Much more since the numbers are cooked anyways. Car model N cost 10k, and car model N+1 costs 15k, if N+1 has 2 more airbags, one more gear, a keyless starter it will be counted way under 50% inflation, even though you pay 50% more.
Most of the average joe's money is spent on housing + food + energy these things are all way above the calculated """average""" inflation
They're not necessarily "cooked," (but they certainly can be). Inflation is genuinely hard to calculate since it's different for everyone, goods and services purchased drift over time, and as you mentioned, that exact good also changes over time. CPI (and others) are more useful in a MoM or YoY context. At 10 years, it's better viewed as best guess cost of typical living rather than an economic indicator comparing apples and oranges.
> housing
This is actually the hardest to get right because it's the largest, and 2/3 of Americans own homes, so part of their costs are fixed.
No it's cooked. For high tech items, they assume that improved technology means you are getting more for your money even if the price goes up, so they discount it. It's true that you get more for your money, but it ignores threshold effects, like you just can't buy an equivalent phone for $10 even if todays phone's are 200x better.
Then there's the "owner's equivalent rent" BS and this is 25% of CPI. It answers the question "If someone were to rent your home today, how much do you think it would rent for monthly, unfurnished, and without utilities?" It assumes rental price and housing costs are somehow linked when in reality asset prices have far outstripped rent.
> it assumes rental price and housing costs are somehow linked when in reality asset prices have far outstripped rent
It's pricing the cost of shelter. Renting a home is buying shelther. Buying a home is buying shelter and buying a financial asset. OER is the way you separate the last two components. Otherwise, you'd have to only look at rents to determine housing prices, which would be rubbish in a country where most households live in homes they own.
why should the asset prices matter in OER? the aim is understanding cost. BLS no longer questions homeowners but samples local rents to estimate OER since homeowners could've been wrong in their guess. of course, someone may have locked in a low interest rate so their expense is overstated. counterargument is that you are consuming a more valuable service by occupying the unit even though market rent exceeds your costs so it doesn't matter if your cost is assumed to be the market rent. note there is a 6-month sampling lag of rents, which doesn't help the perception gap in the inflation figures.