In The Real World, What's Inflation Running At ?

[Rachman]

Vehicle Fuel is up about 8% in a year (already taxed at 300%ish)

Domestic fuel up 90% in three years

taxation (indirect) up by lots

Fiscal drag

council tax

My guess is somewhere around 8% allowing for the falling cost of Chinese imports, taking that out, the core things we actually need and pay for, nearer 12% - which is 6 times that they are pretending to talk about.

[munimula]

Vehicle Fuel is up about 8% in a year (already taxed at 300%ish)

Domestic fuel up 90% in three years

taxation (indirect) up by lots

Fiscal drag

council tax

My guess is somewhere around 8% allowing for the falling cost of Chinese imports, taking that out, the core things we actually need and pay for, nearer 12% - which is 6 times that they are pretending to talk about.

Everyone's inflation rate is different.

For example - pensioners - exposed to rising energy costs but don't buy consumer goods - inflation is much higher than official CPI

However, someone buying every new consumer good that comes out - their inflation rate is probably below the official CPI figure.

For the average person it is probably considerably higher than 2.5% though

[MEtallic]

Swimming pool session just gone up from £3 to £3.50. 17%. I don't know when the last time they raised prices was though.

Water melons £3.50 last year, £4.25 this summer, up 21%.

Co-op orange 3 for the price of 2, up to £2.30 from £2. 15%

Pay rise? 4% !!

Of course there's no inflation!!!

[Bingley Bloke]

Different people have different situations, so I reckon 12-18%

My outgoings have increased by 16.2% year on year for the last three years. That's even when factoring in cutting out many non-essentials and buying cheaper versions of things I can't avoid, such as food items. If I'd not made changes to my expenditure the figure would be even higher.

When unavoidable expenses rise significantly you have to cut back on non-essentials and as such the unavoidable costs become more heavily weighted within the household budget while the non-essentials become less heavily weighted. Not surprisingly the government reflects this in the exact opposite to the appropriate way and has significantly increased the weightings in the CPI basket given to stagnating and falling avoidable costs such as new cars, while significantly decreasing the weightings given to soaring unavoidable costs, such as energy bills.

[jp1]

Different people have different situations, so I reckon 12-18%

My outgoings have increased by 16.2% year on year for the last three years. That's even when factoring in cutting out many non-essentials and buying cheaper versions of things I can't avoid, such as food items. If I'd not made changes to my expenditure the figure would be even higher.

When unavoidable expenses rise significantly you have to cut back on non-essentials and as such the unavoidable costs become more heavily weighted within the household budget while the non-essentials become less heavily weighted. Not surprisingly the government reflects this in the exact opposite to the appropriate way and has significantly increased the weightings in the CPI basket given to stagnating and falling avoidable costs such as new cars, while significantly decreasing the weightings given to soaring unavoidable costs, such as energy bills.

Id say on "average" in UK - its about 8 - 9%

[AteMoose]

count yourself lucky... payrises have been 2% a year for years at my place... Payrises are inline with 'inflation'

Edited August 3, 2006 by moosetea

[Rachman]

Even Tesco are putting up prices on staples. I noticed their orange juice offer is now 3litres for £2.20 up from £2.00 - and that's allowing for crucifying foreign suppliers.

My train ticket is up 20% in two years, my car tax went up by 10% this year, the cost of everything is rocketing and you are getting less public services for the same money - e.g. fortnightly rubbish but you pay for 'weekly'..... they are out of control and Brown's fiddling while Britain burns....

[OzzMosiz]

TV license has gone up. EVERYONE with a TV has to pay for that every year. I believe it went up ~12% and was

removed from the CPI basket before the rise was implemented.

The cheap imports from China can't continue forever!

[Rachman]

TV license has gone up. EVERYONE with a TV has to pay for that every year. I believe it went up ~12% and was

removed from the CPI basket before the rise was implemented.

The cheap imports from China can't continue forever!

If Western consumer spending stops, who are the Chinese going to sell to ? That could scupper their expansion as the other developing world countries would find themselves more than a bit strapped too as their exports would fall and I don't think the Chinese have planned for a downmarket - their reponse may be to go acquire markets...... after all they can muster a pretty big army....

[munimula]

count yourself lucky... payrises have been 2% a year for years at my place... Payrises are inline with 'inflation'

Same with the company I work for.

Pay reviews are now every 2 years and the aveage over the last 4-5 years is about 2-3% pa

Effectively it's a real world pay cut every year.

But I don't think we can expect much more until the east catches up with the west. We are already uncompetitive.

Even Tesco are putting up prices on staples. I noticed their orange juice offer is now 3litres for £2.20 up from £2.00 - and that's allowing for crucifying foreign suppliers.

My train ticket is up 20% in two years, my car tax went up by 10% this year, the cost of everything is rocketing and you are getting less public services for the same money - e.g. fortnightly rubbish but you pay for 'weekly'..... they are out of control and Brown's fiddling while Britain burns....

my car tax went down about 45% as I bought a more environmentally friendly car.

The cheap imports from China can't continue forever!

it's hard to say but I think there is growing evidence that prices are no longer going down like they were

[Rachman]

my car tax went down about 45% as I bought a more environmentally friendly car.

But that's not inflation - that's like saying your tax bill went down because you took a lower paid job....

and if you want to go green, drive an old dirtier car, none of them use up the energy being driven they take to produce. The Prius is probably the most environmentally unfriendly car out there - worse than a Ferrari or a belching Transit, simply because it uses up so much energy to be made..... - but the Greenies don't want you to hear that... instead they waffle on about small engines being better, about how diesel is good because it's more economical (and much much dirtier)....

[munimula]

But that's not inflation

Inflation is different for everybody.

As I changed cars and now pay less for my car tax then my experience of inflation is not the same as someone who hasn't and is now paying 10% more.

[Ignorant Steve]

The only inflation BofE are really worried about are inflationary pay rises.

Only when pay increases start to reflect the increasing costs will they act.

[gasket37]

But that's not inflation - that's like saying your tax bill went down because you took a lower paid job....

and if you want to go green, drive an old dirtier car, none of them use up the energy being driven they take to produce. The Prius is probably the most environmentally unfriendly car out there - worse than a Ferrari or a belching Transit, simply because it uses up so much energy to be made..... - but the Greenies don't want you to hear that... instead they waffle on about small engines being better, about how diesel is good because it's more economical (and much much dirtier)....

have to agree with this one

old bangers make perfect sense - get something that is reliable on a day to day basis and spend a bit on servicing each year at a good independant local garage.

the overall environmental impact of the car is reduced as it is used for a longer period and local skills are maintained by servicing it rather than "employing" someone on a production line to build a new one...

[Rachman]

Inflation is different for everybody.

As I changed cars and now pay less for my car tax then my experience of inflation is not the same as someone who hasn't and is now paying 10% more.

That's the CPI argument - we'll change what's in there to suit.

My day to day driver is a 2.0 car that does 44mpg on the motorway and averages 35 overall... the tax went up from £165 to £195 - apparently it's a gas guzzling monster when it's actually more economical to run than the missus' band D car on a motorway run (for which the tax went up more than 10% this year).... - inflation is what people pay for the things they use, but you have to adjust it to reflect your changed usage, or you have to rebase it and start again, which is what they want you to do. Plus the lowest tax bracket he made a song and dance about only has the Honda Insight, Civic IMA and Prius in it - which sold less than sod all a year in the UK and are basically useless compared to a normal car for anything approaching a decent run - the weight they pull around in batteries more than offsets the adavantage of them at any sort of speed - they are only any good round town....

[?...!]

Wait and watch the US retail sector.

The only thing subduing inflation is cheap imports. When US consumers stop buying goods people will stop making them, and economies of scale dictates that production costs will increase per unit produced, this will show up in inflation data.

A US consumer retration will precede a global recession, as the price of all goods will trend upwards leading to higher rates.

I'm not sure what inflation is running at for me, but 18 months ago I could invest 25% of my earnings and now I can only invest 10%, during this time my wages increased 2.5% and my standard of living remains the same.

[FreeFall]

Swimming pool session just gone up from £3 to £3.50. 17%. I don't know when the last time they raised prices was though.

Water melons £3.50 last year, £4.25 this summer, up 21%.

Co-op orange 3 for the price of 2, up to £2.30 from £2. 15%

Pay rise? 4% !!

Of course there's no inflation!!!

You got 4%? I got 3% this year, and I was one of the lucky ones! Company average was 2.5%