How they lie is by rebalancing TVs into the inflation figure (which they know will decline in value) and removing fuel and housing costs from the reported figure
The reason they don't use housing costs is because most of the appreciation associated with housing is supply/demand and not actually inflation. The same is true for volatile resources like O&G.
When a shipping tanker blocks the Suez canal and O&G prices go up, that's not inflation, that's the actual value of O&G going up because supply has been reduced.
When your house doubles in value because more immigrants are demanding houses in your neighborhood, that's not necessarily inflation. That's just the value of housing going up because demand is going up despite supply staying the same.
Technology is extremely complicated to use as a correlative factor on inflation. If TV manufacturers change the technology on TVs annually by supposedly improving the technology, which often means the components in older TVs aren't widely used anymore thus supply/demand for older TVs changes and is replaced by new TVs. You get scenarios where older TVs actually cost more than newer TVs not because your currency has somehow appreciated against new TVs but depreciated against old TVs but because no one is producing old TVs anymore, thus the supply is quite low; however, demand might still be there, especially if there was something unique about it people valued. Meanwhile, it's not that there is deflation in new TVs, it's just the new component on TVs might now have a lower cost of production and the MR=MC function might lead to a lower price. This isn't necessarily due to inflation or deflation though.
You think the people at the fed who actually understand things bother explaining anything to the public and especially the truth?
The general calculations are pretty public.
They DO lie and mislead about inflation.
How they lie is by rebalancing TVs into the inflation figure (which they know will decline in value) and removing fuel and housing costs from the reported figure
The reason they don't use housing costs is because most of the appreciation associated with housing is supply/demand and not actually inflation. The same is true for volatile resources like O&G.
When a shipping tanker blocks the Suez canal and O&G prices go up, that's not inflation, that's the actual value of O&G going up because supply has been reduced.
When your house doubles in value because more immigrants are demanding houses in your neighborhood, that's not necessarily inflation. That's just the value of housing going up because demand is going up despite supply staying the same.
Technology is extremely complicated to use as a correlative factor on inflation. If TV manufacturers change the technology on TVs annually by supposedly improving the technology, which often means the components in older TVs aren't widely used anymore thus supply/demand for older TVs changes and is replaced by new TVs. You get scenarios where older TVs actually cost more than newer TVs not because your currency has somehow appreciated against new TVs but depreciated against old TVs but because no one is producing old TVs anymore, thus the supply is quite low; however, demand might still be there, especially if there was something unique about it people valued. Meanwhile, it's not that there is deflation in new TVs, it's just the new component on TVs might now have a lower cost of production and the MR=MC function might lead to a lower price. This isn't necessarily due to inflation or deflation though.
Why are you telling everyone about the plasma TV market. Don’t tell everyone about our secret.