It has often been discussed that the government’s CPI is an inflated number. For that reason, I am very happy that Google has taken upon itself to calculate its own cost of goods estimate based upon items sold on the internet. A much simpler process is to simply calculate the CPI according to the methodology that the Fed used prior to 1980:
Inflation, using the reporting methodologies in place before 1980, hit an annual rate of 9.6 percent in February, according to the Shadow Government Statistics newsletter.
According to John Williams, the site’s creator:
Though not yet commonly recognized, there is both an intensifying double-dip recession and a rapidly escalating inflation problem. Until such time as financial-market expectations catch up with underlying reality, reporting generally will continue to show higher-than-expected inflation and weaker-than-expected economic results in the month and months ahead.