So you're saying selling more cars automatically drove up the cost? Nevermind the technology in cars today compared to 1970.Rich wrote:Inflation is hard to get right. 4% might be a better estimate. MD makes a lot of valid points - costs really haven't gone up for the majority of items. In fact, things are cheaper than they've ever been. According to research by Harvard professor Elizabeth Warren (I like her economics but not her politics) the only two things that households spend more on now than compared to 1970s are mortgages and cars. An individual car is much cheaper than in the 1970s but households tend to have more than one car nowadays. In the 1950s only 15% per cent of American households had more than one car.djfourmoney wrote:The official rate of inflation already makes your plan flawed; The Unofficial inflation number is around 9%.Rich wrote:I'm not going to be "rich" by what many people would think of as rich but I am really focussed on having "enough" money. I don't think I have what it takes to be rich but I can get enough money for my needs.
I'm up to year 14 ie if I left my job tomorrow I'd have enough money to last for 14 years (1500 USD per month inflation adjusted - inflation rate of 3%, rate of return of 6% after tax). I'm a way off from getting to my goal of 25 years but really keen to make it.
It also stands to go up, though I don't believe we'll ever experience the hyperinflation alarmist like to talk about.
IMHO and I don't claim to be an expert but it seems to me you need to project what inflation is going to be 10-15-20 years out and adjust whichever one is easier -
Lifestyle or Income source
However the truth is worst than that, since 1970 on some items vital to being considered "Middle Class" have gone up 200-300%!
Cornfed is right, the economy has been basically stagnant since the 1970's, Dean Baker has been saying this for a very long time actually.
See again, it's this love affair with the 1950's I have a problem with. You think adding Women to the workforce is solely responsible for the stagnation in wages? Civil Rights laws allowing more Black People to enter the workforce isn't responsible?
What's wrong with Warren's politics?
Housing has gone up for several reason, most of it has nothing to do with mortgages. The Government used housing as a way to inflate the economy after the DOT.COM crash because the housing bubble started in 1989 according to Chris Martenson.
So basically what you're saying is spending habits increased and that has caused the stagnation in wages and the increases in cost?
Many believe Edward Bernays was partly responsible for selling "You need this product to make you feel good" that allowed consumption to increase as incomes went up.