"nominal dollars, or adjusted dollars"? Do you mean adjusted for
inflation, by some CPI-like measure? If so, then prices in those
units shouldn't show inflation. You look at prices of a basket of
goods in nominal dollars. The hard thing is dealing with the
fact that what people consume today is not the same as what they did
70 years ago, so there's no single accurate index of inflation in
terms of goods. Using one commodity, gold, doesn't seem like the
greatest idea: Wanniski is saying, even though your equity in US
companies may buy more bananas, more megahertz of processing power,
more square footage of better-insulated housing, whatever, it's
worth less because it won't buy as much of a particular yellowish, ductile metal.
Thanks for reminding me of the Krugman site, there's some great
new stuff there.
I don't know if Krugman counts as a lefty in Massachusetts,
though -G-.
Cheers,
HB |
