The official 3% inflation rate is understated through flawed methodology like hedonic indexing and substitution, the speaker argues. If the government's understatement is 50%, real inflation is closer to 4.5%. At worst, it could reach 6%.
Well, now they're getting to claim at least partial victory over the battle with inflation, saying it is only only about 3%. And in reality, we all know it's massively understated in three major ways weighting, substitution and hedonic indexing. So we don't have to go into it now, but it's understated. Everyone would have to agree that the CPI is nothing more than the CP lie. It is a scam. It's understated. There are many reasons the government wants to understate that and make us believe inflation is lower than it really is. So let's just make the assumption that when they tell us the inflation rate is 3%, we're going to assume it's at a minimum 50% higher than what they tell us. That would bring it to 4.5%. And if we think it's worse than that, if we think it's maybe double, then we would be facing a real inflation rate of 6%.
