Inflation in the real world

smeagold

bendix wrote: »

So enlighten us goldieboy . . what is the real rate of inflation for you?

I reckon my personal cost of living - the things I buy regularly - are cheaper today than they were a year ago.

ok bendyboy

these are commodity rises which have mostly seen increases over the last few months so those price rises will hit the high street in a couple of months, about the same time the vat increase does.

something to look forward too.

if you want to chart the rises in commodities the best place is

finviz.com/futures.ashx

go have a look you will be fairly amazed.

Linton

Kohoutek wrote: »

Using that logic, virtually everyone in Britain has had a huge increase in their purchasing power over the last ten years (wages going up, pensions and benefits uplifted according to RPI or CPI) if you're claiming that the real cost of living has not increased. I think it's pretty obvious that's not the case.

I am saying my real cost of living hasnt increased, and I have detailed evidence to back this up. If other people have solid evidence to the contrary - let them speak now. Those that dont have any evidence are in a rather weak position to argue.

On the question of people having a large increase in purchasing power, I would think that by and large is the case. Perhaps a good explanation of house price inflation (look if you dare on the "debate" forum).

Stompa

Reaper wrote: »

The BBC once provided a personal inflation calculator but they don't seem to have updated it in the last 2 years.

It looks as though the Office for National Statistics one has recently been updated:

http://www.statistics.gov.uk/PIC/

it gives me a personal rate of 4.0%. When I last checked (in March) it was 2.6%.

Linton

Rollinghome wrote: »

Wait till you get your car insurance renewal: http://www.independent.co.uk/news/business/news/car-insurance-premiums-rise-26-per-cent-as-legal-bills-soar-1976358.html

Haven't a clue about prices in general other than that my council tax bill has risen from £1577 in 2001 to £2770 this year.

Oddly enough I renewed my car insurance a couple of weeks ago. It's the second best price in the past 10 years. True - the renewal quote showed a large rise but a move to a different insurer fixed that.

Yes council tax has gone up a lot as has food. On the other hand car and house insurance has gone down (moved to a modern house), as has my car maintenance (replaced the car).

The problem with RPI and CPI as I see it is that people can change their lifestyle to deal with unreasonable price increases. This isnt fully taken into consideration in the statistics.

sabretoothtigger

I'd agree inflation has been low in the last ten years. That doesnt have to continue though

I think things like food have likely stayed level, where price rises do occur theres usually alternatives available so the uk is pretty well off compared to some places
China excess supply and labour has helped keep costs down also, that rate of growth will change. Technology is a great factor for reducing prices and I think that continues but chinas positive influence on keeping prices low will decline most likely and/or be directed to the benefit of other countries besides usa, uk and europe

bendix

smeagold wrote: »

ok bendyboy

these are commodity rises which have mostly seen increases over the last few months so those price rises will hit the high street in a couple of months, about the same time the vat increase does.

something to look forward too.

if you want to chart the rises in commodities the best place is

finviz.com/futures.ashx

go have a look you will be fairly amazed.

I know what the figures are. I can read.

As someone else has pointed out, we all have our our personal inflation rates - mine will be barely touched by any of these commodity price rises and - to the extent that they are - those rises will be more than compensated by the fact that I am heavily invested in some global resources and commodities funds.

smeagold

bendix wrote: »

I know what the figures are. I can read.

As someone else has pointed out, we all have our our personal inflation rates - mine will be barely touched by any of these commodity price rises and - to the extent that they are - those rises will be more than compensated by the fact that I am heavily invested in some global resources and commodities funds.

smart move, ride the wave.

Rob_192

The OP has posted a chart showing commodity increases, but the actual net cost of the raw material contained in say a £1.50 packet of breakfast cerial is only a few pence. The cost one pays in the supermarket is made up of a variety of things (manufacturing, procesing, transport, packaging, marketing, overheads, profit, supermarket's markup, VAT etc etc).

A 50% rise in the cost of the wheat or barley or whatever will only put maybe a penny or two on the actual cost of the packaged product, certainly no more that the current inflation rate.

smeagold

Rob_192 wrote: »

The OP has posted a chart showing commodity increases, but the actual net cost of the raw material contained in say a £1.50 packet of breakfast cerial is only a few pence. The cost one pays in the supermarket is made up of a variety of things (manufacturing, procesing, transport, packaging, marketing, overheads, profit, supermarket's markup, VAT etc etc).

A 50% rise in the cost of the wheat or barley or whatever will only put maybe a penny or two on the actual cost of the packaged product, certainly no more that the current inflation rate.

thats very true yes but pruducers are having their margins squeezed through rising input costs, it was only last week tesco stopped stocking hovis as they wouldn't allow the breadmaker to pass on the rising cost, not sure how that played out but its a sign.

Due to the recession producers have aggresively reduced running/operating costs down to the bone, theres nothing more to cut any further commodity price rises must be passed on.

this from the daily fail: posted in aug before commodity prices really started taking off

The food prices up 58%: With many facing a freeze on wages, the cost of groceries has rocketed since 2007


Shoppers are paying up to 58 per cent more for basic grocery items than they were three years ago, according to figures published today.

The price of tea has shot up by 30 per cent while the cost of staple foods such as bread and eggs have risen by 18 per cent since 2007.

But the biggest increase has been in the price of rice and pulses such as lentils or beans, which have risen by 58 per cent.

Stompa

Rob_192 wrote: »

A 50% rise in the cost of the wheat or barley or whatever will only put maybe a penny or two on the actual cost of the packaged product, certainly no more that the current inflation rate.

Coincidentally, I noticed yesterday that the price of my breakfast cereal had increased by 8%! The price had remained the same since at least Jan 2009, perhaps longer.