Metsfanmax wrote:
Your argument is irrelevant to the current discussion. For the entire time that Phatscotty has been aware of money in his life, this country has not been on the gold standard.
Exactly! Just like your entire life you have only known the debt based currency system.
mets wrote: At the very most, all it means is that my numbers from 1913 don't prove anything.
Exactly! And you are the one who brought it up to prove some point or something, which was a fail because you are comparing apples to oranges.
mets wrote: However, Phatscotty's argument -- that a dollar buys less bread now that it used to in 1972,
PS is exactly right isn't he! Even you should be able to admit that, right?
mets wrote:therefore the cost of food has gone up
It has! Because we use Federal Reserve notes, the very notes you've been using your entire life, buys less now than it did in 1970. There is absolutely zero way of denying that, right? So sure, you make the argument that the price hasn't gone up but is actually cheaper, which while true, in the real world using fiat dollars the cost has certainly gone up.
It's cheaper for us to produce these products now than in 1970, but all that savings is eaten away by inflation. It's like you are looking at the one side of the equation but ignoring the other side.
You can't even fathom in your mind that it just may be that you are both correct? Is that such a bad thing?
mets wrote: -- is still literally meaningless because a dollar buys less of basically anything now than it used to in 1972.
Which is the real crux of the problem, isn't it? The prices of things remained stable with very little inflation from 1913 to 1971 even though we changed the monetary system at least twice. But what changed in 1971?
mets wrote:You are making a much more subtle argument,
I'm making the only argument that matters. By the measure in which we use is the problem. And it's not subtle, it's flat in your face a scam. But that's for another discussion I guess.
mets wrote: and it is a lot harder to piece together what the full effect of switching to a fiat currency means for the real prices of various food commodities,
No it's not. How can you talk about real prices when we don't even use real money to buy things? You think it's real because it's the only thing you've ever known. You think inflation is just natural and ignore that inflation is caused by the currency one is using. Sure, supply and demand can explain some inflation, but you yourself know that we have a more bountiful basket now than ever in human history and yet prices people pay are more and more and more. Supply and demand does not explain that, not at all.
mets wrote: compared to the actual efficiency improvements that have changed the real costs of production.
The efficiency of the improvements we've made (on the one side of the equation) are negated by the inherent flaws of a fiat currency, which is what the costs of production and goods are priced in. See, the answer is right there in the other side of the equation. All that efficiency is stripped away by the medium in which we measure these things.
Don't you think we should be considering that in our discussions? If we ignore it then we'll never be able to fix a thing.
mets wrote: However, the whole point of the CPI
The CPI isn't going to answer the question you asked.
mets wrote: is to bypass the discussion of what caused the inflation,
Yes, everyone ignores that don't they?
mets wrote:and just answer the simple question, how much of various goods does a unit of currency buy in X time compared to Y time.
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And PS said that unit currency X (the dollar) buys less now than in 1971. Is he wrong? You seem to think so, somehow.
What is the price of food, mets? By what metric do you measure that? And your measurement should reflect reality. Sure, food prices have decreased when measured in something other than dollars, but that's not reality, is it? Since we use fiat dollars to purchase that food. And we use fiat dollars to buy the equipment, the supplies, pay the wages and everything else to produce those things. And in all those terms, those costs have increased by the measure of the medium in which we call "costs". Are farmers buying their seed with barrels of oil? Are they paying the migrant workers in gold coins? Are the truck drivers who haul the product from here to there buying gas with silver bars?
No! They are using fiat dollars! And all those costs have increased! So you can't really say the price of these goods have decreased unless you apply an asterisk (*) followed by a disclaimer, which doesn't validate your contention at all.
So it's surely correct that PS can say food prices have risen, because they have. Like I said, it's hard to argue that real food prices are decreasing when we are not using real money to buy the food.
It's simple economics really. Well, more monetary policy than anything else. And the current monetary policy today in the US benefits the so called wealthy. Not the so called middle class. Our current monetary system is designed to siphon off productivity, real wealth and assets from the mass of people to a relatively small number of individuals.
That is the true problem from which most of our other problems stem. You can yell all you want about how things are cheaper and point to this or that index and you'll still be met with rolling eyes and scoffs by regular people who know better because they are the one's who are being robbed blind by the design flaw of our currency that you refer to as "inflation".
Believe me, our currency was designed specifically to do exactly what it does. And it does it's job well I admit, but it's unstable, it can't last and it wasn't designed to last for very long. Which is one of the great truths that many people just don't want to see.
But meh, whatever, you'll learn for yourself soon enough through some more real world experience.
And it is right and just for PS to speak up and say something. He is not incorrect. More people should be waking up to the scam that for most people is the only system they've ever known.