They're also going to spend £150B to subsidize people's electric bills. For perspective, they only spend about £175B on the NHS (by far the biggest expense for the UK government), so £150B is an assload of money for the UK.
And they're pretty clear that they're going to borrow the money. I don't think their debt situation is quite as bad as ours is, but it's bad, especially after COVID. (Their inflation situation is worse - at least worse than we claim ours to be.)
The £150B splurge isn't a good sign, but for them, inflation may actually end up being transitory. Brits are generally proud of the £ and how strong it is. They're not big fans of just printing money for shits and giggles like the Federal Reserve and the European Central Bank are.
Yes, the oil/energy markets are a major driver when it comes to inflation, probably second only to the supply of money. https://www.cnbc.com/2022/09/12/fal...ion-is-slowing-new-york-fed-survey-shows.html
Yellen says inflation and higher gas prices remain a 'risk' - CNNPolitics The Fed should pause interest rate rises as US inflation slows | Joseph Stiglitz and Dean Baker
You can throw in dishonest, partisan tool as well if you want. I got a feel for that when he discussed the 1980s deficits and blamed it all on tax cuts. He said nothing about revenue levels and nothing about how much money the government spent during that time (for obvious reasons - they blow his assertion). How can anyone do that and claim to be intellectually honest or anything other than a propagandizing hack?
These small bumps in interest rate aren't doing anything as many Austrian-school economists predicted. The interest rate must be equal to or above the inflation rate to make a difference. We need 10-15% now, like what Volker did. We have a clear historical solution but our leaders won't do it because that would end their whole monetary regime of patronage.
You are right and wrong at the same time. For one, the inflation comps (yoy) start to look better starting in November (when the high rates of inflation kicked in last year and continued into 2022). So, inflation rates drop to 5-6% by summer 2023 even if you did nothing from today. Second, watch inflation drop further with milder or zero economic growth in the next 2-3 quarters. This will drop inflation to 4-5%. By then, the Fed will have slowly increased rates to 5% (6% in worst case). At that point, rates will be higher than inflation. Fed is trying for a smooth landing and not cause a recession before Election Day.
The stock market tanked today - over 1200 points on the Dow - in reaction to the bad news on inflation. So prices go up and purchasing power goes down - and those of us on a fixed income bear the brunt of that, as well as watching my hard-earned investment dollars evaporate.
Do you have any historical examples? I do and mentioned it. Plus yoy comparisons aren't the issue. The issue is vs 2019. 5% inflation compared to 2021 is still really bad. We need a stable currency not a slightly less devalued currency once you have already hurt peoples' savings. Working class people aren't getting wage increases to keep up.
We'll see. I am skeptical. Economic growth and price inflation have the same source, money supply growth. Price inflation isn't the result of economic growth or vice versa.
And I do wonder how they're calculating that figure. Are they weighing tofu, kale, and crap that normal people don't eat on the same level with beef, chicken, and fresh fruits and vegetables? I can't speak for US grocery stores, but there are many items I see at the Commissary on base (sells US items) that are more like 20 or 30 percent more expensive than they were a year or two ago.
And yet Biden was celebrating our "strong economy " in the rose garden today. The cnbc folks were apoplectic over his comments
