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Comment by bingbong70 | Hacker News Reader

Keynesian/neo-keynesian "soft money thinking" kills enough brain cells that people start to believe the CPI formula (that was altered 2-3 times since we closed the gold window to hide rampant inflation) is valid...that is the primary purpose of fiat education and fiat propaganda.

Anybody buying the 2% inflation number doesn't recognize the actual 15-20% hurdle they have to jump over every (non-covid) year and will inevitably get poorer unless they are directly tied to a "cantillon channel"... in which case they will only stay rich thanks to what amounts to fraud.

More accurate inflation calculation - https://chapwoodindex.com

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You're telling me prices double ever 4 years or so? I don't think so.

Chapwood "Index" is produced by the same person behind many of the conspiracy theories around Seth Rich's murder [0], not really a brilliant objective source of inflation metrics. I'm not claiming the CPI is perfect, but taking a look at market expectations of inflation also gives you a pretty good picture of what is going on, and it's not a 4 year doubling of prices.

[0]: https://en.wikipedia.org/wiki/Murder_of_Seth_Rich

> Anybody buying the 2% inflation number doesn't recognize the actual 15-20% hurdle they have to jump over every (non-covid) year and will inevitably get poorer unless they are directly tied to a "cantillon channel"... in which case they will only stay rich thanks to what amounts to fraud.

You have absolutely no evidence to support this.

The only reason the cost of living goes up in the major metros listed there is because housing went up there, and that's not inflation or the cantillon effect (which I concede exists but is nowhere near as big as you make it out to be) -- that's because city councils aren't permitting new construction.

Your comment is a manifestation of proportionality bias. You think a big change in the affordability of housing in SF has to have a big cause like the global economy string pulling illuminati cantillon magic. The reality is far more banal. It's straight-up simple supply and demand. Strong economy in and around SF creates demand for living in SF. The city council doesn't permit new construction. This limits supply. Low supply, high demand, big prices - which the well paid tech workers can afford. That's it and that's all man.

Naturally when demand fell as a result of the pandemic prices went with it.

One of CPI's big limitations is that it only considers consumer goods and services (the "consumer" part of "consumer price index"). But "consumers" themselves spend a good deal of money on other things, namely health, education, and housing. SlateStarCodex had an article about that: https://slatestarcodex.com/2017/02/09/considerations-on-cost...

Do I think those who stay wealthy in real terms are able to do so via "what amounts to fraud?" No. Nor do I buy your 15-20% hurdle assertion: if your annual salary of say $100,000 was worth just 10% less each year (as in, real inflation of 15% minus 5% worth of nominal income growth, a generous income growth assumption) $100,000, over just five years, it would be worth the equivalent of ~$60,000 in year 0. It seems like a stretch to suggest that everybody but the rich are seeing their real incomes almost sliced in half every five years. Use the 20% number or a more conservative assumption for income growth and the numbers start to square even less with reality.

Whim, when you do eventually find out you are wrong, come back and upvote my last comment, lol.

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