wrote:
"Basically they say since a new computer is faster than an old one you get more for your money, so they adjust the price down.They use the same logic for cars and other things. Everyone who studies it knows the Government is fudging the numbers, but it has gotten so bad that now they have to hide the M3 altogether. " - Tim McMahon

That's not an indictment of hedonic regression.

BaronIveagh wrote:
I may not be a great statistician (I prefer to dig through thousands of pages of documents and distill them into a sensible narrative.), but I do read. Oh, and I know history: In 1921 when the US government started tracking dollar value relative to real goods, they used the exact same methodology I just used above to do their estimates back to 1913. It was changed in 1940, 1951, 1953, 1964, 1978, 1983, and 1995

So?

BaronIveagh wrote:
This shows inflation using the methodology adopted in 1983 vs the post Boskin Commission methodology adopted in 1995.

Shockingly different statistical measures report different things. Note also that, returning to the original point, a higher rate of inflation would outpace the price of gasoline at the pump if a lower rate of inflation did the same.

BaronIveagh wrote:
Good, then you won't be worried about the doctor who got his MD in ten years in Vermont telling you you're going to die of cancer the other guy failed to detect.

You know that University X can have a great med school, and a terrible program in ecological economics, right?

dogma wrote:
That's not an indictment of hedonic regression.

Don't look at me, he's the source you brought into this.

dogma wrote:
Shockingly different statistical measures report different things. Note also that, returning to the original point, a higher rate of inflation would outpace the price of gasoline at the pump if a lower rate of inflation did the same.

"The Consumer Price Index rose 0.5% in March, according to the Labor Department. That matched February's increase, the largest since the recession officially ended in June 2009. In the past 12 months, the index has increased 2.7%, the biggest rise since December 2009. The steep climb in food and gas prices could limit consumers' ability to purchase discretionary goods and services. Gas jumped 5.6% last month and has risen nearly 28% in the past year. Food prices rose 0.8%, the largest increase in almost three years." - Los Angeles Times, Consumer Confidential: Inflation rising, led by gas prices; Mattel comes up short April 15, 2011. (Ooooh, Ironic Date!)

Gas is not increasing slower then the CPI.

BaronIveagh wrote:
Don't look at me, he's the source you brought into this.

And I interpreted him correctly, but you didn't.

BaronIveagh wrote:
"The Consumer Price Index rose 0.5% in March, according to the Labor Department. That matched February's increase, the largest since the recession officially ended in June 2009. In the past 12 months, the index has increased 2.7%, the biggest rise since December 2009. The steep climb in food and gas prices could limit consumers' ability to purchase discretionary goods and services. Gas jumped 5.6% last month and has risen nearly 28% in the past year. Food prices rose 0.8%, the largest increase in almost three years." - Los Angeles Times, Consumer Confidential: Inflation rising, led by gas prices; Mattel comes up short April 15, 2011. (Ooooh, Ironic Date!)

Different statistical measures report different figures. This has already been said.


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BaronIveagh wrote:
Gas is not increasing slower then the CPI.

What?

Oh no, commodity X cost less in past dollars than current dollars.

dogma wrote:
And I interpreted him correctly, but you didn't.

"With all its efforts at “Tracking Inflation” most everyone agrees that the last thing the Government really wants is for the general public to know how much it is stealing out of your pockets through inflation."
Inflation has been called “the hidden tax” and that is exactly what it is. When the Government “prints” extra money what do you think it does with it? It spends it of course!"
What would happen if you started writing checks (creating money) from an account that was empty? You’d end up in jail! But that is exactly what the government is doing when it creates money out of thin air." - The paragraph right before the quoted one.


Tell me where the interpretation is in what he's saying here, I'm curious.

dogma wrote:
Oh no, commodity X cost less in past dollars than current dollars.

You might want to re-read that: it cost less in the past in past dollars too.


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dogma wrote:
Different statistical measures report different figures. This has already been said.

Those numbers come from the same set you have been claiming are (more) correct. They would seem to paint a very different picture though then the one you seem to be trying to paint.

BaronIveagh wrote:
"With all its efforts at “Tracking Inflation” most everyone agrees that the last thing the Government really wants is for the general public to know how much it is stealing out of your pockets through inflation."Inflation has been called “the hidden tax” and that is exactly what it is. When the Government “prints” extra money what do you think it does with it? It spends it of course!"
What would happen if you started writing checks (creating money) from an account that was empty? You’d end up in jail! But that is exactly what the government is doing when it creates money out of thin air." - The paragraph right before the quoted one.


Tell me where the interpretation is in what he's saying here, I'm curious.

The interpretation is in the reading, obviously. You did it poorly, I did not.

Still no indictment of hedonic regression. Nice try.

BaronIveagh wrote:
You might want to re-read that: it cost less in the past in past dollars too.

No it didn't, read the graph. Obviously 1979 dollars will zero out in 1979 anyone who has passed high school math will know that.