acreage1, well there's inflation that lifts the measured price of commodities. That is core and non core. It is widely felt that often the 'choice' of commodity inclusion into the inflationary figure is politically selective.
The figures can be fudged.
But the problem with China's figures is that they are sieved through the political process and are open to immense distortion.
They also don't take into account the massive inflation relating to assets, power blackouts, food prices, accommodation costs and other seemingly unrelated costs that are increasing and putting up the cost of living over the 'official rate'.
Also the government is trying to bury the mammoth bad debt balloon caused by the local governments spending spree. So we could be looking at between $450 billion to $1 trillion pumped into the economy. That by itself will cause pressure on inflation and for virtually no gain.
From my reading the true inflation rate may be more like 10% with loads of upward pressure.
Now to confuse things there's talk of interest rates and bank reserve ratios being relaxed soon. We'll see if that really happens.
Another way to view inflation is to look at wage increases. The Chinese government is forced to grant substantial increases to stop rioting.
Social unrest is poison to the regime. That creates instability and a totalitarian government must have total, absolute control.
While most of the world has inflation so will China and the official rate is so full of holes it's like Swiss cheese.
