[mesk]

No, why should they, there are many concurents out there.

But! Once the prices go up because of some taxes, they never go as low as they were before. Thats no theory, thats life.

Say good bye, to the prices you see now, you will never see them again ;-)

[hopelite]

There are many concurrents? How do you figure? There has never been as little choice and alternatives, let alone actual competition than today.

A few corporations control most of the food you eat, even less control the food you eat in restaurants. Very few media companies control the "content" you can consume and you cannot even own it, let alone sell or even trade it, and it seems everyone just pays more whether they keep raising their prices.

You own very little, are you getting happier?

[WalterBright]

> Thats no theory, thats life.

It's inflation, which is caused by deficit spending.

The US didn't have inflation before 1914.

[tombert]

That is measurably untrue and it took me about ten seconds of searching to find it. https://www.billmeridian.com/articles-files/inflation.htm and many others. Historically I know you tend to argue pretty dishonestly but this was pretty easy to find and so either you're lying or didn't bother doing any research past reading Ayn Rand.

Also, prices spiking up from incompetent threats of tariffs and not coming down are categorically different than regular inflation. This is obvious and shouldn't need to be explained to you.

ETA:

Just realized that the source for the one I posted was pretty dubious (Bill Meridian is apparently a "financial astrologer", whatever that means), so here's a more reputable one: https://northcarolinahistory.org/commentary/the-war-of-1812/

[alecst]

I think you might have been a little harsh on Walter. Perhaps the answer is more of a "yes and no" depending on your point of view. It does seem like inflation/deflation kind of canceled each other out before moving off the gold standard.

https://www.businessinsider.com/chart-inflation-since-1775-2...

> It is probable that in 1913, while financial panics were not uncommon, high inflation was still largely seen by the founders of the Fed as a relatively rare phenomenon associated with wars and their immediate aftermath. Figure 1 plots the US price level from 1775 (set equal to one) until 2012. In 1913 prices were only about 20 percent higher than in 1775 and around 40 percent lower than in 1813, during the War of 1812. Whatever the mandates of the Federal Reserve, it is clear that the evolution of the price level in the United States is dominated by the abandonment of the gold standard in 1933 and the adoption of fiat money subsequently. One hundred years after its creation, consumer prices are about 30 times higher than what they were in 1913. This pattern, in varying orders of magnitudes, repeats itself across nearly all countries.

Not my area of expertise and no skin in the game, just wanted to point this out.

[tombert]

I am harsh on Walter because he tends to argue in bad faith in order to support some weird pro-business libertarian world view. He's super active on HN (as am I) so I have argued with him and there are multiple times he has said things that are outright dishonest (like once claiming that incompetent workers immediately get fired from corporations, a post I can't find quickly but is in my history somewhere, or trying to paint me as some alien-believing UFO fanboy which I am not).

So when he makes absolutist statements like "there was no inflation in the US before 1914", which is a typical springboard for libertarians to start complaining about the federal reserve and propose some idiotic Ayn Rand nonsense, I have trouble not being literal here.

[WalterBright]

The Fed is the cause of endemic inflation. Look at the chart I linked to.

By the way, I have never read Rand nor quoted her.

[tombert]

> By the way, I have never read Rand nor quoted her.

Fair enough. I tend to use Rand interchangeably for libertarian stuff.

[throwmeaway222]

There is nothing wrong with being a UFO fanboy - anyone that is not these days is psychotic. There have been so many leaks at this point, if you don't believe that's dangerous.

You're all waiting for Trump to claim it or something? It's already been announced.

[tombert]

Kind of off course for this convo, but no I do not think that recent "evidence" of UFOs is very compelling. Feel free to believe what you'd like but I do not think it's extra-terrestrials.

Even if we do some phenomena that we cannot explain as of right now, that does not imply aliens, it only implies that there's something we can't (yet) explain. A lot of the videos that were being hailed as smoking guns seemed to be a combination of camera artifacts and just optical parallax and stuff like that. It doesn't pass my metric for aliens yet.

The thing is, I would absolutely love to be wrong on this. It would be insanely cool to be part of the first humans who found extra-terrestrial life, so if anything I'm biased in favor of these things being aliens, but as of right now I am not convinced.

[JumpCrisscross]

We’ve also been running deficits since the birth of our nation [1]. Perpetual deficits are a post-WWII thing, not post-Fed.

[1] https://www.investopedia.com/ask/answers/021115/how-long-has...

[tombert]

Yeah but that doesn't align at all with the "1914 Federal Reserve is Evil Boogeyman".

A lot of libertarian "bad guys" tend to be pretty reductive, or just outright lies.

[WalterBright]

Inflation started the year after the Fed was created.

See "Monetary History of the United States" by Milton Friedman.

[JumpCrisscross]

Can you quote where Friedman says “inflation [in America] started the year after the Fed was created”?

What you may be trying to say is until about 1900 there was little secular (i.e. fundamental long-term) inflation, given price levels oscillated more than they moved [1]. But the change to steady inflation pre-dates the Fed. And the secular shift to constant inflation starts in WWII, not 1914 or 1976.

[1] https://www.stlouisfed.org/publications/regional-economist/s...

[WalterBright]

Check out the graph:

https://www.visualizingeconomics.com/blog?tag=Inflation

Scroll down to "US Inflation 1790-2015".

"-0.2% Average Annual Inflation 1774-1912"

[JumpCrisscross]

> Check out the graph

Visualizing Economics cites this source [1]. VE seem to lie about what it says.

Measuring Worth shows 1774 CPI at 7.8; by 1912 it is 9.4 [2]. That’s a low, low inflation rate of 0.1% per year, 20% over 138 years. But it’s not zero and it’s certainly not negative.

If we take 1790 (8.86) to 1914 (9.69), MW shows 0.07% annual inflation. That is the statistic you should be pointing to.

But! Within the 1790 to 1914 era we see inflation from 1790 to 1814 (2.75% annually; prices doubled over 20 years). During the Civil War, prices doubled in just five years; inflation 1860 to 1865 was over 14% annually. (CPI inflation goes to 2% annually between 1914 and 1944, 3.7% ‘44 to ‘76, 4.2% ‘76 to ‘08 and 2.4% from ‘08 to ‘24.)

We had inflation in America before the Federal Reserve. It was lower, long term, than it has been post Fed. But the common factor to our inflation is war. To the extent there is a link in these data, and I’m saying this having not noticed this before, it’s between inflation and war.

[1] https://www.measuringworth.com/datasets/uscpi/#

[2] https://www.measuringworth.com/datasets/uscpi/result.php

[WalterBright]

> That’s a low, low inflation rate of 0.1% per year,

See where I quoted: "-0.2% Average Annual Inflation 1774-1912"

BTW, inflation measurements before 1900 are a bit difficult, as how does one compare prices from 1774 with 1912? Not only are records poor, but the goods being compared are wildly different.

I.e. I don't know what the error bars are on the aggregate statistics, and neither do you. 0.1% and -0.2% are realistically well within the error bars. In fact, even today, 0.1% is likely within the error bars, as measuring inflation is fairly difficult, and there's always going to be noise as market prices are a chaotic system.

[JumpCrisscross]

> where I quoted: "-0.2% Average Annual Inflation 1774-1912"

You quoted VE. They misquoted MW. If VE is adding error bars to MW’s data, they—one—should not. But if they do, they should show how they manipulated the data.

There is no legitimate source showing negative annual inflation between 1774 and 1912; your source’s own sole citation disagrees with its claim.

> 0.1% and -0.2% are realistically well within the error bars

What error bars?! They’re the same data!

Your chart on VE says it is showing data from MW. I took those same data and calculated the same number your chart claims to calculate with the same data they link to. The answer is different. And this isn’t, like, I used CAGR and they did simple growth because the sign flipped!

> inflation measurements before 1900 are a bit difficult, as how does one compare prices from 1774 with 1912?

You really can’t. Not meaningfully. You’re integrating data covering the pound sterling, Continental Congress, eras with no federal currency, eras with state and wildcat currency, and a civil war to boot. You’re also trying to compare a basket of wooden teeth and suet with one holding smartphones, gasoline and antibiotics.

But you brought the data and made the claim, and while VE is lying about what their source says, the actual data at MW is actually a legitimate attempt at the problem.