brad465
Established Member
There seems to be plenty of stories/activity that suggests a rough period of high inflation has arrived and is set to get worse before it gets better. Earlier this week the UK inflation rate jumped from 2% to 3.2%, the highest change since the Bank of England gained independence, with forecasts suggesting it will reach 4% at least before potentially dropping off.
There are global supply chain problems that are helping drive this, while for us specifically Brexit red tape is not helping matters, in particular exacerbating labour shortages in key sectors such as haulage and fruit/crop picking. Today there are reports some small energy firms will go bust soon due to surging gas prices, and related utility bills are and will be going up at rates higher than the official inflation rate (one reason there are people who believe the official rate is rigged downwards).
In terms of trying to control inflation, the Bank of England seem very reluctant to put interest rates up and withdraw QE to try and control inflation, claiming it's all "transitionary", although a more hawkish shift appears to be emerging for small increases to occur next year. I strongly believe their tone here is because the house of cards that's been created since 2008 will crash if interest rates rise, with public debt likely to be unserviceable and lots of defaults on private debt likely, plus housing and stock market crashes.
Here are some recent key reports related to this:
I wasn't around in the 70s and 80s, but given the times we live in I wouldn't be surprised if a "Winter of Discontent 2" is on the way, if inflation and supply shortages continue to get worse this winter, especially where food and energy supplies are affected. We've also got a tax rise to look forward to next spring, which is already controversial, but if living standards have been squeezed further by high inflation outpacing earnings, this rise will go down very badly and may even lead to a repeat of the poll tax fallout if the right conditions exist. The cabinet reshuffle this week has been suggested as a distraction from a multitude of problems, and the fact it happened on the day the latest inflation figures came out suggests the Government know high inflation won't go down well with their popularity.
There are global supply chain problems that are helping drive this, while for us specifically Brexit red tape is not helping matters, in particular exacerbating labour shortages in key sectors such as haulage and fruit/crop picking. Today there are reports some small energy firms will go bust soon due to surging gas prices, and related utility bills are and will be going up at rates higher than the official inflation rate (one reason there are people who believe the official rate is rigged downwards).
In terms of trying to control inflation, the Bank of England seem very reluctant to put interest rates up and withdraw QE to try and control inflation, claiming it's all "transitionary", although a more hawkish shift appears to be emerging for small increases to occur next year. I strongly believe their tone here is because the house of cards that's been created since 2008 will crash if interest rates rise, with public debt likely to be unserviceable and lots of defaults on private debt likely, plus housing and stock market crashes.
Here are some recent key reports related to this:
Inflation: Price rises see record jump as food costs soar in August
The UK inflation rate hit 3.2% in the year to August, according to the latest official figures.
www.bbc.co.uk
Price rises have seen the biggest jump since records began in 1997 as the economy continued to reopen.
Official figures show that the increase in the cost of living, as measured by the Consumer Prices Index, hit 3.2% in the year to August.
Higher prices in restaurants and for recreation and food were behind the spike, up from 2% the previous month.
The cost of living rose less rapidly in July because of lower clothing and footwear prices.
However, the Office for National Statistics (ONS) urged caution in reading too much into August's price increases, which it described as "temporary".
Eating and drinking out cost more last month in comparison with August last year, when the Eat Out to Help Out Scheme was running and diners got a state-backed 50% discount on meals up to £10 each on Mondays, Tuesdays and Wednesdays.
At the same time, business owners in the hospitality and tourism sectors received a VAT discount, designed to help some of the industries worst hit by the pandemic.
Continued
Four more small energy firms could go bust next week
Rising wholesale gas prices means some companies are unable to supply energy customers have paid for.
www.bbc.co.uk
At least four of the smaller UK energy companies are expected to go bust next week amid soaring wholesale gas prices.
Industry sources have told the BBC that four firms have asked larger players to bid to take over the supply to one million customers.
The price rise has left some companies unable to provide their customers with the energy they have paid for.
Industry rules mean supplies will continue for affected customers, and they will not lose money owed to them.
The new company is also responsible for taking on any credit balances the customer may have.
But paying that credit out to customers is a further disincentive for companies to take on new business.
Continued
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UK fruit and vegetable growers are cutting their planting for 2022 after unprecedented labour shortages led to widespread wastage of produce...
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Public concerns about inflation rose sharply in August as satisfaction with the Bank of England’s control of prices sank to its lowest level in a decade.
I wasn't around in the 70s and 80s, but given the times we live in I wouldn't be surprised if a "Winter of Discontent 2" is on the way, if inflation and supply shortages continue to get worse this winter, especially where food and energy supplies are affected. We've also got a tax rise to look forward to next spring, which is already controversial, but if living standards have been squeezed further by high inflation outpacing earnings, this rise will go down very badly and may even lead to a repeat of the poll tax fallout if the right conditions exist. The cabinet reshuffle this week has been suggested as a distraction from a multitude of problems, and the fact it happened on the day the latest inflation figures came out suggests the Government know high inflation won't go down well with their popularity.