Explain inflation to me

[Stubby]

1 hour ago, eggsarascal said:

It's a good job Corbyn didn't get in, he'd have dragged us back to the seventies with spiralling inflation energy costs going through the roof and strikes here there and everywhere. Oh hang on.

Would we all be wearing flares Egger ?

[eggsarascal]

8 minutes ago, Stubby said:

Would we all be wearing flares Egger ?

The Daily Mail would have you believe so.

[Sviatoslav Tulin]

I am from East Europe, and seen 3 x hiper inflation spikes in my time, I can say that inflation is not that bad if its not going out of control, better than stagnation we had in 2008,9,10, cause economic activity still going on, just quality of live is lower, you can't afford some thing, but you will survive for certain, that my experience. 

[Steve Bullman]

isn't hyper inflation the very definition of inflation going out of control? If not, at what rate of inflation is it considered hyper inflation?

[Retired Climber]

We are nowhere near hyper inflation. I think it has to be 50 % per month or 1000% per year. Figures may not be accurate, but you get the idea. 

[Mesterh]

20 hours ago, AHPP said:

It's the increase in the money supply. Say there's £100 in the country. You have £1. You have 1% of the money and therefore 1% of the spending power. Then the central bank (BoE here) prints another £100. You now have 0.5% of the money and spending power.

 

The confusing bollocks about the price of milk, interest rates etc is put about to keep people talking about them when they should be more aggrieved at central banks making the pound in their pocket worth less.

What does the bank do with the extra £100? Who gets it? Or is that a metaphor?

 

I have no clue as to how any of it works. I just thought the price of stuff goes up because of things like shipping cost increase (which I hear has been ruthless lately) energy costs which effect more or less everything and tax increases. 

 

 

[AHPP]

35 minutes ago, Mesterh said:

What does the bank do with the extra £100? Who gets it? Or is that a metaphor?

 

I have no clue as to how any of it works. I just thought the price of stuff goes up because of things like shipping cost increase (which I hear has been ruthless lately) energy costs which effect more or less everything and tax increases. 

 

 

Mainly gives it to the government to spunk around the economy on wars, the dole etc. It trickles down to where most money ends up, landowners and producers of fags and booze.

The money supply aspect of economics is monetary policy btw. The other side of the coin (pun intended) is fiscal policy, which is tax etc. Spend the evening following links on investopedia and look forward to being better informed and furious by bedtime. 

[Squaredy]

4 hours ago, trigger_andy said:

Wa with you til you mentioned Brexit as a cause for inflation. 🙄

I am actually a Brexiteer, but I do recognise that it has caused some increased costs.  When you move house it costs a lot of money, but we still do move house when our existing house is no longer suitable for our needs...

[Sviatoslav Tulin]

1 hour ago, Steve Bullman said:

isn't hyper inflation the very definition of inflation going out of control? If not, at what rate of inflation is it considered hyper inflation?

Maybe I just didn't explain correctly, I didn't say that hiper inflation is OK, but up to 10% it's bearable, last one I remember it was about that rate and lasted about 2 years, but one morning we wake up and all prices went up like 10x times, most people who didn't have savings in dollars, or German mark, lost everything including my family, we survive tough, it was still possible to get jobs and some sort of income, it wasn't easy. Usually printing Mooney, and giving them for noting during economic difficulties causing inflation, if government fails to control it, its become a hiper spike. 

Edited July 20, 2022 by Sviatoslav Tulin

[Sviatoslav Tulin]

18 minutes ago, Squaredy said:

I am actually a Brexiteer, but I do recognise that it has caused some increased costs.  When you move house it costs a lot of money, but we still do move house when our existing house is no longer suitable for our needs...

I don't think it's A Brexit alone, Covid, and ofc MISTER Putin, isn't.