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Episode 040: Dr. Ed Yardeni, host Rick Ferri

Bogleheads On Investing Podcast

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The Problems of Measuring Income

Just using a minimum wage, for example, is not a great way to measure income. I know a lot of people who are multi millionaires, who are getting affordable cara tax credits because their income is low. And the government says, if you have low income, then youare in poverty or some level of poverty - even though it doesn't measure wealth. So that's one problem. The c p i tends to be upwardly biassed. It's widely recognized by economists that it's upwardly biased. There are other measures that economists, particularly te feds, endorse, the personal consumption expenditure to deflater ass an alternative to the c p i.

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