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Outrageous! – Artificial Deflation!

This, from John Mauldin:

.......It seems the US Bureau of Labor Statistics, in the CPI next week, will treat the subsidy received by those 800,000 car buyers who bought a car in the “Cash for Clunkers” program as if the price of a car fell by $4,500. Really? My tax dollars account for nothing?

This does several things. It will decrease the inflation used to adjust the GDP for this quarter. Not the end of the world, but annoying But what really matters is that the CPI is used to calculate Social Security increases and interest paid on TIPS.........

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Just wait for another year

Just wait for another year or two when the federal government starts auditing the people whom took advantage of cash for clunkers. Now that right there is change I can believe in....

Both ways

Don't tell that to the people who got the cash for clunkers only to discover that it will be counted as "income" on their taxes. So the gubment has it both ways. It's income when you get it, although you never got it, but it's not spending when you don't have it any more, although you spent it.

Practice your Double Think.

Ĵīɣȩ Ɖåđşŏń

"Fully half the quotations found on the internet are either mis-attributed, or outright fabrications." - Abraham Lincoln

It also makes the real GDP

It also makes the real GDP numbers that will get reported look better than they really were.