"I know, there are lots of complications to this argument, lots of caveats and lots of footnotes. But the bottom line is that to correctly account for the impact of housing prices on my well-being you would have to take account of depreciation and taxes and maintenance and capital gains and expected capital gains. Too complicated. You can't leave housing out of the index. That would make the index meaningless. But the index as currently estimated is a poor measure for deflating my salary and particularly poor when housing prices and rental rates are rising steadily."The numbers may be "broken." Perhaps there is another possibility. Perhaps such numbers can't tell us much that is worthwhile and accurate in general. It certainty seems that the numbers cannot tell us the things many people are saying the numbers tell us.
Thursday, September 15, 2005