Savers take more than £8bn from accounts

Rochdale_Pioneers

Exactly. If you want to sell product then it needs to be competitively priced. If the few retailers happy to pass on cost prices to retailers fail, it just clears the way for lower cost base retailers buying products cheaper to take their place. There's been massive over-competition in various retail sectors, weeding out the expensive crap won't hurt, even if it is household names like Currys.

A._Badger

"The UK consumer area is a market economy, not a cartel. The deflationary forces are far larger than the inflationary pressure of a lower pound. "

We are faced with increases at importer level, imposed upon them by forces outside their control. There are no exceptions, except where an importer might elect to absorb a few per cent here or there to gain a small advantage. But that will be a relatively small element in a large price rise.

Were there alternative sources of supply, retailers might have been able to use them.In many cases today, there are not. If you want the item in question and there are no alternatives, you pay the higher price or do without.

This is the harsh reality of international markets. If it collides with theory, reality will win, as it always does.

itsnever2lateisit?

Indeed consumer electonics are already going up, while you and I might just carry on with the same PC, businesses are in a different position. If their server dies it HAS to be replaced, cost is a secondary consideration

Sir_Humphrey

itsnever2lateisit? wrote: »

Indeed consumer electonics are already going up, while you and I might just carry on with the same PC, businesses are in a different position. If their server dies it HAS to be replaced, cost is a secondary consideration

I was arguing about non-essential items. I would still like to know where the money will come from.

The even harsher commercial reality is that if customers cannot afford an item, they will not buy it.

leveller2911

Sir_Humphrey wrote: »

It is the real rate of return that counts. YoY RPI is 0.1%, and prices have been falling MoM since the late autumn. With deflation, savers get a return even at 0% interest, and continue to outperform other investments. Don't fall victim to money illusion.

We savers need to stop whinging.

So my neighbour who is 74 and living off the state pension and a small income from her life savings should stop whinging then? She has seen her income from savings drop by 65%.... Don't understand your reasoning there.She rents, worked hard all her life and paid all of her NI stamps and taxes..........I do wonder about the sanity of some people on here as they don't seem to be able to see outside of there lives.

itsnever2lateisit?

Sir_Humphrey wrote: »

I was arguing about non-essential items. I would still like to know where the money will come from.

The even harsher commercial reality is that if customers cannot afford an item, they will not buy it.

I agree, but what is non-essential to you and me, is essential to someone else. There is lots of teeth-knashing over the fall in sales of cars, yet they are still selling, even if it is only 50% of previous years, Ford incresed price by 5%, will be interesting to see if that affects their sales more than others

Sir_Humphrey

leveller2911 wrote: »

So my neighbour who is 74 and living off the state pension and a small income from her life savings should stop whinging then? She has seen her income from savings drop by 65%.... Don't understand your reasoning there.She rents, worked hard all her life and paid all of her NI stamps and taxes..........I do wonder about the sanity of some people on here as they don't seem to be able to see outside of there lives.

Well, howsabout a chap with two children who is made unemployed owing to high IRs? You can't please all the people all of the time.

The NI pays for her state pension (too low I know), any extra is her business.

Sir_Humphrey

itsnever2lateisit? wrote: »

I agree, but what is non-essential to you and me, is essential to someone else. There is lots of teeth-knashing over the fall in sales of cars, yet they are still selling, even if it is only 50% of previous years, Ford incresed price by 5%, will be interesting to see if that affects their sales more than others

Since Ford would be donald-ducked without US govt help, that is not the best example perhaps! Even if prices could be forced through, the money would come from other consumption, causing offsetting deflation in those areas.

leveller2911

Sir_Humphrey wrote: »

Well, howsabout a chap with two children who is made unemployed owing to high IRs? You can't please all the people all of the time.

The NI pays for her state pension (too low I know), any extra is her business.

I would agree that interest rates of 15% do more harm than good, but are you honestly saying she should not complain ?. If we had interest rates of 6% I dont believe any "chap with 2 children" would be made un-employed because of 6% IR.......Maybe she shouldn't have bothered saving at all.................

Old_Slaphead

Sir_Humphrey wrote: »

Well, howsabout a chap with two children who is made unemployed owing to high IRs?

Lower interest rates aren't being passed on in full to companies as banks are increasing their margins significantly on renewal.

The primary reasons companies are suffering and hence being forced to downsize is lack of demand, the almost universal tightening of credit limits issued by insurers and lack of overdraft credit availability from banks.