The Consumer Price Index is a Lie

The following is an excerpt from an interview with Jim Rogers by Ron Hera.


HRN: You mentioned that the US is the largest debtor nation in the history of the world. Do you think that will lead to high inflation or hyperinflation in the US?

Jim Rogers: Well, there will be inflation. First, you have to have inflation before you can have hyperinflation. I mean, we have inflation now. If you go to the shop, whether it's groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don't: Australia, China, India and Norway. Many countries don't lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.

HRN: Are you saying that the American Consumer Price Index (CPI) published by the US Bureau of Labor Statistics is a lie?

Jim Rogers: In my opinion, yes, of course it is. Have you looked at it? They've changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn't count it, saying rents weren't going up, and then when home prices started going down, they counted it. It's the same with many things. It's staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it's not really going up because it's better gasoline, better quality, therefore you're getting more for your money. I mean, it's endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says. As I said, in other countries, they acknowledge that there's inflation. I don't know how there could be inflation in Australia and not in the US; how you can have inflation in Norway or India and not in the US, but the US says there's no inflation.

To read the entire inerview go to
http://www.lewrockwell.com/rogers-j/rogers-j99.1.html or click on the link below for Lew Rockwell


Jim Rogers' English language books include Investment Biker: On the Road with Jim Rogers (1994), Adventure Capitalist: The Ultimate Road Trip (2003), Hot Commodities: How Anyone Can Invest Profitably in the World's Best Market (2007), A Bull in China (2008), and A Gift to My Children: A Father's Lessons for Life and Investing (2009).

Logging Off Black Cherry

My buddy Vince is culling about 40 Black Cherry trees for us this week. The market is not optimal by any means but if Kevin II is going put up a yurt in the spring we needed to clear some out anyway.

Honoring Our Veterans

Here are a few images that I have taken in the past year in my other job as a photojournalist for the New York Army National Guard.

God Bless our Veterans!

New York State Is So Broke - Tyler Durden

New York State Is So Broke It Steals From Itself To Pay Off Unapproved Debt
Submitted by Tyler Durden on 10/29/2009 15:50 -0500




The surrealities of a "healthy" economy never end. The latest indication of the new banrkupt normal is New York State itself. A new report by NY state comptroller Thomas DiNapoli entitled "Highway Robbery: State's ailing road and bridges robbed; State siphoned money to pay for operations and debt service" tells you all you need to know about just how prosperous the ailing economy really is. According to DiNapoli, "only one-third of the money in the Highway and Bridge Trust Fund has actually been used to pay for highways and bridges. The rest has been siphoned off to pay for debt service on back-door borrowing and to fund operational costs for the DMV and the state Department of Transportation." Is that lack of stolen pocket change Mr. DiNapoli can believe in? Apparently not - Mr. DiNapoli's words: "I think outrage and anger is certainly appropriate; we need to channel that into thoughtful public policy." Yet anger is so September 2008. Welcome to the Xanax highs of the new credit bubble.

“This money should be going toward keeping our roads and bridges safe, not to fund state agency operations. The bridge closing in Crown Point is just one more example of why this is so important. If this trend continues, the state will have to transfer nearly $4 billion into the Trust Fund over the next five years. Using this dedicated capital money to pay for operations and debt service is just one more gimmick on the list of New York’s bad fiscal choices.”

Should one cry or laugh here? New York State is stealing from itself, and its own comptroller is bitching against this practice, seemingly powerless to do anything to prevent it in the first place. Perhaps the state's transportation trust fund should put all its stimulus money in CIT stock or whatever the HFT megavol stock de jour is and hope and pray. These days the market has odds that are just a little better than Craps (although the likelihood of being comped by your broker when the ponzi market loses all your money, are still slim to none).