Real GDP has shrunk by more than 50% since 2001!Submitted by fsk on Tue, 03/17/2009 - 13:15
Via Google Analytics, I noticed a lot of people citing my blog here recently. It's been directing a lot of traffic.
Here's another article you might be interested in.
The CPI is a biased measure of inflation. The CPI severely understates the true inflation rate.
If you use M2 as your GDP deflator instead of the CPI, then GDP has been shrinking at an average rate of more than 1% per year over the last 10 years. I can't repeat the calculation with M3, because the Federal Reserve no longer publishes M3. If you use gold as your GDP deflator instead of the CPI, then GDP has been shrinking at a rate of more than 8% per year over the last 10 years.
If you believe "Gold is money!", then the FRN-denominated price of gold is a relatively unbiased measure of inflation over a 10+ year period.
(I would include a graph, but this forum doesn't allow you to include images.)
Read the article for full details.