It has become apparent to commentators like Liam Halligan that the Great Deflation Scare of 2009 is, in his words :
“… largely a myth – an alibi for wildly expansionary fiscal and monetary policy concocted by Western governments and their media lackeys.
After all, where is deflation? Data released last week put annual US core inflation at no less than 4pc. So why is the Fed doing this, following the Bank of England’s lead? Because the real solution – forcing banks to face the music, while rescheduling massive private and public debts – is too politically frightening for our so-called leaders to contemplate.
A decision has been made, but not announced: we’ll inflate away our debts instead”
Media lackeys ? That’s a bit strong. Anyone in mind, Liam ? Robert Peston’s been waving the spectre of deflation for some time.
I invite readers to study the evolution of yesterdays lead BBC news story, from “Deflation risk as prices to fall” all the way through to “Surprise hike in consumer prices”.
It turns out that the only component of inflation to fall is mortgage costs – completely under the control of HMG/BoE. Everything else is going up. The only deflation is caused by the Government.
Quite so! Perhaps (non-interest based) inflation will fall in the coming months, but it seems remarkable that with last month seeing the biggest monthly rise in prices since the early 1990s, it has gone unremarked.
http://www.statistics.gov.uk/statbase/tsdataset.asp?vlnk=7174&More=N&All=Y
Will2001,
Good observation, it wont go unremarked for long, an increasingly worthless currency will be able to buy less and less, imports that we rely on will become more expensive and home produced goods already scarce will become more expensive, people will have less money and that will be woth less a destructive spiral and direct concequence of Browns new fake money being hosed around.
Laban
When will you realise that the economic consensus is that Brown and Obama are doing a fine job? The matter is now “settled” and, following a meeting of high level executives (and attended by Roger Harrabin – as adviser on “settled” debates – and Robert Peston), the BBC has decided that giving airtime to “money printing effectiveness denial” is counter-productive and misleading.
I caught just enough of Radio 4’s news this lunchtime to see they’s missed the fact that the gilts auction had failed. So here’s a query. Are they a) simply too stupid to understand the importance of that failure? or b) simply unable to report such news? or c) do they actually live in GB’s fantasy world?
What a mess. Keep ignoring the devaluation of the pound, BBC.
I always knew that the 70’s were the 2dream time” for the labour party – the ‘ideal’place they always wanted Britain to be. Now we have them back with a vengeance – sagflation (yum yum) and they have added in their own brand of 21st century socialist population engineering just to ensure the vibrancy of the socio-economic mix
BTW has anybody noticed how much Pa Broon looks like Leonid Breznev?
David – as the anon poster who asked for a thread regarding this (in “Tories in the cross-fire”, thanks.