Source: Huitong Finance
The meaning of the word "inflation" occursfishinfrenzyfreeplaychanges. It used to mean price increasesfishinfrenzyfreeplayNow it means high prices.
Academics, economists and style guide editors may not like it, but if you want to understand what people mean when they complain about inflation, you need to understand how vernacular has evolved over the past few years.
At least according to official measures from the U.S. Bureau of Labor Statistics, inflation has fallen sharply from a peak of 9% in mid-2022 and is currently at 3.5%.fishinfrenzyfreeplay.4%, roughly in line with the quarter-century level from 1983 to 2008.
The overall measure of inflation is based on something quite arbitrary, which is exactly the price level of a year ago. A more prominent time frame, especially in an election year, may be changes in prices since the epidemic or Biden took office. From a young age, a more intuitive concept of inflation is simply "whether I pay a higher price for something than before."
By definition, inflation can be high even if prices fall. Literally, this should be impossible, that is, prices that are deflationary cannot also be expanding. But in daily use, it is entirely possible that $4 for eggs or gasoline is a sign of inflation, even if they used to be $4.fishinfrenzyfreeplay.50 dollars.
Figure: Changes in CPI understood by ordinary people (blue line: cumulative changes since Biden took office) and economists (red line: year-on-year change)(monthly data from January 2021 to April 2024)
The dictionary division (descriptionists and normalists) has become a key driving force in the 2024 presidential campaign. Voters who believe inflation is high may blame Biden and are unlikely to vote for him. When Biden administration staff retort that inflation is not high, they risk being seen as out of touch.
Nowadays, if you read or hear something about inflation in mainstream discourse, then either "inflation" is used to mean "high prices", or there is an implicit or explicit "actually" somewhere, you will feel like you are being lectured.
Prices are high, so inflation is high. Just get used to it.