Figuring out how the inflation rate is even calculated involves reading through a ~100 page manual. And while the formula are pretty simple, the consequences are actually pretty confusing (eg, if the basket is re-weighted to what people are buying, how feasible is it for inflation to increase faster than wages even if price levels on most goods increase faster than inflation? Are those items naturally removed from the index?). On the other hand, the M2 monetary aggregate is actually simple - and can be used to find a rough estimate of what % of "the money" an asset entitles somebody to.
If you bought a block of gold in, say, 1990, and use the BLS inflation rate it claims you've made substantial real returns over the last 30 years which seems extremely fishy for owning a pet rock. If you calculate what % of the M2 money supply it entitles you to on the other hand its value is about the same. Slightly less, if my figures are right. Seems much more reasonable, the economy should be gaining value faster than a block of metal.
Basically the sort of people who say complain about central banks and inflation are usually the sort of people who can't understand why everyone is so excited about the inflation rate. The issue is availability of assets which are what is needed to retire or live with a sense of financial security (it is 2020, productivity is off the charts - by the numbers people shouldn't need to work full time to live comfortably). M2 deflator instead of inflation also explains circumstantial stuff like why there was a large unhappy population who voted in Trump, or why the population seems to be a bit tense about money despite apparent real growth.
If you bought a block of gold in, say, 1990, and use the BLS inflation rate it claims you've made substantial real returns over the last 30 years which seems extremely fishy for owning a pet rock. If you calculate what % of the M2 money supply it entitles you to on the other hand its value is about the same. Slightly less, if my figures are right. Seems much more reasonable, the economy should be gaining value faster than a block of metal.
Basically the sort of people who say complain about central banks and inflation are usually the sort of people who can't understand why everyone is so excited about the inflation rate. The issue is availability of assets which are what is needed to retire or live with a sense of financial security (it is 2020, productivity is off the charts - by the numbers people shouldn't need to work full time to live comfortably). M2 deflator instead of inflation also explains circumstantial stuff like why there was a large unhappy population who voted in Trump, or why the population seems to be a bit tense about money despite apparent real growth.