The True Measure of Inflation

Mark J. Perry, a professor at Michigan, has a fascinating chart I’ve added below. It shows the truest measure of inflation—how much time it takes to buy certain items. By this measurement, most consumer goods are dramatically cheaper than they were 60 years ago.

I would add that this as dramatic as this chart is, it probably understates the case of deflation because it doesn’t adjust for the dramatic rise in quality.

Posted by Eddy Elfenbein on March 4th, 2009 at 11:37 pm

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.