mr brightside wrote: ↑16 Jun 2022, 07:00
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When you say 'plebs' do you mean us, the people?
Yes. That's how the bankers and financiers see us, if they see us at all.
To my discredit, i prefer not to see the terrible situation of homelessness in this country. I prefer not to notice how many more people are sleeping in bus shelters and sitting on the pavement asking for money than there were back in the 90s when i first started hitting the nightclubs of Leeds. I prefer not to know how many of the poor sods get kicked half to death by pissheads every week just for being homeless. If i prefer not to notice them, then without doubt, this phenomenon exists in the minds of the bankers and financiers to whom you refer.
One of the problems with everything that's crippling our society currently is that the power for real change exists with people who are not affected by any of it. Boris Johnson would pull any drowning person from a freezing canal, but when it comes to making petrol affordable it's more a case of 'you won't see it from my house'. It's basically a society-wide value system misalignment.
Persistence of habitat, is the fundamental basis of persistence of a species.
Ah! But those who were not affected are increasingly becoming affected by the extraordinary increase in inflation driven by world wide resource shortages in a wide variety of different products. This inflation will work it's way up the salary scale as interest rate increases affect mortgage payments. Fuel costs will be affecting commuting costs as well and higher wages for striking transport workers will result in higher season ticket prices.
This takes me back to the sixties and seventies with public sector unions using their power to push for inflationary wages to ameliorate the problems caused by inflation while private sector workers just had to lump it or risk losing their jobs.
What really annoys me is the seeming unwillingness of government to tax the foreign owned tech and online giants which are destroying tax paying and ethical companies based and taxed in this country. This is throwing more of the tax burden onto individuals and, to avoid this, government is cutting services instead.
It is all part of the disruption which is part of the longer term destruction of the economic system.
Complacency led policymakers to misdiagnose inflation
A year ago, inflation appeared under control. Published annual consumer price rises stood at 2 per cent in the eurozone and 2.1 per cent for the UK in May 2021. The 5 per cent figure for the US was higher than normal, but the Federal Reserve dismissed concerns, saying price rises reflected “transitory factors” with chair Jay Powell highlighting lumber and used car prices that were temporarily high and airline and hotel costs that were just climbing back to normal.
What has happened since has surprised all the main advanced economy central banks. The latest published inflation rates stand at 8.6 per cent in the US, 8.1 per cent in the eurozone and 9.1 per cent in the UK. Instead of always blaming something out of their control, central bankers are now taking action.
We should therefore use this moment to take stock. What were the mistakes made in thinking over the past year? And what does this mean for policy and the economic outlook?
Fundamentally, we have rediscovered that resource constraints are real and they matter...
Further mistakes in monetary policy are highly likely and we should expect reversals in policy as central banks try to find the right response to a problem they did not think could happen.
We must deal with reality or it will deal with us.
LONDON, June 26 (Reuters) - The world's central bank umbrella body, the Bank for International Settlements (BIS), has called for interest rates to be raised "quickly and decisively" to prevent the surge in inflation turning into something even more problematic.
We must deal with reality or it will deal with us.
Leading economies are close to “tipping” into a high-inflation world where rapid price rises are normal, dominate daily life and are difficult to quell, the Bank for International Settlements warned on Sunday.
In its annual report, the BIS, the influential body that operates banking services for the world’s central banks, said these transitions to high-inflation environments happened rarely, but were very hard to reverse.
We must deal with reality or it will deal with us.
Raise interest rates quickly, destroy the world economy so that demand is reduced so that comodity prices are reduced and you will fix inflation. The fact that no one will have enough money to buy food will sort out the inflation in food prices as well.
So what's wrong with that?
The fact that people will starve is a problem for other people not economists and *ankers.
kenneal - lagger wrote: ↑27 Jun 2022, 05:06
Raise interest rates quickly, destroy the world economy so that demand is reduced so that comodity prices are reduced and you will fix inflation. The fact that no one will have enough money to buy food will sort out the inflation in food prices as well.
So what's wrong with that?
Demand destruction caused by rising free market prices is not enough to stop the inflationary spiral. To stop it you need to destroy demand faster than the free market can do on its own, in order to engineer a market surplus.
The fact that people will starve is a problem for other people not economists and *ankers.
There isn't enough food so somebody will starve. That isn't even economics.
What I think this boils down to is that in order to control inflation now, central banks need to burst the "everything bubble" that they've created since the 2008 financial meltdown. Global depression or out-of-control inflation. That is the choice on offer.
We must deal with reality or it will deal with us.
Global depression is only a real problem because of the necessity for perpetual growth caused by the payment and charging of interest. Without the interest it just becomes a question of managing people's expectations.
I think it's a mistake to look at this from a purely mechanistic standpoint, how is people's will to survive and desire to persist going to get factored in? The whole landscape could change very quickly with a quantum jump of awareness amongst the population, and if we aren't considering such things then we aren't seeing the whole picture. Using the old 'clockwork universe' paradigm to make predictions will surely lead to error.
Persistence of habitat, is the fundamental basis of persistence of a species.
However we look at this we can't adopt a reductionist stance, which is what is required in the developed world to combat climate change, without a change in the banking system.
Soaring inflation will hit Britain harder than any other major economy during the energy crisis, with inflation likely to stay higher for longer, the governor of the Bank of England has warned.
Speaking with other central bankers at a European Central Bank conference in Sintra, Portugal, Andrew Bailey said that the energy price shock that all European countries are experiencing will likely cause the UK economy to deteriorate more quickly and severely than other nations.
"Unfortunately, there is going to be a further step-up in UK inflation later this year because that is a product of the way the energy price cap interacts with the energy prices we have observed over the last few months," he said. "I think the UK economy is probably weakening rather earlier and somewhat more than others."
The "structural legacy" of Covid in the labour market in Britain has made the problem worse as businesses grappled with a labour shortage.
We must deal with reality or it will deal with us.
"Cost of living" has now got its own place on the BBC news title bar, next to "War in Ukraine." I can't foresee the circumstances under which it will be removed. It might as well just say "collapse".
