Morning Must-Read: Danny Vinik: Peter Schiff: My Inflation Prediction Was Correct. The Stats Are Lying
...about America's economic struggles. In 2009, Schiff not only warned of impending inflation but said it was already upon us.... In the newest issue of Reason, the libertarian magazine, he ‘responds’ to his critics....'It's hard to ignore the victory chants coming from the White House press room, the minutes of the Federal Reserve's Open Markets Committee, the talking heads on financial television, and the editorial pages of The New York Times.... Their claims of victory are premature and inaccurate. Inflation is easy to see in our current economy, if you make a genuine attempt to measure it.' Schiff goes on to cite the Big Mac index... argues that the ‘sandwich, which reflects the average person's direct experience, may be a more accurate yardstick of inflation.’ This is wrong in so many ways.... If Schiff wants a metric that takes into account prices of everyday items—lettuce, tomato, bread, ground beef, etc.—he should look no further than the consumer price index.... The Massachusetts Institute of Technology has created a separate inflation measure: The Billion Prices Project tracks prices online through massive retailers that have significant market share. The project only further confirms the accuracy of the CPI. It’s hard to think of any theory that has been more clearly disproven over the past six years than the right wing’s inflation paranoia. But the fanatics are not giving up. Is there any evidence at all that would convince Schiff—and his many followers—he’s wrong?