Comments on: Real Wages Falling Despite Productivity Gains http://www.nakedcapitalism.com/2007/05/it.html Mon, 23 Nov 2009 08:18:14 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: unlawflcombatnt http://www.nakedcapitalism.com/2007/05/it.html#comment-89 unlawflcombatnt Fri, 25 May 2007 21:29:00 +0000 http://www.nakedcapitalism.com/2007/05/real-wages-falling-despite-productivity-gains/#comment-89 The increase in food prices will reduce the amount of money consumers have to spend on non-food items, such as cars, computers, TVs, etc. By reducing the amount of money consumers have to spend on such "core" items, it will <b>reduce</b> the calculated "core" inflation number. Little wonder that this is never mentioned in the Corporate-controlled media. It would force them to stop using the "core" inflation number as a gold standard. Non-core inflation <b>reduces</b> the measurement of "core" inflation. And, as pointed out by <a HREF="http://www.europac.net/newspop.asp?id=8362" REL="nofollow">Peter Schiff</a>, the "core" inflation number was intended to smooth out short-term fluctuations in the price of non-core items (food and energy). The key here is the phrase "short-term." Year-over-year there is no reason whatsoever to use "core" inflation, because the short-term fluctuations should have evened out. Schiff's point is that "core" inflation is meaningless on a long-term basis. It's the total CPI that counts, not the "core." <br/><br/><a HREF="http://www.unlawflcombatnt.proboards84.com" REL="nofollow">Economic Populist Forum</a> The increase in food prices will reduce the amount of money consumers have to spend on non-food items, such as cars, computers, TVs, etc. By reducing the amount of money consumers have to spend on such “core” items, it will reduce the calculated “core” inflation number. Little wonder that this is never mentioned in the Corporate-controlled media. It would force them to stop using the “core” inflation number as a gold standard. Non-core inflation reduces the measurement of “core” inflation. And, as pointed out by Peter Schiff, the “core” inflation number was intended to smooth out short-term fluctuations in the price of non-core items (food and energy). The key here is the phrase “short-term.” Year-over-year there is no reason whatsoever to use “core” inflation, because the short-term fluctuations should have evened out. Schiff’s point is that “core” inflation is meaningless on a long-term basis. It’s the total CPI that counts, not the “core.”

Economic Populist Forum

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