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What Role Does Government Play in Price Inflation?

by Michael Pettis, Financial Sense:

Let’s take a look at inflation from the standpoint of prices.

That viewpoint puts the cart before the horse (my definition of inflation pertains to an increase or decrease in money supply and credit, not an increase in prices). Nonetheless the results are significant.
Inflation Comparison – Select Components Since 1978.

Discussion of Starting Year

The above charts are from Doug Short at Advisor Perspectives. Doug creates excellent charts every month on various CPI components. Rather than reinvent the wheel, I asked Doug for a set of custom charts.

Specifically, I had asked Doug to go back to 1971 for both charts.

Unfortunately, data for components in the first chart only goes back to 1978, and in the second chart not even that far.

The reason I asked for a starting year of 1971 is that’s when I started college.

Tuition at the University of Illinois in Fall of 1971 was $250 a semester for engineers (My degree is in civil engineering). Current University of Illinois Tuition is $8,278 per semester for Illinois residents, $15,349 for non-residents.

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