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uk inflation at 0.2% - cover for more QE?


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The BBC (quoting ONS) are reporting UK inflation at 0.2% for August: https://www.bbc.co.uk/news/uk-54173658 

 

Given that the "target" is 2%, how will they achieve this in the near term future (I know they always miss..)?

This might well be used as cover for a lot of printing, because someone has to pay for all those bounce back loans and furlough wages (savers, as always), but if things get really bad they might even post cheques out to everyone in the UK (ala the 'Trump cheque').

 

My personal suspicion/opinion is that the printers are currently having their ink cartridges replaced, and the helicopters are being refuelled.

We have a reasonable amount of savings at the moment (almost nothing compared to some on here), but I'm getting a bit worried about how to protect them if I'm honest - the stock market looks ropey, cash will be trashed etc, property except main residence - just no.

 

Interesting times.

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42 minutes ago, definitelynotanagent said:

The BBC (quoting ONS) are reporting UK inflation at 0.2% for August: https://www.bbc.co.uk/news/uk-54173658 

 

Given that the "target" is 2%, how will they achieve this in the near term future (I know they always miss..)?

This might well be used as cover for a lot of printing, because someone has to pay for all those bounce back loans and furlough wages (savers, as always), but if things get really bad they might even post cheques out to everyone in the UK (ala the 'Trump cheque').

 

My personal suspicion/opinion is that the printers are currently having their ink cartridges replaced, and the helicopters are being refuelled.

We have a reasonable amount of savings at the moment (almost nothing compared to some on here), but I'm getting a bit worried about how to protect them if I'm honest - the stock market looks ropey, cash will be trashed etc, property except main residence - just no.

 

Interesting times.

So deflation is a real concern and even without it they would do the printy printy dance.  My bet is a 10k cheque lo all those who lost their job since the start of the pandemic.  They can then use that money to fund the continuation of their lifestyle of being a growing part of the McDonalds queue.  The money will be paid for by taxing those who rush past thinking “who has time to sit in the queue for McDonald’s”. 

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1 hour ago, rantnrave said:

Small print says its all down to Eat Out to Help Gout, reduced airfares 'cos no-one's flying and no hike in autumn clothes prices due to shops struggling.

How can it be in reality 0.2%..... only because of temporary reductions to get people spending again as you say....clothes have been no reason to dress up, nowhere to go......a glut of clothing. 

Inflation will rise especially with services, imported inflation on goods/food because of the low pound and if no deal, possible tariffs in the pipeline.

Inflation will rise because of the extra costs business have had in dealing with and providing for CoVid and brexit...

So now is the time to buy what require today for tomorrow at today's price.....alternatively help reduce own inflation by spending less on discretionary purchases, doing more, learning how to do more, sharing more and shopping around.;)

 

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2 hours ago, rantnrave said:

Small print says its all down to Eat Out to Help Gout, reduced airfares 'cos no-one's flying and no hike in autumn clothes prices due to shops struggling.

Yes, it's total ********.  House prices up and everything I look at on line looks to be subject to a 20% increase in price !!!

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23 minutes ago, captainb said:

I thought inflation was going to the moon...!!!! 

Sold all assets and bought gold coins to barter with for goats as per advice from some on here.. 

Was that actually just nonsense? 

Ouch, I bought a house contra to advice from this site back in 2017. Bagged a relative bargain given the Brexit uncertainty and the mortgage on the place (detached, three beds, log burner and huge garden in a market town) was only £300/month more than the small two bed flat on a main road I'd been renting. 

My view is gold is nonsense - total BS asset class.

8 minutes ago, TheCountOfNowhere said:

Yes, it's total ********.  House prices up and everything I look at on line looks to be subject to a 20% increase in price !!!

Yep and the BoE is managing expectations for ZIRP and more printy printy. At zero rates something daft happens to income yielding assets' valuation, it goes to infinity. 

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3 minutes ago, Unmoderated said:

Yep and the BoE is managing expectations for ZIRP and more printy printy. At zero rates something daft happens to income yielding assets' valuation, it goes to infinity. 

Good luck finding a buyer at infinity x wages 

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31 minutes ago, captainb said:

I thought inflation was going to the moon...!!!! 

Sold all assets and bought gold coins to barter with for goats as per advice from some on here.. 

Was that actually just nonsense? 

If you call the value of your gold coins going up by about a third in the last six months "nonsense", then yes.

 

 

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1 minute ago, Gigantic Purple Slug said:

If you call the value of your gold coins going up by about a third in the last six months "nonsense", then yes.

 

 

Sadly i didn't trade with hindsight looking at the graph picking the lows and selling the highs.

Then the storage and insurance for this metal.... but will all be worth it once the currency totally collapses through all this inflation.

It wasnt mentioned that half price curry club at weatherspoons could de-rail the hyperinflation though? Hmmmm.... is it still certain. 

I

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6 minutes ago, TheCountOfNowhere said:

Good luck finding a buyer at infinity x wages 

True that, and I don't expect the actual commercial borrowing rate to hit zero but it might get close. I could shave 0.55% off my mortgage if I remortgaged today and that's at last year's valuation. Who know what the LTV and rates will be next year when I come to do it but I think it'll be cheaper for a lot of people. 

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2 minutes ago, captainb said:

Sadly i didn't trade with hindsight looking at the graph picking the lows and selling the highs.

Then the storage and insurance for this metal.... but will all be worth it once the currency totally collapses through all this inflation.

It wasnt mentioned that half price curry club at weatherspoons could de-rail the hyperinflation though? Hmmmm.... is it still certain. 

I

If we get ZIRP go for income generating investments, businesses that return money to shareholders with good historic dividends. Boring stuff like insurance, utilities etc. 

I have spent many years working in wealth management and never ever have I or my colleagues understood the point of gold as part of a portfolio. It's peddled by survivalists and people trying to sell you gold. What other asset class can you buy from a vending machine?!

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2 minutes ago, Unmoderated said:

If we get ZIRP go for income generating investments, businesses that return money to shareholders with good historic dividends. Boring stuff like insurance, utilities etc. 

I have spent many years working in wealth management and never ever have I or my colleagues understood the point of gold as part of a portfolio. It's peddled by survivalists and people trying to sell you gold. What other asset class can you buy from a vending machine?!

No agreed, was on a moderate wind up. Find it scary how some people peddle this hyperinflation through QE despite the complete lack of it post 2008. For those that dont know the big picture its dangerous as they might actually take the advice on from these snake oil salesmen... then be shocked when inflation is below 2% for the next few years.

In the real world, hold boring things like warehouse reits that return 5% and have 30 year rented sheds to amazon, tesco and co. Also hold some fundsmith and nick train - they are better at stock picking than i am so happy to give the fee. 

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7 minutes ago, Unmoderated said:

If we get ZIRP go for income generating investments, businesses that return money to shareholders with good historic dividends. Boring stuff like insurance, utilities etc. 

I have spent many years working in wealth management and never ever have I or my colleagues understood the point of gold as part of a portfolio. It's peddled by survivalists and people trying to sell you gold. What other asset class can you buy from a vending machine?!

Obviously there is a lot to discuss about the merits of investing in gold.

Some investment managers have a preference for it, some don't.  I don't have a problem with that.

However, for me personally any "wealth manager" who didn't understand or appreciate the role of gold in investment wouldn't be a wealth manger of mine.

 

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11 minutes ago, Unmoderated said:

If we get ZIRP go for income generating investments, businesses that return money to shareholders with good historic dividends. Boring stuff like insurance, utilities etc. 

I have spent many years working in wealth management and never ever have I or my colleagues understood the point of gold as part of a portfolio. It's peddled by survivalists and people trying to sell you gold. What other asset class can you buy from a vending machine?!

Gold accounts for about 3-4% of my wife and I's portfolio and has done very well thank you. So have the five limited run motorcycles I bought off plan as it were making over a year about £2k on each with no tax

A portfolio isn't restricted to something you can just see  on a screen

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6 minutes ago, GregBowman said:

Gold accounts for about 3-4% of my wife and I's portfolio a

yeah, my gold is nearly doubled recently.

Not having a go at you Greg as I hate the spelling and grammar police, I am just interested to know as I genuinely don't know the answer but is that the right grammatical use of "my wife and I" ?

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13 minutes ago, Gigantic Purple Slug said:

Obviously there is a lot to discuss about the merits of investing in gold.

Some investment managers have a preference for it, some don't.  I don't have a problem with that.

However, for me personally any "wealth manager" who didn't understand or appreciate the role of gold in investment wouldn't be a wealth manger of mine.

 

Invested a loads of things.

I used to invest heavily in woman and beer, the rest of my income with just squandered.

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It’s a bit of a nonsense saying inflation was 0.2% based on the price of COVID burgers if they are not factoring in what the actual bill cost, I suspect there is a bit of slight of hand and they are calculating it based on the bit the customer paid.  No doubt we will see more of this.

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26 minutes ago, TheCountOfNowhere said:

Invested a loads of things.

I used to invest heavily in woman and beer, the rest of my income with just squandered.

Good point,what is the point in investing carefully into an income when then just go and enjoy squandering it.

Lots do it.....they earned it, up to them how they spend/squander it.

 

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1 hour ago, Unmoderated said:

I have spent many years working in wealth management and never ever have I or my colleagues understood the point of gold as part of a portfolio. It's peddled by survivalists and people trying to sell you gold. What other asset class can you buy from a vending machine?!

If you'd asked this back in March I'd have said Uncle Bens rice and bottled water. 

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2 hours ago, TheCountOfNowhere said:

yeah, my gold is nearly doubled recently.

Not having a go at you Greg as I hate the spelling and grammar police, I am just interested to know as I genuinely don't know the answer but is that the right grammatical use of "my wife and I" ?

probably not and I will take it from you 😉 

I don't know either- I am sure some clever people will help us !

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5 hours ago, satsuma said:

So deflation is a real concern and even without it they would do the printy printy dance.  My bet is a 10k cheque lo all those who lost their job since the start of the pandemic.  They can then use that money to fund the continuation of their lifestyle of being a growing part of the McDonalds queue.  The money will be paid for by taxing those who rush past thinking “who has time to sit in the queue for McDonald’s”. 

Eurozone is already in deflation is it not?

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  • 418 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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