retire@40
Thinks s/he gets paid by the post
- Joined
- Feb 16, 2004
- Messages
- 2,670
The government reports that higher costs for energy and food pushed inflation up by 4.1 percent in 2006, the largest increase in 17 years.
The government reports that higher costs for energy and food pushed inflation up by 4.1 percent in 2006, the largest increase in 17 years.
Boy what's the Fed to do? On one hand they need to assist the credit market / sub-prime with lower rates, but on the other, raise rates to stem inflation and a to keep the dollar from collapsing.
That's going to be quite a juggling act on the Fed's part - Stagflation anyone?
Transportation/energy, food, and medical care really increased a lot. However, apparel and recreation didn't (-0.3% and 0.8% respectively).
So the obvious move is to go buy a ton of new clothes and then dress to the nines, go out, and wildly recreate!
My personal inflation rate has been trending negative over the past several months.
My personal inflation rate has been trending negative over the past several months.
Very nearly half of my current expenses (child support and mortgage interest) are by nature 0% inflationary items.
I am fascinated now with trying to determine a personal rate of inflation over the long term, because I have discovered that changing my spreadsheet number for inflation from 3% to 0% moves my FIRE date earlier by 4 years. I suspect Nords' (I think it was his) opinion that changing lifestyle factors will make this impossible to determine.
2Cor521
Transportation/energy, food, and medical care really increased a lot. However, apparel and recreation didn't since their increases were only -0.3% and 0.8% respectively.
So the obvious move is to go buy a ton of new clothes and then dress to the nines, go out, and wildly recreate!
Yep, as long as you don't drive or fly to get there, eat anything or hurt yourself recreating, looks like you cost of living is about the same.
Wow! What categories in your budget are actually going down in price/unit? (Note: not categories you're buying less off, but categories where the price/unit is actually going down.)
Well my personal inflation numbers for 2007 are in (per Quicken):
Overall inflation (discretionary + mandatory items): -1.4%
Inflation for mandatory items: 0 %
What was up?
Food (groceries only): +20% (increase was not due to buying more groceries, but solely to food price increase).
Gas: +25% (increase was not due to driving more, but solely to gas price increase).
Medical and healthcare expenses are such a small part of our budget rigth now that any inflation there would have had a minimal impact on our overall expenses.
Another expense which went up a lot in 2007 (though not included in the inflation numbers mentioned earlier which include only expenses from net income) was taxes: Fed + State + FICA taxes are up +15% (though income is up only 7%).
What was down:
Utilities: -14% (cost cutting measures)
Other things were also down but only because we happened to consume less in these categories (home repairs, furnishings...) during the past year.
Finally some things were down, not because we consumed less, but because we saved money by shopping around (vacation, books, music...).
Firedreamer, you haven't lowered inflation by using less of something, only your standard of living!