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Sisyphus

M0 Money Supply Figures Up

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Further evidence of inflation

M0 Money supply Jan provisional (MOM) + 2.3% (vs expected + 0.9%)

M0 Money supply Jan provisional (YOY) +6.5% (vs expected +5.3%)

Forget CPI, if GDP does not grow at the same pace, then there you have your inflation!

does anyone know how seriously the MPC take these figures?

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Further evidence of inflation

M0 Money supply Jan provisional (MOM) + 2.3% (vs expected + 0.9%)

M0 Money supply Jan provisional (YOY) +6.5% (vs expected +5.3%)

Forget CPI, if GDP does not grow at the same pace, then there you have your inflation!

does anyone know how seriously the MPC take these figures?

One would hope that they would take these figures very seriously. CPI just doesn't work.

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unfortnately gordon clown has given the " independent " mpc a brief to hit an inflation taget that does not include housing costs.

i remember at the end of thatchers reign that she stuck rigidly to meonetarism and used control of money supply to control inflation.

it was enoch powell who correctly in the 1960s concluded that inflation was not due to greedy workers asking for big pay rises, but was government created, by allowoing money supply to increase.

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unfortnately gordon clown has given the " independent " mpc a brief to hit an inflation taget that does not include housing costs.

i remember at the end of thatchers reign that she stuck rigidly to meonetarism and used control of money supply to control inflation.

it was enoch powell who correctly in the 1960s concluded that inflation was not due to greedy workers asking for big pay rises, but was government created, by allowoing money supply to increase.

It was mentined last week that the EU are talking about including Housing costs in CPI now prices are rolling over it is likely Brown will adpt this new EU meaure and Bingo Inflation falls along with house prices :blink:

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No doubt Zorn will appear soon to tell us how if you look back to the neolithic period, you'll find that M0 (spear supply) averaged out at 10% YOY whilst (bone) inflation stayed at 0.1% so everything's hunky dory and house (cave) prices can continue to rise at 20% pa! :rolleyes:

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One would hope that they would take these figures very seriously. CPI just doesn't work.

BoE still has some good honest principled capable employees qualified for their roles - unfortunately I´ve heard they´ll be outsourcing catering services soon as part of Gordon´s plans to reduce the civil service.

Lets face it, if you are bumbling public servant on a base rate mortgage, and own a house (+ odd BTL), are you going to tell your bosses they need to raise interest rates to reduce money supply and reel in that housing/debt bubble? And do you want to be the boss who comes in in the morning and faces scowls from your loyal staff that you´ve just voted for a necessary hike in rates that has an immediate negative impact on their finances?

btp

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It was mentined last week that the EU are talking about including Housing costs in CPI now prices are rolling over it is likely Brown will adpt this new EU meaure and Bingo Inflation falls along with house prices :blink:

Yes, that will be the final "official" confirmation that the housing boom is over!

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No doubt Zorn will appear soon to tell us how if you look back to the neolithic period, you'll find that M0 (spear supply) averaged out at 10% YOY whilst (bone) inflation stayed at 0.1% so everything's hunky dory and house (cave) prices can continue to rise at 20% pa! :rolleyes:

I rather feel we won't be hearing anymore from zorn after he was rumbled as posting from rightmove. Can't say I'll miss him...pr1ck. I new there was something fishy about him...he really got on my tits I can tell you.

back on topic: it wouldn't surprise me in the least if house prices mysteriously found their way back into the basket of goods used to officially measure inflation. Typical GB lying style.

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it was enoch powell who correctly in the 1960s concluded that inflation was not due to greedy workers asking for big pay rises, but was government created, by allowoing money supply to increase.

Pedant mode on.

He worked it out in 1957 along with the two other Treasury Secretaries at the time but he was the only one to stick to the belief afterwards. The idea was already quite well known in academic circles for a while beforehand but just like now, the government never keeps up with current economic thinking.

MattLG

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Pedant mode on.

He worked it out in 1957 along with the two other Treasury Secretaries at the time but he was the only one to stick to the belief afterwards. The idea was already quite well known in academic circles for a while beforehand but just like now, the government never keeps up with current economic thinking.

MattLG

Browns Economic thinking is from the 1700's

Brown gives greenspan The Theory of Moral Sentiments written by Adam Smith in 1759

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I keep forgetting what these M's mean:

  • M0: The total of all coins and banknotes in circulation. (i.e. http://""' target="_blank">M4 money supply (monthly) (4/3) M4 is the broadest measure of the amount of money in the economy. It is the sum of:
    • Money held in notes and coins;
    • The total amount lent by banks, to individuals, companies and other banks;
    • The total amount of money borrowed by the government.

    Monetarists believe that money supply growth is a good predictor of future inflation. However, this correlation has become unreliable since the financial liberalisation of the eighties.

So, with a rise in the money supply above what was expected, this would tend to push towards higher rates as inflation will likely pick up! But, i'm sure the BoE will ignore this. :(

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  • 301 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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