It is, but what this says is that even accounting for the diminishing buying power of the dollar, the price of electricity is rising and it can’t be accounted for just due to inflation itself.
The diminishing buying power of the dollar is subjective, relative to the commodity being bought. Inflation is an average over a set of commodities. There is inherent value of the dollar that can up or down. The diminishing buying power of the dollar IS the rising price of electricity (if you’re buying electricity) and the rising buying of the dollar is the diminishing price of the Libyan Dinar (if you’re buying land in Libya).
To say the price of electricity is increasing even accounting for the diminishing value of the dollar makes no sense because the diminish value of the dollar is a relative measure and the way it’s measured IS by looking the price of the thing being bought
But that’s not the only thing it measures, if it did it would be an entirely useless abstraction. I don’t get how the complaint makes any sense, it’s a very standard shorthand for “this thing is rising in price in ways that can’t be accounted for by the shrinking overall value of the dollar when measured against the price of all commodities in the domestic market”.
The buying power of the dollar being relative to what commodity it is buying is exactly why overall inflation is a useful measure to be compared against. It isn’t the most relevant measure, but it’s a good summation to the layman that something else is going on.
No, not really. Let’s take another example. Let’s say the average building height in NYC is increasing year over year. Some buildings are going to be higher than that average. You wouldn’t say this building is higher than could be explained by the increase in average height because the increase in average height is NOT an explanation.
The decreasing value of the dollar is not an explanation causing price increases. Price increases IS the decreasing value of the dollar. The price of some commodities increasing faster than other commodities is exactly what we would expect during inflationary periods.
It’s not like there’s some number that is “the value of the dollar” and it changes in an objective way that businesses need to adapt to by raising prices. The value of the dollar is literally defined by the prices of things.
Now that is a useless analogy. Buildings aren’t abstract constructions that fluctuate up and down based on complex relationships of military power projection, debt and demand.
The fact that inflation is the sum of all these price increases isn’t a profound discovery, and neither is that some things get pricier outpacing inflation, literally everyone understands that. That’s why it’s an average. That doesn’t mean it’s dumb or redundant to point it out, and pointing out that this is a thing that always happens reads like a hunting for an ummm akchually. This is just an exercise in microscopic hair splitting.
I really disagree. There’s no objective thing called inflation. There is no single quantity called the “value of the dollar”. The price of electricity going up is not caused by inflation. The price of electricity going up IS inflation. You can’t say that the price of electricity is going up “even when accounting for inflation” because the price of electricity going up IS inflation.
What you could say is that the price of the inputs to the price of electricity are going up at a slower rate than the price of electricity itself. That’s an interesting thing to say. But the state of affairs described by that could happen even if deflation was happening in the economy.
Here, let me try another way. The definition of inflation is:
the general increase in prices of goods and services in an economy over a period of time
Do you see why your statement:
even accounting for the diminishing buying power of the dollar, the price of electricity is rising and it can’t be accounted for just due to inflation itself
Doesn’t make any sense? I’ll rewrite your words:
Even accounting for [prices going up], the price of electricity is [going up] and it can’t be accounted for just due to [prices going up]
Inflation is a weird thing to measure against, considering the price of electricity should be… included in inflation.
It’s another way of saying that electricity costs are rising faster than other costs
It is, but what this says is that even accounting for the diminishing buying power of the dollar, the price of electricity is rising and it can’t be accounted for just due to inflation itself.
The diminishing buying power of the dollar is subjective, relative to the commodity being bought. Inflation is an average over a set of commodities. There is inherent value of the dollar that can up or down. The diminishing buying power of the dollar IS the rising price of electricity (if you’re buying electricity) and the rising buying of the dollar is the diminishing price of the Libyan Dinar (if you’re buying land in Libya).
To say the price of electricity is increasing even accounting for the diminishing value of the dollar makes no sense because the diminish value of the dollar is a relative measure and the way it’s measured IS by looking the price of the thing being bought
But that’s not the only thing it measures, if it did it would be an entirely useless abstraction. I don’t get how the complaint makes any sense, it’s a very standard shorthand for “this thing is rising in price in ways that can’t be accounted for by the shrinking overall value of the dollar when measured against the price of all commodities in the domestic market”.
The buying power of the dollar being relative to what commodity it is buying is exactly why overall inflation is a useful measure to be compared against. It isn’t the most relevant measure, but it’s a good summation to the layman that something else is going on.
No, not really. Let’s take another example. Let’s say the average building height in NYC is increasing year over year. Some buildings are going to be higher than that average. You wouldn’t say this building is higher than could be explained by the increase in average height because the increase in average height is NOT an explanation.
The decreasing value of the dollar is not an explanation causing price increases. Price increases IS the decreasing value of the dollar. The price of some commodities increasing faster than other commodities is exactly what we would expect during inflationary periods.
It’s not like there’s some number that is “the value of the dollar” and it changes in an objective way that businesses need to adapt to by raising prices. The value of the dollar is literally defined by the prices of things.
Now that is a useless analogy. Buildings aren’t abstract constructions that fluctuate up and down based on complex relationships of military power projection, debt and demand.
The fact that inflation is the sum of all these price increases isn’t a profound discovery, and neither is that some things get pricier outpacing inflation, literally everyone understands that. That’s why it’s an average. That doesn’t mean it’s dumb or redundant to point it out, and pointing out that this is a thing that always happens reads like a hunting for an ummm akchually. This is just an exercise in microscopic hair splitting.
I really disagree. There’s no objective thing called inflation. There is no single quantity called the “value of the dollar”. The price of electricity going up is not caused by inflation. The price of electricity going up IS inflation. You can’t say that the price of electricity is going up “even when accounting for inflation” because the price of electricity going up IS inflation.
What you could say is that the price of the inputs to the price of electricity are going up at a slower rate than the price of electricity itself. That’s an interesting thing to say. But the state of affairs described by that could happen even if deflation was happening in the economy.
Here, let me try another way. The definition of inflation is:
Do you see why your statement:
Doesn’t make any sense? I’ll rewrite your words: