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Inflation crisis: Due to various factors including war in Ukraine and Covid-19.

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The Ham

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The planet is only so big. The population of the human race is enormous and growing. WE are the problem

Whilst we are the problem, not entirely just down to the total number of us.

If there was a 3 lane motorway from North of Scotland to the South Coast we could all very comfortable sit having a picnic.

There's three significant factors which are causing issues:
- smaller households (in part due to aging population) with it not being uncommon for older people to be rattling about in large 5 bed homes, you don't need to go back too far before2 up 2 downs were housing significant numbers of people
- the amount of space required by our cars, it's not uncommon for garages to be larger than the master bedroom or for driveways to take up a lot of garden space
- second homes, meaning that not only is the average number of people in primary residences is lower (see point 1) but the average number of people in housing is lower (as a couple may have 2 homes which are theirs)

Obviously there are other factors (Airbnb being one, as it can be more profitable to rent out a family home for 1/3 of the year as a holiday let then it is to rent it out all year as a home) which come into play, however those are fairly significant ones.
 

yorksrob

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This country really needs to start doing something about the balance of payments deficit. Communist China would be a good place to start.
 

The Ham

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Something that is also increasing the impact of inflation is that the pound is weakening against the dollar (I believe that it's fallen by about 14% this year).

That may not sound all that much, however if the cost of fuel had risen to (say) $120 then as the pound has fallen by 14% or means that in comparison that's coating us $139.50 if the value of the pound had remained unchanged.

That's going to have a significant impact on a lot of areas.

That's before you consider the impact of other things brought in dollars (even though we directly import little from the USA).
 

Freightmaster

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Something that is also increasing the impact of inflation is that the pound is weakening against the dollar (I believe that it's fallen by about 14% this year).
But how much of that 14% was the pound actually 'weakening' against the dollar and how much was down the dollar itself
strengthening against the pound/Euro/Yen/etc?






MARK
 

The Ham

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But how much of that 14% was the pound actually 'weakening' against the dollar and how much was down the dollar itself
strengthening against the pound/Euro/Yen/etc?






MARK

Given that the Euro has fallen about 7% against the Dollar. Then the Dollar rising generally has been a factor, however regardless of the reason it will be making inflation worse than if the exchange rate stayed level.
 

yorksrob

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If they want to do something about the cost of living, they need to rein in the mobile phone companies.

Thieves.
 

Nicholas Lewis

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Something that is also increasing the impact of inflation is that the pound is weakening against the dollar (I believe that it's fallen by about 14% this year).

That may not sound all that much, however if the cost of fuel had risen to (say) $120 then as the pound has fallen by 14% or means that in comparison that's coating us $139.50 if the value of the pound had remained unchanged.

That's going to have a significant impact on a lot of areas.

That's before you consider the impact of other things brought in dollars (even though we directly import little from the USA).
Thats why you increase interest rates by at least 0.5% not the puny 0.25% to make a statement to the market traders
 

yorksrob

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Thats why you increase interest rates by at least 0.5% not the puny 0.25% to make a statement to the market traders

Meaningless. All it will do is trash the economy. They need to differentiate between domestic day to day business and speculation.
 

Nicholas Lewis

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Meaningless. All it will do is trash the economy. They need to differentiate between domestic day to day business and speculation.
75% of mortgages are currently on fixed rate so won't cause a house price crash but what it will do is make sterling attractive and given oil and gas is priced in dollars that helps to lower the price and feedback into reduced inflationary pressures.
 

brad465

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Something that is also increasing the impact of inflation is that the pound is weakening against the dollar (I believe that it's fallen by about 14% this year).

That may not sound all that much, however if the cost of fuel had risen to (say) $120 then as the pound has fallen by 14% or means that in comparison that's coating us $139.50 if the value of the pound had remained unchanged.

That's going to have a significant impact on a lot of areas.

That's before you consider the impact of other things brought in dollars (even though we directly import little from the USA).
This is being exacerbated now by the Fed managing to raise interest rates faster than the BoE, the latter really need to get those up faster to increase the £ and ease import costs as much as possible. Contrary to what some say, external inflation can be mitigated by rate rises, even if not as much as internal inflation.
Meaningless. All it will do is trash the economy. They need to differentiate between domestic day to day business and speculation.
What economy is that? One that is built on spivs, speculators, money launderers and all sorts of business that has thrived off of QE and low interest rates for too long. This so-called economy should never have got off the ground in the first place. The problem is socialism will be deployed for the rich when their wealth tanks and the poor made to pay for it after, just like in 2008.
 

yorksrob

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This is being exacerbated now by the Fed managing to raise interest rates faster than the BoE, the latter really need to get those up faster to increase the £ and ease import costs as much as possible. Contrary to what some say, external inflation can be mitigated by rate rises, even if not as much as internal inflation.

What economy is that? One that is built on spivs, speculators, money launderers and all sorts of business that has thrived off of QE and low interest rates for too long. This so-called economy should never have got off the ground in the first place. The problem is socialism will be deployed for the rich when their wealth tanks and the poor made to pay for it after, just like in 2008.

Domestic day to day economy is the warp and weft of society and that is what needs to be defended at all costs.

Your fetid imagination has lots of speculators and money launderers, but how do you intend to shield good businesses such as pubs and restaurants from your high interest rates ?.

Spending in these businesses is not contributing to our balance of payments deficit and should be encouraged.
 

Nicholas Lewis

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This is being exacerbated now by the Fed managing to raise interest rates faster than the BoE, the latter really need to get those up faster to increase the £ and ease import costs as much as possible. Contrary to what some say, external inflation can be mitigated by rate rises, even if not as much as internal inflation.
Im not sure we will see the BoE doing more than 0.25% so the gap will widen to the US and potential for £/$ rate to deteriorate further. However, BoE seems convinced that the huge diversion of money into energy costs is pulling the economy down and that is draining discretionary spend at a rapid rate which is largely what drives the UK economy these days.
 

Peter Sarf

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Im not sure we will see the BoE doing more than 0.25% so the gap will widen to the US and potential for £/$ rate to deteriorate further. However, BoE seems convinced that the huge diversion of money into energy costs is pulling the economy down and that is draining discretionary spend at a rapid rate which is largely what drives the UK economy these days.
Might help the UK if we made more of what the rest of the world needs. Mind you that could soon be armaments I am afraid.
 

david1212

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Might help the UK if we made more of what the rest of the world needs.

Stage 1 - make / be far more self-sufficient in what the UK needs. So far post Brexit I can see little progress with this.
Stage 2 - if spare capacity / surplus then export.

Mind you that could soon be armaments I am afraid.

While not something I'm totally comfortable with TBH most of the recent orders for my employer are military. Up to 2020 mixed with civilian but very few now.
 

Nicholas Lewis

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Might help the UK if we made more of what the rest of the world needs. Mind you that could soon be armaments I am afraid.
British Aerospace are very successful at that although as you say its pretty naff that all we can make is to be potentially used against our fellow humans
 

yorksrob

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Might help the UK if we made more of what the rest of the world needs. Mind you that could soon be armaments I am afraid.

It's an area that we've excelled at previously. It's clearly something that will be needed for the future.

Perhaps we ought to concentrate on producing them for ourselves and our allies.
 
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