Deflation Tomorrow - Poll

Generali

UK RPI figures are out tomorrow and it seems certain that the UK will be experiencing deflation for the first time since the inter-war period.

Is this a bad thing and if so, who is to blame?

Heyman_2

Well I think it's too late to be playing the blame game now - we're in the sh*t for a variety of reasons so I think it's more a case of a) trying to deal with it and b) trying to make sure it never happens again.

I think the BofE were right to gradually drop interest rates down over 6 months, to give everyone a good chance to see the writing on the wall.

I think the question is more, how protracted will this deflation be?

Edit: I've voted for the global financial crisis as I reckon that's about the best representation out of the options you've given.

southernscouser

I voted for the French.

Generali

southernscouser wrote: »

I voted for the French.

To blame for so many things - Serge Gainsbourg and over-rated wines to name but 2.

Wookster

So far the only 'deflation' I see is correction over way over egged asset prices. I don't think this is a bad thing, in fact it is long overdue, and neither do I think it is deflation proper. Other decreases (such as energy) are not persistent and so do not qualify as deflationary.

Other things such as food and imported goods continue to rise in price at quite alarming levels (food being at 10%!).

Overall this points to a more self sufficient UK which if realised would be a good thing.

tradetime

Definitely that Generali character, he caused the whole thing in his tool shed and it just spiraled from there!

But on a more serious note, I'd say it was a team effort. People like Greenspan interfered in the market creating an era of cheap money and managed to create bubbles everywhere, the fanancil community lobbied for de-regulation and the politicians went along with it, they went along with it because the people were happy because they could borrow whatever they wanted, with very little security, so they could buy whatever they wanted without having to work for it, and so they went on a credit binge for 20 odd years, I don't consider deflation to be the major risk here, any flirtation with it will be brief, never underestimate the power of printing money

Generali

tradetime wrote: »

Definitely that Generali character, he caused the whole thing in his tool shed and it just spiraled from there!

But on a more serious note, I'd say it was a team effort. People like Greenspan interfered in the market creating an era of cheap money and managed to create bubbles everywhere, the fanancil community lobbied for de-regulation and the politicians went along with it, they went along with it because the people were happy because they could borrow whatever they wanted, with very little security, so they could buy whatever they wanted without having to work for it, and so they went on a credit binge for 20 odd years, I don't consider deflation to be the major risk here, any flirtation with it will be brief, never underestimate the power of printing money

Interesting that Blair's got off scott free so far.

minimoocow

I don't know who caused it but if it is deflation tomorrow will the student loans company stick to their word and start paying me back?!:rotfl:

StevieJ

Yanks for me :eek:

Generali

StevieJ wrote: »

Yanks for me :eek:

Blooming US-ians. When they're not starting wars they're arriving late.

Then they go and ruin a perfectly good, no Tory-boom-'n'-bust economy like the UK's.

Gah!

lostinrates

Generali wrote: »

UK RPI figures are out tomorrow and it seems certain that the UK will be experiencing deflation for the first time since the inter-war period.

Is this a bad thing and if so, who is to blame?

Is it a bad thing? I dunno.
Is it happening....well, our personally, our costs are up, but sure, I guess it is over the large scale.
Who do I blame? Everyone.