CPI vs PPI, in case you’re curious like me …
CPI tracks retail costs and the cost of living, whereas PPI tracks wholesale costs. As such, PPI acts as an early indicator of future consumer inflation.
CPI tracks retail costs and the cost of living, whereas PPI tracks wholesale costs. As such, PPI acts as an early indicator of future consumer inflation.
There is a fun Canadian paper on how they started intensely decoupling after 2001, alongside the rise of global multi-step supply chains [1].
[1] https://www.econstor.eu/bitstream/10419/261258/1/swp2022-05....
The real inflation value a person experiences is often much greater than the cooked CPI figures.
This is a common conspiracy with scant evidence. The tweaks go in multiple directions and are better explained by the decoupling of PPI and CPI (due to longer and more-international supply chains) than conspiracy.
> it makes comparison of prices and inflation across years pretty much impossible
You can decompile the underlying statistics. Enterprises hire in-house economists to do this regularly.
For consumers, I'd say this is pretty selly, as is relying on nonsense like ShadowStats. Comparing value across long periods of time is almost fundamentally a fool's errand. What's an iPhone worth to someone in 1950? Between zero and a commanding fraction of global GDP.