Inflation mystery. An Aha! moment for me.

[kandrathe]

So, this is going to be real hyperinflation (aka overwhelming poverty) rather than nominal? That's a scary thought. While things will no doubt get more expensive, I don't think I believe that. I'm pretty sure Americans will be at least roughly as productive tomorrow as today, at bare-bones minimum.

Yes, and no. The ones remaining in the work force may be as productive, however the individuals skills gap in credentials needed versus those available is increasing. In other words, we need more highly skilled workers, and we're producing fewer of them. Also, those retiring take their experience with them, and so we experience a natural brain drain in one sense, but perhaps it is offset by youthful exuberance in another. Still, I'd rather have 3 experts with experience than 10 rookies who need additional hand holding, and training.

What was the "aha" realization?

Just the idea of separating local inflation (expressed in runaway health care, education, and other services costs) from global inflation which dominates the CPI at ~3%.

Afterthought: I do love this - "I tend to think about demand as air pressure inside a closed box. At some point, the box responds and adds a new major, or program." I'd say air-filled boxes don't usually determine policy at universities, but given some of the decisions I've seen, maybe you're on to something.

Well, yes, it was an intuitive leap. But, at universities, the buildings tend to be big boxes filled with process, and product. The bigger you get, the more boxes you need.