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Poll: Tomorrow's Cpi And Rpi Data

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Guest Popalot

Ok, it is that time again where they juggle around with the price of hairdryers to dupt the public into believing the continued lie about the real rate of inflation.

I suppose the question is more interesting this month - because here is where we would expect to see the start of really serious manipulation of the housing market. If it is low, we will see that they are paving the way to do an August 2005 and cut rates (King out-voted again by Brown stooges).

(I suppose my next poll will be - if tey cut rates will you leave the contry?!)

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Ok, it is that time again where they juggle around with the price of hairdryers to dupt the public into believing the continued lie about the real rate of inflation.

I suppose the question is more interesting this month - because here is where we would expect to see the start of really serious manipulation of the housing market. If it is low, we will see that they are paving the way to do an August 2005 and cut rates (King out-voted again by Brown stooges).

(I suppose my next poll will be - if tey cut rates will you leave the contry?!)

So what do you believe the REAL rate of inflation is? And what makes cynical people like yourself believe you know better?

Append: Most conspiracy theories turn out to be b0110cks. Inflation doesn't appear to be that high from my personal experience.

Edited by Dan In Bham City

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So what do you believe the REAL rate of inflation is? And what makes cynical people like yourself believe you know better?

Append: Most conspiracy theories turn out to be b0110cks. Inflation doesn't appear to be that high from my personal experience.

hey newbie.........lose the attitude !

oh, and between 5 and 10 percent

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Guest Popalot
So what do you believe the REAL rate of inflation is? And what makes cynical people like yourself believe you know better?

Oh dear. well, the real rate of inflation is probably about 6.4% CPI and about 15% RPI.....the same questions are being asked of the US inflation figures today on Bloomberg.

Get with the general consensus..... The "your real inflation rate" gizmo on the web was a sellout. People ain't that stupid because they do think a tad at the checkout.......................

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cpi? about 6% if it was weighted correctly.

So how come I haven't been experiencing a CPI of anything like that? I agree asset prices have been inflating massively. For example, my weekly shop has not increased more than the 15% in the last 6 years. So where is this 6% CPI, and why should anyone believe a few nutters on an internet forum as opposed to genuine economists?

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cpi? about 6% if it was weighted correctly.

Interesting, what difference do you see between the current basket and a "correct weighting"?

I was fairly impressed with the basket adjustments for 2006 - they made sense to me... as an index to harmonise trade between nations - as opposed to a measure of inflation to keep interest rates in check.

I am not convinced, that CPI is relevant in the UK since we have so many owner occupied houses, which - in turn - demand the largest proportion of expense for a large number of people.

For some of the things I look at, I'm surprised CPI is positive - the price is falling for everything except property - as far as I can see.

Do you mean to say that Eurostat should have found a way to include property in the CPI?

Edited by A.steve

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Oh dear. well, the real rate of inflation is probably about 6.4% CPI and about 15% RPI.....the same questions are being asked of the US inflation figures today on Bloomberg.

Get with the general consensus..... The "your real inflation rate" gizmo on the web was a sellout. People ain't that stupid because they do think a tad at the checkout.......................

Talk about sheeple... "Get with the general consensus". As a businessman, and graduate from a real science degree from an established university, I like to think of myself as someone who believes in the evidence. Cheap gizmos on websites are established by the masses for the masses. I do not see the evidence for CPI inflation as defined, to be that far away from the official figures, and certainly not 6.4%.

Whether CPI is the correct measure of inflation to be worrying about, and whether we should be pursuing a policy of pure inflation targeting or not is a separate debate.

And if you're talking of consensus, I thought monetarism was considered to be dead.

Appended: Because you appear to be equating RPI to M4

Edited by Dan In Bham City

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Talk about sheeple... "Get with the general consensus". As a businessman, and graduate from a real science degree from an established university, I like to think of myself as someone who believes in the evidence. Cheap gizmos on websites are established by the masses for the masses. I do not see the evidence for CPI inflation as defined, to be that far away from the official figures, and certainly not 6.4%.

Whether CPI is the correct measure of inflation to be worrying about, and whether we should be pursuing a policy of pure inflation targeting or not is a separate debate.

And if you're talking of consensus, I thought monetarism was considered to be dead.

Appended: Because you appear to be equating RPI to M4

it matters a lot if the CPI measure is flawed, because if the wrong medicine is given to the patient, then the cure wont work, making it much harder to deal with in the future.

Id have thought Science would have taught you that.

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it matters a lot if the CPI measure is flawed, because if the wrong medicine is given to the patient, then the cure wont work, making it much harder to deal with in the future.

Id have thought Science would have taught you that.

If you bothered to read my post you would realize that I am not arguing on the validity CPI, I am just stating that you are wrong to state that the CPI is 6ish% and RPI is 15%. Because that is factually incorrect. It seems to me a lot of people on here feel hard done by due to HPI, and they are willing to believe whatever they are spoon fed on HPC and other internet sites with no authoritative sources.

I for one do not think HPI has been beneficial to the economy. More importantly, I think the explosion of private (and public) debt is a disaster waiting to happen (or possibly already happening). That does not mean that I will believe all the tosh that comes out of these forums.

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More importantly, I think the explosion of private (and public) debt is a disaster waiting to happen (or possibly already happening).

Is that because it causes inflation?

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So what do you believe the REAL rate of inflation is? And what makes cynical people like yourself believe you know better?

CPI does reflect inflation on the goods on which money is being spent on in the UK, IMO. However, it is distorted by low inflation/deflation in expensive goods which are consumed by the wealthy (plasma screens, 4x4s etc). I'd like the government to publish CPI for goods bought by people who earn between 70 and 130% of the median wage - I reckon it'd be more like 5% (I'd imagine it would be much harder to collate this figure). Non-discretionary inflation on staple foods, utilities and transport must be around 7%.

Edited by Leodhasach

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Is that because it causes inflation?

Whether it causes inflation or not would not be my worry alone. My worry is that incomes are not increasing quickly enough to erode the debt over time.

I don't really care much about inflation on its own. The real argument to be had is over standard of living. I believe that Britain as a whole is experiencing a stagnation of living standards, and has done for some time now.

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If you bothered to read my post you would realize that I am not arguing on the validity CPI, I am just stating that you are wrong to state that the CPI is 6ish% and RPI is 15%. Because that is factually incorrect. It seems to me a lot of people on here feel hard done by due to HPI, and they are willing to believe whatever they are spoon fed on HPC and other internet sites with no authoritative sources.

I for one do not think HPI has been beneficial to the economy. More importantly, I think the explosion of private (and public) debt is a disaster waiting to happen (or possibly already happening). That does not mean that I will believe all the tosh that comes out of these forums.

I didnt state my guess for CPI at all.

And whether you think its defined correctly or is a good measure is also irrelevent. The relevant part is that GORDO has told the BoE to control Inflation, using CPI, to under 2%. the actual infaltion we all feel is ignored.

If the figure is manipulated, as the posters here are saying, then my argument about the wrong medicine definately applies.

market cant be fooled

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Is that because it causes inflation?

In my opinion, debt is not, in itself, a trigger for inflation... rising levels of debt causes inflation, but that relates to the change in level of indebtedness - not with debt per se.

Debt is a problem for several reasons...

* Personal debt limits personal freedom and flexibility for the person in debt - with reckless mis-pricing of credit leading not only to ultimately unpleasant consequences for the person in debt, but also to the rest of society (by way of credit to the foolish being used to exclude the sensible from assets and freedoms they need) - but also by piling risk unfairly on those saving for their future.

* Corporate debt is a millstone making any future hurdles all the more difficult to surmount - hence putting both the future for employees at risk, as well as both long and short term profits. Corporate debt is bad for shareholders.

* The infrastructure of debt leaves vast opportunities for fraud - which acts to the detriment not only of the unfortunate few who are prosecuted, but also to the rest of society who ultimately shoulder the bill for these errors of judgement.

Debt without proper appraisal of risk is an economic weapon of mass destruction, it should be legislated against. For example, I consider it obscene that a secured loan, if defaulted, where there is negative equity, should persist after the asset on which the debt is secured has been sold. Maybe a law to limit the liabilities of the public (who seem to find it so hard to comprehend their own risk taking) would encourage lenders to be more careful in their lending - which might offer a glimmer of hope that debt can be brought under control.

Edited by A.steve

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I thought that REAL inflation is the increase in money supply MINUS the actual GDP?

The threads about CPI here on HPC totally ignore the fact that it is a meaningless figure to almost every citizen of the UK. Of course it's a load of bolox, that's what it is designed to be - why do people carp on about it ?

Buckers

As I said before, I thought moneterism was dead.

We shouldn't be obsessing about inflation. It's standard of living we should be worrying about. After all, as long as income (including bank interest) goes up at least in line with inflation joe public doesn't have a major problem.

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Yep CPI is bull. An accurate measure of inflation would include food, bills and living costs (rent not house prices, becuase houses are a luxury not a need) and it would weigh up everything as a proportion of income in terms of averages spent. Only then will you get a true representation of how inflation effects most people.

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I didnt state my guess for CPI at all.

This appears to be true. I was refering to the muppet that did. [typo]

And whether you think its defined correctly or is a good measure is also irrelevent. The relevant part is that GORDO has told the BoE to control Inflation, using CPI, to under 2%. the actual infaltion we all feel is ignored.

Again if you bothered to read my post you'd find that I made no statement as to how useful the CPI is as a measure of inflation. I though this thread was a poll on what people believe the CPI and RPI data tomorrow will show. Not on whether they are the right tools or not.

Edited by Dan In Bham City

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Guest Popalot
As I said before, I thought moneterism was dead.

We shouldn't be obsessing about inflation. It's standard of living we should be worrying about. After all, as long as income (including bank interest) goes up at least in line with inflation joe public doesn't have a major problem.

Hey Dan. Congratulations on your recent graduation! I remember feeling indomitable with my intellect at your age. Over time I have learned how the real world works, sadly.... and it is not according to text books, alas!

P Clearly income is not going up with inflation. talked to any TU bosses recetly?

Anyway cheers!

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Hey Dan. Congratulations on your recent graduation! I remember feeling indomitable with my intellect at your age. Over time I have learned how the real world works, sadly.... and it is not according to text books, alas!

P Clearly income is not going up with inflation. talked to any TU bosses recetly?

Anyway cheers!

Yet another person who draws inaccurate conclusions based on speculation. "Recent graduation"? "Your age"? "text books"?

I made no statement as to whether incomes were going up with inflation or not. I suggested that if they did move in line with inflation there would be no problem for joe public. [edit grammer]

Aside: Don't get me started on unions.

Edit: Maybe I can concede the "age" part.

Edited by Dan In Bham City

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Inflation is an increase in the money supply that leads to an increase in the price of goods and services, supply demand is not inflation it is market forces.

There is 100% proof correct and guaranteed that there is inflation in the economy going unchecked and making us poorer - we have the lowest disposable income for 10 years!

Gold/Silver/Oil/Food are all telling us there is inflation in most if not all fiat currencies.

I am affected by inflation but because I am frugal, well paid and a bit of a stinge I do not really have problems with money - a random person rang my phone and asked me if i needed help claiming bank charges, I told him i never had a bank charge i'm always in the black, he was incredulous and laughed thinking I was joking - I told him I was not and hung up the phone. There are a lot of people out there that are not like me.

Inflation - stay at 1.8 they will make up some excuse or another.

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I asked what you thought was wrong about the CPI basket... and you said:

Honesty!

I'm afraid I'm still none the wiser about what you think is dishonest. Choosing the CPI (and RPI) basket is not a simple task, but (in my opinion, subject to the constraints of the indices - which are well documented) the ONS has done as fair and equitable a job as possible... given the inherent complexity of the task at hand.

The problem, I think, is that the Government mandates that headline inflation is CPI not RPI... and RPI is the inflation that affects how average people feel about their finances when living in the UK... while CPI reflects more closely inflation as it relates to international trade. I think it is dangerous and dishonest to control interest rates solely by CPI - and I do believe that this has a direct influence on personal debt and all the problems that come with that. I think that the targets that have been set for the BoE are extremely dangerous unless we rapidly adopt the Euro. I think it was dishonest of Brown to suggest that his policy on the Euro was to wait and see - where, in fact, he's rigged our economy with a poison-pill which makes a severe recession almost inevitable if wee pull pack from adopting the Euro.

I've no clear opinion about whether or not it is right to join the Euro - but I do understand that many others have staunchly defended positions on both sides of the debate. What I find utterly distasteful is the idea that Government is not open about its long term plans in this regard... and consider the uncertainty arising as a consequence is extraordinarily damaging to industry and commerce in the UK. How anyone can plan successfully in the context of 5.75% interest rates in Sterling - versus 4% interest rates for the Euro - where, increasingly, commerce must compete with and market to Europe as a whole.

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Sterling has been trading higher today ahead of tomorrow's CPI release. My guess is that most market players expect a high figure, possibly >2% and are prepared to stay long on the pound in the lead up to Tuesday's release. If the rate remain at 1.8% or goes lower, then sterling will drop sharply. Somebody out there may already know something ahead of the 'official' release and the price of sterling may be refelcting this.

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