Wednesday, Feb 17, 2010
Britain leads the G7 for inflation...
Spectator: Short term or long term inflation?
Britain’s inflation rate is already ahead of the rest of the G7. Ally that fact to languishing sterling and Britain’s dependence on imports and the nation faces a dramatic decline in living standards.
(Originally posted on the forums, but I thought I'd post here too)
Posted by hpwatcher @ 08:17 AM (860 views) Add Comment
16 Comments
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1. fallingbuzzard said...
This is a misleading chart because its inflation including the effect of indirect tax cuts and rises. If anything, the UK has experienced even higher inflation than is indicated during the last year. It has been stubbornly within the 3% to 5% range for a year now. CPIY are the figures that people should refer to, not CPI, since it strips out tax effects. There has been no inflation dip in the UK
2. need-a-crash said...
Good point @1.
On the news last night there were saying how Merv had predicted inflation would fall back from 5% in 2008 (and it did) so he must be right now when he says it will fall back. Yet they failed to even mention the fact that late-2008 & 2009 we entered a recession with a VAT cut, so of course inflation fell back. What does Merv think will pull inflation back this time? Double-dip recession perhaps?
3. Crunchy said...
Hyperinflation food shortages.
Merv/CBOE guilty by association.
4. freemanphil said...
I think hyperinflation is coming.
5. hpwatcher said...
I think hyperinflation is coming
Yes, just wait until the big pay rise demands start coming.......then the stage will be set.
6. mountain goat said...
People I know are taking pay cuts to keep their jobs...
7. Neil B said...
QE + low GDP = hyperinflation
How many more times are we going to read that inflation "unexpectedly rose"? Unexpected to whom?
8. hpwatcher said...
People I know are taking pay cuts to keep their jobs...
Yes, I know some too. Actually I was talking to a recruitment consultant yesterday, and he was telling me that wages in my sector were beginning to increase quite quickly. But, I guess we shall see....
9. freemanphil said...
Feeling Queasy? "This phenomenal 'queasing' is greater by far than anything Weimar Germany tried
Well, hyperinflation has already occurred, we should have had a deflationary depression. It is just a matter of time before inflation is expressed in hyperinflated consumer prices. Lets see if the increased increases increase next month.
10. smugdog said...
So, we should be thinking in terms of hard assets as a store of value?
Can you think of any?
11. freemanphil said...
Gold and silver are the only ones that work well both in inflation and deflation, tho silver can be hit by deflation some, because we will later see a collapse of industry, plunging industrial commodities. Gold is primarily a monetary metal with minimal industrial uses where it is recycled most times its used, so, plunging demand doesn't reduce demand for gold and it becomes a flight to quality asset.
UK coins are tax free. Sovereigns are easy to store or, you can store them at spink,com in their vaults for only a 1% fee. They aren't a bank, so, much better than bank vaults that could go bust. There really isn't anywhere else to go, but, we all need water filters, storable food, and, something for protecting your family in-spite of ridiculous human rights laws that protect criminals who attack your home.
12. smugdog said...
Any more, anyone?
13. fallingbuzzard said...
Slaves
14. crash bandicoot said...
Hard assets, let me see, fine art, classic cars, tulp bulbs and property - see the connection? If you're looking to expand your portfolio let me recommend football club or telecom company shares, all but one of those are trading at way below their historical peak. Can't go wrong.
15. quiet guy said...
smugdog,
Property.
There. I've said it. But not for rental income (rents would be negligible in a true hyperinflationary environment) so I'm only thinking of a long-term place of residence and not until some indication of economic policy has been revealed after the election (every political party is scared to tell the truth right now.)
By the end of the year, everything should be a lot clearer - and we should have some idea if the deflationary theories are correct as well.
16. quiet guy said...
On the other hand, you might find yourself playing the Queen's Red Race:
http://www.oftwominds.com/blogfeb10/red-queen02-10.html