📉 The CPI Illusion: How the State Redefines Reality
What if everything you thought you knew about inflation was wrong? The Consumer Price Index (CPI)—used by governments to track inflation—isn’t just flawed. It’s designed to deceive.
Let’s break down why the CPI isn't a faithful representation of your cost of living, and how it benefits the state while silently eroding your purchasing power.
🧨 Inflation Is Not Rising Prices
Here’s the first lie: Inflation is not a general rise in prices. That’s merely the symptom. The real cause?
Inflation is the expansion of the money supply.
When governments or central banks inject more currency into the economy, they dilute the value of every unit already in circulation. This monetary expansion leads to price distortions across the board—but those distortions aren’t evenly distributed.
The CPI, however, focuses on average prices, ignoring the source of the change. It doesn’t tell you why things are getting more expensive—just that they are (or aren’t), based on a conveniently curated basket of goods.
🏘️ The Housing Scam: Why Homes Are Excluded
Now for one of the biggest tricks in the book: Housing.
Despite being the largest expense for most people, housing is excluded from the CPI on the basis that it's an "investment," not a consumption good.
But let’s be honest:
If you live in it, pay for repairs, property taxes, insurance, and maintenance, it’s consumption—not an investment.
Most people don't flip homes like stocks. They live in them. Houses wear down, need upgrades, and depreciate without constant upkeep. That sounds a lot more like a consuming asset than a productive one.
So why exclude it? Because including the real cost of housing would expose the true scale of inflation.
📱 Why Most Consumer Goods Should Be Getting Cheaper
Here's another trick: Many goods naturally deflate in price due to innovation, automation, and economies of scale.
Think about:
- 🍅 Agricultural products
- 📱 Electronics
- 🚗 Automobiles
These products become cheaper to produce over time, especially in a free market. Technology scales. Efficiency grows. Prices, in a healthy system, should drop.
But when the money supply expands at a faster rate than production efficiencies, the nominal price stays flat or rises—even though the real value should be falling.
And the CPI uses that to argue: “Look, inflation is low!”
When in truth, you’re paying more for things that should cost less.
🏛️ Why the State Likes the CPI
The CPI isn’t just wrong—it’s politically convenient.
- 🧾 Wages and pensions are indexed to CPI. Understate inflation, and the government saves money.
- 📈 Central banks use CPI to justify low interest rates, which benefit debtors (like the state).
- 🗳️ Politicians can claim economic success while the public struggles to afford essentials.
All while your purchasing power quietly shrinks.
🧠 Rethink Inflation: It's Not Just Numbers
If you want to understand your economic reality, forget the CPI. Instead, ask:
- How much more currency is being created each year?
- Why are assets like homes and stocks inflating while your salary isn’t?
- Who benefits when inflation is underreported?
The truth is clear:
The CPI doesn’t measure inflation. It hides it.
It’s time we stop measuring price increases and start questioning why prices rise—and who’s pulling the levers behind the curtain.
