from Stubborn Things, The Symptoms Are Not The Disease
The difference today is about 2% official inflation (blue) versus about 9% (gray) based on the pre-1982 calculation. Inflation isn’t absent, it’s just been officially “recalculated” and adjusted away. Proof of the adage, if you still need proof, that there are lies, damn lies, and government statistics.
Inflation is not merely rising prices. Prices rise (and fall) for lots of good free market reasons related to supply and demand. The disease of inflation results in rising prices, too, but it reflects not the increasing value of a good or service, but rather the decreasing value of each dollar used to pay for that good or service. Specifically, inflation is the result of the bastardization of the currency due to irresponsible printing of money.
CEO’s are not stupid and don’t believe the official inflation numbers. CEO’s don’t invest where the currency is being bastardized. CEO’s don’t grow the business where growth is being punished by regulators and bureaucrats. Global firms can invest and grow elsewhere in the world, but it’s entrepreneurship in the US that really flounders. Smaller domestic companies just aren’t started, or deliberately remain small.
Because of currency manipulation, bastardized statistics and ‘blood letting’ regulation, we are stricken with weak investment and low growth of GDP and payrolls. It really is just that straightforward.