[j7ake]

Inflation can be thought of as a high dimensional vector with dimensions equal to the number of objects you buy with money.

Each person is affected by this inflation differently because they buy different things.

To “solve” this problem, the government has decided to collapse this high dimensional object into a scalar number.

And now we are seeing a divergence between this scalar number and the actual high dimensional object.

Today with digitised transaction records, there is a ripe opportunity to convert these records back into a person-specific , high-dimensional object with pretty visualisations to aid with understanding.

[em500]

The government already publishes separate indices for a few hundred separate spending categories, ranging from pet food to parking tickets[1]. The reason nobody bothers to do what you suggest is that it's a ton of work for pretty much zero return: the resulting numbers are not actionable and won't change anybody's opinions from what they already believed to be true.

Granted, the BLS indices are not raw prices. But using actual raw prices is a few orders of magnitude more work, and the results are rather unspectacular (if you summarize the price changes into lower dimensions you get similar results as what the good folks at the BLS already did for you) [2]

[1] https://download.bls.gov/pub/time.series/cu/cu.txt, https://download.bls.gov/pub/time.series/cu/cu.series, https://data.bls.gov/cgi-bin/srgate

[2] http://www.thebillionpricesproject.com/

[lottin]

> Inflation can be thought of as a high dimensional vector with dimensions equal to the number of objects you buy with money.

No, that's just the changes in individual prices.

Inflation is the change in the price level, and it has always been that. Nobody has changed subreptitiously the definition of inflation in order to rip you off.

[FabHK]

Inflation the scalar product (inner product) of the vector of price changes and the vector of basket quantities, with the former being uniform for the entire market, but the latter being different for different consumers, which is why an "average" basket is chosen for the official inflation number.

[lottin]

This is incorrect. You're confusing an estimator (the CPI) with the actual quantity being estimated (inflation). For example, the GDP deflator, which is another estimator of inflation, is not a weighted average.

[quickthrower2]

You need a model of all brains. I don’t care that tomatoes have doubled in price in 24 months because I can eat something else. But if all fruit and veg doubles then now we are talking inflation! I can no longer get a nutritional diet at the same cost. But my neighbour eats only McDonalds burgers and is largely unaffected.

So I am not a matrix to apply to the vector. Maybe more like a neutal net.

[FabHK]

You're a vector.

[quickthrower2]

That doesn’t sound flattering but in these pandemic times it is no doubt true.

[ItsMonkk]

Are there any Personal Finance apps that gives you your own inflation number by tracking your spending? This seems like such an obvious feature but I've never seen it.