By Doug Short (Guest Post)
The Fed justified the recent round of quantitative easing “to promote a stronger pace of economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate”. In effect, the Fed is trying to increase inflation, operating at the macro level. But what does an increase in inflation mean at the micro level — specifically to your household? Let’s do some analysis of the Consumer Price Index, the best known measure of inflation. The Bureau of Labor Statistics (BLS) divides all expenditures into eight categories and assigns a relative size to…
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