I Think I'm Gonna Throw Up Now...

[BlueStreak]

38. Please stop hoping and start studying

A good place to start is to really understand what the insidious chained CPI is and does.

We already had a bogus CPI formula. It has always been based on a "market basket" of goods that were supposed to represent the essentials. But a good percentage of the things included in that market basket are agricultural items that are essentially price-controlled. So while that artificial market basket shows inflation of (say) 1.5%, the rest of what we buy is actually inflating more like 5%. At the same time, the Fed has been artificially holding interest rates near zero while "printing" loads of money, so if a person has any savings, they are losing ground to the real inflation rate and their future Social Security payout is being reduced relative to actual inflation every year.

Chained CPI just accelerates that. The concept behind "chaining" is simple. If you cannot afford regular groceries, you will choose to eat dog food rather than just die. And dog food costs less, so if you can live cheaper, then you really aren't affected by inflation. So we can take the already bogus CPI and make it even lower.

That, in a nutshell, is chained CPI. Obama is a smart mad. He understands this is equivalent to "let them eat dog food", yet he is willing to go there. That tells you everything you need to know.