Fed funds rate - CPI = real rate
Using current numbers: 4.75% - 6.4% = -1.65%
Put your money in a savings account with a 4.75% APY, you're still losing to inflation at a rate of 1.65%.
If real rates aren't positive, then central banks frankly aren't even trying to bring inflation down. Despite the """""aggressive""""" rate hikes from the Fed, bonds are still dogshit and people are still borrowing money to buy things while they're still cheap before inflation jacks up the price, which only perpetuates more inflation.
Also realize they routinely rejigger the CPI formula so the government doesn't look bad. The calculation above was using "official" numbers; the real inflation numbers are worse, easily double the CPlie.
Fed funds rate - CPI = real rate
Using current numbers: 4.75% - 6.4% = -1.65%
Put your money in a savings account with a 4.75% APY, you're still losing to inflation at a rate of 1.65%.
If real rates aren't positive, then central banks frankly aren't even trying to bring inflation down. Despite the """""aggressive""""" rate hikes from the Fed, bonds are still dogshit and people are still borrowing money to buy things while they're still cheap before inflation jacks up the price, which only perpetuates more inflation.
Also realize they routinely rejigger the CPI formula so the government doesn't look bad. The calculation above was using "official" numbers; the real inflation numbers are worse, easily double the CPlie.