Inflation watch

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kenneal - lagger
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Re: Inflation watch

Post by kenneal - lagger »

BritDownUnder wrote: Fri Dec 31, 2021 12:04 pm I would like to know where all that extra money goes, whether to wages, or to corporate profits. That will be the clincher.

And Happy New Year BTW. It will an interesting one.
The fact that house prices and the Stock Exchange are still rising is a clue there, BDU!

And a Happy New Year to you as well.
Action is the antidote to despair - Joan Baez
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BritDownUnder
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Re: Inflation watch

Post by BritDownUnder »

Asset price inflation it is then. Shareholder funds increasing etc etc. I will benefit indirectly out of that I am sure. Hopefully the IKEA owners being good socially minded Swedes will allow a little ‘trickle down’ to the underclasses.
G'Day cobber!
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UndercoverElephant
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Re: Inflation watch

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https://www.theguardian.com/business/20 ... -stability
The Bank of England has badly misjudged the persistence of inflation. It is also underestimating the risks that its policies pose to financial stability.

The problems, however, don’t stop there. For much of the last decade, its policies of low rates have contributed significantly to inequality, boosting asset and house prices.
...and:
After 2008, monetary policy became the economic shock absorber. Now, monetary policy has gone from being carefree to careless – and it will be a long and painful challenge to restore monetary and financial stability.

Given the vulnerability of the economy, the Bank needs a well-communicated, timely, gradual and predictable exit strategy.
Yes that it what it needs. It does not have one.
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clv101
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Re: Inflation watch

Post by clv101 »

clv101 wrote: Fri Dec 10, 2021 1:38 pm US inflation to 6.8%, hold on to your hats! If you've got any cash best spend it while it's still worth something.
US inflation up to 7.0% :!:
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Re: Inflation watch

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https://www.theguardian.com/business/20 ... heap-money
Not since Ronald Reagan was president and Paul Volcker was the hardline chairman of the Federal Reserve has US inflation been as high as 7%, so inevitably the latest jump in the country’s cost of living index will have consequences.

The US central bank has historically tended to fear deep recession more than runaway inflation, scarred as it still is by the legacy of the Great Depression. The Fed, however, cannot ignore the risks of a wage-price spiral developing and will be forced to act.
We will see about that. I am not convinced they are going to take decisive action.
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Re: Inflation watch

Post by UndercoverElephant »

https://www.theguardian.com/business/20 ... ight-years
UK households have suffered the sharpest fall in the amount of cash they have available to spend for almost eight years, amid a worsening cost of living crisis driven by high inflation and rising energy bills.

According to a report by the insurer Scottish Widows, increasing living costs at the end of last year hit people’s pockets and led to the steepest decline in cash availability since the start of 2014
.
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clv101
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Re: Inflation watch

Post by clv101 »

"decline in cash availability" weird way to describe highest inflation in a generation.
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UndercoverElephant
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Re: Inflation watch

Post by UndercoverElephant »

clv101 wrote: Wed Jan 12, 2022 11:32 pm "decline in cash availability" weird way to describe highest inflation in a generation.
"Cost of living crisis" is also a weird term. "Cost of living" means it is a crisis encompassing everything that costs a non-trivial amount of money, but "crisis" also implies it is temporary, and there's no clear reason to believe this situation is temporary. Sounds an awful lot like collapse to me.
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Re: Inflation watch

Post by Stumuz2 »

Long way to go before we reach collapse velocity.
Collapse is a state of mind, there are a few bumps along the road yet to come, such as currency collapse, new world monetary system, resource rationing, small amounts at first, then bigger, until we are getting a de facto carbon rationing system.

The EU is already thinking of exemptions for yachts and private jets for their carbon pricing plan
https://www.zerohedge.com/markets/yacht ... icing-plan

Another decade at least before resource limits really start making an impact. I hope by then society may have woken up and changed their lifestyles bit, before they are compelled to, with resulting miserable lives.
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clv101
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Re: Inflation watch

Post by clv101 »

Stumuz2 wrote: Wed Jan 19, 2022 9:47 amAnother decade at least before resource limits really start making an impact.
We should be so lucky. I think this year is the year resource limits start making an impact. Oil, as we all know is critical, but loads of commodities, including food are at record prices, many major regions are going to see inflation approach 10% this year - we're entering a resource bottleneck the like of which we haven't seen for decades.
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Re: Inflation watch

Post by Stumuz2 »

Agree with all of that, but.....!

We came out of the 70,s resource bottleneck with a different society, Yes we discovered north sea oil, but society had profoundly changed. In the UK's case, we got rid of the empire, deference was gone, better individual rights emerged etc

I'm hoping with this resource squeeze, we come out changed, but better. More energy aware and thus efficient. Who would have thought that my brother would have told me that he is not buying a new car 'until things settle down'

BTW, brother has had over the last 30 years Jaguars BMW's, Aston Marton's. In fact i think he has spent half of his lifetimes earnings on flash cars!

Things can change for the better.
kenneal - lagger
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Re: Inflation watch

Post by kenneal - lagger »

Why would anyone be surprised that the prices of food and other goods are going up when we import 50% of our food and most of all other goods and the cost of the fuel to move them has sky rocketed? Increasing the interest rate is not going to bring down food prices that much as it is a basic commodity which can't be done without by anyone. Some might be able to reduce their purchases of luxury items, in food as well as goods, but many people are down to basic spending already and any further reductions due to tax increases will result in starvation.
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clv101
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Re: Inflation watch

Post by clv101 »

So far, the pound has held up well. If we see significant devaluation we'll really have a cat among the pigeons.
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UndercoverElephant
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Re: Inflation watch

Post by UndercoverElephant »

clv101 wrote: Wed Jan 19, 2022 1:18 pm So far, the pound has held up well. If we see significant devaluation we'll really have a cat among the pigeons.
Devaluation compared to what, though?
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BritDownUnder
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Re: Inflation watch

Post by BritDownUnder »

UndercoverElephant wrote: Wed Jan 19, 2022 2:58 pm
clv101 wrote: Wed Jan 19, 2022 1:18 pm So far, the pound has held up well. If we see significant devaluation we'll really have a cat among the pigeons.
Devaluation compared to what, though?
Bitcoin maybe.
G'Day cobber!
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