I think the ONS is one of the few civil service organisations that has at least tried to maintain some independence from the Government and as such do have a decent trusted reputation

But we all know influence can come from many many sources so who knows whether the government has changed the basket. The argument for having such a diverse set of products is that any macro level changes, for example a shortage of woodchip affecting furniture prices, is levelled out. The flip side of this though is that the figures become so blended it is representative of no one or no thing.

Economic statistics are not an exact science, they are merely indicators and the problem is we can sometimes become obsessed with them and think they are 'real'

I would also be wary of listening too much to economists and so called professionals because lets be honest, where were they a year ago?

The number of so called prominent economists who actually saw the financial crisis coming was tiny, thanks lads

The bottom line is that the UK has a very weak economy in many areas and I think it is worse than anyone thinks, just a guess though, what the fcuk would I know

Originally Posted by interestednovice

Edited to add: Double checked. You are partially right, but your inference is completely wrong. Previously, the BoE measured (since 1992) inflation on the basis of RPIX - that is RPI excluding mortgage repayments.

You're still wrong. RPI was used until 1997 when Brown changed to using RPIX. The RPIX does contain many elements which track the cost of housing, although mortgage interest payments are excluded, it's usually because low interest rates have reduced mortgage payments so 'affordability' (on a month to month basis) is maintained, even though capital balances change.

CPI doesn't track the cost of property-value related taxes for example.

So Brown has twice told the BOE to change which method it uses to track inflation, from RPI to RPI-X, and then to CPI. In both cases, components relating to house prices were dropped, therefore making the BOE use a measure which made them less likely to increase rates at just the time it would've been a good idea to.

http://en.wikipedia.org/wiki/RPIX

Now, as to whether or not Brown has exerted any influence on the ONS to change the basket of goods used to calculate CPI itself, I couldn't say. It would hardly be the first instance of New Labour politicising the civil service though.

See - thing is, even if you go to the weblink you put up, it states quite clearly that RPIX was used from 1992.

The reason that the BoE started monitoring it from 1997 for monetary policy purposes, is because until then, they didn't have any right to set monetary policy. As I have already said.

If you are going to talk crap, at least try and find some dodgy reference that backs your argument. This actually backs my point that interest rate setting and inflation are less open to political interference than they were before labour came to power.

Now, to look at the consequences. If the government says to BoE keep RPI at 2% (instead of CPI) and inflation falls, what could the BoE do? Well, if they put up interest rates - then immediately the next month, inflation HAS to go up - because of increased housing costs. However, longer term, this has a detrimental impact on growth, inflation and the economy.

Therefore do you see why they could only ever use CPI / RPIX? Using anything including housing costs leads to a "circular reference".

Don't rely on wikipedia by the way - lots of decent references at

http://www.icaew.com/index.cfm/route...ntroduction_em

I would vote for ANYONE just to keep the Conservatives OUT. Short sighted, maybe, but they just don't represent ME or anyone i know.
I also remember the 80's as a time of deep unrest, poverty p1ss poor education( I don't care what is said to the contrary, education gets a lot more money nowadays).
The Conservatives haven't changed they are just riding on the back of a recession that they've been gifted. And a Labour party deeply wounded by a pointless war in Iraq.
Still we have a slighty different government/assembly, albeit with not enough powers in Wales it's more a coalition so hopefully it wont affect us so much when we get dumped in the sh1t in the next few months.

Originally Posted by llech

I would vote for ANYONE just to keep the Conservatives OUT. Short sighted, maybe, but they just don't represent ME or anyone i know.
I also remember the 80's as a time of deep unrest, poverty p1ss poor education( I don't care what is said to the contrary, education gets a lot more money nowadays).
The Conservatives haven't changed they are just riding on the back of a recession that they've been gifted. And a Labour party deeply wounded by a pointless war in Iraq.
Still we have a slighty different government/assembly, albeit with not enough powers in Wales it's more a coalition so hopefully it wont affect us so much when we get dumped in the sh1t in the next few months.

Pretty much all of which could have been said about labour when they came to power - on the back of sleaze, coming out of a recession, and everybody remembered what they had done in the 70s to the country.

Originally Posted by Bazzinho1977

Pretty much all of which could have been said about labour when they came to power - on the back of sleaze, coming out of a recession, and everybody remembered what they had done in the 70s to the country.

More like, most who voted in '97 were gullible enough to beleive Phoney Tony's lies and half truths.
Most believed the press spin and couldn't see past the fact we were in the mire then and wouldn't let the incumbent government get the fixes in place to cure the problem.



Grass is greener under new leadership my arrse!

Originally Posted by mick_sterbs

Originally Posted by Bazzinho1977

Pretty much all of which could have been said about labour when they came to power - on the back of sleaze, coming out of a recession, and everybody remembered what they had done in the 70s to the country.

More like, most who voted in '97 were gullible enough to beleive Phoney Tony's lies and half truths.
Most believed the press spin and couldn't see past the fact we were in the mire then and wouldn't let the incumbent government get the fixes in place to cure the problem.



Grass is greener under new leadership my arrse!

Sadly, CallmeDave seems to have the same play book now - and a lot of people are falling for it!

Policies - no.
Soundbites - yes.

Apt....

Originally Posted by Bazzinho1977

If you are going to talk crap, at least try and find some dodgy reference that backs your argument. This actually backs my point that interest rate setting and inflation are less open to political interference than they were before labour came to power.

This is slightly fruity language to use to somebody you don't know and who hasn't used it towards you, but fair enough, I did indeed misread that paragraph. RPIX was used from 1992 until 2003. It still accounts for housing costs more than CPI, and Brown was responsible for this change.

Originally Posted by interestednovice

Gordon Brown instructed the BOE to use CPI instead of RPI for it's inflation target when he was chancellor.

The RPI includes house price inflation as a component, the CPI does not.

And before he did everyone was ticking because they used RPI instead of CPI - because house prices were supposedly keeping the rate up.

Originally Posted by Whet

Originally Posted by interestednovice

Gordon Brown instructed the BOE to use CPI instead of RPI for it's inflation target when he was chancellor.

The RPI includes house price inflation as a component, the CPI does not.

And before he did everyone was ticking because they used RPI instead of CPI - because house prices were supposedly keeping the rate up.

Clocks tick.