Tuesday, March 15, 2011

Find Stuff Going Down in Price!

Smartphones and apps added to inflation basket

The ONS pulls in technology products and services every year that rapidly go down in price. In recent years we've had flatscreen tvs, mp4 players, blueray disks. They help to balance the price of a hair cut or a loaf of bread.

Posted by ontheotherhand @ 10:51 AM (1999 views)
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22 thoughts on “Find Stuff Going Down in Price!

  • lets face it,the inflation basket should include basic essential items only like food,gas,council tax water,mortgages,petrol,clothes etc telephone costs.

    inflation would have seen to have soared in the last 10-15 years and the boe would have been forced to raise interest rates a long long time ago.

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  • it doesnt change teh reality though does it.

    contradiction: why try to convince us that deflation is the evil, i.e. that inflation/GDP growth etc is the aim, and then revise down (fiddle) the inflation figure like this. Why not over exaggerate it, so that wages go up, and the salary costs are passed on by manufacturers into the cost of goods and hey-presto! deflation avoided, debts eroded, house prices supported

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  • these will shoot up in price soon due to semiconductor prices going up in japan

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  • What in gods name is going on with the UK/World!!!!!! People p*ssing about with stuff like this and the travesty of the house price market continues unchecked?

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  • Having just purchased an iPhone I fully support this.

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  • sibley's b'stard child says:

    Guess i’ll have to do my bit for the UK and spend more on smartphones and less on the inflationary stuff like food and utilities.

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  • A Sorry State Of Affairs says:

    Utter criminals.

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  • Can’t afford food sibs, but the phone’s bloody brilliant.

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  • 6. sibley’s b’stard child said…Guess i’ll have to do my bit for the UK and spend more on smartphones and less on the inflationary stuff like food and utilities.

    ~ Go with the flow and eat an iphone and glow.

    Hey, we will all be glowing soon, may I suggest some iodine sibs, good for your thyroid.

    Naughty Jap gov are at it again.

    LeCrunch.

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  • As a product manager, this makes me so angry. We price all this stuff with the high margin front loaded for the early adopters, knowing full well that the product price will reduce 20% per year. In other words, huge price reductions are baked into our business plans from the outset, and has nothing to do with inflation or deflation.

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  • “They help to balance the price of a hair cut” ??

    ~ It’s clearly not working for some.

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  • I’m thinking along the same lines as Mark. If the Japanese disaster does hit electronic components supplies, this decision by the ONS could backfire badly.

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  • ontheotherhand says:

    PDM @ 11, precisely. They’ve taken waves of price reductions in internet connections (first dial up in, then broadband, now rapidly price decreasing high speed broadband), mobile phones, freeview boxes and when anything does go up in price, they say it’s because it has new functions like central locking as standard in cars etc. and discount it from the weighting. They also fail to capture ‘planned obsolescence’. Hi tech suppliers make sure their new model is replaced with something new in a matter of months. Think ipad 2 already with a camera or whatever. In the old days think how long a fixed line telephone lasted, but now the price of a mobile is for something that breaks or is obsolete after 18 months, but they only track the price, not the cost per month of use.

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  • the number cruncher says:

    Spot on PDM – that’s why they did it

    Sent by Andriod (way better and cheaper than iphone)

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  • No one has commented on this as yet: “Dating agency fees have also been included for the first time to reflect the rising use of these websites, the Office for National Statistics said.”

    WTF!!!??? Since when was this an essential part of one’s life?

    Absolute sh*te!!

    This country has lost touch with reality, the next important statistic will be how many times Cheryl Cole f*rts each day or something equally irrelevant.

    The ancient Greek proverb “Those who the gods wish to destroy, thy first make mad” comes to mind.

    Rant over!

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  • Typo:

    Thy should read they.

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  • There are 2 sides to this:

    On the one hand the suppressesion of what some would call real RPI, allows BOE to hold IR’s low. Broadly supportive of house prices.

    On the other hand an understatement of RPI means employees have less bargining power in wage negotiations. Not supportive of house prices.

    It’s long been my positon that it is ONLY if wage negotiations get out of hand (something like the 1970’s) will a HPC be averted. It follows that I find article such as this encouraging,and the whingeing by HPC’ers rather mystifying. Clearly we can’t have it both ways.

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  • @Bellweather

    You may or may not include my comments as whingeing but I am so blo*dy cross at something as nonsensical as dating agency fees, which hardly count as a necessity, to be included in a basket of living costs.

    Incidentally, I basically agree with your theory but don’t you think that RPI running at the current 5.1% gives bargaining power to wage negotiators?

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  • Yeah, and they never include the cost of the basket either!

    “A year could not go by without …” is a pretty good way of assessing what people must be spending their money on.

    Clearly, there is a new paradigm – the basket is no longer about essentials but about a wannabe lifestyle. It’s not “Are people able to get by without survival problems” but perhaps more accurately “what does a relevant demographic in terms of active voters want to placate him/herself?”

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  • Poor old numbercruncher has to settle for the cheap android option – says it all really.

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  • Time to eat ‘Angry Bird’ Apps…

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