dnd Posted October 2, 2006 Share Posted October 2, 2006 (edited) http://news.independent.co.uk/business/com...icle1780954.ece ...the UK unemployment rate has varied hugely from year to year but inflation has hardly budged Perhaps this can be seen as a victory for central bank credibility. Maybe it reflects the impact of globalisation on the wage-bargaining process Any comments? Edited October 2, 2006 by dnd Quote Link to comment Share on other sites More sharing options...
cynic Posted October 2, 2006 Share Posted October 2, 2006 http://news.independent.co.uk/business/com...icle1780954.ece Any comments? Yes, why is it that nobody - least of all our financial guardians on the MPC - seems to have even the vaguest notion of the relationship between M4 (measurable) and inflation (on ANY definition)....wtf!!???. Quote Link to comment Share on other sites More sharing options...
right_freds_dead Posted October 2, 2006 Share Posted October 2, 2006 surley the head of hsbc should knw real inflation is closer to 10%. he knows it doesnt include housing or fuel costs. id say he was in the 'know' and corrupted like most of people in the uk governemnt/financial institutions. otherwise hes as dumb as a bag of unemployed rocks. Quote Link to comment Share on other sites More sharing options...
assetpriceinflation Posted October 2, 2006 Share Posted October 2, 2006 I have nothing respect for Stephen King - You have taken his comments out of context. Quote Link to comment Share on other sites More sharing options...
shermanator Posted October 2, 2006 Share Posted October 2, 2006 Yes, why is it that nobody - least of all our financial guardians on the MPC - seems to have even the vaguest notion of the relationship between M4 (measurable) and inflation (on ANY definition)....wtf!!???. Seems as though my economics A level was a waste of time. I was constantly taught that money supply had a direct bearing on inflation - yes, including asset inflation Let's see. M4 running at 16% while IRs are 4.75%. Gordon Brown and all these analyst muppets reckon that's sustainable Some miracle, some economy! Quote Link to comment Share on other sites More sharing options...
dnd Posted October 2, 2006 Author Share Posted October 2, 2006 I have nothing respect for Stephen King - You have taken his comments out of context. In what way? Quote Link to comment Share on other sites More sharing options...
hedi Posted October 2, 2006 Share Posted October 2, 2006 Seems as though my economics A level was a waste of time. I was constantly taught that money supply had a direct bearing on inflation - yes, including asset inflation Let's see. M4 running at 16% while IRs are 4.75%. Gordon Brown and all these analyst muppets reckon that's sustainable Some miracle, some economy! you are always going on about m4. all the extra money has gone into houses.that is why they are not worried. all the inflationary pressure has been absorbed buy property, which keeps the voters happy. and they can just pump more in. in the end of course it goes bang. but we know that. they are just hoping it wont. Quote Link to comment Share on other sites More sharing options...
Impartial Posted October 2, 2006 Share Posted October 2, 2006 you are always going on about m4. all the extra money has gone into houses.that is why they are not worried. all the inflationary pressure has been absorbed buy property, which keeps the voters happy. and they can just pump more in. in the end of course it goes bang. but we know that. they are just hoping it wont. errrrrrrrr people mew so not all of it in housing. i think we are actually at 14% which is a massive figure - even if half was absorbed in housing 7% is a lot. Quote Link to comment Share on other sites More sharing options...
brainclamp Posted October 3, 2006 Share Posted October 3, 2006 A very interesting article. He states moneytarism and using the money measures during the lawson bom of the 1980s did not work. Its now coming back into vogue. Well, the money supply and money measures did go through the roof in the lawson boom when he tied the pound to the ERM (Euro), and interest rates were inappropiately low. The comment he made about broad money cash balances increasing, but not knowing whether it was because of lack of investment opportunities, or because of inflation is also very interesting. Keynes has stated, its is impossible for a society as a whole to alter its cash balances, individuals might, but only the central bank affects the amount of broad money held as a society. If investors are selling assets, someone else must buy them. Cash balances in aggrigate do not change. The measure of broad money, if it does what it says as a measure, would not change. Quote Link to comment Share on other sites More sharing options...
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