The key to this is to stick to what we know for sure about inflation, and push theoretical debates to a future text. I can then look at the theory without worrying about the explaining the basics, as they will have already appeared.
I could change my mind about the order of publication, but my plan is to fill out the manuscript sections in a somewhat random order across a couple of books. I will switch to full time work on one text once it is ready for the final publication push.
What Do We Know About Inflation?
If we ask the question "What do we know for sure about inflation?", my initial reaction was to believe that there would not be much to discuss, given the complexity of the topic. However, given the disinformation that has been vomited all over the internet about inflation in the past decades, there is a certain amount of common beliefs about inflation that are completely and hilariously wrong. Debunking them gives the book a bit of an interesting hook, although I will include some straightforward explanation of historical trends, and patterns of behaviour within the data.
Anyone familiar with my writings might be shocked at the editorial stance within the book: I am going to be mainly quoting "mainstream" sources, and not questioning what academics have to say! Do not worry, I have not been taken hostage and trying to hide a plea for help in my drafts. If you are an inflation trader, you need to trade the index that the bonds are priced off of, and that index is the CPI (or equivalent, depending upon the jurisdiction). The indexation factor determines your profit or loss, not what you think the index should be. The bulk of the relevant research was produced by mainstream economists, many working at national statistical agencies.
- Basics: what are the types of price indices in use, and what do their histories look like?
- Inflation myths and misunderstandings. Basically, what you see posted online by hard money bugs.
- CPI versus the "cost of living." I see a lot of complaints about this.
- Inflation and Money. (More hard money stuff.)
- Asset (mainly House) Price and Inflation. Another major source of complaints. Why are house prices not in the CPI?
- Hyperinflation. It comes up too often in discussion to ignore. However, goes off into theory too quickly, and I have zero interest in reading the literature on Weimar.
- Methodology and controversies. (More on this below.)
- Inflation hedging (short, maybe point reader to Breakeven Inflation Analysis.
When looking around, I realised to my horror that Shadowstats is the most difficult topic to deal with. I am aiming at a general audience, and it is a safe bet that a significant portion of my readers will be familiar with Shadowstats, or its inflation-truther offspring.
The standard reaction has been so far to largely ignore Shadowstats, on the basis that it is crank theory. However, the website is going strong, while the various criticisms of Shadowstats on blogs are starting to disappear. I was only able to find one reference to the topic in journals. It was by people affiliated with the BLS, and let's face it, the reaction is going to be: "well, they would say that, wouldn't they?"
From my perspective, this might be the section of the book that could catch the most interest, but it is also as attractive as juggling live hand grenades.
I am in the awkward position of hoping an economics Ph.D. is going to step up and deal with this problem before I have to write that section of the book.
If I avoid scope creep, I could get the bulk of the first draft done in a few months. I would then iterate, cleaning up the text after letting the manuscript rest for awhile. This means that I will have started working on later projects before the publication of the inflation book. This means that the delivery timeline would still end up near my pace of one book per year.
(c) Brian Romanchuk 2021