Monday, September 29, 2014
Sainsbury’s slashes petrol 5p/litre
Petro Price Wars
Did I hear DEFLATION? I bet those folks sucked into five year fixed rates are squirming now.
Posted by libertas @ 11:53 PM (2052 views)
3 thoughts on “Sainsbury’s slashes petrol 5p/litre”
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jack c says:
“I bet those folks sucked into five year fixed rates are squirming now” – what about the ones who have been rambling on about 10 year fixes ?
reticent says:
Back when debate on this site was between relatively rational people, there were two HPC-devoted camps: the deflationistas and the inflationistas (mostly the Precious Metals gang). Both thought house prices would fall. The former thought asset values would continue to fall, including houses. The latter thought inflation would force rates back up and the price of houses would have to adjust accordingly, since ZIRP was what interrupted the crash.
Libby always seemed to think inflation of other goods meant people would have less to spend on housing and the relationship ended there. The flipside to that is he seems to now think every technological advance or price drop in petrol speaks to deflation across all good and allows us to spend more on housing.
He may never be a bear again.
pete green says:
Libby is of course correct as Land is the mother of all monopiles and absorbs spare cash. But we have borrowed all our future income to inflate the value of land and will not get a return. Unless there is massive increase in productivity we will see a monumental CRASH! So those with land (or about to buy a tiny overpriced bit) are desperate for us to rape natural resources and have some monumental leaps in technology to safe their overborrowed selves.
But this gets us back to the problem of land – the mother of monopolies will always be the biggest problem in our economy, and the most efficient way of solving that problem is to tax that monopoly away and allow the real work and economic exchange between normal people to go untaxed.