The survey results are hardly surprising. I reckon inflation is now at least 10%. If the Bank of England knocked on my door, that would be my estimate.
josh, what is running at more than 10% inflation?i think inflation is a bit overstated by folk sometimes. i find wandering round the supermarket things seem pretty cheap, especially when you look at specials (i suggest morrison's instead of waitrose by the way). used car prices down substantially, bbc news reporting today. cd's/dvd's all getting cheaper i notice (although why anyone would buy when it's all free on the internet...). computers look to be a THIRD of the price from what i paid 6 years ago. beer prices seem to be forever creeping up, but not 10%+ (prices seem to have been between £3 and £3.30 a pint for a while now). bus and tube fares down thanks to oyster card (although i'm sure if the fascist mayor Ken Livingstone manages to not get arrested for corruption, he'll be pushing those up again). i don't go clothes shopping all that much, but prices don't seem to have done a lot, perhaps helped by competition from the likes of discount places like H+M etc.if you have examples of 10%+ inflation, please share them (I'm not doubting that some things may be that, just can't really think of any straight off).
How about petrol....
I agree Traderboy, it's possible to keep costs such as clothing and food down if you don't go crazy. Its even possible with household fuel bills if your young and don't mind getting a bit cold! HPI and Council taxes though have been inflating like crazy over recent years and its these basic fixed costs that are the most crippling. Council tax running at nearly 5% whilst I suspect average wages are running at well below that. Chefdave
Inflation = increase in money supply relative to demand for itDeflation = opposite of inflationI do bang on about this, but CPI is just an inaccurate, lagging indicator of the symptons (not cause) of inflation.A question the Bank should've asked the households was "and what are you going to do about it?"Global wage arbitrage has reduced the ability to collectively bargain up wages. As the economy collapses all the service sector jobs will see declining wages due to reduced consumer demand and massive over-expansion.It's a terrible time to be working as a hairdresser and paying a mortgage on a recently ARMed city apartment.Nick
Trinkets you can pick up = down in priceStuff that matters = up in priceUniversity tuition, medical care, housing, food, petrol, taxes = all shooting upFortunately the first three have peaked and are coming down again. We'll hear all sorts of bullshit about cost-push inflation but it's smoke and mirrors. The rule will be simple:If you can't go without it, the price goes up. If you can go without it, the cost plummets.People have the same amount of income (or less if you have an adjustable rate mortgage) so as the essentials go up, the amount left over for discretionary spending plummets. Add in increased debt burden (= less left over to spend) and changing attitudes to (=less willingness to spend) and you have your retail crisis.One to watch for 2008 is desperation in airlines and tour operators. There's nothing harder hit by a discretionary consumer pullback and rising oil prices then operators of frivolous holidays.Nick
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