DiscussWorldIssues - Socio-Economic Religion and Political Uncensored Debate - View Single Post - What's the real inflation rate in the US?

**Centurnion** · 03-02-2008, 11:21 PM

Certainly chosing a basket is difficult, but substitution makes no sense because it is changing the basket midstream, and besides, you have to make assumptions about what the switch to is anyways.

As for chosing the basket, obviously the main goods in it should be those goods that are currently not in it, mainly food and energy, because consumers need to buy those things regardless of anything else. I don;t need to buy consumer electronics regularly, but I sure need to buy groceries every few weeks and people who drive have no choice but to buy gasoline.

If the basket is wide enough fluctuations in one item do to outside events (say the price of orange juice due to bad weather) would be minimized.

03-02-2008, 11:21 PM	#21
Centurnion Join Date Oct 2005 Posts 414 Senior Member	Certainly chosing a basket is difficult, but substitution makes no sense because it is changing the basket midstream, and besides, you have to make assumptions about what the switch to is anyways. As for chosing the basket, obviously the main goods in it should be those goods that are currently not in it, mainly food and energy, because consumers need to buy those things regardless of anything else. I don;t need to buy consumer electronics regularly, but I sure need to buy groceries every few weeks and people who drive have no choice but to buy gasoline. If the basket is wide enough fluctuations in one item do to outside events (say the price of orange juice due to bad weather) would be minimized.
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