Sour Mash Posted April 17, 2012 Share Posted April 17, 2012 I am reliably informed by the experts on here that what we are actually experiencing is DEFLATION Any evidence to the contrary is just a figment of your imagination Apparently These are the people who found it 'unexpected' one assumes Quote Link to comment Share on other sites More sharing options...
porca misèria Posted April 17, 2012 Share Posted April 17, 2012 Up on food prices. The most basic necessity of all. Now, supposing there were a bit of pressure on the supply side of food. Like, say, a bit of a water shortage damaging production over the coming season. I wonder what that might do for food prices? Quote Link to comment Share on other sites More sharing options...
Democorruptcy Posted April 17, 2012 Share Posted April 17, 2012 Index linked pension, no worries about future annuities for him Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted April 17, 2012 Share Posted April 17, 2012 So inflation is still only slightly going up? Quote Link to comment Share on other sites More sharing options...
Sour Mash Posted April 17, 2012 Share Posted April 17, 2012 To be fair to the Deflationists, the more money you are forced to spend on food, fuel, taxes, etc the less there is to spend on big ticket items like holidays, cars, electronics, houses. Especially if easy credit (normally used to oil big ticket deals) is dwindling. Throw in some real interest rate rises and deflation of almost anything considered to be 'discretionary spend' looks much more likely. Buckers The rule of thumb is that stuff bought with cash should tend to inflate in price, stuff generally bought using credit should tend to deflate in price. The house price index seems to be bucking the trend but what would appear to be because it is hugely supported by London/The South-East where QE money is gushing forth. House prices outside of that region are definitely dropping, crashing in parts (like NI). Quote Link to comment Share on other sites More sharing options...
moonriver Posted April 17, 2012 Author Share Posted April 17, 2012 Should be "But questions are being raised about whether the forecasts are wrong." Indeed that is a question that is always avoided, as is the mention of what effect all this QE'ing has on inflation. Quote Link to comment Share on other sites More sharing options...
rantnrave Posted April 17, 2012 Share Posted April 17, 2012 The rule of thumb is that stuff bought with cash should tend to inflate in price, stuff generally bought using credit should tend to deflate in price. The house price index seems to be bucking the trend but what would appear to be because it is hugely supported by London/The South-East where QE money is gushing forth. House prices outside of that region are definitely dropping, crashing in parts (like NI). IIRC, each of the upturns in the deadcat's bounces can be traced to injections of QE. Quote Link to comment Share on other sites More sharing options...
Ash4781 Posted April 17, 2012 Share Posted April 17, 2012 Unleaded petrol is up to around 144p in my area (Kent). 150p here we come Quote Link to comment Share on other sites More sharing options...
Game_Over Posted April 17, 2012 Share Posted April 17, 2012 To be fair to the Deflationists, the more money you are forced to spend on food, fuel, taxes, etc the less there is to spend on big ticket items like holidays, cars, electronics, houses. Especially if easy credit (normally used to oil big ticket deals) is dwindling. Throw in some real interest rate rises and deflation of almost anything considered to be 'discretionary spend' looks much more likely. Buckers Yes, but most of what we buy is imported so low interest rates and QE mean a weak pound which pushes up the cost of imports. Also higher costs on business ie rent, business rates, fuel costs etc, etc mean that companies are forced to increase prices or go bust - regardless of how weak demand may be This is how we end up with Stagflation Which is what I predicted and what we have got. Quote Link to comment Share on other sites More sharing options...
campervanman Posted April 17, 2012 Share Posted April 17, 2012 Pound and Euro have been appreciating against the USD recently and also oil is now below 120 usd. Here in France deisel is now below 1.40 euros (£1.15) a litre at my local Intermarche. Have fuel prices come down in the UK over the past month? Quote Link to comment Share on other sites More sharing options...
Game_Over Posted April 17, 2012 Share Posted April 17, 2012 If it looks like a duck and quacks like a duck..... What we have is Stagflation NOT deflation. Quack! quack! Quote Link to comment Share on other sites More sharing options...
phead Posted April 17, 2012 Share Posted April 17, 2012 God help us if Penfold predicts that the sun will rise tomorrow. Quote Link to comment Share on other sites More sharing options...
19 year mortgage 8itch Posted April 17, 2012 Share Posted April 17, 2012 Pound and Euro have been appreciating against the USD recently and also oil is now below 120 usd. Here in France deisel is now below 1.40 euros (£1.15) a litre at my local Intermarche. Have fuel prices come down in the UK over the past month? Do you not see the news? We had a petrol panic, fuel running out everywhere and the price shot up 5p and hasn't come back down yet round here. That was 2 weeks ago. Quote Link to comment Share on other sites More sharing options...
Sour Mash Posted April 17, 2012 Share Posted April 17, 2012 BBC Hugh Pym: "But questions are being raised about whether oil prices will derail the forecasts." They try to blame it on extenuating circumstances all the time. They are not extenuating, that really is inflation happening. That's what it does. Should be "But questions are being raised about whether the forecasts are wrong." It's amazing how the line "It's been down to unfortunate one-off circumstances" has been trotted out constantly over the last four years as an excuse from strong inflation without any sort of challenge by the media pundits. You'd have thought that anyone capable of comprehending a smidgen of logic would reason that random factors would be as likely to drive prices down as up and would be happening all the time, hence a contiguous four year run of strong price increases due to arbitrary events is most unlikely. Apparently that simple reasoning is beyond the 'economic experts' who dish out what is little more than propaganda to the public. Quote Link to comment Share on other sites More sharing options...
campervanman Posted April 17, 2012 Share Posted April 17, 2012 (edited) Do you not see the news? We had a petrol panic, fuel running out everywhere and the price shot up 5p and hasn't come back down yet round here. That was 2 weeks ago. Yes I did see that but prices should be coming down now. Why arn't there more noises coming from UK derivers? Have they just given up? Here they would have the ports blocked by now if fuel prices hadn't come down. Edited April 17, 2012 by campervanman Quote Link to comment Share on other sites More sharing options...
happy_renting Posted April 17, 2012 Share Posted April 17, 2012 The rule of thumb is that stuff bought with cash should tend to inflate in price, stuff generally bought using credit should tend to deflate in price. The house price index seems to be bucking the trend but what would appear to be because it is hugely supported by London/The South-East where QE money is gushing forth. House prices outside of that region are definitely dropping, crashing in parts (like NI). Not sure for whom your 'rule of thumb' is for, but it makes little sense to buy a deflating asset with credit. Credit is used to buy something before you actually have the money, and is costly. For many things, therefore, it makes even more sense to wait until you can afford it - and at a s cheaper price. Quote Link to comment Share on other sites More sharing options...
19 year mortgage 8itch Posted April 17, 2012 Share Posted April 17, 2012 Yes I did see that but prices should be coming down now. Why arn't there more noises coming from UK derivers? Have they just given up? Here they would have the ports blocked by now if fuel prices hadn't come down. C'est la vie. These are local Asda prices nr. Warrington, 95RON petrol. 20/2 132.7p 5/3 133.7p 16/3 134.7p 5/4 137.7p 16/4 138.7p Other places nearer home are typically 141.9p and above Quote Link to comment Share on other sites More sharing options...
Sour Mash Posted April 17, 2012 Share Posted April 17, 2012 Not sure for whom your 'rule of thumb' is for, but it makes little sense to buy a deflating asset with credit. Credit is used to buy something before you actually have the money, and is costly. For many things, therefore, it makes even more sense to wait until you can afford it - and at a s cheaper price. I never said it made sense to buy a deflating asset with credit. I'm pointing out that with credit harder to get, assets bought using it have to fall in price. Quote Link to comment Share on other sites More sharing options...
OnlyMe Posted April 17, 2012 Share Posted April 17, 2012 The largest downward effect between Feb and March was motoring expenses apparently. The latest fuel figures are not even in this bunch of stats. The crooked bank will have more to explain next month unless some real statisical sleight of hand occurs between now and then. Quote Link to comment Share on other sites More sharing options...
winkie Posted April 17, 2012 Share Posted April 17, 2012 Unleaded petrol is up to around 144p in my area (Kent). 150p here we come .......cancelling next years season ticket, no more meals out....hope the sun keeps shining to make up for it. Quote Link to comment Share on other sites More sharing options...
19 year mortgage 8itch Posted April 17, 2012 Share Posted April 17, 2012 The largest downward effect between Feb and March was motoring expenses apparently. The latest fuel figures are not even in this bunch of stats. The crooked bank will have more to explain next month unless some real statisical sleight of hand occurs between now and then. 10/01 129.9p 26/01 130.7p 20/2 132.7p 5/3 133.7p 16/3 134.7p 5/4 137.7p 16/4 138.7p 2011 Not so much petrol station consistency but for comparison 13/01 127.9p 12/04 133.9p Quote Link to comment Share on other sites More sharing options...
Venger Posted April 17, 2012 Share Posted April 17, 2012 To be fair to the Deflationists, the more money you are forced to spend on food, fuel, taxes, etc the less there is to spend on big ticket items like holidays, cars, electronics, houses. Exactly. There will be more good deals to be found on discretionary spend items. And those sectors being squeezed. Occasionally now with deals to be found, with MT's Rockport boots reduced down from something like £130 to £27. There's a lot less money around. Lower mortgage costs have delayed things a while, allowing for spending and to absorb higher inflation for the basics; food and fuel and utilities, but many more people are feeling the squeeze of it now. Those will savings will have all the options. Those with debt and those who've already spent their money away on big ticket items, will have to start selling their stuff for less in the market to raise money. Quote Link to comment Share on other sites More sharing options...
JaneTracy Posted April 17, 2012 Share Posted April 17, 2012 I quite enjoyed this reminder of what members of the Bank of England's Monetary Policy Commitee have told us in the past. More problems for Adam PosenFrom last September. I don’t really see the inflation threat. If inflation were to get bad it’s pretty easy for us to take it down. Apparently not that easy Adam! The Governor of the Bank of England stumbles too Back on the 2nd of March 2011 Mervyn King told us this. The projections that we published in the inflation report a couple of weeks ago have the characteristic that the inflationary pressures are pretty much back to target by around the middle of this year. Yes inflation was supposed to be back on target in the middle of 2011 whereas in the spring of 2012 it remains 1.5% above it. http://www.mindfulmoney.co.uk/wp/shaun-richards/japan-lends-free-money-to-the-imf-whilst-the-uks-inflation-rise-embarasses-the-bank-of-england/#disqus_thread Still never mind adding more QE when you are above your inflation target will help.......Oh wait a minute! Quote Link to comment Share on other sites More sharing options...
Bruce Banner Posted April 17, 2012 Share Posted April 17, 2012 What we have is Stagflation NOT deflation. Quack! quack! Raise you Biflation. Quote Link to comment Share on other sites More sharing options...
Bruce Banner Posted April 17, 2012 Share Posted April 17, 2012 Not sure for whom your 'rule of thumb' is for, but it makes little sense to buy a deflating asset with credit. Credit is used to buy something before you actually have the money, and is costly. For many things, therefore, it makes even more sense to wait until you can afford it - and at a s cheaper price. It makes little sense to buy a deflating asset with hard cash either. Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.