Well that sounds like an opinion and not fact. It may in fact be fact but how would one really know unless you have a formula that proves what you are saying?
How would you suggest that they are calculated?
I found this.
To calculate inflation based on a "real feel" or "true" inflation number, we would typically take into account factors such as:
- Cost of Living Adjustments: These are often considered to be a more accurate measure of inflation than just the Consumer Price Index (CPI), because they account for changes in the cost of things like housing, healthcare, food, and transportation that impact people’s real-world spending power.
- Wages: If wages have not kept up with inflation, the "real feel" impact of inflation would be more significant, as people may feel that they’re working harder for the same or less purchasing power.
- Consumer Experience: Real feel inflation also considers things like convenience, changes in product size, quality, or availability of goods. In many cases, prices may go up, but the quality of items might decrease, meaning people experience a bigger financial strain than the basic inflation data shows.
Real Feel Calculation
Real feel inflation is harder to calculate precisely, but here are key elements that could be factored in:
- Adjusted for Housing & Healthcare: These are often the largest contributors to the real cost of living and inflation. If housing or healthcare costs have risen significantly faster than CPI, the true inflation rate for a household might be higher.
- Quality Adjustments: Changes in the amount or quality of products people buy (e.g., smaller packages at the same price or lower-quality products) are important to account for in "real feel" inflation.
While the CPI gives a general inflation estimate, many people feel the effects of inflation more deeply in specific areas that impact daily life.
A More Comprehensive Approach
To adjust for real feel inflation, one might:
- Look at average wage growth versus actual cost increases for housing, food, healthcare, and energy.
- Compare individual experiences: If specific categories of spending, like healthcare or education, have seen extreme increases, those could outweigh general CPI numbers for many individuals.
Though it's a more subjective approach,
real feel inflation often suggests a higher impact than official CPI figures might show, particularly for those whose wages aren't keeping pace with their rising living costs.
Would you like to explore this in more detail or get insights on any specific area of inflation?