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<p>[QUOTE=&quot;NPCoin, post: 4668139, member: 5629&quot;]Inflation is most certainly <i>calculated</i> properly.&nbsp; There is no argument there.&nbsp; Inflation itself, however, is a <i>measurement</i> and that is where the problem lies.&nbsp; You have to have the proper measurement.&nbsp; The current measurement utilized by the BLS in their CPI Inflation is inadequate because we do not have one singular economy in the United States (or the <i>world</i> for that matter), but more than fifty separate ones.</p><p><br /></p><p>The BLS CPI takes into consideration literally tens of thousands of prices each month over the spectrum of every economy in this country.&nbsp; This wide spread of products and services is supposed to give a solid picture of the change in the cost of living.</p><p><br /></p><p>However, this assumes that all economies are equal...which they are not, or there would only be one.&nbsp; My cost of living is far different from someone in New York or California (or just about anywhere in the U.S.)&nbsp; The economy in my State is such that the cost of living for a family of seven (including mortgage) is under $2,000 monthly.&nbsp; And this really has not changed much over the past decade.</p><p><br /></p><p>An assumption made in the BLS CPI Inflation model is that all products and services are <i>equal</i> both in use as well as in utility.&nbsp; But, the dollar I make today pays the exact same toward my mortgage as the dollar I made twelve years ago when I bought my house.&nbsp; My car insurance has not gone up these past six years.&nbsp; So, the dollar I make today pays the same toward my insurance as the dollar I made six years ago.&nbsp; I am paying less for gas today than I did back in 2010.</p><p><br /></p><p>All inflation measurements are simply that...measurements.&nbsp; The calculation of those measurements only affects you when (and only when) they are tailored to your exact situation.&nbsp; Otherwise, inflation is a moot point.</p><p><br /></p><p>Now, I have considered the affects of inflation in <i>market</i> analysis.&nbsp; Because the <i>market</i> covers all different economies and situations within those economies that it will give a good <i>indication</i> of future possibilities and helps to determine risks.&nbsp; But, that is a different discussion.[/QUOTE]</p><p><br /></p>

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