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OnlyMe

Time For The Boe To Wake Up And Smell The Roses

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CPI 2.5%? Really is becoming a joke that everybody can see through.

People won't be laughing if they are freezing to death becuase they can't pay the bills. Just think of all that debt based consumer growth that has helped to make the demand/supply of energy so totally out of whack. The banks printed money, the population borrowed it and spent it wrecking the cost base and competitiveness of their countries and bringing forward a potenital energy crisis becuase there was no way the supply and new sources could be found in time.

Never mind royal gongs for being this short-sighted, central bankers should be gong farmers instead, only need a good nose for that job.

http://news.independent.co.uk/business/new...ticle326720.ece

Shivers down the spine as fuel prices soar on fears for winter

On Friday, wholesale gas prices for delivery the next day rocketed by 70 per cent to 73p per therm, twice the average price last month.</i>

Edited by OnlyMe

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OnlyMe

I respect your views a lot. Not many can clearly see through the con as you do.

As you know it is not the BoE (Bank of England) that’s sets the CPI figure (which is not a full measure of inflation). Inflation is the dilution of existing money; M4 (UK) growth is probably a better measure IMHO, bet they hide the figure soon.

I think the BoE actually realised that the CPI figure is a con back when they started raising interest rates year or more ago or perhaps they always knew. But I think Gordon (and government) has told them to follow the CPI line, hence why interest rates are not higher....

I also remember reading the BoE website back then and their stated reason for being and it has subtly changed to what it is now.

I believe that the manipulation of our fiat world is so complete that we will not see a rise in inflation unless their control starts to break down or they want reported inflation rate to rise.

The general public is so dumb and so very much is done to fool them that the central bankers will reign supreme for a long while yet.

My salary increase (and most peoples) is tied to the CPI figure, that with rising costs of everything important houses, fuel, etc will result in me being slowly impoverished.

Our standard of living is cleverly being lowered without most people noticing, so that the banks create a balanced world to live in. It has already happened a great deal, as you only have to look at our personal level of debts to see that we are no longer as rich as we were.

I was told once that to measure your wealth see how much more you can borrow. If its not much then you are poor. How many in the UK can borrow any more on top of what they have already? We are near the limit.

And I have to ask if we in the UK deserve a better standard of living than those in China, India etc. anyway...???

People will wake up,,,when it's too late.

Regards

See

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I heartily concur with your views on inflation and that the 2.5% figure is a joke

however, anyone reading that article you linked to will see exactly the kind of arguments and "analysis" that have driven the oil price to where it is / was, much of it down to pure over-done speculation

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See,

OnlyMe

I respect your views a lot. Not many can clearly see through the con as you do.

Well it is one opinion, whether it is right or not only time will tell.

As you know it is not the BoE (Bank of England) that’s sets the CPI figure (which is not a full measure of inflation). Inflation is the dilution of existing money; M4 (UK) growth is probably a better measure IMHO, bet they hide the figure soon.

I think the BoE actually realised that the CPI figure is a con back when they started raising interest rates year or more ago or perhaps they always knew. But I think Gordon (and government) has told them to follow the CPI line, hence why interest rates are not higher....

Then they are running under a flase banner of independence, if it turns out for the worse then they will have failed the British Public in their duties - they are not servants to the incumbent government.

I also remember reading the BoE website back then and their stated reason for being and it has subtly changed to what it is now.

I believe that the manipulation of our fiat world is so complete that we will not see a rise in inflation unless their control starts to break down or they want reported inflation rate to rise.

I tend to agree, but that does absolutely nothing to diminish the real effects of that inflation - taken to the extreme people will just wake up one day and realise that they are totally insolvent.

The general public is so dumb and so very much is done to fool them that the central bankers will reign supreme for a long while yet.

Maybe so.

My salary increase (and most peoples) is tied to the CPI figure, that with rising costs of everything important houses, fuel, etc will result in me being slowly impoverished.

As we all will.

Our standard of living is cleverly being lowered without most people noticing, so that the banks create a balanced world to live in. It has already happened a great deal, as you only have to look at our personal level of debts to see that we are no longer as rich as we were.

Our standard of living is very stupidly being lowered, probably in the most stupid way possible becuase it is also causing the destruction of the current and furture viability of the economy as well as hitching a large proportion of the population to a level of debt that will re-double the fallout when the game fails.

I was told once that to measure your wealth see how much more you can borrow. If its not much then you are poor. How many in the UK can borrow any more on top of what they have already? We are near the limit.

I think credit standards are so lax even this metric has stood on its head somewhat.

And I have to ask if we in the UK deserve a better standard of living than those in China, India etc. anyway...???

Maybe so, but if it involves bankrupting us in the process and exaggerating the effects then I don't see why it has to be done this way.

People will wake up,,,when it's too late.

Well it might not be long because it alreay looks well beyond its sell-by date.

Regards

See

Regards to you too. ;)

I heartily concur with your views on inflation and that the 2.5% figure is a joke

however, anyone reading that article you linked to will see exactly the kind of arguments and "analysis" that have driven the oil price to where it is / was, much of it down to pure over-done speculation

No doubt there is a significant level of speculation, however speculation doesn't usually thrive in a vacuum there are some serious issues around energy supply that have just been ignored I don't know what can be more fundamental to an economy. Shame some of the £100's billions wasted on an artificial prop for the housing market wasn't spent on something productive.

Here's some figs from TMF (for the UK).

Industrial production figures for Oil and Gas:

2000 - 107.5

2001 - 101.3

2002 - 100.0

2003 - 94.4

2004 - 86.3

2005 - 70.7 (latest)

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Well it might not be long because it alreay looks well beyond its sell-by date.

Are you sure? I am not.

They have just appropriated a huge quantity of oil.

They are tracking us more now than ever before in history.

They have corrupted all the main political parties with the same fundermental financial agenda.

They control the media.

They control the law.

They have even made you think that money is more rare than if it grew on trees.

At the moment we have a good standard of living, and there is always hope it will continue.

But people are so naive.

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again, i agree with your views on energy - you would have thought that the advanced world(?) we think we live in might have addressed our long term fuel issues slightly better than we have so far (never mind the emissions we chuck out at the other end)

maybe it's just the reporting that is winding me up - as examples:

"Gas and electricity prices soared last week as traders fretted....."

read - fretted over how much money they could make

"The weather has been milder than average so far this winter. But the minimum temperature in London is forecast to drop to 3C tomorrow, down from 14C on Friday, and colder than average for this time of year."

read - it's been milder but lets forget that and concentrate on "it's going to get colder" therefore we have to panic

"Prices also rose last week because the Theddlethorpe gas terminal on the Lincolnshire coast, which handles around 10 per cent of daily gas consumption, was due to shut for maintenance over the weekend."

read - scheduled maintenance causes prices to rocket???

"Concerns over the reliability of the gas network have led to sharp price increases," said Mr Lowrey. "There is a fear that gas supplies from the Continent cannot be relied upon. If there are problems dealing with the increased demand - for example, in terms of supply reliability - then it can act as a barometer for the rest of the winter and market nerves can intensify. Monday morning will be a key time."

read - we've found something else we can create a bubble in

i wouldn't mind traders creating bubbles but with energy, we will all end up paying the price

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Are you sure? I am not.

They have just appropriated a huge quantity of oil.

They are tracking us more now than ever before in history.

They have corrupted all the main political parties with the same fundermental financial agenda.

They control the media.

They control the law.

They have even made you think that money is more rare than if it grew on trees.

At the moment we have a good standard of living, and there is always hope it will continue.

But people are so naive.

Bottom line - what people are left with in their pocket each month, it is either there or it isn't - I think increasingly it won't be and soon. Could well be wrong though although record bankrupticies (despite the effects of the law change) suggests that the debt situation is rapidly becoming untenable for too many people.

the end is nigh,

This is usually the way though isn't it? - every move has the reporting straplines - traders did this traders thought that and it was all caused by this that an the other. Bottom line is the move itself and that seems to suggest deep trouble in gas supplies.

i wouldn't mind traders creating bubbles but with energy, we will all end up paying the price

Financial blowback from printing so much money in the first place and so perversely affecting the markets that not only are the physical risks enhanced, but so are the sums of money available to drive speculative imbalances in the markets - monetary destabilization, encouraging positive feedback - not a wise thing to do. In fact when there was all the serious talk about deflation I think there was an implicit intent to try and drive money into commodities to create inflation, well we have it in spades, now what?

Edited by OnlyMe

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i agree with you again - it just seems that the way commodities etc are traded at the moment, even the most expected and regular occurences seem to cause sharp movements in prices which they didn't use to - these traders are people sitting in front of terminals and having a direct impact on the population based on how they react to the latest news headline

as you rightly say, this will hit everyone in their pockets

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the end is nigh,

When sound money goes out the window anything can happen, not just traders responding the whole investment community can follow track too.

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I think there was an implicit intent to try and drive money into commodities to create inflation, well we have it in spades, now what?

Agreed and good question. Not sure.

Internal inflation would be easy to increase (via wages), as another adjustment in how CPI is measured would do that without having to increase the cost of commodities, which are mainly imports.

I think what we have at the moment is external inflation (raw imports getting more expensive, oil, copper yada yada).

So maybe all the central bank foreign currency exchange manipulations are coming home to roost? Perhaps possibly too many British pounds in other central banks being off loaded….. Do they see us as a bad investment? Has the race to the bottom started already?

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See

Internal inflation would be easy to increase (via wages), as another adjustment in how CPI is measured would do that without having to increase the cost of commodities, which are mainly imports.

Raising internal inflation in this way without any reaction in the £ would simply increase our costs in a highly competitive world and further reduce headcount and move more busines offshore, in fact squeeze hard enough and you could get all sorts of further reductions in internal trade as larger parts of the retail trade shifts to cheaper sources - right down to individual purchasers

I think what we have at the moment is external inflation (raw imports getting more expensive, oil, copper yada yada).

Yes and a move like the above to increase the internal inflation would probably have to result in a pro-ratat devaluation of the £ to maintain any sort of semplnace of cost parity of labour (which is alrady hopelessly out of balance) and the currency move would increase external inflaiton even further.

So maybe all the central bank foreign currency exchange manipulations are coming home to roost? Perhaps possibly too many British pounds in other central banks being off loaded….. Do they see us as a bad investment? Has the race to the bottom started already?

We will see.

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Raising internal inflation in this way without any reaction in the £ would simply increase our costs in a highly competitive world and further reduce headcount and move more busines offshore, in fact squeeze hard enough and you could get all sorts of further reductions in internal trade as larger parts of the retail trade shifts to cheaper sources - right down to individual purchasers

Yes.

Yes and a move like the above to increase the internal inflation would probably have to result in a pro-ratat devaluation of the £ to maintain any sort of semplnace of cost parity of labour (which is alrady hopelessly out of balance) and the currency move would increase external inflaiton even further.

Aye.

We will see.

We will see a slow lowering in the standard of living.

For people to keep up a reasonable standard of living; personal debt will have to be paid off (or cleared some other way) and house prices are going to have to go the other way,

"House prices will go down forever" will be the new saying soon.

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whoops_apocalypse,

Not the only ones either by the looks of things.... second largest oilfield in the world.

http://www.ameinfo.com/71519.html

Kuwait's biggest field starts to run out of oil

The peak output of the Burgan oil field will now be around 1.7 million barrels per day, and not the two million barrels per day forecast for the rest of the field's 30 to 40 years of life, Chairman Farouk Al Zanki told Bloomberg.

See,

With low real wage inflation doesn't seem to be any other alternative than for medium/long term adjustment.

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whoops_apocalypse,

Not the only ones either by the looks of things.... second largest oilfield in the world.

http://www.ameinfo.com/71519.html

Kuwait's biggest field starts to run out of oil

The peak output of the Burgan oil field will now be around 1.7 million barrels per day, and not the two million barrels per day forecast for the rest of the field's 30 to 40 years of life, Chairman Farouk Al Zanki told Bloomberg.

See,

With low real wage inflation doesn't seem to be any other alternative than for medium/long term adjustment.

Aye.

(Kuwait's biggest field starts to run out of oil - I am Stunned.) I ran next?

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See,

Non-specific on the timing, but quite specific on the consequences.

http://news.bbc.co.uk/1/hi/business/3777413.stm

"In my opinion, unfortunately, there will be no linear change," says Iran's Ali Bakhtiari. "There will only be sudden explosive change."

"The people who will be least affected will be the super poor, who already have no access to energy, and the super rich who do not care if oil is $100 a barrel."

"It is everyone who is in the middle who will be hurt the most," says Mr Bakhtiari. "When the crisis comes there will be enormous changes."

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See,

Non-specific on the timing, but quite specific on the consequences.

http://news.bbc.co.uk/1/hi/business/3777413.stm

"In my opinion, unfortunately, there will be no linear change," says Iran's Ali Bakhtiari. "There will only be sudden explosive change."

"The people who will be least affected will be the super poor, who already have no access to energy, and the super rich who do not care if oil is $100 a barrel."

"It is everyone who is in the middle who will be hurt the most," says Mr Bakhtiari. "When the crisis comes there will be enormous changes."

"The way to increase energy security is to reduce demand," he says.

It will be interesting to see if the fuel tax is reduced to keep fuel consumption in the UK the same.

Or are we all going to cut back......

An interesting article, thanks. It really reinforces my view that taxes are viewed as shock absorbers by central banks.

Edited by See

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When sound money goes out the window anything can happen, not just traders responding the whole investment community can follow track too.

Timely. :)

http://investing.reuters.co.uk/news/newsAr...COMMODITIES.xml

Pension funds putting more money into commodities

Mon Nov 14, 2005 2:06 PM GMT

Printer Friendly | Email Article | RSS

By Melanie Cheary

LONDON (Reuters) - Pension funds are increasingly looking to invest in commodities to balance their risk exposure and to reap higher returns, Credit Suisse Asset Management's head of consultant relationships said.

Terry Mellish told Reuters on Monday that although pension funds -- both private and public -- still predominantly invest in equities and bonds, he is seeing an increased level of interest in alternative investments, especially commodities

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I agree the whole CPI thing is a joke, and it will soon become very apparent!

I mentioned a week or two back, when I was being told to buy a house (yes, this happens regularly) that people just can't afford houses at current prices... in a return argument I was told they can (yes dear, of course)!

Well, I have noticed alot of people complaining about increased costs of, well, everything! Petrol, food, services etc etc etc. And I said (being an arsehole that I am), it's ok, CPI inflation is only 2.5%, so your payrise of 2.5% (3% if you're very lucky) will cover all these extra costs... Then went on to say, that your council tax increase will be around 7% (if you believe Crash Gordon) or 10% (if local councils get what they want)! I left the crowd in an uproar... muhahahahah.

My point? Well, the public have just accepted all these increases because their assets have been rising in value, so people are happy and can borrow against them. Now, they are not going up (as fast, down, sideways - whatever) people are feeling the pinch.

I could be a real evil and keep rubbing this in for the next year and a half, and use the argument that 'rampant inflation' is good - 'YOU' said so!

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Well, I have noticed alot of people complaining about increased costs of, well, everything! Petrol, food, services etc etc etc. And I said (being an arsehole that I am), it's ok, CPI inflation is only 2.5%, so your payrise of 2.5% (3% if you're very lucky) will cover all these extra costs... Then went on to say, that your council tax increase will be around 7% (if you believe Crash Gordon) or 10% (if local councils get what they want)! I left the crowd in an uproar... muhahahahah.

Ooo Nasty.

I suppose it is worth saying more than once in case it is misunderstood. CPI is not inflation.

It is not a measure of inflation. It is a measure of how a few things that the government want to measure have decreased in price.

If you chose what would be measured I bet it would look a lot different to 2.5% this year.

Inflation is the dilution of existing money.

It is not a case so much of "Time for the BoE to wake up and smell the roses", rather it is time for general public to wake up and smell the BS they have been fed. I bet they don't anytime soon though. ZzzzZzzZzz

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Ooo Nasty.

I'm not really that nasty, honest. I do get worked up from time to time and wish people who keep encouraging people to get into massive debt spend at least a few seconds thinking about it first! What goes around, comes around - I guess.

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I'm not really that nasty, honest. I do get worked up from time to time and wish people who keep encouraging people to get into massive debt spend at least a few seconds thinking about it first! What goes around, comes around - I guess.

Too right. I get fed up with those sort of people too and tease them the same. Don't feel guilty. Well I don't :unsure:

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Why is it that people abhor inflation in all its forms

with the exception of house prices?

Because in theory, they can sell up and move to a cheaper part of the country, or a smaller house, or a cheaper country and have a real gain.

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Yes, in theory, but the majority do not.

Their paper gain is usually realised on retirement

when they downsize.

In the meantime, they keep paying till it hurts,

all the way up the ladder, along with the rest of us

ABB

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Yes, in theory, but the majority do not.

Their paper gain is usually realised on retirement

when they downsize.

ABB

This is why so many (not unreasonably) regard their house as their pension. Everyone wants to maximize the value of their pension.

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  • 302 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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