Companies and workers are trying to pass the impact of inflation onto each other — and that risks persistent inflation, according to Huw Pill, the Bank of England’s chief economist. “What we’re facing now is that reluctance to accept that yes we’re all worse off, we all have to take our share,” Pill said on an episode of Columbia Law School and the Millstein Center’s “Beyond Unprecedented” podcast, released on Tuesday. https://www.cnbc.com/2023/04/26/ban...brits-need-to-accept-were-all-worse-off-.html
I don't know about you guys, but i have been accepting that i am poorer the last 25 years: Because house prices have gone up 600% in that time. Also gold and stocks. All up 600% or more But thats supposedly good inflation. But it never felt like good inflation to me, even though i own real estate myself.
All talks and no solutions!! "So somehow in the U.K., someone needs to accept that they’re worse off and stop trying to maintain their real spending power by bidding up prices, whether higher wages or passing energy costs through on to customers, etcetera.” So you want people to not spend and the businesses all close down and they enter a recession?? There is a website that I visited that actually keeps track of all the restaurants, pubs and bars have closed down since covid. Over 70% of the food service establishments have permanently closed down since covid, including many Michelin-starred ones so people are already cutting down on spending. It's already starting... "He added that the U.K., which is a net importer of natural gas, faced a situation where the goods it buys from the rest of the world had gone up a lot relative to what it is selling to the rest of the world, primarily services. The U.K. imports nearly half its food." Well maybe the solution is don't f***ing eat so much! And grow your own food perhaps. That doesn't need natural gas, does it? And if what you are exporting to the world is not commanding that much price, then perhaps export something else that's worth more would help? Or a better solution, not export at all and just have a closed economy? Brexit is supposed to be a boom for the local economy so why the hell is Britain still importing when they can't even export to earn enough money? Why is Britain still trading with other countries when they exclude Britain from all the markets for their exports but still dump s*** on Britain? "But some argue the U.K. is particularly at risk due to its import-heavy economy, weakness in the British pound and a tight labor market which has been constrained by Brexit." Britain should operate like Japan. Develop robotics to create the productivity it needs and then just produce their own goods and then if there is anything leftover, then export. And close its own f***ing economy! Globalization is not for everyone. It only works if it benefits you. If it doesn't, then a closed economy is better.
First of all, housing price has not gone up 600%, it's about 100% at the most for most of North America and you won't benefit from that until you cash out so unless you are a real estate developer that buys and sells real estate all the time, you won't see a dime of that increase until you sell your house to go to retirement homes. And stocks have not gone up by 600% either, it's only gone up by about 263%. The value of S&P 500 on April 23, 1998 (exactly 25 years ago) was 1119.58 and yesterday, April 26, 2023, its value was 4071.63, a growth of 263% and that's mostly fueled by the money-printing Biden did to pacify people during the covid. Without it, the growth would've been maybe just 100%+ as well. Before covid, the value of S&P 500 on Feb. 21, 2020 (just the day right before the precipitous drop due to covid) was 3337.75, from 1119.58, it's a growth of 198%. If there was no covid, that number might have dropped a little bit as the Fed was gradually tightening the economy by raising the interest rate. But the problem is, everything else has gone up especially after covid due to a drop in productivity in the form of overt price increases and shrinkflation over the years. But this should be temporary, once the productivity is increased by everybody working or developing robotics, the price should come back down.
Funny how he doesn't mention brexit, he must be a brexiteer! People who supported and still support Brexit, are in denial.
And quite honestly, we are not poorer. It's just that other countries have become richer due to higher productivity and a bit manipulation. They are exporting to us more than what they are importing from us. Numbers do not lie. They accuse us of begging thy neighbours when Trump wanted to balance the trade more but they have been begging their neighbours for the last 20+ years. LOL Now that we are importing less, they will be feeling the pinch as well. We, on earth as a whole, are living in a closed economy. Until one day we trade with aliens from other planets, we are only passing back and forth from one country to another playing almost a zero-sum game.
Well this thread is about Britain not North America. House prices here in the UK went up 6x since 1997. And Gold went up 6x. And stocks went up 4x (was 5x at the high but have pulled back recently). UK CPI has been just 85% since 1997, even when including the high inflation of the last 18 months. It is a psychological thing, you pay your bills every month and notice the increase. But with stocks instead of 1000 share you can only buy 200 and you don't notice that your money has devalued because stock splits trick you and hide the inflation as well.
I never understood Brexit, neither saw the benefits of it. Who in their right mind could think that closing borders and imposing new regulations to businesses would be beneficial to a country? I am not British, so I always saw the process with an open mouth. The UK will rejoin Europe, slowly slowly, not officially but will try to get to where it was the Brexit mess. As an example: https://www.independent.co.uk/travel/sunak-brexit-deal-travel-chaos-b2326311.html https://www.bbc.com/news/explainers-53724381 They are calling it "New Brexit Deal" But I would say that the UK has way more important issues to deal with: Being poorer is the least of their problems now.