The strength of evidence should always be proportional to the claim made. A claim of deflation requires much higher stringency of proof than a claim of inflation. Regarding the query on deflation, I was just saying, in my own flippant way, that I have yet to find any real evidence for anything other than benign disinflation. I could provide the links for CPI, PPI, GDP deflator, but I assume everybody know them and I thought that was going a bit overboard. Besides, the real deflation cognoscenti are immune to data (actually, the lack thereof) anyway.
The reason I didn't answer you before was because I was puzzled by your question. First, I'm asked, hey, is deflation around the corner? I say no. Then you go on about hidden inflation. It's an interesting phenomenon, but doesn't really contradict my point, now does it? For the record, I think it happens, but competition and consumer choice prevents it from being widespread or abusive. BTW, if P&G makes a roll of TP using thinner paper, does that count as a productivity improvement? |
