The GDP price deflator...
MGLICKER
Posts: 7,995 ✭✭✭
Is a tool used to adjust real GDP to inflation. If I read this chart correctly, the divisor has doubled in 32 years. In other words the inflation rate (as measured by the bureaucrats) has doubled in that time frame.
Of course the manipulators consider a computer with twice the power of 5 years ago at the same cost, to be now half the price.
That sets a lousy precedent when figuring CPI, but is truly deceiving when calculating the GDP. Based on that, the same plant, with the same payroll, making the same 1,000,000 computer units, would add significantly to the GDP based only on the increasing performance.
In fact, the tepid, flat GPD numbers announced today, really show a YTY drop in product, when the loose accounting is factored in.
Of course the manipulators consider a computer with twice the power of 5 years ago at the same cost, to be now half the price.
That sets a lousy precedent when figuring CPI, but is truly deceiving when calculating the GDP. Based on that, the same plant, with the same payroll, making the same 1,000,000 computer units, would add significantly to the GDP based only on the increasing performance.
In fact, the tepid, flat GPD numbers announced today, really show a YTY drop in product, when the loose accounting is factored in.
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<< <i>Right now it doesn't matter, Dow to 17000+ ... >>
True, nothing matters when the dice are hot!
<< <i>Is a tool used to adjust real GDP to inflation.... >>
You would think that would be the goal of the GDP deflator. In reality after GDP is over-estimated to start with........the bean counters then apply an underestimated Deflator to keep GDP as over-estimated as possible.
But on paper it all looks good to J6P.
GDP is nonsense anyway. They count the financial sector as a positive how is that working out for us?