Once inflation rises interest rates will rise rapidly as well

chucky

julieq wrote: »

Did Graham ever figure out where the money needed to pay above inflation returns for risk free easy access savings products comes from? I did ask him a few times, but I never saw an answer.

A savings product, Graham, is like shrink wrapped meat at a supermarket. It's attractively packaged, nicely sanitised, and avoids you having to think too much about where it actually comes from. And it's bad for you.

please don't be beastly to Graham Julie.

he got a bit upset yesterday so everyone is being nice to him

Really2

Graham_Devon wrote: »

Don't think anyone is. Does believeing it might hapen make you so desperate for it? Does discussing such a scenario mean you want it?

Does only refuting it could happen mean you haven't got an alterior motive?

No, but you believe if it does happen wage inflation wont happen, so what you want is wishfull and not sustainable.

The guy is talking about an inflationary boom, wage-price spiral the works.

But all everyone thinks is 8% and static wages. You cant have sustained high inflation without the money supply also inflating.

I have no problem with the prediction if it happens, a boom would be more than welcome.

JonnyBravo

Graham_Devon wrote: »

We do have high inflation, looking over a period of years. But the problem is we don't have the wage inflation to go with it, neither do we any products providing savers with a means of keeping pace with inflation.

Im not sure why wages should always be increasing above inflation. If houses arent capable of increasing in price indefinitely above general inflation why should wages?

Let's face it we've had houses and wages increasing above general inflation for a good while.
Seems like they are both having a correction.

Alternatively I havent got a clue about what drives inflation and someone will now give me a good reason why this can happen?

Exocet

Really2 wrote: »

But all everyone thinks is 8% and static wages. You cant have sustained high inflation without the money supply also inflating.

Does QE inflate the money supply?

Graham_Devon

Really2 wrote: »

No, but you believe it it does happen wage inflation wont happen, so what you want is wishfull and not sustainable.

The guy is talking about an inflationary boom, wage-price spiral the works.

But all everyone thinks is 8% and static wages. You cant have sustained high inflation without the money supply also inflating.

I have no problem with the prediction if it happens, a boom would be more than welcome.

I aint having that argument again!

I stated wage inflation wouldn't keep up with inflation. Not that wage inflation wouldn't happen at all, for the 56th time

Malcolm.

julieq wrote: »

Did Graham ever figure out where the money needed to pay above inflation returns for risk free easy access savings products comes from? I did ask him a few times, but I never saw an answer.

A savings product, Graham, is like shrink wrapped meat at a supermarket. It's attractively packaged, nicely sanitised, and avoids you having to think too much about where it actually comes from. And it's bad for you.

Graham(?), figure something out!?!!!? :rotfl::T

chucky

JonnyBravo wrote: »

Im not sure why wages should always be increasing above inflation. If houses arent capable of increasing in price indefinitely above general inflation why should wages?

Let's face it we've had houses and wages increasing above general inflation for a good while.
Seems like they are both having a correction.

probably related to not needing 100% of the population or even home owners getting wage inflation IMO.

all things being equal i reckon you could have only 30% of people getting decent wage rises and still get HPI.

Really2

Exocet wrote: »

Does QE inflate the money supply?

Yes, that is what the guy is on about, that then filter through to wages.

Just like the 70's wage-price spiral, something sparks it and wages chase prices, prices chase wages and so on and so on.

I can't see why some have not grasped what the guy is on about (not saying you don't but it seems some can't comprehend it)

Graham_Devon

Malcolm. wrote: »

Graham(?), figure something out!?!!!? :rotfl::T

Whats up malcolm dear boy? Actually discussing something too much for you? Feel better with flippant lines and clappy hands?

If your happy with that level, you just carry on lad

julieq

Graham_Devon wrote: »

Jesus, where you come from.

It's like a bull tea party. Hi Julie.

Savings is shrink wrapped meat now? Any advances?

Sorry Graham, I didn't realise we were on quotas. Last time I looked this was an open forum. But I'll check the schedule and if I'm not down to post at this time I'll stop. It's a bit rich though that the bears are now deciding who can post and who can't. Control freaks or what?

Anyway, you still haven't answered the question about where the money needed to pay above interest returns comes from. And it is CRITICALLY important.

Imagine if everyone in the country put their cash into a savings account and left it there. What do you think would happen?

How can you suggest that you can compound savings at 2% over inflation, when also claiming that compounding house prices at 2% over inflation is unsustainable? I'm looking forward to the explanation, but I'm guessing what we'll get is deflection and an masterful application of the Chewbacca defence.

I repeat: savings products are sanitised versions of investment for timid parasites. You can take a return without understanding that to get that return the money is being lent to someone else who is taking a risk at some level or other. The dirty work is hidden from you.

Just like shrink wrapped meat.