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Hey everybody, this is Phil Town.

And this is Danielle Town.

Welcome to the invested podcast where we are, hmmm, basically learning what Warren Buffett would have done in the 1970s.

To go from $60 million to $600 million as a rule, as a rule one investor, somebody that focuses on don't lose money.

How can you focus on not losing money and end up making $60 million turn into $600 million in about eight years? How do you do that?

That's what we're going to talk about.

I hope we get to that today.

Let's first finish what we were talking about before, which was how is this world of potentially higher and higher and higher inflation going to shake out with interest rates and with the market?

Okay, right on. So let's dive in.

So think about how the Federal Reserve has decided to calculate inflation.

Back, this has been a relatively quick process, but if we go back to where they didn't mess with it, basically calculated inflation was a matter of taking a basket of goods and services that represented the economy and big basket of stuff.

And compare the prices of that and one time period to the prices in another time period you could compare it annually, let's say.

All right, seems pretty logical, right? Here you got a pile of stuff.

Here's a basket of chicken and ribeye steaks and a computer and rent, right, like that gasoline.

Yes. And you compare that to what people pay for those same items a year later.

And that's your inflation rate. That's that's called the cost, let's say a cost of goods index, essentially.

What do goods cost? And if they cost more, there's inflation pretty straightforward.

Well, they decided that that is for one reason or another, not the best way to do it.

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