[Winder]

I suppose your country has an official office for computing statistics. Help yourself and check the indices of price rate. If it is not too badly done, you can check this year, and many years in the past. In my country, they even provide you with long terms statistics.

I live in France... but let look for example US. They provide inflation rate month by month from 1914 to 2014:

Where do we have noticable deflation ?

- moderate deflation rates in 1921, 1922... after few year with huge inflation of prices.
- moderate deflation rate in 1927, 1928. 1929 is like a draw. Huge deflation rate following the crisis in 1930, 1931, 1932, 1933
- moderate deflation rate in 1938.
- moderate deflation rate in 1949 and no a full year with deflation since 1949.

There where economic crisis in 1921-1922 and I think I don't need to recall to your attention the 1929 economic crisis.

For me looking for both the inflation rate history on one side and the definition of inflation on the other side I conclude that there was a continuous sustained increase in the general price level of goods in the US since 1949... And overall even from 1914 if we take the average... Even through some year had deflation.

The Federal Reserve was chartered in 1913. The crash of 29 followed an inflationary bubble known as the "Roaring 20's". This is a post WWI bubble.
We have several war bubbles that distort data. You need to look at the history. 1947-1948 saw double digit inflation rates. The deflation you quoted in 1949 is a direct result of the central bank trying to combat the runaway inflation of post WWII.

So...I don't get you point? You want to deny the observed inflation rate? You want to deny many central bank have and objective to maintain a low but positive inflation rate ?

All all of the years you quote occur after we established a central bank.
Deflation that occurs as a result of a economic bubble is not good. Deflation that occurs as a result of natural economic growth is a good thing.

I mean there was some idea that prices decreased over time for most things... Still there proof it was not the case recently in the US... Was not the case in France neither.

Even through I'am engineer and with quite good salary I saw the price of meat incresing and buy less of it than before. I remember that 17 years one precise house was brought for 200 000€... Now it is estimated 600 000€. Still it is 17 years older. When I was youg a small new car was worth something like 1200€... Now it is 8000€. You'd say the new car is better blablabla... Mostly it is still a car, a little safer... but 6 time more expensive. Does it consume far less gazoline? No. Do we drive significantly faster? Well there lowered speed limit now. No real difference in service, 6 time the price. And where I live the toll to use the highway take 10 cent every years, price of restaurant tend to get easily 1 euro per year for a lunch...

In the USA food is not calculated into the inflation rate. Food is heavily subsidized here, so we pay much more for it than we would normally. There is an old saying in economics. IF you want to make something really expensive, subsidize it. This is why I said above to give me an example of a good that is not subsidized where prices are rising over time. The federal government does not include food, housing, or energy in the CPI (our inflation index) because all of those segments are heavily subsidized and the subsidies distort the numbers.

I still have not seen anyone explain how poor people are helped by rising prices. Everyone wants to use vague references and general statements. Let's start with the simple stuff. If you are poor and have limited income elasticity how are you helped by rising prices? How do rising food prices help poor people? If you believe inflation is good, then it should be simple to explain how rising prices help people.

[Nicolas06]

In the USA food is not calculated into the inflation rate. Food is heavily subsidized here, so we pay much more for it than we would normally. There is an old saying in economics. IF you want to make something really expensive, subsidize it. This is why I said above to give me an example of a good that is not subsidized where prices are rising over time. The federal government does not include food, housing, or energy in the CPI (our inflation index) because all of those segments are heavily subsidized and the subsidies distort the numbers.

I still have not seen anyone explain how poor people are helped by rising prices. Everyone wants to use vague references and general statements. Let's start with the simple stuff. If you are poor and have limited income elasticity how are you helped by rising prices? How do rising food prices help poor people? If you believe inflation is good, then it should be simple to explain how rising prices help people.

You miss the point, you melt what you think is good or not with what happen. That you don't like it doesn't prevent to happen. There still positive inflation rate. And that removing's from your own explanations subsidized thing that anyway see their price increasing over time as you explain. (like Food, housing or energy). The obvious conclusion is that price of things increase even more if we count everything.

Don't like? Think it is bad... That's another topic !

The Federal Reserve was chartered in 1913. The crash of 29 followed an inflationary bubble known as the "Roaring 20's". This is a post WWI bubble.
We have several war bubbles that distort data. You need to look at the history. 1947-1948 saw double digit inflation rates. The deflation you quoted in 1949 is a direct result of the central bank trying to combat the runaway inflation of post WWII.

No point to deny big key event like war do happen from time to time... I mean just listen to the news, there several wars going on just right now.

[Winder]

There still positive inflation rate.

Did I say there wasn't?

The obvious conclusion is that price of things increase even more if we count everything.

1. IF the central bank is pursuing an inflationary policy, then obviously prices rise with inflation. This is the result of monetary policy and not natural economic expansion or contraction.

2. To use sensors as an example. There was a shortage of really high quality silicon needed for imagining sensors. Low quality silicon results in lower yields. There were also manufacturing issues that required multiple masks to produce FF sensors. A few years ago a couple of new facilities for producing pure silicon came on line. This lead to a big drop in the price of raw materials needed to produce sensors and higher yields. This also lead to a big shake up in the American solar panel industry which some people might remember. At the same time Canon and Sony improved manufacturing techniques for FF sensors allowing the production of a FF sensor with a single mask. The result of these two natural economic evolutionary events is price deflation in the digital camera market. Today you can buy a FF digital camera for $1,200.00 and it doesn't have a damn thing to do with Moore's Law. 10 years ago I paid $3,000 for a 12MP Canon 5D. Falling prices are natural in a healthy economy. Technology is a good example because of the compressed time frame.


You still have not explained how inflationary policies help poor and middle class people. How do higher prices help people with little or no money? How do higher prices help people with limited income elasticity? The answer is that you can't, because inflationary policies make poor people poorer. That is why you are avoiding the question.

[Nicolas06]

Winder we have the same view. Don't got it yet?

Yes price increase overall. this is tracked by inflation rate. Food is more and more expensive. Housing or ernergy too. Poor or middle class struggle with that issue. Price do decrease for FF camera and plasma TV... Unfortunately you cannot eat FF camera or plasma TV. Thoses things account for a tiny bit of overall expenses and even then are just luxury toys for most, in no way are they necessary.

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Last edited by Nicolas06; 12-08-2014 at 01:47 PM.

[monochrome]

In the USA food is not calculated into the inflation rate. Food is heavily subsidized here, so we pay much more for it than we would normally. There is an old saying in economics. IF you want to make something really expensive, subsidize it.

When calculating the Consumer Price Index the Bureau of Labor Statistics assigns a weight of 14.9% to Food & Beverages. Since Food and Energy are highly volatile, BLS publishes another measure without them - CPI-ex Food and Energy.

Here's a link to the 2011 - 2012 BLS Weights (10/2013)I'm out with this one - getting overly political. Thread Ignored.

[reh321]

Price do decrease for FF camera and plasma TV.

I know I promised to refrain discussing this any more, but this seriously needs a refrain from what I already said; then I will keep my promise and say no more.

Most of the cost in these particular examples is electronics of some kind, which is why I made my comment about Moore's Law. Prices of TVs and cameras will continue to go down; prices of automobiles and houses will continue to go up ... and most of us spend a lot more on the latter (the stuff going up in price) than on the former (the stuff which benefits from Moore's Law)

[Winder]

Most of the cost in these particular examples is electronics of some kind, which is why I made my comment about Moore's Law. Prices of TVs and cameras will continue to go down; prices of automobiles and houses will continue to go up ... and most of us spend a lot more on the latter (the stuff going up in price) than on the former (the stuff which benefits from Moore's Law)

Do you understand that Moore's Law simply describes the rate of advancement of an industry? It's not a real law, and it doesn't change the laws of supply and demand.
As people become more productive they can produce more with less resources. Digital cameras have allowed people to be more efficient and produce more images at a lower cost. The result is people are paying less for images.

There is a rate of evolution in every industry. Moore's Law specifically applies to one industry, but doesn't change or define the economics of the industry. Yes, the tech industry is a rapidly evolving industry, but the speed of evolution doesn't change economics. If the industry evolves slowly, then prices fall slowly. If an industry evolves rapidly, then prices fall rapidly. This assumes constant demand.

Food is more and more expensive. Housing or ernergy too.

And all of these are subsidized and prices are distorted by government. Oil is currently falling... WHY? Because Saudi Arabia is driving down prices and selling a lot of oil at a low price? WHY? Because the Saudi's only need $10.00 a barrel to be profitable. The Gwar oil field produces more oil than the next 5 super fields combined. Russia needs $110.00 a barrel to be profitable and Iran needs $130.00 a barrel. The Saudi's don't use trade embargoes to put political pressure on other countries, they manipulate oil prices. Energy prices are highly manipulated by governments.

I don't know enough about the economy of France, but in the USA food is highly subsidized and we have import restricts on many goods that drive up prices. We pay twice as much for sugar as Mexico because we protect the American sugar industry. The Farm Bill is $1 trillion. Most of it subsidies and pork for corporate farms. We pay farmers not to produce. I'm sure if we look at France we will see mercantilism is alive and well. Subsidies, trade tariffs, you name it. All of these lead to higher prices and prevent prices from falling. They are not part of a healthy evolving economy.

Goods that are not manipulated by government fall in price as manufacturers become more efficient at production. We put a 20% tariff on solar panels to protect our solar panel industry, but that keeps prices from falling. The same events that have driven down the price of sensors have also driven down the price solar panels, but our government stepped in and prevented those prices from falling. American's pay 20% more for solar panels than people in other countries so that an extremely small but politically connected industry can get rich.

Prices fall in a healthy economy as producers become more efficient. Competition drives efficiency. What is happening in the photography industry? Are prices rising or falling? Photography is nearly a totally free industry. There are no barriers to entry (regulation). There are no cartels or unions setting prices. Free markets drive down prices. Photography is free industry and the downward trending prices reflect this.

If you think real prices rise naturally over time then photographers real wages should be rising over time. They aren't. The industry is not regulated or subsidized and those are the two primary reasons you see rising prices in an economy. If the government required all professional photographers to have a Masters of Fine Arts degrees or medium format cameras, you would see rising prices and fewer professional photographers because the barrier of entry would be raised. You would have regulation. You would also see the cost of tuition rise for the degree and the medium format industry would be much larger.

Let's keep it specific to the industry. Explain why prices (wages) are not naturally rising for professional photographers over time?

[reh321]

Do you understand that Moore's Law simply describes the rate of advancement of an industry? It's not a real law, and it doesn't change the laws of supply and demand.

I am a computer professional. I understand Moore's Law. I used it correctly. I applied it to the specific things you talked about, namely modern TV sets and cameras, both of which are parts of the electronics industry, which is the industry that Moore's Law applies to.

You may continue to talk. I'm going back to discussions on photography, which is why I am here.

Have a good day.

[Uluru]

This thread has become increasingly tedious and off topic.
It needs to be closed.

[Winder]

I am a computer professional. I understand Moore's Law. I used it correctly. I applied it to the specific things you talked about, namely modern TV sets and cameras, both of which are parts of the electronics industry, which is the industry that Moore's Law applies to.

You may continue to talk. I'm going back to discussions on photography, which is why I am here.

Have a good day.

I'm sure you are a computer professional. My background in economics. Moore's "law" describes the speed at which an industry advances, and it is not a law. All industry advance. Some slower than others. Some are stagnate for years, decades or centuries. Agriculture has had long periods of no advancement followed by periods of rapid growth, but the economics of the goods produced don't change just because the rate of advancement changes.

As people become better (more productive) at producing a given good, the price of that good falls. It does not matter if we are talking about integrated circuits or socks. The same rules apply.

[jeff knight]

Ooby-dooby

[Nicolas06]

If you think real prices rise naturally over time then photographers real wages should be rising over time.

Predictions are for 0.6% increase over the next 5 years for the sector.

[nestacurta]

Where is the rumor about K-1, or perhaps K-0, a never come FF.

[Mikesul]

This thread has become increasingly tedious and off topic.
It needs to be closed.

+ 1. If not closed at least moved to the off topic section. There has been little or nothing related to the title for a great many messages.

[Winder]

Predictions are for 0.6% increase over the next 5 years for the sector.

Which is less than the rate of inflation, so real wages are falling for photographers.

Anyway. We are causing emotional distress from some of the readers and are off topic.