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Realistbear

Lack Of Snow Drives Services P M I To 8 Month High

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http://uk.finance.yahoo.com/news/Recovery-Dec-snow-drives-reuters_molt-3657185221.html?x=0

http://uk.finance.yahoo.com/news/Recovery-Dec-snow-drives-reuters_molt-3657185221.html?x=0

Recovery from
Dec snow
drives services PMI to 8-month high
Keith Weir, 9:48, Thursday 3 February 2011
LONDON (Reuters) - Activity in the dominant services sector expanded at its fastest pace in eight months in January as business recovered after December's snow disruption, a survey showed, which may bolster the case for higher rates.
Thursday's purchasing managers' survey from Markit/CIPS also showed a record jump in input cost inflation in the services sector, which is likely to worry Bank of England policymakers who hold their rate-setting meeting next week.
The headline services PMI activity index rose to 54.5 in January from a 20-month low of 49.7 in December, the highest since last May and well above forecasts for a reading of 51.4.

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Wage increases will be the one and only trigger for rate rises. King was explicit about that, his strategy is to deliberately degrade the standard of living of the people in order to hold it together.

If you want rate increases, go in strike for more money (if you dare).

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Wage increases will be the one and only trigger for rate rises. King was explicit about that, his strategy is to deliberately degrade the standard of living of the people in order to hold it together.

If you want rate increases, go in strike for more money (if you dare).

It's not just wage earners that can strike for more money.

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Higher wages feed higher prices.....defeats the object. ;)

I was thinking of the holders and buyers of government bonds.

If they decide the "safety" of gilts is not worth a negative yield, they might decide to withold their labour investment.

At which point, the price comes down and the yield goes up...

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According to Warner in the Telegraph, "Panic Over - No Double Dip":

http://blogs.telegraph.co.uk/finance/jeremywarner/100009440/panic-over-no-double-dip/

Phew! Services rebounded strongly in January, according to the latest purchasing managers’ survey from Markit/CIPS. That ought to mean the UK economy is not heading for a double dip after all, at least for the time being.

The rebound shouldn’t have been so surprising after the largely weather induced negative of December, but you’d be amazed how many people had begun to think another recession a done deal. Despite the shock setback in fourth quarter output, the recovery seems to be broadly on track. The strong services data follows buoyant manafacturing survey evidence earlier this week and an insipid recovery in construction.

Rather more worrying, the latest PMIs also showed a record jump in input cost inflation in the services sector, putting further pressure on the Bank of England to start raising interest rates. Again, I don’t know why this should have surprised anyone.

Costs are surging everywhere. Some members of the Bank of England’s Monetary Policy Committee recognise it, but the majority remains firmly in denial. With so much spare capacity allegedly slopping around the economy, the argument is that there are no significant domestic inflationary pressures. A growing weight of anecdotal evidence, pointing to skill shortages in key areas, strongly suggests otherwise.

One set of positive PMIs does not a summer make, but they should at least temporarily silence those who argue that the Government is taking big risks with the economy by cutting the deficit so fast. As has frequently been pointed out, we now have two polar opposite approaches to recovery economics.

In the US, they are keeping their foot flat down on the fiscal accelerator. In Britain, there is a much more urgent attempt to address the deficit. Personally, I’ve never believed Britain has any option in the matter.

We don’t have the luxury of America’s virtually limitless capacity to borrow. But even assuming there was a choice, the intellectual case for public sector spending cuts remains a powerful one. We’ll see which approach works best, but those claiming that the data supported the American view will this morning be feeling a little deflated.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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