You know it in your gut

18 May

Sometimes don’t you just get that feeling in your gut that things are worse than they seem, that what you experience or the information you hear about the economy just does not correspond with your everyday life?

Well, you should trust your instincts because they are probably correct. Rather than believing the statistics the government puts out, you actually experience real world statistics; increasing food and energy prices, a lousy job market and almost no way to save or invest money that returns much.

Here is one reality check when it comes to the prices we experience as consumers. The website takes government statistics and analyzes them to compensate for periodic changes in the methodology the government uses to compute the data.  For example, they have recomputed the Consumer Price Index to keep the methodology consistent with the way it was tabulated before a change in 1990. As you can see, using a consistent methodology (the blue line) the inflation rate is noticeably higher than the official (red) line.

For those of us who actually have to buy things and pay bills, we know that inflation is not the official 2%.

But then we’re smarter than the government, aren’t we!


1 Comment

Posted by on May 18, 2012 in politics


One response to “You know it in your gut

  1. Deborah Sampson

    May 19, 2012 at 9:06 pm

    I walked through Kroger the other day, first time in about six weeks that I meandered through the entire store vice just picking up a few basic items. Anyone who thinks inflation is a mere 2% hasn’t been to the grocery store lately. They probably haven’t even been out of their hidey-hole. Considering that gas prices have more than doubled since 2009, to say inflation is 2% is an insult to our collective intelligence.


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