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Politics : President Barack Obama
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To: Road Walker who wrote (137797)9/30/2013 1:20:59 PM
From: RetiredNow  Read Replies (1) of 149317
 
There's no conspiracy, of course, but there is something called hedonics and substitution. The way it works is that if you used to buy veal, but prices went up, then you switched to ground beef at the same price that veal used to cost, then they consider that there has been NO inflation. But does that feel like no inflation to you? You used to eat veal, but now you eat ground beef. Your standard of living has gone down. For all practical purposes, you have experienced inflation, but the BLS says you haven't.

This is the problem with hedonics and substitution in the BLS inflation figures. It isn't just smoothing, as you have suggested, but rather it is outright biased to the downside, because of hedonics and substitution. All these facts are available on their website. So don't take my word for it. Just do your own research.
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