Exactly. The following phenomenon are all related:
- the record-breaking auction prices of art pieces (Picasso, etc) at Christie's & Sothebys
- the vast pools of money chasing late-stage tech startups driving up late-round valuations,
- the increase in student loans for college students driving up tuition prices outpacing "official" inflation metric
There's also "shrinkflation"[1] which is a form of inflation but does not count in CPI calculations. Also, many homeowners complained that their house insurance went up 20+ percent even though they don't live in a hurricane or flood zone.
The pundits saying there's no inflation seem to only look at the flawed CPI statistic. If the Fed's quantitative easing creates $4 trillion in new money, that has to show up somewhere in the economy. (Unless _everybody_ coordinates to hide all $4 trillion in a mattress to negate its effect.) If citizens are seeing a reduction in purchasing power in real terms, you have inflation happening.
See also, the related phenomenon of a company introducing a new, notionally superior product line at a higher price than the original, then somewhat later discontinuing the original, while never reducing the price of the new one. This results in the cheapest available product becoming more expensive, without this appearing in inflation statistics.
I have the most exposure to this in the realm of medical products. A family member has Type I diabetes, and so must continually buy insulin and blood testing supplies as an everyday expense; several times, he has been forced to switch products (between varieties of insulin, from purely chemical test strips to ones with an electronic reader, &c.) by the discontinuance of the older product. The new one is always much more expensive, and never reduces in price to match the old; this has resulted in a significant increase in his expenses for these supplies, despite nothing ever occurring that would appear in inflation statistics.
>, the related phenomenon of a company introducing a new, notionally superior product line at a higher price than the original,
Yes, and airlines charging a new extra fees for baggage when they used to be included in the base airfare is another form of inflation. This "shrouded pricing" is used to hide price increases in various industries.
I'm not so sure about that. Of course they're not making land any more, but as the price of real estate increases so do rents and economic dislocation, so every rise in the cost of real estate comes with a reduction in disposable income.
- the record-breaking auction prices of art pieces (Picasso, etc) at Christie's & Sothebys
- the vast pools of money chasing late-stage tech startups driving up late-round valuations,
- the increase in student loans for college students driving up tuition prices outpacing "official" inflation metric
There's also "shrinkflation"[1] which is a form of inflation but does not count in CPI calculations. Also, many homeowners complained that their house insurance went up 20+ percent even though they don't live in a hurricane or flood zone.
The pundits saying there's no inflation seem to only look at the flawed CPI statistic. If the Fed's quantitative easing creates $4 trillion in new money, that has to show up somewhere in the economy. (Unless _everybody_ coordinates to hide all $4 trillion in a mattress to negate its effect.) If citizens are seeing a reduction in purchasing power in real terms, you have inflation happening.
[1] https://en.wikipedia.org/wiki/Shrinkflation