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zima,

"Maybe, maybe not?..."

Regarding inflation: Some prices have gone up. Others have gone down. There is a lot of wiggle room depending on how one chooses to define the CPI. The CPI is supposed to measure the price for maintaining a fixed quality of life, but the fed's been under pressure to manipulate the index for external purposes, which Alan Greenspan notoriously did during his reign over the fed. Here's a link for anyone who's actually interested.

http://www.shadowstats.com/article/consumer_price_index


Your link was from 1996, which is kind of ancient, I'm not sure how relevant it is today. Food prices have spiralled up, housing prices (even after the crash) are unaffordable, cars, gasoline, etc.

I read in the newspaper that our local food prices are up 30% over a two year period. I had already stopped buying things I used to enjoy due to price increases.

http://www.wnd.com/2008/03/59409/


"Either way, possibly an important factor is what kind of houses people want and/or expect - and they're a bit different than in the past"

That's true, but even so I think today's middle class is financially worse off than yesterday's middle class.

Economics in general is about manipulating indexes rather than providing anything meaningful. You can see it in some of the commenters on this website, quoting market caps and P/E ratios, thinking they're intelligent, but not realizing that what they're doing is just choosing the numbers than haven't failed miserably yet and then come up with all kinds of bogus reasons just to keep their own anxieties in check.

The link is from 1996, but its general premise still very much holds - people often have the tendency to look at the past through rose-tinted glasses, that's one of major biases of our memory. Meanwhile, we often get much better bang-for-buck.

BTW, you have rather low car and petrol prices, anyway... And personal anecdote WRT food prices: at least 1.5 year ago they also seemed distinctly lower than in a fairly typical recent EU member state (so a more impoverished place, with much lower wages) - and that in coastal Florida, so also likely not the cheapest of US places.
So, maybe another factor: you're simply starting to feel the more "real" costs of living on this planet (maybe boiling down to http://en.wikipedia.org/wiki/File:Human_welfare_and_ecological_foot... ), free lunch nearly over.

Edited 2012-11-24 10:08 UTC