Hey Brad, very sharp point. There is a strong argument that increases in the quality of good and services also bias the estimation of inflation. We address these relatively thoroughly in our white paper on CPI construction (http://www.unisonim.com/wp-content/uploads/2018/02/measuring-inflation-…). However, we make the case that items such as energy and housing have such a large loading on the computation that their respective biases emerge dominant. Check out the paper and let me know if you agree. Would love to chat about this further.

As for this article, I wanted to single out and shine light on the housing component because (1) it is the largest component of inflation and (2) I believe the removal of home prices from the inflation calculation has caused serious home affordability problems in the US (by mismatching inflation-linked wages and home prices).