Consumer inflation running at whopping 10% if we use 1980 accounting methodology.

[Selatius]

Below here is the CPI measured before Clinton:



As you can see, under Clinton the CPI was revised to the current orange line. Notice how it states inflation as being lower than the blue line. The blue line is how inflation was recorded during the Reagan Administration. A new experimental line is seen as the orange line. It is believed that this will become the newest way to measure CPI. This one was introduced by Bush Jr.

This CPI chart below records inflation using 1980 methodology, the same one used under Carter:



If we measured inflation the same way it was measured under Carter, we're looking at inflation that almost rivals the inflation seen during the oil crisis of the 1970s and during the revolution in Iran at the time. The red line is the officially reported CPI number. Notice how with Reagan it starts to diverge from the blue line and under Clinton the divergence grows into a chasm after Clinton revised the reporting of CPI.

http://www.shadowstats.com/cgi-bin/sgs/data

[SoCalDem]

1. Crude prices

[Selatius]

2. I can't help but think it's gonna get worse than 10% looking at your graph.

Of course, I'm talking about inflation with food and energy included back into the measurement, not this core inflation crap Wall Street reports.

[papau]

3. He appears to over correct the errors - at least to my eye - for Alan Greenspan's innovations of

removing "product improvement" from the CPI (in the 80's - and without regard to changes in the cost of accomplishing a given function) and product substitution ( in the early 90's - and a code word for the decrease in standard of living in too many cases as there is no inflation if you can no longer buy steak but for the money you once paid for steak you can get ground meat ).

What the hell this has to do with Clinton is beyond me - perhaps the OP can explain.

Meanwhile Greanspan's Bush Presidency gift to the CPI of setting up his "adjustments" so that massive increases in the trade deficit force decreases in the CPI when there are obviously no such decreases is well documented and not even the subject of any disagreement as far as I can see.

The site that the above charts are taken from does not explain what adjustments he is making but it seems clear from the numbers that he is simply removing Greenspan's innovations in how you calculate the CPI.

The problem of course is that product improvement so as to do the same function for fewer dollars should be removed from the CPI - but a larger hard disk drive in this years Xmas computer for the office does not mean the payroll accounting is getting done for less money than it could be done last year with that years Xmas computer for office. Likewise substitution makes a sensible adjustment when there isn't a standard of living decline involved, but it appears that much of the lowing of the CPI is due to a decrease in the standard of living.

But his numbers are interesting - as is the fact that he claims to have made a living undoing Greenspan's changes and selling the results by subscription.

[KAZ]

4. One of the most important posts to hit this board.

And upon these rates does all commerce lie. Increases in entitlements, public and private sector salaries, Fed policy, all depends on this phantom rate, which the government produces. Real inflation is very palatable to us common folks. The crap CPI number is just a way for your government, and your company, to keep your increases down. What irks me the most, is that it's just so painfully obvious.

[roamer65]

8. Yes, you bet.

The lower the cooked numbers, the lesser the increases given to Social Security and other entitlements. I think Bernanke knows exactly what he is doing. Cook the numbers and let inflation do its dirty work.

[Mike03]

5. Nothing to add, just kick and rec... NT

[Richard Steele]

6. K&R

[lovuian]

7. You can lie but this paychecks don't and people have been

screwed royally by the Federal reserve and government

energy and food and healthcare have all skyrocketed

Inflation is here and people won't be able to buy

Recession is on its way

A crisis is coming Huge federal deficits and unemployment