Posted by Leonard Steinberg on December 4th, 2012

Our beloved Government claims that the US inflation rate is currently somewhere around 2.25%…..remarkably they do not include the cost of housing in this figure, probably the single most expensive line item cost in every American’s budget. As we all know the cost of housing is rising dramatically, especially in New York.

In economics,  inflation is a rise in the general level of prices of goods and services in an economy over a period of time.  When the general price level rises, each unit of currency buys fewer goods and services. Consequently, inflation also reflects an erosion in the purchasing power of money – a loss of real value in the internal medium of exchange and unit of account in the economy.  A chief measure of price inflation is the inflation rate,  the annualized percentage change in a general price index (normally the Consumer Price Index) over time. So if you exclude housing from all of this, INFLATION is really not being measured valuably.

I would suspect the inflation rate in Manhattan is somewhere around 7-8%, based on the rental hikes, insurance cost hikes, rising staffing costs,  raised MTA fares, raised cabfares, food , etc: I guess we will never know since the government has chosen to exclude the largest single cost to us all…..the cost to keep a roof over our heads.