Stagflation anyone?

#1
Well, that's another fine economic mess we're heading for.

'Dear Dave,

I'm getting no pay rise for the next two years while you let inflation run away.
Trust me, with my real world disposable income falling faster than your credibility, I won't be spending on anything other than the essentials for the next 3 years.
Still, not to worry Dave, with benefits linked to inflation, maybe the great unwashed will create that economic boom you're hoping for?'

Mervyn King warns of inflation for next three years - Telegraph
 
#2
Well, that's another fine economic mess we're heading for.

'Dear Dave,

I'm getting no pay rise for the next two years while you let inflation run away.
Trust me, with my real world disposable income falling faster than your credibility, I won't be spending on anything other than the essentials for the next 3 years.
Still, not to worry Dave, with benefits linked to inflation, maybe the great unwashed will create that economic boom you're hoping for?'

Mervyn King warns of inflation for next three years - Telegraph
So what do you suggest? Let Labour back in?
 
#3
So what do you suggest? Let Labour back in?
Cut taxes, cut benefits across the board by @25%.

Benefit cuts will pay for the tax cuts, will also encourage the 9 million or so non employed to get a job and leave plenty of cash over to cut the deficit. Job jobbed.
 
#4
The current rate of inflation is almost entirely down to VAT and fuel duty increases.
Cameron can cut inflation anytime he wants to. If he had the spine that is.
 

Trans-sane

LE
Book Reviewer
#5
Cut taxes, cut benefits across the board by @25%.

Benefit cuts will pay for the tax cuts, will also encourage the 9 million or so non employed to get a job and leave plenty of cash over to cut the deficit. Job jobbed.
Which unfortunately would result in mass-riots, a revolt by the wooliest of the Lib-Dems, the coalition collapsing and a general election being called less than a year after the last one. And that would probably resulting in the two Eds (Milipeed and Balls) forming a government and the shit REALLY hitting the fan. Things have to be done gradually.
 

Wordsmith

LE
Book Reviewer
#6
The current rate of inflation is almost entirely down to VAT and fuel duty increases.
Cameron can cut inflation anytime he wants to. If he had the spine that is.
I think the 25% fall in the pound (pushing up import costs) and the general worldwide rise in commodity and energy costs might also have something to do with inflation.

Wordsmith
 
#7
Which unfortunately would result in mass-riots, a revolt by the wooliest of the Lib-Dems, the coalition collapsing and a general election being called less than a year after the last one. And that would probably resulting in the two Eds (Milipeed and Balls) forming a government and the shit REALLY hitting the fan. Things have to be done gradually.
So, to appease the vast client state of non employed and welfare dependent, we're trapped into a system where the only people who will see their disposable income increase over the next 3 years will be non nett taxpayers, while the nett taxpayers see themselves become significantly poorer?

This is the economics of the insane asylum!
 
#8
So, to appease the vast client state of non employed and welfare dependent, we're trapped into a system where the only people who will see their disposable income increase over the next 3 years will be non nett taxpayers, while the nett taxpayers see themselves become significantly poorer?

This is the economics of the insane asylum!
No, it means Labour won. What do you think they were doing for 13 years? This was the plan all along, and was quite concious.
 

Trans-sane

LE
Book Reviewer
#9
I think the 25% fall in the pound (pushing up import costs) and the general worldwide rise in commodity and energy costs might also have something to do with inflation.

Wordsmith
Very likely yes. Especially as most of our goods are manfactured abroad and imported. And our trade deficit has been growing non-stop for my entire life...

So, to appease the vast client state of non employed and welfare dependent, we're trapped into a system where the only people who will see their disposable income increase over the next 3 years will be non nett taxpayers, while the nett taxpayers see themselves become significantly poorer?

This is the economics of the insane asylum!
It is bonk economics. But the world of politics is not directly liked to any other world. It is only linked by public perception and frankly the public are the stupidest entity in existence. Currently we have the best government that could realistically be formed following the recent General Election. If it was just a Tory government things would be easier (and probably more sensible from a purely economic point of view). But its not. Its a coalitions with the Lib-Dems. And its the first time the Lib-Dems have been in government and so they see their role is to safeguard the "vulnerable" (often the lazy, stupid and useless but sometimes genuinely vulnerable). Shit happens. Suck it up cos just like me you haven't got any other choice.
 
#10
The current rate of inflation is almost entirely down to VAT and fuel duty increases.
Cameron can cut inflation anytime he wants to. If he had the spine that is.
I think the 25% fall in the pound (pushing up import costs) and the general worldwide rise in commodity and energy costs might also have something to do with inflation.

Wordsmith
National Statistics Online - Inflation

"Two of the main factors that had an impact on the January data are the increase in the standard rate of Value Added Tax (VAT) to 20 per cent and the continued increase in the price of crude oil"
 
#11
Cut taxes, cut benefits across the board by @25%.

Benefit cuts will pay for the tax cuts, will also encourage the 9 million or so non employed to get a job and leave plenty of cash over to cut the deficit. Job jobbed.
I do not understand people with the smore or less same opinion as yourself. (there's a few bookwizards around here so if you read this, can you enlighten me?)
Ill ask the Question which i ask people who spurt out such bollocks.

what is it we actually make and produce in this country that others buy from us and ergo we make money on?

The f**kers took there last chance on the banks, they spent our money on chancers and now we have next to sweet FA.

seemples!
 
#12
I do not understand people with the smore or less same opinion as yourself. (there's a few bookwizards around here so if you read this, can you enlighten me?)
Ill ask the Question which i ask people who spurt out such bollocks.

what is it we actually make and produce in this country that others buy from us and ergo we make money on?

The f**kers took there last chance on the banks, they spent our money on chancers and now we have next to sweet FA.

seemples!
I have to agree to a large extent. Bit on the news today when I was munching... German economy different economic model... growth last year at 4% why ? cos they make stuff and invest in long term company growth thinking ahead with private money IN THE FIRM. Ie R and D not neglected. Also, the workforce are savvy to the whole of the business and realise that they all exsist in a competitive climatr... yes even daft Helmut the rivetter. Interviewed a very smug looking sausage muncher manager... said he sold more BMWs to China than in Germany last year.

Real things, real world not spinning the wheel at the supercasino of the financial services "industry".

I went off it all years back when I heard the word "financial product" wtf is that supposed to mean ? maybe Im just simple.
 
#13
what is it we actually make and produce in this country that others buy from us and ergo we make money on?
Lots. But it could do a lot more.
http://www.cbi.org.uk/pdf/cbi-manufacturing-in-the-uk-oct2010.pdf
Food & Drink The single largest manufacturing sector in the UK, turnover in 2009 was £72.8bn In 2009, food and non-alcoholic drink exports were valued at £9bn, with the EU receiving 79% of all UK exports The sector employs 400,000 people and supports 7,000 food and drink enterprises The UK is the 8th largest exporter of food and drink and is the 4th largest in Europe.
Chemicals UK chemical industry has a turnover of £57bn, with an 8.2% share of the global market 180,000 people employed in the sector, working in 3,000 manufacturing firms; of these, only 160 firms employ more than 250 people.
Basic Metals & Metal Production Employs over 450,000 people in the UK, with an annual turnover of £38bn Contributed 11% to manufacturing’s total monthly economic output in July 2010, up from 10.2% in October 2009
Transport Equipment Industry The sector accounted for 11% of total monthly manufacturing output in July 2010, however given the diverse nature and formation of the industry, it is comprised of many different sectors such as automotive manufacturing, aerospace (both civil and defence), and leisure marine engineering Over 500,000 people are directly employed in a sector where the UK has a global reputation in areas such as wing development and construction, motorsport, design and defence capability management. The automotive sector alone contributes 11% of total UK exports.
Research & Development
Research and development (R&D) has always been essential to manufacturing – if the UK is to compete with emerging economies and develop new technologies and low carbon industries, R&D investment will become even more important in the coming decades. Manufacturing currently accounts for 74% of total UK business spending on R&D, with this investment spread across a wide range of different industrial sectors.
Given the R&D intensity associated with the sector, R&D spend in the pharmaceuticals industries accounts for over a third of manufacturing R&D investment, with electrical/optical sector in second place at 12%, and aerospace third at 11%.
 
#14
So what do you suggest? Let Labour back in?
Nope. Just don't panic. What did inflation peak at after the last Labour government? 25% IIRC.

Short Term:-

No increase in welfare benefits at the budget. Nobody's getting a pay rise, why are the unemployed more deserving.

ASAP, introduce the scheme to limit total welfare entitlement to no more than the average wage.

Stop awarding Legal Aid for immigration disputes. If you've got a case, find a no-win-no-fee lawyer.

Stop allowing the unemployed to refuse to take jobs.

FFS STOP GIVING FOREIGN AID TO INDIA AND CHINA. The just spend it on astronauts.

Stop paying women to have babies that they can't afford.


Medium Term

Grab the European Union lightly but firmly by its reproductive organs and tell it that it can't have £4 billion a year off us. If necessary start vetoing pay rises for Eurocrats and MEPs. Maggie managed it, why not Dave?

Phase out incapacity benefit. If you can live off 60 odd quid a week, so can Sven/Whet. Being too fat to walk should not entitle you to a company car off the government.


Long Term

Rebalance the economy away from welfare and government jobs funded by heavy taxation. We haven't really been able to afford the welfare state since the 1960s. Successive governments have swept the problem under the carpet. If it's not addressed now, we'll end up like Iceland/Ireland/Greece etc.

Simples. Now, for my next trick, world peace.
 
#15
Jimmy Carr came up with a good one on 10 o'clock live the other week: "Another issue in the news is 'stagflation', a conflation of the words 'stagnation' and 'inflation'....another example would be 'fucktastrophe'".
 
#16
what is it we actually make and produce in this country that others buy from us and ergo we make money on?
Plenty but that's beside the point. The Government is spending hundreds of Billions year after year paying people not to work and to have kids they can't afford.

Its REALLY rather simple. All that money spent on welfare to the feckless is wasted money, money that would be far better used by either leaving it in the pockets of the wage earners, or using it to boost national productivity through large scale investment in manufacturing.
Every penny spent paying people NOT to work is money that is just being pissed up the wall. It's a tax on success for UK PLC and as long as the bill for welfare increases faster than national wealth, Britain will get poorer, no matter how hard people making things work at making things.

And if you are indeed a chippy and live in the West Midlands, I presume your native tongue is Polish? They being the people we import by the million to actually make things while we pay millions of British people not to work.
 
#17
Create a wealth tax of 99.9%. The rich and anyone with enough money for a ticket would **** off, leaving the population solely comprising those worthy of economic cleansing. A couple of months of hard, dirty work using some top weapons and everyone can come back and start life as normal again.
 
#18
Would a reintroduction of the Black Death help?
Reduce the populatiion by 33% - instant vacancies, plus those that are left have lots more dosh.
 
#20
"I think the 25% fall in the pound (pushing up import costs) and the general worldwide rise in commodity and energy costs might also have something to do with inflation."

My you'll be suggesting Gorden the great 'Devalued' the Pound next with his Quantitative Easing, bad word with Labour since Harold's day, 'Does not mean the Pound in your pocket will be worth less tomorrow.' Yes he said that after devaluing the Pound.

Mind you I do think Dave is a loser, too friendly to Europe where he may well be looking for a Job come next election.
The Balls shall rule, The Deficit Denier extraordinaire and if you believe Gordo gave you Devaluation just wait until his pet madman is in charge.

john

Guess who's work record ?

1994 Economic Advisor to Gordon Brown
1995 Economic Advisor to Gordon Brown
1996 Economic Advisor to Gordon Brown
1997 Economic Advisor to Gordon Brown
1998 Economic Advisor to Gordon Brown
1999 Chief Economic Advisor to Gordon Brown’s Treasury
2000 Chief Economic Advisor to Gordon Brown’s Treasury
2001 Chief Economic Advisor to Gordon Brown’s Treasury
2002 Chief Economic Advisor to Gordon Brown’s Treasury
2003 Chief Economic Advisor to Gordon Brown’s Treasury
2004 Chief Economic Advisor to Gordon Brown’s Treasury
2005 Smith Institute Wonk
2006 Economic Secretary to Gordon Brown’s Treasury
2007 Member of Gordon Brown’s Cabinet
2008 Member of Gordon Brown’s Cabinet
2009 Member of Gordon Brown’s Cabinet
2010 Member of Gordon Brown’s Cabinet
2011 Shadow Chancellor of the Exchequer
 

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