Saturday, August 18, 2012

Not a word from MSM about CPIH

What is the policy of the Bank of England? Are they politicians in disguise? Independence anyone?

Richards recounts some of the conversation at a consultation he attended with the Royal Statistical Society on the subject of adding house prices to the Consumer Price Index (CPIH). A member of the Monetary Policy Committee, confirmed that CPIH targeting is approaching: "However the conversation took a slightly different turn as the speakers added that a driver right now was that the current Chancellor of the Exchequer had asked for it [CPIH]. As one of the members of the Monetary Policy Committee Martin Weale was there I asked him if the MPC would therefore target such an index (CPI plus house prices or CPIH) and he replied yes." I can only think of one reason for the Chancellor wishing to target CPIH now - future price falls.

Posted by quiet guy @ 01:42 PM (1669 views)
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3 thoughts on “Not a word from MSM about CPIH

  • mark wadsworth says:

    If they are predicting price falls, that’s good news.

    If they’re going to use it as an excuse to cut interest rates to negative, that’s bad news.

    Mixed bag, then.

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  • Not possible to get any sense looking there.

    If house prices were dropping, they would be included in CPI, if rising then they would be removed. All a hopeless con.

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  • Just to say that’s a good find.

    This guy talks a lot of sense and has picked up on the con trick that is quantitative easing and the Bank of England’s current policy of protecting the severely indebted with weaselly adjustments in the inflation measures. It is wrong headed and the BoE knows it.

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