Today’s show is sponsored by The Cost Segregation Guys. If you own investment real estate and haven’t looked seriously at cost segregation, you could be leaving significant tax savings on the table. The Cost Segregation Guys help investors accelerate depreciation, improve near-term cash flow, and make more efficient use of capital, all without changing the underlying asset. In a business where preserving cash matters, that’s worth paying attention to. If you’re interested in learning more, click on the link in the show notes and you’ll be able to connect with them directly, and qualify for a discount because you came from the show.

https://costsegregationguys.com/estateespressopodcast/

------------

We’re talking about proposed changes to how inflation is calculated, and what that could mean under a new Fed Chairman, Kevin Warsh.

Now, before we get into the implications, let’s start with a simple premise. If you change how you measure something… you change the outcome. And if you change the outcome… you change the decisions that follow. That’s exactly what’s at stake here.

The Fed pays attention to the Core Personal Consumptions Expenditures index (Core PCE). But both of these measures have… let’s call them limitations.

They rely heavily on statistical adjustments. Hedonic adjustments. Substitution effects. Owner’s equivalent rent.

These are not trivial details. These are structural assumptions baked into the data.

For example, if steak becomes too expensive and consumers switch to chicken, the index assumes that substitution and dampens the measured inflation.

But here’s the problem. From a lived experience standpoint, people don’t feel like inflation has gone down. They feel like their standard of living has declined.

That disconnect between reported inflation and experienced inflation is one of the biggest credibility challenges facing central banks today.

And that’s where someone like Kevin Warsh could represent a shift. If a Warsh-led Fed were to move toward a more “common sense” measure of inflation—less adjusted, less modeled, more observable—you could end up with systematically higher reported inflation.

------------

**Real Estate Espresso Podcast:**
Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)
iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)
Website: [www.victorjm.com](http://www.victorjm.com)
LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)
YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)
Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)
Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)
**Y Street Capital:**
Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)
Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)
Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)