We're rebranding the Consumer Price Index (CPI)
'Consumer Price Index' (CPI) is a very dry, very boring term.
But it's also an important metric in today's economy.
(It pretty much represents 'the cost of stuff,' and tracks whether or not our daily lives are getting more expensive).
So we've decided to give 'CPI' a rebrand, and make it as interesting as it is important.
We're calling it the 'Cost Of Kyle,' or 'the COK index,' for short.
It goes like this:
If Kyle chugs a Monster Energy Drink, punches a whole in his step father's dry-wall, then depletes the gas tank on his dirt bike, by doing donuts on the front lawn...
What is the Cost Of Kyle, and how does the price fluctuate?
If in January 2022, it cost $2.28 for a can of Monster, $14.98 for a sheet of dry wall, $6.48 for 8oz of paint, and $5.52 for a full tank of fuel (1.6 gal)...
The COK would have been $29.26.
Now, let's say the Cost Of Kyle today (January 2023) has reached a total $31.33.
That means the COK is inflating at 7.1% per year. Which has a knock on effect:
Too much COK inflation and the Federal Reserve will increase interest rates.
Making everyone's loan and credit repayments more expensive (the aim being to slow consumer spending).
Which (hopefully) then inspires companies to lower their prices, and meet everyone's lowered disposable income.
The opposite is also true (lower inflation typically leads to lower rate hikes).
And lower rate hikes usually means less money spent on loan repayments, and more money put into the markets.
So what does this have to do with crypto?
Right now, the COK inflation numbers are being calculated...
If, on Jan 12, they're shown to be below 7% year-over-year, some traders are expecting a jump in Bitcoin's price (from $16.9K to ~$19K).
And when BTC jumps, everything else in the crypto space tends to follow.
(P.S. Mom, our intern, Kevin, wrote this one. Don't @ us).
