Comments on: Fooling ourselves with low inflation numbers (again)

By: Craig

Craig — Tue, 08 Jul 2008 18:24:42 +0000

Marsha, you can have your 93 accord for roughly $16,000 as for all intents and purposes 93 accord == 08 civic.

By: Terry

Terry — Tue, 08 Jul 2008 14:47:44 +0000

Bill Gross’s article on understated inflation reinforces what at least a few others, (e.g., Ben Stein and Phil Demuth in their excellent book, “Yes, You Can Still Retire Comfortably” ) have been saying for several years, namely that the US is almost surely headed for higher inflation in future years, in large part due to the probability of continuing budget deficits and the underfunded obligations of Medicare and other entitlements. We continue to, in effect, borrow money from future generations and in-debt them, which combined with the nature of our political behavior, will likely lead to consciously or unconsciously inflating our way to “accommodating” those mounting obligations.

By: Marsha Hughes

Marsha Hughes — Mon, 07 Jul 2008 14:57:39 +0000

Philip,
Thank you for the link. I had previously been following Bill Gross on pimco.com but in a recent browser fart had lost the link and totally forgotten about his columns.
I am still baffled at how we now consider a new Honda Accord (at $25,000) to be a bargain when my 93 was right around $15,000. True it didn’t have all of the bells and whistles and safety features that the new accord has, but I always had a problem with the fact that I don’t have any other choice now as far as Honda is concerned because they don’t have a 93 accord new. (I for one wouldn’t mind having the option of paying less for a perfectly good car that I drove until I finally traded it in at 281,000 miles.) I know that is not sound “economic thinking” but it doesn’t seem to make much sense regarding food and gas prices.