[cm2187]

Inflation isn’t measured on an average, it is measured on a basket. They are the same mathematically but the intention matters. If meat goes up 50% and fruits down 50% and the average is unchanged, that means the price of the basket that you will pay at the till is also unchanged, and you aren’t poorer.

Now you can argue that CPI baskets aren’t representative, and I think they often underweight real estate. But that doesn’t mean that you are measuring the wrong thing by using a basket.

It does explain though why the money printing 2008-2019 didn’t translate into CPI inflation, because that money was injected in the financial system, asset prices shot up, asset managers and VC investors got rich, but that didn’t affect main street. In 2020-2022, the pace of money printing massively accelerated and was directly introduced in everyone’s pockets through furlough schemes.