Sunday, September 9, 2012
One unfortunate side effect of uneven inflation, is that some endeavour that is otherwise profitable, may find that their input costs are inflated first while their output prices are marketed against as yet un-inflated purchasers. Supply must meet demand so of necessity some of these producers are either going to get out or take a loss. This article points out that the UK pork industry is currently selling herds i.e. getting out of an unprofitable market. On the other hand, some endeavours must benefit by virtue of being the other way around. Mervyn King is painting with very broad strokes so we had better hope in the UK that all the criticisms of central planning are misplaced.