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Inflation

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Manufacturers have been using their cash pile to subsidise their factory goods price. This situation can only go on as long as you have cash in the bank. The true rate of inflation will be felt over the next quarter.

We have had an oil price which has increased 3 fold over a short perion of time and yet inflation has only reached 2.2 % . Ask any household about inflation !! Any government that tells lies about the true state of the home office , immigration ,crimeetc would you then believe them about inflation figures !!

Global interest rates are o the way up and we will have to follow suit. Only advice is to batten down the hatches. Those of us who have sold over the last couple of years well done. My only advice is simple DO NOT BUY !!!

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The way I see it is that if the CPI was the real rate of inflation then all governement provided services would increase exactly in line with it. As it stands things like Council tax is running at at least twice this rate, public transport price increases are also running at twice CPI, and in reality it is even more than that, if for instance you live in the London area you are hammered with congestion charging and increasing parking fines and charges etc etc, this as we all know is just revenue raising to subsidise the shortfall in what it costs to keep on providing the servcies. So if the government cant survive within CPI increases in revenue then what they spout is just pure bullsh*t.

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The way I see it is that if the CPI was the real rate of inflation then all governement provided services would increase exactly in line with it. As it stands things like Council tax is running at at least twice this rate, public transport price increases are also running at twice CPI, and in reality it is even more than that, if for instance you live in the London area you are hammered with congestion charging and increasing parking fines and charges etc etc, this as we all know is just revenue raising to subsidise the shortfall in what it costs to keep on providing the servcies. So if the government cant survive within CPI increases in revenue then what they spout is just pure bullsh*t.

Perhaps if you actually looked at the details of how inflation is calculated, and exactly what is up and what is down, you'd understand. Yes, utility prices are on the up, but a typical household pays much more each month on food and clothing, both of which have seen falls in average prices - OK I don't shop at Asda for clothes, but it's great for kids clothes, and cheaper each year.

I've not actually checked if parking or speeding fines are in the RPI basket, but it's hardly a regular household spend item (unless the household is comprised of idiots, and I guess many are!).

My own council tax at £140pcm is about 20-24% of what I spend at the supermarket (includes petrol) so even the over inflation increase this year (4% I think it was) is less significant overall.

Ultimately we all have a different inflation figure. Public transport, cigarettes, London parking, gas prices, fuel oil etc have no direct effect on me.. Perhaps the cheaper bras have no benefit to you, for example.

The RPI is a long-established method to attempt to measure it, and the basket contents change as spending patterns change. House prices are not in as such though. Imagine if they had been, 1996-2006!

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Clothes can only go down so much.

The basket needs to contain things people NEED or have to pay for.

Oil, electricity, gas, food, housing(buying/renting), council tax, parking, public transport, clothing, tv license.

NOT

mp3 players, plasma tvs, dvds, or anything else electronic that may be getting cheaper.

Inflation is a lie. Why the other political parties or the media aren't jumping on this I don't know!

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here are again some of the tricks being used. its for the american CPI but shouldn't be much different for the UK

Consumer Price Index? Since Jimmy Carter, every administration has messed with it. In order to make it look decent, Alan Greenspan and Michael Boskin, former head of the Council of Economic Advisors, came up with the "substitution" concept. Williams: "The whole purpose of the CPI [was] to measure the change in the cost of a fixed basket of goods over time ... What Boskin and Greenspan argued was, 'We should allow for substitution because people can buy hamburger instead of steak when steak goes up.' The problem is that if you allow substitutions, you aren't measuring a constant standard of living. You're measuring the cost of survival."

Who gets squeezed by this? Fixed-income people. "The difference that it makes is significant: if the same CPI were used today as [under Carter], Social Security checks would be 70% higher."

An adjunct to substitution is "weighting," adopted under Clinton, whereby the Bureau of Labor Statistics changed from a straightforward arithmetic to a reality-challenged geometric method, a move Williams calls "a pure mathematical game." The gist of the change is this: now, if something goes up in price, it gets a lower weighting in the CPI, and vice versa. Voilà. Down comes inflation.

There's also hedonics. Simply summarized, this means that if a product is "improved," then it is deemed to have come down in price, even if you're paying more for it.

we could open also a thread about the GDP scam :P

Yet "manipulations of the CPI ... pale next to the impact of imputations in the GDP

http://www.itulip.com/forums/archive/index.php?t-14.html

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Why the other political parties or the media aren't jumping on this I don't know!

Expect the Tories to start to attack the government on Brown's handling of the economy soon.

They've been in a difficult position, in that until Cameron took over, no-one would listen to what they have to say. They now have the voter's lead over Labour on all issues, NHS, sleaze, crime etc, and are almost at level pegging on economy. They can only start to attack when people are prepared to listen. That time is approaching fast

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Clothes can only go down so much.

The basket needs to contain things people NEED or have to pay for.

Oil, electricity, gas, food, housing(buying/renting), council tax, parking, public transport, clothing, tv license.

NOT

mp3 players, plasma tvs, dvds, or anything else electronic that may be getting cheaper.

Inflation is a lie. Why the other political parties or the media aren't jumping on this I don't know!

Could not agree more !! Gov tells lies about Iraq , Criminals being let loose, real cost of the two conflicts , so why do we trust them on inflation. Batten down the hatches and if you have cash there are going to be bargains as there were after the 90s

Interesting. Can you provide a link to more information about this?

This is a general statement ( mentioned by many economic journals)as when you have cash (cash is king ) you do not need the bank and you can effectivly stave off the day when you need to increase your factory prices . Companies now are in a competitive market and those who are cash rich can survive. When you have no cash surplus you have to go to the bank and pay interest which must reflect on the price of you produced goods thereby increasing inflation. This is ofcourse only one way that inflation increases. We are now in this phase as inflation is certainly on the way up and the pendulum will have to go a long way before it comes back , history again wil confirm.

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Clothes can only go down so much.

The basket needs to contain things people NEED or have to pay for.

Oil, electricity, gas, food, housing(buying/renting), council tax, parking, public transport, clothing, tv license.

NOT

mp3 players, plasma tvs, dvds, or anything else electronic that may be getting cheaper.

Inflation is a lie. Why the other political parties or the media aren't jumping on this I don't know!

CPI moves at about the same pace as RPI, so it's a fair measure. CPI target of 2% or RPI of 3%, it makes no difference to the effect on IRs

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The Tories have been attacking Brown's economic record for absolute ages. The problem is that, superficially at least, the economy has been doing very well.

So when a tory goes on about Labour ruining the economy every one looks around them, thinks "nope", the tories are full of shiat LALALA IM NOT LISTENING!

Only when people start to feel the squeeze will they begin to realise that Brown is not the Miracle Man. People are beginning to feel the squeeze.

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The Tories have been attacking Brown's economic record for absolute ages. The problem is that, superficially at least, the economy has been doing very well.

So when a tory goes on about Labour ruining the economy every one looks around them, thinks "nope", the tories are full of shiat LALALA IM NOT LISTENING!

Only when people start to feel the squeeze will they begin to realise that Brown is not the Miracle Man. People are beginning to feel the squeeze.

Very true but that day is not far away . I dont think there has been a time for a long period that a general concensus amongst home and foreign banking institutions are saying that interest rates have to rise. The timing is bad for Brown as he must have thougt he would be in No 10 when the house of cards then will fall but blair wants to stay , then he will leave Brown with a mess and lose the next election . Governments only worry about elctions not you and I who are trying to buy or keep a home.

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Manufacturers have been using their cash pile to subsidise their factory goods price. This situation can only go on as long as you have cash in the bank. The true rate of inflation will be felt over the next quarter.

We have had an oil price which has increased 3 fold over a short perion of time and yet inflation has only reached 2.2 % . Ask any household about inflation !! Any government that tells lies about the true state of the home office , immigration ,crimeetc would you then believe them about inflation figures !!

Global interest rates are o the way up and we will have to follow suit. Only advice is to batten down the hatches. Those of us who have sold over the last couple of years well done. My only advice is simple DO NOT BUY !!!

Dangerous advice. Do not buy what? Everything?

This government has you well watched. I'd be very careful about questioning their figures in public.

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Very true but that day is not far away . I dont think there has been a time for a long period that a general concensus amongst home and foreign banking institutions are saying that interest rates have to rise. The timing is bad for Brown as he must have thougt he would be in No 10 when the house of cards then will fall but blair wants to stay , then he will leave Brown with a mess and lose the next election . Governments only worry about elctions not you and I who are trying to buy or keep a home.

inflation is basically a myth........this finance stuff is a zero sum game.

the last 15 years,anglo-saxon consumers helped keep the global economy ticking along while the likes of germany and japan went down the toilet.

this little exercise is merely redressing the balance,us consumer types are just going to get used to much higher prices for everything,or be clobbered by higher IR's/taxes/both.

the rest of the world is playing catch-up,and those with a technological advantage(enabling more to be done with less) will benefit.

problem is,our education system is more focused on peoples problems now.......meaning we have given up competing and are going to reap the whirlwind,with a few sore losers on the way.

PLC's won't have a problem,they have sown the seeds of new and vibrant future markets......the anglo-saxon consumer is going to be left with nothing apart from a few sessions of therapy....now do you see why all those psychology degrees are going to come in handy??

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Dangerous advice. Do not buy what? Everything?

This government has you well watched. I'd be very careful about questioning their figures in public.

This advice of not to buy property at todays levels came from the Bank of England about 6 months ago . If you search on Google or Yahoo finance you will find the Quote !!

It is his get out clause when it all goes wrong and he can then say I told you so.

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The reason behind the infaltion 'lies' (i prefer to use the word smudged,not fudged as I'm personally unsure as to whether it's beneficial) as they have been described may well be for better intentions and the 'lie' is probably aimed at other markets other than housing. Brown and the Labour government has constantly harped on about the long term STABILITY of the British economy rather than the OVERALL PERFORMANCE in a bid to encourage long term investment . However , the economy , as is being regularly reported , is under threat from the growing economies of India and China which previously has helped keep inflation low by supplying cheap labour/goods have reached a point where our 'stability' no longer provides the advantage that it once did to investors . One thing is for certain , a recession is on its way so tighten your belts . (sorry about stating the obvious but I'm sure this is the real reason for smudging inflation figures)

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That's how the traditional pre Clinton Era Cpi with a fixed basket would look like today (blue line)

The official CPI-U shows the effect of geometrical weighting and is ca 2.7 % lower.

the experimental C-CPI-U uses substitution, The C-CPI-U would not have been introduced unless there were plans to replace the current series, eventually.

Wanna lower social security checks by 43%? just remodel the CPI :lol:

chartSGS01-16.gif

http://www.shadowstats.com/

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"Just Gimme the Truth " JL

INFLATION PSYCHOLOGY is coming back too

=======

Why the real rate of inflation is twice what the official figures tell us

Rises in bills that have to be paid come what may hurt more than rises in luxury items

By Philip Thornton, Economics Correspondent

Published: 13 June 2006

Official figures later this morning are expected to reveal that inflation rose to 2.1 per cent from 2.0 per cent last month. While this will create huge excitement among City traders betting on the next move in interest rates, it will leave millions of ordinary people scratching their heads in bewilderment. Perhaps with good reason.

...an index devised by The Independent, and published today, appears to back that notion. The index strips out items that are not essential to a basic standard of living. Thus we have taken out leisure goods and services, household services, personal goods, buying a car, tobacco and alcohol. Our index is dominated by the cost of running a home, paying for the public utilities, keeping a car on the road and basic items such as clothing, furniture and chemists goods. It is open to criticism - why include the cost of running a car but not buying it? - but it attempts to isolate areas of inflation that irk people.

While the official inflation rate the Bank of England uses to set interest rates has been below 2 per cent for 20 out of the past 28 months, our index has been above 4 per cent for 17 of those months, and higher than 5 per cent for five.

In other words non-discretionary inflation is running at about twice the targeted one - and in October 2004 showed an annual rise of 5.3 per cent, more than four times the official measure of 1.2 per cent.

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"Just Gimme the Truth " JL

INFLATION PSYCHOLOGY is coming back too

=======

Why the real rate of inflation is twice what the official figures tell us

Rises in bills that have to be paid come what may hurt more than rises in luxury items

By Philip Thornton, Economics Correspondent

Published: 13 June 2006

Official figures later this morning are expected to reveal that inflation rose to 2.1 per cent from 2.0 per cent last month. While this will create huge excitement among City traders betting on the next move in interest rates, it will leave millions of ordinary people scratching their heads in bewilderment. Perhaps with good reason.

...an index devised by The Independent, and published today, appears to back that notion. The index strips out items that are not essential to a basic standard of living. Thus we have taken out leisure goods and services, household services, personal goods, buying a car, tobacco and alcohol. Our index is dominated by the cost of running a home, paying for the public utilities, keeping a car on the road and basic items such as clothing, furniture and chemists goods. It is open to criticism - why include the cost of running a car but not buying it? - but it attempts to isolate areas of inflation that irk people.

While the official inflation rate the Bank of England uses to set interest rates has been below 2 per cent for 20 out of the past 28 months, our index has been above 4 per cent for 17 of those months, and higher than 5 per cent for five.

In other words non-discretionary inflation is running at about twice the targeted one - and in October 2004 showed an annual rise of 5.3 per cent, more than four times the official measure of 1.2 per cent.

Brown cannot hide this !!

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Just got my car insurance renewal quote. My circumstances haven't changed at all (excpet I've got another years NCB, but I'm already at full). Price has increased by approx 19% - good to see there is no inflation.....

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Just got my car insurance renewal quote. My circumstances haven't changed at all (excpet I've got another years NCB, but I'm already at full). Price has increased by approx 19% - good to see there is no inflation.....

dpg50000, stop moaning! You don't NEED car insurance like you need mp3 players and LCD TVs that are coming down in price.

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dpg50000, stop moaning! You don't NEED car insurance like you need mp3 players and LCD TVs that are coming down in price.

I think you missed his point, he's pointing out that insurance is rising in cost despite no other circumstances changing, there by giving the reason for the increase being mainly inflation alone, rather than him actually moaning about the cost of insurance.

Think lateral rather than comical.

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I think you missed his point, he's pointing out that insurance is rising in cost despite no other circumstances changing, there by giving the reason for the increase being mainly inflation alone, rather than him actually moaning about the cost of insurance.

Think lateral rather than comical.

I very much doubt that they've increased premiums by 19% across the board, just because of inflation. If they did then they would go out of business because other car insurers have increased their premiums by much lower percentages.

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I think you missed his point, he's pointing out that insurance is rising in cost despite no other circumstances changing, there by giving the reason for the increase being mainly inflation alone, rather than him actually moaning about the cost of insurance.

Think lateral rather than comical.

I was being sarcastic! :rolleyes: I'd be flaming furious if my insurance went up 19% for no reason!

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I was being sarcastic! :rolleyes: I'd be flaming furious if my insurance went up 19% for no reason!

Actually, what I suspect is that are banking on customer inertia to rake in the big bucks (and to subsidise winning new business). In fact, I pretty much confirmed the latter - I asked next door to get an online quote using the exact same details as me, but obviously next door's address - result was a quote of approx 25% less than my renewal quote......

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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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