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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Mike M2 who wrote (78150)	3/19/2000 9:26:00 PM
From: Lucretius	Respond to of 132070

not for another 2 generations it won't -g-

To: Mike M2 who wrote (78150)	3/20/2000 1:35:00 AM
From: Don Lloyd	Read Replies (3) \| Respond to of 132070

Mike - usajournal.com "Inflation rate double official figures report says..." "...Federal Government Fixed Numbers Since the early 1990s, the federal government has been gradually altering the way CPI is computed by making various adjustments According to economist John Williams, who directs the Shadow Bureau of Government Statistics, a private firm that monitors government number crunching, the federal government has been using several clever and questionable techniques to keep the stated inflation rate low. Mr. Williams estimates that the current annualized CPI is above 5 percent ? more than double the 2.4 percent annual rate reported by the federal government. To create a false and artificially low rate, Mr. Williams reveals, government economists use the technique of "geometric weighting." Mr. Williams states that geometric weighting "gives a lower weighting over time to goods that are increasing in price." The first year that geometric weighting was fully implemented was in 1999. The thinking behind geometric weighting goes like this: if prices rise on a brand name product, consumers just move to generic brands, or use other types of products. It?s s nice theory, but consider why such thinking might not apply to real people. Gas prices have increased dramatically. Have motorists stopped driving cars? Have they begun using buses? Bicycles? Walking instead? The answers are likely no. Quality adjustments are another way the government keeps the stated inflation number low. For example when the government required that an additive be put into gasoline to make it cleaner, the CPI was adjusted to not reflect the price increase that was directly related to the additive. In other words, the end consumer saw higher prices, but because the government thought they were getting a better product, they shouldn?t think of this as inflation! Other quality adjustments include government-mandated changes to auto production such as the addition of catalytic converters. Mr. Williams says these adjustments are "not legitimate if the buyer doesn?t have any alternative. The buyers are stuck paying the higher price." ..." Regards, Don

To: Mike M2 who wrote (78150)	3/20/2000 2:18:00 AM
From: Don Lloyd	Read Replies (2) \| Respond to of 132070

Mike - lewrockwell.com "The Rhyme of History by Sean Corrigan We have quoted before from the writings of Benjamin Anderson, Chief Economist at Chase Manhattan from 1920-37, spanning the period from the sharp post-WWI depression via the New Era madness and on through the Great Depression itself. Much of what he wrote in his masterful ?Economics and the Public Welfare? rings eerily true today. A firm believer in what is now regarded as the Austrian school view that true capital can only be formed by abstinence from consumption and that bank credit is nothing but a temporary substitute for this, his contemporary writings in the prestigious Chase Economic Bulletin constantly warned against the seductive poison of easy money and railed against the Fed for enabling its provision to take place on what was then an unprecedented scale. Writing of the 1924 credit expansion, he excoriated the Fed?s open market purchases of that year, saying: ?..this additional bank credit was not needed by commerce and it went predominantly into securities: in part into direct bond purchase and in part into stock and bond collateral loans. It also went into real estate mortgages?? ?This enormous expansion of bank credit, added to the ordinary sources of capital, created the illusion of unlimited capital and made it easy for our markets to absorb gigantic quantities of foreign securities as well as a greatly increased volume of American security isuues.? ..." Regards, Don