Jump to content
House Price Crash Forum
Sign in to follow this  
Fancypants

As Realist Bear Is Not Around, May I Be The First To Say

Recommended Posts

carry trade in West Yorkshire at risk?

"Pakistan has announced a surprise interest rate increase of half a percentage point as higher oil and commodity prices feed inflation.

The State Bank of Pakistan said that its main borrowing cost will rise to 9.5% from 9% on Monday.

It is the first time interest rates have risen in 15 months.

Pakistan is South Asia's second-largest economy and its rapid rate of growth, coupled with high energy prices, are proving a concern for many observers.

The central bank wants to slow the annual inflation rate to 6.5% in the year running to 30 June, 2007. In the previous 12 months, it was 7.9%.

"I personally am feeling quite confident that we should be able to contain inflationary pressures with this rise," said central bank governor Shamshad Akhtar.

However, the bank said it would remain vigilant, hinting that there could be more rate increases should the inflation rate not slow.

Analysts said that the higher interest rates were unlikely to slow the economy and they remained confident that Pakistan would still hit its growth target of 7% for the current fiscal year."

Edited by Fancypants

Share this post


Link to post
Share on other sites

I bought some Tee shirts the other day for kids at my son's birthday party to wear to show which team they were in. They were £1 each.

To be honest I don't know where they came from but Pakistan makes a lot of cheap textiles. If they're £1 in Tescos I wonder what they are to buy in Pakistan - 50p? less?

Even at 50p and with 10% inflation a year in Pakistan - pushing the price of the Tee shirts up to 55p - well it's not exactly going to cause inflation here - is it?

If you're hanging your hat on inflation in Asia causing inflation here ....

If you're hanging your hat on higher interest rates here with America's growth slowing and an end to their rising cycle in sight ...

What else have you got to hang your hat on? Change in sentiment?

Share this post


Link to post
Share on other sites

I bought some Tee shirts the other day for kids at my son's birthday party to wear to show which team they were in. They were £1 each.

To be honest I don't know where they came from but Pakistan makes a lot of cheap textiles. If they're £1 in Tescos I wonder what they are to buy in Pakistan - 50p? less?

Even at 50p and with 10% inflation a year in Pakistan - pushing the price of the Tee shirts up to 55p - well it's not exactly going to cause inflation here - is it?

If you're hanging your hat on inflation in Asia causing inflation here ....

If you're hanging your hat on higher interest rates here with America's growth slowing and an end to their rising cycle in sight ...

What else have you got to hang your hat on? Change in sentiment?

But if the price of cheap Eastern goods merely stops falling then it will have a huge effect on our inflation figures. It is only the declining price of this cheap tat that is keeping our supposed inflation rate at 2%.

Share this post


Link to post
Share on other sites

I bought some Tee shirts the other day for kids at my son's birthday party to wear to show which team they were in. They were £1 each.

To be honest I don't know where they came from but Pakistan makes a lot of cheap textiles. If they're £1 in Tescos I wonder what they are to buy in Pakistan - 50p? less?

Even at 50p and with 10% inflation a year in Pakistan - pushing the price of the Tee shirts up to 55p - well it's not exactly going to cause inflation here - is it?

If you're hanging your hat on inflation in Asia causing inflation here ....

If you're hanging your hat on higher interest rates here with America's growth slowing and an end to their rising cycle in sight ...

What else have you got to hang your hat on? Change in sentiment?

I don't even own a hat! :unsure:

Share this post


Link to post
Share on other sites
But if the price of cheap Eastern goods merely stops falling then it will have a huge effect on our inflation figures. It is only the declining price of this cheap tat that is keeping our supposed inflation rate at 2%.

And 10% inflation on imported goods is 10% inflation. It doesn't matter in the least whether the price goes up 10p or 10 pounds, what matters is the average _percentage_ increase.

The simple fact is that inflation has been 'low' for years because the Chinese exported deflation to us. If they start exporting inflation instead, we're ******ed.

Share this post


Link to post
Share on other sites

And 10% inflation on imported goods is 10% inflation. It doesn't matter in the least whether the price goes up 10p or 10 pounds, what matters is the average _percentage_ increase.

The simple fact is that inflation has been 'low' for years because the Chinese exported deflation to us. If they start exporting inflation instead, we're ******ed.

That's the point, but most people can't get their head round it. The thing is though, inflation is greatest in the housing market (or it was till prices started stalling) but house prices are not included in Gordon Brown's CPI or RPI measures of inflation. People are being sold a lie. So he hails a low inflation economy. The end of boom and bust. Ignoring the biggest inflationary bubble in history! Yet people seem to accept it. People seem ontent to live on low wages even though inflation has gone through the roof. Why? Perhaps because people think they are rich because their house is worth gazillions. Trouble is it will all end in tears.

Share this post


Link to post
Share on other sites

That's the point, but most people can't get their head round it. The thing is though, inflation is greatest in the housing market (or it was till prices started stalling) but house prices are not included in Gordon Brown's CPI or RPI measures of inflation. People are being sold a lie. So he hails a low inflation economy. The end of boom and bust. Ignoring the biggest inflationary bubble in history! Yet people seem to accept it. People seem ontent to live on low wages even though inflation has gone through the roof. Why? Perhaps because people think they are rich because their house is worth gazillions. Trouble is it will all end in tears.

Its scary to even consider what CPI might be if houses were included with a fair weighting factor.

I also saw someone mention that petrol is included but without the tax element? If that's true then thats another corker from GB. (can anyone confirm this?)

Share this post


Link to post
Share on other sites

I own an import company and I will tell you that on average the cost of importing goods from China and India has gone up 5% over the last few months. Suppliers in those countries are burdened with higher raw material, fuel, energy and labor costs - what choice do they have - they are starting to pass it on. So this argument in the press about cheap imports keeping inflation down is very short sighted - in fact out dated argument as far as i can observe in my day to day interactions with factories in the countries they are referring to.

Share this post


Link to post
Share on other sites

As IR soar up up and away in the world's largest economies Gordon's own Miracle Economy now stands alone with Moldavia in ignoring inflation and keeping rates accomodative:

http://www.dawn.com/2006/07/31/ebr12.htm

WITH inflationary worries still haunting the federal government, the
Reserve Bank of India
(RBI), the country’s central bank, last week once again decided to go in for a hike in a key interest rate.
In line with interest rate hikes carried out by central banks elsewhere in the world over the past few weeks
, the RBI pushed ahead with what it described as “a modest pre-emptive action.” The bank raised the benchmark short-term rate by a quarter point to six per cent, a four-year high.

Is the UK economy strong enough and inflation free enough to go it alone in a world where IR hiking frenzies are building?

Share this post


Link to post
Share on other sites

That's the point, but most people can't get their head round it. The thing is though, inflation is greatest in the housing market (or it was till prices started stalling) but house prices are not included in Gordon Brown's CPI or RPI measures of inflation. People are being sold a lie. So he hails a low inflation economy. The end of boom and bust. Ignoring the biggest inflationary bubble in history! Yet people seem to accept it. People seem ontent to live on low wages even though inflation has gone through the roof. Why? Perhaps because people think they are rich because their house is worth gazillions. Trouble is it will all end in tears.

According to APOM, it's a good thing that house prices aren't included in the CPI. He thinks they've fallen, so if they were included, CPI would be about minus 5%, and IRs would need to be reduced to about 0.25%

Share this post


Link to post
Share on other sites

According to APOM, it's a good thing that house prices aren't included in the CPI. He thinks they've fallen, so if they were included, CPI would be about minus 5%, and IRs would need to be reduced to about 0.25%

Er, no. If they were included IRs would have risen a long time ago!

Share this post


Link to post
Share on other sites

And 10% inflation on imported goods is 10% inflation. It doesn't matter in the least whether the price goes up 10p or 10 pounds, what matters is the average _percentage_ increase.

The simple fact is that inflation has been 'low' for years because the Chinese exported deflation to us. If they start exporting inflation instead, we're ******ed.

They will. Even because China starts protect its natural enviroment - it means much higher costs of production. Huge wage pressure occured as well in many Asian economies.

Share this post


Link to post
Share on other sites

I own an import company and I will tell you that on average the cost of importing goods from China and India has gone up 5% over the last few months. Suppliers in those countries are burdened with higher raw material, fuel, energy and labor costs - what choice do they have - they are starting to pass it on. So this argument in the press about cheap imports keeping inflation down is very short sighted - in fact out dated argument as far as i can observe in my day to day interactions with factories in the countries they are referring to.

You are absolutely right, I have noticed the same thing with my imports from suppliers out of the far east. First you absorb the cost then you make some personel redundant then I am outsourcing webdesign and customer services to low cost countries. All these things have not helped UK employment and eventually I may have to raise prices which is very hard to do in my area.

:(

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.