I've never believed the CPI (Consumer Price Index) to be a true gauge of our economy, but yet it's announcements, along with unemployment figures, among other indexes, have the ability to rally stocks, bond, and down the line, plays a role in the housing market.
I found this interesting article on CNN which goes one step further and discusses an index called the [ame="http://en.wikipedia.org/wiki/Consumer_price_index"]"Misery Index", [/ame]
"Americans are feeling a lot more economic pain than the government's official statistics would lead you to believe, according to a growing number of experts.
They argue that figures on unemployment and inflation are being understated by the government. Unemployment and inflation are typically added together to come up with a so-called "Misery Index." The "Misery Index" was often cited during periods of high unemployment and inflation, such as the mid 1970s and late 1970s to early 1980s."
From [ame="http://en.wikipedia.org/wiki/Consumer_price_index"]Wiki: [/ame]
The CPI has powerful political ramifications, and administrations of both parties have been tempted to change the basis for its calculation. Especially since 1980, the definition of CPI has been altered repeatedly, though economists disagree whether the index underestimates or overestimates the true rate of decline in purchasing power.[1][2]
I often wonder why we, especially during election years, do not hold our candidates and our politicians to a higher standard on what is reported? Should it be eliminated? If so, what would be proposed? Should there be a grading system of certain groups of economists that come closer to the mark? Is the Misery Index a better gauge of our economy?
Is it naive to think that, we, as a country, can enact some enforcement on what is reported?
Discussion?.....................................................
I found this interesting article on CNN which goes one step further and discusses an index called the [ame="http://en.wikipedia.org/wiki/Consumer_price_index"]"Misery Index", [/ame]
"Americans are feeling a lot more economic pain than the government's official statistics would lead you to believe, according to a growing number of experts.
They argue that figures on unemployment and inflation are being understated by the government. Unemployment and inflation are typically added together to come up with a so-called "Misery Index." The "Misery Index" was often cited during periods of high unemployment and inflation, such as the mid 1970s and late 1970s to early 1980s."
From [ame="http://en.wikipedia.org/wiki/Consumer_price_index"]Wiki: [/ame]
The CPI has powerful political ramifications, and administrations of both parties have been tempted to change the basis for its calculation. Especially since 1980, the definition of CPI has been altered repeatedly, though economists disagree whether the index underestimates or overestimates the true rate of decline in purchasing power.[1][2]
I often wonder why we, especially during election years, do not hold our candidates and our politicians to a higher standard on what is reported? Should it be eliminated? If so, what would be proposed? Should there be a grading system of certain groups of economists that come closer to the mark? Is the Misery Index a better gauge of our economy?
Is it naive to think that, we, as a country, can enact some enforcement on what is reported?
Discussion?.....................................................
