There was a time not so long ago when I’d discuss the likelihood of low inflation and the old food and gas argument would get thrown in my face. That argument basically went like this:
“You can’t eat core CPI! The BLS manipulates CPI data and the Fed prefers to strip out food and gas because it makes inflation appear lower than it really is.”
This never made much sense to begin with and that argument has officially stopped working in recent years as global food prices have deflated and gas prices are now deflating.
(Year over year change in food prices via GAO)
(Year over year change in US regular formations gasoline price)
Of course, this hasn’t altered the thinking of the people who predicted hyperinflation and high inflation over the course of the last 5 years. In fact, it’s provided them with more fodder to argue that the economy is weak and that the policies they said would cause hyperinflation, actually didn’t do anything helpful. Heads they win, tails they win. That’s the beauty of being someone who sells fear for a living. Even when the facts prove you wrong you can still sell fear to people by manipulating your message however you like. It all just adds to the ideological dishonesty of so much of the debate that swirls in economic and political circles.