Daily Mail, your media etc

[BrianW]

A quick guide to inflation:

Your goods cost £100. Ten per cent inflation means they cost £110.
Next year, inflation drops to 7%. They now cost £117.70.
Next year, inflation drops to a mere 5%. They now cost £123.59.

Falling inflation does not mean lower prices. This should be obvious but I am explaining it as some people seem to be confused.

You only get falling prices if there is *deflation*. Deflation is when the inflation index is a minus figure, not a smaller positive one.

I have nonetheless seen people - apparently sane people - arguing that people lucky enough to receive a 'good' pay rise should give it back 'when inflation falls.'

This demonstrates that the education system is not up to it, has not been in my lifetime, and needs to start teaching critical thinking. To say nothing of macroeconomics.

 

[west didsblue]

A quick guide to inflation:

Your goods cost £100. Ten per cent inflation means they cost £110.
Next year, inflation drops to 7%. They now cost £117.70.
Next year, inflation drops to a mere 5%. They now cost £123.59.

Falling inflation does not mean lower prices. This should be obvious but I am explaining it as some people seem to be confused.

You only get falling prices if there is *deflation*. Deflation is when the inflation index is a minus figure, not a smaller positive one.

I have nonetheless seen people - apparently sane people - arguing that people lucky enough to receive a 'good' pay rise should give it back 'when inflation falls.'

This demonstrates that the education system is not up to it, has not been in my lifetime, and needs to start teaching critical thinking. To say nothing of macroeconomics.

The inflation rate is a comparison with the same month one year earlier. There can be peaks and troughs in prices during that year that can result in short term price drops whilst the inflation rate is still well above zero.

 

[BrianW]

You could, conceivably, have the price of eggs, or bread, drop by 50%. However, it's the overall inflation rate that matters, and people on a given income, whose income does not at least increase by that amount, suffer a pay cut in real terms. No amount of fudging of figures can change that.

Now, of course, one is free to argue that the nominal rate of inflation does not reflect the real world. For example, food prices have gone up way more than the official CPI figure, and if you are poor and spend a high proportion of your income on food, this hits you disproportionately hard. The bottom line is that - however you measure it - high inflation is bad for everyone and particularly hard on low earners with little power to increase their income.

But the idea that people should 'give back' hard-won pay increases when the rate of increase in prices declines remains laughable.

 

[bluethrunthru]

This film has yet to be made never mind released - the Mail truly is the drunk at the bus stop shouting at anyone or anything passing by

Mail on Sunday Front Page 23rd of July 2023 - Tomorrow's Papers Today!

The Mail on Sunday highlights an unreleased film that accuses Boris Johnson of lying about his COVID near-death experience.

www.tomorrowspapers.co.uk

 

[Ifwecouldjust.......]

 

[bluethrunthru]

"They all look the same " to the Daily Racist

 

[The Future’s Blue!]

"They all look the same " to the Daily Racist

How can that even be real?

 

[Kompany Car]

Now, of course, one is free to argue that the nominal rate of inflation does not reflect the real world. For example, food prices have gone up way more than the official CPI figure, and if you are poor and spend a high proportion of your income on food, this hits you disproportionately hard. The bottom line is that - however you measure it - high inflation is bad for everyone and particularly hard on low earners with little power to increase their income.

Thats not entirely true, its not bad for everyone, there is a group that can benefit. If you have large amounts of debt at a low fixed interest rate, assuming your income broadly keeps track with inflation, that debt loses its value making the debt less in real terms.

However on the whole, for the vast majority, rich or poor, high inflation is a bad thing.

 

[bluethrunthru]

How can that even be real?

The Heil is sacking journalists - as can be seen they are being replaced by people not up to the job - finding someone who cannot do basic research on Wiki is in fact quite and achievement - I guess thats what £7.49ph gets you

 

[halfmist]

A quick guide to inflation:

Your goods cost £100. Ten per cent inflation means they cost £110.
Next year, inflation drops to 7%. They now cost £117.70.
Next year, inflation drops to a mere 5%. They now cost £123.59.

Falling inflation does not mean lower prices. This should be obvious but I am explaining it as some people seem to be confused.

You only get falling prices if there is *deflation*. Deflation is when the inflation index is a minus figure, not a smaller positive one.

I have nonetheless seen people - apparently sane people - arguing that people lucky enough to receive a 'good' pay rise should give it back 'when inflation falls.'

This demonstrates that the education system is not up to it, has not been in my lifetime, and needs to start teaching critical thinking. To say nothing of macroeconomics.

When I studied Economics, at GCSE,A Level and degree level, in simple terms, the National cake remains the same size in times of inflation.
There are only two choices, make the cake bigger, through productivity increases or efficiency savings or, take a bigger slice of the cake for yourself leaving less for others .
So in terms of a “good pay rise”which of the two alternatives are you recommending should be taken