Forget about inflation hitting your wallet unless you're rich. The stuff wealthy people buy just got more expensive, a Harvard study shows.

• Biden and Fed chair Jerome Powell have been saying throughout 2021 that higher inflation will be temporary.
• Most Republicans and some Democrats have been sounding increasingly worried they're wrong.
• Harvard research shows the wealthy are feeling the pinch more - and maybe that's related to who sounds worried.

This summer, bankers and business leaders seemed to be in a panic about big, bad price inflation coming to wreck the economy. Earlier this month, billionaire investor John Paulson rang the alarm and claimed there would be a rush for gold.

But on Tuesday, the US government's official measure of inflation showed a cooling off in consumer prices for the second month in a row, suggesting that worries were overblown.

President Joe Biden and Fed Chair Jerome Powell represent "team transitory" - the ones saying these dramatic price increases are only temporary and in fact could be a good thing for the economy, since they signal that wages are also on the rise.

New research from Harvard economist Alberto Cavallo shows both sides were right, sort of: Inflation has been worse for wealthy people, and it's looking very transitory for everyone else.

Cavallo's work has to do with how inflation measures like the Consumer Price Index, published by the Bureau of Labor Statistics, are built around "consumption baskets," which are based on annual surveys that ask people how they spend their money.

The results of those surveys are used to figure out what an average household spends on different things like food, housing, cars, education, or health care.

Cavallo looked at what Americans in the top and bottom fifths of the income distribution spent money on, adjusted by real-time spending data that showed how those patterns changed during the pandemic.

The surveys used by the BLS to construct the baskets show that lower-income households spend a higher share of their money on things like groceries and shelter, while wealthier households can afford to spend a larger percentage of their dollars each month on things like transportation, recreation, and dining out.

Additionally, COVID-19 pandemic threw consumption patterns into chaos over the last year and a half. Since the headline CPI is based on consumption baskets that are only updated once every year or so, the normal inflation measure can miss how changes in spending interact with rising prices among different categories.

Cavallo has been tracking inflation based on adjusted consumption baskets since last fall, when inflation was extremely low. At the time, lower income households were seeing prices rise more than high-income houses were, but that pattern has shifted.

Prices for things that more affluent Americans spend more of their money on, like airline fares and new cars, spiked amid reopening and supply chain disruptions, outpacing categories like groceries and housing costs have remained relatively stable, in part due to interventions such as mortgage forbearance and a moratorium on evictions.

Inflation is certainly an economic reality in the US, but the real impact of it ultimately comes down to what you're buying.

And in 2021, those who are feeling the impact of inflation the most are Americans who can likely afford it.