The Abundance Gap: tech savings, minus inflation.

Three numbers, in order:

• Technology in the Deflation Index: −99.97% since 1990.
• M2 money supply: +576% since 1990.
• CPI: +150% since 1990.

The arithmetic is the story. If the things technology makes are three thousand times cheaper, and there are nearly seven dollars in circulation for every one there used to be, and yet the prices ordinary people pay only rose 150% — the gap has to live somewhere. It does. We just don't see it on the headline.

The Abundance Gap, defined

We use a simple framing on this site: the Abundance Gap is the difference between how cheap technology made things and how expensive everything else got. By 2025 that gap was about 526 percentage points.

That number is mechanical. It's not inflation-adjusted, not opinion, not vibes. It's the spread between real, measurable lines on a chart that all started at 100 in 1990. One fell to 0.03. Another rose to 676. Five hundred points of separation is the headroom that should have shown up as cheaper goods, lower prices, more income left over at the end of the month.

Some of it did. Most of it didn't.

Where the abundance went

The honest answer is that the gap absorbed in three uneven ways.

1. The prices that didn't fall. Housing rose 350% since 1990. Healthcare nearly 300%. College tuition over 1,300%. These are not in the Deflation Index, by design — they aren't technology-mediated commodities. But they are where most household spending goes. Money that should have stretched further on rent and care got captured by sectors that didn't get cheaper, often because supply is constrained by zoning, regulation, or licensure rather than by manufacturing capacity.

2. Asset prices. The S&P 500 returned roughly 1,200% (price only) from 1990 to 2024. Existing homes became investment vehicles. The wealthiest decile captured most of the appreciation. When money expands faster than the goods sector demands it, it accumulates in things that look more like ownership claims than consumption — equities, real estate, collectibles. CPI doesn't see this. M2 does.

3. The sectors that did get cheaper, but you didn't notice. Streaming costs less than cable did. A single laptop today outperforms a 1990 supercomputing center for the price of a week's groceries. A solar kilowatt-hour costs four cents. These savings are real. They just don't feel like savings, because the parts of life they touch are small next to what got more expensive.

What this site is and isn't arguing

It is not the case that inflation is fake, or that the cost of living hasn't risen. CPI is a careful measurement of a basket of goods and services people actually buy, and it rose 150%. Real prices rose. Wages didn't fully keep up. That experience is genuine.

It is also the case that — running underneath the inflation story for thirty-five years — there has been a parallel deflation in technology that compounds at roughly 20% per year on the v4 index. That deflation is also real. Both can be true at once. The question worth asking isn't which line is right. It's: why didn't the falling line show up more in everyday prices?

The answer involves housing supply, healthcare consolidation, monetary policy, the structure of services, and a dozen other forces — none of which this index settles. What the index does is make the gap visible. Once you see it, you can argue about what to do.

The number on this page is the corrected one: our own audit found the previously published −96.25% was too conservative, and the v4.0 revision replaced it. That story — including what we got wrong — is told in full in the next essay.

For now, three lines on a chart. A 526-point gap. And a question: whose money got the productivity?