Re: Fraud in the CPI


"phil scott" <phil@xxxxxxxxxxxxx> wrote in message
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On Dec 2, 6:57 pm, "John Galt" <whoisjohng...@xxxxxxxxxxxxxx> wrote:
"phil scott" <p...@xxxxxxxxxxxxx> wrote in message

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On Dec 2, 5:03 am, "John Galt" <whoisjohng...@xxxxxxxxxxxxxx> wrote:
"phil scott" <p...@xxxxxxxxxxxxx> wrote in message

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On Dec 1, 7:23 pm, "John Galt" <whoisjohng...@xxxxxxxxxxxxxx> wrote:
"mg" <mgkel...@xxxxxxxxx> wrote in message

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On Dec 1, 10:04 am, "John Galt" <whoisjohng...@xxxxxxxxxxxxxx>
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On Sat, 1 Dec 2007 06:50:28 -0600, "John Galt"
<whoisjohng...@xxxxxxxxxxxxxx> wrote:

"mg" <mgkel...@xxxxxxxxx> wrote in message

<snip>

I think my confidence level in their calculations would be
higher,
if
they only allowed for upward substitutions. If they were to
do
that,
then they could definitely say that the calculation has not
adversely
effected the quality of life. In other words, I would like
the
bastards to change the system so that the base calculation
is
for
hamburger and then allow for steak substitutions, for
instance,
if
the
price of hamburger goes up.

Are you sure that such is *not* adjusted for? (Obviously, the
price
of
steak
can never be less than the price of hamburger, but if the
consumer
were
to
start purchasing steak at a buck a pound after hamburger rises
to
5
bucks,
????)

Steak is steak and hamburger is hamburger. That's not
complex. One is generally agreed to be a "better" lifestyle
than the other (though I might not agree in the case of
Las Vegas Prime Rib which I think is ghastly despite that
I'm an ardent beefivore).

There has never been any suggestion, in any Social Security
document
(which
is the the context we're discussing this in) that the purpose of
Social
Security and the CPI was to "maintain a person's lifestyle."

The CPI is used for a variety of things, including a measurement
of
inflation. So, if it has a lot of downwardly oriented
substitution
options built into it, I would doubt that it's an accurate
measure
of
inflation.

A really basic question that one needs to ask, and to get a
definitive
answer for, is what is the stated purpose of the CPI? In looking
at
Google, I can't see anything that pops up real quick, but I did
find
some specific purposes listed for Canada's CPI. Two of the
purposes
they list are as a "as a measure of general inflation" and "as a
measure of the relative cost of achieving the same standard of
living".
http://www.unece.org/stats/documents/ces/ac.49/1999/crp.1.e.pdf

In the U.S. we seem to have an exceptional propensity for
tolerating
or even encouraging irrationality or ambiguity in government.
That
might not be true and it might simply reflect my ignorance of
other
developed countries, but that seems to be the case, in my
opinion.
So,
I wouldn't be surprised if one might not be able to find a
current,
definitive, formal definition of the CPI in the U.S.

In searching on Google, I did find an interesting definition of
CPI
at
a financial website which says, "CPI. An inflationary indicator
that
measures the change in the cost of a fixed basket of products and
services. . ." Depending on how one defines "fixed basket", I
would
say that definition is probably wrong, or at least misleading,
and
indicates the level of ignorance people have about the CPI in the
U.S.
In other words, it looks like the government is defining it to be
one
thing while the people they represent believes it is something
else.

Well, the wiki has this, which is probably as good as anything.
Uses
of
the
CPI (around since 1919):
a.. As an economic indicator. As the most widely used measure of
inflation, the CPI is an indicator of the effectiveness of
government
fiscal
and monetary policy. Especially for inflation targeting monetary
policy
by
the Federal Reserve; however, the Federal Reserve System has
recently
begun
favoring the Personal consumption expenditures price index (PCE)
over
the
CPI as a measure of inflation. Business executives, labor leaders,
and
other
private citizens also use the CPI as a guide in making economic
decisions.
b.. As a deflator of other economic series. The CPI and its
components
are
used to adjust other economic series for price change and to
translate
these
series into inflation-free dollars.
c.. As a means for indexation (i.e. adjusting income payments).
Over
2
million workers are covered by collective bargaining agreements
which
tie
wages to the CPI. In the United States, the index affects the
income
of
almost 80 million people as a result of statutory action: 47.8
million
Social Security beneficiaries, about 4.1 million military and
Federal
Civil
Service retirees and survivors, and about 22.4 million food stamp
recipients. Changes in the CPI also affect the cost of lunches for
the
26.7
million children who eat lunch at school. Some private firms and
individuals
use the CPI to keep rents, royalties, alimony payments and child
support
payments in line with changing prices. Since 1985, the CPI has been
used
to
adjust the Federal income tax structure to prevent
inflation-induced
increases in taxes.
........as for the other points, i agree. It's was designed as a
broad
indicator, but it's simply too broad to be all things to all
people --
and
as it says above, the Fed now has antoher indicator it's starting
to
favor.

A more intellectually honest approach (and therefore probably
unacceptable) might be to define some additional indexes. As an
example, the CPI might be broken out into two separate indexes: a
consumer price index and an inflation index.

Yep. Or, some CPI's based on lifestyle. Seniors percieve inflation
differently than 20 somethings.

JG

It's a safety net program designed to replace a portion of
personal
retirement income.

JG

That is, unless rich people have

to buy rowboats instead of yachts, but their lifestyle is
unchanged because they've merely made a substitution
and they still have boats.

"It is mere cozenage all."

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wiki is a loosely reviewed repository of fact, opinion and error,
the CPI used to be valid,,,until its basis was corrupted to serve
special govt interests,,,, social securit lists the cpi as its
figure
for COLA adjustments,,, its not rocket science... it is bogus.

Opinion stated as fact. I disagree.

JG

what is going on deliberately.... is the use of an array of control
strategies to fragment US public discussion... these are:

- focus on a wide range of dis-related details, as though they
were
causes.
- hide or obscure the real causes... and motives.
- interject bogus conspiracy theories to discredit any real
investigation.
- encourage loud mouth abusive morons in order to muddy the water.
- delete logic courses from public school curriculum.
- promote focus onto Britany Spears ass.

Phil Scott- Hide quoted text -

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well howz this grab you then Johnnie? will you chant at me
again? or will the obviousness of the misfit as CPI is applied make
any sense to you.... the ramifications are nasty you know... even to
investors as we see routinely, after the tax bitem which can
change...and the arranged economic cycles that seem to pump money away
from the small investor.

yourself no doubt one of the exceptiions....purely brilliant. Its
such a pleasure.

*******

crie CPI was up only 2,3 pct... the fed braggs about it a the time...
the current SS increse is 2.3%.. and IS defined at the core CPI by the
SS adminstration in writing,

Citation, please. I believe you're mistaken.


John... here is the google search result on that issue 1000 links...
first page of links headlne SS COLA as defined by the CPI.
hou dont know how to use google or somehing?

http://www.google.com/search?hl=en&q=%22social+security+COLA%22+++CPI&btnG=Search

this wastes a lot of time.

You lose. First citation:

The first automatic COLA, for June 1975, was based on the increase in the
Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W)
from the ....

I win. Nothing about the core CPI.

Once more, with feeling: You DO know there's a HUGE difference between the
core CPI and the CPI-W, do you not? (I think that at least two other posters
other than myself have told you this, already.) It's not uncommon to see the
CPI-W running at .5 to .6 % a month while the core CPI is at .1%.

JG





Lets assume the cPI is dead accurate for a moment, it isnt, but
lets assume that it is.

We've determined that it's not.


John, in the math. science/ logic discimplies the tactic of making a
deliberately false assumptiion is common. its a way to examine an
issue and arrive at 'proofs'


Phil scott




I will over siimplify to make the point,

- we consider the plight of the average middle class, poor or SS
recipient, raises running way below inflation by any standard, since
1971. ..and for the last 7 years way below core inflation, to the point
that we have headlines about the 'dissapearing middle class'..and
'kids being raised by parents who are never home'...etc. Many,
including most SS recipients,,, living at or below the poverty
line...these buy a few things, ***food, fuel, and medical care***.
Up 15% per year or more,

but the CPI includes,,,

...

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