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Here is What the Inflation Numbers Really Mean
Understanding the inflation (CPI) numbers using a simple math trick with real world examples.
There are plenty of articles in the financial news media reporting on inflation, and sadly they all share the same traits:
- Report the data and expect the reader to know what it means.
- Drawing conclusions and telling the reader who to blame.
- Printing vague definitions using the most convoluted financial language that only an Econ101 professor would enjoy.
In general, none of the media outlets are willing to describe to readers — in simple terms — what the current inflation numbers mean to their day-to-day life and finances. So I will.
By sharing a math trick I picked up along the way, I want to make the complicated — simple.
This math exercise will help you simultaneously calculate compounding interest rates and develop a sense of when consumer prices will double, triple, quadruple, etc. Don’t worry it’s super easy to do, and I’ll share plenty of examples.
Afterward, I will spotlight a chart that shows just how bad the current inflation situation is compared to previous years. This visualization gives context to the growing crisis and…