A Christian Sceptic
Master Poster
- Joined
- Dec 7, 2007
- Messages
- 2,288
There's definitely inflation in the amount kids are getting for their teeth from the tooth fairy these days.
There's definitely inflation in the amount kids are getting for their teeth from the tooth fairy these days.
Puppycow
Penultimate Amazing
Just wanted to note that it's been over a year since I first posted this thread and no inflation yet.
Don't be ridiculous. There's the sekret magic inflation that shows up everywhere except in prices. Just ask Tippit.
Another of the whacktards -- I think it was BAC -- just posted a new set of linkspam in which he pointed out that if you eliminate rents and housing prices from the CPI basket, everything else went up by about 2%, which he interpreted as a piece of falling sky. Of course, intelligent readers with actual knowledge of economics recognize that "if you eliminate all the prices that went down, the price of everything else went up" is hardly a compelling argument. In fact, the most worrisome part of that factoid -- which of course none of the whacktards will acknowledge -- is that inflation only went up by 2% when you've cherry-picked your numbers to make inflation look as bad as possible; the worst possible scenario those lying scum can produce is on the high end of "normal" since the 1990s....
The lack of inflation so far is a very bad sign, it simply means that the hyperinflation is getting closer and will be even worse when the dam breaks.
Fortunately, I have this magic rock to sell you that will keep inflation away. Or maybe tigers; I can never remember which.
Wanna buy it?
Naah, there is a bit of a glut of those, I do not want to encourage production of more.
I wonder how many would actually use that argument about inflation?
As far as I can tell the bubble phenomenon seen in stock and house prices does not apply to it.
Actually, inflation is very succeptable (sp?) to "bubbles" (although governments work very hard to prevent deflationary "crashes" after bouts of inflation). If you expect that prices will rise significantly over the next six months, then what you should (rationally) do is to buy everything you'll need over the next year right now before prices rise against your existing cash reserves. Essentially, burn your cash reserves to the ground (and if need be, borrow at the lowest interest you can before the banks wise up).
But this buying frenzy will drive prices up, creating even more inflationary pressure.
So, yes, if enough people expect inflation, it will become a self-fulfilling prophesy.
What this really shows, then, is how completely off-base the inflation 'tards are, because they can't even muster enough persuasive power to start the prophesy rolling.
Oh how I envy the U.S. and their lack of inflation.
Here in the UK, inflation is at 3.1% by the CPI measure (which excludes many housing costs but which is the benchmark for indexation of benefits) or 4.6% by the broader RPI measure. It's been this way for months.
Source: http://www.bbc.co.uk/news/business-11521293
It's almost impossible to get a decent return on money at the moment:
- After tax savings rates are well under 2%
- Over the past 10 years the return on the stock market (with dividends re-invested) is negative
- Housing asset prices are down over the past 3 years
- There are currently no index linked products available through NS&I (government savings products)
Looks like Lucky Boy in the 3.30 at Ascot is about the only way get a return - but hardly risk free.
As a result, the value of my assets is likely to decrease in real terms - and may decrease in absolute terms
Here in the UK, inflation is at 3.1% by the CPI measure (which excludes many housing costs but which is the benchmark for indexation of benefits) or 4.6% by the broader RPI measure. It's been this way for months.
Source: http://www.bbc.co.uk/news/business-11521293
It's almost impossible to get a decent return on money at the moment:
- After tax savings rates are well under 2%
- Over the past 10 years the return on the stock market (with dividends re-invested) is negative
- Housing asset prices are down over the past 3 years
- There are currently no index linked products available through NS&I (government savings products)
Looks like Lucky Boy in the 3.30 at Ascot is about the only way get a return - but hardly risk free.
As a result, the value of my assets is likely to decrease in real terms - and may decrease in absolute terms
I am not sure what the inflation is here, but the (variable) interest on my mortgage is 3.6%.
This site says it's about 1.3%.
timhau
NWO Litter Technician
10 years ago the dot-com bubble still had a lot of air in it. 10-year returns on old-economy industrial shares may look very, very different.
I used the UK stock market indices because I felt that they provided decent overall indication of market performance and didn't require me to do any fancy stock picking.
IIRC only about 20% of funds outperform the market indices so I felt it provided a good indication as to the likely return that a normal investor would experience.
I do have a significant (for me) holding in an Income and Growth fund which mostly holds the kind of shares you mention. It's a high performer within its sector but its 10 year return is just under 10% (actually 9.6%).
Very few of my investments in funds (I'm a very cautious investor so they're mostly market trackers) are worth significantly more than my initial investment. The rare occasion where I've tried spot investments have proved to be a disaster - I bought bank shares about 3 years ago - you live and learn.
Puppycow
Penultimate Amazing
And many in the US would envy your job market.
UK unemployment rate falls to 7.7%
Looks like your economy is on a good track compared to the US.
It's somewhat promising but we're not out of the woods yet. The government will be introducing a broad range of austerity measures over the next couple of years. There are various estimates of the number of public sector jobs to be lost but a saving of 25% is required and a substantial number of jobs will have to go.
The hope is that the private sector will pick up the slack but the skills may not be transferable and the number of jobs may not be sufficient:
http://www.independent.co.uk/news/b...enough-to-offset-public-job-cuts-2047168.html
Puppycow
Penultimate Amazing
I see.
The reason I pointed out your improving unemployment rate is that there is a tradeoff between inflation and unemployment called the Phillips curve.
You may envy the low inflation in the US, but you should be aware that it comes at a cost. Very low inflation or deflation tend to accompany decreased employment.
In which case, the so called "economic miracle" seemed to have run counter to the Phillips curve.
As unemployment has risen, so has inflation.
Of course that could be as a result of quantitative easing
Inflation (trending gradually upwards since 2000): http://www.bbc.co.uk/news/10612209
- the temporary dip in RPI was due to historically low interest rates reducing housing costs. The CPI measure which largely excludes housing costs took a much smaller dip.
Unemployment: flat and then spiking: http://www.tradingeconomics.com/Economics/Unemployment-Rate.aspx?Symbol=GBP
Not doubting the veracity of the Phillips curve, just that the UK economy has behaved differently in the very recent past
As unemployment has risen, so has inflation.
Of course that could be as a result of quantitative easing
Inflation (trending gradually upwards since 2000): http://www.bbc.co.uk/news/10612209
- the temporary dip in RPI was due to historically low interest rates reducing housing costs. The CPI measure which largely excludes housing costs took a much smaller dip.
Unemployment: flat and then spiking: http://www.tradingeconomics.com/Economics/Unemployment-Rate.aspx?Symbol=GBP
Not doubting the veracity of the Phillips curve, just that the UK economy has behaved differently in the very recent past
Puppycow
Penultimate Amazing
Understood. Of course there are lots of other factors affecting the economy at any given time, so the relationship does not always appear to hold true, even assuming that the theory is correct, which is debated.
ETA: Still, you can see from those charts that the recent spike in unemployment from late 2008 coincides with a steep dip in inflation.
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